Financial Data and Key Metrics Changes - Revenue for Q2 2025 totaled approximately $0.061 million, a decrease from $0.183 million in the same quarter of the previous year [15] - Gross margin increased to 43% from 32% year-over-year, although it remains variable at current revenue levels [15] - Net loss attributable to common stockholders was $36 million for Q2 2025, compared to a net loss of $5 million in Q2 2024 [17] - Total assets increased to $426 million as of June 30, 2025, up from $154 million at the end of 2024 [18] - Cash and equivalents rose by $270 million in the first half of 2025 to $349 million, bolstered by net proceeds of $188 million raised in Q2 [18] - Total liabilities decreased to $30 million, down approximately $16 million compared to year-end 2024 [19] - Stockholders' equity rose to $396 million as of June 30, 2025, reflecting a strengthened capital position [19] Business Line Data and Key Metrics Changes - The company is focused on two revenue streams: quantum machines for complex optimization and a photonic chip foundry for next-generation communication [5] - Significant orders were secured for quantum photonic systems and entangled photon sources, indicating growing commercial adoption [8][9] - A major automotive manufacturer purchased an EMUCORE reservoir computing system, showcasing real-world applications of the technology [10] Market Data and Key Metrics Changes - The company is positioned in a rapidly accelerating market for quantum technologies, with increasing awareness of their role in various sectors [6] - The domestic semiconductor and photonic manufacturing momentum is creating new commercial opportunities for the foundry [6] Company Strategy and Development Direction - The growth strategy is centered on delivering practical, high-performance quantum and photonic technologies rather than theoretical performance [5] - The company aims to integrate quantum machines with nanophotonic chips to enhance performance and reduce costs [23] - The foundry is expected to support both the development of quantum machines and offer services to other companies [24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's progress and the potential of its technologies to deliver real-world solutions [20] - The focus for the next two to three years will be on integrating quantum machines with nanophotonic chips to enhance performance [23] Other Important Information - The company completed a $200 million financing round, strengthening its capital position [16] - Key leadership appointments were made to support the next phase of execution, including a new CFO and COO [13] - The company was added to the Russell 3000 and Russell 2000 indices, increasing visibility among institutional investors [14] Q&A Session Summary Question: What are the most important milestones for the next one to three years? - Management highlighted the integration of quantum machines with nanophotonic chips as a key focus, aiming to enhance performance and reduce costs [23] Question: Will there be an acceleration in spending or M&A activities? - The CFO indicated that while they are hiring additional staff to accelerate technology development, there are no current plans for acquisitions, although strategic opportunities are being explored [27][28]

Financial Data and Key Metrics Changes - Revenue for Q2 2025 was $32,500,000, reflecting a 2% sequential increase and a 29% year-over-year growth, driven by strong new customer growth and expanding deployments [13][30] - Annual recurring revenue (ARR) as of June 30, 2025, was $110,500,000, representing a 27% year-over-year increase [13][32] - Adjusted EBITDA was positive at $2,000,000, compared to a loss of $8,000,000 in the same quarter last year, resulting in an adjusted EBITDA margin of 6% [34] - Total cash, cash equivalents, and marketable securities increased by $2,000,000 sequentially to $37,000,000, marking the first quarter of sequential cash increase [14][35] Business Line Data and Key Metrics Changes - The company welcomed over 60 new customers in Q2 2025, bringing the total to over 1,000 customers globally [14][92] - The company surpassed 7,000 active subscriptions, on track to meet the goal of at least 8,000 by year-end [15] - Approximately 54% of booked units and 56% of booked ARR in Q2 came from existing customers, indicating strong customer trust and value [16] Market Data and Key Metrics Changes - In the education market, the company expanded its presence by approximately 20 new school districts across the U.S., including a significant $15,000,000 contract with Gwinnett County Public Schools [19][20] - In healthcare, the company secured contracts with major institutions like Ohio State University Wexner Medical Center and Broward Health, reflecting growing demand for security solutions [21][22] - The sports and entertainment sector saw new wins with teams like Inner Miami CF and FC Cincinnati, along with significant upgrades from existing customers [24][25] Company Strategy and Development Direction - The company is shifting its go-to-market model to focus more on direct purchase subscriptions, which are expected to yield higher revenue and ARR compared to distribution fulfillment [26][27] - The company aims to build a durable, high-growth business with predictable results, focusing on operational efficiency and