There we go. All right. We're Unusual Machines, or known as UMAC. We're traded on the New York Stock Exchange. I'm Brian Hoff, CFO. Thank you for joining us today and learning about drones and drone components. My lawyers always want me to say this. We'll just say, this will contain forward-looking statements. You know the rest. We'll go through a little bit about what we do, what we sell, our growth strategy in this market. It's been a very hot market for anybody who's been following. If you're new to it, we'll walk through what that aspect looks like. The legislation that's driving some of these pieces for us, how our balance sheet and financial profile really is going to enable us to go do this in the future. Okay. Plain and simple, we are drone components. We manufacture these items. You can see them at our booth as well when you stop by. These are done in Orlando, here in the U.S. This includes motors, flight controllers, ESCs, cameras, headsets. We just did an acquisition that is pending closing probably in the next 45-60 days, I'd guess, once they finish their audit. It's Upgrade Energy, t hey're based out in L.A. The primary piece for us in this is we want to go after high volume with what we'll see as we get into this. With conflicts in Ukraine, Iran, these components have been done in China for the last 20, 30, 40 years. Bringing that with the conflicts that are ongoing, it's needed to bring them to the U.S. With the National Defense Authorization Act, which we'll go into a little bit more depth in a little bit, that alone has said, "Okay, we now need to bring this into the U.S." You add in the FCC in December. That has also enabled to say drone components need to be made here. The supply chain risks within. If everything was done in China, there is a conflict with them. We need to make sure that supply chain is secure. We started doing this. The growth has been tremendous over the last year. We're continuing to just build these products out. The size of the drone for these products. These are small, under 55 lbs. It's called Group 1 drones. These are low-cost, attritable, one-way, maybe a strike drone. These things can be five to 10 inches and very fast. You'll see, again, when you come over to the booth, you'll see the headsets. These are first-person views. You'll see the pilot is going to wear a headset that's kind of like a virtual reality headset. That's going to be giving you a video transmission from the drone to the pilot. You can maneuver so that way you don't have to have a visual line of sight when you're flying it. That's going to be very particular in the defense side. Here's a breakout of what our components look like on the drone. This also gives you an understanding of what the TAM is going to look like, at least on just the defense side. We'll also talk about what it's going to go beyond the defense side, which is what we're after. Today, Unusual Machines is not supplying directly to the defense. We will be a B2B2G customer, which means that we are supplying all the OEM drone manufacturers that are going after those contracts. The Department of War has put out a program. It's called Drone Dominance or the Gauntlet program. This year alone, they're making 90,000 of these drones in just that one program. As we add the batteries, you're probably looking that we're probably close to $1,000 per drone. In the phase one or year one of the Drone Dominance program, there'll be 90,000 drones this year, 250,000 next year, 300,000 plus in 2028. You're also going to have PBAS and other defense programs that are going to be utilizing all these parts, and that's again, driven by some of those legislation items. Our customers, they may buy the full system from us. They may buy a single part. You're not going to find a lot of these parts that are made in the United States. A lot of this is driven based on just you're not going to get it at scale. That's what we're after. We're getting a tremendous amount of demand. As we look at this year alone, we can't keep up with the demand. It's just so hot right now. Between the supply chains, as we have our raw materials that we then make these drone components, we're trying to source that outside of China as well. As a part of the legislation, we can still source our components, our materials outside of China. However, we manufacture it in the United States. We could still get potential pieces from China, but we are looking to go completely 100% away from China. If you look at probably the longest lead item is probably magnets. To source reliable magnets for our motors, we're going to Japan. That takes nine months just to get those pieces in place. We need to think about what we're doing today, nine months from now, right? On. We're just having kind of revolving pieces. The supply chain is long, and then we've also enabled our manufacturing capacity to really drive it, and you'll see here as we get into another slide, which I'm going to jump here for a second. Over last year, we've raised about $400 million of capital, and that's really to help with this kind of curve. We have to invest between CapEx, our supplies and materials. We are enabling the growth right now. We're trying to capture as much of the demand as possible. We're not going after trying to say, "Hey, we want to break even on cash flow" and those aspects right now. We are trying to get as much of the demand. We want to be the top Tier1 component supplier for this industry. We are after making sure we have the right number of facilities, hiring a tremendous amount of people. We've grown. We're over 220 employees today. A year ago, as I've told some of you, we were 20 people last year. It's going to ramp up. We could see ourselves being over 500 by the end of the year. We're at five facilities. We're looking to add another facility. We're going to bring battery production into Orlando as well. We'll also dual process out in L.A., where