AMPG

Good day, ladies and gentlemen, and welcome to AmpliTech Group's quarterly investor update call, where the company will discuss its second quarter 2026 financial results. Present in this call, we have the executive team of AmpliTech Group, Fawad Maqbool, CEO, CTO, and Board Chair, Jorge Flores, COO, Louisa Sanfratello, CFO. At this time, all participants are in listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. As a reminder, today's conference call is being recorded. I would now like to turn the call over to AmpliTech's COO, Jorge Flores. Please go ahead.

Thank you, operator. Thank you for joining today's call to review AmpliTech's second quarter 2026 financial results, review of our company's outlook, and to answer investor questions. Following initial management comments, we will open the call to investors' questions. An archive replay of today's call will be posted to the investors relations section of the AmpliTech's corporate website. This call is taking place on Thursday, August 13, 2026. Remarks that follow and answers to questions may include statements that the company believes to be forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally include words such as "anticipate," "believe," "expect," or words of similar importance. Likewise, statements that describe future plans, objectives, or goals are also forward-looking. These forward-looking statements are subject to various risks that could cause actual results to be materially different than expected.

Such risks include, among others, matters that the company has described in its press releases and in its filings with Securities and Exchange Commission. Except as described in these filings, the company disclaims any obligation to update forward-looking statements which are made as of today's date. With that, let me turn the call over to our CEO, Mr. Fawad Maqbool.

Thank you, Jorge. Good afternoon, everyone. Thank you everyone for joining us today. Second quarter was an important period in AmpliTech's continued transformation and growth. We recognize that investors will focus on our total revenues, gross margins, and total expenses and bottom-line results. We want to address those items directly and, more importantly, provide our investors with additional color behind the numbers. Investing ahead of growth. Our second quarter results reflect both meaningful progress across our underlying businesses and a deliberate increase in investment as we position AmpliTech to pursue and support significantly larger opportunities across 5G, telecom infrastructure, satellite communications, semiconductor technologies, and other advanced communications markets. Establishing a meaningful and sustainable position in the telecom infrastructure market is neither easy nor accomplished overnight. It requires a significant technical expertise, sustained R&D investment, product development, testing, certifications, customer qualification, and ultimately, the ability to perform at scale.

We believe the investments we have made in these areas have been instrumental in the progress AmpliTech has achieved and are an important part of building a durable, competitive position in this large and expanding market. While these investments impacted near-term profitability, we believe they should be viewed in the context of the larger opportunity we are building toward. We are encouraged by our strong revenue performance and equally important, by the continued commercial and technical progress we are making in markets that historically have presented substantial barriers to entry and were only for the industry giants. There are no shortcuts to building a lasting presence in the telecom infrastructure. Our strategy has been to invest in the technology deliberately, people, the capabilities, and customer relationships necessary to compete for increasingly meaningful opportunities and to support them successfully as they scale.

We remain focused on disciplined execution, converting our technology investments into commercial opportunities, expanding our customer base, scaling the revenue responsibly, and improving operating leverage as the business grows. Our long-term objective is to build AmpliTech into a significantly larger and more valuable communications technology company, and in doing so, create substantial and sustainable value for our shareholders. This doesn't happen overnight, and it takes a lot of resources to put all of this together to compete with the giants that we are in. Q2 was, in many respects, a quarter to invest in the future growth of AmpliTech Group. We invested in customer-driven R&D, customer-driven supply chain resilience, production readiness, strategic sales and marketing, specialized personnel and outside expertise, cybersecurity and IT infrastructure, internal controls, and the organizational capabilities required to support larger customers. Building the commercial organization.

We also increased our investment in sales and marketing during the quarter. The 10-Q reflects increased marketing and business development activity, including additional industry trade shows, expanded promotional initiatives, and hiring of two senior business development representatives to support the company's expanding 5G Open RAN commercial strategy and our 5G product portfolio. To establish our brand and position us for growth, we've engaged a strategic marketing and communications firm also, whose principals have deep experience in complex industries. They're building our marketing and communications foundation from the ground up. They've already overhauled our website and messaging, and they'll be assisting us with sales campaigns, rebuilding the e-commerce parts of our site, strengthening our SEO, and building the brand equity that positions us as a leader in the market. We recognize these as essential ingredients, especially the website, to portray an image that we really need to show our investors.

Historically, AmpliTech has been a highly engineering-driven organization. As our product portfolio and addressable markets expand, we believe we must put an equally capable commercial organization around the technology we have developed. The objective is not simply greater marketing exposure. It's to improve access to strategic accounts and convert technology validation, customer engagement, and engineering activity into commercial opportunities. We believe that next stage of AmpliTech's evolution requires both technology leadership and market access. With this, I'll turn the call over to our CFO, Louisa Sanfratello, to review our financial results in more detail.

Thank you, Fawad. Good afternoon, everyone. Second quarter revenue was approximately $8.1 million, compared with approximately $5.35 million in the first quarter, representing sequential revenue growth of approximately 51%. Although revenue declined year-over-year when comparing second quarter results, the comparison requires important context. The prior year quarter included acquired 5G product sales associated with the Titan asset acquisition. Those sales increased reported revenue but carried significantly lower gross margins. The difference can clearly be seen in our gross profits performance. When comparing gross margins from Q2 2025 and Q2 2026, this year's second quarter gross profit increased from approximately $863,000 to $2.25 million, an increase of approximately 161%. Gross margin increased from approximately 7.8% in Q2 2025 to 27.9% in Q2 2026.

For the first six months of 2026, gross profit increased approximately 135%, from $2.05 million to $4.82 million, while gross margin increased from approximately 14%-35.9%. The 10-Q attributes this improvement primarily to a more favorable product mix and the absence of the lower margin acquired 5G product sales included in the comparable prior year period. Sequentially, gross margin decreased from approximately 48% in Q1 to approximately 28% in Q2. We believe investors should consider this in the context of quarterly product mix and our current stage of commercialization. At our present scale, individual customer programs and product mix can have a significant effect on quarterly margins. More importantly, as we prepare to support larger customers, we are incurring costs associated with production readiness, supply chain capability, product development, and customer-specific requirements ahead of the full revenue contribution we are seeking from those programs.

Our longer-term objective remains to increase the contribution from our differentiated internally developed technologies and higher-margin product offerings as those programs progress toward commercialization. In line with what our CEO just shared, our SG&A expenses increased to approximately $4.08 million in Q2 2026, compared with approximately $2.13 million in Q2 2025. This increase relates primarily to higher parent company expenses, including amortization, legal fees, and stock-based compensation, together with greater investment in marketing and business development, additional trade show participation, and expanded consulting resources supporting the company's 5G portfolio. There is additional strategic context that we believe is important for shareholders. As we engage with larger MNOs, the telecommunication infrastructure providers and enterprise customers, their expectations extend well beyond the product performance. These organizations increasingly expect suppliers to demonstrate strong internal controls, cybersecurity practices, IT governance, operational resilience, and the infrastructure necessary to support larger deployments.

Accordingly, we have engaged specialized consulting resources to further strengthen our SOX-related controls and protocols, cybersecurity framework, and ISO-aligned IT security practices. We are also transitioning toward a hybrid IT infrastructure model, combining appropriate internal resources with specialized external expertise. Our objective is to improve security, redundancy, scalability, and technical support as the company grows. These initiatives are also relevant to enhance written documentation of internal controls and procedures, information technology, general controls, and personnel resources necessary for appropriate segregation of duties. We therefore view these required investments as critical, both from a corporate governance standpoint and from a customer readiness standpoint. We expect operating expenses to grow more efficiently than revenue going forward. Certain elevated expenditures were associated with implementation, consulting, customer development, commercialization, and infrastructure initiatives undertaken as we prepare the company for a larger scale of operations. Some ongoing investment will clearly remain necessary.

