Full Year 2025 Gorilla Technology Group Inc Earnings Call

March 2, 2026

Kristen: We're standing by. This is the conference operator. Welcome to the Gorilla Technology Group Inc. Fiscal Year 2025 Financial Results Conference Call. As a reminder, all participants are in a listen-only mode, the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then one on your telephone keypad. Should you need assistance during the call, you may signal an operator by pressing star and zero. Before we begin, we will read the forward-looking statement. Today's call includes forward-looking statements made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. These statements reflect management's current expectations and projections about future events and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially.

Operator: This is the conference operator. Welcome to the Gorilla Technology Group Inc. Fiscal Year 2025 Financial Results Conference Call. As a reminder, all participants are in a listen-only mode, the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then one on your telephone keypad. Should you need assistance during the call, you may signal an operator by pressing star and zero. Before we begin, we will read the forward-looking statement. Today's call includes forward-looking statements made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. These statements reflect management's current expectations and projections about future events and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially.

Speaker #2: As a reminder, all participants are in a listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions.

Speaker #2: To join the question queue, you may press star, then one on your telephone keypad. Should you need assistance during the call, you may signal an operator by pressing star and zero.

Speaker #2: Before we begin, we will read the forward-looking statement. Today's call includes forward-looking statements made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995.

Speaker #2: These statements reflect management's current expectations and projections about future events and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially.

Speaker #2: Forward-looking statements often include terms such as 'expects,' 'believes,' 'plans,' 'anticipates,' 'may,' 'should,' and similar expressions. For a discussion of important factors that could affect Gorilla's results, please refer to our filings with the SEC.

Kristen: Forward-looking statements often include terms such as expects, believes, plans, anticipates, may, should, and similar expressions. For a discussion of important factors that could affect Gorilla's results, please refer to our filings with the SEC, including our most recent annual report on Form 20-F. Except as required by law, Gorilla undertakes no obligation to update or revise any forward-looking statements made on this call, whether as a result of new information, future events, or otherwise. I would now like to turn the conference over to Jay Chandan, Chairman and Chief Executive Officer, and Bruce Bower, Chief Financial Officer. Please go ahead.

Operator: Forward-looking statements often include terms such as expects, believes, plans, anticipates, may, should, and similar expressions. For a discussion of important factors that could affect Gorilla's results, please refer to our filings with the SEC, including our most recent annual report on Form 20-F. Except as required by law, Gorilla undertakes no obligation to update or revise any forward-looking statements made on this call, whether as a result of new information, future events, or otherwise. I would now like to turn the conference over to Jay Chandan, Chairman and Chief Executive Officer, and Bruce Bower, Chief Financial Officer. Please go ahead.

Speaker #2: Including our most recent annual report on Form 20-F, except as required by law, Gorilla undertakes no obligation to update or revise any forward-looking statements made on this call, whether as a result of new information, future events, or otherwise.

Speaker #2: I would now like to turn the conference over to Jay Chandan, Chairman and Chief Executive Officer and Bruce Power, Chief Financial Officer. Please go ahead.

Speaker #2: Thank you very much, Kristen. Thanks, everyone. And thanks for joining. I will keep it crisp. If you want drama, the market's already provided enough already today, so I will stick to the facts.

Jay Chandan: Thank you very much, Kristen. Thanks, everyone, and thanks for joining. I will keep it crisp. If you want drama, the market's already provided enough already today, so I will stick to the facts. Now, let me start with the headline. We reported a record full-year revenue of $101.4 million, up 35.7% year-over-year. This is the first time in our history we have crossed $100 million annualized revenue. We guided the market $100 million to $110 million, and we delivered inside that range. That matters because credibility matters, and we intend to keep it that way. Now, the most important part is how we got here. We executed a real turnaround. IFRS operating loss narrowed to about $13.7 million from $66.9 million last year.

Speaker #2: Now, let me start with the headline. We reported a record full-year revenue of 101.4 million up 35.7% year on year. This is the first time in our history we have crossed 100 million annualized revenue.

Speaker #2: We guided the market to $100 million to $110 million, and we delivered inside that range. That matters. Because credibility matters. And we intend to keep it that way.

Speaker #2: Now, the more important part is how we got here. We executed a real turnaround. Our IFRS operating loss narrowed to about $13.7 million from $66.9 million last year.

Speaker #2: That was a remarkable improvement of 53.2 million or 79.6% reduction in the IFRS operating loss. Now, our IFRS net loss narrowed to about 11.3 million from 64.8 million last year.

Jay Chandan: That was a remarkable improvement of $53.2 million or 79.6% reduction in the IFRS operating loss. Now, our IFRS net loss narrowed to about $11.3 million from $64.8 million last year, an 82.6% improvement. IFRS basic EPS improved to about 0.51 from -6.13, which is a 91.7% improvement. Yes, it was a proper swing. It was not just a cosmetic one. We did all of this while keeping the underlying profitability at scale. Adjusted EBITDA came in around $19.1 million, and adjusted net income was about $19.9 million, and with our adjusted basic EPS being 0.89 and an adjusted diluted EPS at 0.88.

Speaker #2: And 82.6% improvement. And IFRS basic EPS improved to about $0.51 from -$6.13, which is a 91.7% improvement. So yes, it was a proper swing.

Speaker #2: It was not just a cosmetic one. We did all of this while keeping the underlying profitability at scale. Adjusted EBITDA came in around 19.1 million, and adjusted net income was about 19.9 million and without adjusted basic EPS being 0.89 and an adjusted diluted EPS at 0.88.

Speaker #2: What I can tell you is that it is strong and it is very disciplined. Now, I know what comes next because investors always ask it, how did we do versus expectations?

Jay Chandan: What I can tell you is that it is strong, and it is very disciplined. Now, I know what comes next because investors always ask it: How did we do versus expectations? For Q4, the market consensus was roughly around $34.75 million of revenue and adjusted EPS of $0.30. Based on our full year results, our Q4 revenue was approximately $35.6 million, which is well above consensus. Based on the implied Q4 adjusted earnings, our adjusted EPS was roughly around $0.37, which is about 23% beat versus the $0.30 consensus. Now for the full year, the market consensus was approximately $100.6 million of revenue with an $0.84 adjusted EPS.

Speaker #2: For the fourth quarter, the market consensus was roughly around 34.75 million of revenue and adjusted EPS of 0.30. Based on our full year results, our fourth quarter revenue was approximately 35.6 million, which is well above consensus.

Speaker #2: And based on the implied fourth quarter adjusted earnings, our adjusted EPS was roughly around $0.37, which was about a 23% beat versus the $0.30 consensus.

Speaker #2: Now, for the full year, the market consensus was approximately $100.6 million of revenue, with a $0.84 adjusted EPS. Now, we delivered roughly around $101.4 million of revenue and delivered about $0.89 adjusted EPS, which is about a 6% beat versus consensus.

Jay Chandan: Now we delivered roughly around $101.4 million of revenue and delivered about $0.89 adjusted EPS, which is about a 6% beat versus consensus. The message from my side is simple: We delivered record revenue. We delivered a major IFRS turnaround. We delivered underlying profitability that exceeded expectations. Now let us talk about the broader market because it has been volatile. The market conversation has shifted from did you beat the quarter to will AI spending hold up? I'm sure all of you have seen this in the last few days and weeks. That is a fair debate, but personally, it misses the bigger picture. AI is no longer a discretionary software trend. It's rapidly becoming a national capability and a core operating layer for enterprises and governments.

Speaker #2: So, the message from my side is simple. We delivered record revenue. We delivered a major IFRS turnaround. We delivered underlying profitability that exceeded expectations.

Speaker #2: Now, let us talk about the broader market because it has been volatile. The market conversation has shifted from, "Did you beat the quarter?" to, "Will AI spending hold up?" And I'm sure all of you have seen this in the last few days and weeks.

Speaker #2: That is a fair debate. But personally, it misses the bigger picture. AI is no longer at discretionary software trend. It's rapidly becoming a national capability.

Speaker #2: And a core operating layer for enterprises and governments. Now, the next phase of AI demand cannot be defined by one buyer or one deal.

Jay Chandan: The next phase of AI demand cannot be defined by one buyer or one deal. It will be defined by many buyers across various sectors building permanent capacity. Governments, regulated enterprises, telecom operators, logistics networks, financial services platform. This list is long and the spend is becoming structural. The compute is also evolving at a rapid pace. This is what the market is really missing. AI compute is actually shifting from training-led cycle to an inference-led cycle. This is important because this does not reduce demand. It broadens demand. Inference pushes AI into everyday workflows and mission-critical operations, which increases the need for distributed compute across regional data centers and edge environments where latency, data residency, and resiliency requirements matter. This is where edge becomes a major driver.

Speaker #2: It would be defined by many buyers across various sectors building permanent capacity. Governments, regulated enterprises, telecom operators, logistics networks, financial services platforms. This list is long and the spend is becoming structural.

Speaker #2: Now, computers are also evolving at a rapid pace. This is what the market is really missing. Now, AI compute is actually shifting from training, let's say, to an inference-led cycle.

Speaker #2: This is important. Because this does not reduce demand. It broadens demand. Inference pushes AI into everyday workflows. And mission-critical operations with increases the need for distributed compute across regional data centers and agent environments where latency data residency and resiliency requirements matter.

Speaker #2: Now, this is where edge becomes a major driver. As most of you know, we were one of the leading edge companies when we went public.

Jay Chandan: As most of you know, we were one of the leading edge companies when we went public. We continue to invest heavily. Edge compute expands, and what AI can do, because it moves inference closer to the decision point, is closer to the sensor, closer to customer interaction, closer to regulated data. It becomes a force multiplier for adoption in public safety, transportation, logistics, financial services, telecom networks, industrial, and the whole plethora of smart cities. Now let us talk about scale of the infrastructure market in our region. We're not kind of relying on slogans. We're tracking the data very, very closely. We have an internal team, we have a research team which is doing that, and we use external data at the same time.

Speaker #2: And we continue to invest heavily. Edge compute expands. And what AI can do, because it moves inference closer to the decision point, is closer to the sensor.

Speaker #2: Closer to the customer interaction. Closer to regulated data. It becomes a force multiplier for adoption in public safety, transportation, logistics, financial services, telecom networks, industrial and the whole plethora of series.

Speaker #2: Now, let us talk about scale. Of the infrastructure market in our region. We're not kind of relying on slogans. We're tracking the data very, very closely.

Speaker #2: We have an internal team. We have a research team which is doing that. And we use external data at the same time. Now, we see Asia-Pacific data center investment growing from roughly 30 billion dollars in mid of 2026, up roughly to about 90 billion dollars by 2030, 31.

