WISeKey International Holding Ltd - ADR Stock

Greetings, ladies and gentlemen, and welcome to the WISeKey International Holdings First Half 2026 Financial Earnings Conference Call. As a reminder, this conference call contains forward-looking statements. Such statements involve certain known and unknown risks, uncertainties and other factors, which could cause actual results financial condition, performance or achievements of WISeKey International Holdings LTD to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.

WISeKey is providing this communication as of this date and does not undertake to update any forward-looking statements contained herein as a result of new information, future events or otherwise. [Operator Instructions] As a reminder, this conference is being recorded.

It's now my pleasure to introduce Carlos Moreira, Founder and Chief Executive Officer of WISeKey. Mr. Moreira, please go ahead.

Thank you very much, and thank you all for joining us this morning. I am joined today by our group CFO, John O'Hara. With that, the first half of 2026 was a period of meaningful progress for WISeKey. We continue to improve our financial performance while advancing key strategic priorities, including the commercialization of our post-quantum semiconductor technology, the expansion of our Quantum technology strategy under development of our secure space infrastructure platform.

We also continue to refine our corporate structure to provide investors with greater visibility into the value and growth potential of our technology businesses. For the first 6 months of 2026, preliminary [ united ] revenue increased approximately by 116% to approximately $11.4 million compared to $5.3 million in the first half of 2025. Gross profit increased 192% to $5.5 million and gross margin expected to approximately 48% compared with 35% in the prior year period. This result reflected improved product mix as well as the increasing contribution of our semiconductor, engineering and related technology capabilities.

At June 30, we had approximately $495 million in cash and restricted cash with minimal debt. This gives WISeKey an unusually strong financial foundation from which to execute our long-term strategy, commercializing post Quantum technology, building severing semiconductors on our security capabilities, developing quantum platform, expanding trusted digital identities and advancing in secure space infrastructure.

We have built this technology and investment over many years in 2026, they are increasingly coming together as one commercial ecosystem. Our priorities are clear and measurable which are [indiscernible] the CLC commercial pipeline into recognized revenue, move post quantum semiconductor products from qualification and certification towards volume production, complete our planned corporation -- corporate structure initiatives, including the WISeKey redomicilation and the proposed WISeSaT and Quantismo transactions, continue expanding serving semiconductor, cybersecurity and trust and infrastructure capability in key jurisdictions, build value across our technology platforms while maintaining a common route of trust. We will provide more details on each of these areas shortly.

Before doing that, I will ask John to provide an overview of our first half financial performance. I will then return to discuss the strategic progress and outlook.

John, please go ahead.

Thank you, Carlos, and good morning, everybody. As Carlos noted, preliminary unaudited revenue for the first half of 2026 was $11.4 million an increase of 116% from $5.3 million in the first half of 2025. This stems from the revenue increase of our core semiconductor and PKI product lines, the first revenues relating to the Quantix Edge project, and the consolidation of 6 months revenue by [indiscernible] and 1 month revenue of [ Mirox ] and [ WeCan ] Group SA, both acquired on first June 2026.

Gross profit increased 192% to $5.5 million compared with $1.9 million in the prior year period. Gross margin expanded to approximately 48% from approximately 35% in the first half of 2025. The gross margin improvement reflects changes in revenue mix and the growing contribution from higher-value technology, semiconductor and engineering activities. We will continue to focus on the opportunities that can support revenue growth while improving the quality and scalability of the group's revenue base over time.

Operating loss for the first half was $40.9 million compared to $27.3 million in the first half of 2025. Net loss was GBP 36.4 million compared with $22.3 million in the prior year period. Of note, in H1 2026, the group recorded R&D expenses of $9.1 million net of stock-based compensation showing an increase by $5.1 million in comparison with the $4 million net of stock-based compensation for the 6 months ended June 30, 2025. The increase was primarily attributable to the consolidation of the results of ICAP acquired in August 2025 with $4 million R&D expenses.

Additionally, approximately $1 million of R&D expenses related to group-wide intangible asset amortization, substantially all of which relates to intangible assets recognized in the [indiscernible] and ICR transactions. The increase in operating and net losses principally reflects the investments we are making across the group's strategic platforms, including post-quantum semiconductors, quantum technologies, secure infrastructure, satellite initiatives, product development, certification, engineering and planned corporate transactions. At June 30, 2026, WISeKey had approximately $495 million in cash and restricted cash and minimal debt. This liquidity position gives us the flexibility to continue investing with a long-term perspective while also pursuing strategic opportunities across the group. It supports our ability to fund commercialization, product development, certification, infrastructure initiatives and selective acquisitions without relying on short-term financing needs.

Turning to our guidance. WISeKey reaffirms its expectation for full year 2026 revenue growth of 50% to 100% compared with 2025. This outlook reflects our current expectations regarding the timing and execution of existing programs, semiconductor and ASIC design activity, digital identity and PKI services, sovereign infrastructure initiatives and the initial commercialization of our post-quantum product portfolio.

As always, this guidance is subject to risks and uncertainties described in our public filings, including customer timing, certification, production schedules, market conditions and the conversion of commercial opportunities into recognized revenue.

I will now turn the call back to Carlos. Thank you, Carlos.

Thank you, John. I would like to spend the remainder of my prepared remarks discussing the 4 strategic areas that define our next phase of development.

Number one, the post-quantum Semiconductor commercialization for SEALSQ. Number two, [indiscernible] Quantum, sovereign vertical stack and the planned Quantisimon platform. Number three, WISeSaT and the [indiscernible] Orbital cloud; number four, our corporate structure and Capital market initiatives, including the expected WISeKey direct listing.

Starting with post-quantum commercialization, SEALSQ remains the technology foundation of the WISeKey Group during 2026. SEALSQ continue advancing the QS7001 post-quantum secure element and the QoL TPM product line through important validation, security testing and customer engagement stage. The QS7001 achieved NIST SP890B and tropisource validation, an important step towards the [ FIP140Slat3 ] and common criteria EAL5+certification. We also completed common criteria, fault injection and side channel resistant testing, engineering samples of the Qvalt-TPM are now available to customers. Separately, SEALSQ received 640 minus 3 Level 3 validation for its [ VolTAC408 ] secure element. These achievements matter because the transition towards quantum-resistant cryptography is no longer a distant theoretical issue, government enterprises and critical infrastructure operators are beginning to prepare for migration to post-quantum security architecture. This is creating what we believe will be a multiyear commercial opportunity for secure Semiconductor, trusted identity, hardware security model PKI and related infrastructure.

As of June 30, more than 150 customers and prospects we're engaging with SEALSQ post-quantum technology more than 30, we're actively evaluating or integrating QS7001 and Qvalt-TPM. As of September 22, SEALSQ commercial pipeline exceeded $225 million through 2029, more than $100 million of that pipeline is associated with post-quantum projects, including QS7001 and Qvalt-TPM opportunities. We want to be clear that this pipeline represents our estimate of potential commercial opportunity. It's not revenue and its conversion will depend on customer qualification, product validation, certification, production schedules, integration and other commercial factors. However, the pipeline provides an important indication of the level of customer engagement and the market opportunity that we are pursuing. We expect initial production revenue from QS7001 and Qvalt-TPM in the fourth quarter of 2026, with larger contribution expected to begin in 2027, subject to the normal risks associated with production ramp-up and customer deployment.

Moving on to SEAL Quantum and Quantisimom. We also continue building the SEAL Quantum sovereign vertical stack, which is designed to create an integrated technology architecture spanning from cryptographic route of trust and post-quantum semiconductor through photonics, quantum computer, computing and secure infrastructure. The strategy is to support by a targeted allocation of $200 million of SEALSQ internal capital resources. During the year, SEALSQ completed its acquisition of [indiscernible] in Switzerland adding Quantum Photonics interconnect technology to the stack. SEALSQ also made a lead investment of approximately $50 million in [indiscernible] under the $150 million Series A financing and subsequently entered into a 5 million commercial agreement with [indiscernible].

In addition, SEALSQ has invested a total of $7 million in Iraq, a U.S.-based quantum computing company, a media majority investment in [indiscernible] Group through weekend, we are working to advance the next generation of the copilot compliance solution and explore the integration of post-quantum financial secure capabilities. Together, these assets complement WISeKey and SEALSQ on semiconductor, PKI, digital identity and trusted infrastructure capabilities.

The WISeKey Quantum route is a central element of this strategy. It extends the route of trust that WISeKey has operated under the [indiscernible] Foundation governance model since 1999 into the post-quantum and quantum computer era. We are integrating this common quantum-resistant trust layer across the SEAL quantum ecosystem from chips to qubits.

