Aeluma, Inc. Common Stock 2026 Q4 Earnings Call

Please go ahead. Good afternoon, and welcome to Aeluma's fourth quarter fiscal 2026 earnings call.

I am here today with founder and CEO, Dr. Jonathan Klamkin, and CFO, Christopher Stewart. Today's discussions and responses to questions may include forward-looking statements, which are subject to various risks and uncertainties that could cause our actual results to differ materially from these statements. These risks and uncertainties are detailed in the earnings press release issued today, along with the reports filed with the United States Securities and Exchange Commission. These reports, along with today's earnings release and fourth quarter presentation that we will reference during this conference call, can be found under the investor section of our website. Aeluma assumes no obligation to update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this call.

Throughout the discussion, the company will refer to non-GAAP financial measures, including EBITDA and adjusted EBITDA. A reconciliation of non-GAAP financial measures to the most directly comparable GAAP measures is included in our earnings press release and SEC filings. Now I will turn the call over to Aeluma's CEO, Jonathan Klamkin.

Thank you, Moira, and thank you all for joining today's call. We are delighted to share a recap of our fiscal 2026 and to provide an outlook on Aeluma's path to commercialization. The AI datacom market opportunity has continued to become a priority for us. Demand for high-performance photonics is at an all-time high, with data center CapEx investments expected to reach $1.8 trillion in 2030, according to Dell'Oro Group, of which approximately 10%-15% is for photonics. As illustrated in slide 4, we explicitly built our technology platform for this scale. Our proprietary heterogeneous integration with large diameter non-indium phosphide substrates combines high-performance materials with mass market microelectronics manufacturing.

To capitalize on the AI opportunity, in fiscal 2026, we prioritized resources to accelerate development and commercialization of our high-speed photodetectors and quantum dot lasers, which are applicable across a broad range of data center connectivity, including slow and wide short-reach interconnects, fast and narrow interconnects, pluggable transceivers, near packaged optics or NPO, and co-packaged optics or CPO. Many traditional photonics components for data centers depend on indium phosphide substrates, which have become a bottleneck for suppliers and their customers. Aeluma's technologies are manufactured with non-indium phosphide substrates that may range in size from 150 millimeter or 6 inch to 200 millimeter and up to 300 millimeter. Aeluma's photodetector and laser technologies have undergone significant foundational development, thanks in part to non-dilutive government funding. We have always been selective in bidding on government contracts that are synergistic with our commercial ambitions.

An example is a Navy program that commenced in fiscal 2024 to develop high-speed photodetectors for short-reach links, a technology that is highly relevant to slow and wide data center interconnects for scale-up AI workloads. This Navy program has transitioned successfully into a second phase to focus on higher speed operation and transceiver integration. We have also made considerable progress with customers evaluating our differentiated photonics platform, which eliminates the need for indium phosphide substrates, supports high volume manufacturing, and provides a path to CMOS wafer scale integration and packaging. These engagements have helped shape the development of our Lynx S Series photodetectors, which target data rates from a few gigabits per second to 64 gigabits per second. Based on customer discussions and market forecasts, we believe these applications represent a substantial volume opportunity as deployment scale in 2028 through 2030.

To support fast and narrow 200 gigabits per second per lane and future 400 gigabits per second per lane for scale-out interconnects, we are developing our Lynx F Series photodetectors. This represents another significant potential opportunity in the growing AI datacom market. The non-dilutive government funding we secured played an important role in advancing our technology while also providing a potential long-term customer relationship with the U.S. Navy. As the AI datacom market accelerates and demand grows over the next several years, we have prioritized our resources on the commercialization of our high-speed photodetectors to capture this opportunity. Another example is funding from the Office of the Secretary of Defense and from NASA to advance our MOCVD quantum dot laser technology. Today, our data customers are evaluating our non-indium phosphide quantum dot lasers for high-temperature operation, reliability, and isolator-free packaging.