Upgrade Energy is at. They're expanding their facilities. Currently, they're at about one line right now. We're helping enable them to just do six in their capacity in L.A. We're also going to get them to help us build out in Orlando. Can you speak a little bit about the competition and the competitive landscape? Yes. I can. I've got a slide here. In a second, I'll talk to you about that in a minute. Really, what are we using all that money that we've raised for? It's going to be to go and enable all of this. Go capture it. We're less worried about it. Grow as quickly as possible. Day to day is just nuts, and we're just adding. Again, we'll add 30 to 40 people in a single day sometimes, depending on where we're at. Our motor line is at still three shifts, 24/5. We've got two shifts now in our headset facility. We've got two shifts in our assembly building, and we'll do multiple shifts in batteries as well when that's ready. Coming back here real quick to what are the segments that we in. If we look at our history, we started as just a retail shop. We were Rotor Riot, Fat Shark, kind of sold it through an e-commerce platform to hobbyists, enthusiasts. Make some cool YouTube videos. Check it out at Rotor Riot on YouTube. Some very neat stuff. They still produce it today. That's still a business that we have, but that's not the primary focus. Right now, we're in the defense bubble is where we're at. It's driving a lot of the demand, enabling the growth, especially with that legislation, and we're going to continue to capture it, and we're doing that. Now, we maintain our pricing, our margins, capacity, and scale even for the next waves beyond this. If we look beyond when the defense is, it's still going to be there. It will always be there, but we also want to enable the enterprise and the consumer part. DJI, which is the largest and probably the best drone, right? It's a great product. With the FCC ban that happened in December, they can no longer have DJI drones here in the U.S. That's a $10 billion market in just DJI drones. DJI started as a component manufacturer for drones. We want to continue to enable what that's going to look like. We want to make sure our pricing is there. We also have, when drone delivery starts happening, we're still waiting for some FAA regulation to make sure that the beyond visual line of sight can happen. We want to make sure when you're ready to get your Uber Eats delivered here at the conference, it's going to be done by drone, right? That's the next stage of what we're after as well. You're going to build your own drone like DJI? As of today, no. There's a lot of aspects that go into it. Maybe in the future. Can't really say. Who knows? It's an ambition of ours for sure to want to go do it. That's going to require a lot of additional engineering capacity and what that's going to be looking like. Right now, our core piece is focus on getting the drone components just up to scale as quickly as possible and make sure we can handle those pieces. I've mentioned this, but again, it all started with, and this is kind of our original thesis was the National Defense Authorization Act, which really had a lot of bipartisan support. Do I think any of this regulation is going to get reversed? I don't. I think this is going to be here forever. That originally was in 2024 that essentially said you can't have drones if you're using federal dollars. You cannot buy these pieces from covered countries. That was then bolstered in December of 2025 with the FCC now saying you can't produce drones, and we didn't expect this, but also drone components have to be done in the U.S. That's really kicked things into high gear for us. As we said, Drone Dominance, you can see what this is, but we're getting so much inbound, there's not enough time to keep up. I'll jump to the competitors here. There are other competitors. If we look at it from other countries but also scale. There's two different pieces. Scale usually also comes with price. If we're looking at you want to produce a large amount of motors That's going to also, you have to have the resources, the capacity to be able to do it, the supply chain. We can have other motor manufacturers, but if you're not going to do it at the scale, your prices are going to be two, three, four times as high as ours. Right? It depends on which component you're talking about, but we do have some competitors here, but their prices are going to be significantly more. We aren't as worried about the other international markets right now because there's enough demand in the United States just alone to handle all the capacity. We're not overly focused on international at the moment. You add in counter-UAS, and those types of things, it's going to use the same type of components when we're talking about it. There's a large demand. From coming back to this, really, we've got a large amount of capital between cash. We also make strategic investments in other drone and drone-adjacent companies, whether that's suppliers, whether it's potential customers or customers, right? We just made another $30 million investment in PowerUs, right? That's a customer, and it's essentially helping enable their process as well and provide funding. We're very smart about what we want to do in strategic investments. If you look at some of our earnings, it's an additional capital driver for us. I think in the few investments that we've made, in turn, that's driven about another $20 million of cash directly to us. We've just got history here. Our team is great at understanding dual sourcing our materials, right? They know they've got long industry leads within both our vendors, but also our customers. They've been around for a long time, so as you know, this industry hasn't been around forever, but it doesn't seem like a long time when you look at some of those dates, but for this industry, it is. Looking at our history, this is an