We intend to continue investing where management sees an appropriate potential return. However, our objective is to build the infrastructure now and leverage that infrastructure across a substantially larger revenue base. That is where we believe future operating leverage can ultimately come from. Second quarter R&D increased to approximately $1.37 million, compared with approximately $659,000 in Q2 of 2025. Of Q2 R&D, approximately $1.08 million related to 5G development and approximately $297,000 related to MMIC design. As stated on our 10-Q, this increase is primarily due to the expanded 5G product development activity, including higher prototype and testing costs, and increased consulting expenses supporting product innovation and development. From an operational standpoint, this quarter also required increased engineering support for new and customized requirements from existing and prospective customers. This is an important distinction.

As our engagement with larger customers increases, those customers may require specific configurations, prototypes, testing, validation, and technical modifications before programs can progress toward commercial deployment. That means the company can incur engineering and development expenses before the associated production revenue is recognized. We view much of this work as supporting commercialization opportunities rather than research conducted without an identified market application. We are investing engineering resources today with the objective of creating products and configurations capable of generating future commercial revenue. The combination of these investments resulted in a second quarter operating loss of approximately $3.2 million and a net loss of approximately $3.09 million. We recognize that these numbers are important to shareholders, and we are not minimizing them. However, we believe it is equally important to understand what contributed to the increase.

During Q2, AmpliTech simultaneously invested in product development, customer-specific engineering, sales and marketing, supply chain readiness, production capability, cybersecurity, IT infrastructure, corporate controls, and the broader organizational infrastructure required to support larger customers. Our focus now is on converting those investments into commercial revenue and ultimately operating leverage. With that said, our balance sheet provides us with significantly greater capacity to execute this strategy. At June 30th, AmpliTech reported approximately $13 million in cash and cash equivalents and marketable securities, accounts receivable at approximately $6.3 million, and approximately $31.25 million in current assets, representing approximately $22.9 million of working capital. Total liabilities decreased to approximately $11.75 million from approximately $18.62 million at December 31st, while stockholders' equity increased to approximately $46.75 million.

Not included in our Q2 results, as this transaction occurred following our quarter end, the exercise of the company's Series A rights in July 2026 generated approximately $21.92 million in gross proceeds and $20.12 million in net proceeds. We believe the rationale for strengthening our capital position should also be viewed strategically. Large MNOs and telecommunication infrastructure providers need confidence that their suppliers have the financial resources, manufacturing capability, inventory availability, engineering support, and supply chain resilience necessary to execute significant programs. For AmpliTech, a stronger balance sheet is therefore not simply a financial asset. It is also a commercial capability. It provides greater flexibility to support working capital requirements, secure production capacity, strengthen the supply chain, support customer qualification and testing, and pursue larger opportunities without placing undue pressure on day-to-day liquidity. We believe that is particularly important as the scale of the customers and opportunities we pursue increases.

I'll now turn the call over to our COO.

Thank you, Louisa. I'd like to comment from the operational perspective. From an operating perspective, Q2 was about preparing AmpliTech for a different level of customer engagement. As our opportunities expand within 5G and telecommunications infrastructure, customer requirements became more demanding. Major telecommunication customers evaluate much more than product performance and price. They do evaluations on engineering capability, customization ability, quality, manufacturing readiness, supply chain reliability, cybersecurity IT systems, financial stability, testing capability, delivery performance, and ongoing technical support. Our investments during Q2 were designed to strengthen these capabilities. Supply chain resilience is particularly important. At June 30th, long-term deposits totaled approximately $3.08 million, including approximately $2.47 million associated with dedicated production capacity. During the first six months of 2026, we made an additional $1.3 million of advanced payments towards this dedicated production line. We believe these investments are important and critical as we pursue larger opportunities.

The goal is to ensure that as a customer demand scales, we have access to the capacity and resources required to support that demand. For a growing technology company pursuing much larger customers, we believe preparation must occur before the volume arrives. We do not want to secure a significant commercial opportunity and then discover that our production capacity, supply chain, or supporting infrastructure cannot meet the customer deployment requirements. The same principle applies to engineering. During Q2, our team supported increased product development, prototype, and testing activity. The 10-Q reflects the resulting increase in 5G R&D. In addition, existing and prospective customers are requesting custom configurations and technical requirements for their specific applications. Supporting these opportunities requires engineering investment before production revenue is necessarily recognized. There is therefore an inherent timing difference between development expenditure and potential commercialization.

Our objective is to use our core technology platforms to address customer-specific requirements while developing solutions that can transition into production programs. That is why we view much of the increased engineering activity as an investment supporting potential new business. We are also making a deliberate investment in our commercial organization. As our CEO previously mentioned, to establish our brand and position us for growth, we have engaged a strategic marketing and communications firm whose principals have deep experience in complex industries. They are building our marketing and communications foundations from the ground up. They have, as Fawad mentioned, already overhauled our website and messaging, and they will be assisting us with sales campaigns, rebuilding the e-commerce portion of our site, strengthening our SEO, and building the brand equity that positions us as a leader in our market.

Combined with our internal business development efforts and increased presence at important industry events, the objective is to improve our ability to engage with the strategic customers across the markets we serve. Our second quarter reflects increased marketing and business development activity, which includes our participation in critical trade shows and conferences like IMS, the Mobile World Congress in Barcelona, Spain, and Connect (X) in Florida, U.S.A. during the first half, and the engagement of consultants supporting the company's 5G portfolio. We believe the technology foundation is increasingly in place. The next objective is to ensure that the market understands what AmpliTech can provide and that we have the commercial resources necessary to turn technical engagement into customer relationships and commercial programs. We have also been strengthening an area that may be less visible externally, but it is increasingly important to major customers, cybersecurity and IT infrastructure.

As we pursue larger MNOs, telecom infrastructure providers, and other global customers, we believe robust security and IT governance become increasingly important parts of the supplier qualification and ongoing customer support. We have therefore engaged specialized consultants to strengthen our cybersecurity environment and further develop SOX-related protocols and controls and ISO-aligned IT security practices. As Louisa mentioned, we are also transitioning towards a hybrid IT platform, which is more or less intended to combine our internal oversight with specialized external IT capabilities to provide greater security, redundancy, scalability, monitoring, and support. For us, this is part of the same broad strategy as strengthening our production and supply chain capabilities. We are simply building the infrastructure behind the product. These include the physical supply chain, engineering resources, commercial organization, cybersecurity environments, IT systems, financial control and most importantly as well, customer support capabilities which are ever-present with larger MNOs.

We believe all of these elements become increasingly important as the size and sophistication of our customers increase. Larger programs require larger preparation from our part. With this, I would like to transfer back to our CEO, Mr. Fawad Maqbool.

Thank you, Jorge. I would like to follow up with our strategic perspective and outlook. When we say Q2 was an investment quarter, we are not using that phrase simply to explain higher expenses. There was a deliberate strategy behind those expenditures. We invested ahead of the revenue opportunities we are pursuing. We invested in customer-driven R&D. We invested in production readiness and supply chain resilience. We invested in sales, marketing, and global business development. We invested in strategic talent and specialized outside expertise. We invested in cybersecurity, IT infrastructure, and internal controls, and we strengthened our balance sheet so that we can support opportunities of a greater scale. These investments increased our near-term operating expenses, near-term, but they were made with a clear objective to position AmpliTech to support larger programs, larger customers, and ultimately a greater contribution from differentiated higher-margin products.

Every time we go to a customer and we say, "Okay, where's the PO?" After we demonstrated something, they keep adding something else. We have to keep adding all those things that you saw that we mentioned in order to properly serve and get more business from these customers. Looking at the margin perspective, we also want to emphasize the importance of revenue quality. Although the first half of 2026 revenue was approximately 8% below the comparable prior year period, gross profit increased approximately 135%, and gross margin improved from approximately 14% to approximately 36%. This is demonstrating the impact of product mix on the business. It's very important. We have many different products, and each one of them carries its own profitability. Our objective is not simply to maximize the revenue without regard to profitability.

