During this presentation, we welcome Duos Technologies Group, ticker symbol DUOT on the Nasdaq. Joining us today from the company is their Chief Financial Officer, Adrian Goldfarb. Before I turn it over to Adrian, I just want to remind everyone that management is continuing to be available throughout the day here for one-on-one meetings at the conference. If you have not already scheduled your one-on-one meeting and would like to do so, feel free to send me an email, that's Blum, B-L-U-M, @lythampartners.com, or visit the landing page for the conference, that's lythampartners.com/fall2024. From there, you can click on the Investor Registration button to make your one-on-one selection. Adrian, thank you very much for your participation in the conference today, and the floor is all yours.
Thank you, Robert. My name is Adrian Goldfarb. I'm Chief Financial Officer here at Duos Technologies Group, and I'm going to be spending about the next 20, 25 minutes or so just taking you through an overview of the company. We are available obviously for one-on-ones later, but what I want to do is at least give you some background on the company and how we plan to move forward over the next several years. Our obligatory safe harbor slide. Obviously, anything that we talk about may be for illustration purposes and we give the various caveats that come with that. So what's the story so far? As the slide says, let me talk about the big picture.
On my personal background, I've been working as a CFO with microcap companies for many, many years. This particular company went public in 2015. It was done via a reverse merger. Went up to Nasdaq in 2020, about a week before the whole COVID crisis hit. We went through a significant leadership change in late 2020 with the current CEO, Chuck Ferry. From that time, we spent the majority of our efforts in redefining the company and working on a series of technologies that I believe puts us in a very transformational place. This presentation actually will cover the introduction of quite a few new things that will also be more expanded on over the next few months.
So I'm going to talk about what we call the new age of railroading, that's really in our tech side of our business. The new age of infrastructure, and the new age of computing. I'll cover a little bit on the financial data, and then, if there's any questions from Rob and the team, I'll take those as they go. So coming back to the big picture, Duos Technologies Group really used to have one, a division or one entity. It was a technology entity, and it was focused on the visualization, and analyzing of moving objects. Most people used to know us as kind of the rail technology company. The rail technology company happens to be just one description of what we did in that particular division.
But we've really focused on things like data analysis, visual analysis, machine learning, and even AI, before AI became kind of the popular thing that everybody wants to talk about today. So, following on from that, we recently opened a new division called Duos Edge AI, and Duos Edge AI is in the market of providing edge data centers, and I'm going to talk about that a little bit later in the presentation. And then finally, we literally just put up another division, Duos Energy Corporation. And part of this presentation is to explain the linkage between these three entities. Let's start with the new age of railroading.
We've been working, as I had mentioned before, on the visualization of moving objects, and this is one application that we've been actually working on for many years. It turns out that in the railroad business, and we talk a lot about Class I railroads. Class One railroads typically are the largest railroads here in North America, and what that does is that those railroads they move a tremendous amount of freight and passenger traffic across the continent, and in order to keep everything safe, they have to do mandatory inspections that are mandatory by the Federal Railroad Administration, so Duos, some number of years ago, came up using the technology that we had developed on a way to automate that.
So instead of a mechanical railcar inspector having to literally walk around a railcar and spending upwards of two minutes on a car, looking at the sides, looking underneath, typically, they didn't climb on top. We came up with a technology, which as you can see to the left hand of the picture, literally looks like a big warehouse that the rail consist, which is the locomotive and the cars, passes through at high speed. By high speed on the freight side, typically, and that's the 50 to 60 miles an hour area, would be about the maximum speed on that. But we're also working on a project for the passenger transportation with Amtrak, where we can do the analysis at up to 125 miles an hour.
So this is very, very advanced technology. In fact, it's so advanced that we have actually filed a number of patents. We have 10 patents granted. Two in particular are extremely significant. One of them relates to the entire methodology by which this process is done. So the whole thing of scanning a rail car and then producing the images in literally under a minute so that they can be analyzed. Now, this was combined a few years ago, and it's really been developed over the last four years, with a series of AI algorithms. And what these AI algorithms do is they will actually look for something that might be an issue, and then do the visualization analysis on that to determine: is it a significant issue, and can it be raised with the railroad?
And you'll see some pictures in a moment that shows what that can do. So as I mentioned, the pictures that this technology can produce are extremely detailed. Now, if you just look at this, these images here, other than the one on the bottom right, it looks like nothing's moving here. I mean, if you look at the wheels and so forth, it looks like it's absolutely still. These trains are actually moving at 50 and 60 miles an hour. That is the quality of the images that our railcar inspection can produce, and that's part of what covers the. That's part of what the patent covers.
