Greetings, ladies and gentlemen, and welcome to the WISeKey International Holding first half 2026 financial results earnings conference call. As a reminder, this conference call contains forward-looking statements. Such statements involve certain known and unknown risks, uncertainties, and other factors which could cause actual results, financial condition, performance, or achievements of WISeKey International Holding Ltd to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. WISeKey is providing this communication as of this date and does not undertake to update any forward-looking statements contained herein as a result of new information, future events, or otherwise. At this time, all participants are in a listen-only mode. A brief question- and- answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded.
It's now my pleasure to introduce Carlos Moreira, Founder and Chief Executive Officer of WISeKey. Mr. Moreira, please go ahead.
Thank you very much, and thank you all for joining us this morning. I am joined today by our Group CFO, John O'Hara. The first half of 2026 was a period of meaningful progress for WISeKey. We continue to improve our financial performance while advancing key strategic priorities, including the commercialization of our post-quantum semiconductor technology, the expansion of our quantum technology strategy, and the development of our secure space infrastructure platform. We also continue to refine our corporate structure to provide investors with greater visibility into the value and growth potential of our technology businesses. For the first six months of 2026, preliminary unaudited revenue increased approximately by 116% to approximately $11.4 million, compared to $5.3 million in the first half of 2025. Gross profit increased 192% to $5.5 million, and gross margin expected to approximately 48%, compared with 35% in the prior year period.
This result reflected improved product mix, as well as the increasing contribution of our semiconductor engineering and related technology capabilities. At June 30, we had approximately $495 million in cash, unrestricted cash with minimal debt. This gives WISeKey an unusually strong financial foundation from which to execute our long-term strategy commercializing post-quantum technology, building sovereign semiconductors on cybersecurity capabilities, developing quantum platform, expanding trusted digital identities, and advancing in secure space infrastructure. We have built this technology and investment over many years. In 2026, they are increasingly coming together as one commercial ecosystem.
Our priorities are clear and measurable, which are convert the SEALSQ commercial pipeline into recognized revenue, move post-quantum semiconductor products from qualification and certification towards volume production, complete our planned corporate structure initiatives, including the WISeKey redomiciliation and the proposed WISeSat and Quantisimo transactions, continue expanding sovereign semiconductor, cybersecurity, and trusted infrastructure capability in jurisdictions, build value across our technology platforms while maintaining a common root of trust. We will provide more details on each of these areas shortly. Before doing that, I will ask John to provide an overview of our first half financial performance. I will then return to discuss the strategic progress and outlook. John, please go ahead.
Thank you, Carlos, and good morning, everybody. As Carlos noted, preliminary unaudited revenue for the first half of 2026 was $11.4 million, an increase of 116% from $5.3 million in the first half of 2025. This stems from the revenue increase of our core semiconductor and PKI product lines, the first revenues relating to the Quantix Edge project, and the consolidation of six months revenue of IC'ALPS and one month revenue of Miraex and Wecan Group SA, both acquired on June 1st, 2026. Gross profit increased 192% to $5.5 million, compared with $1.9 million in the prior year period. Gross margin expanded to approximately 48%, from approximately 35% in the first half of 2025. The gross margin improvement reflects changes in revenue mix and the growing contribution from higher value technology, semiconductor, and engineering activities.
We will continue to focus on the opportunities that can support revenue growth while improving the quality and scalability of the group's revenue base over time. Operating loss for the first half was $40.9 million, compared with $27.3 million in the first half of 2025. Net loss was $36.4 million, compared with $22.3 million in the prior year period. Of note, in H1 2026, the group recorded R&D expenses of $9.1 million net of stock-based compensation, showing an increase by $5.1 million in comparison with the $4 million net of stock-based compensation for the six months ended June 30, 2025. The increase was primarily attributable to the consolidation of the results of IC'ALPS, acquired in August 2025, with $4 million R&D expenses.
