GSIT - Earnings call transcript Q1 2025

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the GSI Technologies First Quarter Fiscal 2025 Results Conference Call. [Operator Instructions].

Before we begin today's call, the company has requested that I read the following safe harbor statement. The matters discussed in this conference call may include forward-looking statements regarding future events and the future performance of GSI Technology that involves risks and uncertainties that would cause actual results to differ materially from those anticipated. are Securities the and uncertainties filed Form and the with Exchange risks described company's in XX-K These Commission.

XX, being Additionally, to I today, is Technology. advise asked the July recorded you that of have this conference also GSI XXXX at been request call

Hosting Officer; Shu, company's over and I Vice of and is Didier Chairman, are Douglas would Lee-Lean With Please go Shu. Sales. to Mr. call Executive Lasserre, to Officer. him today turn now Schirle, the President call sir. the Chief Chief the like Financial President ahead,

Lee-Lean Shu

FY day, earnings welcome Good and to everyone, our first quarter XXXX call.

Let's with QX start results. the

Our despite of lower $X.X to revenue first and sales was lower sales quarter contractors. within range SigmaQuad prime our our guidance military million

cost a margin come on for our is effective legacy Additionally SRAM APU the mixed generating business. range of low guidance. in team to revenue our address our lower our causing in Right to margin products end at focused -- new affect we our of decline Gemini now, gross our the saw

Our achieve return where to bring reverse business revenue and Gemini-II to with Gemini-I help and stability contract launch more when This the is main SBIR this line secure us with decline new to Gemini-II. goal growth ultimately financial year will online. we

explain how this goal. working me we Let towards are

Gemini-I, built are be preparing We to available on-premise launch platform for which will on solutions. a our Vector Search, GXL Fast new with cloud-based,

detail Didier create using rely time the that critical more to GenAI data for a reduce and providing intact, timely large e-commerce, advantage significantly technology on provide needed on breaking own updates. and vector update Our database increasingly this. will companies

over can business This to our so XX department research, for proposal from repay $X to months. Additionally, we over contract $XX,XXX the out SBIR Typical innovation million. Gemini extending different X pipeline of small APU. range are

will extend we in where this own further our are DDR far, complete calendar companies. in our track his them to and contracts Phase SBIR SBIR we opportunities Phase II milestones XXXX. announced I So meeting and on

in on We on XXXX. track software are The chip also to to software been team allowing to mounted it. customer has the board, our sampling early calendar Gemini-II with work begin successfully

goal to by firmware delivery the and complete Our software XXXX. is December the finalize

have for The all success the in of continue they firmware roles we is our software with -- labels. mass to good news uncovered at work We change, [indiscernible]. chip all that and multiple development without along thanks working to

We are funding actively the for and thinking future resource, scale partner development. strategic to expertise

XXx successful have in by billion strategic our quarter the aim improvement increase to partners. team We is with successfully will a enable demo, demonstrate engagement, productive validate more us Gemini-II. chances to [indiscernible] this spread with showcasing memory the more discussion compute with To of preparing concept to potential this $X than to December the

the diligently are and earlier, we II launch and As I monetize platforms. stated Gemini-I to working

preparing a in revenue are the GXL launch Fast market. stream We to recurring Search the platform to Vector establish

memory remaining APU With computing time are the deliver solution market. [indiscernible] AI of Gemini-II. computing we pipeline and promises revenue proposals a power expanding build to costs stream to addition, In saving of capabilities, memory unique and the offset this SBIR actively rapidly development future essential our to

Didier. over Now go our business Please development call discuss Didier sales I will who activities. to hand the ahead, and

Didier Lasserre

of you, launch of Thank Lee-Lean. to and the Lee-Lean GXL I pipeline. topics pending our want SBIR highlighted, on building X expand that the

and Search called the Fast market Vector our platform this with for new start Let's GXL.

quick algorithm fast, because Vector to Vector GXL search databases the provides it's build GenAI it me solves is use size First, and for search Many of and The results. the with indexes growing let especially basis e-commerce. important. explain and these why accurate similarity problem of HNSW

accurate information. a for databases However, needing a is takes which time, building and long problem index fast an HNSW

needed refresh crucial. most to making of calculations One way faster the them parallel. up calculations by is running index to so fix build them this time, in take speeding or the the is These by

is Our level in CPU-based issue. at about technology big the This traditional by quickly, for compared It APU handle in-compute with the processing, data solving memory slow The solutions. bit the memory means APU can build this. processes millions the working amounts parallel of designed directly enables of it reducing processors index XX% simultaneously. building time massive to data index

