Airgain, Inc. Aktie

Good afternoon. Welcome to Airgain's First Quarter 2026 Conference Call. My name is Sherry, and I will be your operator for today's call. Joining us today are Airgain's President and CEO, Jacob Suen; and CFO, Michael Elbaz. As a reminder, this call will be recorded and will be made available for replay via the link found in the Investor Relations section of Airgain's website at investors.airgain.com. [Operator Instructions]

I caution listeners that during this call, Airgain's management will be making forward-looking statements about future events as well as Airgain's business strategy and future financial and operating performance. Actual results could differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with the company's business. These forward-looking statements are qualified by the cautionary statements contained in today's earnings release and Airgain's SEC filings. The conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, May 6, 2026. Airgain undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call.

In addition, this conference call will include a discussion of non-GAAP financial measures. Please see today's earnings release for further details, including a reconciliation of GAAP to non-GAAP results.

I would now like to turn the call over to Airgain's CEO, Jacob Suen. Jacob?

Good afternoon, everyone, and thank you for joining us. The first quarter marked a solid start to 2026 as we began converting the strategic groundwork we laid last year into broader commercial momentum across the business. Over the past several years, we have been transforming Airgain into a higher-value system-level connectivity company. In Q1, that transformation showed up through customer wins, expanded platform capabilities and deeper commercial engagements across our core markets and growth platforms.

Let me start with our platform initiatives. First, we expand AirgainConnect's capabilities through the acquisition of the HPUE MegaFi 2 assets from Nextivity. This acquisition expands our portfolio and strengthens our vehicle gateway capabilities across public safety, utility and enterprise fleet applications. It also broadens what we can offer to our customers. Some customers need a fully integrated vehicle gateway. Others want a simpler high-power router solution. With AirgainConnect, we can now support a wider range of deployment needs, both AirgainConnect Fleet and AirgainConnect MegaFi 2 are part of the AT&T FirstNet offering, and customers can order these solutions directly through the AT&T Speed portal. We are also seeing encouraging progress in the AirgainConnect pipeline.

In March, we closed a Tier 2 customer in the energy sector that upgrades across multiple U.S. regions. This customer is deploying AirgainConnect across a fleet of more than 300 maintenance and service vehicles following field trials that demonstrated improved connectivity performance and ease of installation. As of last week, our pipeline includes more than 55 Tier 1 and Tier 2 opportunities, up roughly 40% from the approximately 40 Tier 1 and Tier 2 opportunities we mentioned on our last call. The mix is also becoming more attractive with most of these opportunities now coming from non-first responder markets. Importantly, these opportunities are also advancing through the funnel. More than 1/3 of our Tier 1 and Tier 2 opportunities are now in trial or post trial stages compared to a quarter on our last call. This gives us increasing confidence that the pipeline is not only broader but also moving closer to conversion.

At the same time, Tier 1 engagement continues to deepen with several opportunities becoming more strategic, while these larger opportunities take longer to convert we believe the pipeline is moving in the right direction. These emerging opportunities reinforce our view that the strategy we outlined on our last call is working and that AirgainConnect is positioned to become a more meaningful contributor as we move through 2026 and beyond.

Second, we continue to advance Lighthouse. In the U.S., we are now working with a business sponsor and a Tier 1 mobile network operator to progress towards a live enterprise trial. This moves Lighthouse from network validation into the business and commercial base. If the trial progresses as expected, we believe initial commercialization opportunities could begin towards the end of 2026 with a broader opportunity developing in 2027. This opportunity with the Tier 1 MNO is being driven by clear customer pain points around coverage, capacity and the cost of network upgrades. In many in-building environments, traditional solutions such as DAS or small cells can be expensive, disruptive and slow to deploy. Lighthouse gets customers a faster and more cost-effective path to upgrading from 4G to 5G coverage.

For indoor deployments, the value proposition is straightforward, better coverage, lower cost and faster deployment. For outdoor user cases, Lighthouse reduces coverage gaps and provides network performance benefits, non-disruptive integration and scalability. Based on our engagement with this Tier 1 MNO, we believe indoor deployments could represent the near-term opportunity with initial deployments targeted towards the end of this year. Outdoor deployments remain an important longer-term opportunity and are expected to follow a more expanded evaluation and commercialization cycle.

In the Middle East, our relationship with Omantel remained an important entry point. Deployment activity was paused due to the conflict in the region, but engagement is now ongoing, and we expect to move forward with initial deployments over the coming months. We continue to advance our road map for integrated 4G and 5G coverage solutions designed for challenging indoor and outdoor environments. This road map supports 4G and 5G co-location, expands the range of deployment scenarios we can address and strengthens the long-term commercial opportunity for Lighthouse. We are seeing customer interest in trialing the combined solution as units become available. As our engagement with the Tier 1 MNO and enterprise customers has progressed, we believe we now have a clear path to commercialization with our current product road map. As a result, we have realigned our resources and priorities to focus on accelerating commercialization and revenue generation.

Now turning to our core markets. In consumer, we secured a multiyear, multimillion dollar in-build antenna design win for a next-generation 5G home connectivity platform with a Tier 1 North American MNO with production units anticipated later this year. As expected, consumer revenue declined sequentially due to seasonality. Looking into Q2 we expect consumer revenue to remain relatively stable with underlying demand still healthy. The primary factor, we are monitoring in the near term is a supply constraint at the gateway level, particularly around memory availability and pricing. This is impacting our OEM's ability to ship finished systems and in turn, can affect the timing of our antenna shipments. At this point, this dynamic is limited to a single OEM serving cable operators. Based on feedback from this OEM, they are actively working to address the issue, and we believe the impact is temporary. As we mentioned earlier, we have secured 2 Tier 1 MNO design wins, and we remain on track for those programs to ramp in the second half of the year.

In enterprise IoT, momentum is building. We received a $4 million purchase order from a long-standing IoT solution customer with shipments expected to be completed this year including initial shipments in Q2. This order reflects the resumption of demand from this customer and improves our near-term visibility. We are also seeing continued traction across our embedded modem portfolio and expanding opportunities in emerging applications. We increased our IoT presence in robotics through a new design win with Coco Robotics, and we are seeing additional activity in adjacent areas such as storms, including preproduction shipments in Q2 for a new customer program focused on autonomous VTOL rotorcraft for defense and commercial applications.

Stepping back, Q1 reflects progress across our growth platforms in our core markets. Both enterprise and automotive grew sequentially. IoT momentum improved. AirgainConnect engagement product, Lighthouse move into more focused commercialization discussions and our consumer business remains supported by strong Tier 1 relationships. Just as important, our pipeline is broader and continues to expand. We enter this next phase with a more focused operating model, improving visibility and clear opportunities to convert customer engagement into revenue.

With that, I'll turn the call over to Michael.

Thank you, Jacob. Before diving into the numbers, please note that my review of our financial results and guidance refers to non-GAAP figures. Information about the non-GAAP financial measures, including GAAP to non-GAAP reconciliations can be found in our earnings release.

Now let's turn to our first quarter results. Q1 sales came in at $11.5 million which was at the midpoint of our guidance range. Enterprise sales were $5 million, up $0.7 million sequentially, driven by higher embedded modem sales. Automotive sales were $0.9 million, up $0.4 million sequentially, reflecting higher sales of AirgainConnect vehicle gateways. Consumer sales came in at $5.6 billion, sequentially down $1.7 million, primarily due to seasonal impact. Non-GAAP gross margin for the first quarter was 44.2% compared to 46.3% in the prior quarter and relatively flat year-over-year. The sequential decline was primarily due to a lower enterprise margin rate, driven by an unfavorable product mix.

Non-GAAP operating expenses for the first quarter amounted to $6.1 million while modestly higher sequentially due to typically higher first quarter marketing and trade show activities, operating expenses declined by 8% or $0.5 million year-over-year as we continue to optimize our OpEx model. In Q1, adjusted EBITDA was negative $0.9 million, $0.2 million lower than the midpoint of guidance. Non-GAAP EPS was negative $0.08 compared to negative $0.07 midpoint of guidance. As of March 31, 2026, our cash balance was $7.1 million relatively flat sequentially. Net cash proceeds from our ATM were $0.6 million.

Now moving to our outlook for the second quarter ending June 30, 2026. As a reminder, we provide quarterly guidance for sales, non-GAAP gross margin and expenses, non-GAAP EPS and adjusted EBITDA as we believe these metrics to be key indicators for the overall performance of our business. For the second quarter of 2026, we project sales to range from $12.5 million to $14.5 million with a midpoint of $13.5 million. The midpoint represents a 17% sequential increase driven by enterprise and automotive. We believe our outlook reflects improving demand visibility across the business and continued progress in converting the commercial traction Jacob discussed into revenue.

We expect non-GAAP gross margin for the second quarter to be in the range of 42.5% to 45.5% or 44% at the midpoint. We project operating expenses to decrease sequentially to approximately $5.8 million. Non-GAAP EPS is expected to be positive $0.01 at the midpoint of our guidance. Adjusted EBITDA is expected to be positive $0.2 million at the midpoint of our guidance. Overall, the actions we have taken over the past few quarters have improved our operating leverage and position us to convert top line growth more effectively into profitability.

Now I would like to turn the call back over to Jacob for his closing thoughts. Jacob?

Thanks, Michael. As we look ahead, we have good visibility into Q2 and see positive momentum for both our core and growth platforms for the rest of the year. Beyond Q2, we see a broader set of drivers. Demand in our consumer business remains healthy, and we expect improvement as supply constraints ease. IoT continues to build momentum through repeat orders and new application design wins. AirgainConnect is progressing from engagement toward conversion with growing activity across utility and enterprise markets, and Lighthouse is moving towards targeted commercial deployment in the U.S. and Middle East.