In June WISeKey and SEALSQ established Quantico group and signed a nonbinding letter of intent with GigCapital aid regarding a potential business combination intended to create a NASDA-listed Quantum technology company Quantisimo is designed to combine selected technology and investment developed through the SEAL Quantum ecosystem into a focused platform covering quantum computing, Photonics, Quantum Secure infrastructure, Quantum pure-play and related technology.

The proposed transaction remains subject to definitive agreements, regulatory review, shareholder approval and customary closing conditions. We currently target completion of the first quarter of 2027, subject to the satisfaction of those conditions. Now let's discuss WISeSaT and [indiscernible] our secure space strategy also continues to advance. WISeSaT is progressing towards becoming an independent listed space technology company through its proposed business combination with Columbus Acquisition Corporation. The transaction is expected to result in a NASDAQ listed company subject to completion of the transaction and all requirements approval and closing.

At the international Space [indiscernible] in Paris early this month, WISeKey, SEALSQ and WISeSaT [indiscernible] combined commercial quantum Special Orbit Cloud or [indiscernible] initiative. [indiscernible] is intended to combine the WISeSaT satellite constellation with SEALSQ post-quantum semiconductors, PKI and Quantum runned a number generation and digital identity technology. The objective is to create a secure and sovereign orbital infrastructure serving governments, defense organization, financial institution, critical infrastructure and enterprises. The current road map contemplates a progressive deployment of up to 100 satellites through 2033.

The platform is designed to support secure communication, Quantum generated trust and post-quantum identity services. The initiatives demonstrate how our technology platforms can reinforce one another WISeSaT provides the satellite infrastructure. SEALSQ provides the quantum resistant security hardware. WISeKey contributes digital identity, PKI and route of trust, Together, they support a different shaded secure space architecture. We are focusing on building a sovereign infrastructure. As we have announced via our news releases we have made substantial progress in building sovereign post-quantum semiconductors and cybersecurity capabilities in Europe and the United States.

Just a couple of weeks WISeKey, SEALSQ and the Republic of Canton of Jura in Switzerland, signed a memorandum of understanding to work to get it to a proposed both Quantum Semiconductor and cybersecurity center in the Canton of Jura, Switzerland. The initiative has an indicated investment of approximately $40 million to $60 million over 6 years. It is intended to provide Switzerland capabilities to design, personalize, test and securely provision next-generation post-quantum semiconductors, beginning with the QS7001 [indiscernible]

The project is designed to create a skill employment, support Swiss technologies Sovereignty and strengthen their regional ecosystem around secure semiconductor and cybersecurity practices. The [indiscernible] initiative builds on our Quantix a project in Musa, Spain announced in several locations where WISeKey and SEALSQ are developing sovereign semiconductor, design personalization and cybersecurity capabilities.

We view Murcia and Jura an important hub for the WISeKey and SEALSQ quantum highway linking trusted infrastructure capability across regions. We are also establishing the quantum -- Geneva Quantum Center of Excellence at our headquarters in Pon Rouge in Geneva. The center is intended to provide an end-to-end demonstration environment for customers, government, technology partners, regulators and investments. It will bring together our quantum computer post-quantum server security, semiconductors, digital identity satellite, robotics and artificial intelligence technology in one physical environment. This will help demonstrate how the components of our ecosystem work together in practical use cases.

Moving on to our corporate structure. Finally, we have made important progress, though we're simplifying our corporate structure and strengthening access to the U.S. and international capital market. On September 9, shareholders approved the redomiciliation of WISeKey holding company from Switzerland to the bridging British Virgin Islands, along with the related merch agreement, the new parting company has been renamed WISeKey, with QE corporation Westgate, as the news release issued this morning, there is redomiciliation become legally effective today.

WISeKey ordinary shares are expected to become trading directly on the NASDAQ global market under 6 Swiss exchange on or about October 5, under the ticket WKEY, which with 6 expected to remain the primary listing. This structure is intended to streamline our U.S. capital market presence by replacing the existing ADS structure with ordinary shares trading directly on the NASDAQ.

While maintaining our Swiss operational headquarters, management presses and international footprint. Over time, the group intends to provide greater visibility, accountability and a strategic focus for each of its major technology platforms. WISeKey as the parting company overseen route of trust, PKI, a digital identity business SEALSQ as the post-quantum semiconductor and secure hardware platform, WISeSaT as the secure satellite and space technology platform subject to completion of its proposed transaction [indiscernible] as the potential quantum technology platform, subject to completion of its proposed transaction. The goal is to enable each business to proceed in specific market opportunities while maintaining the technology integration that differentiates the broader group.

Before opening the floor to questions, I would like to emphasize that WISeKey is building on a strong first half as we execute through the remaining of 2026 with solid revenue growth, a substantial liquidity position increasing engagement with our post-quantum product and meaningful strategic progress across semiconductor, Quantum technology, security space and sovereign infrastructure. We are now focusing on execution -- that means converting commercial opportunities into revenue, bringing post-quantum products into production, completing or transaction and corporate structure initiatives and continuing to demonstrate the value of the integrated trust infrastructure ecosystem we have built. From silicon to cubits from digital identity to artificial intelligence, from earth to space our objective remains unchanged to provide the root of trials for the next generation of the digital economy.

Thank you for your time and interest in WISeKey. Operator, we are now ready to open the call for questions.

[Operator Instructions] Our first question today is coming from Matthew Galinko from Maxim Group.

First one is on the pipeline for repeating what you've done with Quantix Edge is signing and progressing on that agreement, a helpful validation point as you negotiate in other regions to bring additional of those types of programs to fruition?

Yes. Matt, nice to talk to you. Yes, absolutely. I mean the concept of creating those personalization center, it was a very early concept that actually started even before all the current discussion about sovereign technology and the fact that countries want to control the entire supply chain process of basically manufacturing and, in some cases, personalizing semiconductors at national level, especially now with the post-quantum requirements, and they are coming.

So the first project in Murcia was -- it is a joint venture where we invested the Spanish government invested EUR 20 million and a local startup invest EUR 10 million. So this project is already generating revenue for us as they buy our technology, they our chips, they buy or machines we actually designed the clean room and all the process required to personalize the chips.

So this experiment that we didn't know how that will play is actually playing very well. And it's becoming inspirational for many other countries. And Jura is the next one. that they want to move into semiconductor. I mean what is happening many of these hubs like Jura Switzerland is very well known for being one of the watch manufacturing job hubs in the country. And obviously, watch manufacturing technology, it needs to be projected to the future. And the skill sets are there, but they need to enter into the digital era. And semiconductor is the normal extension of that. So that's why we signed with them. Similar projects are in preparation in the United States, we will be able to give more information in Q4 for the same reason, right, the United States wants to be also self-sustainable and independent in what concerns the next-generation secure semiconductors with post-quantum capability. Because this is now a requirement by the U.S. government on the PQC is an executive order on President Trump that says that critical infrastructure in the United States needs to be PQC-compliant and resilient by the year 2030.

So this is actually tomorrow. So we will very soon be able to announce progress in the United States on that initiative, which will be obviously much bigger than what [indiscernible] on [indiscernible] because the country is much bigger and the economy is much bigger. So yes, I mean investment in one side, creating a local infrastructure then becomes sovereign and that reinforces our trust model and allow us to sell more chips and more technology on a national level, which otherwise will be impossible to reach out because they will prefer to have a local player.

Got it. And as a follow-up to that question, and we've talked about this, I think, in the past, but you have a bigger balance sheet today than I think when you proposed the the Quantix project in Spain. So as you work towards bringing more of those sovereign type projects to fruition. Do you look to have a bigger economic interest in the projects now that you you could potentially put more capital in? Or is that not necessarily the direction you'd want to take with your investments?

Yes. Yes, absolutely. I mean as you know, many technology companies like NVIDIA and others, they are creating in some cases, the market for their own products by investing in centers like that, that applies the same -- the same logic apply for data centers, right, where companies invest in data centers with the objective to have the data center acquiring from the company. So the same thing applies to semiconductors. The fact that SEALSQ and Wake are sitting on a very important cash position, those projects are not that expensive. I mean we are talking between $40 million, $50 million per country. It would allow us to localize a few of those centers around the world, and we are also looking in South Korea. We are looking in Japan where we have a good track on the demand on semiconductors. And as soon as we enter into a full PQC era, which should be next year, there's going to be more and more demand for that. This is one of the reasons, by the way, I mean, as you know, WISeKey is trading at a very low valuation their enterprise value is very low. I mean the group has 10x more cash in the valuation in some cases.

