Q4 2024 Blaize Holdings Inc Earnings Call
Okay.
Operator: Good day and thank you for standing by.
Speaker Change: Good day and thank you for standing by welcome to the blades fiscal year 2024 earnings Conference call. At this time all participants are in a listen only mode. Please be advised that today's conference is being recorded after the speaker's presentation there'll be a question and answer session to ask a question. Please press.
Operator: Welcome to the Blaze Fiscal Year 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. Please be advised that today's conference is being recorded.
Operator: After the speaker's presentation, there will be a question and answer session.
Operator: To ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again.
Speaker Change: Star one on your telephone and wait for your name to be announced to withdraw. Your question. Please press star one again I would not like to hand, the conference over to your speaker today.
Lana Adair: I would now like to hand the conference over to your speaker today, Lana Adair, Investor Relations. Thank you and good afternoon. I am Lana Adair, Investor Relations for Blaze.
Speaker Change: Dear Investor Relations.
Speaker Change: Thank you and good afternoon I am on a dairy that's relationship played before we begin the prepared remarks, we'd like to remind you that earlier today <unk> issued a press release announcing its full year 2024 result.
Lana Adair: Before we begin the prepared remarks, we would like to remind you that earlier today, Blaze issued a press release announcing its full year 2024 results. An investor presentation was published and is available on the Investor Relations section of Blaze's website.
Speaker Change: An investor presentation was published and is available on the Investor Relations section of places website.
Lana Adair: Today's earnings call and press release reflect management's views as of today only, and will include statements related to our competitive position, anticipated industry trends, business and strategic priorities, our financial outlook for the first quarter of 2025, and full year fiscal year 2025, all which constitute forward-looking statements under the federal securities law. Actual results may differ materially from those contained in or implied by these forward-looking statements due to risks and uncertainties associated with the business.
Speaker Change: Today's earning call and press release reflect management's views as of today only and will include statements related to our competitive position anticipated industry churn busy.
Speaker Change: And strategic priorities, our financial outlook for the first quarter of 2025 and full year fiscal year 2025, all which constitute forward looking statements under the federal Securities laws.
Actual results may differ materially from those contained in or implied by these forward looking statements due to risks and uncertainties associated with the business.
Lana Adair: For a discussion of the material risks and other important factors that could impact actual results, please refer to the company's SEC filings and today's press release, both of which are found on the Investor Relations website. Any forward-looking statements that we make on this call are based on assumptions as of today and other than those that may be required by law, we undertake no obligation to up these statements as a result of new information or future events.
Speaker Change: For a discussion of the material risks and other important factors that could impact actual results. Please refer to the Companys SEC filings and today's press release, both of which are found on the Investor Relations website.
Speaker Change: Any forward looking statements that we make on this call are based on assumptions as of today and other than those that may be required by law. We undertake no obligation to up these statements as a result of new information or future events.
Lana Adair: Information discussed on this call concerning BLAZE's industry, competitive position, and the markets in which it operates is based on information from independent industry and research organizations, other third-party sources, and managements at For more information visit www.blaze.com These estimates are derived from publicly available information released by independent industry analysts and other third-party sources, as well as data from BLAZE's internal research. These estimates are based on reasonable assumptions and computations made upon reviewing such data and Blaze's experience in and knowledge of such industry and markets. By definition, assumptions are subject to uncertainty and risk, which would cause results to differ materially from those expressed in estimates.
Speaker Change: Information discussed on this call concerning Blazers industry competitive position and the markets in which it operates is based on information from independent industry and research organizations.
Speaker Change: Their third party sources and management's estimates.
Speaker Change: These estimates are derived from publicly available information released by independent industry analysts and other third party sources as well as data from places internal research.
Speaker Change: Estimates are based on reasonable assumptions and computation made upon reviewing such data and Blazers experience and knowledge of such industry end markets.
Speaker Change: By definition assumptions are subject to uncertainties and risks, which could cause results to differ materially from those expressed in estimates. During this call. We will discuss certain non-GAAP financial measures. These non-GAAP financial measures should be considered as a supplement to and not as a substitute for measures prepared in accordance.
Lana Adair: During this call, we will discuss certain non-GAAP financial measures. These non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, measures prepared in accordance with GAAP.
Lana Adair: For a reconciliation of non-GAAP financial measures discussed during this call to the most directly comparable GAAP measures, please refer to today's press release.
Speaker Change: With gap for a reconciliation of non-GAAP financial measures discussed during this call to the most directly comparable GAAP measures. Please refer to today's press release.
Lane Best: Now I'd like to turn the call over to Blaize's Chairman of the Board, Lane Best, to say a few opening remarks. Hi, my name is Lane Bass and I'm the chair. I've always enjoyed being involved.
Speaker Change: Now I'd like to turn the call over to Blaise as chairman of the Board Lane Beth to say a few opening remarks.
Speaker Change: Hi, My name is laying bass and I'm the chairman of Blaise.
Speaker Change: I've always enjoyed being involved with exciting technology forward companies and I've been fortunate enough to have some great success working with several high growth technology companies that successfully built enormous moats and critical technology areas.