customer satisfaction [10][93] - The company is raising its revenue growth outlook for 2025 to 27-30%, up from the previous guidance of 20-25% [28][38] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver on 2025 goals, citing strong visibility into key business drivers and a growing backlog [28][38] - The company is focused on disciplined execution and improving operational efficiency, with a commitment to generating positive cash flow in Q4 2025 [29][40] - Management noted that the DOJ investigation is no longer a concern, allowing the company to focus on growth [9][93] Other Important Information - The company has secured a new $75,000,000 nondilutive credit facility to support its subscription-based sales model [36] - A settlement in principle was reached regarding a securities class action lawsuit, with expected direct financial exposure of no more than $1,000,000 [9][37] Q&A Session Summary Question: What is the expected mix of subscription deals versus purchase subscription deals going forward? - Management indicated a shift towards more subscription deals over time, with a balanced mix expected by 2026 [43][44] Question: What is the cost to refurbish Gen one Express machines for the new certified pre-owned program? - The program, named Evolve Flex, is new, and while refurbishment costs are being kept reasonable, traction is still early [45][46] Question: What is the hiring strategy for the remainder of the year? - Targeted hiring in R&D and services teams is expected, with a slight uptick in operational expenses [51][52] Question: What are the early signs regarding renewals and net revenue retention? - The company reported a net unit retention of over 100% for early renewals, with a focus on derisking renewals [62][63] Question: Where are the biggest opportunities in end markets? - Management highlighted the diversity across verticals, with strong opportunities in education, healthcare, and industrial workplaces [66][67] Question: Will the new credit line be drawn down sooner if business momentum continues? - The first $30,000,000 should suffice for a while, but the credit facility provides flexibility if needed [68][69]

Financial Data and Key Metrics Changes - Total revenue for Q2 2025 was $3.3 million, a significant increase from $1.1 million in Q2 2024, representing a 200% year-over-year growth [17] - Gross profit for Q2 2025 was $2.7 million, up from $0.7 million in Q2 2024, marking a 267% increase [7][17] - Gross margin improved to 83% in Q2 2025, an increase of 1,390 basis points compared to 69.1% in Q2 2024 [18] - Annual recurring revenue (ARR) reached $12.6 million in Q2 2025, a 182% increase from $4.5 million in Q2 2024 [7][17] - Net loss for Q2 2025 was $7.8 million, compared to a net loss of $4 million in Q2 2024 [18] Business Line Data and Key Metrics Changes - The company reported substantial growth driven by its subsidiaries, Vidello and OpenReal, contributing to the overall revenue increase [6] - The operational momentum was highlighted by the strong performance of the product suite, particularly in the AI-powered marketing solutions [6] Market Data and Key Metrics Changes - The global Martech market is expanding rapidly due to digital transformation and demand for personalized experiences, which the company aims to capitalize on [5] - The customer base expanded to over 140,000, including major clients like RBC Capital Markets, Cisco, and Adobe, indicating strong market penetration [12] Company Strategy and Development Direction - The company is focused on a dual strategy of organic growth and acquisitions, targeting key areas such as lead attraction, engagement, tracking, and intelligence [6][9] - The leadership team has been strengthened with the appointment of experienced executives to drive growth and operational efficiency [8][11] - The company aims to increase product capabilities through strategic acquisitions while also focusing on organic growth to reach $50 million in ARR within three years [32][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the operational position and cash flow improvements, emphasizing the importance of reducing capital costs over merely cutting operating expenses [22][29] - The leadership is optimistic about the potential for sequential revenue growth driven by the new team and improved sales processes [26][27] Other Important Information - The company secured an $11 million debt facility to support acquisitions and ongoing operations, enhancing its financial flexibility [7] - The focus remains on targeting mid-market and enterprise segments while also supporting small business customers [12] Q&A Session Summary Question: What is your sales cycle for mid-market and enterprise customers? - The sales cycle varies, with mid-market sales typically between 30 to 60 days, while larger deals may take over a year to close [24][25] Question: Will you be able to continue reducing operating expenses sequentially over the next few quarters? - Management indicated a focus on reducing capital costs rather than operating expenses, with opportunities for efficiency improvements identified [28][30] Question: What is ARR growth normalized for each acquisition? - The target for ARR growth is in the 20% to 30% range over the next year, with potential for outperformance depending on acquisitions [31] Question: Can there be development and profitability with the urgent time? - Management believes slight improvements in adjusted EBITDA could lead to positive cash flow, with ongoing efforts to explore options for profitability [34] Question: How do you drive revenue up significantly? - The company is focused on customer expansion through cross-sales and upgrades, with a strategy to increase revenue from existing customers over time [41][48]

