Q1 2025 Research Frontiers Inc Earnings Call
Good afternoon, and welcome to the research Frontiers Investor Conference call to discuss the first quarter of 2025 results of operations and recent developments.
Operator: Good afternoon, and welcome to the Research Frontiers and Vest-.
Operator: discuss the first quarter of 2025 results of operation. The company will be answering many of the questions that were emailed prior to the conference call either in their presentation or as part of the Q&A session at the end. In some cases, the company has responded directly to email questions prior to the call or will do so after the call.
The company will be answering many of the questions that were emailed prior to the conference call either in their presentation or as part of the Q&A session. At the end in some cases. The company has responded directly to email questions. Prior to the call or will do so afterwards in order to answer more questions of general interest to shareholders on this call some steam.
Operator: in order to answer more questions of general interest to share.
Operator: Some statements today may contain forward identified by words such as expect and These reflect current beliefs and actual results may differ materially from those expressed due to various risk factors.
With us today may contain forward looking information identified by words, such as expect anticipate and forecast. These.
These reflect current beliefs and actual results may differ materially from those expressed.
Various risk factors, including detailed in our SEC filings research Frontier assumes no obligation to update or revise these statements today's call is in listen only mode with a Q&A session to follow to ask a question press star one the call's being recorded and will be made available for replay of research frontiers website at smart glass style.
Operator: Tear assumes no obligation to update or revise the SAC filings.
Operator: Today's call is in listen-only mode with a Q&A session to follow.
Operator: To ask a question, press star 1.
Operator: The call is being recorded and will be made available for replay on Research Frontier's website at smartglass.com for the next 90 days. If you find that your question has been substantially answered, as a courtesy and to allow time for other shareholders to ask their questions.
Com for the next 90 days.
If you find that your question has been substantially answered I think courtesy and to allow time for other shareholders to ask their question.
Operator: Please remove yourself from the queue by pressing Also, we ask that you keep your question brief.
You remove yourself from the queue by pressing pound one.
Speaker Change: Also we ask that you keep your question brief in the interest of time I will now turn the conference over to Joe Harare, President and Chief Executive Officer of Research Frontiers. Please go ahead Sir.
Joseph Harary: I will now turn the conference over to Joe Harary, President and Chief Executive Officer of Research Frontiers. Please go ahead. Thank you, Erica.
Joe Harare: Oh, Thank you, Eric and Hello, everyone and welcome to our first quarter of 2025 Investor Conference call.
Joseph Harary: Hello, everyone, and welcome to our first quarter of 2025 investor conference call. Let's start with our financial results. I'm pleased to report that the first quarter of 2025 marked another strong period of revenue growth and momentum for Research Frontiers, driven by increased demand for SPD smart glass, particularly in the automotive sector and also in the aircraft sector, with growing interest in new projects in the architectural market. Our royalty revenues in Q1 2025 were up over 79% to $560,000. This was an increase of more than $246,000 over the first quarter of 2024. Also, significantly, royalty income was up 214% or up $382,000 sequentially from the previous quarter, Q4 2024.
Joe Harare: Let's start with our financial results.
Joe Harare: I'm pleased to report that the first quarter of 2025 marked another strong period of revenue growth and momentum for research frontiers, driven by increased demand for SPD smart glass, particularly in the automotive sector and also in the aircraft sector with growing interest in new projects in the architectural market.
Joe Harare: Our royalty revenues in Q1 2025 were up over 79% to $560000. This was an increase of more than $246000 over the first quarter of 2024.
Joe Harare: Also significantly royalty income was up 214% or up $382000 sequentially from the previous quarter Q4 2020 for.
Joseph Harary: This increase was primarily the result of higher royalties from the automotive market. up 128% compared to Q1 2024 and up 267% compared to our previous quarter, Q4 2024. Revenues from the aircraft market were also up sequentially in Q1 2025 compared to the prior quarter, Q4 2024. And we expect revenue in all market segments to increase further as new car models and other products using the company's SPD smart glass technology are introduced into the market.
Joe Harare: This increase was primarily the result of higher royalties from the automotive market.
Joe Harare: 128% compared to Q1, 2024, and up 267% compared to our previous quarter.
Joe Harare: Q4 2024 reps.
Joe Harare: Revenues from the aircraft market were also up sequentially in Q1 2025 compared to the prior quarter Q4, 2024, and we expect revenue in all market segments to increase further as new car models and other products using the Companys SPD Smart glass technology are introduced into the market.
Joseph Harary: As a consequence of these factors, our net loss was $177,687, or one cent per common share, for the three months ended March 31, 2025. And this was $265,000, or 60% lower than the first quarter of last year.
Joe Harare: As a consequence of these factors our net loss was $177687 or one per common share for the three months ended March 31, 2025, and this was $265000 or 60% lower than the first quarter of last year.
Joseph Harary: Turning to our financial condition and liquidity, we continue to manage our resources effectively. As of March 31, 2025, our cash and cash equivalents stood at approximately $1.4 million and our working capital was approximately $2.3 million. We continue to be debt-free. Based upon our current operations, we believe our current cash and cash equivalents would fund our operations for more than the next five years. We do not need to raise capital at this time and do not anticipate doing so unless there's a strategic reason to do so.
Joe Harare: Turning to our financial condition and liquidity, we continue to manage our resources effectively.
Joe Harare: As of March 31, 2025, our cash and cash equivalents stood at approximately $1 $4 million and our working capital was approximately $2 $3 million, we continue to be debt free.
Joe Harare: Based upon our current operations, we believe our current cash and cash equivalents would fund our operations for more than the next five years, we do not need to raise capital at this time and do not anticipate doing so unless there's a strategic reason to do so.
Joseph Harary: We continue to see progress and significant developments across our markets. Our SPD smart technology is currently licensed or used by many major companies serving five major application areas, aerospace, architectural, automotive, marine, and display products in almost every country of the world.
Joe Harare: We continue to see progress and significant developments across our markets. Our SPD Smart technology is currently licensed or used by many major companies serving five major application areas aerospace architectural automotive marine and display products in almost every country of the world.
Joe Harare: Okay.
Joseph Harary: I've been asked about other technologies being used.
Speaker Change: I've been asked about other technologies being used you know when I first joined research frontiers as the head of L. B N L laboratories in charge of the Smart window project told me to keep an eye on to companies who are the most advanced in the world.
Joseph Harary: You know, when I first joined Research Frontiers, the head of LBNL Laboratories, in charge of the Smart Window Project, told me to keep an eye on two companies who are the most advanced in the world, Asahi and Isoclima. At the time, both were focusing on electrochromics, a competitive technology to SPD. It's telling that both are now active licensees of ours for SPD Smart Lab. You know, along the way, many other companies became, frankly, roadkill on the side of the smart glass road. Some crossed over to us, like Asahi and Isuk Lima. Some asked us to bail them out, I won't name names, and some stubbornly stuck to losing technologies with the hope of breakthroughs and miracles that have eluded them for decades.
Joe Harare: He and he's so claim.
Joe Harare: At the time.
Joe Harare: Both were focusing on electric comex, a competitive technology to S. P D.
Joe Harare: It's telling that both are now active licensees of bars for SPD smart glass.
Speaker Change: Along the way many other companies became frankly roadkill on the side of the Smart glass road, some crossed over to us like Asahi and used to clean them up.
Joe Harare: Some asked us to build them out I won't name names and some stubbornly stuck to losing technologies with the hope of breakthroughs in miracles that have alluded them for decades.
Joseph Harary: Two companies in our industry filed for bankruptcy this past year, Vue and Haleo, while another has gone relatively quiet in the market and has yet to come out with even a rudimentary smart product. Throughout these industry challenges, Research Frontier has never wavered from our mission. Our success stems from having the best performing smart glass technology paired with a low risk business model that preserves our upside while encouraging diversification and a robust global footprint. A recent example of the benefits of our approach was highlighted in Gauzy's recent press release about the lack of any meaningful impact of tariffs on their business.