Jay Chandan: Now, we see Asia-Pacific data center investment growing from roughly $30 billion in mid-2026, up roughly to about $90 billion by 2030, 2031. We see installed capacity broadly doubling from about 29,000 megawatts today to about 63,000 megawatts by the end of the decade. Now, Southeast Asia also follows the same trajectory, going from the low teens of billions towards roughly $30 billion by 2030, as more capacity is being built in the market rather than exported offshore. India is another example. It's scaling very rapidly. From a little over 1 gigawatt of installed IT load today, they're moving towards about 1.8 gigawatts by 2027 and to multiple gigawatts by 2030. We're seeing the same trend in the Middle East.

Speaker #2: We see installed capacity broadly doubling from about 29,000 megawatts today to about 63,000 megawatts by the end of the decade. Now, Southeast Asia also follows the same trajectory.

Speaker #2: Growing from the low teens of billions towards roughly $30 billion by 2030, as more capacity is being built in the market rather than exported offshore.

Speaker #2: India is another example. It's scaling very rapidly. From a little over 1 gigawatt of installed IT load today, they're moving towards about 1.8 gigawatts by 2027.

Speaker #2: And to multiple gigawatts by 2030. We're seeing the same trend in the Middle East. We're seeing the sovereign build-out dynamic. With market growth from low single-digit billions to a high single-digit billions by early 2030 as governments and national champions scale local compute and secure infrastructure.

Jay Chandan: We're seeing sovereign build-out dynamic, with market growth from low single-digit billions to a high single-digit billions by early 2030 as government and national champions scale local compute and secure infrastructure. This is the structural build cycle we are positioning Gorilla for. What are we doing in 2026? We are advancing our AI infrastructure and data center build strategy well across Malaysia, Thailand, Indonesia, Singapore, and the other regions, including Taiwan and so on. We're expanding our evaluation work in India. We're progressing our strategy in the Middle East, which includes Saudi Arabia, where an MOU has already been signed, and we're very actively exploring data center development opportunities in the region. We're also exploring opportunities to buy and/or build our own data center assets. Ownership changes the model.

Speaker #2: This is the structural build cycle we are positioning Gorilla for. So what are we doing in 2026? We are advancing our AI infrastructure and data center build strategy well across Malaysia, Thailand, Indonesia, Singapore, and the other regions including Taiwan and so on.

Speaker #2: We're expanding our evaluation work in India. We're progressing our strategy in the Middle East, which includes Saudi Arabia. We're an MOU has already been signed.

Speaker #2: And we're very actively exploring data center development opportunities in that region. We're also exploring opportunities to buy and/or build our own data center assets.

Speaker #2: Ownership changes the model. It gives us more control over our delivery, and stronger long-term positioning, and the potential to build recurring, infrastructure-led revenue streams rather than relying on project cycles.

Jay Chandan: It gives us more control over our delivery and stronger long-term positioning and the potential to build recurring infrastructure-led revenue streams rather than relying on project cycles. Now, in parallel, we are also strengthening our product edge for this next phase of adoption. Our post-quantum cryptography SP was targeted to be ready in April 2026, and our lawful interception product suites remain in continued research and development as we expand sovereign-grade capability across security and intelligence, as well as compliance-led deployments. Now, come 2027, we're also now putting a team together which will be investing very heavily into 6G lawful interception as well. Now, we have currently got, what? About 300 full-time employees today, a little over 200 plus contractors working on all the projects we've signed.

Speaker #2: Now, in parallel, we are also strengthening our product edge for this next phase of adoption. Our course quantum cryptography was targeted to be ready in April 2026.

Speaker #2: And our local interception product suites remain in continued research and development as we expand sovereign-grade capability across security and intelligence, as well as compliance-led deployments.

Speaker #2: Now, come 2027, we're also now putting a team together, which would be investing very heavily into 6G local interception as well. Now, we currently have, what, about 300 full-time employees today, a little over 200-plus contractors working on all the projects we've signed.

Speaker #2: But based on just the projects we have recently signed, we anticipate growing to about 1,200 to 1,500 full-time employees by mid-June next year. And that would be about an additional of roughly around 700 to 800 contractors.

Jay Chandan: Based on just the projects we have recently signed, we anticipate growing to about 1,200 to 1,500 full-time employees by mid-June next year, and that would be about an additional of roughly around 700 to 800 contractors. We'll have roughly between 2,000 to 2,500 employees for the company at any given point of time. Investors want proof. They want execution, not a narrative. I will speak directly about the signals that matter: delivery and collections, more importantly, cash conversion. Our top customers are progressing very strongly, and our customer satisfaction is reflected in our payment behavior. Okay? In the first 2 months of 2026, we've collected more than $22 million from our largest customers for solutions delivered and invoiced in 2025. We also expect meaningful collections in the coming weeks.

Speaker #2: So we'll have roughly between 2,000 to 2,500 employees for the company at any given point of time. Now, investors want proof. They want execution, not a narrative.

Speaker #2: So I will speak directly about the signals that matter: delivery and collections, and more importantly, cash conversion. Our top customers are progressing very strongly, and our customer satisfaction is reflected in our payment behavior.

Speaker #2: Okay? In the first two months of 2026, we've collected more than 22 million dollars from our largest customers for solutions delivered and invoiced in 2025.

Speaker #2: We also expect meaningful collections in the coming weeks. Now, we finished the year 2025 with about a total cash of 104.8 million dollars. But what was very important that we did all this by reducing the total debt load to about 13.8 million, which is 35.6% lower from the 21.4 million in the prior year.

Jay Chandan: We finished the year 2025 with about a total cash of $104.8 million. What was very important that we did all this by reducing the total debt load to about $13.8 million, which is 35.6% lower from the $21.4 million in the prior year. Through the refinancing of certain lending agreements and the repayment of others, we also reduced our debt, releasing more than $5.3 million of deposits previously held as collateral against some of these loan obligations. This kind of balance sheet gives us very meaningful flexibility to execute existing programs, fund working capital to delivery cycles, and scale our infrastructure strategy with discipline.

Speaker #2: Now, through the refinancing of certain lending agreements and the repayment of others, we also reduced our debt releasing more than 5.3 million of deposits previously held as collateral against some of these loan obligations.

Speaker #2: Now, this kind of balance sheet gives us very meaningful flexibility to execute existing programs, fund working capital through delivery cycles, and scale our infrastructure strategy with discipline.

Speaker #2: Now, we've also spent at the same time more than $11 million on buybacks today, which we believe the market continues to undervalue Gorilla relative to our performance and our strategy.

Jay Chandan: Now, we've also spent More than $11 million on buybacks to date, which we believe the market continues to undervalue Gorilla relative to our performance and our strategy. You know, personally, I think you could call this confidence. I call it arithmetic, right? Why? That leads me to my next point. We're aiming to be cash flow positive in 2026. That's not just a slogan for me. It's an operating objective that comes with very disciplined delivery, disciplined overhead control, and a very disciplined cash collection. Finally, a lot of people have asked me this question over and over again. Gorilla Technology Capital. Personally, it's a game-changing catalyst for our next phase.

Speaker #2: Personally, I think you could call this confidence. I call it arithmetic. Right? Why? Because that leads me to my next point. We're aiming to be cash depositive in 2026.

Speaker #2: That's not just a slogan for me. It's an operating objective that comes with very disciplined delivery, disciplined overhead control, and a very disciplined cash collection.

Speaker #2: And finally, a lot of people have asked me this question over and over again. Gorilla Technology Capital. Personally, it's a game-changing catalyst for our next phase.

Speaker #2: It's designed to expand our ability to execute larger infrastructure programs by structuring capital-efficiently aligning long-duration funding with long-duration assets as well as enabling our customers to move faster with clear financing pathways.

Jay Chandan: It's designed to expand our ability to execute larger infrastructure programs by structuring capital efficiently, aligning long duration funding with long duration assets, as well as enabling our customers to move faster with clear financing pathways. Some people said, Hey, maybe they're buying the bank. No, we're not buying a bank. I mean, you guys have to understand what Gorilla Technology Capital does, it strengthens our ability to scale data center builds, accelerate GPU infrastructure deployment, and more importantly, participate materially in larger mandates with institutional-grade structures and governance. If I summarize 2025 in one line, we've delivered a historic revenue milestone. We executed a major profitability turnaround. We strengthened the balance sheet and positioned Gorilla for the next phase of AI infrastructure, which is sovereign and regional, more importantly, distributed, which is becoming increasingly edge-enabled.

Speaker #2: Some people said, 'Hey, maybe they're buying a bank.' No. We're not buying a bank. You guys have to understand what Gorilla Technology Capital does.

Speaker #2: It strengthens our ability to scale data center builds. Accelerate GPU infrastructure deployment. And more important, we participate materially in larger mandates with institutional-grade structures and governance.

Speaker #2: So if I summarize 2025 in one line, we delivered a historic revenue milestone. We executed a major profitability turnaround. We strengthened the balance sheet and positioned Gorilla for the next phase of AI infrastructure which is sovereign and regional.

Speaker #2: More importantly, distributed which is becoming increasingly edge-enabled. In 2026, we shift from proving we can deliver to scaling what we can deliver. Converting execution into cash.

Jay Chandan: In 2026, we shift from proving we can deliver to scaling what we can deliver. Converting execution into cash, expanding our data center footprint across India, Malaysia, Thailand, Singapore, Indonesia, Middle East, and more importantly, using Gorilla Technology to unlock materially larger programs without compromising. All this while accelerating our product roadmap, which means we're investing heavily into R&D. Thank you for your time. I will hand over to Bruce, who knows the numbers well enough to recite them without blinking. Bruce, please go ahead.

Speaker #2: Expanding our data center footprint across India, Malaysia, Thailand, Singapore, Indonesia, Middle East. And more importantly, using Gorilla Technology to unlock materially larger programs without compromising.

Speaker #2: All this while accelerating our product roadmap, which means we're investing heavily into R&D. Thank you for your time. I will hand over to Bruce, who knows the numbers well enough to recite them without blinking.

Speaker #2: Bruce, please go ahead. Thank you, Jay. I think you covered the main points in terms of the financials. I wanted to hit on a few things.

Bruce Bower: Thank you, Jay. I think you covered the main points in terms of the financials. I wanted to hit on a few things. First of all, we mentioned that the cash balance at the end of the year was $104.8 million. I'd just like to emphasize that due to the collections so far this year, the cash balance has actually increased. As of 26 February, it was $108 million of unrestricted cash and $116.6 of total cash. That is, in spite of spending $3 million this calendar year, in the last two months on share buybacks. We have been able to increase cash and also buy back shares this year. It's a strong start to the year.

Speaker #2: So first of all, we mentioned that the cash balance at the end of the year was 104.8 million. I'd just like to emphasize that due to the collections, so far this year, the cash balance has actually increased.

Speaker #2: So, as of the 26th of February, it was $108 million of unrestricted cash and $116.6 million of total cash. That is in spite of spending $3 million this calendar year.

