Greetings, welcome to the Remark Holdings Fiscal Year 2022 Financial Results Conference Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Vice President of Investor Relations, Fay Tian. Thank you, Fay. You may begin. Thank you, Alicia. Good afternoon, everyone, welcome to Remark Holdings Fiscal Year 2022 Financial Results Conference Call. I am Fay Tian, Vice President of Investor Relations for Remark. On the call with me this afternoon is Kai-Shing Tao, Remark's Chairman and Chief Executive Officer, and Mr. Todd Brown, Vice President of Finance. In just a moment, Mr. Tao will provide an update on our businesses, and Mr. Brown will recap our fiscal year 2022 financial results. Following these remarks, we'll open the call to questions. Before I turn the call over to Mr. Tao, I would like to take this opportunity to remind you that some of the statements made today may be forward-looking statements. These statements involve risks, uncertainties, and other factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements. Any forward-looking statements reflect Remark Holdings' current views, and Remark Holdings expressly disclaims any obligation to update or revise any forward-looking statements after the date hereof. This disclaimer is only a summary of Remark Holdings' statutory forward-looking statements disclaimer, which is included in full and is filed with the SEC. I'll now turn the call over to Remark's Chairman and Chief Executive Officer, Mr. Tao, so he can provide additional information on Remark's business and recent developments. Please go ahead, Kai-Shing. Thank you, Fay. Thank you for taking the time to listen to our quarter four update as we have much to update on. In Q4, we've continued to execute on our plan to continue to build a foundation to scale our Remark AI platform globally. The legendary investor Warren Buffett once said, quote, "Someone's sitting in the shade today because someone planted a tree a long time ago." Unquote. We are that tree as it stands today, and we'll continue to watch it grow and reap all the benefits from the foundation we have put in place over the last eight years. Simply put, 2022 was a year where we were able to successfully diversify our businesses to other parts of the world, most specifically the U.S. and United Kingdom. In 2023, you will not only see the announcements of major wins in both the U.S. and the U.K., but also our expansion into the Middle East and Latin America and to achieve the goal of profitability by the end of 2023. With all the excitement surrounding OpenAI ChatGPT launch at the end of last year, which has sparked a fervor of interest in AI companies, we strongly believe we are only just scratching the surface for what AI can do for you, me, and the rest of the world. We have already launched our own ChatGPT service to augment our offerings to our customers. For example, as you know, we already have a growing business dealing with construction companies and using our AI to help manage their workforce in the daily intricacies of project management. By now adding Remark AI's generative AI capabilities to our product offerings, we will be able to offer AI-based design services as well. In our last quarter call, we were accurate in our prediction that China would be loosening their COVID rules by the next time we spoke. We are excited to see all businesses rushing to bring their businesses back to pre-pandemic growth numbers. We certainly expect to be a beneficiary of this. In Q4 2022, here are some updates on previously announced wins. One, w e deployed our Smart Campus products to now over 100 schools, which makes our total deployment over 600 schools and serving and protecting 1.2 million students daily. Two. We finished 11 Smart Construction projects in Q4 2022, which brings us a total of 97 construction project deployments in 2022. We are anticipating another 100 construction projects in 2023 as the COVID pandemic has ended now. Each initial construction project generates approximately $100,000 in revenue, and the pace of Remark's installations are expected to grow as China opens up. Three, our previously announced wins using Remark AI's retail platform for both China Mobile and Bank of China's retail branches are now set to resume as the stores are now back open. Four, with China Mobile smart communities, we've now begun to resume deployment, and we anticipate to be installed in 100 of these communities by the end of 2023. As I mentioned in the past, Remark AI is able to differentiate ourselves from competitors. Because one, we offer a platform, not a point solution. No customer wants to handle 15 different vendors. Two, our platform is tried and tested. No customer wants to be the guinea pig. For example, in the fourth quarter, Remark AI was able to demonstrate the uniqueness of our large crowd scale people counting solution, which differentiates from individualized people counting that is limited in the quantity measure. This tool was effectively applied during the 2022 New Year's Eve celebrations in both the densely populated cities of Edinburgh, Scotland and Seoul, Korea, giving us the credibility in working globally with large metropolitan cities. Three. the quote, "secret sauce" of our AI platform is the ability to train our algorithms 3 times as fast as our competitors while only using a limited amount of datasets. This means we are able to adapt to our customer needs quickly and provide a new solution if not readily available in the market. The well-known saying, great things happen when preparation meets opportunity applies to Remark AI. Since we began building our platform almost eight years ago, we have now created a system which can provide the tools for businesses to run more efficiently and effectively and to provide an immediate ROI. In coming out of COVID, we are seeing