Good afternoon, everyone. Welcome to day one of the Sidoti Conference. My name is Aashi Shah. I am an analyst here at Sidoti. With me today, I have Cloudastructure. It trades under the ticker CSAI on NASDAQ. I am happy to welcome James McCormick, the CEO, and Greg Smitherman, the CFO of the company. We have 30 minutes today, including the Q&A. The audience, I would like to request, if you have any questions, please submit them at the Q&A section at the bottom of your screen. With that, I will leave the floor for you guys. Thank you. Great. Thanks, Aashi. Okay, let's talk a little bit about Cloudastructure, who we are and what we do. At the highest level, we are a video surveillance company using artificial intelligence and humans in the loop to protect enterprise customers in a proactive way, and we stop events or threatening activities before they become a problem. We will give you a few seconds to read. I am sure you have seen plenty of these, and we will move forward. Wonderful. Some interesting statistics here. There is over 1 billion surveillance cameras that are deployed on a global basis that are capturing over 1.4 trillion minutes of video footage daily. The vast majority of that footage is not being reviewed. It is passive. It is used for forensic purposes. We are just the opposite. 100% of the video footage that we capture is evaluated using our artificial intelligence models, and we turn video from being something that is passive into active protection. So we built our system from day one to be cloud-based, hence the name of the company, Cloudastructure. 100% of our videos, nothing goes to a hard drive initially, right? Everything goes through an appliance that we have developed. Sends the video up to the cloud, down to our AI servers for evaluation. We offer enterprise businesses video surveillance, analytics. We actually index customer videos much the same way that Google indexes the web or web results. It makes it very easy if a customer wants to go back and find a specific event or a specific person or a specific vehicle, for instance, they can do that very easily because we index all their videos for them. The last bullet point, the remote guard services or humans in the loop. What we do, and one of the things that differentiates us is, once our artificial intelligence determines that something might be a threatening activity for the cameras that are protected or include our remote guarding solution, it actually goes to humans that will evaluate the event that was triggered by AI. If they determine that it's something that requires further intervention, either a talk-down through a speaker or contacting local authorities, 98% of the time, we stop the event before it becomes a problem. Huge differentiator for us and one of the main reasons that our customers absolutely love working with us. It's always good to see it in action. You're going to see video from two of our customers, both happen to be in the mail rooms of their respective buildings, and how quickly, once the guard starts talking, the people walk away. Sure. They come in, an alert is sent. Is this bad? The guy's trying to. There's something to be. Crank open the mailbox. Yeah. You are being watched and recorded by a live agent. Please leave immediately. Once that voiceover comes down, off they go. Instead of damage in the mail room, instead of stuff stolen from a car in a parking garage, and the next day, the only thing that the property manager gets instead of a line out the door of upset tenants, is a report from us in their email detailing the event, gives them video clips, description of what happened, our guard's interaction, and the resolution of the case. Fantastic for keeping tenants there. Dramatically lowers repair costs, damages to mailbox or other parts of the property. It ends up driving their bottom line. That's why they stay with us. And stay they do. We have a 99% customer retention rate. The market we're going after, and this is just looking at the AI video surveillance space, not surveillance. The surveillance market as a whole is even larger than this. AI has been getting a lot of press lately. It's really taken off in video surveillance. We, from day one built for this. The founder actually had the idea over 20 years ago, 15 years ahead of the time before the technology even existed to make this happen. We are jumping on this wave. It's growing much faster than the overall market, and we think there's tremendous opportunity for us going forward. As I kind of hinted, while the company technically was founded over 20 years ago, we really started becoming a commercial company after we'd raised $35 million through Reg A in 2020, 2021, into 2022. We had our first multifamily customer, and that was our first sort of anchor industry in 2022. After that, we built our remote guarding seamlessly into our system, hired our first remote guarding team in 2023. By 2024, we had six of the top 10 largest property management firms as customers. Today, we've got eight of the top 10. So over our brief history, we have really made significant penetration into very, very large customers. We went public last year, had 270% year-over-year revenue growth, really just starting the beginning of what we believe is going to be long-term