Where a limited number of attendees will have the opportunity to raise their hand and ask questions live. We will then move on to a number of questions submitted in advance by our investor community. I now hand you over to Beam Global's President, CEO, and Chairman of the Board, Desmond Wheatley.
Hey, Luke. Thank you very much for the introduction, and thank you to all of you who are tuning in today to hear this, what I think is probably one of the most important webinars that we've done in our history. I'm certainly looking forward to it, and I'm looking forward very much to sharing information with you about the company today, Beam Global today, where it is, and the evolution of the company. Then, of course, what I think everybody wants to know and understand is more about this acquisition that we have in process at the moment of ScoutDI, which is, from my point of view, absolutely the perfect next step in our evolution. I hope you'll come away from this webinar sharing that impression with me. Without further ado, I'll move here.
You can all have a quick scan through the forward-looking statements here. Let's start here just looking at Beam Global and our history, because it's interesting. We've evolved a lot since we started out back in the third quarter of 2010, making the world's first fully autonomous off-grid solar-powered electric vehicle charging station. You can imagine back then, that was a tough way to earn a living. There weren't a lot of electric vehicles on the road at the time. In fact, we went through a sort of an eight-year desert, basically, while we waited for the electric vehicle adoption rates to pick up. So really for that first sort of eight to almost 10 years, or even more than 10 years, we were fully engaged and entirely immersed in making these off-grid electric vehicle charging stations. Fantastic product.
We still sell an awful lot of them today. I think we're going to sell a lot more of them in the future as well. So this is a space that we're still very actively involved in, and we're going to continue to be involved in that. I think electrification of transportations is absolutely a certainty. It's inevitable. I travel a lot, spend a lot of time in Europe and in Africa and in the Middle East, and the adoption of electric vehicles over there is absolutely phenomenal. In fact, Norway, where I've just been as a result of this transaction we're working on right now, something like 98% of new vehicle registrations are electric vehicles. That's going to be a global phenomenon, and I think we will see an awful lot more activity.
Certainly a little depressed in the U.S. at the moment, and that's part of the reason, only part of the reason, but it's part of the reason that we have been taking diversification steps over the last couple of years, because we want to have more opportunities to bring value to our customers and to our shareholders. in 2022, we made our first acquisition. I have to tell you, at the time I did that, I wanted to get into the battery business largely because there were supply chain worries at that time. We were worried we weren't going to get enough batteries. Of course, all of our products generate and store their own electricity, and you need batteries to do that. We were a little worried that we weren't going to be able to buy batteries to do that.
Batteries are about a third of the cost of our EV ARC™ product, for example. I wanted to make sure that we got that margin in-house. So we acquired AllCell Technologies. We'd been using the technology itself for about a decade, so we were very confident in its capabilities and its unique nature, certain of the attributes which are absolutely unique. That was a really good move for us. We were able to defend our supply chain, recapture some margin. You will have seen that improve margins at the time because we were putting our own batteries into our products. It also got us into a whole lot of other interesting spaces. AllCell has evolved since we've owned it. It's now Beam's energy storage business.
We're now putting batteries in drones, robots, medical devices, all sorts of mobility, submersibles, and even, frankly, top-secret weapons now. Furthermore, we're developing some fantastic battery technology for the AI data center revolution. There's a lot of talk about grid-scale, utility-scale batteries for data centers, but not so much talk about really energy dense, high-speed discharge, high-speed charging batteries for the extreme demands of AI and data centers. That's what we're really good at. We're in the process of developing those products now. So this is a fantastic acquisition for us. We've got some brilliant people. Said Al-Hallaj, he was the founder of AllCell. He's still with us, one of the world's preeminent battery scientists, and his whole team headed up by DJ Gilmore and others there, engineers, scientists, and manufacturing capabilities in Chicago, Illinois, making batteries.
That was probably the beginning of our sort of diversification of products, where we weren't just making solar-powered EV charging stations. All the way back in 2022, that started. In 2023, I executed on my aspiration to make us more of a global organization. Great thing about our products is they work anywhere they can see the sky, so there was no need to limit ourselves to the United States or North America. With that, we acquired Amiga. Wow, talk about product diversification. We immediately, amongst other things, became the fourth-largest streetlight manufacturer in Europe. That might sound kind of boring to you until you remember that streetlights are powered hardware every few meters down a street to which we can add intelligence, generation, battery storage, EV charging, and all sorts of other things.
That's the mission that we've been on wholeheartedly since that time, firmly moving us into the kind of smart cities area. You can now see this kind of three-legged stool developing where we are involved in the future of mobility. We're involved in energy storage and generation, and we're also involved in this kind of smart cities infrastructure, adding intelligence to the built environment. The other thing that Amiga brought us, 35 advanced degree engineers, a fantastic factory facility in Serbia where the economics are very good, the people are very well educated, very great work ethic there, good English qualities, speaking qualities that is. We really expanded dramatically. In fact, our capability in our facilities over there are superior to those in our U.S. facilities. We're more vertically integrated in Serbia, and the economics are much better there.
Much so, by the way, that absent tariffs, we can make our EV ARC™ product, for example, in our Serbian facilities and ship it to a customer in San Diego less expensively than we could make it in San Diego and ship it to a customer in San Diego. Just a fantastic team of people headed up by Ivan Tlačinac, who runs our Beam Europe operations now. A very talented guy, and a great operation over there, doing a whole host of things, but also capable of building all of the products that we've developed in-house and patented in-house. Those products, by the way, are comprised of our own in-house manufactured components and other people's off-the-shelf stuff.
For many years we've been buying power electronics, and prior to our AllCell acquisition, we were buying batteries from other people, but we're still buying a lot of power electronics from other people. In 2024, we acquired Telcom, which is a power electronics company. Same impact with us. We were immediately able to become more vertically integrated. In the same way that we produce bespoke batteries for our products, we're now producing bespoke electronics for our products, defending margin, improving our products' capabilities, and enabling us to have a much tighter control over that whole process. Again, Telcom brought us other products, other services, and other customers, just as the Amiga acquisition did and just as the AllCell acquisition did. You can see what's happening here. We've got this geographic expansion.
