iQSTEL Inc.

you for standing by at this time i would like to welcome everyone to the iqstell investor conference call to discuss q4 2025 and full year 2025 financial results all lines have been placed on mute to prevent any background noise after the speaker's remarks there will be a question and answer session if you would like to ask a question during this time simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. I would now like to turn the conference over to Ethan Walfish, Head of Investor Relations. Sir, the floor is yours.

Good morning, and thank you for joining IQStell's fourth quarter and full year 2025 earnings call. Joining me today, I am pleased to have Leandro Iglesias, Chief Executive Officer, and Alvaro Quintana, Chief Financial Officer. The recording of today's call will be archived and available in the investor relations portion of our website for a minimum of 30 days. During the call, we will make forward-looking statements such as dialogue regarding our revenue expectations or forecast for remaining quarters in the full fiscal year of 2026 and 2027. These statements are based on our current expectations and information available as of today and are subject to a variety of risks, uncertainties, and assumptions. Actual results may differ materially as a result of various risk factors that have been described in our periodic filings with the SEC. As a result, we caution you against placing undue reliance on these forward-looking statements. We assume no obligation to update any forward-looking statements as a result of new information or future events except as required by law. In addition, other risks are more fully described in the IQSTEL's public filings with the U.S. Securities and Exchange Commission, which can be reviewed at www.sec.gov. Yesterday, April 6, 2026, the company filed the SEC its Form 10-K for Q4 and full year 2025, and afterwards issued a press release announcing those financial results. So, participants of this call who may not have already done so may wish to look at those documents as we provide a summary of the results on this call. With that, I will now turn the call over to our CEO, Leandro Iglesias.

Thank you very much, Ethan. Thank you. Let's talk a little bit about the strategic overview of the company. And 2025 has been a year of strong execution and continued growth for IQSTEL. We have successfully expanded our global business platform, reaching approximately $316.9 million in revenue, representing 11.9% year-over-year growth, while strengthening our equity position by 37%. But more importantly than the numbers, we have built a high-scalable global commercial platform. Today, IQCELL reached over 600 of the largest telecom operators worldwide, has access to approximately 2.3 billion end users through our customers, operates across 21 countries and multiple regions. This is not just a telecom operation. This is a global distribution platform. Over the past year, we have grown from tens of million dollars in revenue to a current 400 million run rate revenue, building the foundation for the next phase of our company. We are entering nowadays in the new stage of the company that we named the transition of the company. This transition phase has the first phase was about the building the platform and scaling the revenue. And the second phase where we are today is about expanding the EBITDA and profitability. Our core businesses Telecom and Fintech are already generating over 2.7 million adjusted EBITDA, providing the strength of our model. Now also operating with clean capital structure with no convertible notes and no warrants. This gives us a very solid foundation to grow efficiently and create shareholder value. From operational perspective, we continue to improve bolts, scale, and efficiency. SMS traffic increased from 13.9 billion to 17.4 billion messages representing 25.18% growth, reinforcing our focus on higher margin services. At the same time, gross margin improved significantly, increasing 26.28% from 2.74% to 3.46%, driving by a better service mix, increased focus on higher margin segments, and operational efficiency improvements. Additionally, our company routing and platform consolidation strategy are contributing directly to margin expansion. I want to take a moment to emphasize what we believe is the most important asset of our company is our business platform. We already have trusted relationships with global telecom partners, a proven B2B sales engine, and a global footprint. This allows us to deploy new services globally, scale quickly without heavy investment, and increase revenue per customer. And this is what makes IQCell unique. This margin growth strategy, we are leveraging this platform to introduce high-tech, high-margin services, including artificial intelligence, cybersecurity, digital health. These services share key characteristics. All of them have recurring revenue models, higher margin, and strong scalability. And most importantly, they can deploy through our existing customer base. We don't need to build a distribution channel. We already have it. We are particularly excited about our entry into the digital health market. This is a multi-billion dollar global opportunity driven by aging populations, rising health care costs, and the shift toward remote care. By leveraging our telecom platform, we believe that we can become a key distribution channel for digital health services globally. Even under conservative assumptions, including penetration of less than 1% of our reachable base of 2.3 billion users, this represents a multi-billion dollar revenue opportunity over time. And this is a very important step in our transformation into a high-tech platform company. We will provide more details on this vertical in the near future. Looking forward, our strategy remains clear. Achieve $1 billion in revenue within the next 24 months, expand EBITDA through higher margin services, and continue strengthening our balance sheet. We believe that we are in very strong position to execute this plan. In summary, we have built the platform. Now we're expanding the margins and we are entering in a new high growth vertical. We believe that this combination creates a very compelling opportunity for long-term shareholders and value creation. Thank you.