Lane Best: © The Ultimate Parody Site-Limited Company, LLC. And I've been fortunate enough to have some great success working with several high-growth technology. that successfully built enormous moats in critical technology areas. I feel Blaze has all the necessary pieces to build a valuable and sustainable company in the enormous and rapidly growing AI edge space. The AI that I saw when I first met Dynacar and the founding team was something that I believed was going to be equally as disruptive as other companies I've been involved with. Particularly what intrigued me about Blaze was not only the advancement they had made in terms of the chip and silicon archery, but also the software they developed that runs on top of it.
Speaker Change: I feel blazers, all the necessary pieces to build a valuable and sustainable company and the enormous and rapidly growing space.
Speaker Change: The AI that I saw when I first met in a car and the founding team with something that I believe was going to be equally as disruptive as other companies I've been involved with.
Speaker Change: Particularly what intrigues me about Blaze was not only the advancements made in terms of the shift in silicon architecture, but also the software they develop that runs on top of the chip to me. This was taking AI to the edge in a compelling way.
Lane Best: To me, this was taking AI to the edge in a compelling way. If you explore what we've seen, particularly in the data centers, These are very heavy LLM processing data center solutions and NVIDIA will probably dominate for a long Others, like Cerberus, will probably take pieces of the mark. But the area of edge AI computing, this is where we believe we're going to see a lot of innovation. The team at Blaze understands that the market for AI at the edge is expected to be every bit as large, if not larger than what we see in the data center.
Speaker Change: If you explore what we've seen particularly in the data center industry. These are very heavy LLM processing data Center solutions, and then video will probably dominate for a long time in the space others like Cerberus will probably take pieces of the market.
Speaker Change: But the area of edge AI computing. This is where we believe we're going to see a lot of innovation.
Speaker Change: The team at Blaze understands that the market for AI at the edge is expected to be every bit as large if not larger than what we see in the data center industry.
Lane Best: And the solutions are going to take a unique design, which we believe Blaze can deliver. We believe there are going to be many use cases for Blaze's technology offerings as we go forward, including, but not. Smart City and Defense System. As was in the case with NVIDIA, their growth began with gaming and later surged with open AI and generative expanding their market share in a We believe there is a similar and perhaps even more rapid demand trajectories here due to AI demand and semiconductor. Being in the public markets allows us to capitalize on this momentum and unlock the full potential of our expansion.
Speaker Change: And the solutions are going to take a unique design, which we believe plays can deliver we.
Speaker Change: We believe theyre going to be many use cases for Blazers technology offerings as we go forward, including but not limited to smart city in defense systems.
Speaker Change: As was in the case with Nvidia their growth began with gaming and later surged with open AI and generative AI expanding their market share and adoption.
Speaker Change: We believe there is a similar and perhaps even more rapid demand trajectory here due to AI demands in semiconductors.
Speaker Change: Being in the public markets allows us to capitalize on this momentum and unlock the full potential of our expansion opportunities and now I will turn it over to Dana card, who will get deeper into the technology and Blazers opportunity as a public company.
Lane Best: And now I'll turn it over to Dinakar, who will get deeper into the technology and blaze his opportunity.
Dinakar Munugala: Good afternoon, everyone, and thank you for joining us for Blaze's fiscal year 2024 earnings call. I'm Dinakar Munugala, CEO of Blaze. After my remarks, our CFO, Harminder Simi, will walk you through our fiscal year 2024 financial results and provide guidance for 2025.
Dana Card: Good afternoon, everyone and thank you for joining us for Blazers fiscal year 2024 earnings call.
Speaker Change: And then a good amount of that last CEO of place.
Herman: After my remarks, our CFO Herman the semi will walk you through our fiscal year 'twenty pretty forward financial results and provide guidance for 2025.
Dinakar Munugala: Then we will open it up for questions.
Speaker Change: Then we will open it up for questions.
Dinakar Munugala: Before we get into the numbers, I want to highlight several important developments from our fourth quarter and leading up to the closing of our business combination on January 13th. During this period, we finalized the necessary filings to enter the public markets, while continuing to grow our commercial pipeline, advance the software roadmap, and expand our team with key hires to support long-term execution. We saw continued growth across our pipeline with several high-priority opportunities anticipated to deliver revenue in the second half of 2025. We also secured new designments, advanced testing on core solutions, and received early customer validation across key verticals.
Speaker Change: Before we get into the numbers I want to highlight several important developments from our fourth quarter.
Speaker Change: Leading up to the closing of a business combination on January 13th.
Speaker Change: During this period, we finalized the necessary filings to enter the public markets, while continuing to grow our commercial pipeline advanced software roadmap and expand our team with key hires to support long term execution.
Speaker Change: We saw continued growth across our pipeline with several high priority opportunities anticipated to deliver revenue in the second half of 2025.
Speaker Change: We also secured new design wins advance distinct on core solutions.
Speaker Change: And received early customer validation across key verticals.
Dinakar Munugala: During 2024 and continuing into the early part of this year, we formalized partnerships with KAIST, Always AI, Visibility, and TurboFederal. These relationships represent meaningful opportunities in both commercial and public sector markets. Supporting near-term revenue visibility and laying the groundwork for scaled deployment in the future years. As we enter 2025, we have a strong pipeline coverage, aligned execution across our sales and product development teams, and increasing demand in markets such as manufacturing, public safety, healthcare, defense, and smart infrastructure. Our go-to-market strategy remains focused. Our roadmap is progressing on schedule, and engagement with customers and partners continues to deepen.
Speaker Change: During 2024 and continuing into the early part of this year, we formalized partnerships with Christ always.
