Pixelworks, Inc.

Good day, ladies and gentlemen, and welcome to Pixelwork Inc's fourth quarter 2025 earnings conference call. I will be your operator for today's call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. As a reminder, this conference call is being recorded for replay purposes. I would now like to turn the call over to Brett Perry with Shelton Group Investor Relations. Please go ahead.

Thank you, DeeDee. Good afternoon, and thank you for joining us on today's call. With me on the call are Pixelworks Chairman and CEO Todd DeBonis and Chief Financial Officer Haley Amon. The purpose of today's conference call is to supplement the information provided in Pixelworks' press release issued earlier today announcing the company's financial results for fiscal year 2025. Before we begin, I'd like to remind you that various remarks we make on this call, including those about projected future financial results, economic and market trends, and our competitive position constitute forward-looking statements. These forward-looking statements and all other statements made on this call that are not historical facts are subject to a number of risks and uncertainties that may cause actual results to differ materially. All forward-looking statements are based on the company's beliefs as of today, Thursday, March 12, 2026. The company undertakes no obligation to update any such statements to reflect events or circumstances occurring after today. Please refer to today's press release, the company's annual report on Form 10-K for the year ended December 31, 2025, and subsequent SEC filings for a description of factors that could cause forward-looking statements that differ materially from actual results. Please note, throughout the company's press release and management statements during this conference call, we refer to net loss attributable to Pixelworks Inc. as simply net loss. With that, it's now my pleasure to turn the call over to Pixelworks. Chairman and CEO, Todd, please go ahead.

Thank you, Brett. Good afternoon and welcome to everyone joining us on today's conference call. As a foundation for discussing our go-forward business and strategy, I want to begin today's call with a review of our recently completed sale of the company's Shanghai-based subsidiary. Following a roughly year-long process, in October we signed a definitive purchase agreement to sell all of Pixelworks Inc's ownership of its Shanghai semiconductor subsidiary to a special purpose entity controlled by Verisilicon. Then on January 6th of this year, we announced the successful closing of the transaction, which resulted in net cash proceeds to Pixelworks of approximately $51 million. The cash proceeds from the sale were received in early January And with the approximate $11 million we had on hand at the end of 2025, our cash balance starting this year was approximately $62 million. In addition, there is still approximately $1.2 million in escrow for a tax dispute that looks to be resolved in our favor. As outlined in my letter to shareholders last November, the rationale for the transaction was threefold. First, it unlocked significant value for our shareholders by monetizing a key asset that was exposed to increasingly complex business and geopolitical environments. In addition to repatriating the cash proceeds to the US, the transaction also completely eliminated all prior obligations of Pixelworks Inc. to minority investors in the Shanghai subsidiary. Second, with the exit of the semiconductor hardware business, we were able to reposition Pixelworks as a global technology licensing business focused on cinematic visualization solutions, which I'll talk more about in a minute. Lastly, the transaction meaningfully strengthened our balance sheet, increasing both the company's financial stability and flexibility. Without the financial and capital burdens associated with operating a resource intensive semiconductor business in China, Pixelworks can focus on expanding our core strengths in visualization enhancement solutions, pursuing new and existing licensing initiatives and allocating capital to the highest ROI market opportunities. Since the transaction closed in January, we have taken additional steps to transform the remaining organization. These included reducing headcount that primarily were supporting the Shanghai subsidiary, as well as adding a few key hires, most notably the appointment of our new EVP of Business Development, Seven Brown. We also made changes to Pixelworks Board of Directors to better align with and support our go-forward strategy. Having provided that background, I want to frame what our business looks like today, post-transaction. We have effectively transformed Pixelworks into a lean, asset-light, global technology licensing company. We continue to have 100% ownership of a significant intellectual property portfolio, underpinned by over 60 issued and pending patents related to our TrueCut Motion grading platform, as well as broader visual enhancement technologies. As of today, the company is comprised of less than 25 full-time employees, with roughly 60% being dedicated to R&D. To the extent we choose to grow the size of our team, it will be based upon demand for our technology as opposed to arbitrary growth targets. Today and going forward, as a pure play technology licensing company, We are focused on providing a combination of new and existing cinematic visualization solutions that enable truly differentiated viewing experiences. Our current portfolio of solutions is anchored by Pixelworks True Cut Motion Platform, which continues to be utilized by leading filmmakers to enhance the cinematic experience across premium theatrical screens. In 2025, we were credited with several notable releases featuring True Cut Motion, including DreamWorks' animations The Bad Guys 2 and Universal Pictures' Nobody 2, released to worldwide premium large format theaters. Additionally, Jurassic World Rebirth was showcased in True Cut Motion format on CineD premium screens. And then our motion grading technology was most recently used in Universal Pictures' theatrical release of Wicked for Good. As part of our refined strategy to accelerate expanded adoption of our True Cut Motion platform, we are putting increased emphasis on supporting premium, visually stunning films that are released theatrically. Together with today's growing premium large format theatrical experiences, these tentpole titles generate an outsized share of the total theater box office sales. Further validating this fact is the rapidly growing number of premium large format, or PLF, screens with the industry's largest exhibitors allocating a majority of their new capex spending to expand their premium theatrical experiences. As such, we are pursuing further direct engagement with the leading premium exhibitors who are naturally aligned with our objective of engaging studios and filmmakers to deliver more premium format content. The initial results of these direct engagement efforts have been very positive. In January, we announced a partnership with Marcus Theaters to prioritize True Cut Motion across their premium screens. For context, Marcus is the fourth largest theater chain in the United States with nearly 1,000 screens across 78 cinema complexes operated under multiple different brands. Most recently, we secured a similar endorsement from Odeon Cinemas Group, the largest cinema operator in Europe and also affiliate of AMC, to bring additional titles to True Cut Motion format to their premium auditoriums. We are currently in discussions with and expect to announce partnerships with additional leading premium exhibitors in the near future. Collectively, we anticipate these collaborations with exhibitors will result in increased demand for our true cut motion format. Our near-term objective is to be associated with many of the most visually impactful titles released to theaters in a given year, which we believe will accelerate our growth path towards increased market awareness and expanding ecosystem partnerships. With Truecut Motion's unique ability to enable the most authentic high fidelity viewing experience and a growing number of premium screens, we continue to believe there is a large and compelling market opportunity for our motion grading technology and expertise. The primary focus of our advanced algorithm team is to further expand the capabilities of our motion grading tools, both for productivity and better picture quality. Today, we are working on on our most complex projects to date, which is providing us with real-time feedback from our motion grading supervisors. In addition to this activity, we identified adjacent opportunities for our motion processing technology. We, like others, are leaning into the benefits that AI technology can bring to our development process. In summary, the successful exit from our previous semiconductor business has enabled us to transform the company into a more nimble, scalable, and asset organization that's well capitalized. Our immediate strategic focus is enabling additional premium large format theatrical experiences and currently have a growing demand for our true cut motion grading services. I also want to emphasize that maintaining a robust balance sheet remains a high priority. We are committed to prudently managing resources and efficiently using our cash on operations as we work to build a broader and highly profitable licensing business centered around cinematic and visual enhancement solutions. With that, I'll turn the call over to Haley to provide some additional information and details, as well as our current balance sheet position.