Now we're heavily in Europe, and you can see that we've got this product portfolio expansion. All the while, by the way, we're inventing new products across the company as well. We went just from being an EV charging company. Now we had electric bike products, we've got law enforcement products with motorcycles. We've got, as I say, batteries and weapons and drones and all sorts of other things. We're becoming a much more diversified and broader platform as a result of, A, the acquisitions that we're making, but also our internal and organic development of new IP. We are at heart a product development company. We're really good at creating products which are focused on the most compelling and absolutely current opportunities of the time. Those are the future of mobility, no question about that.
Energy storage and generation, also incredibly important in the era that we're living in, and then this idea of bringing intelligence to the broad built environment. We're producing all of those things now, many of them with patents, many of them with our own invented and engineered products. Absolutely current and very compelling opportunities, and we're very well equipped to go after those, both in the Americas and in Europe. In the fourth quarter of last year, I have to say my timing wasn't brilliant on this one, but in the fourth quarter of last year, we opened Beam Middle East. This is the first thing that we did which wasn't wholly owned by Beam. This is a joint venture with the Platinum Group, chaired by a member of the royal family in the UAE.
This was a fantastic move as well because it got us into the Middle Eastern market, the Gulf states that have already committed spending over $1 trillion on infrastructure, just like the products that we make. They're really into future of mobility, they're really into non-traditional sources of energy and energy storage, and they're really into technology in the built environment. In many ways, more advanced than we are here in the U.S., but a really strong appetite for products just like ours. So that's a fantastic opportunity for us, a trillion-dollar market there. And of course, a gateway to Africa. Africa's another place that has a great set of opportunities for us because at the moment, it's more or less a blank sheet of canvas where energy and transportation infrastructure is concerned.
I happen to believe that they will move to all-electric vehicles, and they're going to move to energy infrastructure, which is not like ours, centralized power stations, transmission, and distribution infrastructure. No, they're going to be much more concentrated on having energy generated and stored at load in a really disintegrated, and diversified manner. And of course, our products are perfect for that. I know this, by the way, because I've been to Africa, spent a good deal of time there. I know what the market demands are there, and you're going to see us getting a lot more active there.
It is unfortunate that our timing on the Middle East, certainly because I wasn't anticipating the war there, and I can tell you that that has pretty much ground things to a halt, across the board in many instances where investments in new infrastructure and that sort of stuff are concerned. It will come to an end. I don't know when, I don't know how, but it will come to an end. And when it does, we will be well-positioned to take advantage of that huge and very vibrant market. That brings me to the right-hand part of this timeline here, and this is this acquisition of ScoutDI, for which we signed a share purchase agreement last week and announced it, or the week before and announced it then. This is really the icing on the cake.
It's a very appropriate and absolutely ideal evolution of everything that you've already seen on this. You can see we've been acquiring technologies, we've been inventing technologies, we've been advancing geographically and expanding geographically. We're ideally positioned to move into this drone space, and I'll get more into more detail on that in a second. What you have now is a Beam Global, which for many years has been viewed as a solar power EV charging company. In fact, what we are is a technology platform, a sustainable technology platform with fantastic IP around infrastructure, with fantastic IP around energy generation and storage, with fantastic IP around mobility of all sorts, and integrated into these tremendous markets that we're in right now. As I say, this acquisition, just the icing on the cake.
It's the perfect and most appropriate thing that we can do from an evolutionary point of view. Let's talk a little bit about why in a minute. Before we do, just continuing on the snapshot here, Beam Global today. We've got about 227 employees globally. Lots of engineering, lots of scientific, really clever people. I'm just clever enough to recognize that I need to have much smarter people than me around doing all this stuff. We have manufacturing facilities in California, Arizona, Illinois, and then in Europe, of course, we have two facilities in Belgrade and Kraljevo. Recently we have opened up, as I mentioned, our Beam Middle East offices in Abu Dhabi. Of course, soon we'll be in Norway.
If you look at the map on the right there, if it's green, we have product there, and the red dots kind of show you where our facilities are. So very much a global organization, very well organized across that global organization. Lots of fantastic communication. This is not a roll-up where we keep all entities separate. Everybody's wearing Beam uniforms, everybody carries Beam business cards, and everybody's talking to each other across the time zones and across the continents, every day, developing products, manufacturing products, and selling products across the world here. No debt at this point, although I will change that with this acquisition, and $100 million on our line of credit, which is still untapped and still very expensive. Our products are made in the U.S. for this market. So we've got that Made In U.S.
thing, BABA-compliant products, and they're made in Europe for the European and Middle Eastern and African markets there, which works really well for us because the world's kind of polarized politically at the moment. Geopolitically, people aren't talking to each other as much as they used to, and it's very useful to be able to let each market know that they're getting these fantastic products, but that they're not importing them from somewhere that maybe they don't feel as enthusiastic about as they did a few years ago. Now they're able to say, "Okay, this is great. This is a locally produced product. We feel comfortable buying it." That's a really important aspect.
That is going to be absolutely vital to our drone strategy, because most nations do not want to be importing drones from other people, because drones are kind of like a physical embodiment of AI. They are gathering and sharing a lot of data, and people just don't want that coming from offshore. So our ability to manufacture drones in the markets, the biggest markets, U.S., Europe, the Middle East, even down into Africa, and have them be relatively locally produced is going to be a major differentiator from us. We are publicly traded, of course. Part of the reason I am having this call, and our stock is pretty liquid. We traded about 30 million shares today, although that is a lot more than normal. We typically average daily volumes around 1 million shares a day. But today we traded 30.