So obviously, that will rectified as well the value of the group, right, as you will be consolidating the revenue generated by those entities. And this is one of the reasons as well where the WISeKey replacing the Key with the Q to reflect our commitment to Quantum Technologies and listing the company directly into the NASDAQ as a way to correct the historical limitation we had in Switzerland by being only a se-listed company with an ADR in the U.S. So all those actions that took a huge amount of effort by the company, the management and the staff is reaching our maturity, and this is going to create a very interesting scenario where this enterprise value will more and more being recognized by the market.

And if I could sneak one additional question in I think you highlighted interest in growing your constellation to 100 satellites. Can you maybe fill in a little bit on who you see as launch partners to get that out there. There's sufficient launch capacity in the coming years to build that sort of size of Constellation and just what are the dynamics you're seeing?

Yes. So we started 3 years ago, launching satellite, low orbit satellite. We did it with SpaceX, which is our predominant launcher. SpaceX is actually working with us strategically also as we are -- I mean this model of constellation is actually very interesting because it is both a sovereign constellation or on satellite. And at the same time, allow us to interconnect with existing satellite in other constellations, right? I mean, our position in the space is now to have thousands of satellites, but to make the existing satellite more secure, to render them [ PCC ] compliance to create national server in hubs where, for instance one country could use a number of satellite, which will be enough for them to coverage their own territory, but in a mixture between private constellation versus a public constellation like a sterling.

So we are also diversifying or launching projects by teaming with companies like Sky route in India, which they just launched their own Rocket or PLD is paying which is another rocket company. Those are a small company. Obviously, nothing to compare with the SpaceX. But in some cases, this industry -- space industry is becoming also very sovereign industry. And there might be situations where country will prefer to use their own launching capability. But our focus, again, is not sending rockets or not having thousands of satellite or our focus is actually to bring the cybersecurity that we have been implementing on earth for many years into the space. And this is where is ad and very soon to be a NASDAQ-listed company on its own right, is building that layer that is not operationally in our days. Current satellites have very little security. They are non-PQC client means that with a quantum attack, you can just shut down many of those satellites and create a huge disruption. So that's our focus. And there's going to be many strategic partners that they are slowly coming because they want to add their services to this type of secure satellite constellation that we are building.

Thank you. We reach the end of our question-and-answer session. I'd like to turn the floor back over for any further closing comments.

So thank you very much for your time. And if you have any other questions or information you can always email to us or go to our investor website, where you will find all the documents and presentations. And we would like to thank for your attention. The moderator also to organize this call. and the IR agency to put this in place. So thank you very much, and we look forward to be in contact with all of you very soon.

Thank you. That does conclude today's teleconference webcast. You may disconnect your line at this time, and have a wonderful day. We thank you for your participation today.

Ladies and gentlemen, thank you for your patience, and welcome to WISeKey International Holdings Full Year 2025 Financial Results Conference Call. As a reminder, this conference contains forward-looking statements. Such statements involve certain known and unknown risks, uncertainties and other factors that could cause actual results, financial condition, performance or achievement of WISeKeY International Holdings Limited to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.

WISeKey is providing this communication as of this date and does not undertake to update any forward-looking statements contained herein as a result of new information, future events or otherwise. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce Carlos Moreira, Founder and Chief Executive Officer of WISeKey. Thank you, sir. You may begin.

Good morning. Thank you very much to every -- and good morning to everybody.

So 2025 was a defining year for WISeKey and the early weeks of 2026 have already validated the strategic decision we made over the last 24 months. We delivered audited full year revenue of $19.3 million, representing a 62% growth year-over-year with a subsidiary SEALSQ contributing $18.3 million and growing 66% over the prior year. Q4 alone produced $8 million of that revenue.

More importantly, we ended 2025 with a fundamentally transformed balance sheet. We have over $429 million in cash and short-term investments at year-end, growing to more than $535 million as of April 30, following our March capital raise for CLS. This strong and well-capitalized balance sheet give us the ability to execute our strategy without compromise. I want to frame today discussions around 3 important messages.

First, the transition from a sampling to commercial revenue is now underway and the data points are concrete. Second, our strategy architecture, what we call the year of convergence is integrating 5 technology pillars into a single vertical integrated Quantum Secure platform. And third, the regulatory and geopolitical environment is moving decisively in our favor.

So starting with commercial inflation at SEALSQ. The 66% revenue growth SEALSQ delivered in 2025 reflects 2 distinct things happening simultaneously.

One, our legacy semiconductor and PKI product line saw a renewed demand cycle as customers work through their inventory positions. On the other hand, we generated our first revenue from sampling or post-quantum products, which is the leading indicator that matters more for the -- what comes next.

Today, our commercial pipeline at SEALSQ exceeds $200 million, covering potential revenue opportunities from 2026 through 2029. With that, more than $60 million is directly tied to QS7001 and QVault TPM programs, growing more than fivefold year-over-year from approximately $11 million.

On the certification side, QS7001 has now passed fault injection on side-channel attack resistance evaluation at the EAL5+level, and we have completed the NIST validation.

First production revenues are on track for 2026, late in 2026. This is again a gating event that converts pipeline into recurring hardware revenue, and we are tracking on schedule. Moving the year of conversion for WISeKey. We are calling 2026 a year of conversion because our 5 technology pillars; SEALSQ, WISeSaT, SEALCOIN, WISeID/INeS and WISe.ART are now operating as a single integrated stack rather than as a [indiscernible] business as it was the case until now.

What this means in practice is that our team -- our team in sharing knowledge and resources to create virtually integrated solutions for our customers. Our SEALSQ which developed post-quantum secure chip design to generate ASIC design services revenue, hardware revenue and recurring income through Outsourced Semiconductor Personalization and Test, OSPT Center has now entered in commercial acceleration phase, or WISeSaT we have made significant progress we have launched 21 satellites to date with 14 currently operational in low-earth orbit, and we remain on track towards the 100 satellite constellation.

The definitive business combination agreement we signed in November with Columbus Acquisition Corporation is expected to close in the second half of 2026, very likely around the month of September, which will result in WISeSaT space holding listing on the NASDAQ with a WISeKey and SEALSQ together receiving 25 million shares at $10 per share, representing a $250 million of equity value while retaining majority ownership.

This listing is the structural enabler of our Quantum Spatial Orbital Cloud, what we call the QSOC initiative. Under the QSOC, WISeSaT operates the space infrastructure and SEALSQ owns and operates the Quantum cloud as a managed subscription service. The full operational capability target is 2033, and WISeSaT is expected to operate a constellation provided a dedicated QSOC capability for SEALSQ and SEALSQ is aiming to deliver a contractual guarantee 99.9% uptime service agreement to its customer.

The SEALSQ Quantum Fund. I want to spend a moment on capital deployment to date. The SEALSQ Quantum Fund grew from $20 million at launch in 2025 to $200 million of available capital resources as of April 30, 2026. Through the end of April, we have deployed approximately $23.2 million across 5 portfolio position, which are, we invested $40 million in IC'ALPS. The acquisition added more than 100 ASIC engineers in Grenoble in France, and we are now developing our quantum resistance secure element optimized for CRYSTALS-Kyber, which are the standards for post-quantum technology.

We deployed $4.2 million in Quantix Edge Security project in Murcia, Spain, which is building one of the European first sovereign post-quantum semiconductor personalization center and test center co-founded by the Spanish SETT.ES, which is the government agency in charge of investment in critical infrastructure in Spain, program with $20 million that has been contributed by the Spanish government.

We invest another $4 million in weekend, which integrates our PQC-secure digital identity into financial KYC. We made 2 rounds of investment, EeroQ or Anchors U.S. Quantum Hardware investment in a company in Chicago, which brings electrons-on-helium quantum computer architecture, which is CMOS compatible with our chip processes.

So CMOS is the technology that we are investing on because it totally is aligned and fits with our semiconductor capabilities. We plan to demonstrate a joint Quantum security stack at recent Geneva Quantum Center of Excellence currently in preparation to be inaugurated in October this year.

Additionally, we made an initial small investment in ColibriTD, our French Quantum solver partner, which is working on improving sub-7nm wafer yields from 50% to 80% which directly reduces our chip manufacturing cost. Each of these investments reinforce the underlying business -- they are not adjusted debts. They are vertical integration required to move the company technology to the next level.