Speaker #2: So in the last two months, on share buybacks. So we have been able to increase cash and also buyback shares this year. So it's a strong start to the year.

Speaker #2: The other thing I would point out is when we talked about freeing up the debt load or reducing the debt load and freeing up cash deposits, some people ask, "Why didn't you pay off all of the debt?" Well, the debt that we have remaining the 13.8 million is at an average interest rate of 3%.

Bruce Bower: The other thing I would point out is when we talked about freeing up the debt load or reducing the debt load and freeing up cash deposits, some people ask, Why didn't you pay off all the debt? Well, the debt that we have remaining, the $13.8 million, is at an average interest rate of 3%. To be blunt, it makes sense to keep it as flexible capital instead of repaying it and borrowing at higher rates. The last thing I would talk about is we issued guidance last year of $137 to 200 million as the revenue guidance range for this year. We are maintaining that. At this point, we're not prepared to issue gross margin or EBITDA guidance, stay tuned in the coming months.

Speaker #2: So, to be blunt, it makes sense to keep it as flexible capital instead of repaying it and borrowing at higher rates. The last thing I would talk about is we issued guidance last year of $137 to $200 million as the revenue guidance range for this year.

Speaker #2: We are maintaining that. At this point, we're not prepared to issue gross margin or EBITDA guidance. But stay tuned in the coming months. We announced that basically the range for why is there such a wide range from 137 to 200 million?

Bruce Bower: We announced that basically the range, for why is there such a wide range from $137 million to $200 million. It depends on the delivery schedule of certain data center projects we're pursuing with Freyr and also with others. That, I think, will have a very good update coming in the next month to month and a half about the timing of those projects, about the delivery schedule from Nvidia and then also with the customers. That should help to firm up the guidance and give you a better idea. With that, I'd just like to reinforce what we mentioned in the press release, what Jay said.

Speaker #2: It depends on the delivery schedule. Of certain data center projects, we're pursuing with FRAIR and also with others. That I think will have a very good update coming in the next month to month and a half.

Speaker #2: About the timing of those projects. About the delivery schedule. From NVIDIA and then also with the customers. And that should help to firm up the guidance and give you a better idea.

Speaker #2: With that, I'd just like to reinforce what we mentioned in the press release what Jay said. We believe that the balance sheet has improved to the point where we're able to fund our growth initiatives and also to buy back the shares if we feel that they're undervalued.

Bruce Bower: We believe that the balance sheet has improved to the point where we're able to fund our growth initiatives and also to buy back the shares if we feel that they're undervalued. That we can take on a lot of the growth projects that we've talked about, not just the increase in revenue this year, forecasted to be in the middle of the range would be, you know, almost a 70% increase, but also the contracts that we have in the pipeline. A $7 billion revenue opportunity in the pipeline, we believe that we can fund substantially through the access to debt facilities, mostly through project finance, and then through the cash that we have on the balance sheet at the moment.

Speaker #2: And that we can take on a lot of the growth projects that we've talked about, not just the increase in revenue this year, forecasted to be in the middle of the range would be almost a 70% increase.

Speaker #2: But also the contracts that we have in the pipeline. So a $7 billion revenue opportunity in the pipeline. We believe that we can fund substantially.

Speaker #2: Through the access to debt facilities, mostly through project finance, and then through the cash that we have on the balance sheet at the moment.

Speaker #2: With that, I'd like to turn it back to Jay. And if you want to open up the questions, we can do that.

Bruce Bower: With that, I'd like to turn it back to Jay and if, you know, want to open up the questions, we can do that.

Speaker #1: Thanks, Bruce. I'd love to open up the questions to all standing by. Thank you.

Jay Chandan: Thanks, Bruce. I'd love to open up the questions to all standing by. Thank you.

Speaker #3: Thank you. We will now begin the question and answer session. To join the question queue, you may press star, then 1 on your telephone keypad.

Kristen: Thank you. We will now begin the question and answer session. To join the question queue, you may press star then one on your telephone keypad. You will hear a tone acknowledging your request. If you are using a speakerphone, please pick up the handset before pressing any keys. To withdraw your question, please press star one again. We'll pause for a moment as callers join the queue. Your first question comes from Brian Kinstlinger with Alliance Global Partners. Please go ahead.

Operator: Thank you. We will now begin the question and answer session. To join the question queue, you may press star then one on your telephone keypad. You will hear a tone acknowledging your request. If you are using a speakerphone, please pick up the handset before pressing any keys. To withdraw your question, please press star one again. We'll pause for a moment as callers join the queue. Your first question comes from Brian Kinstlinger with Alliance Global Partners. Please go ahead.

Speaker #3: You will hear a tone acknowledging your request. If you are using a speakerphone, please pick up the handset before pressing any keys. To withdraw your question, please press star 1 again.

Speaker #3: We'll pause for a moment as callers join the queue. Your first question comes from Brian Nitzlinger with Alliance Global Partners. Please go ahead.

Brian Kinstlinger: Yeah, close enough. Great. Thanks so much, guys. You've come a certainly a very long way over the last two years. Congratulations on that.

Speaker #4: Yeah, close enough. Great. Thanks so much, guys. You've come a certainly a very long way over the last two years. Congratulations on that. Has anything changed in terms of your best guess on timing for the first three phases of the FRAIR partnership?

Jay Chandan: Yes.

Brian Kinstlinger: Has anything changed in terms of your best guess on timing for the first three phases of the Freyr partnership? I think the plan was project financing to help you start in April for phase one, September phase two, and December for phase three. The second part of that question, outside of financing these projects, are there any gating factors to starting these projects? If so, what needs to happen in those time frames?

Speaker #4: I think the plan was project financing to help you start in April for phase one, September for phase two, and December for phase three. And then a second part of that question: outside of financing these projects, are there any gating factors to starting these projects?

Speaker #4: And if so, what needs to happen in those time frames?

Jay Chandan: Brian, good to hear from you. Thank you for your, for your kind comments. We are on track with where we are today. Obviously, they're considering the market forces today. We have had some slight delays in terms of the delivery. That said, let me kind of walk you through what has happened. Some of the programs have moved in terms of timing, and we talked about the Freyr contract, for example. That is on schedule. We are currently in the final stages of getting our first set of GPUs coming through over the next few days, and we'll be deploying it as we speak. We have also accelerated the timings on some of the data center discussions.

Speaker #1: Brian, good to hear from you, and thank you for your kind comments. We are on track with where we are today. Obviously, there have been considerations given the market forces today.

Speaker #1: We have had some slight delays in terms of the delivery. But that said, let me kind of walk you through what has happened. Some of the programs have moved in terms of timing.

Speaker #1: And we talked about the FRAIR contract, for example. That is on schedule. We are currently in the final stages of getting our first set of GPUs coming through over the next few days.

Speaker #1: And we'll be deploying it as we speak. We have also accelerated the timings on some of the data center discussions as when we spoke last.

Jay Chandan: As when we spoke last, I think we were looking at about 12.5 megawatts of data centers, if you recollect. With the, you know, and we were looking at roughly around, you know, several high hundred high density AI racks. What we did was, rather than kind of commissioning them all on a single day, we're slowly putting them in planned base. So, you know, power cooling network zones are all commissioned. Revenue ramps are going to be energized as we speak. As the racks go live, we will drop in the clusters through our partner ecosystem, which also drives to what I call the GPU-as-a-service usage line.

Speaker #1: I think we were looking at about 12 and a half megawatts of data centers. If you recollect. With the and we were looking at roughly around several hundred high-density AI racks.

Speaker #1: What we did was, rather than kind of commissioning them all on a single day, we're slowly putting them in plan base. So, power, cooling, network zones are all commissioned.

Speaker #1: Revenue ramps are going to be energized as we speak. And as the racks go live, we will drop in the clusters through our partner ecosystems, which also drives what I call the GPU-as-a-Service usage line.

Speaker #1: Now, what is very exciting for us, and I can tell you today, is we have now realized that we would need to kind of be deploying a lot of capital in the data center space ourselves because we have been inundated with a ton of requirements.

Jay Chandan: Now, what is very exciting for us, and I can tell you today, is we have now realized that we would need to kind of be deploying a lot of capital in the data center space ourselves, because we are being inundated with a ton of requirements. We are now currently looking at about more than 600 megawatts of capacity rather than the, you know, 12 megawatts alone. That allows us to control our destiny over a period of time, which means we're looking at $several hundred million per year once all these racks and the GPUs are all in motion. From our perspective, Brian, the path to that particular point is a very controlled ramp up, not a single bang. Now, you talked about, you know, are there any delays? There are no significant delays so far.

Speaker #1: So we are now currently looking at about more than 600 megawatts of capacity rather than the 12 megawatts alone. And that allows us to control our destiny over a period of time, which means we're looking at several hundred million dollars per year once all these racks and the GPUs are all in motion.

Speaker #1: So from our perspective, Brian, the path to that particular point is a very controlled ramp-up, not a single ban. Now, you talked about are there any delays?

Speaker #1: There are no significant delays. So far. Thailand MOE, for example, it had been delayed because of the political transition. Some sort of departmental organization, as you know, the new prime minister that has been elected still, we're just waiting for the post-election leadership and sign-offs to settle, as we speak.

Jay Chandan: You know, Thailand MoE, for example, it had been delayed because of the political transition, some sort of departmental organization. You know, the new prime minister that has been elected, we're just waiting for the post-election leadership and sign-offs to settle as we speak. You know, otherwise, we are not facing any delays. We are going ahead with all of the approvals, all of the permitting, all of the site readiness, all of the customer prerequisites as we go into it. When the customer gates reopen now, I think we will start our billing on time. I hope that answers your question, Brian.

Speaker #1: But otherwise, we are not facing any delays. We are going ahead with all of the approvals, all of the permitting, all of the site readiness.

Speaker #1: All of the customer prerequisites flip as we go into it. So when the customer gets reopened now, I think we will start our billing on time.

Speaker #1: I hope that answers your question, Brian.

Brian Kinstlinger: It does. Thank you. My second question is, you've got this large pipeline of other data center opportunities you've discussed.

Speaker #4: It does. Thank you. My second question is, you've got this large pipeline of other data center opportunities you've discussed. And not to say that your business development has been slow.

Brian Kinstlinger: It does. Thank you. My second question is, you've got this large pipeline of other data center opportunities you've discussed.

Jay Chandan: Yes.

Brian Kinstlinger: Not to say that your business development has been slow, it's been very fast, but do you think those customers are waiting to see how execution is on the first Freyr contract? Is that going to, in the near term, hold back agreements? Do you think those will be able to move forward without delivery on those three projects?

Speaker #4: It's been very fast. But do you think those customers are waiting to see how execution is on the first FRAIR contract? Is that going to, in the near term, hold back agreements?

