Good afternoon, and welcome to the Brand Engagement Network Inc.'s Second Quarter 2025 Earnings Conference Call. Today's call is being recorded. Before we begin, please note that during this call, our speakers may make forward-looking statements regarding future results and performance. Please refer to the cautionary language included in BEN's filings with the Securities and Exchange Commission, included in their Form 10-K and 10-Q for additional information concerning factors that could cause actual results to differ materially from those forward-looking statements. I would now like to turn the call over to Tyler Luck, acting CEO and Co-Founder of Brand Engagement Network. Tyler, please go ahead.

Thank you, operator, and thank you all for joining us today. I'd like to start by discussing the timing of this report. Although our Q2 10-Q filing was delayed, I want to emphasize that this was not due to negative financial performance. The delay was a result of intentional decisions to strengthen the company's foundation. First, we prioritized reducing ongoing expenses by negotiating with existing vendors to ensure we are operating with greater financial discipline. Second, we made positive management changes, including reengaging with our trusted outside accounting firm that supported us from 2021 to 2024, while continuing with our independent audit firm. These steps take time, but we are committed to building confidence in our financial processes. I've been with this company since day one. I understand our technology, customers, and mission. I can assure you that the entrepreneurial spirit at BEN is vibrant and strong. Capital has always been valuable, and we are managing it with the discipline and creativity that investors expect. Additionally, I want to acknowledge our team in Seoul, Korea. Currently, our Korean Innovation Lab is home to over 30 employees, and I am extremely proud of their efforts to drive product innovation and client success. This team represents the energy, expertise, and commitment that characterizes BEN globally. In conjunction with these foundational efforts, I'm excited to share some key milestones that highlight our advancements in building partnerships and enhancing our AI solutions. For example, we established a global partnership with Swiss Life, a process that initiated before our merger in March 2024. The announcement in April 2025 marked a significant achievement, and as acting CEO, I attended their global conference in London a few weeks ago. It was uplifting to witness the positive feedback from attendees worldwide. We are concentrating on supporting their partners globally to leverage the efficiencies of our conversational AI. We've also made strategic progress in emerging markets, such as our entry into Mexico with a partner over a year ago. This move aligns well with markets that prioritize data sovereignty, allowing us to test and refine our products while preparing for potential expansion and execution on our current pipeline. In the pharmacy sector, our launch at a conference in Boston last year provided valuable market feedback on our AI solutions. We are pleased with the results thus far, although as with any innovation in regulated industries, reviews take time as corporations are understandably cautious about this new era. However, these steps are laying a solid foundation for future developments. In verticals like automotive, we see potential where AI can foster trusted consumer engagement, a long-term challenge in the industry. The integrations we've completed position us well for initiatives we are planning in the upcoming quarters. And finally, with AI being a priority for many businesses, it’s key to note that brands in regulated sectors approach new technologies cautiously to prevent risks associated with inaccurate engagements. This is where BEN's focus on trusted data stands out. By emphasizing brand-specific data sovereignty rather than broad web data, we enable authentic and reliable consumer interactions. These initiatives reflect our commitment to providing solutions that meet enterprise needs. Looking forward, we have already scheduled our next earnings call for November 4, 2025, and our Annual Shareholder Meeting for November 26, 2025. We view this as the beginning of a new chapter for BEN, one focused on transparency, accountability, and growth. Now, I will turn the call over to our CFO and CEO, Walid Khiari, who will discuss our financial performance.

Thank you, Tyler, and good afternoon, everyone. Our Q2 results demonstrate significant progress in stabilizing operations as well as strengthening our financial position. By reducing expenses by over 55%, we've gained greater flexibility to execute our strategy and accelerate growth initiatives in regulated industries. Looking ahead, we're shifting our focus towards driving revenue growth, supported by a stronger foundation and the operational capacity to launch new customers more rapidly across our target verticals. As for financial highlights, I'll mention a few. Revenue, we did $5,000 of revenue in Q2 compared to none in Q2 of last year 2024, which reflects early traction in some of our conversational AI solutions. As far as operating expenses go, they've decreased, as I mentioned, by 55.6% to $2.8 million for the quarter, down from $6.3 million in the same quarter of 2024, which was driven by streamlined operations and strategic cost optimization. As for other income, plus $3.7 million, primarily from a gain on debt extinguishment of $4 million, which was partially offset by changes in the fair value of warrants. Net income, about $900,000 in Q2 of this year compared to a net loss of $3 million in Q2 of 2024, and our stockholders' equity increased 126% to $5.9 million from $2.6 million at the year-end 2024, which reflects improved financial health. A detailed summary of BEN's recorded financial results is included in the company's Form 10-Q for the quarter, which ended June 30, 2025, which we have filed with the SEC. And with that, I'll hand it back to the operator to begin our Q&A session.