We're focused on increasing the contribution from differentiated technologies and products where AmpliTech's engineering, intellectual property, and performance provide meaningful value to the customer. All the different divisions have a purpose for supporting the customer in every different way. As those products and customer programs move further towards commercialization, we expect the opportunity for a more favorable mix of a higher margin revenue. This is the beginning. It's like priming the engine with gas. This is what we have to do to set up the engine so we can get to speed. We should also be clear that quarterly margins can fluctuate based on product mix, customer mix, timing, and stage of individual programs. But strategically, the direction we are pursuing is clear. From the investment to the operating leverage, the next stage is about converting investment into results.

Much of the infrastructure we are establishing today is intended to support a significantly larger revenue base around the corner. We do not expect every dollar of the revenue growth to require a corresponding dollar increase in corporate infrastructure. We've been investing ahead of the anticipated demand so that when larger opportunities progress, the company has the ability to support them. That's how we intend to create operating leverage over time. Our priorities remain for the remainder of 2026. One, convert customer engagement and develop programs into commercial orders and production revenue. Two, increase the contribution from differentiated higher-margin products. Three, leverage our expanded sales and marketing capabilities to broaden our customer base and global footprint. Four, continue strengthening production and supply chain readiness for larger deployments. Five, complete key customer-driven engineering and customization programs.

Six, strengthen cybersecurity, IT systems, and internal controls appropriate for the larger customers we are pushing. The larger customers ask for all kinds of questionnaires that we have to demonstrate that we have all the systems and protocols in place to support them. It's become very important now, the cybersecurity, so we have to expand accordingly to make sure we support them. Number seven, finally, maintain disciplined capital allocation as these opportunities progress. My closing remarks. AmpliTech today is building a substantially broader organization than it was several years ago. That can be seen. Everything is growing. Yes, including our expenses, but it's for a greater good. We have expanded beyond our traditional RF component business into semiconductor distribution, MMIC development, advanced RF solutions, and 5G infrastructure. This gives us independence from individual vendors. It gives us our own IP and technology.

This makes us more of a one-stop solution for our customers rather than them going 10 different places. That's the attractive part, but we have to build that. We have to show them that. That transformation requires investment. We believe we are now building not simply individual products, but the technology, operational and commercial platform necessary to participate in these significantly larger markets. They are trillion-dollar markets, multi-billion dollar markets in everything that we're doing. The second quarter reflected that transition. Revenue increased approximately 51% sequentially. Our first half gross profit increased approximately 135% year-over-year. We strengthened our production and supply chain capabilities. We increased customer-driven R&D. This is something that our customers have asked. What does that mean? If they don't have any interest, they wouldn't ask us to do the R&D, and we wouldn't spend it.

We expanded our sales and marketing research and reach. We are strengthening our cybersecurity, again, IT infrastructure, and corporate controls. Following the Series A rights exercise, we substantially strengthened our financial resources. This is the reason why we did that. We need to do all these things, and without the capital investment, we cannot do that. We cannot compete. Q2 was an investment quarter. It should be noted as such. Our focus now is on converting those investments into sustainable growth, higher margin commercial revenue, and over time, improved operating leverage. We believe we have strengthened the foundation necessary to support larger customers and opportunities we are pursuing, as we have mentioned in many calls before and many PRs. We appreciate the continued support of our shareholders, customers, employees, and strategic partners. We look forward to updating you on our progress not far away in the near future.

Now I'd like to go back to Jorge, AmpliTech Group's COO, to address previously received questions into our email.

Thank you, Fawad. I would like to immediately address the questions received so far at our [email protected] email address. The first question came in as, "Revenue increased substantially from Q1, but gross margin declined. Why?" The primary factor is product mix. At our current scale, the timing and composition of individual customer orders can materially affect quarterly margins. What we believe is important is the broader trend. For the first six months of 2026, gross margin was approximately 35.9%, compared with approximately 14% in the first half of 2025, while gross profit increased approximately 135%. Our objective is to increase the contribution from differentiated products and technologies as newer programs progress towards commercialization. We, therefore, will not view any individual quarter's margin as necessarily representative of the longer-term mix we are working towards.

Next question: "Why did operating expenses increase so much?" Well, as we basically mentioned during this conference call, during Q2, we incurred increased amortization, legal fees, and stock-based compensation, as well as greater marketing and business development activity, additional trade shows participations, and consultants supporting our 5G portfolio. R&D also increased because of higher 5G development, prototype testing, and consulting activity. In addition, we have been investing in infrastructure that we believe is necessary to support larger customers, including customer-specific engineering, cybersecurity, IT systems, internal control, supply chain readiness, and commercial capabilities. We don't believe investors should assume that these elevated expenditures will necessarily increase proportionately with revenue. Some costs are ongoing, while others are associated with implementation, customer development, or building capabilities that we expect to leverage over a larger future revenue base.

In other words, the next question is, "Are you saying these expenses are non-recurring?" Well, we will not characterize all of them as non-recurring. A more accurate way to describe the quarter is that certain expenses were elevated because of specific implementation, development, consulting, and commercialization initiatives. We will continue investing where we believe there is an appropriate potential return. The objective is to increase revenues at a faster rate than expenses. That's the objective of every business. We're building capabilities today that we expect to leverage as the business scales. Next question: "Why was it necessary to raise additional capital?" We believe financial strength is increasingly important when dealing with much larger customers. Large MNOs and telecommunications infrastructure providers need confidence that their suppliers can support production, can buy inventory, supply chain requirements, engineering, and customer support at scale.

Following the Series A rights exercise, we received approximately $20 million in net proceeds, significantly strengthening our financial flexibility. We view the liquidity not simply as cash on the balance sheet, but as part of our ability to support larger commercial opportunities. Next question: "When should investors expect these investments to translate into revenue?" Our focus is on converting the customer engagement, engineering programs, and commercial activity already underway into production opportunities. The timing of large telecommunications programs can depend on customer testing, qualification, network requirements, purchasing decisions, and deployment schedules, many of which are just simply outside our control. For that reason, we do not want to provide timing beyond what we have formally disclosed. What we can say is that we have intentionally strengthened our engineering, supply chain, commercial, and financial capabilities so that as opportunities progress, AmpliTech is positioned to support them.

This concludes the questions previously received up to this hour into our email address. Operator, please open the lines for questions.

We will now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing any keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. The first question comes from Jack Vander Aarde with Maxim Group. Please go ahead.

Okay, great. Good evening. Thanks for taking my questions. Fawad, I guess my first question is on the 2Q results, total revenue of $8 million. I was digging through the 10-Q here, and at the segment level, I was surprised to see more than 1/2 or about just over $4 million was actually from the Spectrum division. It also seems that Spectrum's gross margin seemed relatively stable in the mid 40%. Was this expected? It seems that the drop-off in gross margin was from the Engineering Services in the AmpliTech segment. Just trying to understand why that is and if that is the case going forward.

Yes, you are correct in that observation, Jack. How are you doing? Jorge, do you want to answer that?

Yes, that is correct. Certainly, though, we are very pleased that our Spectrum division is doing a lot better this year. We are seeing up demand from their side. This is a pleasant surprise. We are finally seeing that they are receiving a lot of inquiries, and we are also developing new ways of revenue for our Spectrum division. This quarter was a good testimony of what we have been doing with them while maintaining the growth margins that we are already accustomed from them.

Okay, thanks, Jorge.

Jack.

Yep.

Let me add to that, Jack. Jack, the difference, Spectrum is a distribution company. They are distributing standard parts. They do not do any engineering. Our company, the rest of the divisions are engineering-focused. They have to basically do R&D almost all the time to keep up with all the requirements and meet all the requirements of our customers, especially in a newly developing business. There is a significant contrast between the kind of business that Spectrum does, which is stable, that is why we acquired them many years ago. Stable with a net profit margin, and it will be scaled up as our 5G business grows as well because they are going to be receiving our packages for distribution and our certain products for distribution also. There is a significant difference between their business model and our business model, but that is why it is there, to give a balance and diversity.

