SEALSQ Corp

Greetings, ladies and gentlemen, and welcome to the CLSQ fiscal year 2025 financial results earnings conference call. As a reminder, this conference call contains forward-looking statements. Such statements involve certain known and unknown risks, uncertainties, and other factors which could cause actual results, financial condition, performance, or achievements of CLSQ to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. CLSQ is providing this communication as of this date and does not undertake to update any forward-looking statements contained herein as a result of new information, future events, or otherwise. These risks are also discussed in our filings made with the Securities and Exchange Commission. Please be advised our fiscal year 2025 earnings release was issued on Tuesday, March 31st, 2026. Also, our Form 10-K for the full year ended December 31st, 2025, which was filed with the SEC on Tuesday, March 31st, 2026, can be found by visiting the Investors section of CLSQ website at https://investors.clsq.com/. At this time, all participants are in listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It's now my pleasure to introduce Carlos Morera, Founder and Chief Executive Officer of CLSQ. Mr. Morera, please go ahead.

Thank you very much, Kevin, and good morning in the United States and good afternoon in Europe to everybody. Welcome to a full year 2025 earnings call. I am joined today by our Chief Financial Officer, John O'Hara. I'll begin with an overview of our key highlights and major developments from the year. John will then walk you through the financial results in more detail. After that, I'll return to share our outlook for 2026 and beyond, and we'll conclude by opening the line for your questions. 2025 was a defining year for CLSQ. It was a year where we stepped decisively into the role we had been building towards science or founding that of the wall leading platform for post-quantum secure semiconductor and trusted digital infrastructure. Every investment product lounge and partnership this year advances one central thesis that the quantum thread to encryption is real. It is accelerating and hardware rooted post-quantum security is the only durable answer. Let me walk you through those accomplishments one by one. In October 2025, CLSQ market valuation surpassed $1 billion, and we achieved an upgrade to the NASDAQ Global Select Market, its highest tier. This reflects our growing scale institutional governance standards and investors' recognition and our positioning at the intersection of semiconductor cybersecurity and quantum resilience. Since November 2024, we have raised more than $530 million in capital, providing us with a substantial financial flexibility to accelerate our growth strategy and deepen our investment in innovation. This funding strengthens our balance sheet and enables us to scale product development, expand our commercial reach, and support the industrialization of our next-generation secure semiconductor platform. It also positions us to advance key strategic initiatives, including post-quantum product development, certification programs, and potential partnerships or acquisitions that we can enhance our technology capabilities and market presence. I will provide more detailed color shortly on our use of capital and how we are allocating these resources to drive long-term value creation. I will start with our QS7001, the world's first post-quantum semiconductor. The most consequential milestone of 2025 was the commercial launch of the quantum shield QS7001 in Q4. This is the most first commercial available secure semiconductor embedding NIST standardized post-quantum cryptography algorithms such as ML, MLA, KEM, and MLADSA directly in hardware delivering up to 10 times higher performance than PQC software implementation. We unveiled the QS7001 at the IQT Quantum and AI Conference in New York in October and formally launched development kits at Las Vegas Grand Prix in November. The pipeline on QS701 and QVolt TPM has already grown to over 60 million for 2026 to 2029, up from approximately 11.4 million at the same point last year. I will now discuss the CLSQ Made in U.S. strategy and recent development. The U.S. government and enterprise market increasingly requires root of trust, PKI infrastructure, and cryptographic provisioning on American soil driven by national security imperative and regulatory mandates. In November 2025, we launched a sovereign U.S. post-quantum root of trust, the first of its kind, marking a foundational milestone in or made in U.S. strategy. This initiative ensures that the entire trust chain from silicon design to cryptographic provisioning can be executed within the United States under the highest level of certification and control. To operationalize this vision, we engage Trusted Semiconductor Solution, TSS, as our U.S. manufacturing and distribution partner, and establishing a U.S.