It is able to do this through a series of techniques, including using line scan cameras, which basically takes a sliver of an image, in effect, one pixel wide, and then stitches those together. So you can imagine the amount of technology that went into that, because a train, even if it's moving at 60 miles an hour, you may have slight speed variances between each of those cars. Our systems actually take out that speed variance, something else that we have a patent on, and allows us to push images like that, that don't look like they're expanded or contracted, are able to separate between the two cars, and allows us to very, very quickly denote whether there are issues.
So you can see there are certain things, and these are specific to the railroad industry, end-of-car cushion, a broken wheel flange, which is a very, very big issue because a wheel flange is what really keeps the rail, the rail car on the track, and something called a bad journal. Now, bad journal, I raise that because everybody's familiar with the Norfolk Southern East Palestine accident that happened a little over a year ago. And we have a picture in the lower right-hand corner. This happens to be not an NS train, but one that was caught by our system. And if you see in there, you can see that literally one of the wheels appears like it's on fire.
This is something which can be identified, and our system is able to send signals out, and in something like this, which is an emergency, to be able to stop the train. So I don't want to spend too much of my time educating on everybody about how rail cars work, but this is one instance of Duos's technology that they developed, and you should understand that this can be applied to other industries. For example, this is perfectly capable of looking at trucks in the same way, and we've also done some basic R&D work on aircraft. And so we believe that over the next few years, we will expand this technology beyond the railroad sector.
Part of the benefits of this is we want to obviously optimize safety, that's the number one criteria, and then maximize efficiency. For the railroads, what this does is a couple of things. The FRA mandates that they must do real-time inspections once a train consist leaves a rail yard. However, before it gets to the rail yard, they would probably also like to know, is there something wrong with something or many of the cars that are on that train? So what this technology does is it allows them to identify issues, basically, as the slide says, real time or close to real-time notification of anomalies and defects, and then literally take action on that.
What you see in the middle of the screen there at the bottom is our Centraco platform, and this is an integrated user interface, which effectively displays not only the train... Once again, I'm mentioning that although those pictures look like they're still, the train is in fact moving, and on the right-hand side is a complete listing of all the rail cars. Now, if there's an issue with a rail car, that will be highlighted in red, and then a mechanical rail car inspector on the left side, as opposed to crawling around on the ground or looking on the sides of a rail car, they can actually be looking at this on the screen, and they can analyze tiny, tiny components, as you will see on the right side.
And where you see the green and red boxes, this is where the AI system is actually identifying issues, and then lifting those up and identifying those as something that we need to pay attention to. The one thing I should do is also point out that we've had conversations with the rail car unions on this, and whereas typically on technology, they're not necessarily big fans of technology, being in the concern of loss of jobs. They are extremely enthusiastic about this because this gives them tools to improve doing their jobs. So we have a lot of support throughout the regulators and also the rail car unions for this type of technology. Okay, let me switch now to what I'm calling the new age of computing.
We formed this division called Duos Edge AI about four or five months ago. The question you may ask is, well, why, what connection does this have to the technology side of the business that you just described? The interesting thing is, as a part of the development of that technology, because of all of the advanced edge processing and the amount of data that's involved in effectively analyzing rail cars that are moving at speed. We had to process, and we had the requirement to process, a tremendous amount of data, particularly when you add the AI onto that. Now, there are other systems in what we call the wayside detection area, and what they typically do is backhaul data over a cloud into a large data center.
That, unfortunately, did not work for us, because it could take up to an hour to get maybe critical inspections completed. So what we did was we put, in effect, what's called an edge data center beside each one of our railcar inspection portals. So if you remember the kind of warehouse building where the train passes through, on the side of each one of those is, in fact, a fully, stacked data center containing servers, obviously cooling equipment and power, to be able to, do that processing right at the edge and provide the results within a minute, as opposed to, 30 minutes or more. So this led us to believe that there was a market for these edge data centers.
And so, in conversations with one of our colleagues, Doug Recker, who's now joined Duos as the Duos Edge AI president and founder, he said there are many, many more applications for these edge data centers, for these type of by-the-operation processing units. And so consequently, we decided to enter that business, A, because we already had some experience in deploying these. It's trackside, but also with Doug's guidance and leadership. He is very well known throughout the data center industry. He's already created a couple of companies that he sold on successfully. And we believe that this is a tremendous growth potential for Duos, as we go into the future. The big difference between our technology industry business and our Duos Edge AI business, in the technology industry, we're very much leading edge with all the patents.
And that can be a challenge for a small company because sometimes the markets don't develop as fast as you would like them and can put strains on your cash flow and so forth as you wait for the market to develop. The nice thing about Duos Edge AI is we're already in the business. We already know how to deploy that technology, and we have the operational staff to do that. But between Doug's capability to generate a demand for this in this very specialized area, this is not a market we have to develop. And that's one of the reasons why we believe that line of business is expected to generate, as the slide says, upwards of $65 million in annual recurring revenue margins and $41 million in EBITDA by 2027.