unprecedented need for our AI platform in many different industries. Due to the strength of our core technology, we are then able to compete to win the business and in addition, create solutions that have never been introduced before in the industry. For example, as I've mentioned in the past, we have introduced the first global AI-based aviation platform, where both airline and airport operators can use to run their business in a much more effective manner. For example, in the past, it took 1 hour with a crew of 10 people to check the plane engine blades for wear and tear, like burnt spots that can affect the plane's safety and energy usage. With Remark AI, the airline operator now needs only 10 minutes and 1 person to do the same thing. More traditionally, when a plane lands, the airport operator has problems tracking all the different vendors and how much time it takes each one to service the plane. Again, with Remark AI, we are able to help them keep track and the airplanes honest, airplane vendors honest. Finally, when the airplane engine goes through general inspection to do with Rolls-Royce or Whitney Pratt, there always is a difficulty to keep track of the 500+ distinctive parts that make up the engine. Using our computer vision technologies, we are able to make sure every nut and bolts and tags are properly installed and secured and have no missing pieces before the engine is installed to the airplane. Our solutions have never been offered before until Remark AI has introduced it. Remark is pursuing recurring revenue streams that leverage our AI-powered solutions for the public and private sectors that include any large gatherings of people that require safety, such as sporting events and touring locations. As well as the education, public safety, retail, and transportation markets. We focus on large total addressable markets that can scale quickly and benefit from our AI-powered software to improve our customers' operations and generate an immediate return on investment from increased safety, reducing incidents, as well as cost savings from efficient teamwork. We are a solutions provider that sells to well-funded programs which already have the budgets pre-allocated as part of their security and infrastructure investments, thereby providing more visibility in a cyclical, economically dependent business. We actively partner with existing sales and solutions partners whose sales of $100 million+ will accelerate with our product capabilities and have the current distribution and customer relationships in the markets we are pursuing. An example of this partnership is with Netwatch, a security company that has built a proactive company to provide 24/7 real-time security monitoring, augmenting an organization's existing security force. When a trespasser enters a property illegally, Netwatch's monitoring center broadcasts a real-time warning to the trespasser while notifying the appropriate security personnel. Like Remark, Netwatch has successfully deployed internationally and is now seeking to grow that U.S. business. They were looking for an effective AI-powered solution to enhance their product offerings, which led them to Remark. One of the first markets we looked at in the public sector was the yellow school bus market, helping operators with safety and security solutions by counting the students on and off the bus to make sure they arrived at their destination safely. Remark AI-powered solution now enables Netwatch to offer bus occupancy counts, real-time rules-based notification for parents and teachers via SMS, email or GPS location tracking with map views of all active bus drivers, student attendance via a digital register roll call, and batch uploads of student information for the student database. To provide some numerical perspective, there are currently 480,000 school buses in operation in the U.S. We are currently conducting a pilot test with one of the largest school buses with a fleet of 55,000 buses. The typical school bus requires 3 video streams, front, middle, and back, and we charge based upon a suggested recurring subscription of $50 per month, which represents a total addressable market size of up to $860 million of recurring annual revenue and $99 million of recurring annual revenue if we were only to include the fleet size of our current pilot customer. Public transportation is another opportunity as there are additional 500,000 buses that serve the commercial sector. We are in active negotiations to provide similar services that also include bus driver and passenger safety, a vital concern in restoring the confidence of customers by providing accountability and peace of mind. Public and venue safety. Any large gathering of people requires a security solution that is dependable, highly accurate, and most importantly, helps provide safety. Our security solutions are currently being marketed and deployed in places like airports, arenas, parks, schools, stadiums through our strategic integration partners like Minuteman Security Technologies and established video management systems such as Genetec and Milestone. We are providing AI-powered solutions that help with people counting, smoke and fire detection, intrusion detection, and weapons detection through our Sentry and mobile platforms. The state of Nevada and Clark County has granted over $700 million to be spent upgrading school security as part of the Biden Infrastructure Bill, we are excited to actively be a participant of those programs through the current pilot tests we are running along with our partners, Milestone Systems, which we expect to start turning into revenue for the second half of 2023. Going into the health club space, this is another market that we are targeting. Health clubs require accountability and safety solutions for customers in real time. Currently, health