-based secure personalization hub in 2026, reinforcing supply chains' sovereignty and resilience. These strategies further strengthen through key partnerships. Collaboration with Lattice Semiconductor enables the integration of low-power FPGA technologies supporting flexible, secure, and post-quantum ready hardware architectures for defense, IoT, and HAI applications. At the same time, engagement with PyroDrone extends secure route of trust capability into autonomous and defense-grade UAV system, where cyber resilience and trusted communications are mission critical. Trusted Semiconductor Solution, TSS, a Category 1A trusted accredited company meeting the highest standard for handling classified emission-critical macroelectronics, has announced a strategic partnership to co-develop made in U.S., PQC-enabled semiconductor, secure semiconductor solution. These solutions are designed to reach the highest level of hardware certification required by U.S. defense and government agencies. Leveraging TSS established a relationship and trusted position within the U.S. defense ecosystem. This collaboration has strengthened CLSQ footprint and accelerated access to sensitive national security market. TSS serves as a critical interface to U.S. agencies, insurance compliance with the Department of Defense, DOD, and federal requirements, while enabling the development of CLSQ quantum-resistant silicon, question chip design, advanced certification, and secure personalization technologies. Eeroq represents the quantum computer layer of this long-term vision. It is electron-on-elion approach enables quantum processor as small as a thumbnail and compatible with the standard semiconductor manufacturing processes. This breakthrough aligns directly with the objectives of building an end-to-end sovereign quantum security stack, bringing today post-quantum cryptography chips with tomorrow quantum processors. The follow-on investment in February, 2026 reflects a strong conviction in this trajectory and reinforces the strategic position and the intersection of semiconductor cybersecurity and quantum computing. By combining US-based manufacturing and personalization through TSA's programmable secure hardware via Lattice semiconductor trusted autonomous system with PyroDrone and future quantum capabilities enabled by EE Rock, we are establishing a vertical integrated sovereign and quantum resilient security ecosystem tailored to the most demanding requirements of U.S. defense, critical infrastructure, and next generation AI system. Our total activity, sorry, our total active pipeline across all products stands to an estimated 200 million in March 2026. We published a certification roadmap confirming all the products variants, which are QS701V1, QS701V2, QVolt TPN183, and QVolt TPN185. which are on track for CCEA L5 plus FIPS 140 Slot 3 and TCG certification through Q4 2026. While our customers are actively testing development kits and progressing through the design in progress, signaling strong engagement and readiness for adaptation, we see that gating factors for conversion to revenue are twofold. First, is the certification completion or CCEAL 5 and FIPS 143 milestones remain on track through Q4 2026. And customers in regulated sectors typically require these certifications before committing to volume purchases. As already mentioned, the laboratory has confirmed that the common criteria evaluation required to achieve evaluation assurance level EAL5+, namely fault injection on side channel attacks, passed its March certification as anticipated. Second, integration cycles in the semiconductor industry, the path from design into full production usually spans six to 18 months. We are actively accelerating this timeline through co-development, partnerships, and close collaboration with customers, shortening the time from prototyping to deployment. Critically, regulatory pressures such as the CNSA 2.0 in the United States and the European Union Cyber Resilience Act are creating tangible urgency. These deadlines are not theoretical. They are influencing procurement decisions today, and we are seeing This urgency directly reflected in commercial conversations driven faster designing and a strong early adoption. This combination of mature pipeline, accelerating integration and regulatory driven demand position has well for meaningful near-term revenue growth while laying the foundation for continued expansion through 2028. Now moving to acquisitions, In 2025, we completed the acquisition of IC-ALP, SIS, SU, a leading ASIC design specialized company based in Grenoble and Toulouse in France. This added approximately 100 high-skilled engineers, bringing our global workforce to approximately 300 people. IC-ALP brings expertise in custom chip design for healthcare, automobile, and IoT, and position host to develop the Quasic, which is the quantum ASIC, a purpose-built post-quantum cryptographic ASIC. ASIC revenues also grew from 1.4 million in Q3 to 2.2 million in Q4, confirming the value of this acquisition. Additionally, last month, we signed a letter of intent to acquire 100% on MiraX, a Swiss developer, or photonics-based quantum interconnected solution. MiraX represents a key strategic asset in completing our quantum vertical stack. Its technology provides a critical interconnect layer linking quantum computing networking and post-quantum cryptography into a unified architecture. Once completed, the acquisition is expected to accelerate our QSOC initiative and strengthen our ability to deliver resilient end-to-end quantum security infrastructure across both terrestrial and space-based environments. Another key milestone in the establishment of our Quantum Fund and the strategic investment made through it, our Quantum Fund launched in 2025 with a $20 million initial allocation has grown now to 200 million as today. We deploy approximately 30 million across ICI-Alps, Colibri TD, EROC, YSAT, Quantics Edge Security, and the WeCan Group, each reinforcing our quantum vertical from silicon to space. On November 2025, investment in EROC deepened with a follow-on in February 2025. It's particularly strategic. EROC is building a quantum processor based on single electron on superfluid helium. A design approach that yields processor as small as a thumbnail manufactured on a standard semiconductor processes. This underlines our made in U.S. vision and our long-term root to qubit ecosystem. The U.S. government and enterprise market increasingly requires root of trust, PKI infrastructure, and cryptographic provision on American soil In November 2025, we launched a sovereign U.S.