I am going to talk to you about that at the end of the presentation because something really interesting happened today, and I want to share that with you and hear your ideas around it. Then just finally, revenues. Often we have been accused of being a government shop. Actually, our revenues are about 50/50. There have certainly been some years where the U.S. federal government was our largest customer. U.S. Army is our biggest customer by far historically, Marine Corps in the top 10, U.S. Navy, Space Force, many others. Of course, all of that has come to an end in January of 2025. The new administration, less enamored with electric vehicles and sustainable energy and those sorts of things, put a stop to those types of acquisitions. But look at how we reacted and responded. This is a pretty good indication right here.
2026, third quarter revenue up 8% year-over-year. So even though we lost this massive customer opportunity with the U.S. federal government, I believe we will get it back. They still have the largest fleet in the world, 670,000 vehicles. They will all have to electrify. There is no question about that. It doesn't matter who is in the White House. When they do, we will see them again. Only next time with more urgency. So that will be great. But even without that, even having lost what was sometimes as much 70% or 80% of our annual revenue, look at what we are doing. This is the core business. This is without the drones.
Beam Global is a good company. We are operating well. We are executing well. We are well-managed. We are tight. We are growing the business, even absent some very large customer opportunities. Which, as I say, will return.
The great thing is that when they return, we will have all these other foundational expansions that we have created over the last couple of years. So that return of the federal government and the U.S. buying of electric vehicles and infrastructure will be accretive to this new platform that we built, this technology platform that we have developed over the last couple of years very deliberately. Okay, if things are so great, why are we acquiring ScoutDI? Let's go through that. Well, first of all, this is the clearest thing. Drones are already absolutely in our DNA. We have for a long time been making batteries, in particular, for some very famous drone manufacturers. Unfortunately, most of them are pretty secretive about where they get their battery technology. They are not inclined to allow us to share who they are.
We're putting batteries in drones in the air, on the land, on the surface of the sea, and under the water. We've been doing it for years. Not just drones, but these are all kind of drones. Robots, material rehandling equipment, and all sorts of other stuff. We've been doing this for a long time. If you like to think about the computing and the software as the brain of the drone, the batteries are the heart. A drone cannot operate without that heart pumping well and reliably. We're really good at making very energy-dense, very safe, very robust, and bespoke batteries that can go into all sorts of different form factors, which is a key differentiator for us. You can see on the chart here, aviation, maritime, and ground mobility, and industrial applications. We've been doing this for a long time.
Actually, we're already in the drone space. We have been for a long time. It's absolutely appropriate that we would be advancing our position in that space. What's great about the Scout guys is this company is a company that was founded by engineers. They're people from the industries that they're focused on right now. These are not sales and marketing guys. They've done a great job, as you'll see the kind of customers that they have already. That's not been their focus. Their focus has all been on engineering, product development, software development, AI advances, and everything else. We're going to be able to take that fantastic technology solution, proven technology solution, and we're going to be able to make it global. We're going to put it through our sales and marketing organizations.
We're going to introduce it to our existing customers, like the U.S. Army, like the U.S. Navy, like our oil and gas customers, like our maritime, our mining customers, our agricultural customers. We're going to put this technology in these people's hands and manage to massively scale the Scout opportunity because the underlying technology, the underlying products are so powerful and so good and so differentiated from the competitor stuff out there. I know that because I have already pitched these products to very large existing customers of Beam Global's and had them say in the beginning, "Look, we already know all about drones. We do drones.
We're drone experts." Then I showed them what the capabilities of the ScoutDI products were, and they were like, "Hang on, we've never seen a product that can do this before." There are some really significant differentiators about the product, I'll talk about that in a second, which were exciting enough for them to say immediately, "Okay, send us systems. This is different enough to where we've got to know more about this, and we've got to learn how to use these things." So a great scaling opportunity for us here. Another reason that we're buying ScoutDI is because although in the drone business today, and all of you will know this, there are broad variety across the spectrum drone companies, all the way from kind of vaporware on one end of the spectrum up to really quality and qualified companies.
Well, Scout is absolutely on the quality qualified end of the business. This is a real company. This is a company with proven technology. This is a company with top-quality customers. Look at Exxon, Chevron, Shell. They could buy anything they want from anybody. They mostly often get it for free, probably more often than not, and yet, they're buying the ScoutDI technology. So these are proven products. They have operated in the absolute harshest conditions you can imagine, and with a software package, which is pretty much unparalleled in its capabilities, and unrivaled in its capabilities. That's why these very excellent customers are coming to them and acquiring the product. I hope you guys read the press release this morning. Absolutely unbelievable new order that we've received, the order books filling up, which means that Beam's order book is filling up from these technology point of view.
Again, the reason for that is not because of the charm in the sales team, it's because the product is so absolutely compelling. More than 7,000 inspection flights already completed, again, in the most harsh environments and with an international customer base. Talk about just some of the differentiators about the product. They have developed a tethered drone, and that's because, first of all, drones are very limited in their air time because of battery technology. Most of the drones who are doing inspections, their competing drones who are doing inspections, are only able to stay in the air for about 10 minutes. This product has an unlimited flight time. By the way, it's powered by a battery pack that ScoutDI already makes. They're using third-party batteries.
Now, of course, as soon as we acquire them, we will immediately go to work replacing their batteries, that they're buying from third parties, with our own. So this will be a Beam fully vertically integrated solution, the airframe, the software, and also the batteries powering it, whether that's down the tether or actually attached to the airframe itself. Stable power is really important because if a drone runs out of power, it crashes. You've then got to go and retrieve it, and in a lot of environments where these things are flying, you do not want to be sending human beings in there at all in the first place. That's part of the reason that this is such an important technology and a successful technology. Then getting data over the wire is a big deal too. As you will all be aware, intercepting drone data is really important.
