Beam Global Q1 FY2026 earnings call

• Strategic Transformation & Customer Diversification

  • 2025 was a pivotal inflection point after the U.S. federal government abruptly ended its fleet electrification program, eliminating the company's historically largest revenue stream which made up 80% of revenue just a few years prior.
  • The company successfully transitioned from a single-product, single-customer, single-country business to a diversified business with three core segments: energy storage and security, electric mobility/transportation, and smart cities infrastructure.
  • Non-federal customer revenue tripled in 2025 compared to prior non-federal revenue levels, growing from $10 million (excluding federal revenue in the company's peak year) to ~$28 million.
  • The company now has products deployed in 23 countries globally, with manufacturing facilities in San Diego (US), Chicago (US), and two locations in Europe (Serbia).

• Key Strategic Initiatives

  • Formed Beam Middle East, a joint venture with UAE-based Platinum Group (chaired by a member of the UAE ruling family), to access the region's over $1 trillion planned sustainable infrastructure investment over the next decade. The joint venture leverages Platinum Group's local relationships and infrastructure to minimize BEAM's capital outlay, with plans to move from local assembly to full manufacturing as volume grows. Early traction has been achieved, with large opportunities already in the pipeline.
  • Developed a patented, off-grid wireless autonomous vehicle (AV) charging solution that eliminates the need for human intervention and centralized charging hubs, solving a major barrier to widespread AV deployment. The company is positioned to pursue this opportunity in all major AV markets (US, Europe, UAE, which has publicly targeted global AV leadership).
  • Grew custom energy-dense battery solutions for specialized drone and autonomous vehicle applications, leveraging proprietary thermal management to deliver bespoke form factors, improved safety, longer life, and lower total cost of ownership compared to off-the-shelf alternatives. The company already has multiple confidential customers, including defense and military clients, in both the US and internationally.
  • Advanced integrated smart cities ecosystems that combine BeamSpot street lighting (with on-board energy storage and solar/wind generation) with EV charging, electric bike sharing, and smart sensor capabilities, delivering replicable solutions with potential for long-term recurring high-margin revenue.
  • The Federal General Services Administration (GSA) renewed BEAM's federal purchasing contract through 2030, indicating ongoing recognition of the company's products for future federal opportunities.

• Financial Discipline & Accounting Clarification

  • The $11 billion non-cash goodwill impairment charge recorded in 2025 was required by accounting rules due to a temporary decline in the company's share price, and does not reflect management's view of the value of prior acquisitions, which management believes are performing well and delivering significant value.
  • The company maintains a lean, debt-free balance sheet with disciplined cost management; non-cash operating expenses fell 17% year-over-year even as the company expanded into new markets and products. Unit economics across all products have improved, with product-level gross margins over 40% meaning each product sale generates incremental positive cash flow.

Overall 2025 full-year revenue was $28.2 million, down from $49.3 million in 2024, driven by a sharp drop in U.S. federal orders which fell from over 60% of 2023 revenue to less than 5% in 2025. By customer segment: Commercial customers represented 72% of 2025 revenue, up from 38% in 2024; non-federal government business grew significantly to offset lost federal revenue; international sales accounted for almost 50% of 2025 full-year revenue, up from 0% in prior years. By product segment: EV charging (the company's legacy product) represented only 11% of end-of-2025 backlog; energy storage and security contributed over 30% of end-of-2025 backlog; smart cities infrastructure is a fast-growing segment that delivered record weekly sales in early 2026 (including $1 million and $1.7 million single-week sales); new and expanded products made up 70% of Q4 2025 revenue. Profitability: Q4 2025 gross margin was 18%; full-year 2025 GAAP gross margin was 13%, and non-GAAP gross margin (excluding non-cash depreciation and amortization) improved to 23% from 21% in 2024. Full-year 2025 operating expenses were $31.1 million ($16.1 million excluding non-cash charges, a 17% year-over-year reduction); GAAP net operating loss before tax was $27.4 million, and non-GAAP net operating loss before tax was $9.5 million, up from $8.6 million in 2024 due to lower revenue. Liquidity: End-of-2025 backlog was $6 million, growing to $9 million by early 2026, with over 50% of backlog from international operations; the company ended 2025 with $8.9 million in working capital, no material debt, and a $100 million undrawn credit facility, giving it strong financial flexibility.