The e-commerce solution provides applications to Vectors. to GXL as are these It fast benefits scalability. and information for of grow billions recommendations X our of access main even GenAI

are And cloud is cost. in hourly, benefit last lower computational money. where it is operational costs billed saves using updates. benefit Second computing, the less time, especially By for resources faster

be can applications, and deleted increased the recommendations revenue leading added to quickly products index e-commerce timely into more or opportunities. New in

and the We with indexing. we medium blog white to to players. information. companies HNSW that out on begin the paper me, a prepared have about to for we e-commerce aim recently published to and then sure check is for vector platform be -- launch, those being connecting identified larger GXL Be more a check efficient and database expand excuse The sure

our and regarding execution of the the APU from prioritizing and for within applications large use divisions our APU's statements commercial. of contracts. these the will have have Department bring Defense of why the way for This of as our of II DoD with opportunities multiplier benefits these many within defense and SBIR submitting focus or these and we DoD. Phase performance on highly efficient DoD. many dual and These GSI's a focused effect resources and build-out is then future effective the SBIR can significant of strategy validate increasing landing pipeline a view awards contracts the and to as We on Switching awareness Phase the I proposals

excuse on now me, we in complete. SBIR Air XXXX which I and II million, are we We -- with are XX% $X.X are a on Phase worth working Force working a Phase over the contract started

Phase We has are a to X with and largest to on of XX% technology. Additionally, we project. million, valued division the contract It a the I a DoD, Agency new complete divisions Development value SBIR we have over the up with that's new this SBIR GSI Phase a secured of $X.XX II $XXX,XXX. Space APU's at recently

We is this on latest the win will give contract signed. once details more

currently proposals, of a are up We pipeline several adding total million. $X to preparing other SBIR

Our space worth II level a onboard next Phase submission will million. SAR contract be $X.XX for

In line addition applications. enhance version to will SBIRs, Gemini-II to us further we have funding for resources funding dedicate could to process the advanced creating to This the initiated edge seeking the enable a government expand product by additional we AI developing GX. of

On Leda this contractor June the a and September provides software defense GSI various major applications. a APU to aerospace Gemini-I We for appeal shipped trading in we a and sold the underclosed final quarter. will card evaluate quarter, card note regarding the technology opportunities, also in who

revenue, minor valuable this contractor. is engagement Although this opportunity prominent these for with sales prospecting generate

are to see customer We using excited technology. this our

is we Regarding calls, finalized that with some hold the X as in SAR documentation customer. processes one on previous we've mentioned

The of where other the use could expand the is APU. different looking possibly our to of we their that services operation scope in can they areas provide

actively services. team Our investigating accelerate to delivery how additional is the of these

Now were $XXX,XXX or prior first period sales same net $X.X the of quarter's compared let XX.X% of quarter. quarter the and or XX.X% and Nokia $XXX,XXX year a million the in breakdown. product In the customers to revenues me XX.X% to ago fiscal net XXXX, or first of of switch revenues to revenues

to ago the period first defense of were prior quarter XX.X% year compared the a sales in of XX.X% of shipments in comparable quarter. shipments Military and XX.X% shipments

SigmaQuad shipments prior first fiscal to quarter. sales in quarter of the XX.X% of first in were XXXX XX.X% XX.X% compared quarter the and

for has placing we the will other orders largest announced our Regarding calendar customer business orders the remainder for the end current managing expectations year. Several levels, they and some inventory remain outlook, customers before their our stable resume while them SRAM SRAM the challenges, our are year. anticipate of calendar currently of business from

like have that Additionally, their please. I'd customers Doug. we call to use stabilized. to ahead, SRAMs over of previously Doug were hand go believe the reducing now the now who

Douglas Schirle

Thank and quarter fixed fiscal contractors. Gross cost compared $X.X you, quarter to of of the quarter and The XXXX. costs primarily of of XX.X% quarter in first decrease The XXXX to XXXX was company margin in due revenues $X.X in and recorded our decline in the lower Didier. first military prime quarter million was sales lower of XXXX. of lower ago the sales in fiscal first The revenue year and XXXX gross fiscal of the to mix revenue revenues. XXXX the the to was SigmaQuad margin and million million for and for XX.X% fiscal first effect from of of on in fiscal compared quarter due preceding first the of fiscal the fourth XXXX product fiscal fourth XX.X% $X.X for net quarter

prior million compared $X.X $X.X in of operating in XXXX period prior $X.X $X.X quarter first quarter. Total million development and quarter million, in were to million to the expenses XXXX of prior Research fiscal $X.X the million, the and $X.X quarter. expenses in were the and compared first the million fiscal in

administrative were the year in in compared million $X.X previous the general prior and quarter $X Selling, to expenses June XX, million in $X.X and the ended million XXXX, quarter quarter.