Joe Harare: Two companies in our industry filed for bankruptcy this past year view and Haley all while another is gone relatively quiet in the market and is yet to come out with even a rudimentary smart product.
Joe Harare: Yeah.
Joe Harare: Throughout these industry challenges research frontiers has never wavered from our mission.
Joe Harare: Our success stems from having the best performing smart glass technology paired with our low risk business model that preserves our upside while encouraging diversification and a robust global footprint.
Joe Harare: A recent example of the benefits of our approach was highlighted in <unk> recent press release about the lack of any meaningful impact of tariffs on their business and this is something I had also indicated with our business on the last conference call in March and we received a number of questions about this that were emailed to us.
Joseph Harary: And this is something I had also indicated with our business on the last conference call in March.
Joseph Harary: And we received a number of questions about this that were emailed to us. This also further demonstrates the logistical advantage of our film technology. It also certainly reinforces the strength of our business model and of the strategic partnerships we've built. We've spoken in the past about key developments in the automotive market. Royalty increases in this sector were a major driver of our Q1 growth. We continue to see significant momentum in automotive, with new car models expected to be introduced in 2025 using our SPD smart glass technology. Q4 saw the introduction of the SBD smart glass for the Cadillac Celestic and Q1 2025 showed somewhat higher sales to Cadillac.
Joe Harare: This also further demonstrates the logistical advantage of our film technology. It also certainly reinforces the strength of our business model and have the strategic partnerships we've built.
Joe Harare: We've spoken in the past about key developments in the automotive market royalty increases in this sector were a major driver of our Q1 growth. We continue to see significant momentum in automotive with new car model is expected to be introduced introduced in 2025, using our SPD smart glass technology.
Joe Harare: Q4 saw the introduction of the SPD smart glass for the Cadillac Scholastic and Q1 2025 showed somewhat higher sales to Cadillac.
Joseph Harary: The production callouts by Cadillac point to significantly higher royalties from GM in our current second quarter of 2025 as production ramps. Similarly, we had strong sales from Ferrari in Q1 2025 and expect strong sales from Ferrari for the current quarter, Q2 2025, based upon their production call-outs to our licensee. Also, I think everyone was pleased to see from our press release in April, and also Gowsey's, that Mercedes is back in the picture with their luxury van that debuted at the Shanghai Motor Show.
Joe Harare: The production call outs by Cadillac point to significantly higher royalties from GM and our current second quarter of 2025 as production ramps. Similarly, we had strong sales from Ferrari in Q1, 2025, and expect strong sales from Ferrari for the current quarter Q2 2025.
Joe Harare: Based upon their production call outs to our licensee.
Joe Harare: Also I think everyone was pleased to see from our press release in April and also galaxies that Mercedes is back in the picture with their luxury van that debuted at the Shanghai Motor show.
Joseph Harary: What's unique here is one, that is in an area other than the sunroof, and two, it is unique in that it uses in the side windows a combination of SPD PDLC on 75% of the van's glass.
Joe Harare: What's unique here is one that is in an area other than the sunroof and two it is unique in that it uses in the side Windows a combination of SPD PD L. C on 75% of the vans glass right.
Joseph Harary: Now let me take a question that was emailed to me from Mr. Erdman. What is the advantage of a dual stack smart glass combining SPD and PDLC over SPD only? Well, SPD by itself works fine for shading and privacy, but when you want privacy with light coming in, and remember, we're dark in privacy, you might want to use a combination of the two.
Joe Harare: Now let me take your question that was emailed to me from Mr. Erdmann, what is the advantage of a dual stack smart glass, combining SPD and PD L C over SPD only.
Joe Harare: Well SPD by itself works fine for shading and privacy, but when you want privacy with light coming in and remember were dark and privacy you might want to use a combination of the two.
Joseph Harary: And also, in areas where you're projecting an image, it's somewhat more like a movie screen in a theater with PDLC, so it's a visual effect sometimes with displays that you want. That becomes less relevant, by the way, in a world where most of the displays are embedded inside the glass and things like transparent OLEDs, which is a very interesting market for us.
Joe Harare: And also in areas, where you're projecting an image it's somewhat more like a movie screen in a theater with PD L. C. So it's a visual effect, sometimes with displays that you want.
Joe Harare: That becomes less relevant by the way in a world where most of the displays are embedded inside the glass in things like transparent OLED, which is a very interesting market for us.
Joe Harare: Yeah.
Joe Harare: Okay.
Joe Harare: Okay.
Joseph Harary: On prior calls, I mentioned new car models in Asia, Europe, and in the U.S. These are still on track.
Speaker Change: On prior calls I've mentioned, new car models in Asia, Europe and in the U S.
Joe Harare: These are still on track.
Joseph Harary: And while I can't discuss the details yet, we have also landed another European car model to the mix since our last conference call together in March. Revenues from this are not reflected in our first quarter royalties.
Joe Harare: And while I can't discuss the details yet we have also landed another European car model to the mix since our last conference call together in March.
Joe Harare: Revenues from this are not reflected in our first quarter royalties.
Joseph Harary: Yesterday, I received several email questions about the electrochromatic roof on the new 2026 Corvette, and I can't provide any details about that at this time. It's up to GM to decide to what extent they want to talk about that.
Joe Harare: Yesterday I received several email questions about the electric chromatic roof on the new 2026 corvette and I cant provide any details about that at this time, it's up the GM to decide to what extent they want to talk about this.
Joseph Harary: In the architectural market, we are excited about the potential for growth. We have begun work on private projects utilizing SPD Smart Lab. We're looking forward to the launch of the retrofit application, and our licensee in this area has projected a strong second half of this year.
Joe Harare: In the architectural market, we're excited about the potential for growth we have begun work on private projects utilizing SPD smart glass, we're looking forward to the launch of the retrofit application and our licensee in this area has projected a strong second half of this year.
Joseph Harary: We also believe... What we believe is a game-changer for the industry is the retrofit application by significantly simplifying installation, reducing costs, and minimizing disruption, while upgrading building envelopes to make them smarter and more energy efficient. And supplying government buildings is a very large opportunity, and regulatory support such as the Dynamic Glass Act, which offers substantial tax credits of between 30 and 50 percent, should help the private sector adopt SPD Smart Glass in buildings and homes as well.
Joe Harare: We also believe.
Joe Harare: What we believe is a game changer for the industry as the retrofit application by significantly simplifying installation, reducing costs and minimizing disruption, while upgrading building envelopes to make them smarter and more energy efficient.
Joe Harare: And supply and government buildings is a very large opportunity and regulatory support such as the dynamic Glass Act, which offers substantial tax credits of between 30% and 50% should help the private sector adopt SPD smart glass and buildings and homes as well.
Joe Harare: Jeff H Emailed me, what does research frontiers doing to tell that story because it sounds like you have one to tell well, we certainly do.
Joseph Harary: Jeff H emailed me, ìWhat is Research Frontiers doing to tell a story because it sounds like you have one to tell?î Well, we certainly do. One thing is weíve been working very closely and thatís increasing with Galsy to get the word out. They have substantial sales and marketing resources and we coordinate with them. Theyíre also quite good at social media and other digital marketing and we coordinate with them as well on this as well as business development.
Joe Harare: One thing is we've been working very closely and that is increasing with galaxy to get the word out they have substantial sales and marketing resources and we coordinate with them.
Joe Harare: They're also quite good at social media and other digital marketing and we coordinate with them as well on this as well as business development and we recently had some high level discussions about DB doing even more together.
Joseph Harary: We recently had some high-level discussions about doing even more together.
Joe Harare: Yeah.