Understood. I guess my next follow-up question to that, though, is if I look at 2Q last year, the Engineering Services segment gross margin, I think, was actually quite high. I think it was, unless this math is wrong, it was actually closer to 90% in the second quarter of last year. Sort of a 22% in Q1. Just maybe it is just product mix and then also different types of products that you have been investing in, obviously in that segment. But does that seem accurate to you? The gross margin difference in the AmpliTech Engineering segment?

Well, the AmpliTech Engineering segment includes the LNA business as well as the 5G, no, the LNB business as well. The 5G division is a little bit separate. If you take the 5G division separately, you will see that the gross margins, as we said before, are lower, but our revenues are getting higher. But that, since we are a group, it impacts the profitability of the other divisions. Overall, it looks lower. But in general, the idea is the product mix. This is what differentiates everything. That will change. As we go and build more and more business, this mix will keep changing, but it will be more towards the profitability side, because right now we are just setting up a larger business that will eclipse almost all the other divisions.

Okay. Understood. Next question just on your outlook for the rest of this year. It is good to see the $6 million purchase orders come in during the month of July alone. Last quarter, I think you reiterated a revenue guidance for $50 million for the year that was assumed to be low visibility, back half loaded. Obviously, you have this very large LOI with another reseller here. Can you maybe just touch on that? Is there a reaffirmed guidance? Are we withdrawn from the guidance based on visibility at this point? Just trying to understand the interim change.

Jorge, you want to handle it?

Yeah. Jack, this is Jorge. So basically, when we established our 2026 outlook, it was based on customer deployment schedules. We had backlogs on hand as well. Also, though, we tied in some expected conversion of our LOI programs into funded purchase orders that we had visibility at that time. Right. So over these first six months, we have seen or experienced a shift in the timing of certain anticipated volume shipments. Volume shipments, right? Particularly within one of our international 5G programs. So this shift is affecting the timing on the follow-on purchase orders associated with that deployment overseas. So importantly, what we are seeing is primarily a timing issue rather than a change in the underlying customer opportunity. So the programs remain definitely very active. We see continued and meaningful commercial activity.

As we mentioned in here though before, though, we just received $6 million in follow-on orders in July alone. So we are still definitely expecting meaningful year-over-year revenue growth in 2026 and a stronger second half of the year. However, though, given the customer-controlled timing associated with these larger deployments, we believe it is prudent at this point not to reaffirm a specific full-year revenue number today until we have better visibility into the timing of these volume shipments and follow-on orders. Again, our focus remains on converting these opportunities in front of us into funded orders, shipping those orders efficiently, and building the business for sustainable growth beyond any individual quarter.

Okay, understood. That makes sense. Maybe just one more for me then. Fawad, can you just confirm, is that LOI that was, I think it was $76 million at the time with that reseller, that LOI is still active, I believe. Is there any incremental testing or certification that they are asking you for before we see orders start to roll in?

Yes, it is still active. It is still active, and again, since these individual countries, Jorge just mentioned the same thing. It is basically timing related. Everything is still active. It is just the fact that adoption of this technology, final testing is all done. We were going through the final testing, and now what happens is the adoption has to take place and the larger orders have to come through. We were getting smaller orders which we had delivered already, and they were already deployed, and they are testing that whole thing. These Asian countries, they have a lot of bureaucracy, if I can use that word.

Yep.

There is a lot of things that are a hindrance to closing something. That is the only thing we are facing right now. The technology has been proven. We have good IP, and that IP can be deployed in other countries and other areas as well, which you will be seeing in the coming months as we will be announcing.

Okay, great. I said that was my last question. Maybe just one more, Fawad. Can you just touch on your business development activities recently in terms of opening up new potential LOIs or partners, just customers in general? Since we have seen these two large LOIs that you entered originally in the first half of 2025, is there anything else on the horizon here that maybe you can-

Yeah

You could touch on or Go ahead.

Yes. First of all, the LOIs were, again, because we want to show that we are in touch and engaged with these customers and they are willing to work with us, so we get LOIs from them, right? But at this stage right now, because of the development of our infrastructure, our customers are feeling more secure with us. We have already exceeded the original LOIs for the original $40 million LOI that we had before. We have exceeded that from the same customer. We have gotten more orders than the LOI, and the deliveries are just being rolled out now. The technology that we have, it took us a while to get that fully transferred. Now that IP is in our hands, and so now that will be converted into revenue streams as well in the coming months towards the end of this year.

The customers are now going to go straight towards POs. We are not going to go through any more LOI type of engagement because we have insisted to customers, new customers, not the same ones. In some cases, the same ones are going to renew their orders and give us larger orders, which we will be announcing in next month or so. But newer customers, other customers who are also going to be interested in our technology, which is very unique. This IP expense that we have spent so much on, the R&D that we have spent so much on, it is for the reason that it is more common for being deployed by many in multiple MNOs rather than just one right now. All right? That is the whole idea. The whole idea is that IP now becomes unique and nobody else has that, no other vendor has that.

We are able to supply all these MNOs with similar technology that has been proven in the field. We are getting very close to that time where we are just going to get the POs and we will be announcing them. The business development that we have put in place with the two new people that we hired is specifically strategic hires. They have positions in the companies that they work for, and they have expertise in conveying what our technology means to them. That will show also, that will be shown in the coming months as well, the results of that.

Okay, great. No, that sounds very encouraging. I appreciate the time. I will hop back in the queue. Thanks.

Thank you for the question, Jack.

The next question comes from Palmer Fortune, private investor. Please go ahead.

Hello, everyone. How is everyone doing?

Good. How are you?

Thank you. I'm doing great. Thank you. Thank you for taking my call. I'm a small investor compared to most everybody probably on this call. Mr. Fawad, I, of course, have never spoken to you, but the inability to answer the question to the previously announced $50 million yearly guidance, I didn't hear anyone on your team or in AmpliTech Group confirm that guidance. It seemed to me like you all walked around that. Did I mishear something, or can you expand on that?

No, you didn't mishear anything. We explained that it's a timing issue, and we don't have the foresight to give you any number or anything specific supporting that right now. Everything is in place.

Is that— I'm sorry.

The timing has changed. The timing is the difference there right now.

I understand. When you say everything is in place, does that mean customers are in place?

We do not have any cancellations of orders, or we do not have any changes in the LOIs. The forecast timing has changed, but everything else is still in place, so we cannot say yes or no exactly this is what is going to happen.

I could read into your answer of you saying that $50 million could happen before the end of the year?

It could.

Okay. All right. Well, thank you for your time. I am in a large AmpliTech Group investment community, and everyone in our, we have been anticipating this earnings, but the lack of guidance has really been an issue in our group chat. I really wanted to just ask you directly, and if I was rude in doing so, I apologize.

It is no problem. I do not know if it is the lack of guidance, Palmer. Is it specifically to this subject that you are talking about or everything else in general?

I think guidance is very important because I am an investor in AmpliTech Group. I am not a trader.

Initial guidance in Q1 was $50 million revenue for 2026. You were asked by the Maxim reporter that direct question, if you could still confirm that AmpliTech Group's guidance for fiscal year 2026 was still on pace for $50 million. No one answered that question directly with a yes or a no, and that just drew some red flags to me as an investor in your company.

Well, but when it comes to that, Mr. Palmer, this is Jorge. It is that-

Yes, sir.

We cannot tell you 100% that we are going to hit it or we are not going to hit it, right? Because we have seen, and we are seeing a shift in our customers' deployment plans. So at this point in time, we see that we are lagging behind the projected deployment schedule. We are talking about 5G radios, in which they have to schedule tower cell implementation. They have to send the staff out there to climb the towers, remove whatever technologies they are removing, and then putting ours in. Then as they consume their inventory, then they place follow-on orders. So while we are not reaffirming this $50 million figure today, we continue to expect significant growth for the year on our cells.