• Management did not provide specific quantitative revenue or earnings guidance for 2026, noting that unforeseen geopolitical and policy changes make forecasting highly uncertain.
• The core expectation for 2026 is diversified growth across the company's three core business segments, across both domestic U.S. and international markets, with reduced exposure to any single customer or policy shift.
• Management expects strong growth from new product lines including specialized drone batteries, autonomous vehicle charging, integrated smart cities infrastructure, and Middle East market expansion, with early backlog growth indicating positive momentum entering 2026.
• Management expects full-year 2026 margins to benefit from ongoing improvements in unit economics across all products, with higher-margin specialized products (custom batteries, integrated smart solutions) expected to grow as a share of revenue, driving overall margin expansion as sales volume increases.
• The company maintains sufficient liquidity to fund planned 2026 growth initiatives and operations, and is positioned to scale quickly as demand grows.

• Geopolitical risk: The ongoing regional war in the Middle East could delay the growth of Beam Middle East and impact the timing of large expected opportunities in the region, though management notes significant opportunities remain even if the conflict drags on.
• Policy risk: The current U.S. federal administration's reversal of fleet electrification policy eliminated the company's historically largest revenue source, and future policy changes continue to create uncertainty for federal and domestic EV-related demand.
• Tariff risk: 37% tariffs on Serbian manufactured goods limit the company's ability to import European-manufactured products into the U.S., increasing costs and constraining planned manufacturing footprint optimization.
• Demand uncertainty: While the company has successfully diversified its revenue base, nascent product lines (autonomous vehicle charging, drone batteries) are dependent on the growth of emerging markets, and the timing of widespread adoption of these technologies is uncertain.
• Sales execution risk: The smart cities infrastructure market is still in early development, and BEAM's current push-led sales process (presenting integrated solutions to customers rather than responding to formal RFPs) may take longer than expected to scale into meaningful revenue.

Q: 70% of Q4 2025 revenue comes from new products — which products are driving this growth, what is the approximate year-over-year growth rate for new products, and will the current backlog convert quickly? / A: Smart cities infrastructure products are the largest contributor to new product revenue, with growth also coming from energy storage. The company has shifted from relying almost entirely on its legacy EVR EV charging product to a broad diversified portfolio, so growth is spread across multiple new lines. Most new products were not meaningfully sold in prior years, so growth is very strong. Nearly all of the current $9 million backlog will convert to revenue in the next one to two quarters, with no material long-dated backlog. Supply chain constraints are not currently limiting shipments, and backlog has grown from $6 million at end-2025 to $9 million in early 2026, indicating positive momentum.

Q: Can existing products be modified for new applications like drone charging under the renewed GSA federal contract? / A: BEAM already has a purpose-built patented drone charging product, Beam Flight, which operates off-grid with no required construction or fixed infrastructure and allows drones to recharge autonomously. While this new product is not currently added to the existing GSA contract, the contract renewal signals GSA expects future use of BEAM products, and the company plans to add new products including Beam Flight and autonomous vehicle charging to the contract in the future. Management expects federal demand for energy storage, drone, and autonomous vehicle solutions will remain strong even in the current administration, with a large potential rebound in EV-related demand when policy shifts again.

Q: What characteristics make BEAM's batteries attractive for drone manufacturers, and where is demand coming from? / A: BEAM differentiates by building custom-shaped batteries that fit the specific design of drones, rather than requiring manufacturers to design around standard square/rectangle off-the-shelf batteries. Proprietary integrated thermal management enables higher energy density, prevents thermal runaway, and extends battery life, resulting in a lower total cost of ownership despite a higher upfront price. BEAM already has multiple confidential domestic and international customers, including U.K.-based Ray Systems (underwater drones) and classified U.S. military programs. Significant international demand is also expected for border surveillance drone applications in the Middle East and for operational use in contested environments like Ukraine.

Q: What is the sales process for smart cities infrastructure, and how will product mix impact 2026 margins? / A: BEAM's smart cities business is currently push rather than pull — the company proactively presents its vision of integrated, intelligent street infrastructure to customers, which allows it to avoid commoditization and maintain higher margins. The business leverages 30 years of existing customer relationships from BEAM's European acquisition, and management sees massive long-term potential in adding intelligent sensing and data capabilities to ubiquitous street lighting infrastructure. Margin outcomes in 2026 will depend on product mix, but the fastest growth is currently in higher-margin specialized products (custom batteries, integrated solutions), and unit economics have improved across all product lines. Management is not prioritizing products based on margin, instead pursuing growth across all three core segments to maintain diversification.