LightPath Technologies, Inc.

Good afternoon, ladies and gentlemen. Thank you for standing by. Welcome to the LightPath Technologies first quarter fiscal 2025 earnings conference call. During today's presentation, all parties will be in a listen-only mode. Following the presentation, the conference will be open for questions. This conference is being recorded today, November 7, 2024, and the earnings press release accompanying this conference call was issued after the market closed today. On our call today is Lifepath CAO Sam Rubin and CFO Al Miranda. I'd like to remind you that during the course of this conference call, the company will be making forward-looking statements that are based on current expectations, involve various risks and uncertainties as discussed in its periodic SEC filings. Although the company believes that the assumptions underlying these statements are reasonable, any of them can be proven to be inaccurate and there could be no assurance that the projected results would be realized. In addition, references made by may be made to certain financial measures that are not in accordance with generally accepted accounting principles or GAAP. We refer to these as non-GAAP financial measures. Please refer to our SEC reports in certain of our press releases, which include reconciliations of non-GAAP financial measures and associated disclaimers. Sam will begin today's call with an overview of the business and recent developments for the company. I will then... view financial results for quarter and the full year. Following our prepared remarks, there will be a formal question and answer session. I would now like to turn the conference over to Sam Rubin. Sam, the floor is yours.

Thank you, operator.