But right now, we just believe it would be premature to replace any prior outlook with another specific number until we have greater visibility into the timing of these volume deployments. That is the case here. We do not want to mislead anybody, and we just want to show here that we are prepared. We are doing the necessary and taking the necessary steps, not just to fulfill the orders that we currently have, but also to support new large opportunities that we have with new customers, in which we are spending a lot of engineering resources, and we are spending a lot of business development hours. We do have larger opportunities also that are going to start contributing to the revenue number yet.

However, we are not able to publish or comment on who we are dealing with right now because we are subject to NDAs. We need to be very careful because we are also very jealous on not sharing to our competitors who we are working with because we do not want them to also impede the progress on our negotiations with our current customers. We also can reaffirm that no orders that we have in our backlog have been canceled. Absolutely not. It is just a timing on deployment, the speed on the deployments. I want to make sure that everybody understands here, not just you, but everybody else that is listening to this call.

Jorge, thank you so much for your transparency. This is the first micro-cap company that I have invested in, and the two things that drew me to AmpliTech was, A, the technology that you all have, and B, the management. I think most everyone I am involved with with AmpliTech Group, those are the two reasons why they are investors also. Your transparency right there, I really appreciate that. My concern is not with the delay. I am totally fine with delays. I still believe in AmpliTech's thesis. My only concern was I was not asking for a firm guidance. It is just guidance. We are guiding you that we see this on the horizon, and I understand that you want to be conservative, and I appreciate that. I just think a lot of us

Right

are missing the guidance. We are not trying to stick a number on the wall to raise a stock price. But a thorough, honest guidance, I think is what has been missing, at least on my end from this call. If I missed it because I am not as smart as you all, then that is on me. But I really, really appreciate your time taking my call, and I will get off because I am sure you have other people that would like to ask questions, too. Is that all right with you gentlemen?

Yeah. Thank you, Palmer.

Absolutely.

Appreciate it.

No, thank you. Have a good evening.

Take care. You, too.

The next question comes from Lennox Brooks with Fort Washington Investment. Please go ahead.

Hey, team. Congrats on the progress and on the quarter.

Thank you, Lennox.

Thank you.

One question from me. Can you provide any color on your inquiries or engagements from customers related to quantum computing? Has it increased over the past year?

Yeah, Lennox. Quantum computing seems to be a very static business right now. If you look at the companies that are involved, the quantum computing adoption has been slow. AI is very quick, right? AI is artificial intelligence and all that. My belief and my thinking is that the AI has to progress into quantum computing because as you get more and more AI heavy into everything, two things have to change. One, the mode of wireless communications. Every piece of data has to go wirelessly somewhere at a very high speed. That is number one, and that is why we are into this 5G infrastructure and making it the fastest and most higher capacity there is. That differentiates us. We are also in the low noise area, right? The low noise arena. We have the lowest noise figures in the world, which leads us into the quantum computing.

Right now, IBM and companies like IBM, D-Wave, and Rigetti and all those companies, they have not found a terrific application that will join the AI to the quantum computing. Because right now it is not a productionized market, let us say. One quantum computer would serve thousands of businesses. It is a B2B. It is not like you and I can get onto a quantum computer and try to start working, right? Not like a PC. That is why the production phase has not been there, and it likely may not be until AI sees the need to now use quantum computing to do all its functionality. Right now, we are building huge data centers and everything. So our belief is that the production phase of that has not really begun.

It is really still into a smaller quantity applications because each supercomputer that these companies have, and some of these companies, by the way, like D-Wave and all these other companies, they do not really have any real product. IBM has a quantum computer, but again, I do not want to get into details, but they are not productionizing it. You are not going to sell thousands and thousands of quantum computers. We have sold into the core computing systems just for R&D and development work. We are the only U.S. company that has these LNAs capable of operating at 4 Kelvin. But it has not become productionized, so it is kind of static right now. We do not see that tremendous growth in the quantum component area.

That all totally makes sense, though. Yes, it does. I appreciate it.

Okay, great.

The next question comes from Richard Kreger with Moody Capital Solutions. Please go ahead.

Hello. Congratulations on a record revenue quarter. Quick question for you. Noticed that the gross margin of the business is up significantly year-over-year. It looks like first half gross margins went from about 14% to almost 36% for the first half year-over-year, and curious how you expect with revenue growth, gross margins may be impacted for the second half of the year. Should we expect a similar improvement year-over-year in both revenue and gross margins? Also curious about Q1 versus Q2. We saw a dip quarter-over-quarter, but the big growth year-over-year. It seems a bit choppy there.

Yeah, Rich. Thanks for the question. Well, of course, we have explained that this gross margin and the revenue is lumpy right now quarter to quarter because of the product mix that we're working on. We also want to make sure everybody understands that our focus is in building up the 5G product lines, and we're investing heavily in that. That's the reason for all these expenses. As we go forward in the second half of the year, we expect to have orders that have higher margins that we have been looking for for the last two or three years of building the company, so that we can structure a company that can support these large orders. Every time we go to these large companies, they keep asking us, "Do you have this?

Do you have that?" All the things that you're seeing now comes from the need to have all these things. Otherwise, we don't get an order, right? The company's a billion-dollar companies. Do you think they're going to give us an order because they like us? They don't do that unless they see a strong balance sheet. They see that we can support all their requirements for program management and all the other things that are tremendous requirements in this kind of business. So yes, we do see that the second half of the year will have good bookings and good orders, higher margin orders, and that will help us to take the lumpiness out and smooth out the curve of growth.

If I can ask one more question. Obviously, been following the company for a long time. We're very familiar with the Open RAN story and the growth you're experiencing with Open RAN technologies. But noticed that recently you joined the AI RAN Alliance. Can you talk a little bit about who's involved with the AI RAN Alliance and what was the purpose or reason behind joining the AI RAN Alliance?

Yes. So there are different alliances. We're also part of the O-RAN ALLIANCE, by the way. I think everybody knows that. We received certifications from there. Our radios were certified from them, and they're the ones making the standards for O-RAN adoption, right? Similarly, the AI RAN Alliance is an organization that has all the major telecoms, all the major big names you can think of, AT&T, Verizon, NVIDIA. You name it, they're in this alliance, right? The reason is that along with the adoption of the hardware interface as well, software, now they want to make sure that everything that we build is going to have some layer of AI interoperability. Because AI is what speeds things up, right? It makes things more accessible, and the radios will become more accessible if they have a uniform AI RAN layer.

We have already, let's say, leapfrogged many of our competitors by being part of this alliance that allows us to share information openly, as well as be able to give them hardware that they can test and put their AI RAN into the hardware and then make it work and show the world that it's doable. That's a big step for us because it puts our technology in front of all the major players to see. For that reason, it kind of singles us out. We're the only ones that have radios that are AI RAN-enabled. In addition to the fact that we are O-RAN certified, we also have AI RAN accessibility to all the major players and major MNOs, with major software providers like NVIDIA as well as DeepSig and all these other guys.

The universities are using our radios to demonstrate this capability, so our platform becomes more and more powerful.

Do you mind if I ask one more question about the AI RAN Alliance?

Sure.

I saw a press release that was released by Northeastern University that mentioned both AmpliTech Group as well as NVIDIA in its press release. But I didn't see any press releases from AmpliTech discussing that certification or what the relationship is with NVIDIA. Do you mind perhaps elaborating and explaining why you did not mention NVIDIA in any of the press releases about the Northeastern certification? Thank you.

Well, we work with NVIDIA as a partner in the ecosystem that Northeastern University is putting together, right? They need hardware, and there's so many more elements that put together an AI RAN-capable radio or hardware or network to go even further. Since we don't have any direct communication or direct product placement with NVIDIA itself, we can't really mention them, right? But NVIDIA is using our radios, and their aerial layer, as mentioned in the article, is in our radios, and we're the only radio they have. We cannot directly mention NVIDIA specifically because we're not doing anything contractually with them.