Taken together, these drivers reflect a more focused and better position business with a stronger platform portfolio, a broader pipeline and an operating model positioned for improved leverage as revenue scales. Our focus is execution, converting pipeline into deployments, driving growth and including profitability as we move through 2026.

Operator, we're now ready to take questions.

[Operator Instructions] Our first question is from Anthony Stoss with Craig-Hallum Capital Group.

Michael, I was trying to write as fast as I could. Can you just give me the revenue splits? I got consumer $5.6 million, but I missed auto and enterprise.

The guidance you meant, Tony?

No, the percent of revenue in the quarter that came from auto and same question for enterprise.

So auto would be about 40% approximately. I don't have the other numbers in front of me. And enterprise would be about higher actually, 50% approximately.

Enterprise 50%, auto 40% and Consumer 10%?

No, no, no. It's...

Yes. September is $5.6 million.

Yes. I'll have to come back to you on this, Tony. I don't have those numbers in front of me.

Yes, the bottom line is overall the enterprise and automotive, we're seeing a sequential growth, and we expect that momentum to continue. And consumer in Q1 was due to seasonality. So we also expect the consumer to improve throughout the year.

Perfect. And then Jacob, just getting on the...

Tony, the number is 49% on the consumer, 8% on the automotive and 43% on the enterprise in Q1.

Perfect. Related to the memory shortages, I get it. A lot of people are talking about it, thinking it's going to get worse throughout the remainder of the year. But given -- I guess the first part of the question is how much of your revenue was affected in Q1 as a result of not being able to ship? And then, Jacob, more longer-term picture, when do you think -- which quarter is it this year? Is it next year when you can get back to the kind of $7 million to $10 million in quarterly revenue on the consumer side?

So yes, Tony, this is Michael. So in terms of Q1 impact, we had no revenue impact from the shortages, and we had no gross margin impact from the shortages. In Q2, we are being conservative on the consumer. Typically, you would see that seasonal down in Q1, which we saw and a rebound in Q2. And right now, we are expecting to be relatively flat and mainly because one specific OEM is being impacted. They believe it's a temporary blip right now, and it will be worked out by the end of the quarter, but again, we're being conservative on that.

Yes. And regarding your questions about the consumer revenue, certainly, as we indicated, the good news is that we always have the stability regarding the MSOs. We are now adding the MNOs. We are now working on 2 major MNOs in the U.S. So that should help us well positioned for the rest of the year. Are we able to get to the $7 million to $8 million range like we used to have, we do have the path for that. Now is that going to be happening this year or next year? We don't know that yet, although it's trending very positively. We mentioned about the design win with the MNO, that should be in the latter part of this year.

Got it. And then my last question related to AirgainConnect. Are you seeing a speeding up of some of these trials or your ability to convert? It's great to see that Tier 2 energy customer. What's your feel on how quickly you can convert the trials into more signed deals?

So on the Tier 1 type of customers, we mentioned before, 12 to 18 months of the cycle time, and we are in the cycle time. The good news here is that the pipeline is changing favorably to us quarter-over-quarter. So for example, we mentioned on the call that we have a current pipeline of over 55 deals in Tier 1 and Tier 2 customers. 20% of that is Tier 1 customers. And of the 20% of that, the vast majority are for non-first responders. So they tend to be moving quicker. However, because those tend to be also strategic type of deals, they are also very much of a multilayer type of meetings, engagements, trials taking place.

And so we are basically on track to what we had mentioned about the 12- to 18-month cycle. On the Tier 2, we just mentioned that we closed a Tier 2 customer. Overall, the velocity of the design wins that we have, primarily on the Tier 3 and the Tier 2 so far is accelerating. Last year, we would be closing 1 deal per month. And this year, so far, up until May, it's been about 2 deals per month. I hope this is helpful.

Perfect.

Yes. Tony, also the Tier 1 opportunity size, the vehicle size is also getting bigger as we go after the non-first responder vehicles because a lot of these are large enterprise fleet. So we'll start to work on tens of thousands of vehicles instead of just several thousands or several hundred as in the case of the first responders.

Our next question is from Jaeson Schmidt with Lake Street Capital Markets.

Just looking at Lighthouse and that potential trial here in the U.S., what additional steps, if any, do you guys need to complete to continue to move that forward?

Jaeson, yes, Jacob here. So yes, it's actually a very significant milestone. And as I was alluding to in the call earlier, is the fact that -- basically, as far as the technology validation, that looks to be already proven with the trial we have done in the corporate office. And so now we are working with the business sponsor. So typically, they would not work with us to do a business sponsor until they feel very comfortable with the technology validation. So that phase is done. We are now working with them on their sales team to identify several potential customers that would be able to really take advantage of our Lighthouse product.

And these are customers as we work with this particular MNO where they actually have to walk away from deals previously due to lack of budget using existing system. So our solution are giving them a fraction of the cost otherwise. So as an example, where they have to have using a system that's going to be $4 per square foot, now we're going to be able to offer them a fraction of that, so they can meet that budget. So those are the customers that we are targeting, and we intend to get 1 or 2 of those customers for the live trial and hopefully, in turn, become permanent. So that's where we're at regarding the progress with this particular MNO. Now as you know, dealing with MNO, it takes time, although they're really seeing a unique value with our Lighthouse.

Okay. That's good to hear. And then looking at the consumer segment, understanding the near-term dynamics, but do you guys have confidence that you will see that rebound in Q3? Or is it just too early right now?

It's a bit early right now, but let me put it this way. The demand is very healthy and the demand, what we mentioned before last quarter is that we were expecting a modest growth on the consumer market across the year. So from a demand standpoint, it's there. It's a question of supply and the timing of it. I should also mention from a consumer business model itself, the way it's being set up and really is based upon the strong relationship we have with the service providers, the OEMs themselves, the CMs and the distribution channel as well, too.

And that gives us quite a bit of visibility, at least in the short term about some of the supply management that we have to do. The other piece also that I should mention is that typically, service providers have 2 or 3 OEMs. And typically, we are designed in with 2 OEMs. So if there is any type of supplier allocation being redone, for instance, we're still somewhat covered by it.

Okay. That's helpful. And then just the last one for me, and I'll jump back into queue. You're expecting a nice sequential downtick in operating expenses. Is this sort of a level we should feel comfortable with in the back half of the year? Or how should we be thinking about OpEx?

Yes. I think first half of the year, I believe, in 2026 is about 9% down compared to the first half of last year. As revenue grows, you would expect a modest uptick on that. But overall, our sense is that we definitely want to make sure that we have a very strong operating leverage so that when the top line grows and that top line should be having some higher gross margin than the corporate average. As it grows, then we really optimize our overall business model and be -- really offer some positive and accretive EBITDA margin in the long run.

At this time, this concludes our question-and-answer session. If your question was not answered, you may contact Airgain's Investor Relations team at [email protected]. I would now like to turn the call over to Mr. Suen for his closing remarks.

Thank you all for your thoughtful questions and for your continued interest in Airgain. If there's one key takeaway, it is that Airgain is a more focused and disciplined company with a stronger foundation and improving operating model and growing platform momentum. We believe the work we have done positions us to drive sustainable growth and improve profitability as we move through 2026 and beyond. We appreciate everyone joining us today and look forward to keeping you updated on our progress. Operator, you may now conclude the call.

Thank you for joining us today for Airgain's First Quarter 2026 earnings. You may now disconnect.

Good afternoon. Welcome to Airgain's Fourth Quarter and Full Year 2025 Conference Call. My name is Kevin, and I'll be your operator for today's call. Joining us today are Airgain's President and CEO, Jacob Suen; and CFO, Michael Elbaz. As a reminder, this call will be recorded and made available for replay via link found on the Investor Relations section of Airgain's website at investors.airgain.com. Following management's prepared remarks, the call will be open for questions from Airgain's covering analysts.

A caution for listeners that during this call, Airgain's management, we'll be making forward-looking statements about future events as well as Airgain's business strategy and future financial and operator performance. Actual results could differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with the company's business. These forward-looking statements are qualified by the cautionary statements contained in today's earnings release and in Airgain's SEC filings.

This conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, February 26, 2026. Airgain undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call. In addition, this conference call will include a discussion of non-GAAP financial measures. Please see today's earnings release for further details, including a reconciliation of GAAP to non-GAAP results.

Now I'd like to turn the call over to Airgain's CEO, Jacob Suen. Jacob, please go ahead.

Good afternoon, everyone. And thank you for joining us. First, I would like to reflect on 2025, which was a pivotal and highly productive year for Airgain as we executed against our long-term strategy and position the company for its next phase of growth. During the year, we strengthened the resilience of our existing business, improved margins and reinforce our financial foundation. We expanded our design win pipeline with Tier 1 service providers, securing important new programs that deepen our strategic customer relationships and position us for growth.

We also made significant progress advancing our AirgainConnect vehicle gateway platform in our lighthouse infrastructure platform. Both platforms achieved important technical validations, customer engagements and ecosystem milestones that move them closer to scaled commercial deployment. Together, these accomplishments marked an important transition again. Over the past several years, we have defined our strategy, develop differentiated platform solutions and validated them with customers. As we enter 2026, our focus is increasingly centered on commercial execution, converting our growing pipeline into deployments in scaling our platforms to drive sustainable long-term growth.

This transformation is loaded in Airgain's DNA our deep engineering expertise, system-level design capabilities and long-standing carrier relationships. By leveraging this strength we have deliberately repositioned Airgain beyond component level products into integrated connectivity platforms, [indiscernible] large and expanding opportunities across fleet, enterprise and infrastructure markets.

