Kopin Corporation Q4 FY2025 earnings call

1. Strategic partnerships and global expansion: 2025 was pivotal. One Koppen initiative integrated businesses, Fab Light strategy expanded OLED deposition partnerships, European expansion with FION started, partnership with Zeon aligns with defense needs, and partnerships with Ondas Holdings and Unusual Machines position for U.S. drone market. 2. Defense programs: Defense programs are core. SBMC program progresses, color micro - LED award is a landmark, Soldier - Born Mission Command program has prime contractor selections, and there are advancements in various defense - related systems. 3. Technology and operational progress: Investment in automation is delivering results with improvements in throughput, quality, and cost efficiency, expecting over $1 million in annual operating expense savings. Neural display technology advances, and the company is the only manufacturer of four types of micro - displays and inventor of a fifth.

Total revenues for the fourth quarter ended December 27, 2025, were $8.4 million, compared to $14.6 million in the prior - year quarter. Product revenues were $5.6 million in Q4 2025 vs. $12.6 million in Q4 2024. Non - product revenues were $2.5 million in Q4 2025 vs. $1.7 million in Q4 2024. Cost of product revenue for Q4 2025 was $4.7 million, or 83% of net product revenues, compared to $10.7 million or 84% in the prior - year quarter. Research and development expenses were $3.5 million in Q4 2025 vs. $3.2 million in Q4 2024. Selling, general, and administrative expenses were $4.5 million in Q4 2025 vs. $3.1 million in Q4 2024.

The company provided a conservative guidance for 2026 of between $52 million to $60 million in revenue. While the government shutdown had an impact in Q4 and some continued impact in Q1 2026, confidence is in strategic positioning and strong pipeline for revenue recovery as government operations normalize.

Potential risks include demand for products, operating results of subsidiaries, market conditions, and other factors discussed in the most recent annual report on Form 10 - K and other SEC - filed documents. The government shutdown was an unforeseen speed bump but is not a trend, but other risks could affect actual results.

Q: Highlight what the backlog is as of December 31st and remaining performance obligations.

A: At the end of the year, backlogs were in the range of 37 million, and expecting to book several larger orders in the next eight weeks.

Q: Regarding the micro - LED program, did delays from Q4 extend into 2027?

A: Working towards completion for this year with original milestones, technical program is well on track but unsure how Army will respond to testing.

Q: Potential capacity needs for SBMC program?

A: Selected tooling equipment for production line, can service requirements, no further CapEx needed currently for SBMC and other programs.

Q: When to expect $1 million annualized savings from automation initiatives?

A: Starting to see it now, washing through OPEX.

Q: View on commercial market opportunity in U.S. for drones post - DJI ban?

A: Increased demand in first - person viewers, with several massive drone companies working, expecting meaningful results by Q3.

Q: Thoughts on $450 billion reconciliation bill and contract award opportunities?

A: Active on Capitol Hill, requested additional IBAS funding, expect budget news around September, and active in Europe discussions.

Q: Elaboration on new markets and new technologies?

A: Two new products and product lines in new markets to be announced this year, not ready to talk about yet