Thank you, Leandro. From a financial perspective, we are pleased with our performance during 2025. For 2025, IQCell delivered another year of scale expansion and margin improvement, driving by discipline execution across all business lines. Revenue reached $316 million, up 12% year over year, with QXCell contributing 39% of total revenue and validating our acquisition strategy with immediate material impact. Our gross margin increased 14 percent, raising to $9.46 million, supported by a decisive shift toward higher margin SMS and FinTech revenue, as well as routing efficiencies across the group. SMS volume surged 25 percent, reinforcing this margin trajectory and positioning us for continued expansion. Telecom remained a profitable engine, generating $1.9 million in operating income, while FinTech delivered $27.9 million in its third full year, an important diversification milestone that strengthens our revenue mix and reduces dependency on legacy voice. We closed the year with positive working capital of $1. $56 million, a stable liquidity position, better operational controls across subsidiaries, integration synergies from QXTel and Globetrotter are already following through P&L, and we expect additional leverage as we scale artificial intelligence commercialization. Our financial posture is clear. We are growing. We are expanding margins. We are building a more diversified higher quality revenue base. The foundation is in place for continued acceleration. We remain focused on operational discipline, efficiency, and profitability.

Thank you, Alvaro. And with that, we are now ready to take questions. Thank you.

We will now begin the question and answer session. If you would like to ask a question, please press star then the number one on your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, simply press star one again. Your first question comes from Barry Sine with Litchfield Hills Research. Your line is open.

Hey, hello, gentlemen. Couple questions, if you don't mind. First of all, very exciting announcement on digital healthcare. And I'm looking forward to the additional details, but a couple questions on that. So if I think about that market, obviously a huge market, one opportunity is obviously telemedicine, although you do need to have, still have a human licensed doctor on the other end. You talk in your announcement about data over IoT devices for healthcare monitoring and also predictive technology. Could you give us a little more, and I guess you're going to, you know, roll out more information at the telecom conference in May in Washington. Could you give us a little more information on, you know, what you're looking to do, what those services are likely to entail? Will they be telemedicine?

You know, what are you looking to do in healthcare? Thank you, Barry.

Thank you very much for being here and asking this question. We are really excited about this opportunity. We are in the process to add in value to our current business relations that we have with the largest telecommunications companies around the world. And basically, one of the things that we identify is that all of them went for needing services for the aging people in order to supervise, you know, the information, the signal, the vehicle signals of the aging people, where they are, if they, you know, sleeper in the floor or something. And in that sense, we, today, we issue press release because we reach an MOU with a Taiwan company that is providing not only the technology, they provide the devices for, you know, for all the Asian people that basically, you know, they are entering in, gathering the information using the telecom networks and offering to the end users in the telecom, in the mobile users to using like a watch or another devices, gathering information about all the, the, vital information and gather this information into an AI platform and analyze the situation and call to emergencies or asking for, you know, supervising and this kind of services is that we are going to offer. At this point, we reach an agreement or regular agreement with this company. We are working on the products and services and we are planning to launch them in 40 days in the International Telecom Week in Washington. And our idea is to offer to our customers, you know, a solution for they can offer to the end users and, you know, taking advantage that we have built these relations that our customers trust in us. And we are going to offer something very valuable for the end users, you know, that is, you know, collecting data and monitoring the health of the aging people. So that's the strategy that we are following. At this point, you know, we are working in the portfolio of products that we are going to launch and preparing all the marketing materials. But, you know, we are really excited about this opportunity, Barry.