interesting slide as well. If you look and think about this and what we've talked about, if you've listened to some of our other presentations, is what's the timing of when we hired some people? We've made initial investments in Q2 of 2025 to go purchase our initial supplies and our equipment to build motors, right? We hired our first batch of employees. We grew from 20 to about 40 in Q3. A quarter later, our revenue doubled. Right? We went from 40 to 81. Our revenue doubled the following quarter. We went from 81 to 140. Our revenue doubled. We've now gone from 140 to 220. Right? It's the demand. You can see how those pieces, and it's just every day, it's trying to just keep up with the pace. Looking at the margins, I know my first thought is, "Okay, are you having a margin issue?" We anticipated this as well. You can't hire 100+ manufacturing employees without training what our process is. When we first started our manufacturing facility for motors, the first batch, be honest, it took time to understand the process, right? We acquired a company called Rotor Lab in Australia. They helped from the engineering aspects to make sure that we didn't have another 12 months to figure out what the heck are we doing, right? We got version two before the motors almost even fully turned on, right, before we started hiring our second and third shifts. We anticipated a drop in those margins from scrap rates and those types of things. Those have already been brought back up into very effective yield rates that we would anticipate into the 90% range. Do we expect that there could continue to be some margin in the low 30s? Yes. Do we expect it to get back to about 40%, where we like to land? Absolutely. It might take us another couple of quarters to do that as we continue to go and invest in the growth of what we're trying to go do. Especially as we get batteries manufacturing ramp, right, if we're doing those types of pieces. There will be potential additional margin drops for a period of time. The other question we get asked all the time is: Can you be cash flow break even? When does the profit start happening? Right now, we're focused primarily on the top line. Yes, we care about all those pieces. We do not operationally burn a lot of cash. Now, we go put money into inventory. We are making $75 million-$80 million worth of inventory purchases right now that are going to be spread throughout this year to enable us for even next year. Operationally, we burn maybe $1 million, $1.5 million a quarter on just operational cash. We have over $250 million of cash right now. We're not looking that it's going to be a long piece, but why hold that much cash? As you look at that previous chart with the curves and the timing it takes, if we have to continue to buy inventory for six to nine months from now, we need to be able to sustain that kind of timing before that inventory turn comes back into play. We're setting ourselves up because if our customers want to invest in us as a primary supplier, they want to make sure that we're going to be here in six more months and that we're not going to drown in our own hardware type stuff, right? The same type of things that you'd see in other hardware businesses. Healthy balance sheet, a lot of growth potential, still going to continue to grow. As I said, we're looking to be over 500 employees probably by the end of the year. Cap table, extremely clean. All common. Nothing-- This was as of March. This does not include any of the potential Upgrade Energy shares that we're going to do and issue. Once that deal closes, that'll be reflective in here as well. Then we have an EIP. Here's the team. It's continued to grow. When we started, we had our exec team here, and again, long history with it, but we're building out that next layer of who we're at and continuing to go down the tree. This is really going to continue to enable our growth. Some great manufacturing team members here as well with what they've been doing and their backgrounds. Like Brad, he's come from Tesla, done some automation in relation to what that's going to be. As I focus on motors, we are building out our highly automated line right now. We purchased this back in April. It's now getting delivered and installed in Orlando. Right now, we do 30,000 a month on just our partially automated line. The highly automated line, still a couple of processes that are manual-ish. That's going to take us from 30,000 to 120,000 a month just to continue to do it, and we could probably even use three, four, five lines just to meet up with demand right now. We'll continue to make those investments as we get there. It's going to be really driven by this amazing team, what we're after. A lot in there, I know in a short window of time, but I also want to leave you guys some time for questions as well. Yeah. Your slide on gross margin made a lot of sense. I don't see a blind spot. What is the target gross margin? 40%? W e're going to try and get back to 40%, yes. It's going to be probably in the 35%-37% is what we'll see as our normalized, then when we really hit our capacity, we're going to aim for 40%. While you're investing for growth, what do you think your OpEx will be? I'll answer that in a way of, if we were to go right now, I think if we wanted to be like a break-even cash flow today, you'd probably be looking at $65 million - $70 million worth of annualized revenue. Right? I think our OpEx is going to continue to grow a little bit. It's not going to grow in that same fashion that the revenue is. With our market cap, that's going to look to be crossing over the $700 million mark. We're going to now have to be Sarbanes-Oxley required, right? That's going to be $1 million alone, probably between audit and SOX testing, right? I think you'll see some in your OpEx grow. At the same time, we've started building out majority of that team at the same time. Now, you'll see some growth within