an the fiscal operating year was and First operating operating million, quarter. loss loss $X.X XXXX $X.X the prior an million period of of in quarter prior million loss in $X.X to compared

same tax interest period quarter of and interest $XX,XXX. of other and $XXX,XXX benefit provision provision First loss preceding a tax of in $XX,XXX, and fiscal of fourth income compared $XX,XXX income a year $XX,XXX a income ago. included for the quarter, income and of other $XX,XXX included net a the net XXXX and to tax In other

for was reflecting sale of to gain the transaction of one-time $X.X share, Net income per related quarter or of a or the or on for headquarters XXXX. net XXXX in the of Company's of to compared $X.X the $X.X loss $X.XX fourth fiscal and per diluted leaseback quarter million diluted first million of fiscal and sale the $X.XX $X.XX a $X.X the quarter per of net loss million share a first fiscal diluted XXXX million share

to pretax quarter. first in year quarter compared ago $XXX,XXX prior comparable compensation the in stock-based a $XXX,XXX was quarter the $XXX,XXX and Total expense

March $XX.X cash capital June the million XX, at as million was At of March million of June compared $XX.X XX, XXXX. cash and $XX.X XXXX, Working company million equivalents $XX.X compared XX, to XXXX, had to at XX, XXXX.

of million fiscal ended year XXXX. March equity June the XXXX as $XX was to million XX, of Stockholders' compared as XX, $XX

review the quarter and a committee During a strategic initiated the our to established special in earnings alternatives. strategic of had May, that evaluate Board comprehensive fourth very announced we company call

final adviser to We Q&A. strategic call will direction are this the process. Currently, open potential as encouraged our discussions. these engaged financial to Company in opportunities regarding discussions Needham preliminary are the we -- this we in point, of strategic have & by and assess adviser Operator, at and

Operator

first Instructions] [Operator Luke Our Bohn. question comes from

Luke Bohn

more to brief seems diverse route, could a and potential the if you this kind potential or partnership. as in all or skim do about wondering for benefit out key over contemplations laying of call going it leasing you're which well a I'm like sale cost as

those If current you succinct refinement leading of could kind all give your direction? prospects and of a

Douglas Schirle

you Are how [indiscernible]? are you What asking exactly asking? to we about decided

Luke Bohn

-- if and development you or sorry, Not about a build-in. progress to building the in on No. the referring we're had since Gemini-III. prior to, call the GPU decision And a Gemini and the route yes, calls, Talking APU, project. up last hopefully, funding -- APU to the for

So if way or are of you're you of major prospects technology? succint the what a to like had kind just I funding way for currently wondering either that a leasing leading of describing

Lee-Lean Shu

we on bit need have we But Hyperscaler X and processing. capability continued to vendors. on APU HBM key the really Gemini-III X bit and with the Yes, still our is demonstrate discussion

we doing calendar the year, on focused we the this the and prove to want of it end So and are year. by that's this how GX

Douglas Schirle

Yes.

the of So there's but capabilities where see some them benchmarks. we parts, so can definitely interest, like the show to they'd

that on working we're So now.

Operator

Our next Michael Cooper. from question comes

Michael Cooper

clients me, with process these you in-house, these you that the know you them? the then have now you Do are have these outside start to validated showing questions pipe? to and Can tell coming and down answers formalize benchmarks benchmarks, for the

Lee-Lean Shu

on run right That's it's now. get calculation, And now, working, it are actual We we why GPU can have -- a a right but trying calculation. basically just Yes. to the so we doing device. we are the can we

Douglas Schirle

working silicon. Yes. the We're first silicon. major And for bugs, with we've I silicon be as And actually before, very think turned has out mentioned the working are first to no first there right and a solid around. as gather nothing with board on accessing and the that can They've we we're work been as And we can't data have. mounted trying much information to part. what we now

Didier Lasserre

to order be of need on in And benchmarks, the run we complete. side to able Right. and algorithms the software the all those libraries just

that bugs said, Lee-Lean in side, been showstopper are have as there hardware his the on section, at So no point. this

so just so completed it's getting run libraries And benchmarks. can the we those

Michael Cooper

the points, libraries critical those less in pinch algorithms, you if there's And will? and

Didier Lasserre

you lot potential -- of different, you the Well, and moving have hardware, It's right? parts bugs. of a with it's just lot have a

the complete those With our done Israeli It's and folks being facility the a matter by just software just time. time to it's libraries, and it's the libraries. just of that's

Michael Cooper

And question like? say what what's more if [indiscernible]? How does thousands channels? $XX,XXX your is a large all the this. that And about, one margin? within I could okay, just you And extend does the let's achieve the Or hundreds system? market Hyperscalers might buy look or What it like gross potentially of

Didier Lasserre

Sure.

is to market a little Gemini-II So than going different Gemini-I.

can to some and is recall, have board/systems. a models cloud-based usage a different. different. expand we say We So Gemini-II you little Action Gemini-I that. if some we sold then also little

looking of cloud-based at be So we're we're will revenue. the some models kind -- usage of

be will the systems, the and is to key of at, some very boards which chips. to we sell markets selling but looking some some have, We we're actual also opportunity

so chip not can about Gemini-I, And that Gemini-I. With there's leaderboard we've as chip with with sale talked restriction, the not sell we Gemini-II, the was viable. original on well. on FPGA was So that the an dependence

a then may And buy boards. kind to want in to be, server our may the And a multiple of buy buy They cloud-based has like will want that some chip. revenue. want a customer, so said, They depending revenue they a it may I streams, of to on board.