Speaker Change: Visibility and turbo.
Speaker Change: These relationships represent meaningful opportunities in both commercial and public sector markets.
Speaker Change: Supporting near term revenue visibility.
Speaker Change: And laying the groundwork for scale deployment in the future yes.
Speaker Change: Yeah.
Speaker Change: As we enter 2025.
Speaker Change: We have a strong pipeline coverage aligned execution across our sales and product development teams.
Speaker Change: And increasing demand in markets, such as manufacturing public safety healthcare defense and smart infrastructure.
Speaker Change: Our go to market strategy remains focused.
Speaker Change: Our roadmap is progressing on schedule and.
Speaker Change: And engagement with customers and partners continues to deepen.
Dinakar Munugala: Blaze is entering the year with confidence, operational focus, and increasing demand across the market that is rapidly shifting towards physical AI solutions.
Speaker Change: Blazers entering the year with confidence.
Speaker Change: <unk> focus.
Speaker Change: And increasing demand across the market that is rapidly shifting towards physical AI solutions.
Dinakar Munugala: Technology moves in waves and AI is now entering its next evolution. Just as Intel and Apple helped shift computing from mainframes to personal devices, AI is now moving from the cloud to the edge. where data is created and decisions need to happen in real time. This is where Blaze excels. We deliver low-power, real-time intelligence at the edge where decisions happen, complementing cloud and GPU-based AI in environments where efficiency and responsiveness matter most. We call it physical AI. AI that works in the real world, not just the data center.
Speaker Change: Technology moves in beef and AI is now entering its next evolution.
Speaker Change: Just as Intel and Apple helped shift computing from mainframes to personal devices EA.
Speaker Change: It is now moving from the cloud to the edge, where data is created and decisions need to happen in real time.
Speaker Change: This is where it plays out.
Speaker Change: We delivered low power real time intelligence at the edge, where decisions happen complementing cloud and GPU based in environments, where efficiency and responsiveness matter most.
Speaker Change: We call it physical AI.
Speaker Change: Yes that works in the real World not just the data center we.
Dinakar Munugala: We believe Blaze is helping to define the next era of infrastructure for AI. In recent weeks, innovations like DeepSeek and Quen have reinforced that disruption remains a constant in AI. These advancements are lowering the compute requirements for deployment, enabling AI to run on smaller, more power-efficient devices. As models continue to shrink, the reach of AI is expanding into broader markets. Blazor's programmable architecture is well positioned to take advantage of this trend. While cloud AI has seen remarkable adoption, there's still a critical gap in the market. The Need for AI at the Physical Edge.
Speaker Change: We believe blazers, helping to define the next era of infrastructure for AI.
Speaker Change: In recent weeks innovations like deep seek and Quinn have reinforced that disruption remains a constant in AI.
Speaker Change: These advancements are lowering the compute requirements for deployment.
Speaker Change: Labeling AI to run on smaller more power efficient devices.
Speaker Change: As models continue to shrink.
Speaker Change: The reach of AI is expanding into broader markets.
Speaker Change: Blazers programmable architecture is well positioned to take advantage of the strength.
Speaker Change: While cloud AI has seen remarkable adoption there is still a critical gap in the market.
Speaker Change: The need for AI at the physical edge.
Dinakar Munugala: In mission-critical settings, on factory floors, inside hospitals, and across defense operations, Latency, bandwidth constraints, and reliance on the cloud are simply not acceptable. These environments. Demand real-time decision-making, onsite processing, and solutions that are both scalable and cost-effective.
Speaker Change: In mission critical settings on factory floors inside hospitals and across defense operations.
Speaker Change: Latency bandwidth constraints and reliance on the cloud are simply not acceptable.
Speaker Change: These environments.
Speaker Change: Demand real time decision, making on site processing and solutions that are both scalable and cost effective.
Dinakar Munugala: Looking ahead, we are focused on a serviceable, addressable market that we estimate will grow to $71.3 billion globally by 2028. This figure reflects increasing demand for edge-deployed AI across industries where latency, power efficiency, and real-time processing are essential. We're seeing strong demand across industries for AI that operates closer to the point of action. In manufacturing, companies need real-time defect detection and automation right on the production line, not delayed by cloud processing. In healthcare, hospitals are deploying AI-assisted diagnostics on-site to ensure both patient privacy and faster clinical decisions. In defense and security, AI must run locally, where the cloud access is often limited or entirely unavailable.
Speaker Change: Looking ahead, we are focused on our serviceable addressable market that we estimate will grow to $71 3 billion.
Speaker Change: Globally by 2028.
Speaker Change: This figure reflects increasing demand for edge deployed AI across industries, where latency power efficiency and real time processing of essential.
Speaker Change: We're seeing strong demand across industries for AI that operate closer to the point of action.
Speaker Change: In manufacturing companies need real time defect detection and automation right on the production line not delayed by cloud processing.
Speaker Change: In healthcare hospitals are deploying AI to diagnostics onsite to ensure book patient privacy and faster clinical decisions.
Speaker Change: In defense and security EIA must run locally.
Speaker Change: The cloud access is often limited are entirely unavailable.
Dinakar Munugala: Further, in retail and smart cities, physical AI can enable license plate recognition, logistics automation, and surveillance without the latency or cost of sending data to the cloud. The message from our customers is clear. They need AI where they operate. Not where the cloud providers dictate.