Okay, thank you. No further questions.

No problem. You're welcome.

The next question comes from Andrew DeAngelis with Venture Capital. Please go ahead.

Hey. Thanks for taking my questions, guys. I know this has been a long call. I just was hoping to get some additional context on the 8-K that you guys released yesterday night in regards to the Titan Acquisition amendment, both how that is impacted the first half of the year and any continuing impact into the back half as it relates to that.

Yes. There is going to be a press release tomorrow addressing that 8-K. But in summary, we basically have just negotiated penalties or damages for late delivery of those parts. That really just means that we have been delayed in rolling out our IP, which we have re-engineered as well, so that it is more feasible for all our customers, and it is in big demand right now actually. That is really just a delay. Now that we are almost 99% complete in all the asset transfer that we have done, and we have embellished it with our own technology, we are now ready to roll out to the customers these productionized versions, which are going to appear to start shipping. We already have orders for these, by the way. These are going to start shipping towards the end of the year or early next year.

There will be a press release out tomorrow detailing this.

Okay. Helpful. Just real quickly, are you able to disclose your fully diluted share count as of the end of July, post the Series A?

I don't think end of July we can do that, Louisa?

If you would like, Andrew, you could send me an email and I could disclose that information if I am able to. I would have to check with legal, because if I disclose it to you, I would have to disclose it to the rest of the other shareholders.

Understood.

Yeah. July would be outside the June 30th quarter, right? So we can only disclose information up to June 30.

Yeah. The only reason I am asking is just to have that current number with the Series A. Understood that may not be disclosable. If I could just squeeze in really one more, just around as you think about the cost related to the infrastructure that you are building out and the run rate of costs that are kind of ongoing versus more one-time in nature, how are you guys thinking about recurring SG&A run rate, and if you are able to kind of break out maybe the size of one-time expenditures on that line and just maybe overall?

If you look at SG&A and gross margins, they are connected in the fact with revenues, right? If we have higher revenues and increased revenues, and we keep our expenses close to what it is right now or a little bit higher, then you see that you basically have a lower and lower SG&A because your revenues are much higher and your gross margin is higher. When we reach $50 million, $100 million or so, whatever the revenues are, which is our goal, right, more than that, then you will see the drop in SG&A. This is only because we have a fixed expense right now, which is increasing, but the revenues have not accordingly caught up to it. But as soon as the revenues start catching up to it, you will see that drop.

Thank you. Thank you all. Have a great evening.

You are welcome. Thank you.

This concludes the question and answer session. I would like to turn the conference back over to Fawad Maqbool for any closing remarks. Please go ahead.

Thank you, operator, and thanks to everyone who joined today's call to hear about the progress we've made and the plan we have to further our company's mission of providing the communication systems of tomorrow, today. We look forward to updating you further in our third quarter financial results call sometime in November. Until then, please contact us directly should you have any questions or wish to schedule a call with management. Our investor relations team can be reached at the contact information listed at the bottom of our press releases. Thank you, and be well.

The conference has now concluded. You may now disconnect.

Good day, ladies and gentlemen, and welcome to AmpliTech Group's quarterly investor update call, where the company will discuss its first quarter 2026 financial results. Present in this call, we have the executive team of AmpliTech Group, Fawad Maqbool, CEO, CTO, and Board Chair, Jorge Flores, COO, Louisa Sanfratello, CFO. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will be given at that time. As a reminder, today's conference is being recorded. I would now like to turn the call over to AmpliTech COO, Jorge Flores.

Thank you, Drew. Thank you for joining today's call to review AmpliTech's first quarter 2026 financial results, review of our company's outlook, and to answer investor questions. Following the initial management comments, we will open the call to these questions. An archive replay of today's call will be posted to the investor relations section of AmpliTech's corporate website. This call is taking place on Wednesday, May 13th, 2026. Remarks that follow and answer to questions may include statements that the company believes to be forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally include words such as anticipate, believe, expect, or words of similar importance. Likewise, statements that describe future plans, objectives, or goals are also forward-looking. These forward-looking statements are subject to various risks that could cause actual results to be materially different than expected.

Such risks include, among others, matters that the company has described in its press releases and in its filings with the Securities and Exchange Commission. Except as described in these filings, the company disclaims any obligation to update forward-looking statements, which are made as of to this date. With that, let me turn the call over to our CEO and CTO, Mr. Fawad Maqbool.

Thank you, Jorge, and thank you everyone for joining us today. The first quarter of 2026 reflects meaningful progress across several areas of our business. We achieved substantial revenue growth year-over-year and expanded gross margin significantly, strengthened our balance sheet, and continued transitioning key technologies from development into commercial deployment. What is important to note here is the trend towards reducing the losses and expanding gross margins as promised. We believe our investments in 5G O-RAN radio technologies, MMIC design capabilities, and advanced RF systems are beginning to contribute more meaningfully to our operational performance. We're encouraged by the increasing demand environment for next-generation wireless infrastructure and remain focused on disciplined execution, operational scalability, and long-term shareholder value creation.

Before we move further into our results and outlook, I want to briefly address the broader operating environment because it is relevant to how we think about timing, delivery schedules, and revenue recognition over the balance of the year. As a technology manufacturer with global suppliers and customers, we continue to monitor several external factors that are outside of our direct control, including geopolitical tensions, volatility in fuel and logistic costs, potential disruptions in international shipping lanes, and broader supply chain constraints. We are also seeing areas of heightened demand across the semiconductor ecosystem, particularly in memory and related components driven by AI, data center, and high-performance computing demand. These conditions can place pressure on component availability, lead times, freight costs, and production scheduling. At this time, we are not changing our full-year revenue guidance.

However, we believe it is prudent to acknowledge that the timing of certain shipments and revenue recognition may be influenced by these external conditions, as well as by customer deployment schedules, supplier lead times, and normal production cycle timing. As a result, we currently expect our revenue profile of the year to be more heavily weighted toward the later quarters, and we have mentioned this in the last investor call as well. We're on track in that respect. Also very important to mention is demand for our products and solutions remains very active, and our team is focused on managing supplier relationships, planning inventory requirements, qualifying alternatives where appropriate, and maintaining close communication with customers to support scheduled deliveries.

While these macro factors may affect the timing of revenue recognition, they do not change our long-term confidence in the markets we serve or in the strategic opportunities ahead for AmpliTech. The company continues to believe in its full-year revenue guidance to remain achievable. We continue to receive orders related to our $40 million LOI with the North American MNO, for which ship-shipments resumed earlier in April. Our distribution business is also experiencing an uptick in demand, contributing nicely to the over $20 million in backlog orders the company currently has. As for our operational and strategic progress, during the quarter, the company continued to advance commercialization initiatives related to 5G O-RAN radio systems, proprietary RF and microwave technologies, 5G MMIC chip design programs, satellite and defense communications applications, next-generation wireless infrastructure solutions.

The company also reported lower research and development expenses year-over-year as several products transitioned from active development into commercialization and deployment phases. This doesn't mean we will not invest in R&D for our products to stay ahead of the competition as always. We pride ourselves in providing unique solutions that differentiate us from other vendors in the industry. The company remains focused on expanding revenue scale, improving operational leverage, strengthening internal controls and infrastructure, increasing commercialization activity, supporting long-term sustainable growth. With this, I'll turn the call over to CFO Louisa Sanfratello to review our financial results in more detail.

Thank you, Fawad. The first quarter 2026 highlights are as follows. Revenue increased 48.6% year-over-year to $5.35 million, compared to $3.6 million in the first quarter of 2025. Gross profit increased 116.1% year-over-year to $2.57 million from $1.19 million in the prior year. Gross margin improved significantly to 48% compared to 33% in the prior year period. I repeat, gross margin improved significantly to 48% compared to 33% in the prior year period. Manufacturing and engineering segment revenue increased to $3.28 million from $0.99 million in the prior year quarter. Net loss improved 17.3% year-over-year to $1.52 million.