Finally, on the regulatory environment, the U.S. NSA CNSA 2.0 mandate by the U.S. government requires CNSA 2.0 compliant for all new national security system acquisitions by January 1, 2027 in the United States. This is now 8 months away. Federal agencies in the U.S. are required to identify and remediate quantum vulnerable system and the NIST PQC standards were finalized in 2024.

Our products are designed to comply with all these standards, and we are seeing this translate directly into pipeline activity in areas such as defense, smart meters, ecosystem through the [indiscernible] and U.S. federal procurement through the trusted semiconductor solution alliance partner. With that strategic context, let me hand the call over to John to walk you through the financials in details.

Thank you, Carlos, and good morning, everyone. So full year revenue for 2025, as Carlos has said, was $19.3 million, an increase of 63% (sic) [ 62% ] versus $11.9 million in 2024. Fourth quarter revenue was $8 million, which doubled from $4 million in the fourth quarter of 2024. Approximately $3.5 million of the full year increase relates to 5 months of revenue contribution from IC'ALPS, which we acquired through SEALSQ on August 4, 2025, and consolidated from that date forward.

Organic growth was driven by a recovery in our core secure microcontroller and PKI product families plus initial sampling revenue from our post-quantum platforms. I want to be transparent about how to think about 2025. As Carlos has already said, it is the year that paved the way for our convergence strategy. The 2025 numbers continue to reflect the transitional period between the traditional product offerings and next-generation post-quantum semiconductor platforms and included the first revenues from sampling and with the transitions expected to enter its commercialization phase with the first production revenues anticipated in the latter part of 2026.

The full year 2025 net loss was $38.2 million, which was due in a large part to $ 8.3 million of noncash share-based compensation, consolidation following the acquisition of IC'ALPS. Materially increased R&D investment we made to accelerate the post-quantum semiconductor product range and the expanded sales and marketing-related expenses made has brought the expected commercial ramp, which then were partially offset by a one-off credit on the settlement of the ex-work flow and by interest income on cash deposits.

On the balance sheet side, as of December 31, 2025, WISeKey had $429 million in cash and short-term investments, up from $91 million at the end of 2024, an increase of 370%. This was achieved while deploying $23 million during the year towards strategic investments in weekend IC'ALPS Quantix Edge security and others that Carlos has already touched on.

In March 2026, SEALSQ raised a further $125 million in additional capital. As of April 30, the WISeKey Group had over $535 million in cash and short-term investments. This strong cash position allows us to fund post-quantum R&D, scale our manufacturing capacity, pursue selective M&A and continue to deploy through the SEALSQ Quantum fund.

Moving on to guidance. We are reaffirming our full year 2026 revenue guidance, which calls for growth of 50% to 100% year-over-year driven primarily by SEALSQ. We have some significant projects in relatively advanced phases of negotiation. And we therefore hope to be able to positively reinforce and upgrade our guidance in the coming months. The drivers of this are full year consolidation of IC'ALPS, broader entry into the trusted platform module market by QVault TPM, the launch of QASIC, custom post-quantum ASIC engagements, initial QS7001 production revenues following the EAL 5+certification in late 2026.

Initial revenue is expected from the Quantix Edge Security personalization center development in Spain and continued expansion of recurring PKI subscription and OSPT personalization revenues. With that, I'll hand back to Carlos for closing remarks before we open the line for questions.

So thank you, John. And before we move into our Q&A, let me close with a brief view on what we expect to see through the remaining of 2026, that has not been yet disclosed during the first part of this meeting.

So as we say, the QS 7001, the EAL 5+ certification is on track. We expect to generate the first production revenue in the latest part of this year. It is important to note that this is the first type of chip that are certified with that level of security. And although this is not a requirement to sell because we can sell them without that certification, that certification will help to increase the revenue, especially in government contracts and critical infrastructure projects.

Second, we expect the WISeSaT business combination of Columbus Acquisition Corporation to close in the second half of 2026, creating an independent listed company in WISeSat.Space Holding Corporation, as you all know, with the IPO of the SpaceX, space is becoming a very important infrastructure as many of the current earth based infrastructure such as data centers, nodes are moving to the space and it's critical for a company like WISeKey via its subsidiary WISeSaT to have an early presence in that ecosystem, which will be a very important growth ecosystem in the future, so everything is moving to what we call Quantum Internet.

And we're having assets related to satellite, launching capabilities in cooperation with the Space X, cryptographic capabilities to store at the satellite and the future possibility to do quantum key distribution for space are strategic components for companies like WISeKey and WISeSaT.

There, we state continued capital deployment from the SEALSQ Quantum fund into vertical integrated R&D partnership as the company is sitting in a very important cash position it is essential that we use this unique opportunity to build up infrastructure both in the United States and Europe, and that will include investments, important investments in areas such as personalization center, which are capital intensive -- and this is one of the main reasons why the company has raised important funding during 2020 -- last year and this year, with a total incremental cash position of $500 million, over $500 million, of which $200 million are allocated for this quantum fund.

Fourth, we expect to report concrete commercial milestone from several partnerships we have established with reputable customer and business partner that will accelerate our revenue, particularly in the United States in announcements that will be made during the second half of the year. And fifth, the reallocation of WISeKey and SEALSQ to Pont-Rouge, Lancy facility in Geneva should be completed in the second half of 2026, which is a much larger facility than the one we have now, and will allow us to establish the Geneva Quantum Center of Excellence in cooperation with leading organizations in Geneva, such as [indiscernible] United Nations, the Geneva government and others, then they are all working in accelerating the adaptation of quantum technologies into sectors such as financial sectors and others.

The Quantum threat to today's encrypted infrastructure is mathematically certain and approaching rapidly as the latest announcements made by Google and other, NVIDIA and others that they are confirming that Q-Day could be as near as 2028, 2030. The companies that will lead the post-quantum era will be those that combine server and silicon trusted identity, secure satellite key distribution and quantum resistant transaction infrastructure into a single integrated platform. That is what WISeKey is building and it's all about. That is what we are now monetizing.

So I give now the operator to open the Q&A part of this call. Thank you very much for your attention.

[Operator Instructions]

Our first question is from Matthew Galinko with Maxim Group.

Maybe to start with, on the pipeline you're seeing for quantum chips, I think you said it's about $60 million from '26 to '29. How much of that would you say is driven by regulation and how much is just independent of regulatory-driven requirements.

So maybe I'll let John to further explain, but thank you, Matt, by the way, and I see back to you again. So the regulation, obviously, the CNSA 2.0 is of concern to any one qubits that is conducting critical infrastructure; imagine hyperscaler, imagine data centers, imagine space satellite, I mean everything will be compromisable in terms of security because quantum computer will be breaking RSA keys. Obviously, we are not yet there. Quantum computers will need something like 10 million qubits to do that. But the new is a lot of R&D and a lot of innovation in the Quantum area where companies are already in the process of being able to generate 10-qubits and the new thing is that you can put those qubits also in a serial process, so you can combine qubits from different companies and bring them into a data center and use them in a scaling process to generate enough qubits to make a substantial usage of those decentralized quantum computers. It's something like we call Quantum as a service.

So that growth of compute capability and possibility of using Quantum computers to break RSA. Obviously, that's not the main focus of quantum computer, Quantum computer can do many good things, but this is a bad thing that they could do, right? This is making a lot of companies conscious about the risk. This is also increasing their potential insurance policies.

So they know that they need to be ready to that day. So we are working with integrators, for instance, that they are now adding PQC security as part of the contracts they have with thousands of companies and they want to expand the current security services they get from those professional service companies to add both PQC defense capability and also, in some cases, also a space security as many of these companies are now launching satellites and they want to use satellite constellations to access their data.

So there is a trend that is moved both by innovation in the market. It is also moved by government regulatory and this is not only in America. We have the similar regulations now in Europe and also going to be the same thing in Asia, in Singapore and India.

And I think by the year 2030, qubits that runs a critical infrastructure will be PQC compliant.

So they will have to buy the chips that allow them at the object level to defend a quantum attack. There is also PQC software, which is at the back-end level. So those are -- we are working also with partners to provide that technology that will allow, for instance, to assess the vulnerabilities of a financial institution if a quantum computer arrives. So those are also partnership with a professional services company, that they will work with us to teach potential risk to those companies if they don't apply post-quantum capabilities as soon as possible.

So it is a trend. I mean, it's like putting the airbag in the car, right? You needed a time, now it's compulsory. Nobody thinks about it. That's happening the same from the year 2030, you will not conceive the possibility of developing anything, which is potentially breakable through a Quantum attack.