Joseph Harary: We also know we needed to update our website and we did more than that.
Joe Harare: We also know we needed to update our website and we did more than that it's been totally redesigned and we'll be working on the pre on the final prelaunch steps. This weekend and expect to go live by early next week and I think you all are going to love it and find it a great tool for sharing information with others.
Joseph Harary: It's been totally redesigned and we'll be working on the final pre-launch steps this weekend and expect to go live by early next week. And I think you all are going to love it and find it a great tool for sharing information with others. By the way, our web address is smartglass.com if anyone wants to check it out or peek in maybe over the weekend.
Joe Harare: Several and by the way our web addresses smart glass dot com, if anyone wants to check it out or peak and maybe over the weekend.
Joseph Harary: Several shareholders have asked about what catalysts we see for our company, our revenue, and our stock price. Jared asks, do you see a catalyst or a combination of price, performance, and availability that finally meets the value proposition, or does success remain out of reach? I think that the steady improvement, Jared, that we made in the growing revenues and approaching breakeven while others in our industry have failed certainly means that we are on the right track and nothing is out of reach.
Joe Harare: Several shareholders have asked about what catalysts, we see for our company, our revenue and our stock price.
Joe Harare: <unk> do you see a catalyst or a combination of price performance and availability that finally meets the value proposition or just success remain out of reach.
Joe Harare: Well I think that the steady improvement Jared that we've made in the growing revenues and approaching breakeven while others in our industry have felt certainly means that we are on the right checks and nothing is out of reach and I'll talk more about this in my closing remarks later, but certainly the catalysts are happening in terms of price performance and availability.
Joseph Harary: And I'll talk more about this in my closing remarks later. But certainly the catalysts are happening in terms of price performance and availability of the product. As I mentioned, we've included some of the questions previously sent in by our shareholders in the presentation today, and with that, I look forward to answering the questions that I've not already answered in the course of my presentation. And we ask that you keep your questions limited to questions of general interest. We can always talk about specifics after the call. And if you want to get into more specifics, you can do so by email or calls offline.
Joe Harare: Of the product.
Joe Harare: As I mentioned, we've included some of the questions people have previously sent in by our shareholders in the presentation today and with that I look forward to answering the questions that have not already answered in the course of my presentation.
And we ask that you keep your questions limited to questions of general interest. We can always talk about specifics after the call and if you want to get into more specifics.
Joe Harare: You can do so by email or calls offline I'll now ask that our operator Erica to open up the conference to any additional questions people participating today might have that we haven't already covered.
Operator: I'll now ask that our operator, Erica, to open up the conference to any additional questions people participating today might have that we haven't already covered. If you would like to ask a question, please press star 1 on your telephone keypad now. You'll be placed into the queue in the order Prepare to ask your question when prompted. Once again, if you have a question, please press star 1 on your phone.
Joe Harare: If you would like to ask a question. Please press star one on your telephone keypad now you'll be placed into the queue in the artery themed please be prepare to ask a question. When prompted once again if you have a question. Please press star one on your phone now.
Francis Coturbo: Our first question comes from Francis Coturbo, please state your question. Uh, yeah. Hello, Joe. How's it going? Hey, how's it going? Pretty good.
Joe Harare: Our first question comes from Francisco Chavez. Please state your question.
Speaker Change: Yeah, Hello, Joel How's it going.
Joe Harare: Hey, How's it going.
Speaker Change: Pretty good.
Francis Coturbo: You didn't mention anything about the dark particle and why you defined it.
Joe Harare: You didn't mention anything about the dark particle.
Speaker Change: And while yes, thank you Luke.
Francis Coturbo: Why do you define it as the Holy Grail? And number two, we'll. Whenever it is available and it's used in various different products, it will be a combination of just a black part, dark particle, and PLDC. or we'll just be the dark. and the great questions.
Speaker Change: Why do you defined it as the Holy Grail.
Speaker Change: And number two will.
Speaker Change: Whenever it is available and it's used in various different products will be a combination of just the blackboard dark particle and Peel D C.
Or will just be the dark bar.
Speaker Change: And okay designating Mike great questions.
Joseph Harary: When might it be available? Okay, these are all great questions, and I'll answer what I can. Also, we got similar questions from John Nelson and Mike White. So, thanks for asking about the black particle. So, we announced, together with Gauzy, the black particle in January at the Consumer Electronics Show in Las Vegas. And we demonstrated that, a film, using it behind closed doors to key people and it was very, very well received. And since then, we and Gauzy have done a significant amount of work together on advancing it towards commercialization. And I hope to be able to share some very good news about that.
Speaker Change: When might it be available.
Speaker Change: Okay. These are all great questions and I'll answer what I can also we got similar questions from.
Speaker Change: From John Nelson, and and Mike White, so thanks for asking about the black particle.
Speaker Change: We announced together with gals, either black particle in January at the consumer Electronics show in Las Vegas, and we demonstrated that.
Speaker Change: Our film using it.
Speaker Change: Behind closed doors to keep people in the industry and it was very very well received and since then we.
Speaker Change: And Ghazi have done a significant amount of work together on advancing it towards commercialization and I hope to be able to share some very good news.
Joseph Harary: But I think the way you're going to hear that news is we'll announce the final product, you know, is in production. You asked, why is it the Holy Grail? Well, Some of it is technical, and some of it is aesthetic. The aesthetic would be that. it's more of a neutral color. So if you are not just looking through a sunroof, but let's say you're looking through a side window of a car, you may not wanna see blue as much as you would through a sunroof where people are used to seeing blue sky. The other is technical.
About that.
Speaker Change: But I think the way you're going to hear that news as we will announce the final product.
Speaker Change: It was in production.
Speaker Change: You asked why is it the Holy Grail well.
Speaker Change: Some of it is technical and some of it is a static the aesthetic would be that.
Speaker Change: It's more of a neutral color. So if you are not just looking through a sunroof, but lets say youre looking through a side window of a car you may not want to see blue as much as you went through a sunroof where people are used to seeing.
Speaker Change: Blue Sky.
Speaker Change: The other is tactical so the reason that our.
Joseph Harary: So the reason that our Current particle looks like a sapphire blue is because it blocks in all areas of the spectrum except one, which is the dark blue. So the dark blue in sunlight gets transmitted, thus giving it a blue color. If you can also block in the dark blue... then you're going to have far less light coming through. So while in the dark state of a current SPD, there's 99.5% of the light being blocked, that half of 1% is still coming through and making it look blue. If you're able to close up that gap.
Speaker Change: Current particle looks.
Speaker Change: Like a sapphire blue is because it blocks in all areas of the spectrum, except one which is the dark blue.
Speaker Change: So the dark blue and suddenly it gets transmitted that's giving it a blue color. If you can also block in the dark blue.
Speaker Change: And then youre going to have far less light coming through so while in the dark state of our current SPD Theres 99, 5% of the light being blocked that half of 1% is still coming through and making it look blue if you were able to close up that gap.
Joseph Harary: It's going to look opaque. so you wouldn't see any image or any colors through that. You asked about, would it be used in combination with PDLC? And it depends on what you're trying to achieve. For the most part... SPD by itself or PDLC by itself are good at achieving privacy. maybe there would be a slight advantage in the black with more privacy, but not a meaningful amount where it would be the reason you would go black versus blue. And if you recall the question I answered earlier, with PDLC, a lot of times it's when you want to have privacy with light coming through, because PDLC doesn't block light, it scatters it.
Speaker Change: Is gonna look opaque so.
Speaker Change: So you won't see any image or any any colors food that you asked about would it be used in combination with PD L C and.
Speaker Change: It depends on what you're trying to achieve for the most part.
Speaker Change: S. P D by itself for PD L. C by itself are good at achieving privacy.