At the same time, we have remained disciplined in managing our business. We improved gross margins optimized our cost structure and focus our investments on the highest ROI opportunities. These actions have lowered our breakeven point and improve the scalability and resiliency of our business.

While fourth quarter revenue came in at the lower end of our guidance range. This was driven primarily by timing dynamics rather than any structural change in demand. Importantly, the strategic progress we have made has strengthened our competitive position, expand our growth opportunities and reinforce our confidence in Airgain's long-term outlook. With our existing business, providing a stable generating foundation and our strategic platforms advancing towards commercialization. We believe Airgain is entering an important phase focused on execution, scaling and realizing the significant opportunities ahead.

Let me begin with our core markets, starting with Consumer. Our Consumer business continues to perform well and remains a critical foundation for Airgain, benefiting from the transition to Wi-Fi 7 and our deep relationships with Tier 1 cable and mobile network operators. Consumer revenue reached $26.1 million for the full year, representing a 20% increase compared to 2024. Just as importantly, this business continues to deliver strong adjusted EBITDA profitability, reflecting the strength of our brand, technology leadership, strategic customer relationships and disciplined operating model.

Our Consumer business remains a critical strategic foundation for Airgain, providing durable revenue, strong cash generation and the financial stability to continue investing in and scaling our growth platforms. Historically, our Consumer business was primarily focused on leading MSOs, where we established strong incumbency positions and long-standing customer relationships. Over the past few years, we have successfully applied that same strategy and approach to Tier 1 MNOs, expanding our engagement into larger, longer duration programs.

As a result, we are increasingly involved early in the design cycle, working alongside customers as a strategic partner to help optimize system performance and connectivity architecture. We believe this deeper integration strengthens our incumbency and reinforces Airgain's position as a trusted connectivity partner across Tier 1 service providers as our solutions become embedded in next-generation broadband platforms.

This growing incumbency and the stickiness of our relationships with Tier 1 MNOs directly enabled our most recent design win. As you saw from our press release earlier this week, we secured a multiyear, multimillion dollar embedded antenna design win supporting a next-generation 5G home connectivity platform for a Tier 1 North America MNO. This program includes antenna systems for both a 5G fixed wireless access router and an in-home Wi-Fi extender and is expected to enter mass production later this year.

This win builds on our previously announced Wi-Fi 7 design win for a next-generation fiber broadband gateway with another Tier 1 North American MNO. In addition, a program we secured with a large European operator, 2 years ago is now ramping into production. In recent industry consolidation among Tier 1 MSOs has expanded our project opportunities and strengthen our design win pipeline. These design wins reinforce our brand's strength and validate our position as an incumbent connectivity partner with Tier 1 carriers.

Importantly, these relationships extend beyond our consumer business as customers Airgain as a trusted connectivity partner. They create strategic pathways for our AirgainConnect vehicle gateway platform and Lighthouse infrastructure platform, expanding our opportunity to support broader enterprise and infrastructure connectivity deployments.

While we expect consumer growth to be modest in 2026, we believe the depth of our customer relationships, expanding design win pipeline and growing incumbency position to provide a strong foundation for future growth as these programs scale to 2026 and into 2027.

Turning to our Enterprise market. We continue to sharpen our focus on higher-value opportunities while strengthening the profitability in strategic positioning of this business. IoT represented the majority of our Enterprise revenue in 2025. While revenue declined year-over-year, due to excess inventory at a large customer, which discussed previously, the profitability of this business improved significantly. Over the past year, we took deliberate actions to focus on our Skywire embedded modem portfolio, improving product mix, increasing gross margin and optimizing operating expenses. These actions reflect our disciplined approach to investing in areas where we see the strongest long-term return and greatest strategic value.

Our Skywire portfolio continues to benefit from strong brand recognition and customer loyalty, Skywire is widely recognized for its reliability, pre-certification and ease of integration, enabling customers to accelerate deployment time lines and simplify deployment. These advantages make Skywire an increasingly attractive solution across a wide range of IoT applications, reinforcing our position as a strategic connectivity partner.

We are also making strong progress on our Cat 1 bis Embedded Modem roadmap within the Skywire portfolio. Cat 1 bis is an emerging cellular standard optimized for IoT applications, offering lower costs, lower power consumption and longer product life cycles while maintaining reliable LTE connectivity. Importantly, we are seeing growing validation of the Skywire platform through new customer engagements and design wins. Late last year, a large industrial infrastructure customer selected our Cat 1 bis Skyway modems as part of a major deployment initiative. This engagement highlights the growing customer problems for precertified fully integrated connectivity solutions that simplifies deployment, reduce engineering complexity and accelerate time to market.

We will also secure a design win with an emerging robotics customer, developing next-generation autonomous systems. They selected Skywire for its reliability, to certification and ability to support seamless nationwide connectivity across distributed robotic fleet. This win expands Skywire into the fast-growing robotics and automation market and demonstrates the platform's ability to support increasingly advanced and mission-critical applications. These design wins reinforce Skywire's strong competitive positioning and demonstrate its expanding role across industrial infrastructure, robotics and other emerging IoT segments. Taken together, these actions have strengthened the financial and strategic foundation of our IoT business. We expect modest growth in 2026 as customer inventory levels normalized and new design wins scale into production in the second half of the year.

Turning to our other core markets. Our aftermarket antenna business continues to be affected by excess channel inventory. Meanwhile this has created short-term variability, we have taken a disciplined approach to managing this business. focusing on profitability and operational efficiency.

Turning now to AirgainConnect and our broader vehicle gateway strategy. AirgainConnect represents a key pillar of our long-term platform strategy and reflects Airgain's evolution to our delivering integrated system-level connectivity solutions. Vehicle gateways have become an increasingly critical as enterprise utility, infrastructure and public safety operators rely on containers high-performance wireless connectivity to support mission-critical field operations.

Our AirgainConnect AC-Fleet platform is a fully integrated all-in-one vehicle gateway solution that combines high-performance antennas, embedded cellular modems and secure cloud-based management into a readied system purposely built for [ the mining ] mobile environment. This integrated architecture delivers superior performance, simplifies deployment and improved operational reliability for customers operating in harsh real world conditions. AC-Fleet is highly differentiated in the market due to its system-level integration. Rugged design and ability to support mission-critical applications, where connectivity performance, durability and reliability are essential. We continue to make strong progress expanding and advancing our AirgainConnect pipeline, reflecting increasing customer engagement and growing validation of our platform.

As of last week, our pipeline includes approximately 100 active opportunities, including 40 Tier 1 and Tier 2 opportunities, roughly double the number we had just a few months ago. These larger, more strategic opportunities now reflect expanding engagement with major enterprise utility, sanitation and infrastructure customers.

Just as importantly, these opportunities are progressing meaningfully toward commercialization, more than 1/4 of our Tier 1 and Tier 2 opportunities are in trial or negotiation basis. And we believe this demonstrates clear customer validation and the advancement toward potential deployment.

We are also seeing a significant shift in the competition of our pipeline. Many of our largest opportunities are now outside the traditional first responder market, reflecting strong momentum in enterprise fleet sanitation and utility applications. These markets represent larger deployment opportunities and shorter sales cycle. A clear example of this progress is our large utility customers engagement, which has advanced from an initial product evaluation to a broader enterprise level initiative. This expansion significantly increases the potential scope and long-term value of the opportunity reinforcing the strength of our platform and value proposition.

Overall, the growth, quality and advancement of our pipeline reflect increasing market adoption, positioning AirgainConnect to contribute more meaningfully as we move to 2026 and beyond. As part of our commitment to this vehicle gateway strategy, I'm excited to announce that we recently acquired the HPUE or High Power Use Equipment product line from Nextivity. This acquisition brings proven to deploy technology into Airgain's portfolio and expand our ability to support mission-critical connectivity applications. HPUE technology improves uplink performance, extend network reach and enables reliable connectivity in demanding operating environments. It is actively deployed today across commercial and public safety networks, including FirstNet, where performance and reliability are essential.

The additions of HPUE expense and strengthens our AirgainConnect platform, enhancing our ability to deliver more comprehensive, high-performance connectivity solutions for enterprise fleet, utility and public safety customers. Strategically, this acquisition expands our vehicle gateway portfolio, customer engagement and addressable market positioning us to capture long-term value as mission-critical connectivity requirements continue to evolve. Together, AC-Fleet and HPUE significantly strengthened our vehicle gateway competitive positioning as we capitalize on the growing demand for reliable system-level connectivity solutions across enterprise and infrastructure markets.

While AirgainConnect focuses on enabling reliable connectivity in mobile environment, our Lighthouse platform extends these capabilities into fixed infrastructure, enabling carriers, tower operators and enterprise customers to improve network coverage, capacity and performance.

Turning now to Lighthouse. Lighthouse represents our infrastructure platform focused on expanding and improving cellular coverage across both indoor and outdoor environments. As a reminder, Lighthouse is designed to help carriers, power operators and enterprise customers to extend network coverage, improve performance and optimize capacity in areas where traditional infrastructure deployment is difficult, costly going sufficient, as network operators continue to expand 4G and 5G coverage and address growing data demand. We believe Lighthouse represents a significant long-term opportunity for Airgain.

During the quarter, we successfully completed two important Lighthouse trials that demonstrate the real-world volume and technical differentiation of our platform. In a domestic trial with a Tier 1 U.S. mobile network operator, Lighthouse demonstrated the ability to significantly improve network performance through advanced carrier aggregation and capacity of loading capabilities. In this 1-day deployment, Lighthouse enabled seamless uploading of congested LTE traffic onto underutilized 5G spectrum, including overall network efficiency and performance. This capability is particularly important for operators as they manage growing network congestion while maximizing the value of the existing spectrum and infrastructure investments.