That's great color. And I think you sort of started on this, but maybe beyond kind of the regulation you referenced, where else regionally are you seeing movement towards those sorts of requirements for Quantum or PQC capable chips and security?

So sorry, if you don't mind asking the question again. I didn't get the first part?

Sure. So I'm curious where else in the world that you're seeing regulation emerge to mandate quantum secure technology on critical infrastructure?

So as I mentioned, the CNSA 2.0 is the reference. This is a U.S. government, right? -- that says that 2028, you need to be protected against Quantum attack through a post-quantum capability. Otherwise, your technology might be considered legacy. So imagine qubits selling anything to the U.S. government, they will need to be PQC compliant. Otherwise, they will not just buy your product. That will also affect import products. So imagine a video camera, imagine cars, imagine drones, imaging satellite equipment, imagine Cisco routers, all that with our PQC capabilities will not be able to be deployed on critical infrastructure and critical infrastructure, obviously, airports, smart cities, government entities are the first one that needs to be secure.

So this is a must-to-have type of first line of defense. Then you have obviously the commercial opportunities of this. I mean if you have -- we just announced a deal with Parrot. Parrot is one of the leading drone companies in the world, one of the first one, by the way, and Parrot is being used now in many battlefield type of activities. As you know, the drone industry has evolved enormously and the founder of Parrot recognized that he wanted to be the first drone company to have all QS7001 installed physically into the drone.

So we did it. And obviously, we announced it. And this is now being used as a case study on any other drone company, then they want to have their drone PQC compliant. Imagine the consequence of having a drone that is not secured to that level, right? So that will be in industries like the health industry, where we have, for instance, PQC deployments with connected devices that they are using hospital you can ensure that your pump insulin and connects to the Internet cannot be breakable through an external attack.

So the quantum computers are so powerful that they could make a massive attack into billions of devices in 1 shot. And they will detect the vulnerability of those devices. As it is the case now with AI, right? I mean there's a lot of discussions about what is happening with some AI companies without mentioning them, that they have now capabilities to identify cybersecurity vulnerabilities very easily. And imagine if that is used in the wrong hands, right? So we are in a very similar situation with Quantum Computer.

So PQC is the line of defense of Quantum, but also the company because we are investing in Quantum companies like we invested in EeroQ, which is a Chicago-based company, where we are working very closely with them. to develop semiconductors, then they will be able to basically create a quantum computer. So we are also learning from innovation in Quantum in order to create basically what we call a sovereign quantum computer. A quantum computer then will be able not to be used to destroy the security of critical infrastructure, but it could be used to solve major problems like discovering a new medical product. For instance, with less than 10 qubits, we can now work with pharmaceutical companies to develop a new drug and put that into the market much faster than without having that compute capability.

So it is a very emerging market where you will see a combination between Quantum security, quantum computer deployment, hybrid combinations where you are using Quantum Computers and supercomputers at the same time as supercomputers are not going to disappear, right? It will take a time between now and maybe 10 years where Quantum computers will totally displace supercomputers, but this is -- we have still a few years to go, where you might have a hybrid platform solutions.

So the big opportunity to WISeKey is that WISeKey has all those critical assets through SEALSQ, what concerns chips in WISeSaT, what concerns the space constellation with operational satellite in WISeID, what confirms identity management and the possibility of injecting digital identity into the silicon directly with a Cryptographic Root of Trust, so all these ecosystem of companies that have been created under the WISeKey is making WISeKey a very unique company, very hard to replicate it and extraordinary important for the next generation of Quantum Computing that is going to emerge.

As you will need to have an end to end. And then at the same time, you need to provide a sovereign structure. Another important aspect here is that many companies will prefer to buy a solution of SEALSQ in the U.S.A. because they don't want to buy a Chinese quantum computer, for instance, because there will be concern about what is the process of that quantum computer. And who has done it and what is the cryptographic capabilities, what is the trust model and so on. So quantum computing industry is becoming sovereign and this is a big opportunity for us.

And just one final question for me, particularly on the satellite business. I'm wondering if you could share anything about where you're hearing or seeing demand for services delivered through the constellation that you're building. Is there a pull on the services that you're demonstrating now? And -- or do you -- is it a push or kind of talk about how that is developing commercially.

Yes. So the constellation, we -- WISeSaT, which is a company owned by WISeKey, initially invested in sending with SpaceX 2021 satellites with those are picosatellites, that's the free-use satellites, that is the measure that basically were tested to IoT projects. So let the satellite track-and-trace anything on earth that has a chip, not necessarily PQC chip can be a traditional [ Vault AC ] secure element. So you can track and trace from the space object. And this is a big market, right? Because 90% on earth is not connectable. So you cannot track an object in the middle of the sea or in the middle of the desert or in rural areas where connectivity is not available.

So there is a very big demand on companies and they are running logistics, cargo companies on their trucks, a company on their containers in the middle of the sea, military applications, they need to have that connectivity. And that's why we proved during the first 21 launches, this was obviously an important investment because of the company. Those launches are expensive. One satellite is a $300,000 to $500,000 to launch and produce, but we were one of the first ever PQC compliant constellation in the space with satellite than they are in orbit. Now we are moving into the next level of that with the last launch of the satellite we did in June, included already the latest version of the QS7001.

So we started to test -- we also added new things like a crypto wallet for SEALCOIN, which is another company of the group, WISeKey owns 80% of SEALCOIN in cooperation with Hedera. Hedera Hashgraph is one of the largest blockchain companies in the world. And with them, what we did is to embed our wallet into the satellite itself. So the satellite can change crypto tuck-ins with another satellite or with an earth station or with an object that will require a payment.

So imagine one satellite collecting pictures for another satellite and paying for that service with tuck-ins and those tuck-ins are automatically exchanged between the wallets, and they are located in each of the satellite. This is a breakthrough technology. We are now working on this -- I cannot say names now because we are still in the process of finalization. But you will see agreements with strategic professional service company and others, and they will resell that capability that we have already add to their clients because their clients are, as I mentioned before, they want to add a space into the cybersecurity contracts that they have with those professional integrators.

So the -- we are launching this space with the SpaceX IPO is going to boom, because SpaceX has already announced that they cannot even cope with the demand of sending rockets. So we will need to send rockets all over the world with different companies. We have established relations with ISRO in India with PLD space in Spain, those are new companies and they are sending rockets.

Our preference, obviously, is to do it as much as we can with the SpaceX and we have a very good relation with them. And I'm sure that something there will be very soon possible in a more integrated way because as we need to send more satellite, the objective is to send 100 satellites in the next month, we will need, obviously, to be able to scale up the launching capability.

So the final objective of those satellites is to act as some nodes in the space. So let's say that SpaceX sends -- creates a data center. And that data center needs to be connected to earthstation, those earthstations by the way, we have already 2 operational earthstation, 1 in the southern part of Spain and another in Switzerland, in Lausanne. Those earthstations, they are now triangulated with the nodes in the space, encrypting the data, using PQC chips on it on both ends.

And that data then is made available to data centers, both in the space in the future data centers then SpaceX is very focused to build, but also data centers on earth. So end users can get a combination, a hybrid combination of access to data centers in the space using those nodes. Without the node, the communication is not secure. I mean StarLink is not a secure satellite. They need a layer of security to talking to non-StarLink or SpaceX assets. And this is WISeSaT positions. It's an interconnector of existing constellations using those very sophisticated, high secure satellites that we are manufacturing and launching to this space.

So it's a very -- I mean the clients are there. We are working -- it has been announced with the Swiss Army is 1 important client. We are working with several financial institutions and they are saying, we will actually prefer to connect to the space or even to connect to the Internet as what they call the Quantum Internet, Space Internet and SEALSQ has launched an initiative we call QSOC, which is I mentioned that on my brief, is a quantum space, constellation cloud.

So in the future, you will be accessing the space like you access Amazon Cloud or any of those cloud and this is the positioning of the company. The fact that we own the critical infrastructure is a very strategic asset for WISeKey, not only in terms of the valuation because, obviously, the listing of the company on the NASDAQ is going to increase substantially the value because we are aiming at $250 million initial listing, and this company WISeKey is the majority shareholders.

So all that hopefully will be reflected on the increased valuation of WISeKey plus the fact that WISeKey, that has been also announced is planning, hopefully, by the end of this year, to move directly to the NASDAQ as a way to simplify the processes. Currently, we are listed in Switzerland, which is a very small market, not at all specialized in this type of technology. And this is obviously detrimental to the valuation of the company.

Great. Good luck with the convergence.

Thank you very much Matt.