Let me add something about this, Barry. Remember, we have 600 interconnection agreements with the biggest mobile and telecom operators around the world. They serve 2.3 billion end users. So just imagine the huge opportunity that we have here by providing our the telecom operators the opportunity to pass through their end users these kind of services and devices. This is where the opportunity lies.

Okay. That's very helpful. I wanted to also ask a question. If we look at the results that you've just reported, and I haven't read the 10-K yet, seen the 10-K yet, and that'll have a lot more detail. Over the last couple of years, you've done a number of acquisitions. I don't know if my number is right, but I count nine major acquisitions. And you still, when we talked, they were different software platforms. You were looking to, first of all, get everything onto an integrated voice platform. Then you were going to do SMS next. If you could give us a sense of where we are on that integration process, What are the financial impacts? Are there still margin improvements to come in 2026 and future as a result of that integration? Is it all done? And then also on, you know, on those prior acquisitions, you have a lot of acquisitions where you initially bought 51%, but you have the rights to go up to 49%. Where are we on that process? And particularly, the one I'm really interested, obviously, is QXL. So if you could talk a little about that, please.

Sure, but listen, this is not a question. This is like three questions. We are going to try to address all of them. Listen, you know, our first, let's start talking about the minority interest acquisition that we are in the process to perform. In some of the companies that we acquired at 51%, we have been working with them in the process to complete the acquisition of the minority interest because our vision is to create one single big corporation with all the services in order to reduce the technical and technological platform costs, reduce the executive payroll increase the synergies, maximize the opportunities between the different markets and different traffic that we have in the switch. So this is something that we are in the process and we are going to execute this plan this year. Our idea is to close those acquisitions and we have the goal to take the control about the 100% and the companies that is going to represent the 95% of our revenue and the 95% of our EBITDA and net income and cash. So it is something that is going to happen, is plan to home going to happen this year. And this is something that is very valuable to us in order to gator all of our operations and create the maximum facilities possible. But at the same time, we have been working on getting one single platform for all the subsidiaries. At this point today, we have three full subsidiaries running in the same platform, that is Quextel, Epelix, and Switzerland. They are running in full in the whole business for the voice, and we are moving the SMS business too. This year, that's the plan. So we are going to have like the 95% of the revenue and the EBITDA in one single platform too. So our idea is clear, is to create a corporation having everything in one platform and increase the synergies and reduce the cost. The initial impact that we have predicted for having all the companies in one single platform is in two avenues. The first avenue is in cost reductions about the technological side. And the second avenue is about the synergies that you are going to create, you know, and having this seamless management through the different companies and interconnections and all the things. Listen, we have been doing this process for almost a year. We started in 2025, and this process has been a complex process. Remember that when we say that we have 600 high-value interconnections with the largest telecommunications companies around the world, we are talking about technical interconnections, security standpoints, commercial standpoints, agreements standpoints. So to move everything to one single platform is something that we started. And listen, we don't want to miss anything of the opportunities in this process. And this has to be done seamless in order for our customers and our vendors And our, you know, our employees too. So at this point, you know, the plan is having the 100% of the companies for the 95% and 95% of the revenue and the EBIT and the net income. And the 95% of the revenue is going to be in one single platform. And we are in this process. And, you know, I'm giving you a number that is, you know, our... expectations. I believe that Alvaro could drill down this number, but we think that we are going to save around $500,000, half a million dollars per year just in savings and cost reductions for having everything in one single platform. I don't know, Alvaro, if you can give more details about all this strategy.

Sure. There is a figure that you will see in the 10K that is the intercompany revenue. It's showing in a couple of tables in the 10K. And that number went from $22 million in 2024 to $41 million in 2025. So we almost double the business that is being done among all our subsidiaries. That means, in practical sense, that, for example, is sending traffic to Switzerland or QXL or Wizzle or SmartBiz, taking advantage of better cost termination and better quality. So that's a clear example of how we are managing the synergies among all our subsidiaries. That is also impacting our gross margin percentage that increased 26% from 2024 to 2025. So synergies are there. We are proving our business model is working. And as Leandro mentioned, we are just in the first phase. Now we are implementing reduction in operational costs, administrative costs. finalizing the integration in just one switching platform for all subsidiaries or most of them. So I think the numbers are rare and are already impacting our financial results.