Internationally, we also completed a live trial with a major global tower operator and a large convention center in Latin America. This deployment demonstrated Lighthouse ability to support multiple carriers simultaneously and rapidly improve network performance in a high-density environment. These results validate Lighthouse ability to address complex real-world coverage challenges and reinforce its applicability across a wide range of infrastructure deployment scenarios. These successful trials represent important milestones and further validate the strength and differentiation of our technology.

In parallel, we established our first system integrator partnership in the U.S., and are actively engaging with additional system integrators to expand our routes to market. System integrators play a critical role in deploying and scaling infrastructure solutions, and the engagement represents an important step in accelerating Lighthouse adoption in commercialization.

We are also finalizing a strategic partnership with a leading global provider of intelligent cellular coverage solutions to codevelop next-generation integrated 4G and 5G coverage platforms. This partnership combines Lighthouse with complementary cellular coverage technologies to deliver more comprehensive and scalable solutions for operators, enterprises and infrastructure customers. Importantly, it expands Lighthouse applicability across a broader range of deployment scenarios, including complex indoor and outdoor environments.

This collaboration represents a significant strategic milestone for Lighthouse. It validates the strength of our platform, enhances our ecosystem positioning and accelerates our ability to bring integrated infrastructure solutions to market.

We look forward to sharing more details at Mobile World Congress next week and believe this partnership represents an important catalyst, while advancing Lighthouse commercialization and long-term growth. Taken together, the progress we are making across trials, customers engagement and partner development and reinforces our confidence in Lighthouse long-term opportunity and positions the platform to begin contributing more meaningfully as deployments still over time.

With that, I'll turn the call over to Michael to review our financial results. Michael?

Thank you, Jacob. Before diving into the numbers, please note that my review of our financial results and guidance refers to non-GAAP figures. Information about the non-GAAP financial measures, including GAAP to non-GAAP reconciliations can be found in our earnings release.

Now let's turn to our fourth quarter results. Q4 sales came in at $12.1 million, which was at the low end of our guidance range, primarily reflecting timing and supply factors within our Enterprise embedded modems product line. These dynamics were timing related and did not reflect a change in underlying customer demand. Consumer sales reached $7.3 million, reflecting another strong sequential performance, driven by increased Wi-Fi 7 antenna shipments to cable operators. $7.3 million, represents the highest quarterly consumer revenue since Q3 of 2022, reflecting the successful transition of MSO customers to next-generation Wi-Fi 7 platforms and reinforcing the strength and durability of our Consumer business.

Enterprise sales came in at $4.3 million, down $2.6 million sequentially, driven by lower embedded modems and enterprise antenna sales. Automotive sales came in at $0.5 billion, flat sequentially. Non-GAAP gross margin for the fourth quarter was 46.3%, 230 basis points higher than the midpoint of our guidance, and a 190 basis point sequential increase. The sequential gross margin improvement was driven by a favorable product mix in the consumer market, along with operational efficiencies.

Non-GAAP operating expenses for the fourth quarter totaled $5.9 million, in line with our guidance and slightly lower sequentially. In Q4, adjusted EBITDA was negative $0.2 million compared to $0.1 million midpoint of guidance. Non-GAAP EPS was negative $0.03. As of December 31, 2025, our cash balance was $7.4 million, up $0.3 million sequentially, primarily due to cash proceeds of $0.4 million from our ATM.

Turning to our results for the full year of 2025. Sales totaled $51.8 million, down $8.8 million or 15% compared to the prior year. Consumer sales were $26.1 million for the full year, up 20%, driven by increased shipments to both cable and mobile network operators. Following typical seasonal softness in the first quarter, we expect the Consumer business to grow modestly, supported by ongoing MSO demand and the expected ramp of recently secured Tier 1 MNO design wins in the second half of 2026.

Enterprise sales were $22.6 million, down $6.9 million or 23% year-over-year, primarily due to excess inventory at a strategic IoT customer and more enterprise antenna demand. We expect the enterprise market to grow in 2026, driven by modest growth in our IoT business and revenue contributions from our Lighthouse platform in the second half of the year. Automotive sales were $3.1 million, down $6.3 million year-over-year reflecting lower demand and excess channel inventory in the aftermarket antenna business. We expect the automotive market to return to growth in 2026, driven by increasing revenue contributions from our AirgainConnect platform.

Non-GAAP gross margin was 44.6%, up [ 266 basis points ] year-over-year, driven by Consumer and Enterprise margin increases. These improvements reflect the favorable product mix within these markets the ramp of differentiated higher-margin products and the impact of cost reduction and operational efficiency initiatives implemented over the past year. Looking ahead, we expect higher value platform solutions, such as AirgainConnect and Lighthouse to further support gross margin expansion in 2026 and beyond.

Non-GAAP operating expenses totaled $25.1 million, reflecting a 6% decrease year-over-year. Despite the decline in expenses, we increased engineering, sales and marketing expenses for our AirgainConnect and Lighthouse platforms by approximately 15%, while reducing comparable expenses in our core markets by approximately 30%. These actions significantly improved the contribution margins of our core markets and demonstrated the structural efficiency gains that we have made across the business.

In 2025, we took disciplined steps to optimize our cost structure and build a more efficient and scalable organization. As a result, Airgain is now better positioned to drive stronger profitability and operating leverage as revenue grows.

For the full year 2025, adjusted EBITDA was negative $1.5 million, compared to negative $0.8 million in 2024, reflecting continued investment in our platform strategy. Non-GAAP net loss per share was $0.17.

Now moving to our outlook for the first quarter ending March 31, 2026. As a reminder, we provide quarterly guidance for sales, non-GAAP gross margin and expenses, non-GAAP EPS and adjusted EBITDA as we believe these metrics to be key indicators of the overall performance of our business.

For the first quarter of 2026, we project sales to range from $10.5 million to $12.5 million, with a midpoint of $11.5 million. The midpoint represents a 5% sequential decline driven by the consumer seasonal impact. We expect non-GAAP gross margin for the first quarter to be in the range of 43.5% to 46.5%, or 45% at the midpoint. We expect operating expenses to remain flat at approximately $6 million. Non-GAAP EPS is expected to be negative $0.07 at the midpoint of our guidance. Adjusted EBITDA is expected to be negative $0.7 million at the midpoint of our guidance.

Overall, the actions that we have taken over the past year have strengthened Airgain's operating model and position the company for improved financial performance as we move through 2026. We expanded gross margins, improved the efficiency and contribution margins of our core markets and establish a more scalable cost structure, the strength and profitability of our core markets, specifically consumer and IoT provide the financial foundation to support continued investment in our growth platforms. As the AirgainConnect and Lighthouse progress toward commercialization, we believe Airgain is well positioned to drive revenue growth, margin expansion and increased operating leverage.

Now I would like to turn the call back over to Jacob for his closing thoughts. Jacob?

Thanks, Michael. As we look ahead, Airgain is operating from a position of strength, supported by the stronger foundation, expanding platform capabilities and growing strategic momentum. We have entered the next stage of our evolution, focused on commercial execution, scaling our platforms and converting our expanding pipeline into meaningful revenue growth. While near-term timing dynamics in the natural growing pains of scaling a platform business remain. The progress we are making is clear. Customer engagement is accelerating our pipeline continues to expand, and we are advancing key initiatives that position us to scale and accelerate commercialization.

We are strengthening our go-to-market capabilities with the addition of Frank Jules as Strategic Adviser. Frank previously served as President of AT&T Global Business Solutions, where he led a $44 billion organization, serving enterprise and carrier customers worldwide. His deep industry relationship and strategic insights are already helping accelerate customer engagement and open doors with key enterprise and carrier customers. His involvement enhances our ability to scale our go-to-market efforts, expand our reach with strategic customers and more efficiently convert pipeline opportunities into commercial deployments.

We are also strengthening our platform towards strategic and capital-efficient initiatives, including the acquisition of the HPUE product line from Nextivity, which enhances our leadership in mission-critical connectivity. In addition, the strategic co-development partnership, we mentioned will further enhance Lighthouse capabilities and accelerate its path toward commercialization.

At the same time, our core markets continue to provide a stable and cash-generating foundation that supports ongoing investment in our growth platforms. Importantly, the work we have done over the past few years has fundamentally reposition Airgain, we have strengthened our operating model, improve margins, expanding our addressable market and build differentiated platform capabilities aligned with a large and growing connectivity opportunities. We are encouraged by the continued expansion of our pipeline, the strengthening of our go-to-market capabilities and recent multiyear design wins with Tier 1 service providers, which reinforced the durability and strategic importance of our core business.

Our priorities are clear: execute with discipline; convert pipeline opportunities into deployments; accelerate commercialization; and scale our platforms to drive sustainable growth. We are confident in our strategy, encouraged by our progress and believe Airgain is well positioned to deliver meaningful long-term growth.

Operator, we are now ready to take questions.

[Operator Instructions] Our first question today is coming from Jaeson Schmidt from Lake Street Capital.

Just curious if you could update us on what we should be looking for, for the next steps for these Lighthouse trials? Obviously, they were completed this past quarter. How should we think about these opportunities finally impacting the P&L?

Yes. Jaeson, great to have you joining us. Yes, great questions, by the way. So for the trial that we mentioned for the U.S. market, the trial was very successful. So now we're engaging with their business side, the product side, on a couple of things. One is to creating a business plan business support case. Additionally, we are also working on the networking capability. As far as the international opportunity that we mentioned in Latin America, also been very successful. And as a result of that, we're actually going to have a follow-up meeting next week doing MWC with the executive members to discuss the next step.