significant ramp in revenues. It's always nice to get external validation of what you're doing. Here's a sample of some of the awards that we have been given over time. If you look at the upper left-hand corner, just recently, like in the last month, we were awarded the PropTech Property Management Solution of the Year award for 2026. So it's not just us saying, "Hey, we're doing good things and we've got good statistics." There's also external validation of our solution, what we call an award-winning solution. Which has been consistent over the last five, six years. Mm-hmm. Let's talk about the verticals that we're servicing today. We alluded to it a little bit earlier, but multifamily, that was our first foray, I guess you would say, into larger enterprise deals. Since 2022, when we had our first multifamily win, we've continued to expand in multifamily. As Greg mentioned, we work with eight of the top 10 largest property management firms in the United States, including the top two. This year specifically, we're focusing not just on getting additional logos, but expanding our presence into accounts where we already have a relationship with. land-and-expand, if you will. Some of the other verticals that we have active installations in include critical infrastructure. Think like a large remote solar farm in the middle of nowhere. Construction, specifically active job sites where we provide protection for or against potential safety issues, as well as preventing the theft of materials and tools. One of the areas we're very bullish on is trucking and logistics. We have a relationship, for instance, with a secure truck lot operator where truckers make reservations. They park in the lot, and one of the things that they offer is advanced security solutions, meaning us, to keep people from tailgating and trying to get in that way into the facility or going through the perimeter, going through the fence to get access to the trailers to steal whatever might be inside. Then commercial real estate. We had a press release earlier this month announcing that we have a relationship with an owner of a number of open-air retail malls in Southern California. We have an agreement with them to start with an initial six of their properties, then expanding from there into the remainder of their portfolio, and mainly protecting the perimeter of the malls as well as the parking lots. Those are some of the verticals and some of the ways that we're generating revenue. We talked a little bit about the land-and-expand strategy. Here is a list of some of the logos that we work with, both from a property management standpoint. You see the logo Riggy's in the middle of the slide. That is the secure truck lot provider that we're working with. But you get the idea. These are names that you've heard of, names that you know, and we're very excited about expanding further into the portfolios, not just of the eight of the 10 top largest, but all of the customers that we work with. Our goal is not just stopping at one property, but figuring out how we get into multiple properties once we've proven the validity of our service. As we talk about our revenue model, our revenue is really broken up into three major categories. The most important of which is our subscription, our recurring revenue, and that covers our video surveillance and our remote guarding. In addition, we do sell hardware. Some of our customers either don't have cameras or need upgraded cameras. Then the installation component. The hardware and installation component is lumpy. Some of the customers we sign up already have a system in place. We're taking over from a competitor. If we look at 2025, 57% of the cameras we took over, they already had a system and we were taking them from one of our competitors. This year, it's 77%. There's a really big leap this year. Not that it was specifically targeted, it's just the way the particular deals worked out. While the installation revenue has dropped a little bit because we've been doing more takeovers at the beginning of the year, the key thing is if you look at the yellow part of that bar, it's that continuing building of the subscription revenue that just keeps getting bigger every quarter. We've got 99% customer retention rate. So once they're with us, very seldom do people leave. That's the core, and that's what we're building towards. That's how this gets to be a very long-term, large, and profitable business. Just highlighting, again, some of the things from the last Q2 of this year. As I said, 164% subscription revenue up year-over-year compared to Q2 of 2025. In the quarter, 62% of our revenue was from that recurring revenue stream. Very profitable for us. We are currently running just on the recurring revenue perspective, a $3.1 million revenue run rate. We started the year at about a $2 million, so that just keeps rampant and rampant. Gross profits were up. All this is great, but for me, the biggest statistic and the most important one is 99% customer retention rate. People like us, we're giving them a great product, and they stay around. One of the things we're very excited about is some recent additions to our executive team, and let us explain. Greg and I, we have similar yet dissimilar backgrounds, but we've both had multiple