[Operator Instructions] With no further questions at this time, would like to turn the conference back over to Carlos for closing remarks. .

So thank you very much for your attention to this call. The company obviously is available. This information will be provided to the investor side. the company, myself and John, we are fully available for any further questions. I'd like to thank the moderator for the organizing, to Lina, the IR company, and also for the questions and the analysts present on this call. Thank you very much.

Thank you. This will conclude today's conference. You may disconnect at this time, and thank you for your patience.

Thank you very much.

Greetings, ladies and gentlemen, and welcome to the WISeKey International Holdings 2025 Interim Financial Results Earnings Conference Call.

As a reminder, this conference call contains forward-looking statements. Such statements involve certain known and unknown risks, uncertainties and other factors, which could cause actual results, financial condition, performance or achievements of WISeKey International Holding Limited to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.

WISeKey is providing this communication as of this date and does not undertake to update any forward-looking statements contained herein as a result of new information, future events or otherwise.

[Operator Instructions]. As a reminder, this conference is being recorded. It is now my pleasure to introduce Carlos Moreira, Founder and Chief Executive Officer of WISeKey. Mr. Moreira, you may begin.

Good afternoon to all of you joining us from Europe and the United States. I am joined today by our Chief Financial Officer, Mr. John O'Hara. And I'll start this call by providing highlights on the company performance and also on the subsidiary level initiatives for the first half of 2025. I will disclose the growth opportunities since the beginning of 2025. And moving forward, and then John will provide commentaries on our financial conditions in greater detail. Then we will open the floor to Q&A.

I would like to provide now a short overview of the corporate structure. So WISeKey is a Swiss cybersecurity company created in 1999, which I am the founder. As a computer infrastructure provider, WISeKey delivers secure platforms for data and device management across various industries, including finance, health care and government, leveraging its route of trust technology and public infrastructure PKI. WISeKey is expanding its legacy technology into the quantum realm, building on the case of expertise in securing digital identities and enabled trusted communities, WISeKey continues to safeguard traditional encrypted communications and provide strong authentication services to governments, enterprises and consumer worldwide.

At the same time, WISeKey is pioneering the transition toward the next generation of security through the post-quantum cryptography, what we call PQC. This dual approach ensures that existing infrastructures remain protected today while preparing them for a future where quantum computers will challenge conventional cryptographic standard, it is being projected and this will happen in 2030. So we have only a few years to get ready. By integrating PQC into semiconductors, IoT and digital identity solutions, WISeKey is setting the foundation for a quantum resilient digital ecosystem, ensuring continuity of trust and privacy in the post-quantum era.

So WISeKey operates also as a holding company, encompassing several specialized operational subsidiaries, each subsidiary plays a crucial role in the WISeKey ecosystem contributing through independent research and development and expertise while integrating their technology into the overall WISeKey platform. This businesses are no longer operating as a separate businesses, but as a single interconnected ecosystem, what we call the convergent effect.

Specifically, these companies are SEALSQ, which is well known now as it is a listed company on the NASDAQ under the symbol LAES, which focus on advanced semiconductor technology and it's coming with a world first in November of a post-quantum chip. WISeID, which offers Root of Trust and PKI services central to the WISeKey digital identity and encryption services and ecosystem. WISeSaT, a newcomer also in the last year, which offers space technology using and developing and securing picosatellite for secure communications from the space. We also have WISe.ART, it's the trusted blockchain and NFT segment, offering secure digital asset solution. And lastly, we have SEALCOIN AG, which is incorporated -- which was incorporated in 2024 and is developing the SEALCOIN platform and is focusing on a decentralized physical Internet with a soon-to-come token with name QAIT.

In regard to the first half of 2025 has been a decisive step forward in the execution of WISeKey Quantum convergence strategy. So the WISeKey Quantum convergence strategy launched last year has the combining existency of combining different assets like proven identity, security methods with emerging quantum safe technologies to ensure a smooth transition into the post-quantum era. It maintains the protection of current infrastructure while -- sorry, classical cryptographic capabilities while progressing, integrating post-quantum cryptography, what I call PQC and quantum resilient algorithm.

This strategy relies on a hybrid model, where traditional and quantum safe algorithms work together, guaranteeing backward compatibility with avoiding disruption. By applying this convergence across semiconductor, IoT, satellite, digital identities and blockchain network, it ensures that the trust and privacy remains intact. As quantum computers advances, the essence of quantum convergence is the bridge today of security with tomorrow challenges, enabling a resilient and future-proof digital ecosystem. This quantum convergence is now beginning to show its financial potential as each component drives value creation for the others, enabling WISeKey to multiply revenues, diversifying them and starting to reduce the dependency of any single line of business and to capture new recurring income streams.

The foundation of this quantum conversion strategy lies in SEALSQ, which I mean before -- I mentioned before, is a major player on that ecosystem and one of the most secure and secure manufacturing capability of post-quantum chips, which is going to be released in November 2025 is a world first, the first post-quantum chip with the capability of protecting against quantum attack, so this is positioned to be the world first secure chip to embed NIST-standard quantum-resilient algorithm, the ML8-KEM CRYSTALS-Kyber on ML8-DSA-CRYSTALS-Dilithium which are the NIST standard quantum resistant algorithm that had been available for companies like SEALSQ to implementing their hardware devices. WISeKey control through its 52% of the voting rights of SEALSQ as of June 30, 2025. The Quantum Shield QS7001, which is the chip aims to secure critical applications such as cryptocurrency transaction but also defense system, healthcare infrastructure, airport security and IoT devices against future quantum computing threats.

As quantum computer advances towards what we call the Q day when Quantum computers will break traditional encryption like electric curve cryptography, ECC, RSA, the QS7001 chip addresses vulnerability in systems such as Bitcoin and other blockchains that could be hacked with this new computing capability provided by Quantum.

Current ECC base algorithm, including ECDSA are susceptible to quantum attack that could compromise public keys and expose funds. The quantum shield QS7001 integrates Lattice-based quantum resistant cryptography to provide secure key storage, efficient signing and key exchange operation, optimized for hardware wallet called storage and IoT devices. It also offers a migration framework with hybrid cryptography and tools to transition assistance system to quantum safe standards with minimal disruption. The chip is launched as an open hardware platform to hold personalized customer firmware, enabling full flexibility for all kinds of application.

SEALSQ also plans to launch the trusted platform module version of the QVault TPM in H1 2026. While it's very few competitors only integrate post-quantum cryptography through hardware accelerators that supports PQC via software implementation, SEALSQ QS7001 embeds this quantum resistant algorithms directly at the hardware level. This approach delivers enhanced efficiency, which is around 10x faster, side-channel protection and tamper resistance without relying on software layers aiming to provide a more robust foundation for long-term security at high-stake environment.

So the conversion does not stop at connectivity. Each secure device will in time be able to transact autonomously between themselves within a SEALCOIN ecosystem from which WISeKey holds 75% of the corporation created. This is creating four revenue stream through transaction fees on trusted IoT changes. Earlier this year, WISeKey proved the potential of this model with a world first space-based cryptocurrency transaction, showing, demonstrating how satellites, chips and the blockchain can combine the power on entire new digital ecosystem or new generation of WISe.ART platform, which WISeKey is owning 87.5% of the Corporation and remainder is held by The Hashguard (sic) [ Hashgraph ] Group, the Hedera blockchain company which is a pioneering Swiss-based work 3.0 technology company.

So this platform adds a fifth layer by extending this infrastructure into tokenized assets generating transaction revenue from authenticated trading on both digital and physical assets. Together, this creates a diversified yet fully integrated monetization model where every element from chip to satellite to blockchain to marketplace reinforces and extends the other.

So for shareholders, the value of this model lies in scalability and resilience. Hardware sales generating media revenue, while OSPT services, satellite subscription and blockchain transaction and tokenization provide recurring income streams that we expect will grow with adoption.

This means that each customer or partner engagement has a compounding effect, a defense contractor, let's say, adopting SEALSQ chips could also become a client for OSPT services or it can also be a subscriber for WISeSat connectivity, a participant in the SEALCOIN transaction and potentially a user of WISe.ART for tokenized asset management.

It is important to note that only few companies in our sector can offer this level of vertical integration and horizontal interoperability and monetization. So this sets us apart from most of our competitors and makes the DNA of WISeKey.