So we expect very fast growth of this business. And to give you some other numbers, we have already contracted for three of the first three of the edge data centers, and I'm happy also to say that we are in the process of contracting for the next three and expect by the end of 2025, we should have 15 of these edge data centers in business and all producing revenue at that time. Somebody has also once asked me about where the opportunity was, because there are a lot of big companies that are involved in this, Microsoft, AWS, things like that. We won't be competing necessarily head-to-head in that business.
The demand for edge data centers runs into the tens of thousands of units, and as I've mentioned, we can be very successful deploying upwards of a couple of hundred units. Our focus is into what we call the Tier Three and Tier Four markets, which typically are in the rural areas. Just to give you some idea of the money that has been put into this, Texas was awarded over $360 million in broadband funding, and Florida was awarded $400 million. It's no surprise that our first projects are gonna be focused in the state of Texas.
So we're in the process of rolling that out, and that's the areas where we are going to be concentrating our efforts in order to drive this business forward and provide a return for our shareholders. Let me turn to the last of our three divisions, and this is the new age of infrastructure. We formed a new corporation about a month ago called Duos Energy Corporation, and once again, you may ask the question: Well, what's the connection to the other two businesses? Kind of see the link between the first two, but what's this? The connection is that it's really a personnel decision. Our management team and quite a bit of our staff came from the fast power business.
So that is where you're basically taking power units, in other words, that produce electricity in the form of gas-driven turbines, and deploying those to specialized environments. So why is this a market we would want to get involved in? It turns out, if you listen to the financial press, obviously, it's, you know, companies like NVIDIA, who's a partner of ours, Dell, who's another partner of ours, and they all talk about tremendous demand for their products. And those products are gonna have to go somewhere. They might go into some of our edge data centers, but they also will go into large, what they call the mega data centers. So all this sounds really great, and everybody's predicting, you know, very great results, including us from this.
There's one small problem, is that if you look at the infrastructure, and I'm gonna talk about the United States here, if we were to deploy everything that everyone's talking about today, there is probably about only about 50% of the amount of grid power that's available to deploy that. Now, ultimately, if you look at the very long-term plans with renewables, nuclear energy, and natural gas power plants, that will catch up, but it's not expected to catch up for maybe upwards of 10 years. So in the interim, you have to have a solution for powering that. So we originally got into this business as a sideline because obviously we were putting the edge data centers down. Sometimes they need their own power units because they're in areas where the power may not be as reliable as you need.
And so consequently, because of our CEO's background in this area, and quite a number of staff that have come on to help us build out the rail part of the business, we now have a complete staff that is able to go into this business, and our focus will be to basically provide primary off-grid power for data centers, either ones that we build or ones that other people have built. And we're focusing on using some different types of fuel. Could be natural gas, could be liquefied fuel, or other types of fuels that are available to provide the power that's available. So we set up this division.
It's in its very, very early stages, but the intent is to acquire some assets that will be deployed and further on our data center expansion. With that, that gives you a description of the three overall businesses that we're in and where we expect a lot of the expansion for Duos to come in the future. I've got a few slides I'm gonna go over. Let me start with the management team. The team here is led by Chuck Ferry. Chuck has over thirty-eight years of military and professional leadership. He spent 26 years in the army and has run two much larger companies prior to Duos.
He came to Duos in September of 2020 to basically lead the transformation that I've been speaking about for the last few minutes. Going through some of the other people, Doug Recker. Doug is the president of Duos Edge AI. A lot of experience in the edge data center business. Myself, obviously making the presentation. A gentleman by the name of Jeff Necciai, who's our Chief Technology Officer, and actually most recently has taken over the leadership of our technology business, which includes the Railcar Inspection Portal, and he will be leading that business as we go forward. Then Chris King, who is currently the company's Chief Commercial Officer, but also has tremendous background and experience in the power business, and he will have a leadership role in that.
Leah Brown, who works as our controller, and John White kind of round out the team. Here is some financial data, which basically gives our consolidated income statement. Let me just make a couple of comments about this. Duos typically, in its old format, used to hit a peak every two to three years in revenues. We hit a peak in revenues in FY 2022 at about $15 million. We've dropped back more into about the $8 million-$10 million range in the last couple of years. In 2024, we expect that growth to continue.
However, there's a big change coming in that we have restructured our revenue base from being primarily a capital-intensive build, like on a railcar inspection portal, to where we're switching much of the business to much more of a recurring revenue subscription, AI-based business. And you will start to see the results of that starting late here in 2024, and then rolling out in 2025. And we expect tremendous revenue growth over the next few years from the switch to more recurring revenue, along with the businesses that I described. In terms of the balance sheet, we currently have about $3.5 million in current assets. We've not raised a tremendous amount of money this year, as we have tried to manage with the cash that we have available.