Speaker Change: Maybe there would be a slight advantage in the black with with more privacy, but not a meaningful amount where he would be the the reason you would go black versus blue.
Speaker Change: And if you recall the question I answered earlier with PD L. C. A lot of times. It's when you want to have privacy with light coming through because PD L. C. It doesn't block light it scattered set so it allows light to come come through but it does achieve privacy and it does have some advantages.
Joseph Harary: So it allows light to come through, but it does achieve privacy, and it does have some advantages in terms of getting that movie theater type screen look when you're going for that in a display application.
Speaker Change: In terms of getting that movie theater type screen look when you're when you're going for that in a display application.
Joseph Harary: But for the most part, I think a black would be a significant development in the industry. I think that it would give architects and designers the ability to have a more neutral color, and I think that would be useful, you know, especially in things like vertical windows on the side of cars or buildings.
Speaker Change: But for the most part.
Speaker Change: I think a black would be as you know a significant.
Speaker Change: Development in the industry I think that it would give architects and designers the ability to have a more neutral color and I think that would be useful.
Speaker Change: Especially in things like vertical windows on the side of cars or buildings.
Joseph Harary: I think other than the timing issue, which I can't answer at this point, I've answered that. But if I forgot anything, let me know.
Speaker Change: I think other than the timing issue, which I can't answer at this point.
Speaker Change: I've I've answered that but if I forgot anything let me know.
Joseph Harary: Has there been any projects that have been put on hold waiting for the commercialization of the dark particle? No, no, but it's certainly an improvement in performance. And, you know, we always are striving for better, better performance.
Speaker Change: Has there been any projects that have been put on hold waiting for the commercialization of the dark particle.
Speaker Change: No no, but it's certainly an improvement in performance and we always are striving for better better performance.
Joseph Harary: The upcoming shareholders meeting, is that going to be open or? It's open to everybody to attend. It's at Research Frontiers.
Speaker Change: Mhm the upcoming shareholders' meeting is that going to be open or.
Speaker Change: I was hoping to everybody and.
Speaker Change: It's open to everybody to attendance at research frontiers.
Joseph Harary: Ever since we've started to do quarterly conference calls with investors, it used to be that the annual meeting was the main opportunity to get a report on the operations of the company. Given the fact that it's only a few weeks away, the different quarterly calls are really where we've chosen to give more fuller updates.
Speaker Change: Like in.
Speaker Change: Ever since we've started to do quarterly conference calls with investors it used to be that the annual meeting was the main.
Speaker Change: Opportunity to get a report on the operations of the company.
Given the fact that it's only a few weeks away.
Speaker Change: You know the different quarterly calls are really where we've chosen to give.
Speaker Change: A more fuller update so it's probably mostly going to be an administrative meeting where officers are directed at Oh elected and I'm, sorry directors are elected and.
Joseph Harary: It's probably mostly going to be an administrative meeting where directors are elected and the agenda items are put up for a vote, but it's not going to be one where there's going to be You know, a new report, unless of course something happens, in which case we'll announce it regardless of whether there's an annual meeting or not. But everyone is encouraged to attend, and please vote, it's important to vote.
Speaker Change: The agenda items or are put up for a vote, but it's not going to be one where theres going to be.
Speaker Change: A new report unless of course, something happens in which case, we will announce it regardless of whether there's an annual meeting or not.
Speaker Change: But every one of you don't have encouraged to attend and and please vote, it's important to vote.
Joseph Harary: Do you have any products to demonstrate there? We have a whole design center here, so if you're in the Woodbury area and you want to see some really cool smart glass that's operated by Amazon Alexa or automatically through sensors or through a whole variety of things, you're welcome to come and experience that. But you don't have to wait for the annual meeting. Come anytime you want. I'm here.
Speaker Change: Do you have any products demonstrate there.
Speaker Change: We have a whole design center here, so if youre in the Woodbury area and you want to see some really cool smart glass, that's operated by Amazon Alexa or automatically through sensors or through a whole variety of things that you're welcome to come in and experience that but you don't have to wait for the annual meeting come anytime you want I'm here.
Speaker Change: Sure.
Joseph Harary: Are any of the products have the dark particle? No, we're not showing that until it's commercial. Kay?
Speaker Change: Are any of the products have to dark particle.
Speaker Change: No we don't we're not showing that until it's commercial.
Speaker Change: Okay. Thanks.
Joseph Harary: Except the people that are developing products-based. Okay, thanks.
Speaker Change: Except it except to people that are developing products based on it.
Speaker Change: Okay. Thanks.
Joseph Harary: While I'm at it, there is another question from John Nelson.
Speaker Change: While I'm at it there was another question from John Nelson and John by the way I. Appreciate the fact that you've substantially increased your ownership even beyond what's listed in our proxy statements I think you.
Joseph Harary: And John, by the way, I appreciate the fact that you've substantially increased your ownership even beyond what's listed in our proxy statement. So thank you.
Joseph Harary: Your question was, are you seeing any effects of the U.S. trade tariff policy on your business? Are there any changes in strategy because of this? And I think, you know, we went into some detail last conference call about how the premium market is not really affected. So Ferrari is not really affected by this. Rolls-Royce today got some sort of relief from the U.S. on tariffs. I think Trump made the point that you're probably not going to build a Rolls-Royce factory here in the United States, so we'll give you a break. But for the most part, you know, volume manufacturers are going to deal with the tariff situation.
Speaker Change: Your question was are you seeing any effects of the U S trade tariff policy on your business are there any changes in strategy because of this and I think you know.
Speaker Change: We went into some detail last conference call about how the premium market is not really affected so Ferrari is not really affected by by this rolls Royce today got a some sort of relief from the U S on tariffs.
Speaker Change: I think Trump made the point that you're probably not going to build a rolls Royce factory here in the United States. So we will give you a break but for the most part unit volume manufacturers are going to.
Speaker Change: Deal with the tariff situation and it looks like they're all negotiating.
Joseph Harary: And it looks like they're all negotiating, you know, for, you know, reasonable trade deals. It hasn't really affected us. And I think more specifically, if you look at the announcement that Gowzy made in April. They said that it hasn't affected them either. And it's because we all have worldwide footprints. It's not like, you know, we're really isolated and only exporters are only importers of product. We have a presence all over the world and that's been helpful, especially in a world of tariffs.
Speaker Change: You know for you know reasonable trade deals it hasn't really affected us and I think more specifically if you look at the announcement that <unk> made in April.
Speaker Change: They said that it hasn't affected them either and it's because we all have worldwide footprint, it's not like we're really.
Speaker Change: Isolated in only Exporters' are only importers of product, we we have a presence all over the world and that's and that's been helpful, especially in a world of tariffs.
Speaker Change: Yeah.
Speaker Change: Yeah.
Leonard Litzau: Our next question comes from Leonard Litzau, please say your question. Hey, Joe. I have a question. When you mentioned that, you know, one of the areas would be the display areas, and I know you've been working with LG and all of that sort of thing. And I'm just wondering, is there anything that is going to come soon in that area.
Speaker Change: Our next question comes from Zoe Please state your.
Speaker Change: Yeah.
Speaker Change: Hey, Jim.
Speaker Change: New and.
Speaker Change: Question when you you mentioned that.
Speaker Change: One of the areas like need to display.
Speaker Change: And I know you've been working with LG and all of that sort of thing and I'm. Just wondering is there anything that is.
Speaker Change: Got it comes soon in that area.
Speaker Change: Yeah.
Joseph Harary: Well, you know, I guess the best way to answer that without directly answering your question, because I don't want to speak for LG or for the customers of their product, but there's been a lot of public visibility, especially in the area of train windows. In terms of embedding OLED displays inside of Windows. You know, and I think if you just look in general at what's been happening, even let's just take the Cadillac sunroof, it's a four quadrant sunroof and it has all sorts of things embedded in there besides SPD, such as LED lighting and other things.