And Jason, in terms of timing, your question there, those are -- we're not counting on those for any FY '26 revenues. But this would be for '27. What we are accounting on in FY '26 are really the system integrators that we have in the U.S., we have one partner so far. We are actively working on signing a couple of them as well to over the next few months. And this will definitely allow us to have more of a deployment of some of the critical needs that exist in the U.S.

In the Middle East, we're also making progress there as well, too, with our partner, Omantel, but also with other Middle Eastern partners, but we foresee that to be a meaningful contribution from a revenue standpoint certainly in the second half of 2026.

Okay. That's really helpful. And then looking at the Nextivity product line announcement, just curious if there is a built-in customer base here? Or how we should be thinking about the potential demand pull for these products?

Very good question, Jason. I'll start and then Jacob can weigh on that as well too. So first of all, we are very excited about this acquisition. This is a small acquisition, but it is highly strategic to our vehicle gateway platform.

Just a couple of items there is that it is a noncash, non-equity type of acquisition. We essentially are acquiring the HPUE intellectual property along with the customer base. And we're basically going to be running the MegaFi 2 product line, supporting the current FirstNet customers, with the goal of expanding the current revenue run rate by the end of the year. I'm mentioning this because as part of the acquisition, we also have entered into a reseller agreement with Nextivity. Nextivity has been working on some international customers who are interested with the HPUE solution. And therefore, once those design are on and the project revenue start to ramp up. Secondly, by the end of this year, we'll be able to support Nextivity on the -- with this reseller agreement.

To give you a sense about the revenue run rate, last year's revenue, we are close to $2 million or about $0.5 million of run rate on a quarterly basis with a potential uptick by the end of 2026 and '27 at those international customers ramp up. And most importantly is that this acquisition here is going to be adjusted EBITDA on day 1. Jacob?

No, yes, I think that's -- Michael, you said it well. I think they're really going to enhance us both domestically with the FirstNet partnership. And that's one of the main reasons that we also really attracted because, as you know, we value the FirstNet smaller market with our AC-Fleet. So there's a lot of synergy between the AC-Fleet and HPUE. It really fits another piece of the puzzle as far as the overall AirgainConnect platform is concerned. So we're really excited about this particular acquisition and we look forward to work with our partners, FirstNet partners and also our SIs to really expand this product line domestically and internationally.

[Operator Instructions] Our next question is coming from Anthony Stoss from Craig-Hallum Capital Group.

Jacob, Michael, you've always had a strong pipeline on the AirgainConnect lots of trials. What can you do to convert those into sales faster? And I'm just curious why haven't a lot of these converted much sooner? And then I have a follow-up after that.

Yes. Thank you, Tony, for the questions. So let me start as well too. So first off, we're making some really good progress on the pipeline. As you pointed out, it is actually growing. We have currently about 100 active opportunities. Last November update, we provided 80 of overall opportunities, but unlike last November, we currently have about 40 of Tier 1 and Tier 2 opportunities today compared to 20 last November. So what changed here is that we are becoming much more successful with the non-first responder market. Those tend to be a lot faster, and those represent the utility, the sanitation and the fleet enterprise or the enterprise fleet, I should say, customers. And those are coming online from a pipeline standpoint and they're also very eager to even start trials faster than first responder.

First responders tend to have quite a bit of budget constraints or government funding, whereas some of those private and public companies have a much more centralized commercial decision-making process. So if we go back to the cycle time that we have mentioned before, with Tier 1 being 12 to 18 months of a cycle time and the Tier 2 being 6 to 12 months of a cycle time. If we go back to -- and I'll start with the AT&T certification as the clock starts, we are right on the cut of closing down some of the Tier 2 customers, and we expect to have a couple of those by the end of this quarter. and start ramping up in Q2, certainly. And the Tier 1 would be definitely slated in Q4.

Now things may change, of course. But right now, we feel we are progressing. We, of course, want to be doing faster, but we'll also add handful with a lot of trials going on right now. Jacob?

No, I was going to add that. We're actually in negotiation that stage with a number of these opportunities. So we're getting closer and closer to be able to get some of the bigger deals as soon. We're getting the smaller deals. But the bigger deals are the one that takes longer time, but we are -- in our mind, we are right on track at this point.

Got it. And then two-part question probably for Michael. You commented that you expect gross margins to be up year-over-year. Do you need a whole bunch of these AirgainConnect people to convert to hit that bogey? And then also OpEx, do you expect to be roughly flat from where it was December and the March guide for the remainder of the year?

Yes. So on the gross margin, right now, where we are right now is a good place to be. And the fact of the matter is that Lighthouse and AirgainConnect are certainly higher margins than our corporate average, mainly because they are premium value type of solutions. And so depending upon the revenue that we estimate that will have a change on the overall gross margin. But as it come online, especially in the second half of 2026, we expect to see a benefit on our gross margin.

From an OpEx standpoint, as I mentioned, in 2025 was quite a bit of a transformation year because we certainly optimize the overall cost structure of our core markets or existing business lines, and we were able to really make those quite profitable, specifically our consumer business and our IoT business as well too. And likewise, directing and reallocating some of those resources towards the growth platform. And so we expect that trend to continue. However, from an expense standpoint and vis-a-vis the overall EBITDA goal that we have, we expect to be remaining flat in are likely to be flattish also in Q2. And then as the revenue ramps in the second half of the year, hopefully, we'll be able to increase our overall OpEx as well during the second half of the year.

At this time, that concludes our question-and-answer session. If your question was not answered, you may contact Airgain's Investor Relations team at [email protected]. I'd now like to turn the call over to Mr. Suen for closing remarks.

Thank you all for your thoughtful questions and for your continued interest in Airgain. If there's one key takeaway it is that Airgain is a more focused and disciplined company entering 2026 with a stronger foundation and improving operating model in a position for sustainable growth and increasing platform adoption. We believe the strategic foundation we have built positions again to deliver meaningful and sustainable long-term growth. Michael and I will be attending the 38th Annual RAS conference in Dana Point next month, and we look forward to connecting with many of you there and continuing the conversation. Operator, you may now conclude the call.

Thank you for joining us today for Airgain's Fourth Quarter and Full Year 2025 Earnings Call. You may now disconnect.

Good afternoon, and welcome to Airgain's Third Quarter 2025 Conference Call. My name is Paul, and I will be your operator for today's call.

Joining us today are Airgain's President and CEO, Jacob Suen; and CFO, Michael Elbaz. As a reminder, this call will be recorded and made available for replay via a link found in the Investor Relations section of Airgain's website at investors.airgain.com.

Following management's prepared remarks, the call will be open for questions from Airgain's covering analysts. I caution listeners that during this call, Airgain management will be making forward-looking statements about future events as well as Airgain's business strategy and future financial and operating performance. Actual results could differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with the company's business. These forward-looking statements are qualified by the cautionary statements contained in today's earnings release and Airgain's SEC filings.

This conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, November 12, 2025, Airgain undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call.

In addition, this conference call will include a discussion of non-GAAP financial measures. Please see today's GAAP earnings release for further details, including a reconciliation of GAAP to non-GAAP results.

Now I'd like to turn the call over to Airgain's CEO, Jacob Suen. Jacob?

Good afternoon, everyone, and thank you for joining us. Throughout 2025 we have remained deliberate about how we build Airgain, focusing on what we can control, refining where we compete in executing step-by-step to create a stronger, more scalable company. Our focus continues to show in our results.

In Q3, we delivered our third consecutive quarter of sequential revenue growth. met guidance achieved strong gross margins and generated positive adjusted EBITDA. We also reached key certification milestones that move our growth platforms closer to scale.

Before diving deeper, I want to step back and frame where we are in our growth journey. With the year nearly complete, this is a good time to reflect on the progress we have made and how it projects Airgain for sustainable growth in 2026. Airgain was founded on a simple idea. We simplify wireless. From day 1, our mission has been to help our customers' devices vehicles and networks connect more reliably by removing complexity from wireless design. Our technology reaches across 3 core markets. Consumer, enterprise and automotive, connecting leading carriers, service providers and OEMs that depend on reliable dryness performance.

Our business rests on 2 pillars. First, our core markets provide stability in a solid foundation to fund growth. Second, our growth platforms, AirgainConnect and Lighthouse that open new scalable opportunities in fleet and network coverage solutions.

Let me start with our core business, which remains healthy and profitable on a stand-alone basis. In Consumer, we expect revenues grow in a double-digit rate for the second consecutive year, driven by the WiFi 7 transition among Tier 1 cable operators and growth of FWA antenna sales to a Tier 1 mobile network operator. Looking ahead to 2026, we expect continued growth supported by the WiFi 7 transition and new design wins, such as the one we announced this week with another Tier 1 U.S. carrier for its next gen WiFi 7 fiber broadband gateway. The new platform is targeted for commercial launch in the second half of 2026, with projected shipments exceeding 5 million units within the next 5 years.

In embedded modems, we also expect double-digit revenue growth for the second consecutive year, fueled by rising demand in utility infrastructure monitoring, including energy management, in electrical grid applications. We launched our Skywire Tier 1-based embedded modem and recognized initial revenue in Q3. And we expect this solution to be a growth driver in 2026.

Embedded modem sales now represent more than half of our enterprise market revenue, and we continue to invest in next-generation development to extend our leadership position. While our consumer and embedded modem businesses generated higher revenue and contribution margins this year. Other product lines faced challenges that we are actively addressing.

Asset trucker sales have moderated reflecting a lack of traction on customer projects. Aftermarket antenna and enterprise custom products remain way down by channel inventory overhang, partly driven by government agency project deployment delays. Given the current government funding climate, we expect this overhead to persist through the first half of 2026.