Speaker #4: Or do you think those will be able to move forward without delivery on those three projects?

Jay Chandan: Oh, absolutely not. You know, like I'd mentioned, our pipeline is exploding, we have not been slow in our sales plan, I can tell you. Only the thing we've been doing has been restricting. We've been inundated, and I'm not exaggerating, inundated is the right word for that. First of all, the deals are mature. At the start of the year of January this year, we were looking at POCs and MOUs and so on. Those were very promising, since then we have moved into late-stage commercial structuring or into full force contracting, which naturally kind of increases the scale and the certainty of the pipeline. If you recollect what I told at the end of December, towards the end of December, we are making sure that we have certainty of the pipeline.

Speaker #1: Oh, absolutely not. Like I'd mentioned, our pipeline is exploding. And we have not been slow in our sales, Brian. I can tell you, only the thing we've been doing has been restricting.

Speaker #1: We've been inundated—and I'm not exaggerating, 'inundated' is the right word for that. So first of all, the deals are mature. At the start of the year, in January this year, we were looking at POCs and MOUs and so on.

Speaker #1: Those were very promising. But since then, we've moved into late-stage commercial structuring. Or into full-force contracting, which naturally kind of increases the scale and the certainty of the pipeline.

Speaker #1: If you recollect what I told at the end of December, towards the end of December, we are making sure that we have certainty of the pipeline.

Speaker #1: Now, as I'd mentioned, the $1.4 billion Southeast Asia contract—that was only a catalyst. Once the government in TerraClose basically saw what we are able to deliver, and we started signing up with the first 12.5 megawatts, suddenly, out of nowhere, it triggered some sort of a sovereign-grade AI infrastructure requirement.

Jay Chandan: Now, as I'd mentioned, the $1.4 billion Southeast Asia contract, that was only a catalyst. Once the government in Terra Clerk basically saw what we are able to deliver, and we started signing up with, you know, the first 12.5 megawatts, suddenly out of nowhere, you know, it triggered some sort of, you know, sovereign grade AI infrastructure requirement and a huge surge in interest for us. I don't wanna give you names, but what has happened is the demand behind that is significantly larger than Freyr itself. That's one of the primary reasons why our pipeline is now in billions of dollars. Third most important part is things have changed from, you know, ambition. Governments are no longer looking at it as an ambition. It has turned into urgency for us. Now, I mentioned this last time as well.

Speaker #1: And this huge surge in interest for us. So I don't want to give you names, but what has happened is, but the demand behind that is significantly larger than FRAIR itself.

Speaker #1: So that's one of the primary reasons why our pipeline is now in billions of dollars. Third most important part is things have changed from ambition.

Speaker #1: Governments are no longer looking at it as an ambition. It has turned into urgency for us. Now, I mentioned this last time as well.

Speaker #1: Not only are we looking at GPU capacity as strategic infrastructure, the shift has actually moved into edge compute. Distributed environments are taking shape right now.

Jay Chandan: Not only are we looking at, you know, GPU capacity as strategic infrastructure, the shift has actually moved into edge compute. Distributed environments are taking shape right now. Like I said, the market has missed that already. People think, Oh, is the spending going to continue? It is going to accelerate. It is not going to continue at the rate it is going. It is going to go exponential. We are sitting with every single major customer on the planet, and I can tell you these platforms are just going to explode in terms of compute requirements and demand. Finally, our execution has not just been on 1 data centers, Brian. We've been doing data centers for a very long time. We built data centers on behalf of governments, for example, in Taiwan, in Thailand, in Egypt, and so on and so forth.

Speaker #1: And like I said, the market has missed that already. People think, oh, is the spending going to continue? It is going to accelerate. It is not going to continue.

Speaker #1: The rate is going. It is going to go exponential. We are sitting with every single major customer on the planet. And I can tell you, these platforms are just going to explode in terms of compute requirements and demand.

Speaker #1: Then finally, our execution has not just been on one data center, Brian. We've been doing data centers for a very long time. We built data centers on behalf of governments, for example.

Speaker #1: In Taiwan, in Thailand, in Egypt, and so on and so forth. So things like when we deploy large-scale local interception programs which are more complex than putting up a data center, the governments and the organizations, they look at it and say, look, what is Gorilla delivered?

Jay Chandan: Things like when we deploy large scale lawful interception programs, which are more complex than putting up a data center, the governments and the organizations, they look at it and say, Look what has Gorilla delivered. They see that and the confidence grows. We are not resting on our past laurels, but we are putting everything into motion. Like I said in my previous response, we are now targeting over 600 megawatts of power. The opportunity here is very comfortably substantial, Brian, and it's only growing.

Speaker #1: They see that, and the confidence grows. So we are not resting on our past laurels, but we are putting everything into motion. So, like I said in my previous response, we are now targeting over 600 megawatts of power.

Speaker #1: So the opportunity had this very comfortably substantial, Brian. And it's only growing.

Speaker #4: Great. My last question—you highlighted your recruitment needs. Thanks. It's in my career, in your type of business, always a great leading indicator. How would you characterize the recruiting market in the geographies you're hiring?

Brian Kinstlinger: Great. My last question, you highlighted your recruitment needs. Thanks. It's, in my career, in your type of business, always a great leading indicator. How would you characterize the recruiting market in the geographies you're hiring? Outside of the execution staff, are there significant needs of the AI HPC senior executive level that gives you that, you know, add strategy and expertise at the high level?

Speaker #4: And then, outside of the execution staff, are there significant needs at the AI HPC senior executive level that give you that ad strategy and expertise at a high level?

Jay Chandan: That's a really good question. As you know, we are hiring at a rapid pace. What you don't see is, you know, on our website the names of the top people we have hired already. In Thailand, we are actually going strong with, you know, hires of about 80-plus people. In Taiwan, we have deployed a significant data center team and an R&D team for our cybersecurity products. We have done that through what is called as a hub-and-spoke model. This is very important because our R&D platform and engineering needs to accelerate both our product and our services capabilities. On the services side, as you know, Satish came in mid of last year, and he's been driving all of the client impact and deepening our technical capabilities.

Speaker #1: That's a really good question. So, as you know, we are hiring at a rapid pace. What you don't see on our website are the names of the top people we've hired already.

Speaker #1: In Thailand, we're actually going strong with hires of about 80-plus people. In Taiwan, we have deployed a significant data center team and an R&D team for our cybersecurity products.

Speaker #1: We have done that through what is called a hub-and-spoke model. This is very important because our R&D platform and engineering meet to accelerate both our product and our services capabilities.

Speaker #1: So on the services side, as you know, Satish came in mid of last year. And he's been driving all of the client impact and deepening our technical capabilities.

Speaker #1: On the R&D side, we've been hiring SD-WAN post-quantum cryptography, local interception capability, video analytics. We've been growing that product. And like I promised, by April, we would have a fully launched world's first fully ready post-quantum crypto SD-WAN.

Jay Chandan: On the R&D side, we've been hiring SD-WAN, post-quantum cryptography, lawful interception capability, Video Analytics. We've been growing that product. Like I promised, by April, we would have a fully launched, world's first, fully ready post-quantum crypto SD-WAN. We're already working on massive proof of concepts with customers as well. This is what matters, Brian: localization. Every single region we're working in, whether it's India, Middle East, North Africa, Southeast Asia, East Asia, they're all asking about how are you building stronger ground capacity. What do we do? We're building teams in Thailand. My team in Thailand, for example, because we're looking at some very large data centers here, will be about 1,000 people. If by the end of this year, it'll be probably 1,000 people in Thailand.

Speaker #1: And we're already working on massive proof of concepts with customers as well. But this is what matters, Brian: localization. Every single region we're working in—whether it's India, the Middle East, North Africa, Southeast Asia, East Asia—they're all asking about how are you building stronger ground capacity.

Speaker #1: So what do we do? We're building teams in Thailand. So my team in Thailand, for example, because we're looking at some very large data centers here, will be about 1,000 people.

Speaker #1: If by the end of this year, it'll be probably 1,000 people in Thailand. We'll be about between 200 to 300 people in India. And our Taiwan team will be north of 200-plus people.

Jay Chandan: We'll be about between 200 to 300 people in India. Our Taiwan team will be north of 200+ people. We are hiring senior executives as well at the same time. As we've seen, Thomas has come in and joined as the CTO of infrastructure. Jackie has come in from the hardware side and become the GM for Asia. We are also hiring next-level capability under them as well. At the same time, we're also making sure that finance and compliance are also tightened. We are hiring to improve cash discipline, collections, control, audits, and so on and so forth.

Speaker #1: Now, we are hiring senior executives as well at the same time. As you've seen, Thomas has come in and joined as a CTO of infrastructure.

Speaker #1: Jackie has come in from the hardware side and become the GM for Asia. We're also hiring next-level capability under them as well. At the same time, we're also making sure that finance and compliance are also tightened.

Speaker #1: So, we are hiring to improve cash discipline, collections, control, audits, and so on and so forth. So, think about it this way: the hub-and-spoke model is going to be centered across each of these regions.

Jay Chandan: Think about it this way: The hub and spoke model is going to be centered across each of these regions. As we expand and grow, we will be expanding our teams rapidly over the next course of few months. The teams are already and running at a rapid space.

Speaker #1: And as we expand and grow, we will be expanding our teams rapidly over the next course of a few months. And the teams are already running at a rapid pace.

Speaker #4: Great. Thanks for all your answers.

Brian Kinstlinger: Great. Thanks for all your answers.

Speaker #1: Thanks, Brian.

Jay Chandan: Thanks, Brian.

Kristen: Your next question comes from the line of Bharath Nagaraj, I'm sorry, Nayaga with Cantor Fitzgerald. Please go ahead.

Operator: Your next question comes from the line of Bharath Nagaraj, I'm sorry, Nayaga with Cantor Fitzgerald. Please go ahead.

Speaker #3: Your next question comes from the line of Barath Niaga. I'm sorry, Niaga with Cantor Fitzgerald. Please go ahead.

Bharath Nagaraj: Hi. Thank you. Thanks for the presentation. Just a few questions from me. Just to start off with on the gross margin, just wondering on the mix which resulted in a slightly different gross margin than what I was expecting, but just wanted to understand what the mix of revenues is. The second question is around, given that you're gonna deploy the latest compute for data centers in Southeast Asia, what kind of level of revenue are you modeling per megawatt there? What sort of use cases are you thinking about for that?

Speaker #5: Hi. Thank you. Thanks for the presentation. Just a few questions from me. Just to start off with, on the gross margin, just wondering, on the mix, which resulted in a, let's say, a slightly different gross margin than what I was expecting, but just wanted to understand what the mix of revenues is.

Speaker #5: And then the second question is around, given that you're going to deploy the latest compute for data centers in Southeast Asia, what kind of level—or what level of revenue—are you modeling per megawatt there?