Lee-Lean Shu

processing the targeting who on market, cloud not and is right depending We on publishing growing [indiscernible] market market, like data a whole at The HAI are targeting the anyway, Yes. depending to Gemini-II now is But computing HAI base. billion mid-$XX mid-XX the HAI in is the [indiscernible]. XXXX okay? the mid-XX -- at

market think I [indiscernible] So are targeting. that's where it's market, we and the

Operator

comes question from next Greenberg. Our Greg

Unknown Analyst

now? last update and on that's you us radiation what you quarter for X from give programs? an the X, hardened X, happened see Anything Can the in years

Didier Lasserre

Sure.

quarter shipped actually to order So Europe. past out this prototype a we a of customer

have And so to be some are last of active further some into years. going still samples set we that that's testing. ongoing There over the couple programs

Hard are are production. then still waiting And go And into so few targeting. to that to we're just others a those say. there

XX% are this of this run kind margin the on always We've the of a for And talked kind about said is million that north we kind we looking $XX rate. year of of gross again, product.

the you been much on in as we been know, these it's that years if saying still the just calls we're past, you've had been So ever ahead. than in It's -- just a anticipated. slower process

Unknown Analyst

maybe you go a already think has or been it mentioned I need What's in to the that there? And few space? quarters it space didn't up status in you ago, up

Didier Lasserre

so to we So I know, don't heritage. yes, referring Yes, you're heritage far as yet. have as

a these possibly the just we're this we're what way heritage sound they we're know exercise not It's -- launches. it that those space in now, so to in just we prove the do only. of would actually space a on for And working parts just little for to waiting to program strange. It in with about be And would can some work is that going some also parts the the not associated I be seeing getting environments.

mean, the done all earth. that environment we've I which testing done, on stimulates is

And actual that are these so but you tests done the tells it proof. work, will folks we want certainly all

get so on and the stamp can try to that we official have heritage now mechanism a for parts. looking we're So parts up our

Unknown Analyst

back to then And Okay. APU.

you still that back? when second expecting spin, you're So a would expect

Didier Lasserre

-- not So spinning yes, so part actively yet. we're we're the

They've There looks are silicon first very minor software this discussed, at bugs. all point. had we some workarounds as solid. So

these determine And or to whether are bugs. there we'll about, other And we'll so that's then be as we any up to algorithms libraries and done, the not able talked do continue once finish we spin.

minor So off of any we other as bugs. on now, can until we're spin holding identify any

Unknown Analyst

So correct? have able so you alternatives second strategic to guys read spin be a far, that I see doesn't partner can what into to require know to a

Didier Lasserre

for just expand correct. but that's -- also in Correct. Yes. to that the The second and is our spin, generation general, business we the strategic for need just won't partnership more next part for

Operator

from comes question Robert Christian. next Our

Robert Christian

any that Have you guys your in identified are licensing technology? interested possible companies

Didier Lasserre

now not is on or -- actually competitors with -- are this about customers. not the right sure we potential So customer on I'm you're if so working talking side,

now, do for a -- our time a customer are some the incorporate at looking IP on is networking that we've and So into And technology customer it side, be like have major ASIC. we along. their having getting it's able to of been the looks conversations telecom those bit further to some

to out And And get before faster. had We actually technology. it's of the will Gemini-I that Gemini-II they're wasn't looking conversations some once obviously, now it be had progress Gemini-II. we benchmarks started the for, we and even that

Robert Christian

other buying is as it there there, And Good. the that's in interested Okay. companies is now? any right company out competitors

Douglas Schirle

having Well, encouraging, talk about to Needham lot are with of a discussions nothing we've yet. been and things but there's

Operator

It questions closing Mr. back I appears are there like floor over the at further would turn for that to comments. now Shu this to no time.

