Aeluma, Inc. Q1 2026 earnings call

Thanks, Gary. Good afternoon and Welcome to Aeluma's First Quarter Fiscal 2026 Earnings Call. I'm here today with founder and CEO Jonathan Klamkin and CFO Christopher Stewart. Today's discussions and responses to questions may include forward-looking statements, which are subject to various risks and uncertainties that could cause our actual results to differ materially from these statements. These risks and uncertainties are detailed in the earnings press release issued today, along with the reports filed with the U.S. Securities and Exchange Commission. These reports, along with today's earnings release, can be found under the investor section of our website. Aeluma assumes no obligation to update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this call. Throughout the discussion, the company will refer to non-GAAP financial measures, including EBITDA and adjusted EBITDA. A reconciliation of our non-GAAP financial measures to the most directly comparable GAAP measures is included in our earnings press release and SEC filings. Now I'll turn the call over to Aeluma's CEO, Jonathan Klamkin.

Thank you, Tony, and thank you all for joining. Let's begin with the growing spotlight on AI adoption. Its rapid acceleration is driving unprecedented demand for optical component technologies for AI infrastructure. In response, Aeluma has fast-tracked the transition to commercial-scale production of our high-performance semiconductors. Aeluma builds critical semiconductor photonics, including high-speed transceiver components and high-power quantum dot lasers for optical interconnects. We've invested in a breakthrough manufacturing platform with the potential to meet the performance, scale, and cost requirements for AI and other large-volume markets. The way cloud computing became the new standard for deploying and managing digital services, we believe Aeluma's approach will become the way of the future for semiconductor manufacturing. That is the definition of a disruptive technology. Think of the impact in the context of what is happening on a global scale. Demand for semiconductors in U.S. Markets is at an all-time high, yet many fabs are overseas and supply chain issues are impeding the usual way of doing things.

Turn to Aeluma. We do not rely on expensive indium phosphide substrates that now have historically long lead times and historically high prices. We currently work with multiple U.S.-based fabs, including one well-known large-volume pure-play foundry. Manufacturing on small substrates made of materials that, in short supply and with low-volume specialty fabrication processes, will not suffice, and Aeluma is here to capitalize on this opportunity. The market for optical component technologies and AI infrastructure alone is projected to be several billion dollars within just a few years. Aeluma's technology also applies to other high-growth market verticals, including defense and aerospace, mobile and consumer electronics, industrial and robotics, to name a few.

As we navigate a period of unprecedented demand, customer opportunities continue to expand, fueling our go-to-market plan. How are we executing? To begin, we completed an oversubscribed capital raise which strengthened our no-debt balance sheet and boosted our cash to $38 million. With this strong financial position, plus the revenue generated from R&D contracts, we continue to execute our strategic priorities and accelerate our transition to commercialization. Our ongoing R&D contracts reflect our dual-use technology approach to address market needs. We selectively bid on programs to advance technologies important to government customers but that also have commercial applications in our target markets. This quarter, we signed a new contract with NASA to leverage our scalable semiconductor platform for quantum. Our approach provides a path to low size weight and power quantum systems, making them viable for space-based platforms.

Programs like this provide non-dilutive funding for development while commercial companies evaluate our technology for potential integration. As a reminder, Aeluma's technology combines best-in-class semiconductor materials with large-volume microelectronics manufacturing. We recently announced that, in collaboration with Thorlabs, we will be delivering a presentation on Aeluma's scalable photonics platform at SPIE Photonics West Conference in January. This is the world's largest annual conference and exhibition for optics and photonics technologies, and we look forward to sharing our breakthrough at this prestigious gathering. We will also host a company booth at the exhibition, which is a terrific venue to meet with existing and potential customers and to showcase our technologies. Key to our go-to-market plan is increasing manufacturing readiness. This means qualifying our processes for production. To do so, we have increased wafer fabrication levels at our foundry partners nearly fivefold and made an investment in wafer-scale test capabilities.