There are two things you can do if you can intercept that. First of all, you can cause the drone not to complete its mission. Secondly, you can intercept the data they're sending back to the operators. Neither of those things are good, certainly not in a warfighting environment, but it's also not good in an industrial environment either. We don't have that to worry about. There's no RF signal to interfere with, and so that's part of the reason that's such a perfect product for cybersecurity, for defense-type applications, but again, also for these industrial ones. Then this ability to fly in a GPS-denied environment. Most drones require sight of a satellite, so that they know where they are and they can navigate safely and do all that sort of stuff. We don't need that. We're able to fly in GPS-denied environments.
That means we can go down inside really complex environments, steel environments, and really tough places. Places that frankly no other drone can navigate in those circumstances, and this drone does a perfectly good job of that. Don't think of that as a limitation. That is actually a really good thing right now, because we are able to replace that tether with a battery pack and a radio, because Beam already has those technological capabilities, and change the parameter of the device, and therefore massively increase the opportunities that we can go after. It is a fantastic product, already doing really difficult work that lots of other people cannot do. We are able to expand that, and we certainly will. Look, it is not just about hardware.
In fact, I would say equally, perhaps more important is the software that Scout has developed, the Scout Portal, because these things are producing massive amounts of data. As we all know, when you have too much data, what do you do with it? How is it useful to you? Well, in this instance, the software is doing all the work for you. This is an AI-enhanced inspection software that is mapping. We have gas sensing. We are sniffing the air. We are able to tell how thick or thin the steel environment is.
Just imagine for a second, an oil tanker. Oil tankers traveling all over the world at the moment, and they have work hardening from movement, they have corrosion, they have all sorts of stuff. They have to be inspected very regularly. Well, the way that that has been performed up until now is teams of human beings.
I am not talking about one person, I am talking about teams of human beings have gone down inside these. You have to clean them, you have to degas them, you have to build scaffolding. You are talking about five or six people for days or weeks going through and doing the inspections.
This drone does all of that in two or three hours, and without putting anybody at risk, and it produces far more accurate data and far more useful information. They are not people down there with tape measures and that sort of stuff. No, this thing is down there creating a virtual digital twin of the environment that it is in, and it is even able to go up against a steel bulkhead and test the thickness of that steel. How much corrosion is there? Is there cracking in the welds? Is there anything else going on? Just an incredibly powerful product.
This recurring revenue source that we get, this is a growing source of revenue. It is recurring revenue, and the recidivism, the retention rate for the clients is fantastic. It is pretty much maximum retention rate there. This is a constantly growing and very high margin, recurring revenue stream from the data that these things are producing for anybody that owns it.
Now, if you are interested in how we do it, we are using LIDAR, we are using ultrasonics, we are using a whole lot of different things, and all of this tied together with an AI-enhanced software. Put these two things together, talk to you about Beam, what we have been up to, talking to you about what ScoutDI has been up to. You put these two companies together under a single strategy, you can immediately start to gather the power of this. We are going to get them a massively increased audience.
We're going to get them into the U.S. through our GSA contracts, our Sourcewell contracts, our existing relationships with federal, state, municipal government customers, but also with all our commercial customers in the U.S. We have thousands of products deployed now for hundreds of customers across the U.S. of all different shapes and sizes, and government and non-government. We're going to get them in front of them. We're also going to immediately start manufacturing the drones in the U.S. That is very important because Scout has a Pentagon FCC approval for their drone, but it's conditional. The condition is that the drones have to be manufactured in the U.S. We're going to solve that immediately post-closing.
We will start to manufacture the drones here in the U.S., so that Pentagon approval that's already been given, but conditioned upon onshored U.S. manufacturing, solved as a result of this acquisition. We're also going to maintain our European manufacturing, because as I say, there are other customers around the world, and Europeans, they don't want to be buying American drones, they want to be buying European drones. We're going to maintain our European manufacturing and solve the same problems in those. By the way, we will also maintain Scout's facilities, although they will increasingly become for product development. We'll be doing the mass production in our existing facilities. I'll talk a bit about that in a second. Then, of course, we're going to take them to the Middle East as well. I've already done that.
I've already pitched the product in the Middle East to a very well-known, very large customer, and they were one of them that said, "Hey, we've never seen these capabilities before. We need these things right away." We've got good financial discipline at Beam and a history of execution, even under the toughest circumstances. Our battery capabilities, our radio controlled and power electronics that go beyond the tether will allow us to dramatically enhance and expand the product offering based upon this really fantastic core technology that we're acquiring. As I said already, we've got thousands of existing customers, and what's cool about those customers, the same type of customer that have been buying Beam's existing products, they're usually the same departments or very close to the same departments that buy drone products if they're going to do that.
We're in a brilliant position right off the bat to take this technology. Report from all the customers that we have, or we're going to look at those with Scout and we're going to say, "Okay, who should we call first?" Because we already have contracts in place with many of these people, we're already in a good position to go and chat with them. All the cold calling's out the window. That's another brilliant differentiator for us. In the meantime, Scout is going to bring to us this proven airframe and this advanced sensing technology and incredible software package. As I said, we've already been in the drone business for a long time, making batteries and even a patented recharging product for drones, but we've never had the airframe and the software. We're going to have that now.
That's a perfect and ideal advance for us, and an evolution for us. Scout, as I said, this is a very real customer. They already have 83. A company, rather. They already have 83 customers across 31 nations. Many of those overlap with the nations that we're already in, but we're going to get a few new ones. We're going to be able to go to those customers, market our products, the existing Beam products, but also help Scout be even more capable of meeting those customers' requirements, particularly where scaling is concerned because of our existing factory facilities. Scout's also in very good standing with DNV and ABS, American Bureau of Shipping.
