Thank you, Joe, and good day, everyone. Welcome to Netlist's first quarter, 2026 conference call. Leading today's call will be Chuck Hong, Chief Executive Officer of Netlist, and Gail Sasaki, Chief Financial Officer. As a reminder, you can access the earnings release in a replay of today's call on the Investor Section of the Netlist website at netlist.com. Before we start the call, I would note that today's presentation of Netlist results and the answers to questions may include forward-looking statements, which are based on current expectations. The actual results could differ materially from those projected in the forward-looking statements because of the number of risks and uncertainties that are expressed in the call, annual and current SEC filings, and the cautionary statements contained in today's press release. Netlist assumes no obligation to update forward-looking statements. I will now turn the call over to Chuck.

Thanks, Mike. And hello, everyone. We delivered a strong first quarter performance, achieving record quarterly revenue, and a significant improvement in profitability. These results were driven by robust demand for our memory products and disciplined execution across the business. As we discussed on prior call, the memory market remains structurally undersupplied. AI-driven demand continues to accelerate, while DRAM capacity remains constrained. This imbalance is rippling across the economy, from smartphones to data center servers. In netless markets, demand remains healthy across key end applications, even as supply stays tight across OEM and distribution channels. The outlook for memory remains favorable. Industry-wide supply constraints are expected to persist until new fabrication capacity comes online later next year which could delay meaningful relief until 2029. Analysts continue to expect pricing to rise through the rest of the year, though at a slower pace than the sharper increases seen in recent quarters. On the product side, our lightning portfolio of overclocked, low latency DDR5, RDEMS and UDEM solutions continue to ramp. We are progressing through qualifications with OEMs, particularly in high-frequency trading and high-performance computing space. We also continue to support industrial and networking customers with our DDR4-based custom solutions, and these accounted for a major portion of our revenues this quarter. On the next generation products, we are advancing CXL MD-DEM and low-power MR-DEM solutions. Our CXL MD-Vault is a CXL Type 3 persistent memory designed to extend memory class storage beyond the cpu socket while preserving low latency and data durability it provides a product that combined d-ram like access with persistence through power events addressing the growing performance and capacity needs of ai workloads we continue to sample and the vaults with major oems on next-generation platforms regarding our low-power MR-DEM solution we continue to be active in the development of this technology which contains proprietary ECC protocols developed by Netlis and we are looking to become the first supplier to bring the benefits of low-power DRAM into the server space, which is very sensitive. The data centers in particular are sensitive to power concerns. On the IP front, we continue to advance the defense of netless patents and multiple favorable jury verdicts In our appellate process, as you know, Netlist is seeking exclusion and cease and desist orders against Samsung, Google, and Supermicro at the ITC. A favorable ruling would block the importation of Samsung products that infringe our patents and cease and desist of commercial activities by Google and Supermicro, which involve Samsung memory products. The Markman hearing was held on April 21st, and our legal team performed very well. We look forward to the Markman order and to the start of trial this fall. Netlist has asserted the 366, 731, 608, 523, 035, and 087 patents at the ITC. These patents cover one or more products, including DDR5 memory modules, such as RDEM, UDEM, SODEM, and MRDEM, as well as high-bandwidth memory, HBM. In 2025, the U.S. Court of Appeals for the Federal Circuit affirmed the validity of our 608 and 523 patents, upholding the PTAB's IPR decision. Last month, the USPTO also denied both Samsung's IPR and PGR challenges to our 366 patent, which covers DDR5 module power management technology. These outcomes further validate the strength of our IP and puts us in a favorable position in the ITC case. As a footnote, the 366 patent is also asserted in our 2025 Eastern District of Texas action against Samsung, Micron, and Avnet. On March 6th, the U.S. Court of Appeal for the Fifth Circuit heard oral arguments on Samsung's appeal of the Eastern District of Texas 2023 jury verdict, which awarded net less $303 million for willful damages of five patents. The court also heard Netlis' appeal involving IPR challenges to the 339, 918, 054, 060, and 160 patents asserted in that case. The court will issue decisions in due course. In our breach of contract case against Samsung, briefing is expected to conclude this summer and we remain on track for a hearing before the U.S. Court of Appeals for the Ninth Circuit later this year. In addition, we currently expect First Circuit oral arguments related to the IPRs of 912, 417, 215 patents in the coming months. In April, the U.S. Department of Justice filed a public interest comment in the Samsung v. Netlis case in the U.S. District Court for the District of Delaware. The statement addressed standard essential patents, antitrust, and market power issues and supported Netlis' positions. This marks the second DOJ statement of interest in the past six months that have been supportive of Netlist in matters involving Samsung. These comments underscore the administration's support for U.S. innovation and the enforcement of U.S. patent rights. In summary, we delivered a strong first quarter and remain well positioned in the current market environment as we scale our product business and advance our IP strategy. We continue to secure validation of our patents and the strength of these patents, and we continue to pursue vigorous enforcement actions covering next generation DDR5 and HBM technologies that are foundational to AI computing. Now I'll turn the call over to Gail for the financial review.