clubs experience a potential liability whenever someone falls or gets injured while they're on the premises. For health clubs with pools, a lifeguard is always required to be on duty to reduce the risk of any accidental drownings. Remark's AI-powered solution provides an additional layer of protection by actively monitoring for falls and abnormal activities, including potential drownings, identifying and reporting those events on a real-time basis in order to help save lives. This is critical spending, not discretionary spending. We are focused on the mutual goals of positive cash flow generation and growth. Our business model is built upon annual multi-year recurring subscription revenue that provides a total turnkey AI-powered platform for our customers and partners. Just these three opportunities mentioned below alone potentially represent over $100 million of recurring domestic revenue captured over the next 18 months starting July 1st. There are many opportunities that we are at the 10-year line upon completion that we did not mention. This earnings call was meant to give you a taste of the numerous and diverse businesses that we are in the prime position to win. It only emphasizes the incredible opportunity of artificial intelligence and how well Remark is positioned to benefit from this. We always welcome serious current and potential shareholders to reach out to understand the full picture of our opportunities and why we are so bullish over the next 18 months. With that, I pass this over to Todd Brown. Thank you, ShING. My apologies for the interruption. 2022 has been a challenging year for our teams. The good news is that despite the COVID lockdowns that have caused us to have these problems with our operations, the good news is that China has ended its zero-COVID policy and we are working to resume our deployments at China Mobile retail branches, Bank of China's consumer banking branches, which have been closed to visitors since the onset of COVID, and at construction sites and school campuses. Despite the difficulties, the team was able to complete a number of projects, including construction projects and Smart Campus deployments at schools that prevented more of a decline in revenue during 2022 when compared to 2021. Revenue for 2022 totaled $11.7 million, reflecting a 27% decrease from the $16 million during 2021. First of all, we'll address the U.S. revenue, which declined primarily because in the prior year we performed $2.8 million worth of AI data intelligence services and advertising services related to a daily fantasy sports project during 2021. Did not repeat such a project in 2022. We also experienced a decline in demand for thermal imaging products that reduced our revenue from the U.S. by approximately $0.4 million in comparison to 2021. Of course, from China, revenue decreased, $11.4 million was the number in 2022 compared to $12.12 million in 2021. Of course, those COVID restrictions that we've discussed, that were implemented and continued in many cities across China well into the fourth quarter of 2022, was the main cause. Those measures prevented our teams from being able to get out to many of the project sites and those implementations that were not able to be completed in the current year, we expect will start to pick up in the second quarter of 2023. Our operating loss of $21.3 million during 2022 reflected an increase of $7.4 million from an operating loss of $13.9 million during 2021. Several large drivers caused that increase in operating loss, including the fact that the prior year, 2021, included a $1.5 million recovery of marketing costs from our China business partner, while we had no similar activity in 2022. An increase of $2.6 million in our provision for bad debt related to the COVID restrictions that affected us, and an increase of approximately one and a half million dollars in expenses related to our focused effort on business development, which has resulted in the expected business Shing has described earlier. Net loss totaled $55.5 million or $5.22 per diluted share during 2022, compared to net income of twenty-seven and a half million or $2.70 per diluted share during fiscal 2021. The prior fiscal year included a $43.6 million non-operating gain on the revaluation of the company's investment in the common stock of Sharecare. The value of that investment since declined significantly, and that was primarily a result of macroeconomic and stock market conditions, such that when we disposed of the investment through sales and in partial settlement of our debt, a $26.4 million loss on investment resulted. Our interest expense increased to approximately $6 million during 2022, from an amount of $2.3 million in 2021, and that was primarily due to an increase in our debt principal outstanding as well as debt discount on the new debt. Cash at December 31, 2022 totaled approximately $50,000 compared to a cash balance of $14.2 million at December 2021, December 31, 2021. Net cash used in operating activities during 2022 was $16.6 million. As previously disclosed, on October 6, 2022, we obtained an equity line of credit pursuant to which, after certain conditions are met, we can sell our common stock to Ionic Ventures LLC in exchange for as much as $50 million. Finally, a reminder that we effected a one-for-10 reverse stock split on December 21, 2022, and our disclosures in our 10-K will retroactively reflect that reverse stock split. With that, I will turn the call back over to Fay Tian. Thank you, Todd. We can open the floor now for the Q&A. Alicia, could you please tell the instructions for the Q&A for all participants? Thank you. Of course. No problem. We will now be conducting a question answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press Star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. Thank