Additionally, approximately $1 million of R&D expenses related to group-wide intangible asset amortization, substantially all of which relates to intangible assets recognized in the Miraex, Wecan, and IC'ALPS transactions. The increase in operating and net losses principally reflects the investments we are making across the group's strategic platforms, including post-quantum semiconductors, quantum technologies, secure infrastructure, satellite initiatives, product development, certification, engineering, and planned corporate transactions. At June 30, 2026, WISeKey had approximately $495 million in cash and restricted cash and minimal debt. This liquidity position gives us the flexibility to continue investing with a long-term perspective while also pursuing strategic opportunities across the group. It supports our ability to fund commercialization, product development, certification, infrastructure initiatives, and selective acquisitions without relying on short-term financing needs. Turning to our guidance, WISeKey reaffirms its expectation for full-year 2026 revenue growth of 50%-100% compared with 2025.
This outlook reflects our current expectations regarding the timing and execution of existing programs, semiconductor and ASIC design activity, digital identity and PKI services, sovereign infrastructure initiatives, and the initial commercialization of our post-quantum product portfolio. As always, this guidance is subject to risks and uncertainties described in our public filings, including customer timing, certification, production schedules, market conditions, and the conversion of commercial opportunities into recognized revenue. I will now turn the call back to Carlos. Thank you, Carlos.
Thank you, John. I would like to spend the remainder of my prepared remark discussing the four strategic areas that define our next phase of development. Number one, the post-quantum semiconductor commercialization through SEALSQ. Number two, SEALQuantum Sovereign Vertical Stack and the planned Quantisimo platform. Number three, WISeSat and the Quantum Spatial Orbital Cloud. Number four, our corporate structure and capital market initiatives, including the expected WISeKey direct listing. Starting with post-quantum commercialization, SEALSQ remains the technology foundation of the WISeKey Group. During 2026, SEALSQ continued advancing the QS7001 post-quantum secure element and the QVault TPM product line through important validation, security testing, and customer engagement stage. The QS7001 achieved NIST SP 800-90B Entropy Source Validation, an important step towards the FIPS 140-3 and Common Criteria EAL5+ certification. We also completed Common Criteria fault injection and side channel resistance testing.
Engineering samples of the QVault TPM are now available to customers. Separately, SEALSQ received FIPS 140-3 Level 3 validation for its VaultIC408 secure element. These achievements matter because the transition towards quantum-resistant cryptography is no longer a distant theoretical issue. Government enterprises and critical infrastructure operators are beginning to prepare for migration to post-quantum security architecture. This is creating what we believe will be a multi-year commercial opportunity for secure semiconductor, trusted identity, hardware security module, PKI, and related infrastructure. As of June 30, more than 150 customers and prospects were engaging with SEALSQ post-quantum technology, and more than 30 were actively evaluating or integrating QS7001 and QVault TPM. As of September 22, SEALSQ commercial pipeline exceeded $225 million through to 2029. More than $100 million of that pipeline is associated with post-quantum projects, including QS7001 and QVault TPM opportunities.
We want to be clear that this pipeline represents our estimate of potential commercial opportunity. It is not revenue, and its conversion will depend on customer qualification, product validation, certification, production schedules, integration, and other commercial factors. However, the pipeline provides an important indication of the level of customer engagement and the market opportunity that we are pursuing. We expect initial production revenue from QS7001 and QVault TPM in the fourth quarter of 2026, with larger contribution expected to begin in 2027, subject to the normal risks associated with production ramp-up and customer deployment. Moving on to SEALQuantum and Quantisimo, we also continue building the SEALQuantum Sovereign Vertical Stack, which is designed to create an integrated technology architecture expanding from cryptography root of trust and post-quantum semiconductor through photonics, quantum computing, and secure infrastructure.
The strategy is to support by a targeted allocation of $200 million of SEALSQ internal capital resources. During the year, SEALSQ completed its acquisition of Miraex in Switzerland, adding quantum photonics interconnect technology to the stack. SEALSQ also made a lead investment of approximately $50 million in Quobly on the $150 million Series A financing and subsequently entered into a $5 million commercial agreement with Quobly. In addition, SEALSQ has invested a total of $7 million in EeroQ, a U.S.-based quantum computing company. A major majority investment in Wecan Group. Through Wecan, we are working to advance the next generation of the co-pilot compliance solution and explore the integration of post-quantum financial secure capabilities. Together, these assets complement WISeKey and SEALSQ on semiconductor, PKI, digital identity, and trusted infrastructure capabilities. The WISeKey Quantum Root Key is a central element of this strategy.