Thanks, Chuck. We delivered a strong top and bottom line performance in the first quarter. Revenue was $104.9 million, an increase of 262 percent as compared to the first quarter of 2025. Results reflect the strength of the current industry environment, a combination of tight memory supply, accelerating demand, and rising DRAM prices, which supported both revenue and gross profit margin improvement. Operating expense declined as a percentage of revenue and reflected continued investment in R&D and SG&A to support revenue growth. Operating income was $8.6 million, an improvement of $18 million compared to the first quarter of 2025. Subsequent to the end of the first quarter, we received $10.5 million in proceeds from the cash exercise of issued and outstanding warrants. As of May 8, 2026, and based on information available today, Netlist estimates that its cash, cash equivalents, and restricted cash on that day to be $37.5 million. With a $10 million working capital line of credit and approximately $74 million available on the equity line of credit, we continue to maintain significant financial flexibility and liquidity. And as always, we manage the operational cash cycle very carefully. Day sales outstanding improved by three and a half days year over year. And overall, our cash cycle remains well below 30 days, currently at 16 days during the first quarter of 2026. Operator, we are now ready for questions.

We will now begin the question and answer session. To ask a question, you may press star, then one on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys. And to withdraw a question, you may press star, then two. At this time, we will take our first question from Suji DaSilva with Roth Capital. Please go ahead.

Hi, Chuck. Congratulations on the strong quarter here. Can you help us understand in the revenue, the composition of resale products, revenue versus netless products to understand that dynamic?

Sure. It's been about the same as last course, Gigi. I think it's, you know, like 80% resale and a little under 20% of netless products.

Got it. And then, Chuck, in the data center, you talked about putting low-power DRAM into servers. I'm curious, that trend, has that already been underway? Is that kicking off now, and what kind of shape would you expect the mix to grow? Maybe there's more of a focus on power efficiency or things like that. Any call that would be helpful?

So there has been some movement towards bringing low-power VRAM, which we use in, for example, on laptops and mobile phones to replace some of the high-power server-grade DRAMs that are going into data centers. The problem with the low-power DRAMs is it does not have error correction. The memory that we use in phones, it doesn't have error correction. So it takes a lot of work to make those DRAMs more robust using ECC technology, which we have, to be allowed to use those low-power DRAMs and get to a level of robustness, reliability in server applications. If you can do that, the low-power DRAMs are obviously much lower power, significant low power, and there is also – it's much cheaper. So we've been working at this for a number of years now, and we've got a unique solution that we're, you know, we're working with with some of the hyperscalers.

That's great. Helpful to understand what it takes to get there. And then lastly, just on litigation, maybe you could kind of recap for us, Chuck. What are the next milestones we should be watching for across the various cases?

I stated in the prepare remarks, there's a lot of appellate activity coming up this year. We've already had the appellate hearing, and we'll get a decision hopefully sometime later this year. we'll have appellate probably four or five appellate cases from now until the end of the year and those will likely be final decisions appellate rulings of the district court verdicts that we had and PTAB decisions that we had on the patents so and those will likely be final because it's unlikely that the Supreme Court would take up any of these cases so we're looking forward to the the decisions on those probably more imminent as are the ITC case cases against Samsung Google and Supermicro which is progressing smoothly for us We believe we came out on top in the Markman hearing, and things are going well in that case. And that will go to trial sometime later this year, in the fall, scheduled for the fall right now. So, yeah, you know, things are going smoothly. And, you know, we're looking at other parties that are utilizing our patents without a license. We'll be looking to enforce our patent rights against a number of other parties that are on license and are implementing our technology in the AI memory space.

Okay. Appreciate the recap. Thanks, Chuck. Thanks, AJ.

And this concludes our question and answer session, along with today's conference call. Thank you for attending today's presentation, and you may now disconnect your lines.