Kopin Corporation Q3 FY2025 earnings call

• Strategic partnerships: Entered into partnerships with Ondas Holdings, Unusual Machines, and Theon International. - Company transformation: Kopin has transformed with new management, fixed quality issues, strong customer relationships, and updated branding. - Defense opportunities: Increased defense budgets and needs for enhanced situational awareness drive growth, especially in Europe, Southeast Asia, and NATO countries. - New CFO: Erich Manz joined as CFO on September 2, bringing financial expertise. - Neural display: Demonstrated a first-person viewer, bidirectional, human in the loop microdisplay (neural display) at AUSA, with investment planned for development. - Kopin One: Fully integrated, with HR handling cultural transition. Fab-lite strategy: Almost complete, focusing on U.S. DoD and NATO applications. Automation: First wave operational, second phase to be implemented in December, expected to improve efficiencies and throughput.

Total revenues for Q3 2025 were $12 million, down from $13.3 million in the prior year. Product revenues were $10.7 million in Q3 2025, compared to $10.9 million in Q3 2024, primarily due to a decrease in revenues from products used in pilot helmets and training and simulation, partially offset by an increase in sales from products used in thermal weapon sights. Funded research and development revenues decreased to $1.2 million in Q3 2025 from $2.3 million in Q3 2024. Cost of product revenue for Q3 2025 was $8.4 million, or 79% of net product revenues, compared with $8.3 million, or 76% of net product revenues in Q3 2024. Net income for Q3 2025 was $4.1 million or $0.02 per share, compared with a net loss of $3.5 million or $0.03 per share in Q3 2024.

• Backlog: Kopin has roughly 80% of the backlog required to hit the 2026 plan. - Program visibility: Visibility on thermal weapon sight, aviation helmet, and medical programs until 2027-2030. - European growth: Expect revenue growth in Europe starting in 2026, with tens of millions of revenue in 2027 and 2028. - Soldier Borne Mission Command: Part of the $1 billion opportunity pipeline, with technology development underway and goal to have devices designed into applications by 2027.

• Potential risks include demand for products, operating results of subsidiaries, market conditions, and other factors discussed in the company's most recent annual report on Form 10-K and other SEC filings.

Q: Any developments on neural display?

A: At AUSA, demonstrated a first-person viewer, bidirectional, human in the loop microdisplay (neural display) controlling a drone application with the eye, with investment planned for development.

Q: How should we think about quarterly OpEx, particularly with Blue Radios behind us?

A: Spending expected to be similar to recent quarters, with growth into it being the objective.

Q: How should we think about 1- or 2-year out pipeline or backlog?

A: Kopin has 80% of backlog for 2026, with visibility on thermal weapon sight, aviation helmet, and medical programs until 2027-2030.

Q: Update on Kopin One initiatives and automation?

A: Kopin One is fully integrated. Fab-lite strategy almost complete. First wave of automation operational, second phase to be implemented in December, expected to improve efficiencies and throughput.

Q: Background on pilot, aviation heads-up display issue?

A: It was a timing issue, a manufacturing to demand push from this quarter to next.

Q: How to think about revenue from Europe?

A: Expect to expand European business quickly in 2026, with revenue in the single high millions in 2026 and tens of millions in 2027 and 2028.

Q: When will Soldier Borne Mission Command move to revenue?

A: Soldier Borne Mission Command has two prime contractors competing, with Kopin having received a $15.4 million contract award for technology development, expecting further investments in 2026 and goal to have devices designed into applications for production in 2027.