Financial Data and Key Metrics Changes - The company ended the quarter with approximately $5 million in cash and cash equivalents and a working capital deficit of approximately $12.6 million [17] - General and administrative expenses were $2.4 million compared to $2.5 million in 2024, primarily due to decreases in personnel costs and stock-based compensation [18] - Research and development expenses were $1.4 million, a 71% decrease versus Q2 2024, mainly due to reductions in R&D expenses recognized from non-dilutive funding awards [18] Business Line Data and Key Metrics Changes - The company is on track to support the commercial availability of DARE2PLAY Sildenafil Cream through a 503B outsourcing facility in Q4 2025, representing a significant milestone in women's sexual health [5][6] - Ovaprene, a hormone-free contraceptive candidate, continues to progress with the Phase three trial, receiving a recommendation to continue from the Independent Data and Safety Monitoring Board [10] - DARE HRT1, an intravaginal ring for hormone therapy, is pursuing both FDA approval and a 503B compounding opportunity, targeting availability in late 2026 [12][13] Market Data and Key Metrics Changes - The company is addressing a significant unmet need in the contraceptive landscape with Ovaprene, which could transform the market for hormone-free birth control [11] - The compounded hormone therapy market is estimated at $4.5 billion, where DARE HRT1 is expected to generate meaningful revenue [12] Company Strategy and Development Direction - The company is executing a dual path strategy, focusing on commercializing proprietary formulations while pursuing FDA approval for innovative women's health solutions [2][5] - The strategy includes leveraging non-dilutive capital and a disciplined investment approach to unlock value efficiently [6] Management's Comments on Operating Environment and Future Outlook - Management highlighted the significant interest and unmet need in supporting women with arousal concerns, as evidenced by the feedback from the direct-to-patient awareness campaign [7] - The company remains optimistic about the potential of DARE2PLAY Sildenafil Cream as a near-term revenue driver and is excited about the ongoing clinical programs addressing women's health needs [9][15] Other Important Information - The company received approximately $17.6 million in net proceeds from sales of common stock and a $6 million grant payment after the quarter end, strengthening its balance sheet [17] - The company is preparing to launch two non-prescription vaginal probiotics designed to support vaginal microbiome health, complementing its prescription offerings [13] Summary of Q&A Session - Due to technical difficulties, there was no Q&A session held during the call [18]

Financial Data and Key Metrics Changes - For Q1 fiscal 2026, revenue increased by 21% to $3.9 million compared to $3.2 million in the prior year quarter [10] - Gross profit totaled $3.1 million, up 31.9% from $2.4 million in the prior year, with a gross profit margin improvement to 80.5% from 73.8% [11] - The company achieved positive EBITDA of $333,000, marking the first quarter in its history to reach this milestone [14] Business Line Data and Key Metrics Changes - Recurring revenue from technology as a service and usage-based subscriptions remained robust, driven by the popularity of the FDA cleared cardiac monitoring technology [10] - Technology fees accounted for 87% of total revenue, indicating strong customer retention and quality of support services [10] - Operating expenses decreased by 18.5% to $2.8 million from $3.5 million in the same period last year, with SG&A expenses down by 27.9% [12] Market Data and Key Metrics Changes - The company has expanded its market access through strategic partnerships with three major group purchasing organizations, providing access to approximately 90% of hospitals in the U.S. [5][13] - Regulatory approvals have been obtained in Canada, Saudi Arabia, Argentina, and other smaller markets, aligning with the strategy to promote accessible, high-quality care [6] Company Strategy and Development Direction - The company is focused on advancing its Cardiac AI cloud platform and pursuing FDA clearance for its AI clinical model, aiming to set new standards in cardiac care [4][5] - Strategic partnerships are being sought to further expand U.S. market access and capitalize on advantageous terms for solutions [6] - The company is diversifying into pulmonary neurology fields through partnerships with leading home-based diagnostic solutions [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's market position and the growing demand for its products dedicated to chronic cardiac disease prevention and management [16] - The focus on innovation and development continues to yield advancements in remote monitoring solutions, bringing the company closer to profitability [16] - The company is optimistic about maintaining margins, increasing growth, and achieving sustained profitability [19] Other Important Information - The net loss attributable to common stockholders for Q1 was $754,000, a significant improvement from a net loss of $6.9 million in the prior year [14][15] - The company has achieved positive free cash flows for the last four consecutive quarters, indicating a path towards profitability [13] Q&A Session Summary - No questions were raised during the Q&A session, and the call concluded with management expressing excitement about the next fiscal year and the milestone of moving to positive EBITDA [18][19]