Speaker Change: Further in retail and smart cities physical AI can enable license plate recognition logistics automation and surveillance.
Speaker Change: Without the latency or cost of sending data to the cloud.
Speaker Change: The message from our customers it is clear.
Speaker Change: They need where they operate.
Speaker Change: Not by the cloud providers dictate.
Dinakar Munugala: We believe Blaze can enable and address this modern shift today.
Speaker Change: We believe place can enable and address this modern ship today.
Dinakar Munugala: For years, the AI infrastructure stack has been too rigid, too centralized, and too expensive. The market is asking for something different. Across multiple sectors, we hear the same message that customers and partners want more choice, more flexibility, and more tailored solutions. They want AI that fits their needs and not a one-size-fits-all approach. They need technology that integrates into their existing infrastructure without the cost and complexity of a full replacement. And they're looking for alternatives that support AI at the edge, not just in the cloud. Blaze is not here to replace GPUs or the cloud AI.
Speaker Change: For years, the AI infrastructure stack has been two digit to centralized and too expensive.
Speaker Change: The market is asking for something different.
Speaker Change: Across multiple sectors, we hear the same message that customers and partners want more choice more flexibility and more tailored solutions.
Speaker Change: They want AI that fits their needs and not a one size fits all approach.
Speaker Change: They need technology that integrates into their existing infrastructure without the cost and complexity of fulfill replacement.
And they are looking for alternatives that support AI at the edge not just in the club.
Speaker Change: Lasers, not here to replace Gpus at the cloud AI, we here to extend and complement what exists GP.
Dinakar Munugala: We're here to extend and complement what exists. GPUs are a great fit for training and data center workloads. But in physical environments where power, cost, and responsiveness matter, Blaze offers a more efficient solution. And in many deployments, Blaze and GPUs work side by side. We're collaborating with manufacturers, system integrators, ISVs, and AI developers to build a more modular, adaptable AI ecosystem.
Speaker Change: Gpus are a great fit for training and data center workloads, but in physical environments with power cost and responsiveness matter Blaze offers a more efficient solution.
Speaker Change: And in many deployments blazer Gpus work side by side.
Speaker Change: We're collaborating with manufacturers system integrators, Isps and AI developers to build a more modular adaptable AI ecosystem.
Dinakar Munugala: The market is clearly signaling the need for more options, and Blaze is well positioned to meet that demand.
Speaker Change: The market is clearly signaling the need for more options and blades is well positioned to meet that demand.
Dinakar Munugala: Our research and development is focused on three priorities. Low Latency, Power Efficiency, and Real World Deployment. Our graph streaming processor enables real-time inference at the edge with significantly lower power than traditional GPUs, without relying on constant cloud access. We believe we offer strong ROI by developing more AI per watt and per dollar while reducing energy use and cloud costs. Our end-to-end platform is built for practical deployment, not just lab benchmarks. Blaze complements existing infrastructure by bringing efficient, scalable AI to the edge.
Speaker Change: Okay.
Speaker Change: Our research and development is focused on three priorities.
Speaker Change: Low latency power efficiency and real world deployment.
Ah graph streaming processor enables real time inference at the edge with significantly lower power than traditional gpus without relying on constant cloud access.
Speaker Change: We believe be offered a strong ROI by developing more AI per watt and per dollar, while reducing energy use and cloud costs.
Speaker Change: Our end to end platform is built for practical deployment not just love benchmarks.
Speaker Change: Blaise complements existing infrastructure by bringing efficient scalable AI to the edge.
Dinakar Munugala: Blaze is a pure play AI company purpose-built for the intersection of AI, edge computing, and real-world infrastructure. As AI demand moves beyond the cloud, we're leading the shift to physical AI, where intelligence is deployed on site and where latency, power, and cost matter. Our platform delivers scalable, power-efficient performance at the edge, complementing cloud and GPU solutions by extending AI into environments where real-time local processing is essential. This is where Blaze stands apart. and where we're building long-term referentiation.
Speaker Change: Blaise as a pure play AI company purpose built for the intersection of AI edge computing and real world infrastructure.
Speaker Change: As AI demand moves beyond the cloud, we're leading the shift to physical AI.
Speaker Change: Intelligence is deployed on site.
Speaker Change: And with latency power and cost matter.
Speaker Change: Our platform delivered scalable power efficient performance at the edge complementing cloud GPU solutions by extending into environments, where real time local processing is essential.
Speaker Change: This is where blade stands apart.
Speaker Change: And where we are building long term differentiation.
Dinakar Munugala: AI is moving beyond the cloud and Blaze is prepared to help lead the transition by bringing intelligence closer to where data is generated and decisions are made. We're focused on a clear opportunity, delivering efficient, flexible AI at the edge to meet real-world customer needs. Our platform stands out by providing performance where it matters most, close to the data, in real-time, and under real-world constraints. We're executing against a roadmap, scaling with discipline, and making steady progress.
Speaker Change: AI is moving beyond the cloud and Blazers prepared to help lead the transition by bringing intelligence closer to where data is generated and decisions are made.
Speaker Change: We are focused on a clear opportunity delivering efficient flexible AI at the edge to meet real world customer needs. Our platform stands out by providing performance where it matters most close to the data in real time and under real world constraints.
We're executing against the roadmap scaling with discipline and making steady progress.