Your first question comes from the line of Jack Vander Aarde with Maxim Group.

So, Tyler, welcome to your new role as CEO. I don’t think we had a chance to speak last quarter, so I’d love to hear your thoughts on your focus moving forward and any upcoming changes. Please share your management style and what you’re prioritizing.

Jack, nice to meet you. We haven't met before. So I think it's an exciting time to be leading BEN. And I would say my focus is really on three core priorities: the first being execution and discipline, making sure we're delivering against the commitments we've made to our customers, partners, and certainly our shareholders. I believe we have built a strong foundation, and now it's about consistent reliable delivery. And secondly, I would say the commercial acceleration, kind of translating the momentum we're seeing into scalable revenue. That's super important. That means really tightening our go-to-market motion, deepening customer relationships, and, I'd say, expanding our footprint in the verticals that we're already winning. And third, being the Chief Product Officer, I think it's super important for our focus on product leadership. So continuing to push the boundaries of responsible, reliable AI engagement, and BEN's technology has the potential to redefine how people really interact with brands. We intend to lead that shift. So in short, it's about clarity, focus, and forward motion, just really ensuring that BEN not only grows but grows with purpose.

I appreciate that. I want to follow up on the recent developments regarding the Cataneo acquisition, which I know has been called off. Can you provide some insight into what transpired? Are you still exploring other opportunities with them that are not related to mergers and acquisitions, perhaps in different business areas? Additionally, could you discuss the media landscape in general and how it aligns with your strategic focus moving forward?

Jack, this is Walid. Good to hear from you. To answer your question, yes, we're continuing to work with the team at Cataneo. We still think that our partnership is strong. And in effect, we've been working in the field together for quite some time now and have built good momentum among our customers as well as potential customers. So we see that continuing. I had mentioned in past calls that the advertising side of the business, which is related to media, is a very important pillar of this business going forward alongside automotive, healthcare, and financials. We see that continuing. The media space evolves probably the fastest. I think Tyler alluded to earlier, the fact that some of the regulated industries by definition, and rightfully so, as Tyler mentioned, move much slower. This is one that moves very, very fast. And so being nimble through a combination of buy, build, partner approach, I think, is going to be critical. There will be M&A, but there will always be both partnership opportunities in that space on an ad hoc basis as well as aligning with our general strategy to keep rejuvenating the stack dedicated to the advertising space around AI. And of course, under Tyler's leadership, continuing on the build side of the strategy by continuing to build a product which has a common foundation but finds different use cases across industry verticals.

I appreciate that, Walid. I have a follow-up question for you regarding the $5,000 in revenue from the quarter. Can you clarify whether this was from a pilot program and if it involved multiple customers? Please walk me through that. Additionally, what are your expectations for the future? Are there more revenue opportunities like this one, or is this just a unique occurrence?

Tyler, do you want to take that one?

Yes. So the $5,000 relates to a pilot program for a client we are working with in Armenia relating to hospitality and customer service in the hotel sector. And we expect this to be recurring.

Excellent. Okay. Great. I appreciate that. And then just maybe a follow-up too. Just all of the pilot programs you guys have had in the past over the last few years sound pretty promising, and they've been ongoing for a while. Maybe just to get a quick update on anything in the pharmaceutical healthcare space? Are these past pilot programs and collaborations still ongoing? Or when do you determine if you're moving forward, and what to focus on? Because there are quite a number of these, and I'm not sure how you're tackling it anymore. So just an update on any of the prior pilots, just so we have a sense of where we're headed.

Yes. So I would say all of our pilots are moving forward. I think initially, when we started to take them on, we were really more perhaps in the generative AI space. And naturally, as any business comes to ask what is the ROI on this. And so that's when we have started to move more into the Agentic AI or at least a combination. So every AI pilot that we are building and deploying needs to have measurable impact. And so really, the next phase, which most, if not all, that are progressing, is really about converting these pilots into scalable recurring relationships. And we're moving in that direction with momentum. And I'd say we expect to share more detailed results as those programs formalize into commercial agreements in the near future ideally.

That concludes the Q&A session. I will now turn the call back over to Tyler Luck for closing remarks.

Thanks, operator. To close, I want to emphasize once again that BEN is really regaining its entrepreneurial momentum. We are disciplined, focused, and committed to creating value for our shareholders through strategic partnerships, market expansions, and innovative AI solutions. We look forward to updating you again on our upcoming November 4 earnings call for Q3 results, and we invite you to join us at our Annual Shareholders Meeting scheduled for November 26, 2025. Thank you, everyone, for your time and continued support.

Thank you. That wraps up today's call. Transcripts of this call will be posted on BEN's Investor Relations website. We appreciate your interest in the Brand Engagement Network, Inc.