It extends the root of trust that WISeKey has operated under the OISTE Foundation governance model since 1999 into the post-quantum and quantum computer era. We are integrating this common quantum-resistant trust layer across the SEALQuantum ecosystem, from chips to qubits. In June, WISeKey and SEALSQ established Quantisimo Group and signed a non-binding letter of intent with GigCapital8 regarding a potential business combination intended to create a Nasdaq-listed quantum technology company. Quantisimo is designed to combine selected technology and investment development through the SEALQuantum ecosystem into a focused platform covering quantum computing, photonics, quantum secure infrastructure, quantum pure-play, and related technology. The proposed transaction remains subject to definitive agreements, regulatory review, shareholder approval, and customary closing conditions. We currently target completion of the first quarter of 2027, subject to the satisfaction of those conditions. Now let's discuss WISeSat and QSOC.
Our secure spaces strategy also continue to advance. WISeSat is progressing towards becoming an independent listed space technology company through its proposed business combination with Columbus Acquisition Corp. The transaction is expected to result in a Nasdaq-listed company subject to completion of the transaction on all requirements, approval, and closing. At the International Space Summit in Paris early this month, WISeKey, SEALSQ, and WISeSat presented our combined commercial Quantum Spatial Orbital Cloud or QSOC initiative. QSOC is intended to combine the WISeSat satellite constellation with SEALSQ post-quantum semiconductors, PKI and quantum random number generation, and digital identity technology. The objective is to create a secure and sovereign orbital infrastructure serving governments, defense organization, financial institution, critical infrastructure, and enterprises. The current roadmap contemplates a progressive deployment of up to 100 satellites through 2033. The platform is designed to support secure communication, quantum-generated trust, and post-quantum identity services.
The initiative demonstrate how our technology platforms can reinforce one another. WISeSat provides the satellite infrastructure, SEALSQ provides the quantum-resistant security hardware, WISeKey contributes digital identity, PKI, and root of trust. Together, they support a different shaded secure space architecture. We are focusing on building a sovereign infrastructure. As we have announced via our news releases, we have made substantial progress in building sovereign post-quantum semiconductors and cybersecurity capabilities in Europe and the United States. Just a couple of weeks, WISeKey, SEALSQ, and the Republic of Canton of Jura in Switzerland signed a memorandum of understanding to work together to a proposed post-quantum semiconductor and cybersecurity center in the Canton of Jura, Switzerland. The initiative has an indicated investment of approximately CHF 40 million-CHF 60 million over six years.
It is intended to provide Switzerland with capabilities to design, personalize, test, and securely provision next-generation post-quantum semiconductors, beginning with the QS7001 Quantum Shield. The project is designed to create skilled employment, support Swiss technology sovereignty, and strengthen the regional ecosystem around secure semiconductor and cybersecurity practices. The Jura initiative builds on our Quantix Edge project in Murcia, Spain, announced in several locations, where WISeKey and SEALSQ are developing sovereign semiconductor design personalization and cybersecurity capabilities. We view Murcia and Jura as an important hub for the WISeKey and SEALSQ Quantum Highway, linking trusted infrastructure capability across regions. We are also establishing the Geneva Quantum Center of Excellence at our headquarters in Pont-Rouge in Geneva. The center is intended to provide an end-to-end demonstration environment for customers, government, technology partners, regulators, and investments.
It will bring together our quantum computer, post-quantum service security, semiconductors, digital identity, satellite, robotics, and artificial intelligence technology in one physical environment. This will help demonstrate how the components of our ecosystem work together in practical use cases. Moving on to our corporate structure. Finally, we have made important progress towards simplifying our corporate structure and strengthening access to the U.S. and international capital market. On September 9, shareholders approved the re-domiciliation of WISeKey Holding company from Switzerland to the British Virgin Islands, along with a related merge agreement. The new parent company has been renamed WISeQey, with [Q-E-Y], Corporation, WISeQey. As the news release issued this morning, the re-domiciliation become legally effective today.