Dinakar Munugala: Thank you to our customers, partners, and stakeholders for your continued support. We are early in our journey, and I'm hopeful that the narrative that I have shared with you helps you understand the opportunity in this market and the capabilities Blaze can offer in the edge AI market. We look forward to sharing our growth as a public company.
Speaker Change: Thank you to our customers partners and stakeholders for your continued support.
Speaker Change: We had early in our journey and I am hopeful that the narrative that I have shared with you helps you understand the opportunity in this market and the capabilities <unk> can offer and the edge AI market.
Speaker Change: We look forward to sharing our growth as a public company.
Dinakar Munugala: and Momentum in the Quarters Ahead.
Speaker Change: And momentum in the quarters ahead now.
Harminder Simi: Now I'd like to hand over the call to our CFO, Harbinder Semi. Thank you, Dineker, and good afternoon, everyone. My name is Hamed El-Semi and I'm the Chief Financial Officer of Blaze.
Speaker Change: Now I'd like to handle the call to our CFO had been the semi.
Hum: Thank you Dennis and good afternoon, everyone. My name is Hum in the semi and I'm, the Chief financial officer of place before.
Harminder Simi: Before we begin, I'd like to reiterate that today's discussion will include forward-looking statements. Please refer to our earnings release and SEC filings for additional information.
Hum: Before we begin I'd like to reiterate that todays discussion will include forward looking statements. Please refer to our earnings release and SEC filings for additional information.
Harminder Simi: Our business combination with Burtek Acquisition Corp. closed on January 13 of this year, so my focus in this earnings call will be on our fiscal year 2024 results ending December 31. I will also provide guidance on the first quarter of 2025 and full fiscal year 2025. 2024 was a pivotal year for Blaze as we developed partnerships with selected hardware manufacturers and independent software vendors and established a revenue pipeline which is expected to start converting at scale in the second half of this fiscal year.
Hum: Our business combination with <unk> acquisition Corp closed on January 13 of this year. So my focus in this earnings call will be on our fiscal year 2024 results ending December 31.
Hum: I will also provide guidance for the first quarter of 2025 and full fiscal year 2025.
Hum: 2024, it was a pivotal year for place as we develop partnerships with selected hardware manufacturers.
Hum: Independent software vendors and established a revenue pipeline, which is expected to start converting at scale in the second half of this fiscal year.
Harminder Simi: Let's start with revenue for fiscal 2024. Revenue was $1.6 million compared to $3.9 million in the prior year. In both years, the revenues primarily reflected the recognition of strategic consulting fees. These were received from a major European automotive OEM as part of a multi-year and multi-vendor program aimed at developing an advanced L4 autonomous driving platform for the OEM. Phase one was largely completed during 2024. Revenues from automotive are several years away, given the design and manufacturing lead times associated with autonomous vehicles. Adjusted gross margin for 2023 and 2024 includes an allocation of direct labor costs in connection with the Strategic Consulting Program and adjustments for inventory cost realignment.
Hum: Let's start with revenue for fiscal 2024.
Hum: Revenue was $1 6 million compared to $3 $9 million in the prior year.
Hum: In both years the revenues primarily reflected the recognition of strategic consulting fees. These were received from a major European automotive OEM as part of a multi year and multi vendor program.
Hum: Aimed at developing an advanced L for autonomous driving platform for the OEM.
Hum: Phase one was largely completed during 2024.
Hum: Revenues from automotive are several years away given the design and manufacturing lead times associated with autonomous vehicles.
Hum: Yes.
Hum: Adjusted gross margin for 2023, and 2024 includes an allocation of direct labor costs in connection with the strategic consulting program and adjustments for inventory cost realignment.
Harminder Simi: I will discuss our future Adjusted Gross Margin trends shortly.
Hum: I will discuss our future adjusted gross margin trends shortly.
Harminder Simi: Now to our Operating Expenses. Selling general and administrative expenses for fiscal 2024, excluding depreciation and amortization, were $22.4 million, an increase of $5.1 million over fiscal 2023. This change reflects the investment in our preparation to transition into a public company and to scale our go-to-market capability globally. This came on top of exercising firm controls on holding down our expenditures in 2023. Our plans to grow costs in the future will be very closely tied to delivering revenue growth. Research and development costs grew by just under $7 million to $25.1 million in 2024, as we invested in technical resources, software tools, and third-party IP for our next-generation chips.
Hum: Now to our operating expenses.
Hum: Selling general and administrative expenses for fiscal 2024, excluding depreciation and amortization were $22 $4 million, an increase of $5 $1 million over fiscal 2023.
Hum: This change reflects the investment in our preparation to transition into a public company and to scale our go to market capability.
Hum: Locally.
Hum: This came on top of exercising firm controls on holding down our expenditures in 2023.
Hum: Our plans to grow costs in the future will be very closely tied to delivering revenue growth.
Hum: Research and development costs grew by just under $7 million to $25 1 million in 2024, as we invested in technical resources software tools and third party IP for our next generation chip.
Harminder Simi: We remain committed to driving long-term value through innovation. while ensuring an efficient allocation of capital. Our net loss for 2024 was $61.2 million, down 30% from the net loss of $87.6 million in 2023. The resultant adjusted EBITDA loss, excluding stock-based compensation and other non-cash items for fiscal 2024, was $43.3 million, compared to $30.3 million for fiscal 2023.
Hum: We remain committed to driving long term value through innovation.
Hum: While ensuring an efficient allocation of capital.