Speaker Change: Well I guess, the best way to answer that without directly answering your question because I don't want to speak for LG or or for the customers of their product but.
Speaker Change: There's been a lot of public visibility, especially in the area of a train windows.
Speaker Change: In terms of embedding our OLED displays inside of a.
Speaker Change: Windows.
Speaker Change: And.
And I think if you just look in general at what's been happening, even let's just take the Cadillac Sun roof. It's a four quadrant sunroof and it has all sorts of things embedded in there. Besides S. P D such as led lighting and other things. So the glass itself is becoming more fun and functional.
Joseph Harary: So, the glass itself is becoming more functional as part of the car and I think you'll continue to see that trend with OLEDs combined with SPDs so that you can get really good displays and good information projected, well not projected, presented on glass surfaces. and that extends to things like heads-up displays too.
Speaker Change: As part of the car and I think Youll continue to see that trend with OLED come you know combined with SPD. So that you can get really good displays and good information projected while not projected presented on on glass surfaces.
Speaker Change: And that's things like heads up heads up displays too.
Joseph Harary: Okay, thank you for that.
Speaker Change: Okay. Thank you for that I also noticed in heavy equipment.
Joseph Harary: I also noticed that in heavy equipment, you know, it's being used in in the windscreens and that.
Speaker Change: It's being used in the wind screens and that is that a trend that.
Joseph Harary: Is that a trend that means visors are not going to be needed inside most cars? Yes, you're beginning to see things happen in that shade band above the AS line on your windshield and you mentioned also heavy equipment. A lot of construction equipment has a lot of glass and they become ovens and you can't schlep around huge air conditioners in your harvester or whatever, so being able to control the heat coming in with the glass doing the work becomes very significant. See, I expect these trends to continue. And, you know, Gauzy's subsidiary, Vision Systems, has always been on the forefront of that market with specialty equipment uses for SPD as well as the bread and butter aircraft and boats and things like that, and airplanes.
Speaker Change: Means advisers are not going to be needed inside.
Speaker Change: Most cars.
Speaker Change: AH Yes, you you know you're beginning to see things.
Speaker Change: Things happen in that shade band above the Epsilon on your windshield and you mentioned also heavy equipment you know a lot of.
Speaker Change: Struction equipment has a lot of glass and they become ovens and you can't slip around huge air conditioners. In your you know your harvester or whatever so being able to control the heat coming in.
Speaker Change: You know with with the glass doing the work becomes very significant.
Speaker Change: See I expect these trends to continue in <unk> and <unk> subsidiary vision systems has always been on the forefront of that market with specialty specialty equipment uses for S. P. D. As well as you know the bread and butter aircraft and boats and things like that and airplanes yeah.
Joseph Harary: So we're very close to profitability now, so we'll probably cross over that by the end of the year. If we stay on the track that I expect, we can have a very good year.
Speaker Change: Yes.
Speaker Change: So we're very close to profitability now so we'll probably cross over that by the end of the year.
Speaker Change: If we stay on the track that I expect we can have a very good year.
Joseph Harary: So, bless you, and I hope we get. Okay, thank you.
Speaker Change: Oh, I see you and I hope we get there.
Lynne: Okay. Thank you Lynne.
Jeff Harvey: Our next question comes from Jeff Harvey. Please state your question. Hi, Joe. I got a couple of accounting. questions. Under current assets, you've got relatively receivable net of a million two reserves. What are the reserves? Our reserves are for once something goes over a certain level of time, we put a reserve in there and some of that is very old. And some of it is also on receivables, just timing, you know, at the end of the quarter, you know, especially as our sales have ramped up at the end of the quarter, money is due. The licensee doesn't necessarily get invoiced or pay it until, you know, a short period of time after that.
Speaker Change: Our next question comes from Jeff Harvey Please state your question.
Speaker Change: Hi, Joe.
Speaker Change: Hey, Jeff.
Speaker Change: Questions under your current assets you've got.
Speaker Change: Receivables net about man to reserves what are the reserves for.
Speaker Change: Our reserves are for once something goes over a certain level of clarity of time, we put a reserve in there and some of that is very old and some of it is also on receivables just timing at the end of the quarter.
Speaker Change: Especially as our sales have ramped up at the end of the quarter money as do the licensee doesn't necessarily get invoiced or pay it until you know a short period of time after that so you're going to see at the end of every quarter and that's going to become an ever larger number as revenues grow you know something thats in transit.
Jeff Harvey: So you're going to see at the end of every quarter, and that's going to become an ever larger number as revenues grow, you know, something that's in transit.
Jeff Harvey: Well then under cash flows, you've got a relative receivables of a negative $310,000. that. Yeah, that does it. Say that again. I said under a cash flow from operating activities, you have royalty receivables of a negative $310,000. Yeah, that basically you would you would put add that back in. to add that back in.
Speaker Change: Well then on your cash flow you've got.
Speaker Change: Receivables at a negative 310.
Speaker Change: But yeah that does it.
Speaker Change: Say that again.
Speaker Change: Under our cash flow from operating activities, you have royalty receivables of a negative 310000.
Speaker Change: Yeah that was that basically you would you would put that back in.
Speaker Change: I'd add that backend, okay, alright got it.
Jeff Harvey: Now, Gaussi, sometime last year, in fact, you and I had talked about this, had announced that they were talking about 50,000 cars a year. What's happened to that? Is that still on track? That 50,000 car per year was not an SPD project. As far as I know, it's still on. No, they have things that are much larger than that for SPD that are on track, though. But I'm not allowed to talk about that. Sorry. No, I understand.
Speaker Change: Some time last year.
Speaker Change: Ted.
Speaker Change: They were talking about.
Speaker Change: 50000 cars a year.
Speaker Change: What's happened to that.
Speaker Change: All on track that that that that 50000 car per year was not an S. P D project.
Speaker Change: Far as I know its still on now they have things that are much larger than that for S. P. D that are on track though.
Speaker Change: But I'm not allowed to talk I'm not allowed to talk about that sorry.
Jeff Harvey: You're still on track for the new Asian car model that you talked about? Yeah. As I said earlier, we've mentioned in the past an Asian project, a couple European projects, and a U.S. project, and they're all on track. And then since then, we've added another European one. So between the early March call and the early May call, we've actually added another project in Europe.
Speaker Change: You are still on track for the New Asian.
Speaker Change: Yeah.
Speaker Change: Yeah as I said earlier, we had.
Speaker Change: We've mentioned in the past and Asian project couple of European projects in the U S project and they're all on track and then since then we've added another European one so between the March early March call and the early May call. We've we've actually added another project in Europe.
Jeff Harvey: Yeah, and you brought up a good point today, and I hadn't thought about it, but companies like Caterpillar and Deere make a lot of equipment where the guy is going to pry and I would think that would be a really good market for this. I hope Gauzy or somebody.
Speaker Change: Yeah, and you brought up a good point today.
Speaker Change: But companies like Caterpillar and Deere make a lot of equipment, where the guy who's going to try and size I would think yes, it would be in a.
Speaker Change: Really good market for this I hope golly.
Speaker Change: Or somebody I mean, do you have any other company that helps you market this stuff to companies like that.
Jeff Harvey: I mean, do you have any other company that helps you market this stuff to companies like that? Sure. Every one of our licensees is marketing their products through their sales and distribution network. Amgadzi happens to have a very large footprint in all the major areas of the world. But they bought Vision Systems, and Vision Systems was doing that work for the specialty equipment market quite successfully. So things like container handlers at ports and things like that also use a lot of glass. They're huge cranes, you know, you've seen them on a daily drive by a port.
Speaker Change: Sure every one of our licensees is marketing their products through their sales and distribution network.