Additionally, we are leveraging our high-performance antenna portfolio to expand into emerging markets and applications, including unmanned flight systems, smart infrastructure and industrial IoT which are expected to create new revenue streams for Air game in 2026 and beyond.

Taken together, our core markets are performing largely as expected, providing steady revenue and EBITDA. We expect core markets to be up modestly in 2026 and to remain self-sustaining, generating the cash flow that supports continued investment in our platform strategy.

With the foundation in place, let's transition to our growth platforms, AirgainConnect and Lighthouse where we are seeing tangible progress in expanding engagement. AirgainConnect is our integrated 5G gateway platform for enterprise applications, such as fleet, utilities and mobile usage.

Following the AT&T FirstNet truck complication earlier this year, we achieved another significant milestone by obtaining T-Mobile key priority certification last month, validating AirgainConnect for mission-critical connectivity and opening access to T-Mobile's public city and enterprise networks.

As we have said on prior calls , the AirgainConnect sales cycle varies by fleet sizes, which impacts the timing of revenue recognition. Tier 3 customers under 50 vehicles moved the fastest with a sales cycle of roughly 3 months, providing near-term revenue potential.

Tier 2 customers, 50 to 500 vehicles, generally takes 6 to 12 months from the engagement to deployment. Tier 1 customers, over 500 vehicles of the longest cycle, 12 to 18 months and often do structure RFPs in pilot validation programs. Our sales of growth is consolidated in multiplan, spanning partnerships with carriers strategic value-added resellers and distributors to direct engagements with key customers as a trusted solution provider.

We have a dedicated sales, marketing and customer support team, which continues to evolve to better express customer needs. Our sales opportunity pipeline continues to expand with roughly 80 opportunities in play. 2/3 of which in 3 trial phases. We currently have approximately 60 Tier 3 opportunities, averaging 10 units each with nearly half already in the post trial phase.

Our Tier 1 and Tier 2 opportunities vary in size, with most still in the early engagement of pretrial stage. About 2/3 are focused on the first responder market where adoption has been slowed by budget and funding constraints that will further accentuate it by the recent government shutdown.

While the AirgainConnect value proposition in the first responder market, centers around its all-in-one design and integrated eSIM capability we are finding strong traction in utility and energy infrastructure markets. For these customers, the conversation shifts from replacing their current cellular setup to enabling true edge connectivity, a new level of integrated high-performance connectivity that supports advanced in vehicle sensing, multi-camera, video recording and image recognition capabilities and external environmental sensors with continuous cloud connectivity. AirgainConnect is more than a hardware upgrade. It simplifies network management, includes coverage and performance and meaningfully reduces OpEx by allowing fleets to consolidate multiple same-base connections into a single intelligent gateway.

A good example is our engagement with a large fleet operator pursuing a digital transformation to improve operational efficiency and reduce annual operating expenses. Today, each truck relies on multiple SIMs to power cameras and sensors. AC fleet is being evaluated as a single gateway solution with multiple caller eSIM capability, simplifying connectivity management and enabling remote carrier switching. Looking ahead, we are on track for Tier 2 opportunities to begin converting into design wins in the first half of 2026.

With Tier 1 programs expected to follow in the second half of the year. These milestones reflect steady progress to customer validation. And demonstrate strong alignment with our strategic engagement roadmap. Compared to Lighthouse, AirgainConnect is the more immediate growth driver and we enter 2026 with strong visibility and confidence in the platform's adoption trajectory. As AirgainConnect establishes our leadership in fleet connectivity. Lighthouse marks our expansion into network infrastructure optimization, helping carriers in enterprises expand 5G coverage and of low extra capacity more efficiently. We achieved FCC certification last month, a significant milestone that now enables Lighthouse to be deployed commercially in the U.S.

Lighthouse, our 5G network control repeater provides a faster, lower cost and more sustainable alternative to traditional base station infrastructure and positive distributed antenna systems, equipped with an optional solar package. It can operate autonomously in off-grade or rural locations, addressing both performance and sustainability objectives. We continue to make meaningful progress across our target regions.

In the U.S., we have secured a Tier 1 carrier trial that is expected to be completed by the end of this year. This trial represents amounts of technical collaboration in senior executive sponsorship underscoring its significance as a company milestone. As part of this engagement, we will deploy our first dual carrier installations, validating Lighthouse capability to aggregate multiple spectrum channels simultaneously, delivering higher throughput improve signal stability in a superior end-user experience.

This channel aggregation capability is unique to Lighthouse and represents a clear competitive differentiator in the 5G coverage extension market. While we are excited about this U.S. trial, we remain cautiously optimistic given the land carrier engagement cycle. We are also finalizing a system integrator agreement with a leading U.S. system integrator, covering thousands of sites transitioning from 4G LTE to 5G. The integrator plans to use Lighthouse to upgrade these locations and support future deployments. This is a strategic relationship designed to enable and scale customer deployments while also supporting the integrators enterprise clients.

In the Middle East, installations are progressing with Omantel through the initial phase, and we are planning for a joint sales and marketing rollout in 2026. In parallel, we are engaged in additional regional discussions and an expanding lighthouse adoption across neighboring markets. In South America, we are currently executing a trial with a top 5 global power provider in collaboration with 2 regional Tier 1 mobile network operators. This trial marks the industry's first dual operator deployment. We -- support 2 independent carriers to a single installation. This capability eliminates redundant hardware, reduces deployment costs and accelerate network expansion, while the opportunity could be significant, we remain cautiously optimistic regarding the financial impact, which is expected to materialize over the next 12 to 18 months.

Looking ahead, our focus is on completing active deployments, scaling commercial pilots and expanding system integrator partnerships globally. We expect modest lighthouse revenue contribution in the first half of next year, followed by stronger growth in the second half as U.S. system integrator engagements expand in international projects events. Our strategy is working. Momentum is building and execution remains our priority. As we conclude 2025, our focus remains clear: to complete our transition from a component supplier to a scalable wireless systems solutions company, while maintaining financial discipline, executing on our engineering road map on being customer pallets. By the resources needed to execute our strategy effectively.

With that, I'll hand it over to Michael to discuss our financial results. Michael?

Thank you, Jacob. Before I dive into the numbers, I will note that my remarks refer to non-GAAP figures, unless otherwise indicated. Reconciliations to GAAP results can be found in today's earnings release. Third quarter revenue came in at $140 million at the midpoint of our guidance and up 3% sequentially from the second quarter. Breaking this down by market. Consumer revenue was $6.7 million, up $1 million sequentially driven by higher WiFi 7 antenna shipments to cable operator. On a year-to-date basis, our sales to cable operators grew by over 50% and fueled by the WiFi 7 technology refresh. Enterprise revenue was $6.9 million, down $0.3 million sequentially due to lower enterprise antenna sales.

Our embedded modems product line recorded third consecutive quarter of sequential sales growth. The growth was driven by end customers in the utility infrastructure monitoring market. Automotive revenue was $0.5 million, down $0.3 million sequentially driven by lower aftermarket antenna sales. Third quarter non-GAAP gross margin was 44.4%, up from 43.8% in Q2.

On a year-over-year basis, gross margin increased by 160 basis points, driven by improved enterprise and consumer product margins. Third quarter non-GAAP operating expenses were $6.1 million, lower both sequentially and year-over-year and reflecting an expense realignment within our core product lines and a decrease in our G&A expenses. While total expenses have decreased, we continue to invest in our growth platforms specifically the sales, marketing and engineering functions to support a scalable system solution company.

On a year-to-date basis, our non-GAAP engineering sales and marketing expenses decreased 10% year-over-year. Within that, we estimate the engineering sales and marketing expenses for our 4 product lines decreased by approximately 30%, while investment in our growth platforms increased by about 30%.

Adjusted EBITDA improved to a gain of $0.3 million compared to a loss of $0.4 million in Q2. Q3 non-GAAP net income was $0.1 million or $0.01 per share compared to a loss of $0.5 million or $0.04 per share in Q2. We ended the quarter with $7.1 million in cash and equivalents, down $0.6 million sequentially and down $0.3 million on a year-over-year basis.

Year-to-date, we received $2.1 million in net proceeds from the employee retention credits we applied for over 2 years ago. The ERC credits helped offset the impact of $1.7 million year-to-date non-GAAP operating loss on our cash balance.

Looking ahead to the fourth quarter, we expect revenue in the range of $12 million to $14 million, with a midpoint of $13 million representing a sequential decline of approximately 7%. This decline reflects a temporary moderation in our consumer and enterprise sales following strong year-to-date performance. We expect non-GAAP gross margin for the fourth quarter to be in the range of 42.5% to 45.5% or 44% the midpoint. We do not anticipate a material impact from tariffs or the recent government shutdown, although this environment may result in supply chain disruption costs. We expect non-GAAP operating expenses for the fourth quarter of approximately $5.8 billion, resulting in positive adjusted EBITDA of approximately $0.1 million at the midpoint of our guidance range.

Now I will turn the call back over to Jacob for his closing remarks. Jacob?

Thanks, Michael. To put it simply, 2025 has been a year of validation and disciplined execution, and we are entering 2026 with stronger visibility. A clear road map and the foundation to scale. We have achieved key certifications and deepen customer engagement across our growth platforms. Our core business provides stability, our platforms create drivers for growth, and our team continues to execute with focus in accountability. The opportunity ahead of us is clear and our conviction has never been higher. Thank you to our employees, partners and investors for your continued trucks and support.

Operator, we are now ready to take questions.

[Operator Instructions]. Our first question is from Anthony Stoss with Craig-Hallum Capital.