Hum: Our net loss for 2024 was $61 2 million down 30% from the net loss of $87 6 million in 2023.
Hum: The resulting adjusted EBITA loss, excluding stock based compensation and other noncash items for fiscal 2024 was $43 3 million.
Hum: To $30 3 million for fiscal 2023.
Harminder Simi: A brief comment on our cash position. The company held 50.2 million dollars on the balance sheet at 31st December 2024 and following the conclusion of the business combination in January this year when additional capital was raised through a private investment in public equity, we believe that Blaze is on a path to execute on its operating plan over the next 12 months.
Hum: A brief comment on our cash position the.
Hum: The company held $50 $2 million on the balance sheet at 30, <unk> December 2024, and following the conclusion of the business combination in January this year.
Hum: Additional capital was raised through a private investment in public equity. We believe that place is on a path to execute on its operating plan over the next 12 months.
Harminder Simi: In summary, 2024 was a year of transition for the company with capital raised before the transaction closed. We developed a strong revenue pipeline, which is continually growing, and invested in key partnerships in our chosen market. We will continue to evaluate capital allocation strategies that align with our long-term growth objectives of focusing on the edge AI opportunity.
Hum: In summary.
Hum: 2024 was a year of transition for the company with capital raised before the transaction closed.
Hum: <unk> developed a strong revenue pipeline, which has continued to growing and invested in key partnerships in our chosen markets.
Hum: We will continue to evaluate capital allocation strategies that align with our long term growth objectives of focusing on the edge AI opportunity.
Harminder Simi: Let's now turn to financial guidance. For fiscal 2025, we are reaffirming our revenue guidance range provided in February this year. We expect revenue to be in the range of $19 million to $50 million. The adjusted EBITDA loss is projected in the range of $70 million to $75 million. The stock-based compensation charge is expected to be around $20 million. As noted at the time we issued our 2025 guidance, we expect to see customer solutions being deployed in the second half of the year through a combination of hardware systems, software licenses, and professional services. We are still assessing the impact of recent tariffs on our adjusted gross margin percentage and plan to provide additional color during the year.
Hum: Let's now turn to financial guidance.
Hum: For fiscal 2025, we are reaffirming our revenue guidance range provided in February this year.
Hum: We expect revenue to be in the range of 19 million to $50 million.
Hum: The adjusted EBITDA loss is projected in the range of $70 million to $75 million.
Hum: The stock based compensation charge is expected to be around $20 million.
Hum: As noted at the time, we issued our 2025 guidance, we expect to see customer solutions being deployed in the second half of the year through a combination of hardware systems software licenses and professional services.
Hum: We are still assessing the impact of recent tariffs on our adjusted gross margin percentage and plan to provide additional color during the year.
Harminder Simi: Our chips are manufactured on U.S. soil, and we maintain very close relationships with our contract manufacturer to tailor supply to demand.
Hum: Our chips are manufactured on U S soil and we maintain very close relationships with our contract manufacturer.
Hum: Taylor supply to demand.
Harminder Simi: Now I'd like to share our guidance for the quarter ended March 31st, 2025. We expect revenue to be around $900,000, mainly from product shipments. We anticipate an adjusted EBITDA loss in the range of $15 million to $16 million. And finally, our stock-based compensation charge is estimated at $7.7 million. As our strategic partnerships continue to grow with more announcements planned this year, we expect that the revenue pipeline will reflect the large underlying customer pipelines that these partnerships are expected to bring to place. Solutions based on the current generation of silicon are expected to support revenue growth over the coming three plus years.
Hum: Now I'd like to share our guidance for the quarter ended March 31 2025.
Hum: We expect revenue to be around $900000, mainly from product shipments.
Hum: We anticipate an adjusted EBIT loss in the range of 15 million to $16 million.
Hum: And finally, our stock based compensation charges estimated at $7 7 million.
Hum: As our strategic partnerships continue to grow with more announcements planned. This year, we expect that the revenue pipeline will reflect the large underlying customer pipelines that these partnerships are expected to bring to place.
Hum: Solutions based on the current generation of Silicon are expected to support revenue growth over the coming three plus years.
Harminder Simi: These will coexist with products and solutions based on our next generation chip that opens additional revenue opportunities in Edge AI for Blaze.
Hum: These will coexist with products and solutions based on our next generation chip that opens additional revenue opportunities in edge AI for place.
Harminder Simi: In closing, Our merger enabled us to be funded, and we have an accelerating revenue pipeline across a variety of customers and partners. Blaze has been actively preparing to operate efficiently as a public company. We feel confident in our technology, long-term strategy, and adding shareholder value by delivering effective solutions into the large and rapidly growing edge AI market.
Hum: In closing.
Hum: Our merger enabled us to be funded and we have an accelerating revenue pipeline across a variety of customers and partners.
Speaker Change: Ladies has been actively preparing to operate efficiently as a public company.
Hum: We feel confident in our technology.
Hum: Long term strategy, and adding shareholder value by delivering effective solutions into the large and rapidly growing edge AI market.
Operator: With that, I'll turn it back over to the operator for questions and answers. Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please limit yourself to one question and one follow up. One moment for questions.
Speaker Change: With that I'll turn it back over to the operator for questions and answers.
Hum: Yes.
Hum: As a reminder to ask a question. Please press star one on your telephone and wait for your name to be announced to withdraw. Your question. Please press star one again, please limit yourself to one question and one follow up one moment for questions.