Speaker Change: Ghazi happens to have a very large footprint in all the major areas of the world.
Speaker Change: But they you know they bought vision systems and vision systems was doing that work for the specialty equipment market quite successfully so you know things like you know container handlers at ports and things like that also use a lot of lot of glass you know they're huge trains.
Speaker Change: You got to drive by airport.
Jeff Harvey: Is there anything in the works where potentially one of these companies is going to adopt SPD for this? of short. Okay, because it makes a lot of sense to like any of the track does. It does. Yeah, it does. Yeah. And those are things where you know, they're you, they're workhorses. So you can't sit there and, you know, put a huge air conditioner in there and take up all your cabin space. So that's where the glass becomes important.
Speaker Change: Anything in the works for a potential one of these companies one of them adopt SPD for the for this.
Speaker Change: Sure sure Okay.
Speaker Change: Because it makes a lot of sense.
Speaker Change: Any of that it does it does it does it does it yeah and those are things, where you know there you. There workhorses. So you can't sit there and you know put a huge air conditioner in there and take up all your cabin space. So that's that's where the glass becomes important.
Jeff Harvey: Okay, thank you very much.
Speaker Change: Okay. Thank you very much.
Thank you Jeff.
Mike Kay: Our next question comes from Mike Kay. Please state your question. Hello. Hi, Professor. How are you? Oh, or it could be better.
Speaker Change: Our next question comes from Mike. Please state your question.
Speaker Change: Hello.
Speaker Change: Hi, Professor however.
Speaker Change: How are you.
Speaker Change: Oh boy it could be.
Mike Kay: You know, I just want to comment on something you said regarding... I've read all of the Gowsey interviews. Even if research, even if SBD is used... of the Galaxy Project. It's buried deep inside, and if you want to make the investment community aware of Research Front... I respectfully submit that you cannot rely on gout. They have their own agenda, and in their press release... You ask most people, they wouldn't know it, but research that... is, you know, connected to SPD and has all these applications. even the fact that the company has no debt and is, uh, seems to be on the cusp of being property.
Speaker Change: I just wanted to comment on something you said.
Speaker Change: Sure.
Speaker Change: Got it.
Speaker Change: Having people being aware of research frontiers.
Right.
Speaker Change: <unk>.
Speaker Change: Sure.
Speaker Change: Research.
Speaker Change: And one of the.
Speaker Change: Thanks Barry.
Speaker Change: Barry.
Speaker Change: Yes.
Speaker Change: If you wanted to make the investment community aware of research Frontiers I, respectively.
Speaker Change: Thank you cannot rely on.
Speaker Change: Okay.
Speaker Change: Andrew.
Speaker Change: Please.
Speaker Change: If you ask most people.
Speaker Change: No.
Speaker Change: Okay.
Speaker Change: Interiors is.
Speaker Change: Connected to.
Speaker Change: SPD has all these applications.
Speaker Change: Yeah.
Speaker Change: Given the fact that the company has no debt.
Speaker Change: It seems to be on the customer.
Mike Kay: to hire a decent investor relations company to make its story known. Gowsey has, you know, a lot of other things to do than to try and, you know, publicize.
Speaker Change: Yeah, Hi.
Speaker Change: Investor Relations company to make it known to the investment community.
Speaker Change: He has.
Speaker Change: Those are things to do that.
Speaker Change: Yeah.
Speaker Change: On the size of research frontiers.
Mike Kay: Okay, also, I'm not clear, Joe, and I know you could elucidate. I was, and I follow this quite closely regarding tariffs, that, you know, when the tariffs go through. You know, going to make the, if you have a, you know. Arts of Cause, or Cause themselves, that it's going... and the New York Times. Thank you. Product, whatever the product. And now if you want people to add SPD to it, that, of course, will be an additional cost. Am I correct in your saying that, um, that Tyrone... So we'll not have... effect on the on the unsale.
Speaker Change: Okay.
Joe.
Speaker Change: Good day.
Speaker Change: Sure.
Speaker Change: Quite closely with caris.
Speaker Change: Yes.
Speaker Change: No.
Speaker Change: It's going to make.
Speaker Change: Okay.
Speaker Change: Cause.
Speaker Change: Got it.
Speaker Change: The significantly increased.
Speaker Change: Yes.
Speaker Change: Do you want.
Speaker Change: SPD.
Speaker Change: That of course will be an additional cost.
Speaker Change: Am I correct.
Speaker Change: Yes.
Speaker Change: Tariffs.
Speaker Change: Well not have any significant.
Speaker Change: Okay.
Speaker Change: Sales at various times.
Speaker Change: Right.
Joseph Harary: What I said last time on the conference call is that typically, if you're talking about a price sensitive market, like mid-level cars or below, it might have some impact. But I don't expect that to have any practical impact on our revenue in that market. And also, these Asian cars are sold in their home market primarily, so it's not like they're affected by U.S. tariffs. In the premium market, take the Ferraris and the Cadillacs. It doesn't make a difference. People are going to buy them and it's not going to matter. I think Ferrari announced a 10 percent price increase.
Speaker Change: Yeah, what I said last time on the conference call is that typically if you're talking about a price sensitive market like you know mid mid level cars or below it might have some impact, but I don't expect that to have any practical impact on our revenue.
Speaker Change: In that market.
Speaker Change: And also and also and also these Asian cars are sold in their home market, primarily so it's not like they're going to be affected by U S tariffs and the premium market take the Ferrari is in the Cadillacs.
Speaker Change: It doesn't make a difference people people are going to buy them and it's not going to matter you know I think Ferrari announced a 10% price increase I don't think anybody canceled an order because of that.
Joseph Harary: I don't think anybody canceled an order because of that. The other thing is just to understand that because we have a worldwide footprint, that also helps too. If you look at how some of these trade deals are going, Michael, you look at U.S. content of cars, for example, and they've gotten some relief. Well, we're considered a U.S. content component of a car. Right, yeah, that's right, because... Well, because we're here, Gowsey is here, and all the glass companies have facilities here. So it's not like, you know, it's not as dramatic as some of the things where you have to build, you know, a $500 billion chip factory in the United States.
Speaker Change: So I think that and then the other thing is just understand that that because we have a worldwide footprint.
Speaker Change: That also helps too.
Speaker Change: If you look at how some of these trade deals are going Michael you know you look at content U S content of cars for example, and they've gotten some relief well you know we were considered a U S content, you know component of a car.
Speaker Change: Right.
Speaker Change: It was.
Speaker Change: Well, because because where we're where we're here gals. He is here and all the glass companies have.
Speaker Change: Facilities here. So it's not like you know, it's not as dramatic as some of the things where you have to build you know a $500 billion you know chip factory in the United States.
Joseph Harary: That production's already here. the and the people. enough money to buy a Rolls-Royce or a Ferrari? House and more.
Speaker Change: That production is already here.
Speaker Change: Yeah.
Speaker Change: Have enough money to buy it.
Speaker Change: Sure.
Speaker Change: These premium.
Speaker Change: How is it more.
Speaker Change: Susan.
Joseph Harary: But I really what I really had in mind and UN said this is really what Revenues are going to come. You know, low price or mid-range types of oil. That's where the volumes are coming from. I'm not saying that's where our, you know, profits are. And certainly within the time horizon that I'm looking at for this, it's not going to impact them.
Speaker Change: You want to say this is really weird.
Speaker Change: Revenues.
Speaker Change: I'm from would be from the.
Speaker Change: No.
Speaker Change: Mid range type of automobiles.
Speaker Change: Especially.
Speaker Change: Well, that's where the where that's where the volumes are coming from I'm, not saying, that's where R. R.
Speaker Change: and certainly within the time horizon that I'm looking at for this, it's not going to impact things.
Speaker Change: And are the Sunvises? What's the status of that? When will that be available? Well, I'm not going to pre-announce what it...