It's Bryan on for Tony. I'm just curious on your recent WiFi 7 design win with the Tier 1 carrier. Is this an existing customer upgrade for you guys? Or is it a completely new customer? And then how do you think of the cadence of the ramp and the revenue impact for next year?

Brian, yes, this is Jacob here. the customers, it's in existing customers. Although this is -- as far as the end customers is a U.S. Tier 1 operator. And this is the flagship gateway for the next generation. So this is the largest SKU.

Okay. Got it. And then how do you guys think of the -- I know it's going to ramp the second half of next year, how do you think of the revenue impact for 2026?

Look, we talk about the size. It's -- we talk about it in excess of 5 million units. It's going to be within 5 years because that's usually how operators roll out their deployment as far as 2026, we would be able to get more visibility, I would say, in the first half of the year because it's planned to be start deploying in the beginning of second half of next year.

Okay. Got it. And then maybe one for Mike on OpEx. It's nice to see continued cost discipline, both in the results and the guide for December. I'm curious how you think about OpEx fluctuation next year as you ramp some of the new products?

So our goal is really to be at EBITDA breakeven, if not positive. And so as we have some runway left to have the revenue ramp in the AC fleet and Lighthouse, we will maintain that tight management of OpEx. We're always looking for efficiencies in our G&A expenses. This has always been the case. And at the same time, we're also looking very deliberately on our investment in our core markets, mainly because we want to make sure that we continue to invest on the growth platform, just like we have done over the past few years. So it would be basically a tight management of OpEx. It will be deliberate top-up investment. It would be focused on the growth platforms.

On the core markets, as we mentioned, the consumer product line, along with the embedded product line, which is part of the enterprise market, definitely have been bright spots for us in FY '25. And so we have as well an engineering road map along with increased focus on the sales and marketing effort as we continue to win designs on those 2 major product lines.

All right. Got it. Thank you, Jacob. Thank you, Michael.

Thank you. Thank you. This concludes our question session. If your question was not answered, you may contact Airgain's Investor Relations team at [email protected]. I'd now like to turn the call back over to Mr. Suen for any closing comments.

Thank you for your thoughtful questions and for your continued interest in Airgain. If there's one takeaway, it's that Airgain, it's a more focused, disciplined company entering 2026 position for sustainable growth and increasing platform adoption. Michael and I will be attending the Craig-Hallum conference in New York City on Tuesday, November 18, and we look forward to connecting with many of you there. Operator, you may now conclude the call.

Thank you for joining us today for Airgain's Third Quarter 2025 Earnings Call. You may now disconnect.

Good afternoon. Welcome to Airgain's Second Quarter 2025 Conference Call. My name is Ina, and I will be your operator for today's call. Joining us today are Airgain's President and CEO, Jacob Suen; and CFO, Michael Elbaz. As a reminder, this call will be recorded and made available for replay via a link found in Investor Relations section of Airgain's website at investors.airgain.com.

Following management's prepared remarks, the call will be open for questions from Airgain's covering analysts. I caution listeners that during this call, Airgain management will be making forward-looking statements about future events as well as Airgain's business strategy and future financial and operating performance.

Actual results could differ materially from those stated or implied by these forward-looking statements, future risks and uncertainties associated with the company's business. These forward-looking statements are qualified by the cautionary statements contained in today's earnings release and Airgain's SEC filings.

This conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, August 6, 2025. Airgain undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call. In addition, this conference call will include a discussion of non-GAAP financial measures. Please see today's earnings release for further details, including a reconciliation of GAAP to non-GAAP results.

Now I'd like to turn the call over to Airgain's CEO, Jacob Suen. Thank you. Please go ahead.

Thank you, operator, and hello, everyone. Airgain entered 2025 with a clear strategy to scale our growth platforms, strengthen our existing markets and maintain disciplined operational and financial execution. In the second quarter, we put that strategy into action, delivering sequential revenue growth, reducing operating expenses and achieving key milestones that set the stage for second half profitability and growth inflection in 2026. .

Today, I plan to cover 3 key topics. First, our second quarter business performance, including trends in our consumer, enterprise and automotive markets. Second, progress on our growth platforms, AirgainConnect and Lighthouse with an update on milestones, customers' traction and the timing of certifications and deployments and finally, our strategic outlook, including our path to profitability and the 2026 growth inflection of our platforms scale.

Let me start with our operating environment in existing businesses. which forms the foundation of our strategy. The tariff environment remains fluid, but we have not experienced a material impact on our gross margin for end customer demand. Our public model supported by 7 global contract manufacturing partners gives us flexibility to navigate this challenging environment while maintaining a lean cost structure, an important advantage as we focus on profitability.

Our existing markets remain stable and relatively predictable. In our consumer market, Wi-Fi 7 shipments to Tier 1 MSOs including a leading U.S. cable provider that launched its Wi-Fi 7 offering in April, continued to ramp in the quarter. Demand is normalizing at healthy levels, well above the 2023 trial, providing a stable revenue foundation. At the same time, we are investing in the growth areas within this market to expand our customer base and capitalize on the long-term connected device trends.

In our enterprise market, Airgain NimbeLink embedded modem line was a strong performer in Q2 and is well positioned to maintain its momentum in the second half of the year. Adoption has been highest among industrial IoT system integrators who need a turnkey cellular solution that simplifies certification, reduces engineering effort and shortens time to market. We have seen the greatest success in utility infrastructure monitoring, including energy management, oil and gas and electrical grid applications.

Additionally, in June, we launched our Skywire Cat 1-based embedded modem, please certify for an application use and designed to streamline IoT deployments by reducing certification hurdles in accelerating IoT deployment time lines. This innovation broadens our reach in industrial IoT markets. Conditions remain soft in our automotive aftermarket and asset tracking markets. Aftermarket antenna sales growth continues to be way down by channel inventory overhang, which we expect to persist through the second half of the year.

Asset tracking sales have also moderated this year, reflecting a lack of traction on key projects. Our revenue in this area is now comprised of orders from existing customers along with stable recurring revenue. Together, these existing markets provide a steady revenue foundation enabling us to drive our growth platform initiatives.

Now let's turn to AirgainConnect, our mission-critical mobile connectivity platform. AirgainConnect, AC-Fleet combines an integrated 5G modem Wi-Fi 6 router and high-performance antenna to deliver reliable broadband for utility and public safety fleets. AC-Fleet is progressing to key carrier certifications, which are essential for unlocking larger Tier 1 in government opportunities. We continue to make important progress on this platform.

In May, we achieved FirstNet Trusted truck certification for AC-Fleet, a critical milestone by opens access to FirstNet's dedicated public safety network, accelerates procurement with government and municipal agencies and serves as a key gating factor for large-scale utility and first responder deployments. In short, this most AC-Fleet from pilot programs to being fully deployable in mission-critical environments.

In June, we introduced the AirgainConnect Go-Kit Pro, a rugged TCA compliant 5G mobile connectivity kit with a built-in battery Wi-Fi 6 GPS and multi-carrier easing. It is purpose built for first responders and remote teams, enabling secure broadband deployment in seconds and complements AC-Fleet by extending connectivity beyond the vehicle to field and temporary operations. Also in June, we secured a new Tier 2 utility deployment with a Midwestern electric utility, marking another AC-Fleet win in demonstrating the value of our AC-Fleet solution to the utility market.

This market values AC-Fleet for its ability to provide real-time connectivity to close in the field, improve situational awareness during outages and emergency response and reduce the cost and complexity of network installations across widely distributed fleets while multiple Tier 3 customers have deployed AC-Fleet. This is the first Tier 2 customer deploying AC-Fleet today as part of its fleet modernization initiative.

As I have shared on prior calls, the AC-Fleet sales cycle varies by fleet size and directly impacts the timing of revenue recognition. Tier 3 customers under 50 vehicles typically move the fastest with a sales cycle of roughly 3 months, providing near-term revenue opportunities. Tier 2 customers 50 to 500 vehicles, generally takes 6 to 12 months from engagement to deployment. Tier 1 customers, over 500 vehicles have the longest cycle, 12 to 18 months and often require a formal RFP process.

We currently have roughly [ 40 ] sales opportunities in our pipeline with a primary focus on the first responder in utility markets. Net of our design wins in Q2, our sales opportunities pipeline grew approximately 20% in the second quarter. Our strategy is to maintain a broad, well-balanced pipeline that positions the platform for meaningful scaling in 2026.

We remain on track for T-mobile priority 1 certification in Q3. For the Horizon frontline certification in Q4 2025. In European certification in Q1 2026, all of which expand our addressable market, open access to Tier 1 and government contracts and enable larger multi-fleet deployments. Customers are selecting AC-Fleet because it is a true all-in-one solution with integrated eSIM technology, simplifying installation, enabling seamless carrier switching without power changes and lowering total cost of ownership for utilities, law enforcement and emergency response agencies. This eSIM capability is a key differentiator, giving fleet the flexibility to select the best available network and maintain connectivity in mission-critical scenarios.

We are also investing in AC-Fleet's go-to-market strategy, strengthening our marketing efforts in participating in industry events such as the FirstNet from T-Mobile fleet in Verizon line. Our multipronged sales strategy of expanding our dedicated fleet force sales team from coast to coast, identifying [indiscernible] in working closely with our distribution partners are designed to accelerate trial conversions and drive platform adoption into 2026.

Turning to Lighthouse. Our 5G smart network repeater platform serving both U.S. and international markets. Lighthouse delivers a unique connectivity solution for expanding 5G connectivity and uploading capacity when networks are underutilized. Lighthouse stands out by significantly reducing the total cost of ownership compared to traditional micro and macro cells with the capability to be deployed in our [indiscernible] months.

