Virtuix Holdings Inc.

Good morning and welcome to the Virtuix Earnings Conference call for the full fiscal year 2026 and in March 31, 2026. All lines have been placed on a listen-only mode and the floor will be open for your questions following the presentation. During today's call, we may make statements relating to our goals and objectives for future operations, financial and business trends, business prospects, and management's expectations for future performance that constitute forward-looking statements under federal securities laws. Any such forward-looking statements reflect management's expectations based upon currently available information and are not guarantees of future performance, and they involve certain risks and uncertainties that are more fully described in our SEC filings. Our actual results, performance, or achievements may differ materially from those expressed in or implied by such forward-looking statements. We undertake no obligation to update or revise any forward-looking statements to reflect events or developments after the date of this call. A press release detailing these results was issued this morning and is available on the company's investor relations website at invest.virtuix.com. Hosting today's call are Virtuix founder, Chief Executive Officer and Chairman Jan Goodluck, and Chief Financial Officer Thomas McGinnis. They will provide a corporate overview, review key highlights, discuss strategic milestones, cover financial results, and outline the company's priorities and outlook. With that, I'd like to turn the call over to Mr. Goodluck.

Thank you, operator, and good morning, everyone. Thank you for joining us to review our results for the fiscal year 2026. Today, we'll walk you through a brief corporate overview. Our key highlights for the year are strategic milestones across consumer, defense, enterprise, and healthcare. And then Thomas will take you through a detailed financial review. So let's get started. We are a leading developer of AI-driven full-body virtual reality systems now trading on the NASDAQ global market under the ticker VTIX since their debut on January 27th, 2026. And we were honored to ring the NASDAQ opening bell on March 6th, which was a nice experience. Our technology enables natural full-body movement in 360 degrees inside virtual worlds. So bringing the physical act of walking and running into video games and other applications across enterprise and defense. Our product portfolio includes five core offerings covered by 25 issued patents with the 26 patents recently allowed. We have OmniOne, OmniOne for Quest, and OmniOne Core. Those are our flagship consumer products. OmniOne Enterprise for industrial training and other enterprise applications. and Road to Terrain Work, or VTW, which is our primary defense simulation system. We are hardware experts with a proven track record of execution. We're headquartered in Austin, Texas, with operations in Zhuhai, China, where our manufacturing facility is set up and ready to support up to 3,000 units per month, which would represent over $100 million in annual revenue potential at full utilization. So we are ready to scale. We pursue a multi-use revenue strategy that includes high-volume consumer gaming and fitness, supplemented by high-value defense and enterprise training, all with recurring revenues from software, games and subscriptions for consumers, and software licensing and custom simulation development for defense and enterprise customers. We're also at the leading edge of AI-driven 3D reconstruction with technologies like Gaussian Splatting that transform 360-degree video footage into photorealistic, walkable 3D worlds in just hours. Previously, recreating a real-world environment as an explorable space in virtual reality, well, that could take weeks or several months. Very expensive, very time-consuming. Today, Thanks to AI, we can do that in just a few hours. And we're applying this technology to our VTW defense system, and it's also driving adoption of our technology in the enterprise space for training. Fiscal 2026 was a transformational year for Virtrix on every front, financial, strategic, and commercial. Let me briefly walk you through the highlights before we take a deeper dive. Financially, we grew full-year revenue 18% year-over-year to $4.3 million, driven by strong demand for OmniOne, including a robust 2025 holiday season. Now, keep in mind that revenues in fiscal year 2025 primarily stem from fulfilling a large backlog of nearly two years of pre-orders for OmniOne, whereas fiscal year 2026, this most recent year, primarily reflects only new sales So even then, we grew revenues by double digits. And if we compare new sales in December 2026, the key holiday month, versus new sales of units in December 2025, well, new sales in December 2026 were up 60% compared to the prior years, reflecting a strong growth in our consumer segments. Gross margin turned sharply positive, coming in at 25% compared to a negative 6% in the prior year. We reduced our operating expenses by 19%, and we ended the year with $9.5 million in cash, up from just half a million a year ago. Strategically, we achieved a series of major milestones. We listed on NASDAQ under the ticker VTIX in January. validating our decade-long innovation in full-body XR, while also providing access to capital and the market visibility for us to scale aggressively. We also launched OmniOne for Quest through our collaboration with Meta and Meta's Made for Meta program. We expanded globally across the European Union, the United Kingdom and Canada. And most importantly, we're also seeing strong traction in our defense business with U.S. Air Force Cibra Awards, our selection as a lead integrator for U.S. Marine Corps training system, and a development agreement with U.S. Navy. And last, we also extended our platform into longer-term verticals like healthcare. So let me turn to these strategic milestones in more detail. So one of the most significant developments of the year is the launch of OmniOne for Quest in collaboration with Meta that happened just this past