AMPG - NASDAQ

Good day, ladies and gentlemen, and welcome to AmpliTech Group's quarterly investor update call, where the company will discuss its second (sic) [third] quarter 2025 financial results. [Operator Instructions]. As a reminder, today's conference is being recorded. I would now like to turn the call over to AmpliTech's COO, Jorge Flores.

Thank you for joining today's call to review the progress of AmpliTech's growth initiatives and financial results and to answer investor questions. On the call today are AmpliTech's founder and CEO, CTO, Mr. Fawad Maqbool; the company's CFO, Louisa Sanfratello; and the company's COO, Jorge Flores. Following initial management comments, we will open the call to investor questions. An archived replay of today's call will be posted to the Investors Relations section of AmpliTechs' corporate website. This call is taking place on Friday, November 14, 2025. Remarks that follow and answers to questions may include statements that the company believes to be forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to various risks that could cause actual results to be materially different than expected. Such risks include, among others, matters that the company has described in its press releases and its filings with the Securities and Exchange Commission. Except as described in these filings, the company disclaims any obligation to update forward-looking statements, which are made as of today's date. With that, let me turn the call over to our CEO and CTO, Mr. Fawad Maqbool.

Ladies and gentlemen, good morning, and thank you for joining our Q3 2025 review call. Today, we will reflect on our record performance in 2025 and the nine-month period ending September 30, 2025. We will take the opportunity to discuss the company's growth outlook, market opportunities, and provide additional financial guidance. Let's start with the Q3 2025 highlights and strategic progress. Quarterly revenue was $6,090,000, a 115% increase compared to $2,830,000 in Q3 2024. Gross profit more than doubled to $2,960,000, representing a 48.6% gross margin, up from 47.5% in the prior year period. Up about 40% from Q2 2025 gross margin. EBITDA positive of nearly $200,000, reflecting substantial improvement in operating performance and margin expansion. Net loss significantly narrowed to $188,000 compared to a net loss of $1,190,000 in Q3 2024. Cash, cash equivalents, and accounts receivable of nearly $12,000,000 with zero long-term debt working capital of $14,000,000 as of September 30, 2025. Now the nine-month highlights. Year to date, 2025. Overall, nine months company's record revenues surged 171% year to date to $20,700,000 compared to $7,700,000 in the same period last year. Net loss reduced by nearly 50% improving from $7,400,000 in 2024 to $3,800,000 in 2025. The growth driven by successful integration of Apple 5G ORAN technology and strong momentum in low noise amplifiers, low noise blocks, and 5G infrastructure systems. This is not just 5G ORAN, it's true 5G, and we are 5G. Continued investment in R&D up 60% supporting the new product development in MIMO, 64 P64 ORAN radios, private 5G network systems, and cryogenic amplifier platforms for quantum applications. Now this isn't just random R&D. It's strategically focused on what the world needs. Billion and trillion dollar market. Operational and financial highlights. Integration of ORAN IP portfolio positions AmpliTech Group, Inc. as a US-based vertically integrated supplier for next-generation open RAN 5G radios and private network deployment. Our third quarter shows to be an EBITDA positive quarter. Achieved through disciplined expense control, operational efficiency, and growth in high margin segments. This is a clear signal we are turning the corner and getting close to achieving profitability. Price offering announced earlier. It's an above-market price, shareholder-friendly rights offering priced at $4 per unit, providing growth capital for scaling ORAN product lines and expanding domestic production. We are going to go deeper into that a little bit later. But now I give some outlook and forward guidance. The company increased revenue guidance to at least $25,000,000 fiscal year 2025, representing a 160% year-over-year increase over fiscal year 2024, beating the street estimates. We anticipate double-digit gross margins in Q4 2025 and 2026. As production costs normalize, one-time costs are reduced and higher margin follow-on business ramps up. We project positive cash flow from operations and profitability to be achieved in fiscal year 2026. Assuming simulation of current order pace and margin recovery. Company expects to receive follow-on orders from both public announced LOIs, imminently. As well as orders from new customers in 2026. Assuming continuation of the current order pace and based on forecast information received by the company, fiscal year 2026 revenue will be at least $50,000,000, effectively doubling that of projected record fiscal year 2025 of at least $25,000,000. What you have all said, I would like to focus on our current right offering effort. Because I am sure many people are confused. AmpliTech Group, Inc. has an effective form S-3 based perspective. Perspective from which it intends to offer these securities registered with the Securities Exchange Commission. For a proposed rights offering in which the class distribute to a, stockholders and b, certain warrant holders to transferable unit rights. To purchase up to the maximum of 