you. Our first question is from Steve Wagner with Integrity Wealth. Please proceed with your question. Hi, everybody. Hi, Fay. Hi, Shing. Hi, Todd. Thank you for all the detailed information, Shing, on all of the business initiatives. I've got a few questions, I think some for you and probably some for Troy. The first one, I mean, it's intriguing that you talk about that you've got a ChatGPT product. I'd love to hear more about that. You know, and just in connection with that, can you talk about how generative AI is different from the, you know, the computer vision AI that you guys have been talking about? Hi, Steve. Sure. on the generative AI, you know, when we say we've launched a kind of a ChatGPT rival or something like that. You know, we've been doing AI for a long time. I think our first major product was building very large language models. This was dating back to 2017, 2018. We've been doing this for a while. you know, the difficulty though back then was no one was paying for it. It was very hard for us to, you know, continue to, you know, pursue that business if no one was ready to pay for it then. We're certainly excited, you know, certainly with OpenAI success, that, you know, potentially from a revenue standpoint, it opens it up for a lot of people, you know. Obviously for them to get to this point, you know, they have incurred a lot of losses to get there. We wouldn't have been well-positioned to handle it. Instead of focusing on that, just say over the last five years, what people were paying for, what businesses were paying for was for computer vision. Really that's what we specialize in, is really putting the brains behind the camera and interpreting what's happening there. With the ChatGPT service, we're now able to upsell the businesses that we work with, right? Say, for example, as I mentioned in the speech with the, whether it's a construction project that has to do with a building, whether it has to do with a cement factory or a power plant, not only are we handling the front and back office, you know, in terms of their operations using our AI, but now we're able to use our generated AI to help them with design services. We're seeing a lot of demand for that right now. Um, That was the first question. Yeah. Yeah. Please. Yeah. Go ahead. Was there anything else you wanted to add to that? No. I think that's, I think that, you know, at least I think that addresses it. Okay. Yeah, let me know. Yeah. I would like to get a little more information on some of these initiatives. For example. By the way, it sounds like you guys are just busier than heck with all sorts of different verticals. You know, we obviously, as shareholders out there, are very relieved to hear that. I could hear confidence in your voice, and that means a lot to us. I do wanna though dive in first to China. I was intrigued by the one comment there that you've got these 11, you did 11 additional installations by the end of 2022 on the Smart Construction solution there, and that you're getting $100,000 in revenue for each one. Can you unpack that a little bit? Is that a lump sum? Is that projected revenue over a period of time? Is it subscription-based? Help us with that. Well, you know, construction projects in general, you know, after two years the project's been built, right? It's during the life of the project. Okay. Right now, it's during the life of the project. Just say that as long as they use, as long as we get deployed in the system, it generates about $100,000 in revenue. The upside to this is, couple things. One is as our customers are more comfortable in using AI, helping their construction business, that number will go up, you know, obviously as they subscribe to more services that we provide. That's one. Second of all is that they'll give us more projects to implement our AI. I think those are the two upside factors for here. We work with the world's largest construction company. They work on 7,000 projects annually. There's massive upside for us. Like any large company, with a great reputation, they move slowly and you need to prove, you know, what you say, what you do is, you know, what you say is what you do. We're doing that now. Certainly now that construction is resuming, we expect to see that number grow. Excellent. Can you give us a little bit of like understanding, of what the upfront costs are for the company in that? Is this all? It's obviously there's some hardware, there's software involved. How does that work? You know, it's used. A lot of these construction companies already have cameras. We're just basically installing our AI boxes to oversee the construction site or to, you know, help manage their workforce. There's not really that much upfront cost anymore. In the beginning, both sides were trying to understand, you know, how to use AI, right? Now it's been several years, and I think both sides are getting better. They're getting more comfortable using it. We're understanding it, how to implement, because each construction site is different. You know, it's exciting. I mean, I One point I think on this construction is because we've had this experience working with them, you know, it's now opened up a lot of other opportunities, one of which, as you mentioned, is in the Middle East. You know, potentially you've been reading probably in the papers of one of the biggest smart cities in the world... Right. -being created, right? They currently have, I think 40,000 construction workers, and that's growing up to 500,000 construction workers, you know, as we finish the different projects over the next five years. That's a massive opportunity for us because nobody in the world, really, you know, has been able to manage these large scale projects. We haven't either, but we have a lot of experience in dealing with the world's largest construction company