Summary of Arqit Quantum (ARQQ) Conference Call - June 11, 2025 Company Overview - **Company**: Arqit Quantum (ARQQ) - **Industry**: Quantum Encryption Technology Core Points and Arguments 1. **Mission and Technology**: Arqit aims to secure data and communication for governments, enterprises, and individuals using patented encryption software that is resistant to quantum computing threats [3][4][8] 2. **Quantum Computing Threat**: Quantum computers pose a risk to current encryption methods, such as RSA, due to their ability to process information exponentially faster than classical computers [4][11] 3. **Government Recognition**: The U.S. government acknowledges the need for quantum-resistant encryption, as highlighted by National Security Memorandum 10 and recent executive orders from both the Biden and Trump administrations [8][9] 4. **Encryption Methodology**: Arqit utilizes symmetric key agreement cryptography, which does not rely on mathematics and is therefore not vulnerable to quantum decryption [13][19] 5. **Market Focus**: The company targets defense, government, telecom network operators, critical infrastructure, and financial institutions for its quantum-safe encryption solutions [20][21] 6. **Business Model**: Arqit operates on a B2B2B model, where vendors purchase licenses for their software to provide quantum-safe solutions to end customers [24] 7. **Partnerships**: Collaborations with major telecom operators and IT companies, such as Intel, to integrate quantum-safe elements into existing networks [22][23] 8. **Revenue Generation**: Initial revenue is expected from contracts with a global tier one operator and a multiyear contract in EMEA, with a steady build anticipated as new contracts are secured [37][38] 9. **Geographic Expansion**: Contracts are operational in the U.S., Canada, the Middle East, and the UK, with ongoing success in telecom networks and defense sectors [26][27] 10. **Future Outlook**: The company is focused on maximizing existing contracts, engaging with over 10 major telecom operators, and converting opportunities in the financial sector [29][33] Additional Important Content 1. **Market Dynamics**: The urgency for quantum-safe solutions is increasing among target markets, driven by awareness of potential risks associated with quantum computing [42] 2. **Cash Position**: As of the end of the first half, Arqit reported approximately $24 million in cash, with a monthly burn rate of $2.4 to $2.5 million, indicating a comfortable cash position [39] 3. **Challenges in Adoption**: The decision-making process for adopting new technology is lengthy, which may slow down the uptake of Arqit's solutions [42] 4. **Confidential Computing**: Arqit is working on a confidential computing solution in collaboration with Intel to secure data flows within and between cloud environments [25][26] This summary encapsulates the key points discussed during the Arqit Quantum conference call, highlighting the company's strategic focus, technological advantages, and market opportunities.

Financial Data and Key Metrics Changes - For the first half of fiscal year 2025, the company generated $67,000 in revenue, down from $119,000 in the same period of 2024, primarily due to customer delays in contract activities [29][22] - The operating loss for the period was $17,800,000 compared to a loss of $16,600,000 in the first half of fiscal year 2024, reflecting lower revenue and increased administrative expenses [32][34] - As of March 31, 2025, the company had cash and cash equivalents of $24,800,000 [34] Business Line Data and Key Metrics Changes - Revenue from the ARKit SKA platform as a service and ARKit Network Secure products totaled $52,400, with professional services and maintenance revenue at $14,500 for the period [30] - The company is transitioning from primarily enterprise sales to sales through channel partners, which affects revenue recognition timing [29] Market Data and Key Metrics Changes - The market for quantum-safe encryption is growing, with increasing awareness of the need for upgraded cryptography solutions due to the threat posed by quantum computing [5][7] - Significant contracts have been signed in the telecom and defense sectors, indicating a positive trend in market engagement [14][23] Company Strategy and Development Direction - The company is focused on delivering its technology to large enterprises and government customers, with a shift towards a subscription licensing model to align interests with customers [10][11] - Collaborations with major technology partners, such as Intel, are aimed at developing applications for confidential computing and enhancing product offerings [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growing market awareness of quantum-safe encryption and the company's positioning to meet this demand [35][36] - The company anticipates that sales cycles will compress as it builds on existing customer relationships and leverages its technology in complex environments [48] Other Important Information - The company has made significant progress in product development and market penetration, with a disciplined approach to cost control [4][21] - The company is actively recruiting sales personnel with expertise in targeted verticals to capitalize on market opportunities [45] Q&A Session Summary Question: Are the deals that closed at or near the end of the fiscal period currently generating revenue? - The contract with the tier one network operator is a three-year contract, and revenue is expected to grow as end users are signed up [39] Question: What types of people is the company hiring for the sales team? - The company is hiring individuals with deep industry knowledge in telecom and defense sectors to enhance sales efforts [45] Question: Do you expect any increase in operating expenses to support new contracts? - The company does not foresee significant growth in operating costs in the near term, maintaining a focus on customer fulfillment with current staffing levels [54]

Core Viewpoint - Arqit Quantum Inc. is set to report its financial results for the six months ending March 31, 2025, on May 22, 2025, and will host a conference call with key executives to discuss these results [1][2]. Company Overview - Arqit Quantum Inc. specializes in quantum safe encryption, providing a unique encryption software service that secures communications links for networked devices, cloud machines, and data at rest against current and future encryption attacks, including those from quantum computers [3]. - The company's Symmetric Key Agreement Platform allows endpoint devices to create encryption keys locally, ensuring computational security and facilitating Zero Trust Network Access. It can generate limitless volumes of keys and regulate secure device access within groups [3]. - Arqit has received multiple accolades, including being named an IDC Innovator for Post-Quantum Cryptography in 2024 and winning several awards at Mobile World Congress 2024 for its mobile security solutions [3].