Joseph Harary: Well, I'm not going to pre-announce what it will be. Customers Are Doing. So I think you just have to wait on that.
Customers are doing.
Joseph Harary: Some of them will be built into the car and some will be aftermarket items. Michael, I think in the interest of time we need to move on because there's other people in the queue with questions. But we could talk offline. We could talk offline. Thank you.
Speaker Change: So I think you just have to wait on that. Some of them will be built into the car and some will be aftermarket items.
Speaker Change: I think Michael, I think we, in the interest of time, we need to move on because, yeah.
There's other people in the queue with questions.
Speaker Change: But we can talk offline. We can talk offline. Okay, thank you.
Todd Brady: Our next question comes from Todd Brady. Please state your question. Hi, Joe.
Thank you.
Speaker Change: Our next question comes from Todd Brady. Please say your question.
Todd Brady: Art Brady here. There's some kind of a trend going on where you have text, but a lot of the manufacturers and display people, they now want to have that text converted to speech. So you have text and speech combined. Do you see any of that developing? And can you expand on it?
I go, Art Brady here.
Speaker Change: There's some kind of a trend going on where you have text, but a lot of the manufacturers and display people, they now want to have that text converted to speech.
Speaker Change: So you have text and speech combined. Do you see any of that developing and can you expand on it?
Joseph Harary: Well, not directly with SPD, but my windows in my office here in Woodbury, I could talk to and, you know, and tell them to clear up or darken and they do. So, you know, voice control is something very, you know, I think very important, especially for safety and driving. So there's been a lot of work done there. But yeah, it's pretty easy for us to and you know, whatever, whatever is developed, there are would work with us. Okay, thank you. Once again, if you would like to ask a question, please press star 1 on your phone.
Speaker Change: Well, that's directly with SPD, but my windows in my office here in Woodbury, I could talk to and...
Speaker Change: You know, and tell them to clear up or darken and they do. So, you know, voice control is something very, you know, I think very important especially for safety and driving. So, there's been a lot of work done there. But yeah, it's pretty easy for us to, you know, whatever whatever is developed there or would work with us.
Okay, thank you.
Thanks.
Speaker Change: Once again, if you would like to have a question, please press star one on your phone now. We have follow-up question from Francis, Could Turbo, please say your question.
Francis Coturbo: We have follow-up questions from Frances Coturbo.
Francis Coturbo: One last question, are there any prospects of anyone else manufacturing the emulsions in film other than Gaussi?
Speaker Change: I don't get, Joe. Well, one last question. Are there any prospects of anyone else manufacturing the emotions in film other than Gaussian?
Joseph Harary: I'd rather not comment on Open Call. We always get interest from companies that want to expand into SPD and that's a bigger strategy. Right now, we're very happy with the investment that Galsy has made in terms of expanding production worldwide. They significantly invested in the SPD facility in Germany and in establishing sales and marketing arms throughout the world and then increasing emulsion production both in Israel and in other areas of the world. They're doing exactly what a good partner they are for us would do and that's expanding and thinking long-term and cooperating and collaborating.
Speaker Change: I'd rather not comment an open call. We always get interest from companies that want to expand into SPD, and that's a bigger strategy.
Right now, we're very happy with-
Speaker Change: The investment that Yalzi has made in terms of expanding production worldwide.
You know, they should never again Lee.
in establishing sales and marketing arms throughout the world.
Speaker Change: and then increasing the mulch and production both in Israel and in other areas of the world, so...
Speaker Change: You know, they're doing exactly what a good partner, you know, they are for us would do and that's expanding and, you know, thinking long-term and cooperating and collaborating.
Joseph Harary: But the plant in Stuttgart, they only... They're only capable of making... 7800. 1,000 square meters of film. They built in redundancy there, so they could actually have a line right next to the one that's there and double the capacity.
But the plant in Stuttgart, they're all in...
Fairly capable of making...
Seven-one-one . . .
Thousand square meters of film.
Speaker Change: with their current line. Well, they built in redundancy there, so they could actually add a line right next to the one that's there in double the capacity. But my guess, Frank, is that
Joseph Harary: My guess, Frank, is that they are going to locate the next filmmaking plant somewhere else in the world that's closer to the major customer. Stuttgart is near a lot of obvious premium car makers, but there's a lot of business in other areas of the world, too, North America and in Asia, where they may also locate it. I don't think anyone's going to locate it in China, but both for… Well, for intellectual property reasons, but also for other reasons as well.
They are going to...
Speaker Change: Locate the next filmmaker and plant somewhere else in the world that's closer to the major customer.
So, you know, Stuttgart is near, a lot of obvious things.
Francis Coturbo: Okay, thanks.
Okay, thanks.
Charles Michaels: Our next question comes from Charles Michaels. Please say your question. Yes. Hi, Joe. Hey, Chuck. I wanted to ask about, you mentioned the dynamic class. But there really hasn't been much discussion about, like, office windows and what progress are we making on those sorts of products. That's a great question. So I think a very significant development in the SPD office window market is coming from the retrofit. And I mentioned that we expect the second half of the year to be much more visible there. If you think about an office, let's say you have an office and you want to make it smart.
Thank you.
Speaker Change: Our next question comes from Charles Michaels, please say your question.
Yes, hi, Joe.
Speaker Change: Yeah, I wanted to ask about, you mentioned the Dynamic Class Act, but there really hasn't been much discussion about like office windows and what progress are we making on those sorts of stuff.
blah blah
That's a great question.
I think a very significant...
Speaker Change: Development in the SPD office window market is coming from the retrofit. And I mentioned that we expect a second half of the year to be much more visible there. If you think about an office, let's say you have an office and you want to make it smart. Well,
Joseph Harary: Well, if You're, you know, doing a traditional installation, you got to get landlord approval. You've got to get permits, you've got to build scaffolding underneath if you're anywhere above the first floor so that, you know, debris and glass and things don't fall on people that are walking by there. And it's very disruptive. You may have to move out of certain areas of your office while that kind of work is being done.
If...
Speaker Change: You're, you know, doing a traditional installation. You've got to get landlord approval.
You got to get permits.
Speaker Change: You got to build scaffolding underneath if you're anywhere above the first floor so that...
Harary Goulding.
Joseph Harary: Now let's flash forward to a world where there's a retrofit from the inside of the building. You don't need scaffolds. It's more like a Venetian blind or a shade where you don't need approvals, right? And you could come in over the weekend and, you know, we've discussed the, you know, capacity to do this and it's quite doable and, you know, retrofit floors at a time without disrupting anyone's work. So we're very excited about that because it minimizes tenant disruption or occupant disruption and it minimizes cost. Yeah, I think you, you know, you make a good case for it.
Speaker Change: You don't need scaffolds. It's more like a Venetian bliner or a shade where you don't need approvals.
Speaker Change: Right? And you could come in over the weekend and we've discussed the capacity to do this and it's quite doable and you know retrofit floors at a time without disrupting anyone's [inaudible]
Speaker Change: Work. So we're very excited about that because it minimizes tenant disruption or occupant disruption and it minimizes cost.
Joseph Harary: But I'm just wondering, you know, what about what's been the result in terms of purchase. So we have projects underway, we have projects underway even without the retrofit application being finalized. And then we have the retrofit coming, so the progress is there are architectural installations plus there's, you know, I think what I consider a game changer, which is the ability to retrofit an existing window into a SPD smart window. It's not something other people can do either, so it's... I think it's very meaningful in terms of competitive advantage that not only do we have the best performing technology, but I think we have the best delivery system for that to get it more easily into your home or office.
Speaker Change: Yeah, I think you, you know, you make a good case for it, but I'm just wondering, you know, what about, you know, what's been the result in terms of
purchases.