CXO type of roles over the years. I was previously on the Board of Cloudastructure, joined as CEO over two years ago, specifically around driving or helping to drive the process of going public, which we did through a direct listing. We just announced earlier this week the addition of Nile Coates as our Chief Revenue Officer. Niall most recently worked for a competitor of ours, direct competitor company called ECAM, where he was responsible for managing $370 million of annual revenue and about 75 sales reps. We are just very excited about him coming in, revamping and restructuring the sales organization, and helping us drive across multiple enterprises and multiple verticals. Ed Burnett joined us earlier this year. Ed spent 30 years of his career, last 30 years of his career, at UPS. The last 10 years, he was in charge of security for all the United States, as well as global fraud investigations. Ed is our Chief Security and Operations Officer. So anything to do with security, transportation, and logistics, Ed is our go-to individual, as well as he has direct responsibility for a number of the operations of the company, including deployments and remote guarding. Gregory Rayzman, our CTO, is a co-founder of the company, and Gregory's been around since the very beginning back in 2003. Very strong team. We're very excited about building the business and drawing on the experience of all of us to help make us an even bigger and profitable company. To wrap it up here, the two most important statistics that we feel are our 98% deterrence rate from our platform. Incredibly powerful, incredibly valuable to our customers, which is why we have a 99% customer retention rate. We have got big inroads with great customers in the multifamily space. We are moving to additional verticals, but we have got just within the multifamily space, huge opportunities to dramatically increase our penetration. We have got a very experienced management team. We have recently really bolstered it with some extremely seasoned executives that saw the potential that we have here and said, "Yep, we are going to come and join this team and build something really special." That is it for today. Be happy to open it up for any questions that you have. Thank you so much for the presentation. I would like to remind everybody in the audience, if you have any questions, you can submit them at the Q&A section at the bottom of your screen. There are a few questions I would like to start with. Who are your main competitors, and what does the competitive landscape look like in the industry? If you could just go over that. Sure. There are a number of competitors, all different shapes and sizes, I guess you would say. Some names that people would have heard of, Verkada. We talked about ECAM, where our new Chief Revenue Officer came from. Then there is a variety of upstarts, I guess you would say, right? Smaller companies that are trying to do the same thing as we do, but in a different way. When you talk about things from a competitive landscape, we think we have got a unique solution, right? I mentioned Verkada. Great company, billion dollars in revenue, but their model is long-term contracts and proprietary camera technology, right? In essence, they try to lock in their customers, right? Once they have them, make it difficult for that customer to go away. There's other companies, we mentioned certain upstarts that are trying to use artificial intelligence at the edge, specifically using AI that's incorporated in camera technology to make a determination of, is this a threatening activity or not a threatening activity? Frankly, it just doesn't work very well. Then there's other companies. We had mentioned ECAM and others doing similar things to us. But the main differentiator is, if you look at that 98% deterrence rate that we talk about, our solution, our technology works. Greg mentioned takeovers, being a significant portion of our business in the first half of this year. What does that mean? That means that there's a customer out there, or customers, that are not happy with their existing provider, and there's a variety of reasons why that is. Some of it might be pricing. A lot of it is the solutions that they're currently using, they miss threatening activities. That's the worst thing you could possibly do. Something happened, and you didn't recognize that it was a problem, and something bad happened to that particular customer. So we think our model of capturing video, analyzing 100% of the video, constantly tuning and tweaking our artificial intelligence models, and having humans in the loop from a remote guarding standpoint, we think those are all differentiators that make us stand out from our competitors. Right. Can you talk a little bit about your revenue model? How do you charge? Is it per seat or is it per enterprise basis? Yeah. Also, you've spoken about the land-and-expand strategy. You recently signed a contract which came through referral. Does that change the pricing for the company when they bring more referrals or? Yeah. All very good questions. Greg, do you want to talk about the revenue model? Sure. As we alluded to before, there are three main components. Hardware, if they need it, right? If it's a new build or they're replacing