Forward Industries, Inc. Q1 FY2026 earnings call

• Solana has seen growth in partnerships like Revolut, Western Union, etc., and is being used at scale in payments, DeFi, etc.
• Forward transitioned to a Solana treasury company, with FWDI shares issued on Solana via Superstate's platform.
• Collaborated with Sanctum to launch fwdSOL, a liquid staking token, with ~25% of SOL holdings represented by it.
• Tested proprietary automated market maker (Prop AMM) developed with Galaxy and Jump Crypto.
• Focus on compounding SOL per share long-term, not managing around short-term market moves.

In the first quarter of Fiscal 2026, Forward Industries' revenue increased more than 4x to $21.4 million compared to $4.6 million in the prior year. Gross margin improved significantly to 78.6% from 24.5% in the same period last year, driven by staking revenue from the Solana treasury strategy. As of December 31, 2025, Forward held approximately 6,962,501 Solana with over 99% staked, generating native staking yield between 6.5% and 7.2%. They compounded fully diluted SOL per share from 0.0604 to 0.0624, with an annualized SOL per fully diluted share growth of roughly 13% in the quarter. Cash balance was $25.4 million as of December 31, 2025, down from $38.2 million in the prior quarter.

• Focus on being an active participant in the Solana ecosystem to drive SOL per share growth.
• Potential M&A in debt and non-debt scenarios, with focus on accretive opportunities and pushing Solana ecosystem forward.
• Long-term disciplined approach, viewing market dislocations as opportunities for offense when peers are on defense.
• SOL per share growth as North Star KPI, aiming for risk-adjusted returns greater than Solana staking yield.

• Volatility in crypto markets impacting SOL price and overall company performance.
• Risk of competitors leveraging up and being at risk, contrasting with Forward's clean balance sheet.
• Regulatory uncertainties that could affect the company's ability to execute on-chain financial infrastructure plans.

Q: How do you expect staking yields to trend as Solana network usage grows?

A: More network activity and volatility increase MEV and fees, increasing yield to stakers. Inflation on Solana is trending downwards.

Q: Can you clarify related party G&A expenses?

A: Related to launch of digital asset treasury strategy, expected to decrease in coming months, with normalized SG&A run rate to be less but not specified currently.

Q: Dive into aspects of outperformance in yields?

A: Outperformance is from staking yield, share buybacks when accretive, and fwdSOL being immaterial to the amount.

Q: What's the deciding factor for buybacks vs M&A?

A: Relative value equation; better FWDI trades lower buyback appetite, increases M&A appetite when peers are more dislocated.