Financial Data and Key Metrics Changes - Revenue for Q2 2025 was €614.2 million, representing a 4.5% year-over-year growth, with a 1% growth in organic constant currency and 0.5% sequential growth [6][30] - Non-IFRS adjusted operating margin was 15% for the quarter, maintaining stability despite foreign exchange headwinds [30] - Non-IFRS adjusted diluted EPS for the quarter was $1.53, an increase from $1.51 in the previous year [30] - Free cash flow for the quarter was negative $2.9 million, an improvement from negative $28 million in the same period last year [31] Business Line Data and Key Metrics Changes - The AI Pods subscription model has gained traction, with 18 clients adopting this new model, contributing significantly to recent pipeline growth [8][41] - The company is focusing on high-value clients in sectors such as healthcare, financial services, consumer packaged goods (CPG), and gaming [6][30] Market Data and Key Metrics Changes - North America accounted for 54.1% of revenue, Latin America 19.7%, and Europe 19.6%, with Europe being the fastest-growing region at 8.1% sequentially [16] - New markets grew 84% year-over-year, currently representing 6.6% of total revenue, with the Middle East leading this surge [17] Company Strategy and Development Direction - The company is implementing a business optimization plan to align workforce skills with strategic priorities, resulting in a reduction of approximately 1,000 employees or 3% of the workforce [33] - The focus is on building a structurally agile organization to compete effectively in an evolving landscape while delivering strong results for shareholders [6][30] - The company aims to enhance its AI capabilities through partnerships with major AI leaders like OpenAI and AWS, integrating advanced models into its offerings [14][28] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding pipeline conversion, noting that while the macro environment remains uncertain, there are positive signs of recovery in North America and Latin America [48][72] - The company expects revenue for the full year 2025 to be at least $2.445 billion, representing a 1.2% year-over-year growth [35] Other Important Information - The company recorded a one-time charge of $47.6 million in Q2 due to the optimization plan, which is expected to generate $80 million in annualized savings [33] - The AI Pods model is designed to provide guaranteed time and cost savings, shifting the value proposition to concrete results [8][30] Q&A Session Summary Question: Can you provide more details on the AI-based delivery model and subscription side? - The company has 18 paying customers under the subscription model, which has been well received, generating code and software needed by clients [41][42] Question: How far along are the initial changes from the optimization plan? - Additional reductions are expected in Q3, with most of the plan already implemented [50][51] Question: How is the creative performance of the GUT relative to other studios? - The creative pillar has been growing nicely, with no significant impact from AI on high-level strategic work [56][59] Question: Is the enterprise AI platform creating enhanced stickiness with customers? - The enterprise AI platform is becoming essential for clients, integrating complex AI ecosystems and enhancing client engagement [64][66] Question: Can you discuss the revised growth outlook and assumptions? - The revised outlook reflects stabilization in Latin America and a positive trend in the pipeline, with expectations for recovery in the US market [78][80]

Financial Data and Key Metrics Changes - The net loss for the second quarter of 2025 was $25.4 million or $0.43 per share, compared to a net loss of $33.5 million or $0.58 per share in the first quarter of the same year [9][24] - As of June 30, 2025, the company had $28.7 million in cash and investments, bolstered by a registered direct offering that raised $20.6 million in net proceeds [9][10] - Total operating expenses from continuing operations for the second quarter were $32.4 million, a decrease of $2.6 million from the first quarter [26] Business Line Data and Key Metrics Changes - Research and development expenses in the second quarter were primarily focused on Zaltanopart and narsoplimab [27] - Interest expense for the second quarter was near zero, primarily due to an $8.5 million non-cash remeasurement adjustment related to the DRI Amidrea royalty obligation [27] Market Data and Key Metrics Changes - The global market for paroxysmal nocturnal hemoglobinuria (PNH) is projected to grow at 11% annually, reaching over $10 billion by February 2032 [20] - The complement inhibitor