Alex Flatt: Our first question comes from Alex Flatt with D.A. Davidson. You may proceed.
Speaker Change: Our first question comes from Alex <unk> with D. A Davidson you May proceed.
Dinakar Munugala: Hi, this is Alex Platt, I'm for Gale Luria. I just have one question, maybe a more high level one, but sort of beyond hardware improvements. I'm sort of interested to know how you see the improvement of small models, I guess, parameter wise, contributing to long term adoption of edge AI solutions. And then maybe within that question, we know some of the use cases in verticals you can serve now or sort of in the near future, but are there any other areas that really get unlocked for you with drastically improved levels of intelligence in models? Thanks.
Hum: Thanks.
Hum: Alex <unk> on for Gil Luria I, just had one question, maybe a more high level one.
Hum: But sort of beyond hardware improvements.
Hum: I'm sort of interested to know how you see the improvement of small models I guess parameter wise.
Hum: Contributing to long term adoption of edge AI solutions.
Hum: Within that question.
Hum: I know some of the use cases and verticals you can serve now or sort of in the near future, but are there any other areas that really get unlocked for you with drastically improved intelligence levels of intelligence in our models. Thanks.
Hum: Thanks for the question regarding the small language models specifically.
Hum: Yeah.
Hum: Deep sea has shown that.
Hum: Models will continue to shrink.
Hum: And there are several efforts in this space.
Dinakar Munugala: Small language models, what it essentially does is it truly democratizes AI. We're talking about not one. In fact, the initial shipments that have been announced... So this is actually quite a good thing for edge computing. Particularly, Blaze Architecture, which is programmable to be able to... In addition, your question was also about... Although we're focused on initially computer vision, public safety, smart city, that area, this is definitely going to impact all the major edge computing. Thank you. And as a reminder, to ask a question, please press Star-11 on your telephone.
Hum: And small amount language models, what essentially does is it true.
Hum: Democratizes AI and these can devote will be shifted more and more towards the <unk>.
Hum: So we're talking about not one X to X plus index kind of shrinking of AI models.
Hum: In fact, the initial shipments that have been announced.
Hum: Through multimodal.
Hum: In the space of these models.
Hum: So this is actually quite a <unk>.
Hum: Quite a good thing for edge computing.
Hum: Particularly place architecture, which is programmable too to be able to address this.
Hum: In addition to your question was also about.
Hum: Other areas.
Hum: And definitely this is something that will.
Hum: Although we are focused on initially computer vision and public safety Smart City area. This is definitely going to impact all of the major.
Hum: <unk> use cases and determine that add anymore.
Speaker Change: No I think that's fine you have covered it thank you.
Speaker Change: Thank you and as a reminder to ask a question. Please press star one on your telephone.
Kevin Cassidy: Our next question comes from Kevin Cassidy with Rosenblatt Securities. He may proceed. Hi, yes, thanks for taking my question. Just as you're looking at this huge market that you're looking at, you know, how do you filter out which programs or which partners you choose just to make sure you're getting the best ROI. Value Customers, High Contract Value Customers that we engage directly. But also we engage with the ecosystem, right? The ecosystem comprises ISP partners, as well as system integrators. Targeting End Customers. So, the idea is that... Through the high-value customers, we go direct. And as we engage with the ecosystem.
Operator: Our next question comes from Kevin Cassidy with Rosenblatt Securities You May proceed.
Kevin Cassidy: Hi, yes, thanks for taking my question.
Operator: As you are looking at this huge market.
Operator: How do you filter out which.
Operator: Programs are which partners you choose.
Operator: Just to make sure you're getting the best ROI.
Operator: So.
Operator: Good market has.
Operator: Two two ways, we go to market.
Operator: One is high value high.
Operator: Value customers high contract value customers that we engage directly.
But also we engaged with the ecosystem the ecosystem comprises ISP partners as well as system integrators.
Operator: Targeting and customers.
Operator: So so.
Operator: The idea is that.
Operator: Through the high value customers, we go direct and as we engage with the ecosystem.
Dinakar Munugala: and land a particular use case with a particular end customer. Their pipeline, the ISP's pipeline, also becomes... So there's a multiplier effect there. So by going direct, we also focus on the landing, expand within the individual customer. And with the ecosystem as we engage, we have a multiplier effect also that grows the pipeline. So that's the combination.
Operator: Land particular use case with a particular end customer.
Operator: Their pipeline the Isps pipeline also become ours so.
Operator: There is a multiplier effect there so by going direct.
Operator: Also focus on Atlantic expand within the individual customer and with the ecosystem as we engage.
Operator: We have a multiplier effect also that growth the pipeline. So that's the combination.
Harminder Simi: I'll let Hamid to add as well. Yeah, thank you, Dirk. I'll amplify a couple of. So, one thing to note is that the AI algorithm... that behind each of these use cases are largely similar. So when we've selected our ecosystem partners, what we're doing is making sure that the beachhead customer, i.e. the first customer that we're going to go deploy the solution with. And as Dineke mentioned, the Landon Expand, where the second customer, the tenth customer, the hundredth customer in that vertical. As our roadmap expands, we will open up other verticals, but for now, our focus, our pipeline is based on the focus.
Pat: Pat as well.
Pat: Thank you Jessica I'll amplify a couple of things.