WISeQey ordinary shares are expected to become trading directly on the Nasdaq global market and the SIX Swiss Exchange on or about October 5, under the ticket WKEY, with SIX expected to remain the primary listing. This structure is intended to streamline our U.S. capital market presence by replacing the existing ADS structure with ordinary shares trading directly on the Nasdaq, while maintaining our Swiss operational headquarters, management presence and international footprint. Over time, the group intends to provide greater visibility, accountability, and a strategic focus for each of its major technology platforms. WISeQey as the parent company overseeing root of trust, PKI, a digital identity business. SEALSQ as the post-quantum semiconductor and secure hardware platform. WISeSat as the secure satellite and space technology platform, subject to completion of its proposed transaction. Quantisimo as the potential quantum technology platform, subject to completion of its proposed transaction.
The goal is to enable each business to proceed its specific market opportunities while maintaining the technology integration that differentiates the broader group. Before opening the floor to questions, I would like to emphasize that WISeQey is building on a strong first half as we execute through the remaining of 2026 with solid revenue growth, a substantial liquidity position, increasing engagements with our post-quantum products, and meaningful strategic progress across semiconductor, quantum technology, secure space, and sovereign infrastructure. We are now focusing on execution. That means converting commercial opportunities into revenue, bringing post-quantum products into productions, completing our planned transaction and corporate structure initiatives, and continuing to demonstrate the value of the integrated trusted infrastructure ecosystem we have built.
From silicon to qubits, from digital identity to artificial intelligence, from Earth to space, our objective remains unchanged: to provide the root of trust for the next generation of the digital economy. Thank you for your time and interest in WISeKey. Operator, we are now ready to open the call for questions.
Thank you. We will now be conducting a questio- and- answer session. If you would like to be placed into question queue, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing star one. One moment please while we poll for questions. Our first question today is coming from Matthew Galinko from Maxim Group. Your line is now live.
Hey, thanks for taking my questions. My first one is on the pipeline for repeating what you have done with Quantix Edge. Is signing and progressing on that agreement a helpful validation point as you negotiate in other regions to bring additional of those types of programs to fruition?
Yeah. Hi, Matt. Nice to talk to you. Yeah, absolutely. I mean, the concept of creating those personalization center, it was a very early concept that actually started even before all the current discussion about sovereign technology and the fact that countries want to control the entire supply chain process of basically manufacturing and, in some cases, personalizing semiconductors at national level, especially now with the post-quantum requirements, and they are coming. The first port project in Murcia, it is a joint venture on where we invested EUR 10 million. The Spanish government invested EUR 20 million, and a local startup invest EUR 10 million. This product is already generating revenue for us as they buy our technology, they buy our chips, they buy our machines. We actually designed the clean room and all the process required to personalize the chips.
This experiment that we didn't know how that will play is actually playing very well, and it's become inspirational for many other countries. Jura is the next one that they want to move into semiconductor. I mean, what is happening in many of these hubs like Jura. Jura in Switzerland is very well known for being one of the watch manufacturing job hubs on the country. Obviously, watch manufacturing technology needs to be projected to the future. The skill sets are there, but they need to enter into the digital era. Semiconductor is the normal extension of that. That's why we signed with them. Similar projects are in preparation in the United States. We should be able to give more information in Q4. For the same reason, right?
The United States wants to be also self-sustainable and independent in what concerns the next generation secure semiconductors with post-quantum capability, because this is now a requirement by the U.S. government on the PQC, as it's an executive order on President Trump that says that critical infrastructure in the United States needs to be PQC compliant and resilient by the year 2030. This is actually tomorrow. We will very soon be able to announce progress in the United States on that initiative, which will be obviously much bigger than what Jura or Murcia are, because the country is much bigger and the economy is much bigger.