segment is expected to more than double from $2.2 billion today to $4.7 billion over the next seven years [20] Company Strategy and Development Direction - The company is focused on the anticipated approval and launch of narsoplimab, targeting the initial indication of stem cell transplant-associated thrombotic microangiopathy (TATMA) [11][12] - The company aims to leverage its experienced field marketing team and skilled sales force to drive rapid uptake of narsoplimab upon approval [18] - Discussions regarding potential asset acquisition and licensing agreements involving clinical assets are ongoing, with one transaction expected to be a multibillion-dollar deal [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the approval process for narsoplimab, with the FDA indicating that labeling discussions are planned to begin no later than October 2025 [13] - The company is optimistic about the market opportunity for narsoplimab, especially given the safety and efficacy data compared to existing treatments [14][15] Other Important Information - The company has adequate supply for narsoplimab for the first several years post-launch, ensuring no supply challenges [53] - The company is advancing its oncology platform, including IND enabling studies for its Oncotox biologics program targeting acute myeloid leukemia (AML) [23] Q&A Session Summary Question: Comparison of narsoplimab launch to Omidria - Management noted that the market for narsoplimab is significantly more focused than that for Omidria, with fewer salespeople needed due to the limited number of transplant centers [37][38] Question: Comfort level of clinicians regarding narsoplimab - Physicians are eagerly awaiting the approval of narsoplimab, viewing it as a much-needed solution for patients facing lethal complications post-transplant [44] Question: Anticipated launch timeline post-approval - If approved in December, the launch would occur in the first quarter of the following year, with substantial supply already in place [50][51] Question: FDA's request leading to PDUFA delay - The FDA requested additional analyses, which were extensive, leading to the three-month delay in the PDUFA date [58][60] Question: Potential partnerships - There is substantial interest in partnerships across the company's programs, but specific details are limited due to confidentiality requirements [61]

Financial Data and Key Metrics Changes - The company reported a net loss of $45.3 million or $1.04 per share for Q2 2025, compared to a net loss of $23.7 million or $0.62 per share for Q2 2024, indicating a significant increase in losses [26] - Non-GAAP adjusted net loss was $40.5 million or $0.93 per share for Q2 2025, compared to a non-GAAP adjusted net loss of $22.2 million or $0.58 per share for Q2 2024 [26] - Research and development expenses increased to $40.2 million for Q2 2025 from $22.5 million in Q2 2024, driven by increased employee and consulting expenses and costs related to ongoing clinical trials [26][27] - General and administrative expenses rose to $3.8 million for Q2 2025 from $1.8 million in Q2 2024, primarily due to increased employee and consulting expenses [27] - The company ended the quarter with approximately $168.4 million in cash, cash equivalents, and short-term investments, which is expected to increase to approximately $455 million after accounting for recent financing activities [28] Business Line Data and Key Metrics Changes - The company achieved significant milestones in its clinical trials, including positive top-line data from the VICTORIA-one trial for patients with HR positive HER2 negative advanced breast cancer, demonstrating unprecedented improvements in progression-free survival (PFS) [6][10] - The median PFS for the gadatholitinib triplet was reported at 9.3 months compared to 2 months for fulvestrant, with a hazard ratio of 0.24, indicating a 4.2 times higher likelihood of survival without disease progression [10][11] - The company also dosed the first patient in the VICTORIA-two trial, which evaluates gadatholitinib in combination with a CDK4/6 inhibitor and fulvestrant as first-line treatment [8][18] Market Data and Key Metrics Changes - The addressable market potential for a standard of care second-line therapy for the targeted patient population is estimated at approximately $5 billion [18] - There are approximately 34,000 patients moving to second-line treatment after progressing on a CDK4/6 inhibitor, with around 60% being PIK3CA wild type, indicating a large opportunity for the company's therapies [14] Company Strategy and Development Direction - The company aims to establish gadatholitinib as a new standard of care therapy for patients with HR positive HER2 negative advanced breast cancer, focusing on both PIK3CA wild type and mutated populations [6][10] - The company plans to submit a new drug application to the FDA in 2025 based on data from the PIK3CA wild type cohort [13] - The company is preparing for a potential launch of gadatholitinib, having built a commercial team and infrastructure to support the launch [48][52] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the market landscape for gadatholitinib, highlighting the significant unmet need for more efficacious therapies in the second-line treatment space [14][15] - The company believes that the favorable safety