Okay, that's very helpful. My next question, you have recently publicly laid out a roadmap for acquisitions in 2026. And Leandro, I know that in the past, almost all of your acquisitions, maybe all of them, have been of companies where you've been in the business for many decades and you've made a lot of relationships. And most of the acquisitions in the past have been companies that were run by people that you've known and worked with for many, many years. Is that still the model? And then, you know, the acquisitions that you've laid out, you know, for this year, Are you still leveraging that? And then how many more of these do you have in your back pocket that you could, you know, pull the trigger on, you know, companies where you know the CEO, you work with them, and you could grow the companies through acquisition?

Thank you, Barry.

You put me in a tough situation telling this to the... Let me try to say, answer this without saying something you know, that I cannot say. Well, listen, the path of our company is clear. We have the intention to you know, acquire a couple of companies and we have the goal to reach the $50 million EBITDA run rate for this year. So to do that, we have two acquisitions in the radar. One has been already negotiated. We are entering in the purchase agreement, but it's something that we are going to do this year that is going to be a new thing and for the shareholder is when we are going to send a proxy to the shareholder explaining all the economics behind this acquisition to get the approval from them. That's the first thing. So, but each of them is going to add around $5 to $6 million EBITDA. And, you know, in both case, we are talking about three to four years Payment terms, contingency to results. So it's something that is not going to put pressure in our cash flow and is going to be very manageable for us, those acquisitions. And in one of the companies is the same case. Barry is people that I have been working for with them for 10, 15 years. And the other is a company that we have been introduced by one of our subsidiaries and has a very, very strong value because it's going to add, like, eight countries in penetration and something, and we are really excited about this process. But listen, the new here in this process is that we are going to file this in a proxy and explaining to the shareholders that what is going to be the decision and what economical is going to be with this acquisition, and they are going to vote about this. And we are in track on this. Listen, we have like, you know, the current business that we have, we are in the process to having all the business move to one single platform, the minority interest acquisition, and third one, complete those acquisitions with this. And listen, the big picture of this is that this picture is going to be that we are going to have present around 30 countries around the world, and we are going to have like spits 50 to 700 largest interconnections and business relations with the largest telecom companies around the world. And we are really excited about this, you know, all this process and everything. But listen, If, you know, we have been working like in telecommunications, adding FinTech services at the same time, we have a lot of product and services with AEI that we have launched and we start to generate, you know, the traction, the commercial traction for them because we only, we want to be perceived by the market like a high tech telecommunications company. And we are adding AI services over our current services. But more than this, in this event in Washington, we are going to launch our cybersecurity solutions for the telecom industry because we have a sibling company that is Securium that we are going to use their platform to sell to our customers too. And in addition, we are going to to launch our digital health services too. So we are in this process of growth, creating new verticals and taking advantage of the business relations that we have. If I have to say something, you know, summarizing like a pitch elevator about our company, our company is way more than a telecommunications technology company. Our company is a very sophisticated business distribution channel around all the largest telecommunications companies around the world that we have been building these relations for years, selling millions of dollars, they trust in us, and this is the right time to take advantage of those B2B relations with the top executives on those companies and start offering high services, high technological services and high value, high margins. And, you know, we are like in this point that the company is going to, you know, start to generate new revenue streams with high margin. And we are really excited about all this process. In addition, of course, of the things that I said about the acquisitions and growing our current business and improving the platform and everything. We are in this, you know, turning point for the company, for the growing and the things that we are going to be because, you know, we have We have something very valuable. Listen, you have maybe to try to build all those relations and maybe you need years and invest millions of dollars, you know, to try to build those relations. And this is the business relation that we have is the real value of our company nowadays. And it's going to be in right now, the management is working to take advantage of this and explore it. Alvaro, I don't know if you want to add anything at this point.

No, I think you summarized it very well.