Good afternoon to everyone and welcome to LightPath Technologies' first quarter fiscal 2025 financial results conference call. The first quarter of 2025 demonstrated our continued transformation from a pure component supplier to a system provider, delivering new products, contracts, and ongoing growth driven by these incremental product lines. Just over three years ago, we set on a fresh course with a new strategic direction, taking us from being a pure component supplier to a solutions provider. we've laid out three pillars of growth of which our business is built upon. The first is our proprietary cameras and optics. Second are solutions for government and defense. And the third are new commercial applications. For those not familiar with our history, I will provide a brief overview. Prior to this shift, Lightgraph has been, for the greater part of 30 years, an optical component provider. What many years ago was a unique technology, molded optics, has become now a crowded marketplace going through the classic transformation and commoditization. As a result, LightPath's core business was eroding, unit prices decreasing, with them margins and profits. In 2021, we set a course on a new strategic direction, one that leverages some of our key technologies to deliver subsystems and system-level solutions instead of simply just components, which drive higher ASPs and ultimately gross profit dollars. This transformation has been very successful for us, and in this quarter, we reported that 30% of our revenue came from those activities. This type of revenue was much less significant for us before we began going down this path. Through our investment in differentiated technology, we have positioned ourselves as a leader in the field of infrared optics. With an exclusive license from the government to commercialize new materials developed at the Naval Research Lab, as well as our partnership with Department of Defense, Defense Logistics Agencies, with the goal of replacing germanium in DoD applications, we are not only the go-to partner for anyone looking to phase out germanium, but have also earned ourselves a seat at the table at some of the most important discussions and projects in today's defense world. Four years ago, we could only have dreamt of being in such a position. Naturally, Since these are defense programs we're talking about, we're a bit limited in what we can share, but we will try to share as much as possible. Recently, the DoD, via Defense Logistics Agency Strategic Materials, has awarded us Phase II funding to support the qualification of additional new black diamond chalcogenide glasses as a substitute to germanium. Phase 1 was significant success, resulting in the qualification of several new proprietary black diamond materials. These materials are now designed into multiple programs of record and demonstrate significant additional value beyond simply replacing germanium. In Phase 2, we will continue working with DLA to qualify additional black diamond glasses to be included in DoD systems. The validation this represents cannot be understated, as it directly translates to new defense programs that rely on our glass, for which we are the exclusive supplier of record. During the quarter, we also received an initial development contract from a new European defense customer for the use of black diamond glass in optical systems. Additionally, we also received a follow-on order from a European defense customer for infrared assemblies for use in FPV, that is first-person view drone application. These orders are enabled by and are a validation of our recent efforts to obtain a European defense license and build capabilities at our Latvia facility, as well as highlight our growing recognition as a trusted supplier within NATO-aligned regions. As a reminder, more than 30% of our sales come from defense, most of those in the US. Obtaining the European defense license now opens the door for us to grow our defense business in Europe too. And those two recent wins are lead indicators to the success of this strategy. We expect to see significant growth coming from this market, European defense market, and some customers they are potentially turning into 10% customers. In addition to our investment in materials and differentiating technologies, we have also invested in development of our camera technologies. Just over a year ago, we completed the acquisition of Visamit Technologies, integrating their expertise with our proprietary materials to develop advanced thermal cameras and imaging systems. We have now built a portfolio of unique thermal cameras that have created a strong entry point for us in the system-level product and enables us to carve out a market share in a market estimated to be $9 billion of TAM and growing rapidly. Our efforts in the camera business, our first pillar of growth, are focused around LightPath's unique camera solutions. This started with the introduction of Mantis, an innovative broadband or multispectral infrared camera that is the first of its kind and enabled purely by our unique materials from NRS. Mantis opened doors with several high-profile customers, establishing our reputation for producing cameras that are not only groundbreaking in design, but also practical for applications in harsh and high-sensitivity environments. And with a price tag of $30,000, we're positioned as industry leaders from a cost-to-performance perspective. This is significant for future growth of the company, as selling hundreds of cameras at $30,000 each has a completely different math to our top-line growth than selling just the lenses that go into those cameras, which can cost about as little as a cup of coffee, which used to be our business model prior to this transformation. In addition, we recently launched our new optical gas imaging camera platform to detect fugitive gas emissions for oil and gas industry. The new OGI camera is specialized technology using infrared cameras to detect and visualize gas emitted such as methane in industrial settings. OGI cameras are capable of visualizing gas that are invisible to the naked eye. by detecting the infrared energy absorbed or emitted by those gases. The topic is of extreme importance to the oil and gas industry, both in the US and Europe, following new regulation curbing those emissions and imposing high penalties on operators. LightPath's purpose-built OGI camera leverages a non-germanium lens to improve upon current technologies by offering a cost-effective, higher sensitivity, and ultimately more effective solution. This OGI technology applies to other sectors as well, where we see the opportunity to launch additional incremental products, leveraging our know-how, all without incurring significant development expenses. On the government and defense side of the business, our second pillar, we've seen traction pick up significantly. Similar to the materials technology differentiators that already landed us one program of record, our technology differentiator has landed us the Lockheed Martin missile program. Under this program, we are developing a new camera system for Lockheed Martin that will be part of a missile system. Due to pressing needs from Xerox Army, the customer, the program is now on a very accelerated timeline. Though it started only a year ago, we have already achieved a worthy qualification of our subsystem and can begin shipping units for flight tests, which the team is currently working on. The Lockheed Martin program is potentially transformative for Lightpath. Not only is it exactly the type of business we were targeting in our new strategy, but the size of the opportunity can completely transform us. If Lockheed Martin wins against Raytheon, which they are competing against, we could expect to see revenues of between $50 million to $100 million a year once in full production. Though we are still in development, the progress of this project is so fast that Lockheed and the customer are already looking to start setting up for low-rate initial production next year, which is the last step before full production. For a company our size, with $35 million or so in revenue, a contract like this could completely transform us. And although there is a possibility that Lockheed will not win against Raytheon, we know that this technology we developed is so transformative and important that the same customer is already integrating it into at least two additional programs. I'll now turn to our third pillar of growth, which is new commercial applications, such as automotive. As those that follow us know, Lightbar has been working with several Tier 1 and Tier 2 automotive OEMs to develop and qualify thermal imaging solutions for use in ADAS. Per a new mandate set by the National Highway Traffic Safety Administration by 2029, All new cars should include an emergency braking system that can identify pedestrians in pitch dark conditions from a certain distance. To achieve that, it appears that thermal imaging is going to be adopted into every new car, which means a significant addressable market opportunity. Ahead of those upcoming catalysts, We begin to strengthen our operational capabilities to support future growth. Subsequent to quarter end, we welcomed Steve Garcia as general manager of our Orlando manufacturing facility. Steve brings extensive operational experience in high-growth environments, and he will play a vital role in scaling our production processes to meet the increasing demand of our products, particularly for defense and industrial applications. His addition enhances our ability to support large mission critical programs while maintaining our commitment to quality and innovation. Now, I'd like to turn the call over to our CFO Al Miranda to talk about our first quarter fiscal financial results. Al, please go ahead.