profile and efficacy of gadatholitinib will position it well against currently available therapies [12][15] - Management is confident in the robustness of the data and the preparations for the NDA submission, indicating a strong belief in the potential approval and market entry [70] Other Important Information - The company raised approximately $287 million through public offerings of convertible notes, common stock, and pre-funded warrants, providing necessary funding for its operations and clinical trials [10][24] - A new patent was issued extending the exclusivity of gadatholitinib into 2042, allowing the company to optimize its development strategy [23][24] Q&A Session Summary Question: What to expect from the upcoming full data presentation for the PIK3CA wild type portion of the Phase III study? - The company will focus on primary analyses and endpoints, with additional subgroup analyses expected at subsequent meetings [30][31] Question: What benchmarks for success are considered for the PIK3CA mutant population? - A statistically significant result would be clinically meaningful if it shows an improvement of less than three months compared to historical data [32] Question: Can more safety data be provided ahead of the full presentation? - Detailed safety data will be provided at the upcoming conference, with a general summary available at this stage [37] Question: Will PFS analysis based on investigator assessment be presented later this year? - The selection of BICR for the study was to eliminate investigator bias, and the investigator data will be used for exploratory analysis [40][42] Question: How is the company preparing for launch readiness? - The company has been building its team and infrastructure since last year, focusing on key positions to support the launch [48][52] Question: What are the practical ramifications for physicians with both doublet and triplet options? - Having both regimens allows physicians to optimize treatment based on patient needs, providing flexibility in managing disease progression [55][56] Question: Is there a consideration for a commercial partnering strategy for the launch? - The company plans to launch itself, believing it has the necessary infrastructure and capital to do so effectively [58][59] Question: What are the competitive landscape thoughts regarding the mutant population? - The company believes that positive data will position it well against competitors, particularly in the context of PIK3CA mutations [65][66]

Financial Data and Key Metrics Changes - The company recorded its first revenue of just over $90,000 in Q2 2025, marking a significant milestone in its history [22] - The net loss for the quarter was $4,690,000, compared to $1,460,000 for the same quarter in 2024 and $1,980,000 for Q1 2025 [22][23] - Operating expenses increased to $4,630,000 from $1,480,000 in the same quarter last year, largely due to costs associated with the public listing [22][23] - The cash balance at the end of the quarter was $607,000, an increase of $478,000 from the previous balance [23][24] Business Line Data and Key Metrics Changes - The company is focused on three key areas: commercialization and operational excellence, patents and partnerships, and building recurring value [10][12] - The partnership with Hancock Health is a multi-year project aimed at piloting the ArrivePoints in hospitals for secure robotic delivery [25][29] Market Data and Key Metrics Changes - The company is targeting the $191 billion US package delivery market, with a focus on integrating drones into the national airspace [8] - The pilot programs launched with hospitals, retail partners, and municipalities are validating the capabilities of the platform [6][29] Company Strategy and Development Direction - The company aims to transition from pilot projects to defining and dominating key market verticals, focusing on building a defensible mode of intellectual property and strategic partnerships [6][7] - The five-year plan includes scaling production to 10,000 units annually by year four and 100,000 units by year five, with a goal of a tenfold increase in company value [19][26] - The strategy emphasizes a platform as a service model, where revenue grows with every delivery and new ArrivePoint deployed [12][48] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the current market conditions and the company's positioning within the autonomous delivery landscape [14][40] - The recent regulatory changes regarding drone operations are seen as a watershed moment for innovation in the logistics sector [8][29] Other Important Information - The company has filed two additional patent applications and secured a cornerstone patent for its intelligent chain of custody delivery network [32][35] - The management team is focused on building a scalable and defensible business model, with a disciplined approach to capital use [21][25] Q&A Session Summary Question: How does the company plan to transition from its current pilot-centric pre-revenue model to a scalable profitable business? - The COO outlined a strategic five-year plan focusing on product development and partnerships to achieve scalability [46] Question: How will your platform as a service model work? - The COO explained that the model will include a network as a service fee, a marketplace for