Speaker Change: So we have projects underway. We have projects underway even without the retrofit application being finalized.
Speaker Change: and then we have the retrofit coming. So the progress is there are architectural installations, plus there's
Speaker Change: You know, I think what I consider a game changer, which is the ability to retrofit an existing window into a SPD smart window. It's not something other people can do either, so it's...
Speaker Change: I think it's very meaningful in terms of competitive advantage that not only do we have the best performing technology but I think we have the best delivery system for that to get it more easily into your home or office.
Joseph Harary: So, so who has, I'm not clear, who has to approve of this for us to be able to do these retrofitting? Well, the customer has to want it. So just like any buying decision, it's the customer. But, you know, there's product development that goes into it that we're doing. And there's, you know, data generation, you know, for the architects, so they know that if they retrofit a building, what are the expected benefits likely to be? and all that stinky condom.
Speaker Change: So who has, I'm not clear, who has to approve of this for us to be able to do these retrofits?
Speaker Change: Well, the customer has to want it, so just like any buying decision, it's the customer. But there's product development that goes into it that we're doing, and there's data generation for the architects, so they know that if they retrofit a building, what are the expected benefits like would it be?
Operator: Thanks a lot. Thank you. Bye-bye. Once again, to ask a question, please press star 1 on your.
I think all that's being worked on now.
Okay. Thank you.
Operator: At this time, we have no further questions.
Joseph Harary: I'll turn it back over to your host for some closing. Okay, thank you. So if you believe in smart glass done right. stick with us and our licensees. They've already accomplished more with SPD than any other smart glass company in the world, and they have far more on the pipeline than ever before. As a company, quarter after quarter and year after year, we've steadily grown revenue, streamlined operations, and advanced our technology. The reasons for these positive results are easy to understand. We have a highly desirable and the best performing smart glass technology in the world.
Speaker Change: At this time, we have no further questions. I'll turn it back over to your host for some closing remarks.
So, if you believe in smart glass done right...
Speaker Change: Stick with us in our licensees. They've already accomplished more with SPD than any other smart glass company in the world. And they have far more on the pipeline than ever before.
Speaker Change: As a company quarter after quarter and year after year we've steadily grown revenue, streamlined operations and advanced art technology.
The reasons for these pods of results are easy to understand.
Speaker Change: We have a highly desirable and the best performing smart glass technology in the world.
Joseph Harary: By increasing revenues, managing our expenses, and preserving the best aspects of our asset-light business model, we're steadily moving towards being cash flow positive and profitable. Our Q1 2025 results demonstrates this trajectory. Royalty revenue is up over 79%. 214% if you are comparing us to the fourth quarter sequentially, and it's primarily driven by higher royalties in the automotive market. And this growth builds on our successful integrations of SPD smart class and vehicles from Ferrari, McLaren, Mercedes, and Cadillac. Mercedes' debut of their luxury van this past month also shows that SPD's smart glass and automotive is not just for sunroofs, but also has meaningful benefits in other areas of the car, such as side windows.
Speaker Change: By increasing revenues, managing our expenses and preserving the best aspects of our asset light business model, we're steadily moving towards being cash flow positive and profitable.
Speaker Change: RQ-1 2025 results demonstrates this trajectory. Royalty revenues up over 79 percent.
Speaker Change: and it's primarily driven by high royalties in the automotive market.
Speaker Change: and this growth builds on our successful integrations of SPD Smart Class and vehicles from Ferrari, McLaren, Mercedes, and Cadillac.
Speaker Change: Mercedes debut of their luxury van this past month also shows that SPD Smart Glass and Automotive is not just for sunroose, but also has meaningful benefits in other areas of the car, such as side
Joseph Harary: There are also other unannounced projects in automotive out there that will also show the... And we expect revenues in all market segments to increase further as new products are introduced. We are excited about and continue to see significant potential in the architectural market, especially with the anticipated launch of the Retrofit application. Regulatory support, such as the Dynamic Glass Act, which offers substantial tax credits, should further encourage the adoption of RSPD Smart Glass in buildings. Our relationship with Galsy, our licensing and strategic investor, remains very strong. We work very closely with them hand-in-hand on a daily or weekly basis on various projects throughout the world, sharing information and ideas in business development.
Speaker Change: There are also other unannounced projects in automotive out there that will also show this.
Speaker Change: And we expect revenues in all market segments to increase further as new products are introduced.
Speaker Change: We're excited about and continue to see significant potential in the architectural market, especially with the anticipated launch of the retrofit application.
Speaker Change: Regulatory support, such as the Dynamic Glass Act, which offers substantial tax credits, should further encourage the adoption of our SPD Smart Glass and Buildings.
Speaker Change: Our relationship with Galzie, our licensee and strategic investor, remains very strong.
Speaker Change: We work very closely with them hand in hand on a daily or weekly basis on various projects throughout the world sharing information and ideas in business development.
Joseph Harary: Their SVD film sales are a very good leading indicator of our royalties, and their recent IPO this past June has brought greater transparency and resources to the industry, which should greatly benefit our entire SVD smart glass industry. Research Frontiers and our shareholders. also will benefit from that. And together, we are reinforcing the market position of SVD smart glass as the premier smart glass technology and further expanding our footprint and capacity throughout the world.
Speaker Change: Their SVD filmcells are a very good leading indicator of our royalties and the recent IPO this past June has brought greater transparency and resources to the industry, which should greatly benefit our entire SVD smart-glass industry.
Frontiers and our shareholders.
also will benefit from that.
Speaker Change: And together, we are reinforcing the market position of SMART Glass as the premier SMART Glass technology, and further expanding our footprint and capacity throughout the world. And I look forward to listening to their investor conference call this coming Tuesday morning.
Joseph Harary: And I look forward to listening to their investor conference call this coming Tuesday morning. Financially, we remain debt-free with low and predictable expenses and are approaching break-even in profitability. Our strong cash position projected to fund operations for more than the next five years and no debt means we are in a position of strength and do not need to raise additional capital at this time. The outlook for the smart glass industry remains extremely promising, and we stand at the forefront leading this industry, driven by our superior technology, increasing demand and regulatory support, and continuous innovative breakthroughs.
Speaker Change: Financially, we remain debt-free with low and predictable expenses and are approaching break-even and profitability.
Speaker Change: Our strong cash position projected to fund operations from more than the next five years, and no debt means we are in a position of strength and do not need to raise additional capital at this time.
Speaker Change: The outlook for the smart less industry remains extremely promising and we stand at the forefront, leading this industry driven by our superior technology, increasing demand and regulatory support and continuous innovative breakthroughs.
Joseph Harary: We're not just advancing the state of smart glass. We're shaping the future of how people experience what they see and feel through that ubiquitous material, glass. This coming year, based on the momentum and catalysts we see, we expect you to see even better results. We remain intently focused on execution, innovation, and driving significant shareholder value.
We're not just advancing the state of smart glass.
Speaker Change: We're shaping the future of how people experience what they see and feel through that ubiquitous material, glass.
Speaker Change: This coming year, based on the momentum and catalyst we see, we expect you to see even better results.
Speaker Change: We remain intently focused on execution, innovation, and driving significant shareholder value.
Joseph Harary: Your support, dedication, and belief in our vision have been instrumental in our success, and we appreciate your trust and support in this exciting and important journey together.
Speaker Change: Your support, dedication, and belief in our vision have been instrumental in our success, and we appreciate your trust and support in this exciting and important journey together. Thank you, and please remember to vote at our annual meeting coming up on June 12th. Thank you all.
Joseph Harary: Thank you, and please remember to vote at our annual meeting coming up on June 12th. Thank you all.
Operator: This concludes today's conference call. Thank you for...
[inaudible]
Operator: The host has ended this call.
Speaker Change: The House has ended this call goodbye.
Operator: Goodbye.