These are the actual entities that tell you what kind of inspections you have to do and how you have to do them, and they're already big fans of the Scout product, so that's going to be very helpful for us in the entire maritime oil and gas industry, including U.S. Navy and others. The fact that their products are already used in these very demanding environments, nuclear facilities, please check out the press release we put out this morning. It's phenomenal. Oil and gas, mining, and just really great opportunities. The marriage of these two things, our existing sales and marketing organization, their existing customers, our technology and capabilities, their technology and capabilities, the two things coming together is definitely one of these instances where the product's going to be worth way more than the sum of the parts here post-acquisition.
Everybody's very interested to know how the deal's going to work, and I get that, of course. This is a big transaction for us. Mostly it's a big transaction because of where our market cap is right now, and our market cap is certainly not a reflection of our operations. We're 1,000xx the company today that we were when we were trading at $75 a share back in 2021 or 2020, whenever it was. So three-quarters of a billion-dollar market cap back then, and we're vastly improved, as you can see from the timeline. The market has its way of dealing with things. It's not always rational, and it certainly is not a reflection of our operations. But it's still, from a market cap point of view, this is a big deal. $24 million purchase price.
The first thing I want to tell you about that is that's not what they wanted. We've been involved in negotiations for a long time. We've had to really help each other understand why this is a good move for growth and for everything else because frankly, we're acquiring this company for a much lower multiple of revenue than many other drone companies out there. Again, a lot of them are vaporware. This is a real company with a real product, and we're getting this for a very attractive multiple and valuation right now. It's going to be a combination of cash and Beam stock. More cash than stock, I have to say. This is going to be minimally dilutive for us, and they do have the potential to get these earn-outs in 2026 and 2027 if they hit significant growth in revenue.
That's part to balance the fact that we've been able to come to an agreement for a price which was much lower than they originally asked for. There's always give and take in these things, and what we've done is we've given them what we think is realistic that we can do for the acquisition price, but we've given the potential to make more, assuming that they do really well. They're going to do really well because they already are, and we're going to help them do a whole lot better. Believe me, an earn-out liability is the best liability that an acquiring CEO can have because it means that your acquisition's working and you're getting the revenue and you're getting the margins and everything else from it.
From a point of view of how we're going to finance this thing, we have already in place all the non-dilutive cash that we need to, or commitments of cash that we need to handle the cash portion of this. That's no longer in question. Those are under terms which are acceptable to us and manageable by us. Otherwise, we wouldn't be doing this. We're also going to acquire them debt-free, but they will come with their existing credit facilities and banking relationships too, which we will inherit, and those are really good. That's going to sort of strengthen our financial economic outlook internationally, but without us bringing any debt on or anything else. That's a good news thing for us. I like the fact that the investors are coming along for the ride. These guys, this is not a fire sale. They're not bailing out.
No, they're going to become Beam Global investors. By the way, they're great shareholders. They're people who we would want to own our stock. They're long holders. We're really very happy that they're going to continue to be involved after the acquisition. Then the leadership team's coming. In fact, the entire staff's coming. There's no one on their staff that we don't want, and they're all coming with us. Okay. Something else that's really very useful about this and another part of the fantastic evolution, and the reason that the evolution is so good for us is that the drone factories that we're going to need in the U.S. and in Europe, they're already built.
Our existing factories in San Diego, Arizona, Illinois, and in Serbia already have the resources, they already have the infrastructure, and most importantly, they already have the skill sets required to build these drones. Because building these drones is very like what we already build. Electromechanical assemblies, structural assemblies, batteries, electronics. We're already doing all of this. We already have skilled people in-house that can do this, and we have factory facilities, which frankly, are underutilized right now, which can do all of this work. This is brilliant. We're in a position where we can bring the technology into our markets, both in the U.S. and Europe, without significant capital expenditure, without operating expense increases. We can do that because we have these existing facilities and these existing skill sets. Again, back to the beginning of the call and said this is the perfect evolution for us.
We're just adding more capabilities, more opportunities, but we're doing it without having to spend a lot of money on infrastructure and people and all those sorts of things. Remember that our gross margins, our unit economics at Beam Global are already very good. Our GAAP gross margins that we report are not often as good as we'd like them to be, and that's almost always because of overhead allocations, the burden of the overheads and the factories, the costs that we have there. Adding new revenue sources, adding new opportunities, reduces those overhead burdens per unit sold, which will increase our GAAP margins already. GAAP margins are already good, but they're going to get a whole lot better. The other thing, by the way, that's going to be really exciting about this is we have really very good product development engineering teams.
When we marry those with Scout, the evolution of the product, our capabilities in energy storage product development, marketing, and also when we marry those with their engineering teams, we expect to see a tremendous acceleration in the evolution of the existing product sets that they have, which again, are very well suited for lots of other tasks, not just the ones that they're already on. Of course, the most obvious one of this, I love this, Beam makes ScoutDI better, makes Beam better. A big part of that's going to be our batteries. We make really good batteries. They're very energy-dense. They're capable of charging and discharging quickly. The cost per energy stored is lower because the batteries last longer because of the energy density. Very importantly, they're safe.
We do not want a drone flying into an environment having a battery blow up, which can happen. Not with ours. One should never say never, but our technology is designed to prevent that sort of thing happening. Our sophisticated BMS architecture will allow us to make expanded uses and use cases, and the form factor and the fact that we're able to make batteries in all sorts of different shapes and sizes will allow us to make really cool batteries for all sorts of drones that we intend to develop moving forward for lots of other opportunities. The fact that we're already in the air, on the ground, and underwater, and on the water, doing the toughest tasks with drones and robots today makes us in a perfect position to really bring a lot of value to these future evolutions of what we're going to do.
Let's talk about that evolution. Today, the product is certainly very focused on doing inspections. The inspection market's absolutely massive, billions of dollars globally, and it's absolutely in its infancy. It's hardly even started where it's going to go. But take a look at these images here. The top set of images that you can see on the top row there, one of them is a video image coming back from the drone for FPV, first-person-view image coming back from the drone. The one to the right of it, the multi sort of green and blue one, that is the digital twin, the map that that thing's creating with incredible accuracy, by the way. Every dent, every screw, every nut, everything's being mapped in a way that human beings simply could not do with this degree of accuracy.