Tuesday. Through Meta's, Metro Meta program, OmniOne is now certified for the MetaQuest ecosystem and will be featured in the Meta store. You know, more than 20 million Quest headsets have been sold with an estimated six million or so active users by recent estimates. So for the first time, those users can pair OmniOne with their existing Quest headset and game library, enabling them to walk, run, crouch, strafe, jump, all in 360 degrees through a plug-and-play experience. So this meaningfully expands OmniOne's addressable market and broadens our distribution. And OmniOne, which some call the peloton for gamers, also earned meaningful consumer validation in the past year. And as you know, users can burn up to 700 calories per hour. So in addition to being fun, it's also good for your health. Well, our product now holds a 4.8 star average rating. And OmniOne also won a 2025 Augie Award, which is one of our industry's most prestigious awards. At $2,595, about $90 per month with a firm, OmniOne for Quest is also our most successful entry point into full-body VR. We view this as an important step forward for bringing physically active, engaging, full-body virtual reality to a much larger consumer audience. Our international growth is also well underway. OmniOne for Quest and OmniOne Quest Core are now available across Germany, the UK, France, and additional EU markets through dedicated storefronts. And most recently, we've also expanded its availability into Canada through our online store. So this adds a large, high-income, international consumer base for our products. Now, we're also advancing into the medical vertical through university-led validations of our platform. We deployed OmniOne at Rutgers University at WinLab, for research and development in AI-assisted neurodivergent therapy, as well as immersive behavior analytics, including autism therapy for children. And similarly, at the Florida Gulf Coast University, faculty there in the Marriott College of Health and Human Services are evaluating OmniOne for physical and occupational therapy, neurorehabilitation, fall prevention, and clinical simulations. We believe that in the future, These collaborations can open up new large revenue opportunities within next generation healthcare and specifically therapeutic applications. So that's potentially a third big vertical for our product in addition to consumer and defense. So let's turn to defense. A major component of our long-term growth strategy is the defense markets where we now have active programs across all four branches of the U.S. military. Our vision there is to supplement our high-volume consumer sales with potentially high-value defense contracts. Now, we're experiencing rapid traction for our technology in the defense training and simulation markets. With the U.S. Air Force, we recently received an AFWERX Cyber Phase I award for VTW, and we've also sold test units to the U.S. Air Force Academy and Yokota Air Force Base. For the U.S. Marine Corps, specifically their Training and Education Command, or TCOM, through their partnership with KBR, we were selected as elite integrator for a multi-user virtual infantry training system featuring four Omni-1 treadmills. With U.S. Army, we sold Omni-1 to the U.S. Military Academy at West Point. With U.S. Navy, we signed a cooperative research and development agreement with the Naval Postgraduate School to evaluate OmniOne for training and simulation. Now, to further accelerate our position in this market, we also formed a special board committee to evaluate strategic acquisitions in defense training and simulation. So we are actively evaluating companies today that provide immediate access to government contract vehicles, and recurring defense revenues in the $10 to $50 million range. So in addition to boosting revenues, we believe such an acquisition can provide several other key benefits, and that includes positioning Virtuix to expand into larger multi-year contracts, acquiring valuable past performance credentials. Now, past performance is critical for winning large government contracts, and we can acquire that. And we also gain access potentially to establish sales channels and contract vehicles across all branches of U.S. military. Additionally, also we believe there may be meaningful synergies between our 360-degree movement technology, the Omni, and the capabilities of potential acquisition targets, which would result in opportunities for cross-selling, enhanced training solutions, and making contract bids more competitive. So we believe this initiative of pursuing M&A in a defense sector is very promising and a potentially major catalyst for our company going forward. The center of defense offering is our virtual terrain walk system with the slogan, Walk the Terrain Before You Fight on It. And most recently, we demonstrated VTW's Alongside our FARB trainer, the Forward Armament Refueling Trainer, at TESIS, which is a training and simulation industry symposium, TESIS 2026, we also showed it at the VRARA's fourth annual Immersive Technology Summit. Now, VTW is powered by that AI-driven causus planning technology that I mentioned, which transforms 360-degree footage into photorealistic walkable 3D terrain in just hours. That enables terrain generation in just a few hours, thanks to the use of AI. So that enables immersive mission planning, where users can walk geospecific terrain in 360 degrees for reconnaissance, decision support, and leader rehearsals. And this system supports 12 or more distributed stations, enabling multi-user planning across geographically separated sites. So essentially, For the first time here, warfighters can explore the battlefields before we put boots on the ground. And we believe that is a revolutionary capability that our defense and our military did not have until now, thanks to our technology. Now, importantly, beyond the upfront system sale, VTW is designed to generate high-margin recurring revenue from software licensing and customized simulation developments. All right, with that, I'll hand the call over to Thomas to walk us through the financials.