Cash, cash equivalents, and marketable securities increased to approximately $18.4 million as of March 31st, 2026. Working capital improved to approximately $25.4 million from $10.2 million on December 31st, 2025. Current ratio, defined as current assets over current liabilities, improved to 4.25 from 1.68 on December 31st, 2025. Multiple 5G and MMIC development programs advanced further into commercialization stages. Total assets to total liabilities improved approximately 47% to $48.36 million from $32.86 million on December 31st, 2025. It is important to highlight that AmpliTech Group remains debt free. Let us turn to the balance sheet and the company's liquidity. As of March 31st, 2026, AmpliTech reported cash equivalents, and marketable securities of $18.4 million.

Total current assets of approximately $33.2 million, and total stockholders' equity of approximately $48.4 million. During the first quarter, the company completed both a rights offering and a registered direct offering, generating aggregate net proceeds exceeding $16 million to support growth initiatives, working capital requirements, and operational expansion. I'll now turn the call back to Fawad for closing remarks.

Thank you, Louisa. To close, this first quarter is nicely setting the tone for the balance of the year for the company. We increased our year-over-year revenue while also decreasing our gross margins. Business development-wise, our participation at MWC Barcelona, one of the world's largest and most influential connectivity events, was strategically important for AmpliTech because it placed us directly in front of global mobile operators, OEMs, infrastructure providers, technology partners, and potential customers at a time when the industry is rapidly advancing toward Open RAN, private 5G, AI-enabled networks, and future 6G architectures. We achieved additional certifications with our flagship radio, our O-RAN 64T64R massive MIMO radio unit. Our O-RAN certification achievements continue to strengthen the market position of our radio portfolio. For mobile network operators, certifications help to reduce perceived deployment risk by demonstrating that our radios are being validated for open standards-based multi-vendor network environments.

We believe this gives operators greater confidence in evaluating and adopting AmpliTech radios and positions the company to benefit from increasing demand for Open RAN solutions that support vendor diversification, network flexibility, and lower total cost of ownership. These are key factors in the MNOs adopting our strategy and our products. Before we open the line for callers in the call for questions, I would like to have our COO, Jorge Flores, go over the questions previously received via email.

Thank you, Fawad. I'd like to immediately start with the first question, which is: Does the company still believe its full-year revenue guidance as achievable? Absolutely, yes. Based on the visibility we have today, including funded purchase orders, customer forecasts, active deployment schedules, and ongoing discussions across our commercial pipeline, we continue to believe our full-year revenue outlook remains achievable. That said, investors should understand that revenue recognition in our business can be influenced by the timing of customer deployments, supply chain availability, production and scheduling, shipment timing, and customer acceptance. As a result, we currently expect a greater portion of 2026 revenue to be weighted toward the later quarters of the year. Importantly, this is primarily a matter of timing, not a change in our long-term view of the opportunity.

We continue to see active demand for our 5G and O-RAN radio solutions. Our focus remains on converting funded orders and customer forecasts into shipments and be able to recognize the revenue. Next question: Are geopolitical tensions, fuel prices, logistic costs, or supply chain pressures affecting your outlook? Of course, we continue to monitor broader macroeconomic and geopolitical conditions, including tensions in key global regions, volatility in fuel and freight costs, potential disruptions in international shipping routes and supply chain constraints affecting the electronics and semiconductor industries. At this time, as previously stated, we are not changing our full year revenue guidance. However, these external factors may influence component availability, lead times, freight cost, and production scheduling. We just believe it's prudent to acknowledge these factors because they could affect the timing of shipments and revenue recognition.

Rest assured that our team is actively managing supply relationships, the inventory planning and logistic options, and customer communications to reduce risk wherever possible. Next question: How do your O-RAN certifications and validations position AmpliTech with mobile network operators? This is a good question, though. Our O-RAN certification and validation work is very important because it helps reduce perceived adoption risks for mobile network operators. These certifications are not just technical milestones. They provide third-party validation that our radios are being tested against recognized Open RAN conformance, interoperability, and performance expectations. For MNO customers, that matters because it gives them greater confidence that AmpliTech radios can operate in open, standard-based multi-vendor network environments. We believe this strengthens the commercial positioning of our radio portfolio and effectively reduce evaluation cycles, support vendor diversification, and increase confidence in broader deployment opportunities.

In short, certification helps move the conversation from, "Can this technology work?" to, "How do we evaluate and deploy it at the scale?" Next question: What did the MWC Barcelona mean for AmpliTech from a business development perspective? The Mobile World Congress show in Barcelona was an important strategic platform for AmpliTech. It placed us directly in front of global mobile network operators, OEMs, providers, technology partners, industry decision-makers at a time when the market is actively evaluating Open RAN, private 5G, AI-enabled network architectures, and future 6G planning. All of these are at our strengths right now. For us, MWC were not only about visibility, it was about strengthening awareness of AmpliTech's capability, brand name, advancing business development conversations, and reinforcing our position as a U.S.-based provider of advanced wireless and 5G infrastructure solutions.

We believe this event supported our long-term commercial strategy and helped expand the number and quality of conversations we are having across the global telecom ecosystem, creating multiple opportunities for us to participate in further interoperability testing efforts with different customers. Next questions: What gives management confidence that demand for AmpliTech's radios can continue to grow? This confidence is based on several factors. First, we have already received meaningful funded purchase orders on the previously announced customer opportunities. Second, we are seeing continued customer interest in O-RAN, private 5G, and vendor-diversified network architectures. Third, our certification and validation efforts help reduce technical risk for customers evaluating our radios. We also believe the market is moving in a direction that favors open, flexible standard-based network solution. While O-RAN adoption is increasing, the regular RAN is decreasing.

We are already there with designs that are ready to be manufactured and sold to all of these MNOs and satisfy their demands for O-RAN-related products. AmpliTech's portfolio is designed to address that market need, and our strategy is to continue building credibility through execution, certification, customer deployments, and supply chain readiness. We want to be clear that timing can vary based on customer deployment schedules and purchase orders, but the level of engagement we are seeing supports our confidence in the long-term opportunities. Last question: How should investors think about gross margins as 5G revenue scales? Gross margin remains a major focus for management. As we discussed, the initial ramp-up of carrier-grade O-RAN radio deployments placed pressure on margins last year as we invested in customer acquisition, production readiness, and early market penetration.

Looking forward and actively doing it right now, we believe margins can improve as volumes increase, production processes mature, supplier terms improve, and we gain efficiencies with our contract manufacturing partners. We are also focused on forecasting, material planning, cost control, pricing discipline, and supply chain optimization. We do not expect margin improvement to be perfectly linear quarter to quarter, especially during a ramp-up phase, but improving gross margin remains one of our key operating priorities. With that said, this concludes the questions previously received into our email. Operator, please open the line for callers' questions.

Thank you. To ask a question, you may press Star One on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you'd like to withdraw your question, please press Star Two. At this time, we will pause momentarily to assemble our roster. The first question comes from Jack Vander with Maxim Group. Please go ahead.

Okay, great. thanks for taking my questions. Fawad, so good to see the strong year-over-year revenue growth, and definitely strong gross margin expansion. It looks like Spectrum or the international sales definitely rebounded back to normalized levels. I'm wondering how much revenue from this quarter roughly was from the LOI orders.

Jorge, can you answer this?

Right now, from our 5G division, we will say that the revenues, the revenue mix, from our AmpliTech 5G, it was a very high percentage of sales were attributed to the $40 million LOI. Mostly from the $40 million LOI.

Got you. Okay. Somewhere maybe between $2 million and $3 million. Does that feel about right?

Yeah, a little bit more than that.

Okay. SG&A, maybe this is a question for Louisa.

Yeah.

Expenses. The gross margin expanded nicely. SG&A expenses did tick up.

Yes.

Quite a bit more of non-cash stock comp. Just wondering kind of what the reason is there, and if that's a normalized level going forward.