Another key point are the strategic partnership in which WISeKey is building further enhancement in shareholder value by creating new addressable market, such as the Quantix Edge Security initiative in Spain, which actually has been announced this morning as a finalization company with a participation of the Spanish government invested in that company EUR 20 million, on which WISeKey is also investing together with SEALSQ EUR 10 million. And this company has already a committed revenue of EUR 25 million over the next 3 years for the company. So this is already a very concrete example on how this verticalization works, how you can create what we call decentralized value by bringing the technology at national level.

So this is the -- this company is at the heart of semiconductor sovereign strategy in Europe. which is supported by public funding and demand for secure microelectronics. Also, our collaboration with the Swiss Army, which is already 3 years going, demonstrate that our convergence model is not just theoretically but already being deployed to deliver ultra secure sovereign communication, such as connecting mobile phones with our satellites and being able through those mobile phones to secure the communication directly with the satellite and to exchange the keys that they are required to ensure that both devices end-to-end are secure and authenticated or protected.

And also our HUMAN-AI-T initiative, which we launched with the United Nations, extends our leadership-based technology into AI global governance, which although is not directly related to revenue generation, it is required in order to ensure that countries of the world can benefit through the AI revolution without the need of dependencies. So those initiatives are strengthening our brand, creating influence over standards and laying the foundation for future trust services where AI must rely on secure chips, authentication of data and tamper-proof transaction.

So as WISeKey moves into the second half of 2025, our focus is on scaling execution. Here, I give you a few milestones. We are approaching the commercial launch of SEALSQ’ in Q4 2025. The date actually is now around the 22nd of November as a world first, which will -- which we expect will trigger new revenue growth in 2026 and beyond, as already communicated during the earnings call of SEALSQ, where these projections were disclosed.

We're also expanding the WISeSat constellation to increase coverage and open new subscription. Now we have 22 operational satellites in orbit. We are testing real time those satellites on a daily basis by connecting devices to the satellite with a new launch, which is due in November, again, with SpaceX, which will include the new generation chip and will coincide with the world's first launch of VaultIC, the new generation chip for post-quantum capabilities. So we are also bringing SEALCOIN and WISe.ART from the pilot stage to commercial deployment, establishing new transactional base income stream. And we are strengthening OSPT footprint to ensure that every chip produced by SEALSQ had rapidly personalized and integrated into this global infrastructure.

For shareholders, the message is loud and clear. WISeKeY convergence strategy is designed to create multiple layers of monetization from each customer relationship recurring revenue stream that compound over time and strategic partnerships that are open to us creating a new market while derisking the execution.

So with $170 million robust pipeline of revenue opportunity at September 8, 2025, for the period '26 to '28, a very strong balance sheet and increased global recognition of a role of the intersection of quantum security, space connectivity, blockchain and AI, WISeKey is building a business designed to scale, resilience and long-term shareholder value.

So WISeKey is not just adopting to a technology change. Actually, WISeKey is shaping it. We are building new world's sovereign trusted digital infrastructure that the world increase is dependent on as currently the move is to centralize technology in some few countries and few players, which creates a dependency issue. So for investors, this represents a unique opportunity to participate in the creation of a company positioned not only to grow revenue but to define the architecture of digital trust for the decades to come. With that, I will now turn the call over to John, who will provide further insights into our first half 2025 financial highlights. So John, please go ahead.

Thank you, Carlos. As Carlos mentioned earlier, WISeKey performance in the first half of 2025 is in line with our expectations. While the company is executing on its strategy moving towards next-generation semiconductors, space connectivity, transactional IoT and blockchain laying the foundation for sustainable long-term growth.

For the first half of 2025, revenues grew slightly by $0.1 million to $5.3 million, which was entirely in line with our expectations reflecting the continued transition period, which is coming in ahead of the industry-wide strategic shift towards post-quantum and IoT-driven technologies.

As in slide here, I would highlight that with the second half growth is already -- we've got very -- all our orders for the second half booked out at the SEALSQ level. And we actually now have roughly a 300% higher backlog of book orders for 2026 than we had at the end of 2025. So we already have much more confidence in the figures going ahead in the continued growth.

Our operating losses did increase by $30.2 million to $27.3 million, but this was largely driven by a one-off stock-based compensation charge at the SEALSQ level of $10.1 million. in addition to increased investment in research and development and an increase in the general and administrative costs as a result of an investment in the infrastructure of the company to support developing verticals.

The increase in the operating losses is partially offset by an increased nonoperating income due to a one-off gain on the settlement of the ExWorks loan, which we recognized a $3.7 million one-off credit as we settle for far less than the out held on our balance sheet and interest earned on our cash deposits of $1.6 million. This results in a net loss of $22.3 million for the 6 months to the end of June '25, which has increased by $6.8 million in comparison with the same period last year.

As I just mentioned, we continue to invest in research and development, which for the first half of the year totaled $5.8 million, focusing on the development of SEALSQ's next-generation quantum resistant chips, the SEALCOIN transactional IoT platform, the WISeSaT expansion and Constellation and the launch of the WISeSaT 3.0 platform. Our strong balance sheet and cash balance of $124.6 million as at the end of June, will allow us to accelerate technological development and to execute strategic investments that expand our capabilities, strengthen growth pipeline and position-wise get the forefront as the transition to quantum resilient security solutions.

A brief word on the outlook. We expect strong growth in the second half of the year with full year revenues expected to be in the range of $18 million to $21 million. This growth is driven by the expected return to growth in the demand for SEALSQ's traditional semiconductor products, the consolidated revenue of IC'ALPS, a subsidiary of SEALSQ since the completion of the acquisition by SEALSQ on August 4, 2025, as well as the continuing development of the revenue streams of our other business divisions. We look forward to reporting our progress in the coming months.

With that, this concludes our prepared remarks. I would like to now open now the line to Q&A.

[Operator Instructions] Our first question comes from the line of Matthew Galinko with Maxim Group.

And congrats on getting the Quantix deal done. Can you maybe touch on the contribution from Quantix. I think the press release said a relatively even revenue recognition of $20 million over 3 years. Is there anything we should think about for margins on that project revenue? And is there potential for product revenue on top of the project revenue?

Just to clarify, it's $25 million over 3 years. So margins in that, yes, it's -- they vary a bit because some of it is equipment and plants as we install the equipment in Murcia. So some of that will be lower margin than our traditional semiconductor work, but then other elements will relate to professional service type arrangements, the expertise of our staff, the installation of IP. So it would run, we would expect at a higher margin, something much closer to what our -- well, as a margin level, would be very high because some of these staff are already currently employed by us. But yes, we start to be somewhere in the sort of the more traditional margin range.

Then yes, as the PR also hopefully highlighted, we were also agreeing that we will be looking to allow them to sell our next-generation semiconductors and other products directly beforehand so that we don't kind of lose momentum or lose too much time. So yes, we would hope that there will be product revenues coming through whilst the center is still under sort of construction.

Yes. Maybe, Matt, this is Carlos. So just maybe to develop a bit further on that point. So this deal is actually a very important deal because this is the first personalization center that we sign, right? So the logical to personalization center is that many countries now they are getting concerned about the dependency on semiconductors and they want to have some kind of control on that process.

And they start with injecting the keys, although the chips might come from whatever Taiwan, Singapore, whatever, but they want to inject the keys at national level. And those are the machines that John just mentioned. So there is going to be a full transfer of knowledge, equipment, licenses, IP, royalties in order for them to be able to do that. So this is -- and that includes obviously a building ultra secure facility, which we just came actually. We were there yesterday. So we were visiting that facility.

So parallel to that, there is going to be -- this investment is a private partnership with the Spanish government SETT. So SETT is sitting in EUR 18 billion, actually, to develop semiconductor capabilities in Spain. So they are investing in Cisco, got EUR 300 million in Barcelona to develop a plant. There are many companies around the world, and they are coming to Spain due to the fact that the government is willing to co-invest with companies, and they would like to develop semiconductor capabilities at national level. Which is okay, right? So they put $20 million, we put $10 million and another start-ups in Murcia, Spain put another $10 million.

So obviously for us is we recover our investment, because we have $25 million commitment over the next 3 years. But in the plus of that, as John said, we're selling immediately the semiconductors even before the center is fully operational to the market, and Spain is a high user of IoT, the electrical solar power plants, all that requires IoT connectivity. It requires authentication, required chips on solar panel the agricultural business, which is huge in that area, they are using IoT sensors to monitor water irrigation. So there's a lot of very interesting new applications that we are adding to the ones that we already do with these new generation chips.

In plus of that, because SETT is an investor in many other companies, not only us, it creates an ecosystem right? Because the companies where they are also investing, they are creating synergies with other companies that like us now. So we are entering into new agreements like we signed with OdinS and TProtege. Those are local companies, and they are very highly specialized in a specific sector that then we can also bring to other countries.