Speaker #5: What sort of use cases are you thinking about for that?

Jay Chandan: Bruce, do you wanna take the first part of the question? I'll take the second part.

Speaker #1: Bruce, do you want to take the first part of the question? I'll take the second part.

Bruce Bower: Sure. Sure. I think a better way to think about it is 2024, we had an abnormally high service mix in the revenue mix, the majority was service. It was a higher percentage of hardware in 2025. It was sort of 40%. That's why the gross margins were a little bit lower than you would expect. The other thing is that we announced last year that we had signed 2 major law enforcement customers in Asia. In at least one of those cases, the margin that we had predicted going into the project was a little bit lower than we normally accept. That's because it was a key win for us as a client and, you know, as a solution to demonstrate our capabilities. Altogether, that is what...

Speaker #5: Sure. Sure. So I think a better way to think about it is 2024, we had an abnormally high service mix. In the revenue mix, so the majority was service.

Speaker #5: And then it was a higher percentage of hardware in 2025. It was sort of 40%, so that's why the gross margins were a little bit lower than you would expect.

Speaker #5: The other thing is that we announced last year that we had signed two major law enforcement customers in Asia. And in at least one of those cases, the margin that we had predicted going into the project was a little bit lower than we normally accept.

Speaker #5: That's because it was a key win for us as a client and as a solution to demonstrate our capabilities. So altogether, that is what that is why the margin drifted a little bit lower.

Bruce Bower: That is why the margin drifted a little bit lower. I would say that going forward, building on what Jay mentioned about the pipeline, we have the ability to be very choosy about the projects that we do. Because we have so much demand, you know, if the margin terms, if the credit terms or the credit profile of the customer isn't right or, you know, if the payment terms aren't there, then we just say, "I'm sorry, you either come in line or we'll move on to the next project." The other thing is that the data center, the GPU-as-a-Service has an extremely high gross margin, so it's 70% plus. 70% is kind of the minimum cutoff. There is obviously a depreciation hit because we would...

Speaker #5: I would say that, going forward—so, building on what Jay mentioned about the pipeline—we are much, we have the ability to be very choosy about the projects that we do.

Speaker #5: So because we have so much demand if the margin terms, if the credit terms or the credit profile of the customer isn't right, or if the payment terms aren't there, then we just say, "I'm sorry.

Speaker #5: You either come in line or we'll move on to the next project." The other thing is that the data center the GPU is a service has an extremely high gross margin.

Speaker #5: So it's 70% plus. 70% is kind of the minimum cutoff. There is obviously a depreciation hit because we would an SPV would hold the equipment and then that would be consolidated onto our financial statements.

Bruce Bower: An SPV would hold the equipment and then that would be consolidated onto our financial statements, and we would take the depreciation charge. I would say at scale that would be like a 25% operating margin. That is at scale. I'm not providing yet the forecast for margins for this year. We're going to wait until we get the exact details firmed up. That's how I would see, you know, 2025 as kind of a dip in terms of gross margins, and I would see them improving over time and, you know, a much stronger margin profile for all the new business coming in.

Speaker #5: And we would take the depreciation charge. I would say at scale, that would be like a 25% operating margin. But that is at scale.

Speaker #5: I'm not providing yet the forecast for margins for this year. We're going to wait until we get the exact details firmed up. But that's how I would see so that's how I would see 2025 is kind of a dip.

Speaker #5: In terms of gross margins, I would see them improving over time and a much stronger margin profile for all the new business coming in.

Jay Chandan: Just to add to that as well, Bharat, more importantly, we're investing very, very heavily into, you know, building the business for sustainable long-term, you know, growth and gross margins, right? That brings me to the second part of your question. In terms of pricing today, you know, in Asia, it's structured either in what we call as capacity per server per month or in terms of usage per kilowatt hour, depending on the customer and the program. Typically, for sovereign enterprise deployments, we are targeting contracted multi-year take or pay kind of a style, where the pricing and sustainable margins and cash conversion is predefined. We know exactly what we're getting ourselves into. We avoid quoting a single rate.

Speaker #1: And just to add to that as well, Barath, more importantly, we're investing very, very heavily into building the business for sustainable long-term growth and gross margins, right?

Speaker #1: Now, that brings me to the second part of your question. In terms of pricing today, in Asia, it's structured either in what we call as capacity per server per month or in terms of usage per kilowatt-hour, depending on the customer and the program.

Speaker #1: Typically, for sovereign enterprise deployments, we are targeting contracted multi-year take or pay kind of a style. Where the pricing and sustainable margins and cash conversion is predefined.

Speaker #1: So we know exactly what we're getting ourselves into. Now, we avoid coding a single rate. I mean, personally, I don't want to code a single rate because it varies by GPU class, as you know.

Jay Chandan: I mean, personally, I don't wanna quote a single rate because it varies by GPU class, as you know, term length, utilization profile, you know, power, cooling specs, location, land value, service level stack, and so on and so forth. The proof point for us comes only when we sign these programs where the unit economics are very disciplined and our collections and our milestone payments protect our cash. You know, there is no single kind of an Asia price, if I may. We're not just looking at Southeast Asia, by the way. There's no Middle East or Asia price.

Speaker #1: Term length, utilization profile, power, cooling specs, location, land value, service level stack, and so on and so forth. But the proof point for us comes only when we sign these programs where the unit economics are very disciplined and our collections and our milestone payments protect our cash.

Speaker #1: So there is no single kind of an Asia price, if I may. We're not just looking at Southeast Asia, by the way. There's no Middle East or Asia price.

Speaker #1: But that said, I can tell you, typically, if you're looking at CSP class GPU rack capacity, they can run in high four figures to low five figures per GPU per month.

Jay Chandan: That said, I can tell you, typically, if you're looking at, you know, CSP class GPU rack capacity, they can run in, you know, $high four figures to $low five figures per GPU per month, when bundled with power, floor space, connectivity, managed services. Also remember, these are long-dated fixed milestone agreements. We often layer, you know, what we call a service level fees, compliance components, and so on and so forth. Now, each of these can change. For example, in the US, you know, spot rents for, you know, top tier GPU can be 2x to 3x typically on what you see on structured regional capacity in Asia. What we are doing is that we are not putting a standard rate.

Speaker #1: When bundled with power, floor space, connectivity, and managed services—but also remember, these are long-dated, fixed-milestone agreements. So we often layer what we call service-level fees, compliance components, and so on and so forth.

Speaker #1: Now, each of these can change. For example, in the US, spot rents for top-tier GPU can be X to 3X, typically, on what you see on structured regional capacity in Asia.

Speaker #1: But what we are doing is that we are not putting a standard rate and because our compute requirements are more stringent here, and our contracted deals are much more longer, we're able to create a highly what I call competitive pricing as opposed to even the United States.

Jay Chandan: Because our compute requirements are more stringent here and our contracted deals are much more longer, we're able to create a highly what I call competitive pricing as opposed to even the United States. Think about it this way, you know, where compliance premium and service premium will do about 20% to 40%, where we include governance, telemetry, managed ops, and so on and so forth, but the energy cost differentials mean that the Asia deals are often much more profitable. You know, if I may say this, you know, comparing Asia and the US is like, you know, thinking like, you know, hotel in Vegas might be cheaper, but, you know, penthouses in Bangkok are much more expensive than some of them even in Manhattan, so. Does that answer your question, Bharat?

Speaker #1: So think about it this way. We're compliance premium and service premium will do about 20 to 40 percent where we include governance, telemetry, managed ops, and so on and so forth.

Speaker #1: But the energy cost differentials mean that Asia deals are often much more profitable. So if I may say this, comparing Asia and the US is like thinking like hotel in Vegas might be cheaper, but 10,000 in Bangkok are much more expensive than some of them even in Manhattan.

Speaker #1: Barath.

Speaker #2: Yeah, absolutely. Thank you. May I just sneak in a quick couple more? Small ones. Does the Arcticos acquisition that you made, does that carry, in terms of your strategy, are you planning to have an explicit pricing and margin contribution for the new contracts that you sign for this?

Bruce Bower: Yeah, absolutely. Thank you. May I just sneak in?

Jay Chandan: Sure.

Bruce Bower: quick couple more, small ones?

Jay Chandan: Please.

Bruce Bower: Does the Astrikos.ai acquisition that you made, in terms of your strategy, are you planning to have an explicit pricing and margin contribution for the new contracts that you signed for this? Or is it currently being bundled to strengthen your competitive advantage and increase like long-term customer lifetime value?

Speaker #2: Or is it currently being bundled to strengthen your competitive advantage and increase long-term customer lifetime value?

Speaker #1: That's a great question. Let me kind of give you an update. Why we invested, why we are integrating, right? I think that's your question.

Jay Chandan: That's a great question. Let me kind of give you an update why we invested, why we are integrating, right? I think that's your question and what are we going to do. What does your springboard look like, right? If you'd asked me, I don't know, that would be a question I would ask myself. When we actually looked at Astrikos.ai, first of all, what is Astrikos.ai? Astrikos.ai is a real-time infrastructure intelligence engine that does monitoring, prediction, and optimization for critical systems. Now, it is already a deployed system in very serious environments, including some high state level smart city platforms, for example, the new Indian parliament complex. I think you and I talked about it previously. Major initiatives in the Middle East as well. That matters because Astrikos.ai is not a demo, it is a fully deployed solution.

Speaker #1: And what are we going to do? What does your springboard look like, right? If you'd asked me, that would be a question I would ask myself.

Speaker #1: When we actually looked at Arcticos, first of all, what is Arcticos? Arcticos is a real-time infrastructure intelligence engine that does monitoring prediction, optimization for critical systems.

Speaker #1: Now, it is already a deployed system in very serious environments, including some high-stake level smart city platforms, for example, the new Indian parliament complex.

Speaker #1: Think you and I talked about it previously. And major initiatives in the Middle East as well. That matters because Arcticos is not a demo.

Speaker #1: It is a fully deployed solution. Now, your second part of your question, what are we doing with it? We're integrating the Arcticos into three parts of our stack.

Jay Chandan: Now, your second part of your question, what are we doing with it? We're integrating our Astrikos.ai into three parts of our stack. First, most important, smart city and national infrastructure operation. It gives us telemetry and prediction layer that makes national infrastructure more measurable, but at the same time optimizable in real time. Now, what does that mean? It strengthens our ability to sell outcomes, not just the technology, with real uptime and response time, threat detection, and finally, we have what is called it generating high operational efficiency for the customer. The second is Video Intelligence and security. Now, Astrikos.ai, you know, typically enhances real-time monitoring or, you know, your positioning around critical infrastructure, security and operational workflows. It complements our Video Intelligence stack, and it allows us to improve our operationalization of the data across our SOCs and MOC environments.