We are currently starting to build out the balance sheet, primarily from our revenue, and building out the projects that we've previously discussed, and I expect this balance sheet to start improving as we go through the end of this year and into next year. Finally, on the cap structure, as I mentioned, we've tried to keep a good control on the cap structure. We have about eight million shares outstanding, and about 1.3 million in employee options. We have a Series D and Series E convertible preferred. These are very straightforward alternative instruments for the way to hold common. So the good thing about. There's no surprises in any of these Series D. There's no coupons or anything.
It's just another way for our larger shareholders to be able to hold ownership in the company. So our total share count, fully diluted, is just under 50 million shares, and our market cap today is about $20-$21 million. Fully diluted is about $36 million. So with that, I want to thank you for spending some time with us, for those of you that do the one-on-one, and I'm gonna turn it back to Robert at this point.
Yeah, Adrian, fantastic presentation there. Have just maybe a couple of minutes here for a question or two. Yeah, maybe just for those that might be a little bit newer to the story here, help everyone understand sort of the connection between sort of the three different divisions there.
. Yes. Yeah, I know. I went over that very quickly, and sometimes people wonder, you know, where are these disparate industries? So just to review, we have our technology business, which people mostly associate us with rail, but that will grow beyond that. As a part of that technology business, we many, many years ago began the use of these edge data centers. And the reason for the edge data centers, they sit literally track side. And so consequently, in cooperation with the president of the new division that we've created, he said there's much more demand for than what you're using for it, and I'd like to join your company to be able to boost that demand out into these rural and less well-served areas.
Whereby, for example, if you have a rural area in Texas, and they may be 300 mi from a data center, and they may be getting lags from the computing and so forth, we can literally put an edge data center right next to them, and Duos has the experience and the staff to be able to do that and to be able to deploy it, because we've already been doing it in the rail, and then the other connection with the power business comes down from the staffing that we have, primarily from our CEO and a number of the staff that came in to help us with the technology business.
But they all have this power generation, and we see a great opportunity because of the lack of power on the grid, certainly for the next five to ten years, to be able to step into that market. And the linkage between those three business is bolstered because on the tech business, we are really responsible for defining that market. And when we have to define that market, that's often hard for a small, relatively undercapitalized company to do. The good news about the other industries is we don't have to define that market. Those are already fast-growing markets, which is why we can much more confidently predict that the company will finally get onto a growth path in 2025 to much higher revenues and profitability. That's the linkage between the three.
Okay. All right, that's helpful. I just wanna make sure I understood something. I think you mentioned that first EDCs completed multiple into 2027, was it? Maybe just make sure I've got sort of my facts there. Expand on that.
Yeah. So actually the first three EDCs are actually complete in production. The first one is deployed down in Amarillo. So the way that that business works is you basically deploy it into an area. You find kind of an anchor location, and then from there, what you do is... It's like being in the real estate business. So in other words, you build the apartment building, and then you put in the basic things. So it, you know, an apartment typically has, you know, some basic infrastructure, maybe washer and dryer and so forth. So you build that out, and then people come in, they rent the space from you, and they then bring their furniture with them. And that's exactly the same with this. You deploy the data center, it's ready to go.
It has fiber connections. There's usually two fiber connections that go in, and then various, it could be one company or it could be multiple companies, including the fiber companies themselves, come in, and they start to place servers in the racks, and so we're right at the beginning, so in terms of the numbers, yes, we will have three of those EDCs up and running by the end of 2024. That's why I was saying on the results, you'll start to see a turn in Q4, and then we are already in the process of contracting for the next three, which will take us to six, which will start being deployed in late 2024, early 2025.
We expect to have 15 of these operational and fully loaded by the end of 2025. 2027 is where we expect to be up in probably about the 200 range.
Two hundred range, okay. All right, that was helpful. I think we got maybe about 60 seconds left. Any sort of takeaways that we wanna make sure investors get from the presentation here today?
Sure, so first of all, I thank everybody for taking time to look at this. I know we have on the list some people that are very familiar with the story and with the company. We are very much at an inflection point with the company. This is rapidly becoming a very different company than you knew. It still has all the base technologies and the base benefits that it had before, but we very much are now driving for a growth path on revenue and getting to profitability, and that's the takeaway for it today.
Fantastic. Well, Adrian, thank you very much for your participation in the conference here today. Greatly appreciate it.
Welcome.
Again, to anyone that would like to schedule a one-on-one meeting, you can reach out to me, Blum, B-L-U-M, lythampartners.com. Again, the website, Lytham Partners-