We did Normally speaking, our first quarter, our SG&A expenses are a lot higher as we incur the audit expense, we incur D&O insurance expense, we get hit with our NASDAQ fees and so forth. Typically speaking, SG&A is higher in the first quarter, and we did have the stock compensation expense. We did have the trade show that ran us about $180,000, in addition to hiring a new marketing company to help us expand sales and our outreach. We can probably see an uptick with the SG&A.

Excuse me. Just one moment. This is the operator. It seems like there has been an interruption. Just a moment, please.

Sure. SG&A is going to be.

Yeah.

Excuse me. This is the conference operator. There seemed to have been an interruption. Ms. Sanfratello, were you still answering the question?

I was just reiterating that for the first quarter, we always see an uptick in SG&A because of those expenses in the audit fees that was completed for the first quarter. The D&O insurance is always, we activate it. We reactivate it in the first quarter, as well as the NASDAQ fees and so forth. We may see a little uptick in SG&A as we expand and we, you know, with our revenue guidance, but it all, it really all depends.

Okay. Got it.

Does that answer your question?

Yeah. No, Louisa, that's great. That's great. Maybe, separately, looking at the full year outlook. Maybe this is for Fawad. It sounds like maybe you have limited visibility, just given the geopolitical tensions in the world, and a few other, maybe some shortages in the memory market. It sounds like the guidance is still achievable for that $50 million of revenue, just more back half loaded. I'm wondering now that we're almost halfway through the second quarter, how is the second quarter kinda shaping up? Is there any color you can provide, maybe orders received? You just did $5.3 million of revenue in the first quarter. Any guidance or I guess commentary you could provide would be helpful.

Well, this is Jorge. So far we started the month of April very nicely. As I mentioned previously, we resumed the shipments on our $40 million LOI to our MNO in North America. Right now things are looking very nicely for Q2. We continue to receive orders against that LOI as well. The supply chain is prime and ready to go.

That's as far as I can share right now though, due to the ongoing, we cannot disclose stuff that is not publicly released as of yet.

Okay. Got it. I guess, could you maybe just make it more clear how many, how much orders you've received in the second quarter or expect to receive? Would it I mean, is there a chance that the second quarter is maybe flat or down from the first quarter, the back half is very strong? Just trying to get a sense of what to expect.

No, definitely not. We are projecting Q2 to be definitely much higher than Q1.

Okay, fantastic. I appreciate that color. Then maybe just one more. This one's definitely for Fawad. Fawad, it sounds like you've had success at the trade shows. Sounds like you had a lot more discussions going on.

Yeah

The two vendors that you've disclosed, right? We have the North American MNO that we all know who that is, and then, there's the other, value-add reseller, I believe. Is there any other discussions that are kinda warming up where you feel like maybe you will be able to announce another LOI in the future? Anything you could provide there, I'd be interested to hear. Thank you.

Yes. We have had very productive discussions and conversations with major MNOs, and we will probably, it's more likely that they'll go straight to POs, no LOIs. We'll be announcing those in the next quarter or so, in relatively short period of time, actually, because these discussions are ongoing, and we're just finalizing all these. There's a demand, increased demand, I don't know whether it's a sudden demand or not, but it is increasing in the 64T64R, the massive MIMO. There's all sorts of applications that are commercial as well as military that are now becoming more and more evident for all larger MNOs.

Our success as being the largest O-RAN deployment in North America or in America, that's helping us to reach out and reach further in Europe and in other areas of the world.

Okay. Got it. Then just one last question. I'm not sure if you can provide any color on this, but the larger LOI of, you know, in excess of $70 million, it was my understanding that this one might be chunkier in terms of the size of the orders once you do receive them. Do you have any sign or color or just, you know, expectations of when you'll receive a substantial order under that larger LOI? Thank you.

Yeah. We expect that to happen later this year. Again, that's all dependent on the customer being able to deploy their original quantities in the field, and that has slowed down somewhat. It slowed down due to many different factors, and some of them what we mentioned already.

Yep

all over the world. It also, it's like a ripple effect. Fortunately, we haven't felt any tremendous impact. You know, the supply chain for these guys overseas, because of the locations, it slows things down. We don't expect that to go away. It's just going to be a little bit later, as we said, later towards the year.

Okay, great. It sounds like you still feel very good and confident about that LOI, being recognized. It's just a matter of when.

Right

just given the world environment we're in. Okay.

Right.

Great. I appreciate the questions and the answers and look forward to watching you execute. Thank you.

Sure. Thank you, Jack.

Again, if you have a question, please press Star then One. The next question comes from Richard Kreger with Moody Capital. Please go ahead.

Hello. Congratulations on the fantastic quarter.

Thank you.

I've got two questions. Given AmpliTech's gross margin has expanded dramatically from approximately 33% to 48% quarter-over-quarter, which looks like about a 1,500 basis point improvement, how sustainable is that, and is there the possibility of that margin expanding as revenue scales?

Yeah. There's a very good chance it's expanding even more because we have been investing. As mentioned before, we have been investing in initial deployments to get our foot in the door with the larger MNOs. I believe we have done that already and proven that we can do that. That kind of investment is behind us. We are now acknowledged by our MNOs as being a very valid provider of these sophisticated radios, and especially the higher configuration radios. We believe that the margins will expand further. That's the way we are planning it now. I mean, we don't have to do any more of the types of investment that we did earlier.

Okay. Thank you, Fawad.

Yes.

The second question I have is, you know, AmpliTech's been doing a lot of testing and verifications with universities such as Northeastern University. Number one, can you talk a little bit more about where you stand with all the university verifications and testing, the competitive environment for those O-RAN testing, accreditation? Secondly, do you see any orders coming from any of the universities in terms of them ordering any equipment or testing equipment further beyond what we've read in the recent press releases?

Good question. Good question. Yes, we do see with the universities testing our radios, we have gotten exposure to not only the massive MIMO radios, and which, by the way, we are the world's only 64T O-RAN 5G massive MIMO radio company. We are certified by the OTIC center. Northeastern University, through its Institute for the Wireless Internet of Things, has certified us as an OTIC vendor for the largest configuration radio that exists today, and we're the only ones in the world. That's a unique position for us, and that gives us leverage to push our other products, the lower configuration, 32T, 32R, and then also the 4T4R, which are used in private 5G type applications as well as commercial MNO deployment.

We got exposure in these lower configuration radios, and they're also targeting private 5G deployment in these universities. Specifically in both Northeastern, we've been putting our radios in there under test. They are going to deploy them full across their campus, as well as other universities that are looking to put our enterprise private 5G system in place in the university. As these roll out, other universities will also take advantage of the unique position that we have for these private 5Gs. All these sectors like the commercial MNO, the military applications as well, we have several military applications for this as well. Department of Defense, they have shown large interest in these configurations. The private 5G enterprise is growing as well.

We'll get more exposure on these private 5G systems because that is a key in Industry 4.0 where all the industries are targeting automation and monitoring using AI-based tools. In addition to that, we're also showcasing our fixed wireless access capabilities. Fixed wireless access means that there's no cable or no fiber, it's all wireless at very high speeds provided to the homes or businesses. We are the only U.S.-based company that can provide everything from the tower to the home and all the IoT devices in between. That's a very unique position for us to be in to service this growing industry.

Okay. Was there a follow-up, Mr. Kreger?

No, I'm good. Thank you so much.

Thank you.

Thank you.

That concludes the Q&A session. I will now turn the call back to Fawad Maqbool for closing remarks.

Thank you, operator, thanks to everyone who joined today's call to hear about the progress we've made and the plan we have to further our company's mission of providing the communication systems of tomorrow, today. We look forward to updating you further on our 2nd quarter financial results call sometime in August. Until then, please contact us directly should you have any questions or wish to schedule a call with management. Our investor relations team can be reached at the contact information listed at the bottom of our press releases. Thank you, be well.

Today's conference call is now concluded. Thank you. You may now disconnect your lines.