Thank you, Jan, and good morning, everyone. Net sales for the full fiscal year, 2026, were 4.3 million, an 18% increase from 3.6 million in the prior year. The increase was driven primarily by new sales of OmniOne, including a strong 2025 holiday season. Whereas prior year sales primarily reflected the fulfillment of legacy OmniOne pre-orders placed during our pre-order period that ended in September 2024. Sales of new OmniOne and OmniOne core systems were up 60% in December fiscal year 2026 compared to the prior year, reflecting strong growth in our consumer segment. The metric I'd like to emphasize most is gross margin. Gross profit improved by 1.3 million to 1 million to $1 million compared to a gross loss of approximately $0.2 million in the prior year. Gross margin turned positive, reaching 25% compared to negative 6% a year ago. That represents a 31 percentage point improvement and is a meaningful step forward for the business. This improvement was driven by the higher average selling price of the complete OmniOne system Lower per unit manufacturing overhead and the completion of delivery of nearly all discounted units to our equity crowdfunding investors. Turning to full year operating expenses, total operating expenses decreased in fiscal year 2026 by 2.6 million or 19% to 11.4 million from 14 million in the prior year, reflecting meaningful cost discipline across the organization. General and administrative expenses declined by $2.2 million, and research and development expenses declined by $1.3 million, partially offset by a $0.9 million increase in selling expenses as we invested in commercial expansion. As a result, loss from operations improved by approximately 27% to $10.3 million compared to $14.2 million in the prior year. Net loss for the year was $16.8 million compared to $14.6 million in the prior year. However, it is important to note that this increase was not driven by operating performance, which again improved materially year over year. Rather, the change was driven by approximately $6.4 million of non-operating costs, the majority of which were non-cash, including interest expense, amortization of debt discount on our convertible notes, and a one-time non-cash warrant modification expense, all related to capital rates during the year. These items sit below the operating line. Turning to our balance sheet and liquidity position, we ended the year in a substantially stronger position. Cash and cash equivalents totaled 9.5 million as of March 31st, 2026, compared to 0.5 million a year earlier, an increase of approximately 9 million Total assets also increased to 14.8 million compared to 5.8 million in the prior year. And on the liability side, total liabilities were 11.7 million compared to 6.6 million a year ago. Included in the fiscal year 2026 liabilities are 8.5 million of notes payable net of debt discount. 6.1 million of these notes are convertible and structured to convert into equity rather than require cash repayment. The remainder, 2.4 million notes, are straight promissory notes with a maturity date of July 1st, 2027, and they are intended to be repaid via 3A9 exchanges into equity prior to their maturity date. So, in other words, none of our year-end notes payable are intended to require a cash repayment. Importantly, stockholders' equity turned positive, reaching 3 million compared to a stockholder's deficit of 0.8 million a year ago, representing a 3.8 million improvement. During the year, we strengthened the balance sheet through warrant exercises, convertible note issuances, and other financing activities. And with that, I'll turn the call back over to Jan.