On the latter, we recently inked an amazing deal to acquire significant capital equipment assets from a major components and solutions provider at nearly one cent on the dollar. Also critical to increasing manufacturing readiness is adding key members to our team. We recently filled important roles, including Director of Supply Chain Manufacturing, Director of Technology Enablement, among others, and we continue to recruit in the areas of business development, manufacturing, and operations. I am thrilled at the caliber of applicants we are interviewing. What we are doing at Aeluma is attracting elite candidates, and we look forward to adding more talent to the team as we drive our transformative technology forward. The demand for high-performance semiconductor components continues to rise, especially for photonic technologies supporting the adoption of AI.

It's exciting to see new customer opportunities converging around our vision, growing interest in our technology, and the meaningful impact we're poised to deliver at scale. As we deepen and expand engagements with prospective customers, we're uncovering even greater opportunity aligned with our offerings and product roadmap. This reinforces confidence in our technology, approach, and business model. All pieces are falling in place to create the one plus one equals three value proposition that we believe paints a bright future for Aeluma, its customers, and its shareholders. Now I'll turn the call over to our CFO, Christopher Stewart, to discuss the financials.

Thanks, Jonathan. Now I will share some highlights of our first quarter fiscal 2026 financial results. We are pleased to report another solid quarter of revenue from our government and commercial contracts. For the quarter ended September 30, revenue was $1.4 million, compared to $481,000 a year ago and $1.3 million in the prior quarter. GAAP net loss for the first quarter was $1.5 million, or $0.09 per share, versus a net loss of $730,000, or $0.06 per share in Q1 of last year, and a net loss of $859,000, or $0.05 per share in the June quarter. The increase in net loss from the prior quarter was primarily attributable to higher payroll and stock-based compensation expense.

Non-GAAP net loss for the quarter was $437,000, or $0.03 per share, versus a net loss of $550,000, or $0.04 per share in the first quarter last year, and a non-GAAP net loss of $112,000, or $0.01 per share in the June quarter. Adjusted EBITDA for the quarter was a loss of $450,000, compared to a loss of $457,000 for the comparable period last year, and a loss of $113,000 in the prior quarter. We ended the first fiscal quarter with $38.1 million in cash and cash equivalents, and we currently have no long-term debt. During the quarter, we closed a follow-on public offering for 1.955 million shares, raising net proceeds of $23.4 million. The capital significantly strengthened our balance sheet, more than doubling our cash position. We expect this additional cash will support our plan to transition from exclusively R&D revenue to initial commercial product revenue.

Now turning to our expectations for fiscal 2026, we continue to expect revenue in the range of $4 million, as we stated in our year-end call. For a majority of our contracts, revenue is recognized upon achievement of technical milestones. Once again, in the quarter, we hit all of our planned milestones, adding to our impressive track record of timely delivery. That said, revenue may vary quarter to quarter depending on the timing of achieving and receiving customer sign-off on these milestones. We view this R&D revenue as important, non-dilutive financing that supports our development efforts and progress towards commercial readiness. As previously discussed, we are highly selective in bidding only on projects we believe will have an impact in our commercial target markets, while our strategic priority for fiscal 2026 is positioning Aeluma to begin the transition to commercial product revenue.

Going forward, we expect to prudently increase spending as we invest in growth initiatives, including increased production for technology validation and expanding our business development, manufacturing, and operations teams. With our established capital-efficient market, we are focusing our investments on what is most critical for an effective transition to commercialization. Several of the industries that we are targeting are poised for significant technology-enabled growth, and we plan to be ready for this major inflection point in the semiconductor industry. Now I'll turn the call back to Jonathan for his closing remarks before we open the call to your questions.

Thank you, Chris. The fiscal year is off to a promising start with key objectives already underway. In support of our go-to-market strategy, we've made continued progress to strengthen our financial position, increase our manufacturing readiness, and expand our team. Demand for high-performance semiconductor technology in our key target markets continues to grow, and we believe we will be in a position to deliver at the scale required by our customers. We look forward to sharing more information with you in the near future. I want to thank our incredible team for their commitment and hard work, and a special thank you to all our investors for your support and enthusiasm that drives us every day. Operator, you can now open the call for questions.