And again, doing it in a fraction of the time and for a fraction of the cost that the large teams of humans would need. But look at some of the other things that we know that this would enable us to do. The bottom two images, for absolute transparency, those are generated. We just made them up just to illustrate what we are talking about here. But because this drone is able to fly in complex environments without banging into things, it has a virtual fence around it. You can make that big or small. It will not crash into things. It will not crash into people, it will not crash into objects, walls, plants, or anything else like that. It just will not do it. I know. I have flown it. I tried to crash it into a wall, and it would not allow me to do it.
Well, that makes it ideal for doing things like package delivery onto the doorstep. We have a wireless autonomous charging solution, and we are working with various wireless autonomous vehicle manufacturers who want to do package delivery. And I can tell you what, they can get the vehicle to get to the curb outside your house, but they do not know how to get the package from the vehicle to the doorstep. This drone could be inside that van, pick up the package, carry it to the doorstep, drop it on the doorstep, go back to the van, and get another one.
Because of its existing capabilities, we certainly would have to change the payload a little bit, but what I am talking about is navigational and operational capabilities would allow it to do something that complex in a very safe way, and I am not aware of another drone out there that can do that. The picture to the right, that is mine inspections. This is mine operators all over the world. They would love to have very accurate mapping of the interior of their mines for a whole lot of reasons. So we are certainly going to go after that market.
The product, as it stands today, is perfect to do that. No different inspecting the inside of a tunnel than it would be to inspect some other part of an oil tanker. But here is the drone is perfectly capable of doing that, and we will be going after that market as well.
Dual use potential. Hey, look, if you can send this thing into an oil tank, you can send it inside a house. You do not need to put people at risk going into a house. You can send this thing in first. It will create a map. It will tell you where all the danger spots are, create a digital twin, and allow your operators to go in with safety moving down the road. Then the evolution of this, of course, is untethered as well. We will use our battery technology and our other capabilities, and we will make this thing able to do all the things it is able to do in these types of environments, just on a much larger, broader platform. But we will also make bigger drones, smaller drones.
We will use this platform and this technology to greatly expand these offerings, and again, do it from our existing facilities without having to invest vast sums on capital or operating costs. I mentioned earlier we have a patented recharging product for drones, unique and patented. This allows us to deploy like an EV ARC. No construction, no electrical work, no grid connection. You can put this in a forward-operating contested environment. Drone can perform its mission, and it can recharge without having to come back to the operator, which puts the operator at risk. It also allows people to have vast networks of drones operating. They can be dropping down and island hopping and recharging while they are doing whatever their mission is. We are bringing this sort of charging infrastructure. We are bringing this energy storage solution for the drone.
Scout's bringing the airframe and the software, and the combination of all of those things. Our history, 15 years of putting this type of infrastructure in the harshest environments and building these batteries and everything else. Scout's tremendous experience with airframes and the software. The combination of these things becomes a killer app and just without rival in the industry. What we end up with is one company and just a whole stack of solutions. Again, we are not turning our back on the mobility products. We are not turning our back on the battery solution. This is just accretive, additive to what we are already doing. But we are going to be in a situation where we make the batteries, the charging infrastructure, they have the airframes and the software.
We put these things together, and now we become a U.S. manufacturer with the U.S. markets, including the Pentagon approval and everything else, and we become a European manufacturer with that end market and with the Middle East and with Africa as well as opportunities for us. It really gets us away from just being a component producer into the drone space to now being a platform operator. And this fits perfectly with our overall strategy of creating a technology platform that goes way beyond solar EV charging. Remember all the way back on the left-hand side of that chart back there, what we started out doing in 2010 and did successfully, although with tough world without any customers for a long time. Very successfully in the early 20s. Massive growth at that time. And then this is giving us another opportunity to take another bite at that apple.
Would be remiss of me not to mention the fact that there was an executive order last year Unleashing American Drone Dominance. This is a requirement in the United States that American drone manufacturing is focused upon domestic supply chains, defense opportunities. These things should all be taking place in the United States. Well, of course, we are going to be manufacturing here. We will own the company, so it will be an American company. And we will have absolutely no problem going back to our existing customers, Pentagon, Army, and everybody else, and saying, "Hey, we have got a U.S.-manufactured drone with U.S. software stored in U.S. storage."
This is absolutely in line with Executive Order 14307. And so we anticipate a great deal of attention and opportunities coming from that. Most of you will already know as much about the size of this thing, but the drone market's a huge market.
You can see we're already in it. Ray Systems, a fantastic submersible drone there. That's a picture of me shaking hands with the CEO after we just signed an agreement to put batteries into that drone. Batteries in military drones are a major concern. We're really good at that. Of course, we have this great technology for going into environments that you just don't want to be putting human beings in for a whole host of reasons. It's expensive, it's dangerous, it's time-consuming, and we're going to solve for all of these things. Massive market. To date, $5.5 billion total addressable market. Even our actual specific market that we're going after, a couple hundred million right now, moving to a billion. That's without expanding into any of the other spaces that I've just described to you.
Again, the product, the technology is very capable of going into all of those other opportunities with minor tweaks, not massive investment, not long time. As I showed you in some of the preceding images, you can see we're pretty much ready to get into that as soon as we get this thing done. Just a couple of the bullet points here. At the moment, less than 10% of oil and gas assets are using this type of technology or any type of modern inspection. It's all human beings going around with tape measures and magnifying glasses at the moment and clipboards. That's a massive opportunity just on its own, and we have lots of customers in that space already. Our ability to go into these GPS and denied environments, and those types of complexities, very difficult to do that. Very difficult. I'm not a commodity guy.