8,000,000 units. At $4 per unit. Each unit will consist of one share of common stock. The common shares, and two short-term rights to purchase additional common shares. These are rights short-term rights, not warrants. Under the rights offering, each stockholder and certain warrant holders as of the record date will receive as a dividend at no charge two unit rights for each common share each common share subject to a warrant owned on the record date. The distribution of the unit rights will occur on or around the record date. The record date for the distribution of the unit rights the expiration date for the unit rights, and related short-term rights, and related pricing information will be included in the final perspective. Holders who fully exercise their unit rights will be entitled to oversubscribe for additional units. If available. That that are not purchased by other right holders subject to potential pro-rata allocation of those oversubscription units. For which they subscribe in proportion to the total number of oversubscription units. Now that sounds very complicated. But you can get the FWP that has been published publicly to get all the details. The company is aiming for 25 to 30% annual growth through 2030. This target is mainly driven and based on our ORAN 5G LOIs with two different customers. These LOIs, while not binding, are the result of months technical meetings that are involved in as what is known as the industry in the industry as POCs or proof of concept. But this says there's a predetermined price set up with these minimum quantities and specific delivery requirements set in place already, which have been supported by receiving forecast from both customers. We are executing on a visible pipeline. Early repeat orders and capacity plans to support tens of thousands of radios over time. As we scale, we expect operating leverage better first purchasing, higher manufacturing cycle, which will contribute to lift gross margins. Put simply 25, 35, 30% isn't a moonshot, it's what happens when a validated product line meets the secular upgrade. Cycle with a differentiated ORAN 5G supplier. Company's rights offering provides our loyal investors choice fairness, and alignment. In choice, a right offering lets every shareholder decide if they want to maintain or increase their ownership on similar terms. No one's backed out by a collective private deal. Everyone has access. Fairness, it's pro-rata. By design. If you participate, you can offset those. And if you do not, you are making conscious portfolio decisions. Not suffering because we raised capital with a small group. Please take note, the rights are transferable. Owners can also choose to sell their rights in the market as we do expect market makers will create a market for them to be traded. So again, not just fairness for flexibility. Alignment. Picked this structure to strengthen the balance sheet without loading the company with expensive debt or entering into toxic financing transaction. It supports growth while respecting our valued long-term shareholders. It also sends a clear signal. We are raising capital to fund concrete opportunities. Production, inventory turns, certifications, and go to market. Are not raising capital to plug gold. Bottom line, the right deal gives us, our shareholders, agency and keeps us aligned as we step into larger orders and programs. We are inviting our owners to come with us on the next leg of our growth on the same terms. The company will use the proceeds as a high return near-term growth lever. There are five levers. Number one, scale production and working capital. Fund inventory for committed and forecasted orders. Shortened lead time, and secure long lead components. The goal is faster, order the cash, and the capacity to fulfill multisite rollouts without potterling. Number two, certification and market access. Complete and extend complete these certifications and will extend certification like CE and ISED Some are operator specific. The field trials and interoperability testing. Each certification stamp expands our addressable market and removes friction for large fire. Number three, product road map, encryption and software. Advance next-gen videos and RF front ends, add AI rig adjacent features improve manageability, and harden security. We also have a proprietary encryption. For our networks. It's hardware-based, not firmware-based. Big difference. Which we want to incorporate across our entire ORAN 5G product line. These additional products and features will lift performance and margin and create upsell paths across our installed base. These are valuable differentiators for us. We are not a need to company. We have never been. Go to market number four, go to market expansion. The strategy is to add sales, engineering, carrier enterprise channel partners, and targeted international presence were trusted highly secured for end 5G has become a mandate. We all know how important security is. We are going to the next step. Incorporating this into our networks. This accelerates deal velocity and conversion. And finally, number five, strategic flexibility. It keeps the balance sheet strong so we can pursue select tuck-ins, joint ventures, or capacity investments when they are clearly accretive. We are disciplined about ROI. Dollars go where they unlock revenue, improve gross margin, and reduce cycle time. That's how this raise translates into 25 to 30% growth trajectory. More importantly, durable value creation.