Speaker #1: First, most important, smart city and national infrastructure operation. It gives us telemetry and prediction layer that makes national infrastructure more measurable, but at the same time, optimizable in real time.

Speaker #1: Now, what does that mean? It strengthens our ur ability to sell outcomes, not just the technology. With real uptime and response time, threat detection, and finally, we have what is called as it's generating high operational efficiency for the customer.

Speaker #1: The second is video intelligence and security. Now, Arcticos typically announces real-time monitoring or your decisioning around critical infrastructure security and operational workflows. It complements our video intelligence stack, and it allows us to improve our operationalization of the data across our SOCs, our MARC environments.

Speaker #1: And finally, this is very, very important. This is a big one. GPU-rich data centers and environments are like a standard data center. You cannot run very heavy GPU environments.

Jay Chandan: Finally, this is very, very important. This is a big one. GPU-rich data centers and environments are, you know, like a standard data center. You cannot run very heavy GPU environments. You will need continuous telemetry, predictive optimization, integrated security, and operational automation. This is where Astrikos.ai actually plugs into that requirement. On the kind of the springboard, and if I was looking at Astrikos.ai, for me, it's a springboard in India, but it's very immediate because it brings deep presence in the region, shortens our sales cycle, improves our delivery readiness. In the UAE, we're already kind of working on building our Middle Eastern footprint. In the US, you know, is a standard in a partnership-driven market, so we are kind of progressing market-level entry work in that region as well. Think about it this way, we're a significant minority investor.

Speaker #1: You will need continuous telemetry predictive optimization, integrated security, and operational automation. This is where Arcticos actually plugs into that requirement. And then on the kind of the springboard, and if I was looking at Arcticos, for me, it's a springboard in India.

Speaker #1: But it's very immediate because it brings deep presence in the region, shortens our sales cycle, improves our delivery readiness. In the UAE, we're already kind of working on building our Middle Eastern footprint.

Speaker #1: In the USA, it's a standard and a partnership-driven market. So we are kind of progressing market-level entry work in that region as well. So think about it this way.

Speaker #1: We're a significant minority investor. We have an option to materially increase our ownership, but also giving us a lot of flexibility to integrate and progress the traction on a very large commercial scale.

Jay Chandan: We have an option to materially increase our ownership, but also giving us a lot of flexibility to integrate and progress the traction on a very large commercial scale. Bharat?

Speaker #1: Barath?

Speaker #2: Yeah, absolutely. Thank you. That's very helpful indeed. Thank you very much.

Bharath Nagaraj: Yeah, absolutely. Thank you. That's very helpful indeed. Thank you very much.

Speaker #1: Thank you, Barath.

Jay Chandan: Thank you, Bharat.

Kristen: Your next question comes from the line of Michael Latimore with Northland Capital Markets. Please go ahead.

Speaker #3: Your next question comes from the line of Mike Lattimore with Northland Capital Markets. Please go ahead.

Operator: Your next question comes from the line of Michael Latimore with Northland Capital Markets. Please go ahead.

Speaker #4: Hi. Yeah. Thanks very much. Yeah, congrats on a great year. Excellent results, sir. I guess just a couple of things. You talk about maybe some more collections coming in here.

Michael Latimore: Hi. Yeah. Thanks very much. Yeah, congrats on a, on a great year. Excellent results there.

Mike Latimore: Hi. Yeah. Thanks very much. Yeah, congrats on a, on a great year. Excellent results there.

Jay Chandan: Thank you.

Michael Latimore: I guess just a couple things. You talked about maybe some more collections coming in here this quarter. Can you frame that a little bit more? Is that we're talking a few million dollars? Are you talking over $10 million or, you know, or maybe you can't say it, but just kinda curious on that.

Mike Latimore: I guess just a couple things. You talked about maybe some more collections coming in here this quarter. Can you frame that a little bit more? Is that we're talking a few million dollars? Are you talking over $10 million or, you know, or maybe you can't say it, but just kinda curious on that.

Speaker #4: This quarter, can you frame that a little bit more? Is that we're talking a few million dollars? You're talking over 10 or maybe you can't say it, but just kind of curious on that.

Jay Chandan: Bruce, do you wanna take that?

Speaker #1: Bruce, do you want to take that?

Bruce Bower: I would say it's $10 million ± a few million, you know, $2, 3 million on either side.

Speaker #5: I would say it's plus or minus. It's 10 million plus or minus a few million, 2, 3 million on either side.

Bruce Bower: I would say it's $10 million ± a few million, you know, $2, 3 million on either side.

Michael Latimore: Okay. That relates to the 2025 efforts?

Mike Latimore: Okay. That relates to the 2025 efforts?

Speaker #4: Okay. And that relates to the 2025 efforts?

Bruce Bower: It's solutions that were delivered and invoiced in 2025, yes.

Speaker #5: It's solutions that we're delivered and invoiced in 2025. Yes.

Michael Latimore: Okay, great. Just to keep it simple for me here. The large Southeast Asian deal, so it sounds like pretty much no change there in terms of total value or value by each of the first three data centers. Is that right?

Mike Latimore: Okay, great. Just to keep it simple for me here. The large Southeast Asian deal, so it sounds like pretty much no change there in terms of total value or value by each of the first three data centers. Is that right?

Speaker #4: Okay, great. And then just to keep it simple for me—the large Southeast Asian deal. So, it sounds like there's pretty much no change there in terms of the total value, or the value by each of the first three data centers.

Speaker #4: Is that right?

Speaker #1: That's correct. So but that has become a catalyst, like I'd mentioned previously.

Jay Chandan: That's correct. That has become a catalyst, like I've mentioned previously.

Speaker #4: Okay. Great. And then Jay, you talked a little bit about maybe seeing your first group of GPUs in the next few days. I guess just a little bit more on that.

Michael Latimore: Okay, great. Jay, you talked a little bit about maybe seeing your, first group of GPUs in the next few days. I guess just a little bit more on that. Does that specifically relate to the Southeast Asia deal? Also, how... Did you sort of say that, you know, you expect sort of to get some of these GPUs every week, and then, you know, that builds over time? Maybe just a little more clarity on kinda that pattern.

Mike Latimore: Okay, great. Jay, you talked a little bit about maybe seeing your, first group of GPUs in the next few days. I guess just a little bit more on that. Does that specifically relate to the Southeast Asia deal? Also, how... Did you sort of say that, you know, you expect sort of to get some of these GPUs every week, and then, you know, that builds over time? Maybe just a little more clarity on kinda that pattern.

Speaker #4: Does that specifically relate to the Southeast Asia deal? And then also, did you sort of say that you expect to get some of these GPUs every week, and then that builds over time?

Speaker #4: Or maybe just a little more clarity on kind of that pattern?

Speaker #1: Sure. So I think we're creating a flywheel effect. If I may, Mike, what we are doing is we are making sure that we have delivery coming in every week.

Jay Chandan: Sure. I think, you know, we're creating a flywheel effect, if I may, Mike. What we are doing is we are making sure that we have delivery coming in every week. The latest agreements we have with our OEMs is that starting next week, we're getting a few deliveries going in. Again, well, I've mentioned this previously as well, we've actually won other contracts as well, so we are actually delivering against those contracts as well. You will see a regular flow of the, you know, that's why we've hired a very solid procurement team as well, which will make sure that these deliveries are on time. For us, you know, these data centers are driving GPU demand, and for us, our GPU demand unlocks much more deeper national engagements.

Speaker #1: So, the latest agreements we have with our OEMs is that starting next week, we're getting a few deliveries going in. But again, I'll mention this, as I previously mentioned as well.

Speaker #1: We've actually won other contracts as well. So we're actually delivering against those contracts as well. So you will see a regular flow of that's why we've hired a very solid procurement team as well.

Speaker #1: Which will make sure that these deliveries are on time. So for us, these data centers are driving GPU demand. And for us, our GPU demand unlocks much more deeper national engagements.

Speaker #1: So you don't look at it as the prayer contract as a one-off. This is actually like I said, a catalyst to some very large contracts we've already signed.

Jay Chandan: You don't look at the Freyr contract as a one-off. This is actually, like I said, a catalyst to some very large contracts we've already signed. We've also agreed, by the way, with all of the OEMs, local OEMs in the region. We've signed all of the MOUs that's required. We've signed all the LOIs and the pricing agreements. The BOMs have been done. The SOWs have been completed. As you know, we are now just working on the delivery schedules and the mechanisms over the next few weeks.

Speaker #1: We've also agreed, by the way, with all of the OEMs, local OEMs in the region, we've signed all of the MOUs that are required.

Speaker #1: We've signed all the LOIs and the pricing agreements, the BOMs have been done, the SOWs have been completed. And as you know, we are now just working on the delivery schedules and the mechanisms over the next few weeks.

Speaker #4: Got it. So these GPUs will go to more than the Southeast Asia customers, how it sounds like?

Michael Latimore: Got it. These GPUs will go to more than the Southeast Asia customer? Is that what it sounds like?

Mike Latimore: Got it. These GPUs will go to more than the Southeast Asia customer? Is that what it sounds like?

Jay Chandan: Yes.

Speaker #1: Yes, if you give us a few more days, please, on that, I'll give you a very concrete schedule as well.

Jay Chandan: Yes.

Michael Latimore: Okay.

Mike Latimore: Okay.

Jay Chandan: If you give us a few more days, please, on that.

Michael Latimore: Yeah.

Mike Latimore: Yeah.

Jay Chandan: I'll give you a very concrete schedule as well.

Speaker #4: Okay. Great. And then I guess in terms of the Southeast Asia deal, the first data center, you're still thinking gets up and running in the second quarter?

Michael Latimore: Okay. Great. I guess in terms of the Southeast Asia deal, the first data center, you're still thinking gets up and running in Q2?

Mike Latimore: Okay. Great. I guess in terms of the Southeast Asia deal, the first data center, you're still thinking gets up and running in Q2?

Jay Chandan: We are, we're trying to push it for Q1, you know, depending on the delivery schedules, but I am, I am 100% confident, 101% confident that it will be live, Q2. We've just completed the agreement on the, on the BOM. We have sent the BOMs to our OEM partners. Obviously, as you can imagine, it's not just the GPUs coming in. You've got a whole bunch of networking equipment which have to come along with that. As we, you know, kind of scale up with the customer and the demand accelerates, we will have to then kind of, you know, build on top of it. Now, one of the things, Mike, I think your question leads to another important aspect.

Speaker #1: We're trying to push it for the first quarter. Depending on the delivery schedules. But I am 100% confident, 101% confident that it will be live second quarter.

Speaker #1: We've just completed the agreements on the BOM. We have sent the BOMs to the OEM partners. Obviously, as you can imagine, it's not just the GPUs coming in.