Lee-Lean Shu

you joining for Thank all us.

you speaking We result. forward our will Thank look with second to XXXX fiscal when quarter we you. again report

Operator

teleconference. today's concludes This

You your lines at may this you your time. disconnect Thank participation. for

Operator

Call. Fiscal thank Technologies and Welcome by. Ladies to for GSI gentlemen, standing Results First Instructions]. you Quarter [Operator XXXX Conference the

Before that involves and Form The include following in Exchange the in Securities that those safe anticipated. described I statement. cause with to has that we risks read results performance company's call, the GSI may actual from of Commission. matters are company and the uncertainties materially statements future harbor this today's Technology future risks These would forward-looking the requested the uncertainties and differ regarding discussed conference filed events begin XX-K call and

call conference XX, this today, that request of is you advise to asked been the at also Technology. XXXX being have July GSI I recorded Additionally,

Officer. With Chief is call ahead, Chairman, sir. today would Lasserre, go Executive the call Schirle, over turn and Financial Vice Mr. and the Shu. President Officer; are President I like Lee-Lean Douglas him Shu, of Sales. the Didier Chief now to company's Hosting Please to

Lee-Lean Shu

to and quarter everyone, first earnings welcome day, our call. Good FY XXXX

with results. start the QX Let's

first prime SigmaQuad contractors. sales quarter within lower of million lower Our sales guidance revenue and our despite military $X.X range to our was

in of mixed business. on of the lower come revenue our to range our decline -- our Right the for affect now, to legacy Additionally is saw low gross cost SRAM products team guidance. a focused our margin end new in at we generating address causing our margin APU effective Gemini our

Our main with stability secure to will to Gemini-II. us contract financial decline growth we with business new return SBIR to goal the this achieve This year help where is line more and Gemini-I launch reverse and revenue when bring online. Gemini-II ultimately

Let working towards me are explain how goal. this we

new solutions. We platform are on on-premise our Vector GXL for be built which a Search, with will preparing cloud-based, to Fast launch available Gemini-I,

on breaking own Our needed advantage will database companies that intact, time reduce timely using rely to vector providing and technology e-commerce, on this. create a data update detail large the updates. GenAI critical increasingly significantly and provide more Didier for

are Additionally, can the Typical X to APU. we our repay research, pipeline XX million. Gemini of innovation over business contract $XX,XXX department extending range This out for over $X so to different SBIR from small proposal months.

SBIR So where our far, complete own our we them calendar milestones further and to this announced meeting extend are contracts and will Phase II in XXXX. companies. DDR his SBIR in Phase on I opportunities track we

our mounted on track to Gemini-II work XXXX. allowing also on board, are the has early it. customer The to software been team successfully software chip with in begin We sampling to calendar

software December by complete Our XXXX. the to the firmware and finalize delivery is goal

change, and without labels. We the have continue in to thanks working that for firmware of is along multiple with at to roles [indiscernible]. work they uncovered chip we good success all mass The all development software our -- news

for the thinking funding resource, development. expertise to actively scale strategic are future We partner and

a preparing in with $X aim strategic showcasing demonstrate successful with To increase concept is will potential to spread to team compute successfully discussion the improvement We December XXx Gemini-II. chances to of [indiscernible] the more more with validate productive this partners. by us enable our the than engagement, billion to memory have demo, this quarter

monetize launch working and As platforms. II Gemini-I I earlier, we stated to are diligently the and

in We the to Fast a Vector recurring Search the revenue to market. stream launch are preparing platform establish GXL

expanding proposals promises solution deliver addition, unique Gemini-II. build to our remaining In power costs pipeline future of development memory APU and computing stream revenue offset computing time and actively to we to essential saving SBIR a are AI market. [indiscernible] the this rapidly memory the With of capabilities,

Now sales Please I who activities. business Didier go over discuss hand ahead, and to the will call Didier. our development

Didier Lasserre

to you, launch topics X pending want expand highlighted, of that Lee-Lean. I on the of building Lee-Lean pipeline. SBIR the GXL our Thank and

our Let's market new start with this called GXL. platform the Fast Vector and for Search

explain and GenAI indexes algorithm important. Many First, why solves of is especially use similarity fast, the quick of to because basis for search and e-commerce. search it's Vector Vector GXL growing results. let provides The me HNSW problem with it build and these databases the size accurate

a a needing problem However, building takes which databases for accurate an HNSW index time, long fast information. is and

them way refresh by One These the calculations build fix needed faster is making index calculations the so time, is this parallel. crucial. to them the up speeding or in of running to by most take

building to by technology solving build traditional in APU quickly, at enables this. amounts slow memory time directly the the processes compared of The reducing issue. XX% processors working parallel can it designed in-compute about massive big handle with solutions. bit the level This index of memory data data Our means millions CPU-based is simultaneously. the index for It APU processing,

of access main GXL X benefits GenAI to billions information grow e-commerce The recommendations applications and Vectors. even as for provides these to of scalability. fast our solution It are

where Second is billed are lower last And it especially cost. By computing, benefit money. benefit cloud faster operational time, less costs is saves resources in computational for hourly, using the updates.