In concluding, valued shareholders, we are firmly looking ahead with our company having a record fiscal year 2025. In which we expect to nearly triple the sales achieved in fiscal year 2024. The major milestone for the company. We have expectations of receiving additional orders to continue funding our LOIs with a healthy balance sheet zero long-term debt, an expanding portfolio of proprietary 5G and satellite technology. We also have special cryogenic amplifiers to serve the growing needs of the quantum computing market. Along with ORAN technology to support artificial intelligence, and global 5G product certifications now in place. AmpliTech Group, Inc. is now positioned to deliver successive quarters of growth enhance shareholder value, a significantly stronger IP valuation in 2046 and beyond. Thank you for continued support. We will now open the call for questions. Operator, please proceed.

Okay. Thank you. We will now move on to Q&A. If you would like to ask a question at this time, you may press and the confirmation tone will indicate your line is in the question queue. May press 2 if you like to withdraw your question from the queue. For participants that are using speaker equipment, it may be necessary to pick up the handset before pressing the star keys. Again, that's 1 to ask a question. We will pause a moment to assemble the queue. Thank you. Thank you. Our first question comes from the line of Vishal Mishra with Bardis Associates. Please proceed with your question. Hi. Good morning, Fawad.

Good morning. So just wanna I heard you right, which is that you do expect these rights to be traded when they are distributed? Correct?

Correct.

That's great. Thanks. And, second question, this is great momentum. Congratulations. Do we I know I see double-digit gross margins, or do we have any more like, as you scale, like and you also said that the gross like, the margins, the quantities have been sort of solidified in the contract as as you have been working on the on the POC. Do we know more can do we have more color on that? Is it, like, those those margins which has been in the been agreed upon are, like, in in '20, like, the gross margin, the con like, in the twenties, thirties, forties, or is that's not something you can disclose?

Hello. This is Jorge Flores, our COO for AmpliTech Group, Inc. Gonna be taking on on on that on that answer. We do have a mixed we have a mixed list of ORAN 5G products. So and and every single one of them carries a different gross margin. All we can say right now, though, and also due to competitive natures right, that we are not going to be able to disclose the specific gross margin information on our products. Due to competitive nature, of course. But that's why we are saying that that at least we are going to be able to achieve double-digit gross margins on on every of our products right now.

Great. Thank you, Jorge. So, I know historically you have been close to you know, thirty, forty. Is there something historically you'll be or, like, because these are new products that'll be lower, higher, or difficult to say. Timber is that. Well, as as as you could see, though, from our results in Q2 in which we have lot of onetime cost cost drivers. So We have recovered very handsomely in in Q3. With over 40% gross margins. So we are, of course, so, you know, like, going to keep allocating capital, right, to to improve on our margins, you know, like, at some some so, you know, okay, we might elect to to go into a higher configuration of of molding equipment and fixturing to be able to drive the cost down on every single item used in our in our radius.

So, we we do expect, though, that that we are going to have as as I said before, though, at least, you know, like, a gross margins in double digits.

Okay. Thank you, Jorge. That's it for me.

You're welcome.

Thank you. As a reminder, if you would like to ask a question, you may press star 1 from your telephone keypad. Thank you. This concludes the Q&A session. I will turn the call back to Fawad Maqbool for closing remarks. Thank you. For a moment, please you may proceed with closing remarks. Okay.

Operator. Thank you. Operator, thank you everyone who enjoyed today's call to hear about progress we made. Plan. We have to further our company's mission of providing the communication systems of tomorrow, today. We look forward to updating you further on our full year financial results call next year. Until then, please contact us directly should you have any questions or wish to schedule a call with management. Our investor relations team can be reached at the contact information listed at the bottom of our press release. Thank you and be well.