-based post-quantum route of trust, the first of its kind. We engaged Trust Semiconductor Solutions as U.S. manufacturing and distribution partner, and we are building a U.S. personalization hub in 2026. EROS is the quantum computer layer of this vision. Their electron-on-alien approach allows processors as small as a thumbnail to be manufactured on standard semiconductor processors directly aligned with a long-term goal of an end-to-end server and quantum security stack from post-quantum chips today to quantum processors in the future. The follow-on investment in February 2026 reflects our conviction in this direction. All these advances tie well with our quantum highway global expansion strategy. We advanced our quantum highway, linking industrial capabilities around several locations like Murcia, Toulouse, Grenoble, Geneva, and Chicago, connecting Spain, France, and the United States, and Switzerland. In September 2025, we signed a 40 million euro joint venture with the Spanish government to establish quantum age security. in a city located in the southern part of Spain, Murcia, Spain's first post-quantum semiconductor personalization center. We are establishing two additional hubs in the U.S. and in Asia in 2026. In November 2025, we launched a sovereign U.S.-based post-quantum route of trust, enabling U.S. government agencies to manage quantum-secure digital identities in U.S. soil. In November 2025, CLSQ invested $10 million in YSAT to develop a quantum secure satellite infrastructure platform. The contemplated model is based on an anticipated revocable right of use over 12 satellites. YSAT will remain ownership of the operation, while CLSQ will secure dedicated capacity for quantum spatial orbit cloud initiative. delivering quantum key distribution, quantum random number generation, and post-quantum identity services as a subscription offering to enterprises and government. The YSAT 3.0 launch in June 2025 already included a proof of concept for sealed coin machine-to-machine transaction secured by your semiconductor stack. While there cannot be no assurance that the contemplated arrangement will be completed on currently anticipated terms, We believe this represents a significant long-term opportunity as the world's first quantum secure orbital cloud. I am turning now the call to John, who will discuss financial results for the year 2025. Go ahead, John.

Thank you, Carlos, and hello to everybody on the call. So, CLSQ delivered total revenue of $18.3 million in fiscal year 2025, representing growth of 66% compared to $11 million in 2024. This was driven by two factors. First, a strong recovery in our core semiconductor segment, which grew to £14.7 million from £11 million in the prior year. And second, the addition of our new ASIC segment, which contributed £3.6 million following our acquisition of IC Alps in August 2025, representing five months of consolidated revenue. Within the semiconductor segment, we saw particular strength in our smart card reader SCR200 product line, which delivered 51% revenue growth year-on-year, driven by expanded deployments at key customers. Our secure element product lines, notably the VIC-405 and VIC-408, also saw significant demand growth in smart metering and secure communications applications. Trust services, which include our PKI and provisioning solutions, grew by almost 600% year on year, though from a small base and currently represent just 2% of total revenue. Geographically, North America remains our largest market at 57% of revenue. We are pleased to report strong momentum in particular in Asia Pacific, where revenue grew 95% year on year, driven by adoption of the MATA protocol in smart home and HVAC applications. We also recognize some small revenues relating to sampling of the QS7001 quantum resistant chip as clients commence their first testing of this product. And we expect first production revenues from the QS7001 in the second half of 2026. Gross profit improved substantially to 8.6 million in 2025, up from 3.7 million in the prior year, with gross margin expanding 13 percentage points to 47%. This was primarily driven by the addition of the ASIC segment, which carried significantly higher margins at 88%, reflecting the design service nature of that business with low directly attributable costs. Semi-conductive segment gross margin partially recovered to 37%, up from 34% in 2024, as shipments of new products to our existing customer base resumed following a period where customers were drawing down their own inventory. Total operating expenses were £48.4 million in 2025 compared to £20.9 million in 2024, an