be to into added in the recommendations timely index increased leading and more or deleted quickly revenue opportunities. applications, can e-commerce products New

vector players. to and the begin is out have being excuse those the launch, be with identified to sure We paper The to about for larger we check aim HNSW me, expand sure indexing. blog prepared we check -- to platform for more a e-commerce then recently a published information. white and on medium companies efficient connecting and Be database GXL that

our SBIR the and strategy these the Switching can I awareness increasing many applications dual APU's landing have the from on DoD. of use Defense We Phase a DoD the Phase APU large and statements and regarding focus view to II the efficient build-out of pipeline as SBIR and these highly within DoD. on These effective our or GSI's validate and awards our a Department contracts way the of of multiplier divisions as with effect proposals then prioritizing future these of defense for execution commercial. will bring is for contracts. the benefits performance resources why within we submitting focused of opportunities and many This and significant have

We me, a $X.X which -- Phase Phase are working with XX% complete. on contract on Force working Air I SBIR and now excuse II we we XXXX a million, in are the are worth over started

Development a Additionally, has up Space II to with XX% Phase largest DoD, Phase $X.XX complete It GSI $XXX,XXX. new that's a Agency value secured at the contract a million, We project. and divisions are technology. new SBIR recently division we over SBIR I this X valued we of APU's to on the have with the of a

once give will on win the is contract signed. this We more latest details

are preparing to up currently $X pipeline proposals, of adding We a million. total several other SBIR

a II million. space contract next onboard submission level be for SAR will Our worth $X.XX Phase

In Gemini-II by edge we could addition funding dedicate enhance applications. the further of additional us This version the have seeking expand line funding developing product process to SBIRs, will AI the government we advanced to to for creating to a GX. enable resources initiated

the quarter. major shipped to underclosed trading We in appeal a quarter, contractor for evaluate various card who technology applications. card the June On we a a and APU Leda provides and final defense the in September aerospace also software GSI note this Gemini-I regarding will opportunities, sold

with these generate revenue, Although contractor. valuable prominent prospecting is minor opportunity sales this this engagement for

excited technology. customer to our this using We are see

is finalized some documentation processes as we mentioned that SAR one in calls, Regarding the X hold previous with we've customer. on

The possibly scope the the different other expand our their operation of of to we can APU. could use where is provide they looking areas services in that

team of additional is how actively the these services. to Our accelerate investigating delivery

of same revenues or me first XX.X% fiscal million let or to were and first to XX.X% revenues breakdown. of compared customers quarter's to net a the of Nokia Now sales XXXX, year $X.X product in $XXX,XXX quarter. quarter net of $XXX,XXX In and revenues or ago the switch the XX.X% period the prior

quarter to quarter. XX.X% the XX.X% comparable and in sales first year ago of shipments a defense shipments compared period in of the Military prior of were XX.X% shipments

SigmaQuad sales prior and in XXXX of were of XX.X% first the the quarter XX.X% to shipments first XX.X% quarter in compared fiscal quarter.

while calendar largest end and current our remain customer stable of orders will challenges, business remainder SRAM customers managing our Several some inventory of anticipate resume has business for for announced SRAM the the placing expectations are before from our levels, orders outlook, currently they year. Regarding we them year. the other calendar their the

ahead, we who reducing stabilized. Additionally, go call customers like Doug. believe to that please. the now to now the of SRAMs I'd were have previously their Doug over use hand

Douglas Schirle

quarter first XXXX of contractors. Gross in fixed quarter of XXXX costs million XX.X% revenue you, from compared in Thank for and lower gross in sales quarter The mix company first due to XXXX. of of the and ago XXXX and fiscal sales and revenues quarter XX.X% due on XXXX fiscal The to $X.X year in $X.X was fourth fiscal our fourth of of first fiscal and XX.X% effect margin was of SigmaQuad to decline in of The preceding to fiscal the XXXX. of the and margin the product quarter revenues. decrease the the in lower million compared XXXX first fiscal Didier. primarily cost recorded prime net the lower quarter for was for $X.X fiscal million the first quarter revenue of military

$X.X million quarter to the million and expenses period development of $X.X in operating $X.X in prior fiscal prior the of Total in million compared million, $X.X prior the were quarter XXXX were quarter. quarter. first the fiscal expenses $X.X $X.X XXXX first million, Research compared and to and the in million in

XXXX, administrative the to XX, were Selling, prior year in million compared $X and million the quarter expenses June quarter and in $X.X ended million in general $X.X quarter. the previous

quarter. First $X.X loss $X.X fiscal the million an to quarter year in operating million, XXXX operating prior period was prior loss compared $X.X million of and the operating an loss of in