I like doing difficult things and margining them. This level of difficulty is going to protect our position in the market and keep us where the margins are. Again, these numbers that you're looking at here are without all the other opportunities, hydropower, tunnels, sewers, mining. You can read as well as I can, and then a whole lot of other things that we're going to do as well with the technology. Now, okay, great. Drones are great. Market's great. How do you decide who you should have exposure to, which companies you should have exposure to? Well, I'll tell you what. Vista Partners just put out in October a very interesting article talking about the drone industry, talking about what's important about it, and they put five bullet points in there.
It said, "If you're going to invest in drone companies, there are five things that you should be looking for." I'm going to go through them with you right now. First one is the company should have revenue from delivered products. Okay, we have that with spades on Shell, Exxon, Chevron, all of those guys already generating revenue from existing customers, recurring revenue, repeat customers. So that's a definite tick on number one there. Repeat orders and production. No question about it. We have repeat orders, and we are capable of producing today in the Scout facilities to do that. As I said, we're going to be able to expand that dramatically across our existing factories without large capital sums and without large operational expenses. So definitely a full-on tick on that one. We just have manufacturing and supply chain.
There's a lot of vaporware guys out there, a lot of people talking about what they have. They've got renderings and images of how they'd like to. No, we're actually manufacturing these things today, and we have a built-in supply chain already, and that's a supply chain that we're going to enhance when we add Beam Global's buying power to that and our global reach. We're only going to reduce our cost to produce these things and be able to manufacture more of them. Not just manufacture them in Europe, but also bring that manufacturing here. That's another big green tick for us there. Margins, cash consumption, and dilution. Well, okay, certainly very good gross margins at ScoutDI. We already have good gross margins at Beam, and especially at the unit level. Unit economics are very good. Volume will help enhance those an awful lot.
Dilution, as I already mentioned, we're doing this transaction. We have most of it secured commitments with non-dilutive cash. Cash consumption, I don't have to tell you we're good at that. We've been absolute masters of financial responsibility since our beginning. Everybody here is over-tasked. Because we're all believers, we get on with it, and we do not spend money on things that don't make products, make products better, or sell products. That's a big green tick for us there, too. Then finally, direct drone exposure and diversification. What they're basically saying here is they think it's better to invest in companies that have other things going on, not just drones. Well, that is certainly us.
As I've already explained to you, we are going to stay in all the spaces that we're already developing success in, smart cities, energy storage, energy generation, mobility, future mobility solutions. We're going to keep doing that. I think that will only continue to be a massive growth engine for us. We're just going to add this as well. If you want exposure to a drone company, then you can have exposure in an existing company with a good history of operations and do it without any of these risks at all. We absolutely tick the box on all of these things that Vista Partners consider to be the most important attributes of an investment. Look at what he said here. "The most durable winners will be companies that convert strategic relevance into dependable products." Well, that's us. We've been doing that for years.
Particularly in the drone space, we're already there with this acquisition. We're only going to make it a whole lot better. Okay. I was going to end this here, but I just want to give you a quick P.S. The market's crazy place to be in. Okay? What you're looking at here is a chart of today's trading. You can see on the left-hand side, when we released the news this morning that we'd sold into a nuclear facility for some incredible operations with our drone product, we traded 22 million shares pre-market, average daily volume of 1 million shares a day, and we traded from $0.98 up to $1.10 or somewhere like that. Very positive. Lots of good stuff going on. Then the market opened.
Nasdaq took a beating today because of AI stocks, because of inflation, because of the oil crisis, because of all the other things that have been contributing to these things, and we traded really poorly after the market opened. Now you can take from that what you will. Let me tell you what I'm seeing there. What I'm seeing is there that Beam, what we're doing, the stories that we're producing, the operation, the activities that we are actively engaged in are really positive. They are exactly the right things. They may not be enough to buck the tide when the broader markets are going the way they are, but that will change. Uncertainty goes away after the midterms. Uncertainty with all these other things, I don't know if it goes away, but it certainly should be reduced. The tariffs, the inflationary pressures, the wars, these things are transitory.
What's not transitory is Beam's constant evolution towards having better and better products, more and more customers, more and more opportunities, and that's what we are executing on. I think this really tells a story. On our own, people like what we are doing. They are excited by what we are doing. We craft good deals. Take a look at all the previous transactions we have done. We don't throw money around like crazy. They are all very well thought out. This one's no different. Yes, the markets are really tough at the moment, but they will come back, and when they do, I think we are in a position to take a tremendous position of advantage from them.
With that, thank you very much, and I'm going to return it to Luke, and take any questions that you have. I apologize. I'm a little over time on there. There's a lot to talk about.
But I'll take your questions, and any of you who want to hang around longer than the hour, we'll go to, let's say, an hour and 15 or something. Luke?
Yeah. Thanks very much, Desmond, for the presentation. Obviously very exciting times here at Beam Global. We'll now open the floor to questions. We'll begin with a limited number of live questions, so if you'd like to ask a question of Desmond, please raise your hand and I'll unmute. The first question comes from Tate Sullivan.
Hello, Tate.
There you go. Can you hear me now, Desmond?
Yeah, I hear you now, Tate.
Okay, great. Thanks. Is ScoutDI a service company as well, or will it sell the drone completely with the associated data collection efforts too?
Yes, at the moment, revenues are derived from selling the systems, and then there's a recurring revenue stream that comes along with the software, which is, like all of these things, very high margin and gets better and better the more and more customers we bring on board with it. Is there a future for offering these things as a service? Absolutely. We will look at that from a customer-by-customer basis and whatever's best for the markets, but I could definitely see us doing that.
Do they have any drones that have operated without a tether to this point, or that's a future development effort?