Our Quasar family of quantum dot lasers, currently under development, aims to address the demand for high-power lasers in scale-up and scale-out networks. We believe we are uniquely positioned as the first company to offer quantum dot lasers using MOCVD, an industry standard for high throughput production. MOCVD, for example, is used exclusively for large volume VCSEL manufacturing for facial recognition in mobile phones. Given the scale of investment and projects already underway for data center build-outs, we are more commercially focused than ever before. We stated that fiscal 2026 would establish the foundation for transitioning to commercialization. We delivered on this objective by expanding our team, establishing manufacturing supply chain partners, bolstering cash, and focusing on our go-to-market strategy. At June 30, 2025, Aeluma had 14 employees. As of today, we have more than 30 employees and we plan to recruit additional talent to execute our strategic priorities.

In June, we announced the appointment of Dr. Brendan Moran as VP of Engineering, whose distinguished career at Lumileds included leading product strategy and development for mobile photonics components that generated $300 million in annual revenue, eight consecutive design-ins for a high-profile mobile customer, and shipping of billions of photonics chips. Brendan is driving Aeluma's product development and commercialization efforts with an emphasis on photodetectors and lasers for AI datacom. Along with Dr. Willy Rachmady, Aeluma's VP of Strategic Partnerships and Ecosystem, and myself, Brendan is helping advance our engagements with customers and define technology and product development roadmaps. We believe our product-focused strategy will benefit our business and our shareholders. We also recently appointed Jason Taylor as Senior Director of Program and Project Management. Jason has nearly three decades of experience in program management at Intel, Kyocera, Lumileds, and other organizations.

Jason is leading program management across Aeluma and is building out a program management system to ensure timely execution of priority programs, including high-speed photodetectors and quantum dot lasers for AI datacom. Such a system is key to delivering on our strategic priorities. I am also proud to welcome Dr. Pramit Parikh as a strategic advisor. Pramit was VP and GM of the gallium nitride business division at Renesas following the acquisition of Transphorm, Inc., a pioneer in gallium nitride power semiconductors that Pramit co-founded and led from inception through its public company listing and acquisition by Renesas. He also held leadership positions at Nitres, Inc. and Wolfspeed. Pramit's expertise spans several areas important to Aeluma, including high-performance semiconductors, AI data centers, manufacturing, IP strategy, and partnerships. He provides a strategic and operational perspective to Aeluma as we position the company for commercial growth.

We are again adding more office and meeting space to support our growing team. While we continue to be stewards of capital, the time for making investments in growth is now. Moving through fiscal 2027 and beyond, we will be even more selective with government funding and more commercially focused. This may mean sacrificing near-term government contract revenue to focus resources toward achieving commercial revenue and growth opportunities, which is what matters in generating long-term shareholder value. In previous communications, we shared our intention to move away from early-stage government funding and instead focus on opportunities that accelerate manufacturing and commercialization. Consistent with that strategy, on July 29, we announced a letter of intent with the Department of Commerce CHIPS R&D office for up to $30 million to accelerate development and commercialization of our scalable photonics for AI and advanced computing.

This is not for a specific Department of Defense or NASA or Department of Energy or other agency-driven application with technical metrics established by the government agency. For the Department of Commerce program, we proposed Aeluma's own vision. That is to build the world's highest performance photonics with scalable manufacturing, leveraging domestic capabilities and advanced intellectual property to overcome supply chain constraints and to meet the demand for critically important AI and advanced compute infrastructure investments. These themes have been central to Aeluma's strategy since our founding. The CHIPS initiative is aimed at supporting semiconductor innovation across integrated photonics, compute architectures, advanced packaging, substrates, materials, and memory for the AI and advanced compute supply chain. This strategic government investment could accelerate our development and commercialization efforts.

On scaling, I am happy to announce that we recently executed an important agreement with Sumitomo Chemical Advanced Technologies to strengthen our relationship, increase wafer production capacity, leveraging existing MOCVD tools that we can run our processes on, and provide a path for further increasing capacity in the future. We have been engaged with Sumitomo Chemical Advanced Technologies for several years, and this new agreement will support commercialization efforts and will complement Aeluma's in-house capability. The initial focus of this effort is on high-speed photodetectors for AI Data Comm. For future scaling, we are procuring multiple AIXTRON G10-AsP MOCVD systems. These types of tools are already in use by major tier 1 photonics component manufacturers for lasers and other photonics components for AI Data Comm. Aeluma recently configured these tools to implement our proprietary non-indium phosphide substrate processes, and we are planning for installation.