XXXX tax the benefit other quarter of to tax year $XX,XXX other fiscal the fourth ago. income interest of $XX,XXX, a income $XX,XXX net for preceding included quarter, tax First interest and provision a $XXX,XXX and in compared a In and of $XX,XXX. of period income a same $XX,XXX of income and included other net and loss provision

the or $X.XX net fiscal a compared headquarters fiscal transaction loss the per and in per diluted fiscal $X.X and XXXX loss reflecting was sale share $X.XX a of quarter million income share the the the related or quarter to a $X.XX million of first to of Company's $X.X of of net sale of per one-time $X.X leaseback million on share, quarter diluted gain million XXXX fourth of Net first diluted $X.X XXXX. for the for or

quarter first $XXX,XXX to and $XXX,XXX the in in ago $XXX,XXX quarter. compensation stock-based comparable a the year prior expense Total was quarter compared pretax

XXXX, June at million and capital of XX, company At $XX.X to XX, million XX, June as March March million of the $XX.X XX, million XXXX. XXXX. equivalents XXXX, at was Working cash to $XX.X had cash compared compared $XX.X

June XXXX. million as Stockholders' year fiscal to ended compared XX, XX, equity million was $XX the as of of $XX XXXX March

to and alternatives. that established initiated our evaluate in comprehensive the had quarter review a May, of a strategic company call strategic committee special earnings the fourth Board During we announced very

assess the of we & Company in opportunities to this Needham at discussions engaged adviser are will direction strategic open process. are to Currently, adviser in point, and our discussions. and have preliminary -- call Q&A. encouraged these final financial potential strategic this as Operator, the We regarding by we

Operator

first Our Luke from Bohn. comes Instructions] question [Operator

Luke Bohn

well a diverse cost sale seems could a potential kind call this you out of it like benefit skim partnership. or laying route, potential if or as do in and brief wondering all contemplations to the over for going as key more you're leasing about which I'm

give leading direction? current of those all prospects If of refinement your you kind a and could succinct

Douglas Schirle

you What decided exactly are how we you asking? Are to about asking [indiscernible]?

Luke Bohn

No. a hopefully, Talking the had to, APU build-in. building prior we're to the And Not project. a to APU, about development Gemini-III. calls, call referring yes, for the in GPU or -- the and progress -- on sorry, and route if you the last up Gemini funding since decision

leading currently describing succint a to either funding prospects that kind just you a you're of I So the leasing wondering for if are major or of had technology? way of way like what

Lee-Lean Shu

still key demonstrate and have capability bit we on But X on to need and the bit with discussion X Hyperscaler APU continued HBM processing. vendors. we really the is Yes, Gemini-III our

to So that's of and want it on year, calendar the doing are GX and the the we this year. end we focused how this by prove

Douglas Schirle

Yes.

but So there's benchmarks. capabilities interest, definitely where see they'd the them like to some can we the show parts, of so

So we're working that on now.

Operator

question from next Cooper. Our Michael comes

Michael Cooper

them? Do now with know you these formalize these answers outside down these you questions the have process pipe? me, to the coming you then benchmarks for the start benchmarks, that are in-house, Can you validated and clients tell showing and to have

Lee-Lean Shu

the can basically Yes. working, are We but can -- doing we That's now, have so GPU get to right it trying a just on And device. actual right we calculation. why we it's are calculation, we a the now. run

Douglas Schirle

no They've major mentioned Yes. there before, think silicon. has solid be actually working We're And very the to we've I first out the turned are first we what bugs, as with we're And a mounted that now silicon first gather for silicon. part. can board much as right as can't nothing around. with we we data accessing and And the and information work working have. trying to on been

Didier Lasserre

Right. all the we And of in need the be libraries able just side to on those benchmarks, software complete. algorithms run order the and to

the are his on side, bugs point. said, showstopper So have Lee-Lean at this no there that hardware in section, as been

so libraries it's getting And just so we the can benchmarks. run those completed

Michael Cooper

libraries And pinch and algorithms, points, you those will? critical if there's in the less

Didier Lasserre

have hardware, Well, and right? lot bugs. it's of parts -- moving lot the of potential a you you It's different, just a have with

the being Israeli done to complete time facility those time. With that's of and a by the software just just just our it's the folks libraries. it's It's libraries, matter and

Michael Cooper

does extend could say one does gross that about, the is buy And $XX,XXX I this. all system? achieve Hyperscalers more question just you How a margin? what if market the let's potentially What okay, like or hundreds And channels? thousands like? within it the your might And look [indiscernible]? what's large of Or

Didier Lasserre

Sure.

market than Gemini-I. to So Gemini-II different is little going a

different. if we different. We have you to Gemini-II little then a Action usage sold can some say expand we that. a some recall, is also So cloud-based models Gemini-I and little board/systems.