Pat: We are very focused on specific areas just from the re allocation of resources. So one thing to notice is the AI algorithms.
Pat: Behind each of these use cases are largely similar.
Pat: So when we have selected our ecosystem partners, what we're doing is making sure that the beachhead customer.
Pat: First customer that we're going to deploy the solution with <unk>.
Pat: We test we pilot and we make sure that their solutions are relevant for them and as Dennis mentioned, the land and expand where the second customer the 10th customer the 100 customers in that vertical.
Pat: The path to revenue is much much faster with the with those.
Pat: With those customers.
Pat: As our roadmap expense.
Pat: We'll open up other verticals, but for now our focus.
Pat: Pipeline is based on the focused smart cities some defense type of.
Pat: Customers.
Dinakar Munugala: Okay, I see. Great, thanks. And, you know, just some of your new system partners, have they tested your chips using DeepSeq? Each customer, of course, has different flavors of Language Models as well as Computer Vision Algorithms. But as you know, it is this phi. There's GEMMA, there's others which also fall in a similar category of multimodal issues. So the key is multi-modal AI. We happen to be very unique in that our processor architecture is completely programmable. And therefore, as the world is making this huge transition to incorporate true multi-modal AI. We're here and ready, right?
Speaker Change: Okay, great. Thanks.
Pat: Just some of your new system partners.
Pat: Have they tested.
Pat: Chips using deep seek.
Pat: Each customer of course has different flavors of.
Pat: Language models as well as computer vision algorithms.
Pat: Deep six who happens to be a certain flavor of language model.
Pat: But as you know it is this fi.
Pat: Jim.
Pat: Others, which also fall in a similar category of multimodal AI.
Pat: So the key is multimodal AI, we happen to be very unique in that our processor architecture is completely programmable and therefore as the world is making this huge transition.
Pat: To incorporate true multimodal AI.
Pat: We are here and ready right the combination of our programmable processor and our software stack.
Dinakar Munugala: The combination of our programmable processor and our software stack is coming in very handy to us. So, different flavors, but the commonality is how we actually uniquely. Okay, I see. Yeah.
Pat: <unk> is coming in very handy to our partners and customers.
Pat: So different flavors, but the commonality is.
Pat: We actually uniquely activated.
Pat: Okay.
Harminder Simi: And just one other question, more on the balance sheet. The inventory you're holding, is that products? Is that those in dye form? Or is that something else? I guess what is what is being held in inventory, about $8 million? Yeah, that's all finished good. We have a contract manufacturer. There will be certain chips in there, too. But all PCI cards, various phone... Thank you.
Pat: And just one other question.
Pat: On the balance sheet the inventory you're holding.
Pat: Is that product.
In die form or.
Pat: Is that something else, but I guess, what is what is being held in inventory about $8 million.
Pat: Yes, that's all finished good.
Pat: Have a contract manufacturer or there'll be certain chips in there too just the <unk>.
Pat: But all PCI.
Pat: PCI cards various form factors.
Pat: What we have so we are ready to ship.
Pat: Thank you.
Richard Shannon: Our next question comes from Richard Shannon with Craig Hallam Capital Group. Thanks for taking my questions as well.
Speaker Change: Our next question comes from Richard Shannon with Craig Hallum Capital Group You May proceed.
Richard Shannon: Hi, guys. Thanks for taking my questions as well.
Richard Shannon: Maybe I'll ask the first one on the pipeline to choose a versus. The pipeline progress, it's the last time we published in here to be filing very early this year, they get pipeline hundreds of millions of dollars.
Richard Shannon: Maybe I'll ask the first one on the pipeline since June persisted.
Speaker Change: During the prepared remarks.
Richard Shannon: If you did the quantifier.
Speaker Change: Okay.
Speaker Change: <unk> progress.
Speaker Change: Last night, we published earlier this year.
Speaker Change: Okay.
Speaker Change: Hundreds of millions of dollars.
Speaker Change: So.
Operator: Sorry, may I have a message to the moderator?
Speaker Change: Add to that some sorry.
Speaker Change: Our message to the moderator with Josh Richard Your line is breaking up I don't know if it's just for us, but it's breaking up so they're difficult to follow you.
Operator: Josh, Richard, it's your line is breaking up. I don't know if it's just for us, but it's breaking up. It's very difficult to follow you.
Operator: Hello.
Speaker Change: Hello.
Speaker Change: Richard can you hear us.
Operator: Pardon me, it looks like Richard is disconnected.
Speaker Change: Pardon me it looks like Richard is disconnected.
Dinakar Munugala: I'll turn the call back over to Dinakar Munagala for any closing remarks. I think Richard's question was, should we wait for Richard or close the call?
Dennis Hum: I'll turn the call back over to Dennis <unk> for any closing remarks.
Speaker Change: So.
Speaker Change: I think.
Speaker Change: Third question was should we wait for Richard close the call I guess.
Speaker Change: Okay.
Dinakar Munugala: Thank you all for joining and we look forward to. We look forward to updating you as we make progress for the business in the near term and the coming. Thank you.
Speaker Change: Thank you all for joining and we look forward to updating you as we make progress with our business in the near term in the coming quarters.
Operator: This concludes the conference. Thank you for your participation.
Speaker Change: Thank you. This concludes the conference. Thank you for your participation you may now disconnect.
Speaker Change: Okay.
Speaker Change: [music].
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: [music].