Lighthouse offers a cost-effective, low complexity and environmentally sustainable solution, especially with its solar-enhanced package. Our go-to-market strategy is dual prong. Internationally, we collaborate closely with mobile network operators like Omantel, where sales cycles typically extend 12 to 18 months from design to deployment. In the U.S. we are initially targeting system integrators that serve enterprises where the sales cycle can be significantly shorter. This approach allows us to generate revenue sooner while establishing long-term relationships with MNOs for larger network-wide deployments.

We are actively investing in the U.S. market. including the hiring of a dedicated business development leader to expand our system integrator network. By working with system integrators, we aim to address both outdoor and indoor connectivity pinpoints, accelerate deployments and create a more predictable domestic revenue stream. We are scheduled for multiple trials by the end of the year across several regions, including the U.S., Latin America, Southeast Asia, Europe and the Middle East.

Our focus remains on completing certifications, conducting and converting trials to design wins and design stages in scaling our channel and sales infrastructure for broader adoption. With that, I will hand the call over to Michael for a deeper review of our second quarter financial results. Michael?

Thank you, Jacob. Before I dive into the numbers, I will note that my remarks refer to non-GAAP figures unless otherwise indicated. Reconciliations to GAAP results can be found in today's earnings release. Second quarter revenue came in at $13.6 million, slightly above the midpoint of our guidance and up 13% sequentially from the first quarter. Breaking this down by market. Enterprise revenue was $7.2 million, increasing $2.8 million sequentially. The growth was driven by strong demand for embedded modems and custom IoT solutions, specifically by end customers in the utility infrastructure monitoring market including energy management and electrical grid applications.

These customers can focus on their core expertise while accelerating their product development time lines with our modem solutions. Consumer revenue was $5.6 million, down $0.8 million sequentially, consistent with our expectations following the inventory pull forward tied to tariffs in Q1. Demand continues to normalize at healthy levels, providing a stable baseline for the company. Automotive revenue was $0.8 million, down $0.4 million sequentially, reflecting software demand.

Second quarter non-GAAP gross margin was 43.8%, down slightly from 44.3% [indiscernible] Enterprise product margins. Second quarter non-GAAP operating expenses were $6.5 million, lower both [indiscernible] compared to a loss of $1.2 million in Q1. Q2 non-GAAP net loss was $0.5 million or $0.04 per share. We ended the quarter with $7.7 million in cash and equivalents, up $0.3 million sequentially.

This increase reflects disciplined working capital management, underscoring our focus on cash optimization as we drive second half profitability. Year-to-date, we received $2.1 million in net proceeds from the employee retention credits we applied for 2 years ago. The ERC credits helped offset the impact of $1.8 million year-to-date non-GAAP operating loss on our cash balance.

Looking ahead to the third quarter, we expect revenue in the range of $30 million to $50 million, with a midpoint of $40 million, representing approximately 3% sequential growth. We expect the sequential growth will be driven by initial contributions from our platform products, including AC-Fleet and early Lighthouse alongside a stable existing business in consumer and enterprise. AC-Fleet revenue in Q3 is expected to come from Tier 3 and initial Tier 2 deployments, while Lighthouse will begin contributing modest revenue from early international [ trial ] conversions.

These early platform contributions are expected to build through the second half of the year and set the stage for meaningful scaling in 2026. We expect non-GAAP gross margin for the third quarter to be in the range of 42.5% to 45.5% or 44% at the midpoint. We do not anticipate a material impact from tariffs, although this environment remains fluid and may result in supply chain disruption costs.

We expect Q3 non-GAAP operating expenses of approximately $6.1 million, reflecting a sequential decrease of roughly 6%. The projected decrease reflects expense realignment within our existing product lines and a decrease in G&A expenses. At the same time, we continue to invest in sales, marketing, engineering and customer support to advance our growth platforms.

Our first half non-GAAP engineering expenses decreased by 18% year-over-year. Within that, we estimate the engineering expenses for our existing product lines decrease by approximately 50%. While investment in our AC-Fleet and Lighthouse platforms, increased by about 45%. Similarly, first half non-GAAP sales and marketing expenses increased 5% year-over-year, reflecting a roughly 20% decrease in our existing product lines and a 70% increase in our growth platforms.

We expect this realignment of expenses between existing product lines and new platforms to continue in the second half of the year. At the mid-term of our guidance, we expect positive adjusted EBITDA of approximately $0.2 million and positive non-GAAP EPS of $0.01 per share.

Now I will turn the call back over to Jacob for his closing remarks. Jacob?

Thank you, Michael. Looking ahead, our priorities are clear. We expect sequential revenue growth and a return to profitability in the second half of 2025, driven by a stable base in consumer and IoT modem sales, initial contributions from AirgainConnect and continued OpEx discipline. As we move into 2026, we expect our platform revenue to scale meaningfully as certifications are completed, global trials convert to deployments and customer budgets are released.

Airgain is well on its way to transforming from a component supplier into a platform solutions provider. I want to recognize the strength of our broader leadership team. This highly experienced resource-driven group works together to execute with discipline, engage customers strategically in position Airgain for long-term growth across both domestic and international markets.

I would like to especially welcome Gordon Schenk, our new Senior Vice President of Global Sales. Gordon wins more than 25 years of experience in high-technology sales and organizational leadership, including prior CEO and executive roles driving significant growth in strategic partnerships in the energy and technology sectors. His expertise will be instrumental as we expand our global reach and deepen customer engagement.

And finally, I want to thank our employees, partners and customers for their commitment and support. We remain confident in our road map, our execution strategy and our ability to deliver sustainable growth and long-term value creation.

That concludes our prepared remarks, and we are now ready to take questions from our covering analysts. Operator, please provide the instructions for the Q&A session.

[Operator Instructions] And your first question comes from the line of Anthony Stoss from Craig-Hallum.

Jacob, I wanted to focus on, I think you said there was 40 sales opportunities for the AC-Fleet product. When I sat down with Michael a couple of weeks ago, I saw the product was pretty slick, actually. So can you kind just confirm the 40 opportunities there and how long you think some of those sales will take to either convert or that.

Yes. Tony, yes. So all of these 40 opportunities, these are qualified opportunities already by the sales team. So they're actively engaging with the customers. And I would say about 10% to 15% of these 40 opportunities are the Tier 1 opportunities, the bigger size that's going to take longer. Although some of these opportunities, it's only been happening for several months. And I would say roughly about 30% or so is going to be what we call the Tier 2 opportunities, and one of them will really convert during the quarter. The rest are the Tier 3, which are smaller deals that we are actively pursuing and closing and those are the ones that are going to be more immediate.

Now to appreciate the fact that you check the device, and I'm sure that you're really impressed by the size and the feature-rich capabilities of the AC-Fleet, and that's the kind of feedback we're getting from the customers as well. They also really enjoy the performance. So all in all, we feel very optimistic about the product and that's why we're really expanding our investment in sales and marketing. We are much more entrenched with the partners. But what we're also seeing is that it takes time when it comes to certification, right?

And one of the reasons it's because of some of the unique features that we bring to the table. For example, we were very pleased about the AT&T FirstNet trucked certification was a certification that took us almost a year to obtain, and we were expecting only 6 months. And one of the main reason is the new [indiscernible] feature, which they don't even have the script to do the testing. That's why some of the delay was because of the added unique leisure that we are now bringing to the market with AC-Fleet, but all in all, we are encouraged by the progress, although we're seeing the bigger deals are going to be happening, likely closing the deal but more about deploying in the field in 2026.

Got it. And then maybe if I could throw a question to Michael. I'm not looking for a guide, but just kind of give us your thoughts on the December quarter. Typically, it's up sequentially. You think it's going to still be up sequentially? Or do you think it's going to be up significantly? Like what do you see in the pipeline that would impact this number? .

Tony. So Q3, Q4, as Jacob mentioned, I think we're going to benefit from a relatively stable existing markets. There are some puts and takes on that. Definitely, the consumer market, the embedded modem market are definitely the bright spots. On the consumer, the Wi-Fi 7 transition is currently very much underway, another T1 MSO has launched its Wi-Fi 7 offering. So this is giving us quite a bit of confidence that we'll see that market recovery that we've been talking about really underway and pushing through FY '26, especially as well as the embedded modem, we do see quite a bit of traction with that utility monitoring sector.

As Jacob mentioned, the automotive market, we still are hanging on to that excess inventory and also the asset tracker as well too. We do sense very much of a cautious environment with especially government agencies. That's what we're seeing right now on this excess channel inventory, some of the end customer deployment being delayed. And so while we are optimistic about 2026, in 2025, we're still monitoring that very carefully as well too. So what remains is really on the Lighthouse and the AC-Fleet that is our full focus, I mentioned on our OpEx discipline. This is -- those are the 2 markets that we really are focusing to invest on the sales marketing channel itself the overall engineering certification and just trying to make as much headway as possible.

And so the visibility on that all depends upon those Tier 1 and Tier 2, which is really our focus right now as a number of the trial that takes place on that. So I would say, relatively stable. Hopefully, some small but steady increase, but we're looking at to really scale meaningfully on those.

There are no further questions at this time. I will now hand the call back to Mr. Jacob Suen for any closing remarks.

Thank you all for questions and for your continued interest in Airgain. If I were to leave you with 1 key takeaway from today's call, it is this, Airgain is a more focused, disciplined company positioned to achieve profitability in the second half of 2025 and to scale meaningfully in 2026 as our platform opportunities convert to revenue. Operator, you may now conclude the call. .

This concludes today's call. Thank you for participating. You may all disconnect.