Blaize Holdings, Inc.

Good afternoon, everyone, and thank you for joining Blaze's second quarter 2026 conference call. Before management begins the prepared remarks, we would like to remind everyone that earlier today, Blaze Holdings issued a press release announcing its second quarter 2026 results. Earnings materials are available on the investor relations section of the Blaze Holdings website. Today's earnings call and press release reflect management's views as of today only and include statements related to the company's 2026 financial guidance, revenue, gross margin, competitive position, anticipated industry trends, market opportunities, products, and financing opportunities, all of which constitute forelooking statements under the federal securities laws. Actual results may differ materially from those contained or implied by these four lucky statements due to risk and uncertainties associated with Blaze Holdings' business. For a discussion of the material risk and other important factors that could cause the company's actual results, please refer to the company's Form 10-K and Amendment No. 1, Form 10-K, for the year ended December 31, 2025. and our form 10-Q for the period ending June 30, 2026, including the risk factors section therein and today's press release. Any forward-looking statements that management makes on this call are based on assumptions as of today, and other than as may be required by law, we undertake no obligation to update these statements as a result of new information or future events. During this call, management will discuss certain non-GAAP financial measures. These non-GAAP financial measures should be considered as a supplement to and not a substitute for measures prepared in accordance with GAAP. For reconciliation of non-GAAP financial measures discussed during this call to the most directly comparable GAAP measures, please refer to today's press release. Now, I would like to turn the call over to Dinakar Munagala, Chief Executive Officer of Blaze Holdings.

Thank you and good afternoon. With me today are Harminder Sehmi, our Chief Financial Officer, and Stephen Patek, our Chief Revenue Officer. I will start with the outlook and where the business stands. Harminder will take you through the numbers and Stephen will cover our commercial engines. I will then have some closing remarks after the Q&A. As you saw from our earnings release this afternoon, we reduced our revenue outlook for 2026. Our full year revenue is now expected to be between $40 million and $43 million. What that number does not show you is what we have already secured. We hold a signed agreement covering 2000 servers worth approximately $70 million at current memory prices. Part of that converts into revenue this year. The rest is committed business we carry into 2027. Let me tell you what changed and what did not. First, several engagements have not converted into orders, including some where pilots were completed successfully. Second, Other opportunities are still in progress and expected to close later than we forecast. And third, supply chain costs inflation. Memory pricing has risen materially this year and we expect that to persist. Harminder will take you through each of them along with the backlog. We expect to be holding at year-end. And what we have changed in how we build our expectations. Behind that number, the business is broadening. Our largest customer in China continues to generate meaningful business for us. We have opened Europe with the first purchase order for several thousand units. And activity across the Asia-Pacific region has increased. Let me tell you what we are seeing because it explains both the quarter and the book behind it. The market has made up its mind this year. Building frontier AI costs more than it earns, and the gap is widening. At the same time, efficient open models are making AI cheaper to run. Value is moving from who cranes the biggest model to who runs it most efficiently. The economics of inference are now the deciding factor. That is the market our architecture was designed for, and we are making real progress in it. Two market trends are converging and we're winning in both. First is physical AI. Countries and industrial companies are putting AI into the field on vehicles, on ships, on machines, and inside their own borders and their own sites. Partly for security and control of the data, but mostly because the work demands it. Speed of response, scale, Places the cloud cannot reach. Next is a new generation of AI data centers built to run AI, not just to train it. Training does not go away. It changes shape into constant tuning and specialization. These sites run many models on many kinds of chips. And they're built on purpose not to depend on one vendor. Both are hybrid. and the operators have learned something important. Renting out GPUs is not a sustainable business. Applications and AI services are. That makes the software that schedules and tunes the work the layer that matters and that is exactly where we sit. That brings me to what we are focused on most right now. The revenue that we produce and the margin we make on it. Let me take each one. First, revenue. We earn revenue in two ways. One is our silicon NSDK designed into OEM's product, shipping inside autonomous systems, robotics, and ruggedized equipment. Once we win the design, we scale with that OEM into markets they already serve. And the proven design opens other platforms and markets for us. The other is our hybrid AI platform, a vertically integrated stack. It runs the industry applications that customers buy, built by us and by our software partners. Service providers and system integrators deliver it as a managed service. Stephen will take you through where each of them stands. Second, margin. Behind both SIPs AI services are software suite for AI inference. We expect AI services to become an increasingly important contributor of our margin over time.

Today, AI services includes capabilities such as facial recognition.