their equipment, and that's very straightforward, right? We source some hardware. We mark it up. We get a pretty good markup and sell it. We also manage the installation. While we have a few folks that will occasionally go out and do their own installs, it's mainly third-party installers, which gives us the ability to install anywhere. We're mainly focused in the U.S., but we're in about half the states right now, and leverage a wide number of installers. We mark that up a little bit and so we make some margin on that, but not as great. The core part of our business is the service side and the recurring revenue side, and there are two components to that. One is the base functionality of video surveillance. That gives people access to get our AI analyzing their video, indexing it, making it searchable and actionable, provides them 30 days of storage. If they want more, we're happy to sell them, if they want 60 days, 90 days, but 30 days is generally what most people want. We charge that. The base price is $35 per camera per month. If you are big enough, you can get some discounts. If you have multiple properties, yes, you can get some discounts. Then remote guarding on top of that. For the cameras that you want guarded, that is another $79 per camera per month. It takes all of the core system, adds to that. We set up all the alerts based on what the customer wants to do a trigger. It might be, "Hey, this one area, no one should be in. We want an alert any time someone goes into this area." We can do it also, we want to know when they go into that area. We don't care when they come out because we know someone is already in there, so the direction that you go. There is a lot of different things that we can do to set out alarms to meet whatever the customer's specific needs are. Then as James said earlier, when those alarms go off, we have a person actually looking at that specific video. They're not watching a bank of screens. They're responding to alerts. So when something comes in, they are dedicated to that. It's not, "Boy, I hope they're looking at my screen when a bad thing happens. Right. Because we are able to leverage AI, a person can effectively watch dramatically more number of cameras than they could if they were just staring at screens. But again, that is dollars per camera per month. Aashi, one more thing I would say, or we would say, about expanding multiple properties with a customer, a couple things. Our model is not to compete on price, but of course, we are sensitive to the needs of our customers. Right. If there is an opportunity for us to go deeper into a portfolio and build that recurring revenue base or subscription base, of course, we evaluate that, as you would expect, right? The other thing that is interesting is with some of these property management companies, we have actually gone through the process of negotiating master service agreements to make it easier, right? If a particular property does want to implement our solution, for it to be affected, I guess you would say, right? Because the terms have been negotiated, pricing has been negotiated. So we are doing a number of things to try to aid the land-and-expand. Right. What do you think of the merger and acquisition scenario in the industry? Do you have any acquisition aspirations right now? Yes, of course. Part of the reason we wanted to have a public currency was to be able to affect some sort of M&A or M&A transactions in the future. We are always actively looking at different technologies and business models that would be complementary to what we do. Yes, we are very keen on growing the business both organically and, where appropriate, inorganically from an M&A standpoint. Like I said, we are evaluating things. Nothing really has hit the sweet spot or the direct target so far. But yeah, we absolutely think that is a potential leg of future growth. Greg, anything you would add from that standpoint? No. You said it exactly right. We are always looking. People are bringing us opportunities. We are evaluating, but it has got to be the right fit. James and I both have deep backgrounds in M&A. Right. We are both very aware that a lot of M&A doesn't pan out well. Finding something that is going to work for both sides and making that flow seamlessly for the company is something we really understand and are very careful about. Right. If you can just briefly tell us what your current quarterly burn rate is, and when you need to raise any additional capital in the coming year or remaining 2026 and 2027. Yeah. We're currently burning a little over $0.5 million a month. It varies month to month. We ended Q2 with $3.8 million in the bank. We do have some facilities in place to raise additional capital. That being said, we are always open to other opportunities. Yes, to get to cash flow breakeven, we will need to raise some amount of money, but we don't think it's going to be an extensive amount of money. Okay. With that, we're out of time, and I'd like to thank you very much, James and Greg, for sharing your story with us and spending your time with us today. Of course. I would like to thank everybody in the audience for listening and spending time with us today. Thank you so much. Have a good day. Thanks, Aashi. Thanks, everyone. Thank you.