Speaker #1: You've got a whole bunch of networking equipment which have to come along with that. And as we kind of scale up with the customer, and the demands accelerate, we will have to then kind of build on top of it.

Speaker #1: Now, one of the things I think your question leads to another important aspect. We have been struggling to get all of the compute demand from our end customers to be satisfied in the regions.

Jay Chandan: We have been, you know, struggling to get all of the compute demand from our end customers to be satisfied in the regions. As you can imagine, the US is investing, you know, hundreds of billions of dollars. We don't foresee that kind of investment within this region. Yes, we've seen, you know, KKR acquire SCP for $10 billion recently. Again, to deploy at data centers at scale, we need a lot more compute. We have decided internally that we were going to build our own using modular technology. You know, we're currently targeting about 600+ megawatts, and hopefully, fingers crossed, we should be able to complete all of the signing of those by the end of this year as well. We'll be going into full-scale production towards the latter part of this year as well.

Speaker #1: As you can imagine, the US is investing hundreds of billions of dollars. We don't see that kind of investment within this region. Yes, we've seen KKR acquire STT for $10 billion.

Speaker #1: Recently, but again, to deploy it at data centers at scale, we need a lot more compute. So we have decided internally that we were going to build our own using modular technology.

Speaker #1: So we're currently targeting about 600-plus megawatts. And hopefully, fingers crossed, we should be able to complete all of the signing of those by the end of this year as well.

Speaker #1: And we'll be going into full-scale production to the latter part of this year as well. So we're super excited. And we think we are actually creating a new market which doesn't exist currently.

Jay Chandan: We're super excited, and we think we are actually creating a new market which doesn't exist currently.

Michael Latimore: All right. Well, great.

Mike Latimore: All right. Well, great.

Speaker #4: Got it. Great. And then maybe the strategy to buy and build some of your data centers changes. This question, but I think on your business update call in January, you mentioned that you're trying to lease out any available capacity you can in co-locations across the regions.

Jay Chandan: Thank you.

Michael Latimore: Maybe the strategy to, you know, buy and build some of your data center has changed with this question. I think in, on your business update call in January, you mentioned that, you know, you're trying to lease out any available capacity you can in, you know, co-locations across the regions. I guess, any update on, you know, more... Any new leases that you've executed on?

Mike Latimore: Maybe the strategy to, you know, buy and build some of your data center has changed with this question. I think in, on your business update call in January, you mentioned that, you know, you're trying to lease out any available capacity you can in, you know, co-locations across the regions. I guess, any update on, you know, more... Any new leases that you've executed on?

Speaker #4: I guess any update on more any new leases that you've executed on?

Speaker #1: Yes, yes, yes. We already have signed many deals in the region. It's absolutely fascinating. But the problem is, like I said, it doesn't exist.

Jay Chandan: Yes, yes. We already have signed many deals in the region. It's absolutely fascinating. The problem is, like I said, it doesn't exist. You know, whether it's 9 megawatts, 4.5 megawatts, 9.9 megawatts, 21 and 25, that's kind of the available capacity today, okay? You're absolutely right. What are we gonna do? We're simply going to turn and build new capacity and deliver infrastructure ourselves to the end customer, right? Mike, I've not made this, maybe I've not made this clear previously. Our demand is in hundreds of megawatts, okay? Asia, not just... I'm not talking about Southeast Asia or East Asia or even South Asia. Asia Pacific as a whole does not have the capacity right now.

Speaker #1: Whether it's 9 megawatts, 4.5 megawatts, 9.9 megawatts, 21, and 25, that's kind of the available capacity today, okay? So you're absolutely right. What are we going to do?

Speaker #1: We're simply going to turn and build new capacity and deliver infrastructure ourselves to the end customer. Right? Mike, I've not made this maybe I've not made this clear previously.

Speaker #1: Our demand is in hundreds of megawatts, okay? And Asia—not just, I'm not talking about Southeast Asia, or East Asia, or even South Asia.

Speaker #1: Asia Pac as a whole does not have the capacity. Right now. India, for example, has only 1 gigawatt of fully utilized scale. And as you've seen recently, they had the AI summit.

Jay Chandan: India, for example, has only 1 gigawatt of fully utilized scale. As you've seen recently, they had the AI summit, and India is absolutely going bonkers in terms of deploying the scale. There are other structural issues. We need power, we need water, and so on and so forth, right? We are working, and just FYI, we are working very closely with the Indian government so as to make sure that we get our infrastructure ready across various requirements and various architectures and edge deployments in the country as well. Long story short, keep your eyes on your field. We're definitely headed in the right direction over the next few days.

Speaker #1: And India is absolutely going bonkers in terms of deploying the scale. But there are other structural issues. We need power. We need water, and so on and so forth.

Speaker #1: Right? So we are working. And just FYI, we are working very closely with the Indian government to make sure that we get our infrastructure ready across various requirements and various architectures and edge deployments in the country.

Speaker #1: As well. So, long story short, keep your eyes and ears peeled. We are definitely headed in the right direction over the next few days.

Michael Latimore: All right. Excellent. Thanks very much.

Mike Latimore: All right. Excellent. Thanks very much.

Speaker #4: All right. Excellent. Thanks very much.

Bruce Bower: One thing I would add to that.

Speaker #3: One thing I would add to that. Is that when we're looking at reserving or lining up capacity or building it ourselves, this is a different we're not in the business of building scale and building it and hoping the customers come.

Jay Chandan: Thank you, Mike. Please.

Bruce Bower: Is that when we're looking at, you know, lining up capacity or building it ourselves, we're not in the business of building scale and building it and hoping the customers come. The business here is purpose-built, AI-focused data centers or GPU-as-a-service for those clients. What that means is, first of all, we're not going to invest capital until we see clear customer demand. The second thing is that we demand customer prepayments so that, you know, money talks. In most cases, the customer prepayments are an integral part of our financing strategy, so that in between project finance and customer prepayments, we can secure 90% plus of a project's CapEx cost.

Speaker #3: The business here is purpose-built—AI-focused data centers or GPU as a service for those clients. So what that means is, first of all, we're not going to invest capital until we see clear customer demand.

Speaker #3: The second thing is that we demand customer prepayments so that money talks. And then in most cases, the customer prepayments are an integral part of our financing strategy so that in between project finance and customer prepayments, we can secure 90% plus of a project capex cost.

Speaker #3: So what we found is that when customers show commitment upfront, it obviously makes us more comfortable to move ahead. And it also makes it more likely that the economics work in our favor.

Bruce Bower: What we found is that, you know, when customers show commitment upfront, it obviously makes us more comfortable to move ahead, and it also makes it more likely, you know, that the economics work in our favor.

Speaker #2: Your next question comes from the line of John Roy with Water Tower Research. Please go ahead.

Kristen: Your next question comes from the line of John Roy with Water Tower Research. Please go ahead.

Operator: Your next question comes from the line of John Roy with Water Tower Research. Please go ahead.

Speaker #5: Thank you. Obviously, some things changed over the weekend. I was wondering if you could give us any kind of update on operations or outlook for the Middle East, given the Iran-US situation.

John Roy: Thank you. Obviously, some things changed over the weekend. I was wondering if you could give us any kinda update on operations or outlook for the Middle East given the Iran-US situation.

Jay Chandan: Mr. Roy, thank you for the question. First of all, to everybody who's listening and everybody out there, I am genuinely sorry to see what is happening. My heart really goes out to all the families caught up in this and to everyone who's lost their loved ones. I am feeling very, very sorry. I've got friends across both sides of the park. Now, from a business perspective, John, we are monitoring the situation very closely. As you know, we have a very disciplined risk posture. At this point, we're not seeing any material impact on any of our operations. Egypt is progressing at full flow. Our delivery continues against plan. Across the region, we can see, we're continuing to execute with a very appropriate caution, strong compliance, and very clear operational controls.

Speaker #1: Mr. Roy, thank you for the question. First of all, to everybody who's listening and everybody out there, I'm genuinely sorry to see what is happening.

Speaker #1: My heart really goes out to all the families caught up in this, and to everyone who's lost their loved ones. And I'm feeling very, very sorry.

Speaker #1: I've got friends across both sides of the pond. Now, from a business perspective, John, we are monitoring the situation very closely. And as you know, we have a very, very, very disciplined risk posture.

Speaker #1: At this point, we're not seeing any material impact on any of our operations. Egypt is progressing at full flow. Our delivery continues against plan.

Speaker #1: And across the region, we're continuing to execute with a very appropriate caution. Strong compliance and a very clear operational controls. Now, what we are watching for are very practical factors that matter.

Jay Chandan: Now, what we are watching for are very practical factors that matter. Logistic routes being one. Supplier lead times. Local security conditions. FX exposure. Collection cycles. Any regulatory changes that could affect movement of goods or personnel. If anything changes, the impact would likely show up on timing rather than demand. In that case, we will respond very quickly, protect delivery of our quality of our delivery. Update the market when there is something definitive to report. The trends, John, are in our favor, and it favor us very strongly, and they're accelerating, not slowing. I hope that answers your question.

Speaker #1: Logistic routes being one. Supplier lead times. Local security conditions. FX exposure. Collection cycles. Any regulatory changes that could affect movement of goods or personnel.

Speaker #1: If anything changes, the impact would likely show up on timing rather than demand. In that case, we will respond very quickly. Protect delivery of our quality of our delivery.

Speaker #1: Update the market when there is something definitive to report. But the trends, John, are in our favor. And this favor is very strong. And they're accelerating, not slowly.

Speaker #1: I hope that answers your question.

Speaker #4: Yes, it does. Actually, speaking of trends, and you obviously were talking about AI in India, can you give us maybe take a step back and look at the macro AI environment and what do you see happening out there in general?

Rachel Smith: Yes, it does. Actually, speaking of trends, you obviously was talking about AI in India, can you give us maybe Take a step back and look at the macro AI environment and what do you see happening out there in general?

John Roy: Yes, it does. Actually, speaking of trends, you obviously was talking about AI in India, can you give us maybe Take a step back and look at the macro AI environment and what do you see happening out there in general?

Speaker #1: Sure. Now, that's actually a good question. I think a lot of people keep asking me, and I've been speaking about this at various events as well.

Jay Chandan: Sure. Now, that's actually a good question. I think a lot of people keep asking me, and I've been speaking about this at various events as well. I would divide this into what I call three different trends, John. First one, in no order, right? AI is currently becoming national and a regulated infrastructure. If you look at governments, telecom operators, regulated enterprises, they're all treating AI compute as strategic capacity tied to their sovereignty, their data residency, compliance, and critical services. Now, that shifts demand from optional pilots to what I call budgeted programs with long duration and intent. Think about... Look at Asia. They are rapidly drawing up their charts now and thinking, we don't want to fall behind. Now they're coming up with large budgets, but more importantly, they have long duration intents, as I've mentioned.