probably your sales and marketing teams, right? Shipping, those types of costs are going to continue, but it's going to grow. I think you'll get to a normalized piece probably within sometime this year. Yeah. For that very first quarter, were you affected at all by the government shutdown? Yes, to an extent, but also at the same time, not really. Here's the reason why. We had raised enough cash at the same time, early enough. We continued to manufacture so we can be there when our customers need it. Right? We're not here to go and supply directly to the federal government, right? When our customers needed the parts, because then the government reopens, they say, "Hey, I still need this." Right? "We were shut down, but you can't." We were there and had already started producing all that stuff. The hardest piece from a government shutdown is just the reliability on when you're going to actually say you need these drone pieces, right? Because it helps us from our demand and capacity planning as well. That's probably the biggest impact. We aren't necessarily shutting down from like, "Hey, we're going to stop production," because I've got a bunch of other customers and different things that are going to continue to need it, beyond just even the federal side. Yep. What's the timeline for Phase I? Phase I is this year. It's 90,000. That's broken into two parts. Part one of this year was, I believe, 30,000 drones, and that's already been down selected to, there was 11 awarded winners of that. We have over half of them and even more as they continue to say, "Okay, here's where we're at." Phase II's another 60,000, and the primary piece of the 60,000 is, and there's 40 some people competing for that, and I think it was actually ongoing last week, maybe even this week. That is also going to understand and test your supply chain, right? First one was, let's understand your product. Is it going to meet the requirements? Second part is going to be, what's your supply chain resiliency? I need 1,500 drones manufactured and processed on this timeline. Right? That's a September process. That other 60,000 is going to be around Q3. Next year, I don't think there's breakdowns fully into what that's going to be, but 250,000 next year. I think it's 350,000 in 2028. It'll be somewhat in advance of some of those pieces. We're also doing certain pieces that we don't even need to worry about, like, hey, we're not making it a mandatory piece, but if you want to place a contingent PO with us, we are happy to do that. If they don't win, we've got other customers that are going to take that demand from us again. We have, again, if you want to see the Drone Dominance, you'd see it around the same timeline, probably a little in advance of what that's going to look like, just because they're going to need their timing from. Again, if they buy one part from us or the full system, they're still going to need time to then do whatever other things that they're going to need, right? Software. If they had other parts that they're going to need adding into it, if they want to add their own camera, whatever. Right? They'll have that timing, so it'll be roughly the same timeline. Can you shed a little bit more light on the different divisions? I saw that you have a headset, you have a manufacturing. Yep I think today that's primarily what we're after. We have a headset facility, a camera, batteries, motors. We sell frames, ESCs, and flight controllers, which we have some partners that we do as well, right? We're not looking to have our own PCB shop. We'll have our products and [inaudible] You're just basically assembling. You're not doing the display. As of today, no. Okay. On the headsets. We will purchase those, and we assemble those. Motors, yes, we actually assemble the entirety of those. Could there be a contract manufacturer that you plan on working with at some point? Yes. Okay. Yep. Just something competitive advantage. I guess the regulatory framework favorable supply service, right? Yes. As the U.S. drone ecosystem continues to grow, what would prevent one of your bigger competitors just do the same to you? Two pieces, capital. We've got a lot of capital. Second piece, speed of execution for us. We are trying to capture as much as possible. If you're a drone manufacturer that has a reliable motor manufacturer, like you can just get reliable motors from someone, you got other problems to go solve. You don't want to go and cycle somebody else out. I think those are the biggest pieces. Speed for us is capturing as much market as possible. I know we only have one minute left or none. Do we have time for one more? One more. Go ahead. Yeah. A couple of weeks ago, The Wall Street Journal published an article about the Trump administration being asked to fund drone companies, Unusual Machines was mentioned. Can you just comment on that and then talk about how the relationship with the current administration has been like for Unusual? Yeah. We did get named. I think there's aspects that we're looking for always other sources of funding as well, right? There is aspects and avenues that we look at that's beyond it. We haven't been awarded any aspects to it yet, but we're going through the normal channels at the same time, right? There's no specific pieces that are like, hey, just because we have certain advisors for us, that doesn't mean that we're getting any preferential pieces on it. We are looking at other aspects, but again, we'll wait and see how that all shakes out and what it does to kind of continue to fund our growth plans. Second piece to that, again, I think the administration, regardless of which one, there's been tremendous bipartisan support for both all the legislation. I think it's going to continue regardless of what the elections bring for us. From a defense side, drones are needed very much. Thank you all for attending. That was the quickest 30 minutes ever, so thank you.