AmpliTech Group Q2 2026 Earnings Call - Heavy Investment Phase Masks Strong Margin Growth and Strategic Capital Raise

Operator: 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.

Jorge Flores, Chief Operating Officer (COO), AmpliTech Group: 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.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: Thank you, George. 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.

Louisa Sanfratello, Chief Financial Officer (CFO), AmpliTech Group: 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% to 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.

Jorge Flores, Chief Operating Officer (COO), AmpliTech Group: 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 Fabian 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.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: Thank you, George. 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 George, AmpliTech Group’s COO, to address previously received questions into our email.

Jorge Flores, Chief Operating Officer (COO), AmpliTech Group: 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.

Operator: 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.

Jack Vander Aarde, Analyst, Maxim Group: Okay, great. Good evening. Thanks for taking my questions. Fouad, 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 half 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.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: Yes, you are correct in that observation, Jack. How are you doing? George, do you want to answer that?

Jorge Flores, Chief Operating Officer (COO), AmpliTech Group: 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.

Jack Vander Aarde, Analyst, Maxim Group: Okay, thanks, George.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: Jack.

Jack Vander Aarde, Analyst, Maxim Group: Yep.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: 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.

Jack Vander Aarde, Analyst, Maxim Group: 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?

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: 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.

Jack Vander Aarde, Analyst, Maxim Group: 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.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: George, you want to handle it?

Jorge Flores, Chief Operating Officer (COO), AmpliTech Group: Yeah. Jack, this is George. 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.

Jack Vander Aarde, Analyst, Maxim Group: 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?

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: Yes, it is still active. It is still active, and again, since these individual countries, George 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.

Jack Vander Aarde, Analyst, Maxim Group: Yep.

Jorge Flores, Chief Operating Officer (COO), AmpliTech Group: 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.

Jack Vander Aarde, Analyst, Maxim Group: 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-

Jorge Flores, Chief Operating Officer (COO), AmpliTech Group: Yeah

Jack Vander Aarde, Analyst, Maxim Group: You could touch on or Go ahead.

Jorge Flores, Chief Operating Officer (COO), AmpliTech Group: 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.

Jack Vander Aarde, Analyst, Maxim Group: Okay, great. No, that sounds very encouraging. I appreciate the time. I will hop back in the queue. Thanks.

Jorge Flores, Chief Operating Officer (COO), AmpliTech Group: Thank you for the question, Jack.

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

Palmer Fortune, Private Investor: Hello, everyone. How is everyone doing?

Jorge Flores, Chief Operating Officer (COO), AmpliTech Group: Good. How are you?

Palmer Fortune, Private Investor: 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?

Jorge Flores, Chief Operating Officer (COO), AmpliTech Group: 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.

Palmer Fortune, Private Investor: Is that— I’m sorry.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: The timing has changed. The timing is the difference there right now.

Palmer Fortune, Private Investor: I understand. When you say everything is in place, does that mean customers are in place?

Jorge Flores, Chief Operating Officer (COO), AmpliTech Group: 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.

Palmer Fortune, Private Investor: I could read into your answer of you saying that $50 million could happen before the end of the year?

Jorge Flores, Chief Operating Officer (COO), AmpliTech Group: It could.

Palmer Fortune, Private Investor: 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.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: It is no problem. I do not know if it is the lack of guidance, Tom. Is it specifically to this subject that you are talking about or everything else in general?

Palmer Fortune, Private Investor: 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.

Jorge Flores, Chief Operating Officer (COO), AmpliTech Group: Well, but when it comes to that, Mr. Palmer, this is George. It is that-

Palmer Fortune, Private Investor: Yes, sir.

Jorge Flores, Chief Operating Officer (COO), AmpliTech Group: 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.

Palmer Fortune, Private Investor: George, 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

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: Right

Palmer Fortune, Private Investor: 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?

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: Yeah. Thank you, Tom.

Operator: Absolutely.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: Appreciate it.

Palmer Fortune, Private Investor: No, thank you. Have a good evening.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: Take care. You, too.

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

Lennox Brooks, Investor, Fort Washington Investment: Hey, team. Congrats on the progress and on the quarter.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: Thank you, Lennox.

Jorge Flores, Chief Operating Officer (COO), AmpliTech Group: Thank you.

Lennox Brooks, Investor, Fort Washington Investment: 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?

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: 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 or B 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.

Lennox Brooks, Investor, Fort Washington Investment: That all totally makes sense, though. Yes, it does. I appreciate it.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: Okay, great.

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

Richard Kreger, Investor, Moody Capital Solutions: 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.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: 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 2 or 3 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.

Richard Kreger, Investor, Moody Capital Solutions: 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?

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: 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.

Richard Kreger, Investor, Moody Capital Solutions: Do you mind if I ask one more question about the AI RAN Alliance?

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: Sure.

Richard Kreger, Investor, Moody Capital Solutions: 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.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: 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.

Richard Kreger, Investor, Moody Capital Solutions: Okay, thank you. No further questions.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: No problem. You’re welcome.

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

Andrew DeAngelis, Investor, Venture Capital: 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.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: 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.

Andrew DeAngelis, Investor, Venture Capital: 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?

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: I don’t think end of July we can do that, Louisa?

Louisa Sanfratello, Chief Financial Officer (CFO), AmpliTech Group: 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.

Andrew DeAngelis, Investor, Venture Capital: Understood.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: Yeah. July would be outside the June 30th quarter, right? So we can only disclose information up to June 30.

Andrew DeAngelis, Investor, Venture Capital: 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?

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: 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.

Andrew DeAngelis, Investor, Venture Capital: Thank you. Thank you all. Have a great evening.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: You are welcome. Thank you.

Operator: 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.

Fawad Maqbool, Chief Executive Officer (CEO), Chief Technology Officer (CTO), and Board Chair, AmpliTech Group: 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.

Operator: The conference has now concluded. You may now disconnect.