Speaker #1: I would divide this into what I call three different trends. John, first one, in no order, right? AI is currently becoming national and a regulated infrastructure.

Speaker #1: If you look at governments, telecom operators, regulated enterprises, they're all treating AI compute as strategic capacity tied to their sovereignty, their data residency, compliance, and critical services.

Speaker #1: Now, that shifts demand from optional pilots to what I call budgeted programs with long duration and intent. So think about—look at Asia. They are rapidly drawing up their charts now and thinking, 'We don't want to fall behind.' And so now they're coming up with large budgets but, more importantly, they are long-duration intents, as I've mentioned.

Speaker #1: Now, the second side to that was the center of gravity, and this is very, very important. Again, I don't know why I'm stressing this, but I will stress this to you again.

Jay Chandan: The second side to that is the center of gravity, and this is very, very important. Again, I don't know why I'm stressing this, but I will stress you this again. Market is getting this wrong completely. People are talking about, is market going to sustain the investment into AI? I mean, the companies are investing hundreds of billions of dollars in the US and in China. The center of gravity is moving from training to inference and from inference to distributed inference. Training is very lumpy, okay? Inference is very persistent. You need to take that. I think most people on this call, I'm happy for you to take this message. Training is very lumpy.

Speaker #1: Market is getting this wrong completely. It's all people are talking about, "Oh, is the market going to sustain the investment into AI?" I mean, the companies are investing hundreds of billions of dollars in the US.

Speaker #1: And in China. The center of gravity is moving from training to inference. And from inference to distributed inference. Training is very lumpy. Okay? Inference is very persistent.

Speaker #1: You need to take I think most people on this call, I'm happy for you to take this message. Training is very lumpy. Inference, at the same time, is persistent, which means as the inference moves into everyday workflows, your compute demand spreads across regional hubs and closer to the data source.

Jay Chandan: Inference, at the same time, is persistent, which means as the in-inference moves into everyday workflows, your compute demand spreads across regional hubs and closer to the data source, which drives out more build of regional data centers. It is not going to slow down. It is only going to go up exponentially. That brings me to my third, you know, trend, which is Edge. Now, Edge is expanding the addressable market dramatically. Edge brings AI to the decision point where latency, privacy, and resiliency all matter. What happens now? It accelerates the adoption across public safety, as I mentioned previously, transportation, telecom networks, logistics, industrial operations, and so on and so forth. These things do not replace data centers. It multiplies them. Once again, it multiplies them by creating more endpoints that read absolute regional capacity and orchestration. Think about it this way.

Speaker #1: Which drives out more build of regional data centers. It is not going to slow down. It is only going to go up exponentially. And that brings me to my third trend, which is edge.

Speaker #1: Now, edge is expanding the addressable market dramatically. Edge brings AI to the decision point where latency and privacy and resiliency all matter. So what happens now?

Speaker #1: It accelerates the adoption across public safety as I've mentioned previously, transportation, telecom networks, logistics, industrial operations, and so on and so forth. These things do not replace data centers.

Speaker #1: It multiplies them. Once again, it multiplies them. By creating more endpoints, that absolute regional capacity and orchestration. So think about it this way: in the future, you're going to find a lot more, what I call, distributed inference points, which will create a huge requirement of regional capacity.

Jay Chandan: In the future, you're going to find a lot more, what I call distributed inference points, which will create a huge requirement of regional capacity. That's why you'll see the likes of, you know, OpenAI or Meta or Google or anybody else in the market. They are moving across a distributed environment. Those trends favor us very strongly. They're only accelerating, John. They're not slowing down at all.

Speaker #1: And that's why if you'll see the likes of OpenAI or Meta or Google or anybody else in the market, they are moving across a distributed environment.

Speaker #1: And those trends favor us very strongly. And they're only accelerating, John. They're not slowing down at all.

Speaker #4: Thank you. Excellent. Thank you so much for the color.

Rachel Smith: Excellent. Thank you so much for the color.

John Roy: Excellent. Thank you so much for the color.

Speaker #1: Sure.

Jay Chandan: Sure.

Speaker #5: If you would like to ask a question, please press star one on your telephone keypad. Your next question comes from the line of Barrett Boone with Red Chip.

Kristen: If you would like to ask a question, please press star one on your telephone keypad. Your next question comes from the line of Barrett Boone with RedChip. Please go ahead.

Operator: If you would like to ask a question, please press star one on your telephone keypad. Your next question comes from the line of Barrett Boone with RedChip. Please go ahead.

Speaker #5: Please go ahead.

Barrett Boone: Jay and Bruce, congratulations on a transformative 2025. I just had one question regarding Quantum Safe Networks and your SD-WAN product. Can you share some concrete milestones that investors can look for?

Speaker #6: Jay and Bruce, congratulations on a transformative 2025. I just had one question regarding quantum safe networks and your SD-WAN product. Can you share some concrete milestones that investors can look for?

Speaker #1: Sure. See, as I've mentioned previously, we have actually created a very strong product. And we've already tested it very effectively in the last few months.

Jay Chandan: Sure. See, as I've mentioned previously, we have actually created a very strong product, and we've already tested it very effectively in the last few months. Raja's team is very confident that they'll be able to launch it by end of April 2026. Just to give you know, when we deploy AI infrastructure, we're not just dropping GPUs in the room. We're talking about secure connectivity, telemetry, orchestration, and compliance layers, okay? These are very key important. People need to understand we're not selling hardware or we're not renting hardware. We're providing a service. That means your SD-WAN plus your Quantum Safe encryption allows us to control the network edge to the core very securely. That increases for us the solution value and improves the margin mix. That's number one. Second, our quantum solutions. Why?

Speaker #1: Rajesh's team is very confident that they will be able to launch it by end of April 2026. Now, just to give you when we AI infrastructure, we're not just dropping GPUs into the room.

Speaker #1: We're talking about secure connectivity. Telemetry. Orchestration. And compliance layers. Okay? These are very, very key important people need to understand we're not selling hardware or we're not renting hardware.

Speaker #1: We're providing a service. That means your SD-WAN plus your quantum safe encryption allows us to control the network edge to the core very securely.

Speaker #1: That increases for us the solution value and improves the margin mix. That's number one. Second, our quantum solutions—and why people are like, 'Oh, they're just going after it because it has the word quantum.' No, we're not.

Jay Chandan: Why is the people be like, Oh, they're just going after it because it has the word quantum? No, we're not. People who think that are idiots. They make Edge AI viable. Why? Because Edge compute only works at scale if connectivity is intelligent and, more importantly, secure. What does SD-WAN do? What does our post-quantum SD-WAN do? It gives us traffic optimization. It allows segmentation and performance control. Now, post-quantum, you know, crypto future-proofs the transport layer. Once we built the transport layer, it will help future-proof that. Together with the distributed AI architecture, which we just responded to, it makes these architectures deployable both in a national and an enterprise environment. Now, what does that make us?

Speaker #1: People think that they are idiots. They make edge AI viable. Why? Because edge compute only works at scale. Its connectivity is intelligent. And, more importantly, secure.

Speaker #1: So what does SD-WAN do? What does our post-quantum SD-WAN do? It gives us traffic optimization. It allows segmentation and performance control. Now, post-quantum crypto future-proofs the transport layer.

Speaker #1: So once you build the transport layer, it will help future-proof that. And together with the distributed AI architecture, which we just responded to, it makes these architectures deployable both in a national and an enterprise environment.

Speaker #1: Now, what does that make us? I think that was probably where you were headed towards with your question. They do not position us as a rent or a compute for rent.

Jay Chandan: I think that was probably where you were headed towards with your question. They do not position us as a rent or a compute for rent kind of a provider. It positions us as a trusted operator. That means we can design sovereign grade, Quantum Safe, policy compliant AI network. More importantly, we can help these GPUs generate additional revenue, secure the networks that protect it, and more importantly, our SD-WAN makes sure that neither falls apart when it gets more complicated. When the world gets more complicated like we are in today, we make sure that our SD-WAN and our quantum does not fall apart. Barrett.

Speaker #1: Kind of a provider. It positions us as a trusted operator. That means we can design sovereign-grade quantum safe policy-compliant AI network. And more importantly, we can help these GPUs generate additional revenue secure the networks that protect it.

Speaker #1: And more importantly, our SD-WAN makes sure that neither falls apart when we get more complicated when the world gets more complicated like we are in today.

Speaker #1: We make sure that our SD-WAN and our quantum does not fall apart. Barrett.

Barrett Boone: Thank you. That's very helpful. Congratulations again.

Speaker #4: Thank you. That's very helpful. And congratulations again.

Speaker #1: Thank you, Barrett.

Jay Chandan: Thank you, Barrett.

Kristen: This concludes the question and answer session. I would like to turn the conference back over to management for any closing remarks.

Operator: This concludes the question and answer session. I would like to turn the conference back over to management for any closing remarks.

Speaker #5: This concludes the question and answer session. I would like to turn the conference back over to management for any closing remarks.

Jay Chandan: Thank you very much, Crystal. That was really helpful. Some very insightful questions. Some caught me off guard as well, which is interesting. To all our investors, to our analysts, and every person who's supporting Gorilla, you know, first of all, thank you. You have trusted me, us, and the entire Gorilla team long enough to let results replace speculation. Okay? There are people out there who say our contracts are garbage, our numbers are garbage. That's okay. It's speculation. We are building the AI infrastructure that governments and critical industries will rely on, we intend to execute with discipline. To everybody who knows me, they know me as someone who will execute with discipline. What I will do is thank every single one of you, and I will stop here and hand over before my tea gets cold.

Speaker #1: Thank you very much, Krista. That was really helpful. Some very insightful questions—some caught me off guard as well, which is interesting. But to all our investors, to our analysts, and every person who's supporting Gorilla, first of all, thank you.

Speaker #1: You have trusted me and the entire Gorilla team long enough to let results replace speculation. Okay? There are people out there who say our contracts are garbage.

Speaker #1: Our numbers are garbage. That's okay. It's speculation. We are building the AI infrastructure that governments and critical industries will rely on, and we intend to execute with discipline.

Speaker #1: To everybody who knows me, they know me as someone who will execute with discipline. So what I will do is thank every single one of you, and I will stop here and hand over before my tea gets cold.

Speaker #1: It's 5:00 a.m.—actually, 5:25. And that would be a genuine crisis for me. Thank you, everybody. Have a lovely day, Ed.

Jay Chandan: It's 5:00 AM, actually 5:25 AM, that would be a genuine crisis for me. Thank you, everybody. Have a lovely day ahead.

Kristen: Ladies and gentlemen, this does conclude today's conference call. Thank you for your participation. You may now disconnect.

Operator: Ladies and gentlemen, this does conclude today's conference call. Thank you for your participation. You may now disconnect.

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