As we are currently negotiating actually, similar experience of those personalization centers in several countries, like including the United States in Arizona, where we are also advancing, also in India also in South Korea, there was last week at MoU signed with the major of civil and many countries are coming to us to say, wow, we really want to use your technology, not only because it's unique, nobody has it in terms of having this post-quantum chip. But in plus of that, you are maybe the only company in the world that is willing to help us at a national level; other companies, they rather centralize this technology, right? So this is creating a very interesting ecosystem for us.

And as I mentioned during my introduction, that creates huge synergies with the rest of the companies WISeKey Group has, right? Because once you have those chips deployed at national level, then the next thing is connectivity, then is where the WISeSat satellite makes a lot of sense because we already concrete test on how to connect the satellites directly with sensors, then they are located into IoT devices or device-to-device communication or mobile-to-satellite communication. So that is a totally new industry emerging, and actually WISeSaT is booming, thanks to that, right?

And then you have the tokenization, which is also a very interesting technology world first, which is letting machine to pay each other with SEALCOINS, right? So imagine a satellite buying data for another satellite and getting paid with SEALCOINS or a connected car buying data from a plug, electrical plug and do that directly through the car connection to the plug without the need to pay with Visa, MasterCard, right, intermediaries.

So this is a very complex technology. People sometimes don't grasp the complexity that we are dealing here. But the good thing is the company is really making a huge progress, right? As each of those verticals are evolving. And they are creating, as I mentioned, this convergence synergy, which is what I believe is going to be the breakthrough in revenue here, is that once you build a very large microchip infrastructure, they start to want to be connected, they start to be transactional. And that creates a very new stream of revenue for the company in the years to come.

Appreciate the answer, Carlos, and John, a lot of color and very helpful to see how everything is coming together. I guess in the follow-up, you talked about the $170 million I think the 3-year business pipeline on the SEALSQ press release and conference call, and you repeated it here. Can you talk about how significantly, the TPM is represented in the pipeline versus some of the other applications of what you're working on? Or is TPM kind of a major component of that?

It's a mixture between the three, it is a mixture between the QS7001, which is the new chip. And that chip is basically upgrading the existing security of existing chips. So clients, and they are on the legacy chips and they are buying 5 million, 10 million of those chips per year. They want to upgrade now.

As you know, out of the $170 million, an important piece is the design wins that the company already have with some of our clients, right? And they are then they are getting concerned now on the new legislation in the United States, but also in Europe actually now, that by 2027, the White House actually there's going to be in a few days, I guess, in a few weeks is going to be White House, similar to what happened on AI. It's going to be on quantum and regulation of quantum, that says companies needs to be quantum resilient already before 2027 and then by 2030, legacy systems will not be authorized anymore in critical infrastructures, right? So because the risk will become huge because everybody is now kind of in agreement and Quantum day arrives in 2030. And if you wait until 2027 to start to get ready for it, it's going to be too late, right?

So this regulatory push is making, obviously, and you see that on the evaluation of some Rigetti, IonQ, the wave and SEALSQ, you see that happening now. I mean companies that they are in this quantum realm, they are getting a very strong valuation because it's actually easy to project in the next 10 years, what will be the revenue and the valuation of these companies if that momentum happens and because this is a regulatory type of movement now. It's going to happen. I mean there's no way that companies will not do it because their insurance premium will increase and then the clients who will get concerned on their products are now PQC ready and things like that. So part of the $170 million comes from that.

The other priority comes from the TPM, as you say, and that is a bit later on the year. And the rest is coming actually from the centers because in every center that we built, the price is between $40 million to $100 million, depending the country, right, in the United States is a $100 million project. And you need to -- and even in some cases, we might want to invest together with investors to show that we are really serious about it, and this is important to us because we provide the licensing, the technology, the chips, the machines and everything. It becomes also revenue for the company. So this is the breakdown of the $170 million.

What is happening now is that clients then they are being using the VaultIC. So VaultIC has been sold already historically 1.6 billion times. So it's a massive community of companies using already our technology. Some of them on a legacy environment, they are now considering to move into post Quantum, like yesterday, we announced a Taiwanese company that is doing ledger technology for storage of Bitcoin, Hashkey storage, and everybody is getting concerned that once Quantum arrives, the blockchain can be compromised. And therefore, people can lose all the bitcoins. And we signed a deal with them where we PQC enabled those devices. They are testing on a small group of devices, but obviously, the normal step is the entire production is going to be PQC ready next year.

And I'm sure you're following as analyst the PQC addressable market, which is getting bigger and bigger, because we have, for the time being, we don't really have a clear competitor on PQC. I mean, the possibilities are projecting very high revenue. It becomes very realistic. Very big company.

One question I get all the time, say, "Oh, how can you do that?" And I don't know, one of those multibillion-dollar chip manufacturing company don't do it? And the reason is that these are very large companies, and it's very hard for them to defocus from the current technology to just develop a PQC technology play and that takes 3 to 5 years to do it, right? So this is the years we have that we can conquer the market or at least take as much as possible of the addressable market.

Carlos. Great color on that. Maybe just last one for me before I jump back in the queue. You touched on commercializing WISe.ART with the 3.0 release and maybe in conjunction with WISeCoin -- SEALCOIN. Can you touch on maybe how you kind of what's the path to commercializing that piece of the business? And what can we expect for that in 2026?

So WISe.ART we developed, originally, the concept was that if you have a microchip into an object and that object is secure within microchip and authenticated, let's say, a spare part of a car or a drone or a hardware device, you can create digital twins of this part. And then on the metaverse or being able to regenerate the car, right, transfer directly from the original into the digital twin environment where engineers can play with the digital twin without touching the car. So that still is the design. And obviously, it's a very early business and the people are not doing that yet.

The technology is what 3.0 is a complex technology. You have to put an identity on every spare part. And that identity needs to be storing a secure element, secure element injected into the object. The object then generates the digital twin and so on. So we found that art was the easiest way to start. And actually, we were very successful in art. We have now 1,000 of artist and we have thousands of pieces of arts than they have been dematerialized.

But then you have these NFT collapse during the last 2 years, NFT companies like OpenSea and others, they just totally collapsed. We have suffered a bit of the misunderstanding of the market and say, "Oh, WISe.ART is an NFT platform," which is not. So we are basically reeducating the market to really see the potential with WISe.ART, which is becoming less maybe art, it is more like industrial generator of digital twin components to be analyzed on a digital environment.

And then the SEALCOIN becomes the payment method or whatever you need to do between those devices. I mentioned before it is the machine to machine. So our objective is both companies actually WISe.ART, WISeKey in the identity management. They were very close to create that identity relation. And then we have, as I mentioned, plans to bring SEALCOIN as an exchange. So SEALCOIN will soon be on a topic change. We will give more information soon about that. And that will obviously create a huge amount of potential new diversification of revenue.

Also WISeKey acquired 22% of WeCan. So WeCan is another blockchain company that develops -- we did it through the direct investment on SEALSQ. That was the model which we chose at that time. But as we all know, WISeKey controls the interest of SEALSQ. So both companies are working with WeCan in a KYC compliance using blockchain. So this is a very interesting project where you can basically bring web your technology to the financial sector and simplify the process of customers or banks to provide KYC compliance processes and registration.

So you see the technology is converging, and that's the beauty. I think in 3 years, you're not going to be talking so many companies, so many products, you're going to be talking really bring Web 3.0 technology and simplify the process of customers of banks to the financial sector and simplify the process of customers of banks to provide KYC compliant processes and registration. So you see the technology is converging, and that's the beauty. I think in 3 years' time, you're not going to be talking so many companies, so many products. You're going to be talking really on Web 3.0 cybersecurity, which is what it's all about and connectivity.

And obviously, you need to start somewhere. And the way to start this is by creating those specialized, very focused companies, and they are solving one specific problem. But once this problem is solved, it creates a lot of synergies with the rest of the ecosystem.

[Operator Instructions] Mr. Moreira it seems there are no other questions at this time. I'll turn the floor back to you for final comments.

So thank you very much for your help in organizing this call. And thank you very much to Matt and the analysts and they have been following us and also, obviously, our shareholders and investors, that they might be joining the call. If you didn't have the possibility to join, this call has been recorded. We also have, obviously, all the presentations available on our website. And John and I are here available for any further questions you might have. Thank you very much for your attention, and have all a great day.

Thank you. This concludes today's conference call. You may disconnect your lines at this time. Thank you for your participation.