They have. They've looked very hard at this, operating them without the tether. Again, the tether's not there because they can't do anything else. It's not actually that difficult to bolt a battery and a radio to one of these things. It's just a different module. What is difficult is bolting a really good battery, bespoke and fit for purpose, and of course, that's what we're really good at making. We will certainly do that. Then removing the tether from a comms point of view, there's nothing in science or technology preventing us from doing that. It's just that at the moment, what they've been concentrating on are doing these environments where it actually makes sense to have it tethered.
We will certainly continue to prosecute those markets, whether they're the inspection market or also some of those dual-use law enforcement, war-fighting type of environments as well, where the tether makes a lot of sense.
And just a couple more if I could turn it over. Does the company currently outsource their manufacturing based on your map of the manufacturing facilities?
No. In house. They're manufacturing themselves.
Okay.
They are fully integrated, vertically. They make the drones themselves. They write and make the software. They invent, they engineer, they do it all. They're very like Beam. They make everything. Now, that doesn't mean they don't buy some components from other people. They do. That's something that we'll be hoping to operate, work with companies like Unusual Machines to acquire American components in the instances where some of the components are not American for the U.S. market. But no, they're fully vertically integrated, and they're only going to become more so when we come together and we're able to bring our engineering and our battery solutions and our charging infrastructure to them as well.
Well, thank you for having that update call, Desmond. Thanks.
My pleasure. Thanks, Tate. Thanks for being here.
Thanks very much, Tate. Thanks to everyone who raised their hand, but due to volume of questions and time constraints, we will now move to questions that have been submitted in advance. The first question. How long after the merger will it take for Beam/Scout to satisfy the Department of Defense procurement requirements and become eligible for procurement?
Yeah. Thank you. That is going to be a very high priority for us. The fact is that conditional approval, really great to have it, but without meeting the condition, it is not worth anything. We are going to make that condition met by manufacturing very quickly. That is one of the things that will be a high degree of focus for us. Our facilities in the U.S. and in Europe are readying for that. The Scout team will bring the necessary understanding and training quickly to get that done. Be looking forward to that. I certainly intend to produce a drone in the U.S. this year.
Great. Great. The next question is, as a shareholder, I noticed that the cost of acquiring ScoutDI is higher than Beam Global's current market cap. Could you explain how Beam intends to finance the acquisition and outline the terms of the payment?
I got the first part of that. The acquisition is more than or equal to Beam's market. Yeah. What was the second part, Luke?
Could you explain how Beam intends to finance the acquisition and outline the terms of payment?
Oh, yeah. Well, I think we already covered that in the slides. The Scout existing shareholders will become Beam shareholders. They're going to get some Beam equity in return for a certain portion of this. We want that. We want them involved in the company. We want them involved in the future success of the company, particularly because some of them are involved in the industries that we approach and very useful from a business development point of view. But it also speaks volumes to their faith in the post-transaction operations. They're not running for the exits at all. The rest of it, the remaining part, will be done with cash. And as I said, we have non-dilutive financing lined up to do that with terms which are acceptable to us and which are manageable by us.
This is going to be a way for us to acquire this company, bring it on board without significant dilution. And as I said, the terms are acceptable and manageable on the portion that we're going to use to fund the cash.
Great. The next question is, could Beam and Scout license some of its technology to other companies, particularly in the defense sector, where larger and more complex drones are required?
That's an interesting question. I frankly hadn't thought about that a whole lot yet because we believe that we're going to be very, very busy just producing the drones for the existing market demand. That's a very interesting point. I don't know who brought that up, but whoever did, we could take that under consideration. There are certainly some very special attributes that we have. The ability to fly without crashing into things, the ability to fly in these GPS-denied environments, the software package, its capabilities in terms of digital twinning and creating really digestible reports. So a lot of that stuff. It's an interesting point. We haven't thought about that a lot, as I say, because we think we're going to be pretty busy with our core technology and core products. But never say never.
Great. The final question. Looking ahead, what are you most excited about for Beam and its current suite of technologies?
Almost goes back to that first slide. If you look at the way that we've evolved over the last few years, those products that we made for mobility and energy storage and generation, we learned so much from them. That was actually a great way to start in life because we learned how to generate and store electricity in harsh environments. We learned how to rapidly deploy infrastructure. We learned how to be involved in the future of mobility, which is going to be a massive paradigm shift. Frankly, without all of those learnings, we wouldn't be doing what we are able to do today. I think that what's going to be incredible is watching this platform develop, this technology platform develop.
You're going to see us doing a lot more in mobility, particularly where autonomous vehicles are concerned, because we have this unique way of charging autonomous vehicles without human interaction with our patented wireless autonomous charging infrastructure. You're going to see us involved in a lot of other micro-mobility solutions, which are not on four wheels, two wheels, three wheels, and then larger mobility solutions as well. You'll see us doing a lot around the future of mobility. Energy storage, we're definitely going to continue to focus very heavily on the battery technologies, and we know that AI and data centers are huge opportunities for that, and it just so happens that we have some specific solutions which are unique to us and great. In fact, our team just spoke at The Battery Show in Michigan, about this very subject, making these highly energy-dense, rapid discharge batteries.
Batteries don't like doing that, but we figured out how to make them do it and be comfortable doing it. The approach after we spoke about this technology and released some of our recent patents has been fantastic. Expect to see us doing a lot more there. Then, the infrastructure side of things, too. The way these things are all tied together. I don't separate drones from mobility, from energy, from smart infrastructure, because all of these things are related now. It all becomes part of this massive infrastructure bucket, and we're fantastically positioned to provide for that. I think the future, you're going to see just the technology platform continuing to advance, becoming more and more integrated, more and more vertically integrated. We will be attacking our geographic expansions, too, particularly Middle East and Africa.
Great. Very exciting. Desmond Wheatley, thanks for taking the time to answer the questions, and thanks to everyone who submitted questions today and joined us live. Thanks very much, and we appreciate your support of Beam.
Yes. Thanks, everybody. Appreciate it. Hang in there. The company's performing. We're executing. The markets will come back.
Thank you.