who build these large factories and all that. You know, we're very optimistic about how we will enter the Middle East, and we expect more things to come over the next three to six months regarding that. That sounds good. Very intrigued by your comment, your commentary on being profitable by the end of 2023. I can only imagine what that would, what, you know, what that would do to the share price. That aside, I mean, how is that gonna be possible? I mean, you guys, you know, obviously there's some non-cash charges in here, and so I get all that. I mean, the loss isn't as big as what the headline numbers are gonna show, but still... Yeah. It's a pretty significant loss. While you'll still have a loss for 2023, obviously, you'll be profitable by the end of 2023. I mean, Okay. I would- It seems like a stretch. I mean, let's define... Yeah, define profitability for us. Yeah. I would just break that down to, you know, I'd break down the question into two answers. Number one. Sure. You have to compare apples to apples. Right. If you were to compare us against other, AI companies out, like real AI companies out there, whether they're public or private, they're losing hundreds and hundreds of millions of dollars, you know, generating, roughly the same amount of revenue, if not lower than we are. Yet they trade at a significant, premium to us in terms of valuation, right? Right. you know, no one's saying, "Hey, we're creating magic." You know, if there is another company out there that's doing it profitably, we'd love to learn which company that is, and we'd love to learn from them. There just isn't. That's one. Then number two, from a revenue standpoint, you know, the example that we can just use from is the one I just used in our speech with the school buses. This is a massive opportunity, if you just break it down, you know, using over 60,000 buses to install, this is them coming to us, to install 3 cameras per bus, at $50 a month. Mm-hmm. 150, times 12, right? Times, 50,000, just to make math easy. Sure. That's a very large number, right? Yeah. These are just. That's on a recurring basis. Now, say, for example, we don't win the entire fleet or they're slower, even at a half of that is still very significant. Right. The bottom line is, as I've said previously, there are not a lot of groups out there that provide the breadth and depth of our platform. You know, they might have one solution where it's saying, "Oh, let me just count how many people are coming up and down, you know, through the bus," but they don't handle all the other solutions that any customer wants. Right. No customer wants to handle a lot of different vendors. We're seeing that as a great opportunity for us. It's not just with school buses. You know, now you're even talking with EV buses, which are going under the same type of situation. In that particular case, it's not just the bus itself, it's the bus station, it's the charging station. These are all components where potentially we can upsell our AI to. I think we're having very deep conversations with kind of the main players in that market. All right. Fair enough. I appreciate that. Let's talk a little bit about the awareness of the company. Obviously, the majority of investors today are, you know, individual investors, you know, day traders, short sellers, you know, some semi, you know, long-term people, men and women. What can you guys do or what are you doing to regain some kind of coverage? I know we had Roth before, but then they went in a different direction. Some potential, you know, stronger hands. I know a lot of institutions won't look at a company with a market valuation where we're at right now, but, you know, there are hedge funds out there that will, and there are some other special situation type funds that will. I'm just curious what you guys have in store there. I think it comes down to two things. One is, you know, very soon, ourselves and our customers will be able to announce who we're working with, and the customers will be comfortable with us disclosing who they are, right? Good. I think that brings good credibility to what we're doing. Having said that, I don't think we can be. You know, you don't get into such details and such specifics unless we have a real customer at hand. You know, so I feel comfortable on that front. The second part is the exploration of very deep strategic partners. What I mean by that is, you know, it is very exciting to talk about all the different businesses and verticals that we're potentially getting into. What gets lost is the real core, and as I said, in the speech, is the secret sauce of our business. That's the core technology value, and that's the ability to train our algorithms three times as fast as our competitors and not needing a vast quantity of datasets to be able to train the algorithms. Okay? Mm-hmm. A true technology partner, people that really do understand the technology will be attracted to that. We are in discussions with that. Okay. You know. Got it. Won't disclose, you know, kind of timetable, but just the fact that we are in discussions regarding that. Okay. All right. Sounds good. Maybe offline we can get together and have a more in-depth conversation. Thank you guys so much for your time. It sounds like a lot of stuff is happening, and we'll look forward with interest. Have a great afternoon. Thanks. Thanks, Steve. Got it. Bye. There are no further questions at this time. I would like to turn the floor back over to Fay Tian for closing comments. Thank you, Alicia, and thank you everyone for participating in Remark Holdings' Fiscal 2022 Financial Results Conference Call. A replay will be available in approximately four hours through the same link issued in our April 4 press release. Have a good evening. Thank you. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.