increase of 132%. However, I want to be clear about what is driving this increase as context matters significantly here. The single largest factor is a non-cash stock-based compensation charge of £11.2 million. Following the significant change in CLSQ's market capitalisation since our original listing, Management made the deliberate decision alongside the compensation committee to issue equity awards to our staff and senior staff as recognition of their commitment and to align their interests with our shareholders. This is a one-time accounting charge with no cash in. Beyond that, the increase in operating expenses reflects three structural changes in our business. The consolidation of five months of ICL operating expenses following the August acquisition. the build-out of our own management team with C-suite and central functions that were previously provided by our parent, Wisekey, now directly employed by CLSQ from January 2025, and continued investment in research and development and sales and marketing to support our post-quantum product roadmap. Net of stock-based compensation, in particular R&D expenditure, was $10.1 million, representing 25% of our total operating expenses and reflecting the investment required to bring our Quasar post-quantum product program to commercial launch. The net loss for the year was 34.2 million compared to 21.2 million in 2024, and a meaningful offset to our operating loss came from the non-operating income of 8.9 million, the majority of which, 6.1 million, was interest income earned in our substantial cash balance throughout the year. Turning to the balance sheet and liquidity, we ended the year with cash and cash equivalents of 417.7 million, with short-term investments of 10 million on top of that, which was up from 84.6 million at the end of 2024. Working capital was positive at $421 million. This cash position is a result of highly successful equity capital markets activity throughout 2025. And in aggregate, since November 2024 until the current date, CLSQ has raised over $575 million in cash for a series of registered direct offerings, warrant exercises, and our at-the-market facility. This puts us in a genuinely strong position to execute on our strategy in the years ahead. And Carlos will come back to that later in the course. Operating cash outflow for the year was £31.3 million, reflecting our continued investment phase. Investing activities consumed £35.3 million, primarily comprising our acquisitions and strategic investments, including the acquisition of IC Alps, our investments in Aeroq, YSAT, the WeCan Group, and Quantixx Security in Spain. Total debt at the year was a modest £1.7 million, all of which relates to French government-supported loans acquired with IC Alps. The balance sheet is therefore essentially debt-free at the parent company level. Based on our cash projections through to March 2027, we've confirmed sufficient liquidity to fund operations and the business is not dependent on further capital raises for its immediate operational continuity. Moving on to our balance sheet, total assets grew to over 500 million at the end of 2025, principally reflecting the increase in cash. Non-current assets grew from 4.5 million to 54.5 million which was driven by the IC Alps acquisition, which added 5.7 million of goodwill and $21 million of intangible assets net of amortization, as well as our strategic investment portfolio. On the other hand, total liabilities were 42.7 million at the year end and the cumulative deficits that 76 million up from 41.9 million the prior year, reflecting the net loss for the period. Looking to 2026, there are a number of important milestones we are targeting. On revenue, we expect fiscal 26 to represent a year of acceleration. The ASIC segment will contribute a full 12 months of IC-ALPS revenue for the first time. We anticipate the first production revenues from the QS7001 and the QVolt TPM in the second half of 2026. The estimated combined pipeline for these two products is at 60 million as of December 31st, 2025, and as of today, and that's across approximately 115 potential customers. Just for clarity, This is a management estimate and is subject to convert conversion risk, customer validation, timelines, and the certification process. Our DX venture is expected to continue to increase in 2026 with a particular focus on our post-quantum cryptography roadmap and the build out of our test and personalization infrastructure in Spain and prospectively in the United States and Asia. Finally, we expect to continue executing on our strategic investment program. The quantum fund has a total allocation of 200 million of which we have spent just over 30 million to date. We will continue to evaluate opportunities in quantum computing, quantum as a service, and secure semiconductor technologies aligned with our roadmap. We have 530 million in cash generating meaningful interest income, and we are investing from a position of strength. The path to profitability we believe runs through revenue scaling, with a $200 million pipeline for 2026 to 2029, revenue expected to grow by between 50% and 100% in 2026, Q1 expected to more than double year-on-year, and gross margins firmly trending upward, we are confident in that trajectory. Now I am turning the call back to Carlos, who will provide additional details on our growth strategy. Carlos, please go ahead.