demand resolution, and AI platform services [48][49] Question: Do you anticipate the new tariffs will materially affect your supply chain costs? - The Chief Strategy Officer mentioned plans to onshore production to the US to mitigate potential tariff impacts [81] Question: What would help Arrive AI succeed in the short term and long term? - The Chief Strategy Officer highlighted the importance of regulatory changes allowing beyond visual line of sight operations for drones [91] Question: What are the biggest risks you see in the next few quarters? - The CFO noted that success will depend on the number of pilots deployed and the learnings from those deployments [96] Question: How is Arrive AI positioned to weather economic downturns? - The CFO emphasized focusing on internal strategies and deployments rather than external market volatility [101] Question: What are your thoughts on potential partnerships with major delivery companies? - The CEO indicated ongoing conversations with various companies but could not disclose specifics due to NDAs [106]

Financial Data and Key Metrics Changes - Operating expenses were reduced by 26% from Q1 to Q2 2025, declining to $3.3 million from $4.5 million [29] - Year-to-date operating expenses are down 14% compared to the same period last year, from $9.1 million to $7.9 million [29] - Cash flow improvements were noted, with net cash used in operations declining by $2.2 million for the first six months of 2025, down to $5 million compared to $7.2 million in the same period of 2024 [29] - Cash and cash equivalents increased by 16% to $4.2 million as of June 30, 2025, up from $3.6 million at December 31, 2024 [29] - Revenue for Q2 was $1 million, with year-to-date revenue at $1.8 million [30] Business Line Data and Key Metrics Changes - BolaWrap deployments are increasing across diverse law enforcement agencies, with strong usage reported in Colorado, North Carolina, and Canada [10] - Agencies in Florida are evaluating BolaWrap as a strategic replacement for traditional electronic control devices like TASERs [10] - The crisis intervention team in a major Floridian agency reports more frequent BolaWrap use than TASERs, indicating a shift towards safer tools [11] Market Data and Key Metrics Changes - Favorable federal regulatory changes, including the Supreme Court decision in Barnes v. Felix, are driving adoption and sales of BolaWrap [15][16] - Increased inquiries and strategic discussions with customers are being observed due to heightened awareness around safer alternatives to traditional use of force tools [17] Company Strategy and Development Direction - The company has completed its restructuring efforts and is now focused on a renewed go-to-market strategy that emphasizes pre-escalation [5][40] - The introduction of new subscription models, Wrap Ready and Wrap Plus, aims to address customer concerns regarding replacement costs and enhance value propositions [31][32] - The company is expanding into adjacent markets such as healthcare, transportation, and private security, leveraging its existing technology and partnerships [26][64] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the momentum building for Wrap Technologies, citing a sharp increase in purchase orders and positive customer feedback [4][40] - The company believes it is well-positioned to capitalize on the evolving regulatory landscape and increasing demand for safer policing tools [40] - Management highlighted the importance of training and partnerships in driving adoption and success in the market [25][52] Other Important Information - The company has applied for nearly $1 million in DOJ-funded grants to support pre-escalation tools and training [33] - A new counter UAS capability has been developed, targeting a growing market projected to reach $6.8 billion by 2030 [38] - The rebranding of the body-worn camera business line to WrapVision aims to address data sovereignty concerns and enhance product offerings [39] Q&A Session Summary Question: How do you plan to accelerate adoption among law enforcement agencies in the US and internationally? - Management noted that adoption is being driven by regulatory changes and direct engagement with departments, emphasizing the importance of training and connectivity with officers [42][45][50] Question: How do you plan to penetrate non-law enforcement sectors? - The company is already seeing interest from hospitals and correction facilities, with a focus on scaling operations and leveraging data to drive adoption [56][60][64] Question: Are there adjacent product lines or technology upgrades planned in the next eighteen months? - Management confirmed ongoing developments, including counter drone capabilities and enhancements to the body-worn camera line, indicating a strategic focus on expanding product offerings [67][70] Question: What is the status of the company's move to Virginia, and when do you expect production to ramp up? - The company has fully moved to Virginia and is prepared to scale production in response to increasing demand [76][78] Question: How do you see one-time sales versus subscription services as a portion of your revenues? - Management highlighted a strategic shift towards recurring subscription models, which are expected to provide more stable revenue streams compared to one-time sales [80][81]