Yeah, investing money one side, creating local infrastructure, then it becomes sovereign, and that reinforces our trust model and allows us to sell more chips and more technology on national level, which otherwise would be impossible to reach out because they would prefer to have a local player.
Got it. Thank you. As a follow-up to that question, and we've talked about this, I think, in the past, but you have a bigger balance sheet today than I think when you proposed the Quantix Edge project in Spain. As you work towards bringing more of those sovereign type projects to fruition, do you look to have a bigger economic interest in the projects now that you could potentially put more capital in? Or is that not necessarily the direction you'd want to take with your investments?
Yeah. Absolutely. As you know, many technology companies, like NVIDIA and others, they are creating, in some cases, the market for their own products by investing in centers like that. The same logic apply for data centers, right? Where companies invest in data centers with the objective to have the data center acquiring GPUs from the company. The same thing applies to semiconductors. The fact that SEALSQ and WISeKey are sitting on a very important cash position, and those projects are not that expensive. We are talking between $40 million-$50 million per country. It will allow us to localize a few of those centers around the world, and we are also looking in South Korea. We are looking in Japan, where we have a good track on the demand on semiconductors.
As soon as we enter into a full PQC era, which should be next year, there is going to be more and more demand for that. This is one of the reason, by the way. As you know, WISeKey is trading a very low valuation. Their enterprise value is very low. The group has 10 times more cash than valuation in some cases. So obviously, that will rectify as well the value of the group, right? As you will be consolidating the revenue generated by those entities. This is one of the reason as well where the WISeQey, replacing the K with a Q to reflect our commitment to quantum technologies, and listing the company directly into the Nasdaq as a way to correct the historical limitation we had in Switzerland by being only a Swiss-listed company with an ADR in the U.S.
All those actions that took a huge amount of effort by the company, the management, and the staff is reaching now maturity, and this is going to create a very interesting scenario where this enterprise value will more and more be recognized by the market.
Thank you. If I could sneak one additional question in. I think you highlighted an interest in growing your constellation to 100 satellites. Can you maybe fill in a little bit on who you see as launch partners to get that out there if there is sufficient launch capacity in the coming years to build that sort of size of constellation and just what are the dynamics you are seeing?
Yeah. We started three years ago launching satellite, low orbit satellites. We did it with SpaceX, which is our predominant launcher. SpaceX is actually working with us strategically also as this model of constellation is actually very interesting because it is both a sovereign constellation of our own satellites, and at the same time allows us to be interconnect with existing satellite in other constellations, right? Our position in the space is not to have thousands of satellites, but to make the existing satellite more secure, to render them PQC compliant, to create national sovereign hubs, where, for instance, one country could use a number of satellite, which will be enough for them to coverage their own territory, but in a mixture between a private constellation versus a public constellation like a Starlink.
We are also diversifying or launching projects by teaming with companies like Skyroot in India, which they just launched their own rocket, or PLD in Spain, which is another rocket company. Those are a small company, obviously nothing to compare with SpaceX. But in some cases, this industry, space industry, is becoming also very sovereign industry, and there might be situations where country will prefer to use their own launching capability. But our focus again is not sending rockets, or our focus is not having thousands of satellite. Our focus is actually to bring the cybersecurity that we have been implementing on Earth for many years into the space, and this is where WISeSat, and very soon to be a Nasdaq-listed company on its own right, is building that layer that is not operational in our days. Current satellites have very little security.
They are non-PQC compliant, means that with a quantum attack, you can just shut down many of those satellites and create a huge disruption. So that is our focus, and there is going to be many strategic partners that they are slowly coming because they want to add their services to this type of secure satellite constellation that we are building.
Thank you.
Thank you. We have reached the end of our question- and- answer session. I would like to turn the floor back over for any further closing comments.
Thank you very much for your time, and if you have any other questions or information, you can always email to us or go to our investors website where you will find all the documents and presentations. We would like to thank for your attention, the moderator also to organize this call, and the IR agency to put this in place. Thank you very much, and we look forward to be in contact with all of you very soon.
Thank you. That does conclude today's teleconference webcast. You may disconnect your line at this time, and have a wonderful day. We thank you for your participation today.