And one more question, if you don't mind. Leandro, you just mentioned that you're looking to have a presence in 30 countries. One of those countries, Venezuela, is obviously very important to the company as well as to the executives personally. And we've seen some very positive changes recently in Venezuela. Do you see opportunities as a result of the changes that are happening in Venezuela that IQSTAL can take advantage of?

Sure. Well, listen, when we were talking about 30 countries, we are thinking, you know, in eight, nine countries in other continents. different than America. But, you know, Venezuela is a particular case because, you know, Alvaro and I were born in Venezuela, even though I moved from Venezuela 12 years ago. I have been living in another country, in Spain. So because Spain is like the center of our operation because we have operations in in 21 countries and strategically for the operation. But talking about Venezuela, at this point we are exploring things and we have been evaluating to start to exploring what are going to be the participation of IQ-State could have in Venezuela nowadays. To be completely honest, all the meetings that we have had, they see that being a NASDAQ U.S. company for the current political trend that Venezuela has is a strength, to be completely honest. But listen, we want to, whatever we are going to do in Venezuela is something related with, you know, technology, in high technological services, high margin services, and we want to be sure that, you know, it's going to be a solid step, whatever we're going to do. But of course, Barry, to be completely straightforward, we are evaluating this, but we haven't start with this, bring this to the Board of Directors, yes, because we want to have the whole plan developing before to start moving ahead. It's just a thing that we are evaluating so far. I don't know, Alvaro, because this is part of the things that you are leaving that you can say about this.

We are keeping an eye on the situation of how it's been developing. Of course, we have direct contact with CEOs and the C-levels in the telecom operators in Venezuela. We used to do business with them, with all of them in the past. And of course, the opportunity is there, and we are going to take advantage of our knowledge of the market and our connections. And of course, if that brings value to our business, we are going to do it for sure.

Okay, thank you very much, gentlemen. Those are my questions.

Once again, if you would like to ask a question, please press star, then the number one on your telephone keypad. That concludes our question and answer session. I would now like to turn the conference back over to Leandro Iglesias, President and CEO, for any further remarks.

Thank you.

I truly believe You know, I want to say something to take away of this call. And, you know, we are in the process to improve the communications with our shareholders and creating value for our shareholders. We added a professional IR firm to improve the communication. And we promised that we are going to start to give in this earning calls in a quarterly basis with the intention to having the opportunity to all the shareholders asking us about the company and everything. And we are going to be keeping working on this path. But listen, to take away of this call, I want to say something. We have been developing this great company that we have, creating 600, business relations with the largest telecommunications companies around the world. And we have the 2.3 billion of end users to reach through them. And more than this, I want that you see more than a telecommunications company that is entering in fintech and other technologies. Check yourself, like, you know, powerful distribution channel to the largest telecommunications companies around the world to offer them high tech, high margin services. Listen, we already have in in the company things that maybe you need years and millions of dollars to invest to create those relations and maybe you you cannot make it and we already have in the company and we are right now in the process to taking advantage of all those relations improving values added services and high technology services to our customers and we are really excited and we are pretty sure that you know Sooner than later, the market is going to understand that the real value of our company is not just the revenue and all the things that we have. commercial business platform that we have, a digital distribution channel, and we are really excited about, you know, the launch of cybersecurity in 40 days and the launch of digital health services, because in the case of digital health services, and we issue a press release today about this, it's a multi- using conservative projection is a multi-billion business opportunity for us. And we are in this point where the company is going to turn in the corner and start growing the business in a very fantastic way. And over the next months, you are going to see the transformation where the company is nowadays, where the company is going to be becoming in a $1 billion revenue company. And we are really excited because of the moment that we are living nowadays. Alvaro, do you want to add anything?

So basically, say thank you to all the people that joined the call. We are very pleased with your presence here. No, we are working hard, continue doing business every day for the good of our shareholders. And basically, thank you for your support and for looking after our company. Goodbye, everybody.

Goodbye, and thank you very much for supporting and attending to this earning call. Thank you.

This concludes today's call. Thank you so much for attending. You may now disconnect and have a wonderful rest of your day.