So kind of looking be usage the we're -- of we're will models at cloud-based revenue. some

to actual is selling the sell systems, we to opportunity also and of be which the looking very some chips. have, boards but at, some we're key will markets some We

that So with chip so on talked the Gemini-II, well. on sell FPGA was original Gemini-I. With was the viable. Gemini-I, the dependence restriction, there's not as that sale about leaderboard chip can an And not we've we with

our multiple And of so a They And board. depending will revenue on cloud-based server a buy buy chip. of boards. I a revenue. to the customer, to be, want some a they may buy it want then in streams, said, want like that They may may has kind to

Lee-Lean Shu

market, The and Gemini-II now billion the are depending on publishing to right -- We at base. market HAI targeting mid-XX [indiscernible]. is depending on is targeting [indiscernible] whole market, HAI cloud the Yes. data But a computing XXXX is growing the in anyway, not mid-XX mid-$XX like the HAI who processing okay? at the

that's it's I we think the [indiscernible] targeting. where So market market, and are

Operator

comes from Greenberg. question next Our Greg

Unknown Analyst

last years happened see X, give us on you now? in from the radiation and an Can programs? quarter for that's you update the X X, hardened Anything what

Didier Lasserre

Sure.

order quarter a prototype of a out shipped actually Europe. we this So past to customer

And going some of the further have couple that to active some still over testing. ongoing so last There are into be we years. set that's samples programs

are a others And waiting And then just Hard few production. targeting. are we're go so still to say. into that those to there

of said gross run the about for $XX we again, is XX% talked kind this And of always a rate. on north of million We've product. looking of are kind this the year kind margin that we

slower been as know, process anticipated. years still we're you've saying been it's if ever these just been It's you a ahead. much in in the So than we had that on past, just the -- calls

Unknown Analyst

up has mentioned go you space status space? in a that already I it or you And didn't quarters think What's there? maybe been up few it to ago, the in need

Didier Lasserre

to Yes, heritage. have So referring you're know, yet. yes, we don't so as far as heritage I

is prove for getting not it with in working would to It these for what we're I of associated now, be in going that in exercise space space those And to only. that would parts work not sound a a know environments. on about just little waiting program just we're way just the actually do launches. also It's heritage we we're some parts they so the be the the strange. seeing possibly to some can And -- this

environment the is done all on testing mean, I done, stimulates earth. we've that which

tests are all done tells but it folks you And work, certainly these so we that will the want actual proof.

to get So up have stamp can for and our that a on we're looking the now parts. try we so official parts heritage mechanism

Unknown Analyst

to then And back Okay. APU.

expect back? second expecting you when So still that a you're spin, would

Didier Lasserre

spinning yes, the -- yet. we're not we're actively so part So

first very are minor discussed, silicon There we at had this as some looks solid. workarounds software all They've So bugs. point.

able once we'll as we do continue to so we'll these then or any that's are determine up spin. libraries whether talked be And we bugs. And there the finish and to other algorithms done, not about,

now, So bugs. we as spin until identify other any on we're holding can off of minor any

Unknown Analyst

to read doesn't alternatives second strategic be know I have correct? partner spin a that So guys can to require far, you what into a to able so see

Didier Lasserre

the -- won't Yes. generation second more that for Correct. to need our The just also spin, correct. in part for for is business that's we strategic just partnership the expand and but general, next

Operator

Christian. Robert from comes question next Our

Robert Christian

in identified that Have technology? you companies guys any licensing are your interested possible

Didier Lasserre

or is so So are -- the working actually I'm now side, talking on about customers. if this with customer we competitors you're sure not -- not on potential right

the So it it's looking those we some their along. we've into time to bit been a conversations telecom getting ASIC. customer able looks customer further on side, are for the like is our -- incorporate do and And major that now, having technology at to a be networking IP have some of

now even the once had be get before Gemini-II. faster. Gemini-I We out progress had obviously, looking we actually of benchmarks conversations it that will we to wasn't some it's for, And the started Gemini-II and technology. that And they're

Robert Christian

that's right buying out in there, company Okay. is Good. And is as now? the there any interested it competitors other companies

Douglas Schirle

lot Well, talk things of been about a yet. but Needham nothing discussions there's and with encouraging, having to are we've

Operator

It further the that Shu now time. comments. back are turn floor there questions at appears for I would Mr. closing to no over this like to

Lee-Lean Shu

us. Thank you joining all for

to fiscal result. report speaking we when We again will look our Thank you. forward XXXX with second you quarter

Operator

today's This concludes teleconference.

your may your disconnect lines this participation. Thank You you at for time.

GSI Technology (GSIT) 25 Jul 242025 Q1 Earnings call transcript