Research Frontiers Inc Q4 FY2025 Earnings Call

Good afternoon, and welcome to Research Frontiers' investor conference call to discuss the fourth quarter and year-end 2025 results of operations and recent developments. The company will be answering many of the questions that were emailed to it prior to this conference call, either in their presentation or as part of the Q&A session at the end. In some cases, the company has responded directly to email questions prior to this call or will do so afterwards in order to answer more questions of general interest to shareholders on this call. Some statements today may contain forward-looking information identified by words such as expect, anticipate, and forecast. These reflect the current beliefs and actual results may differ materially from those expressed due to various risk factors, including those detailed in our SEC filings. Research Frontiers assumes no obligation to update or revise these statements. The call is being recorded and will be available for replay on Research Frontiers' website at smartglass.com for the next 90 days. I would now like to turn the conference over to Joe Harary, President and Chief Executive Officer of Research Frontiers. Please go ahead, sir.

Thank you, Paul, and thank you, everyone, for joining us for our year-end and fourth quarter 2025 Conference Call. 2025 was a year of not just incremental developments but structural adjustments in the supply chain and meaningful expansion in our automotive pipeline, architectural retrofit execution, and new product development and capital positioning. This call is important because when you step back and look at 2024 and 2025 together, the trajectory of this becomes clearer. We have maintained production continuity in automotive through license transitions, expanded OEM engagement with high unit volume vehicle programs, allowing cost reductions by our licensees and expanded engagement through other areas of the vehicle besides just the sunroof. We've seen Ferrari expand production of cars with SPD-SmartGlass and Cadillac enter the market with SPD. We've seen Mercedes showcase SPD broadly in a concept vehicle and launch architectural retrofit initiatives. We've seen advancement in the Black SPD development. We've strengthened our balance sheet. And our licensees, and I think this is important, are making new investments that are specific to SPD business, and they're moving forward and winning new business. We're going to talk about that later. I'll begin with financial results and our recent financing and then address Gauzy directly and then transition to the significant positive developments that have occurred since our last conference call. For the full year 2025 and continuing in 2026, we remain debt-free. We strengthened our working capital. Our royalties improved when adjusted for one-time licensee events early in the year. And let me now just address our February financing directly because we've gotten some questions about it. And keep in mind, I'm trying to save time by answering as many questions as possible. And I have basically taken questions that have been given to us and included many of them in my presentation. So hopefully, that will allow us to efficiently cover a lot of ground because there's a lot of good things to talk about. As we disclosed in our February 18, 2026 Form 8-K, we completed an oversubscribed $1.1 million private placement at $1 per share with 5-year warrants that are at increasing exercise prices. This offering included credit investors, several family members of one of our directors and also importantly, the owner of one of our SPD licensees, and I think even more significant, the one responsible for the SPD architectural retrofit application. And we all believe that the retrofit represents a potentially very significant market. So when the licensee closes to execution of this invests its own capital alongside long-term shareholders, I think that speaks clearly about their confidence in that opportunity. And let me clarify something that I addressed in prior calls. I had stated that we would not need to raise capital if we were paid what we were owed and if we did not experience additional disruptions and there were several in 2025. And I also said we might raise capital for strategic reasons. In 2025, all of these elements were present. We experienced AGP-related developments, Gauzy's French subsidiary rehabilitation process and slower collection of certain receivables some of which are now being collected as we speak. At the same time, we saw expanding opportunities in automotive programs, architectural retrofit, black SPD development as well as new product opportunities. Given that combination, we believed that it was prudent to modestly reinforce the balance sheet. We deliberately kept the offering small and focused and was done at a market price. Participants were long-term holders who, other than our licensee had participated in prior friends and family offerings, including our last one in September 2022. The shares were not registered for resale and are subject to at least a 6-month holding period. We entered 2026 with strength in liquidity and no debt and resources to execute on our business. I know a lot of people have been frustrated by the silence that has been coming out of our licensee Gauzy. So let me now address Gauzy directly. In mid-November, Gauzy's French subsidiaries entered into a court-supervised rehabilitation proceeding in France. This applies specifically to the French entities. It does not apply to Gauzy's German SPD film production facility. It does not apply to SPD emulsion production in Israel. However, as one would expect through most business organizations, this filing has had some ripple effects. Liquidity has been reallocated by Gauzy to satisfy the French rehabilitation monitors. That allocation appears to have temporarily reduced access to liquidity in other areas of the company, and Gauzy is actively working to address this. Senior management time and attention is understandably at Gauzy focused on stabilizing and addressing these matters. In addition, Gauzy reduced headcount. And let me just say that sometimes workforce reductions are never easy, but by adjusting expenses and overhead, it can strengthen the long-term sustainability of the company. These actions by Gauzy appear aimed at lowering operating expenses, reducing capital requirements, and moving toward a more stable operating profile for Gauzy. And even in the midst of all of this, SPD emulsion production in Israel and SPD film production in Germany continues. In the midst of this, automotive and architectural development programs continue and expand. Gauzy is reconstituting its Board to restore its NASDAQ compliance. They postponed their third quarter 2025 conference call due to the timing of the French filing. But I think it's important to understand that as a foreign issuer, they are required to file financials only semiannually. And as a foreign issuer, their third quarter filing was purely voluntary, and their annual filing is not due until the end of April. So they're on a bit of a different reporting schedule than we are as a U.S. reporting company. From our standpoint, we remain in regular contact with them almost daily, production inside and outside of France continues. Program execution continues and progress on multiple fronts continues even during these restructuring efforts by Gauzy and we'll talk about some of those things a little later on in the call. So now let me move from the discussion about stabilization to the acceleration of our business. While restructuring efforts were underway, development did not pause. Since our November call, expansion has accelerated. Ferrari continues to produce vehicles utilizing SPD-SmartGlass. And even though license supplier AGP and their European affiliate, Soliver, both filed for bankruptcy protection in 2025. This had a six-figure impact on recorded royalties for us during 2025. But we successfully transitioned the Ferrari business to another licensee, Isoclima and even though this transition occurred midyear, Isoclima sales levels exceeded their minimum annual royalty thresholds in the third and fourth quarters of 2025. Maintaining continuity through a supply chain shift requires execution even when one has to zig and zag, and we had to do that. So initially, AGP asked that we transition the Ferrari business to their sister company, Soliver in Belgium. And when some of the key suppliers, not SPD, but just in general, for automotive glass pulled their support, they moved it back to their production in Peru, and then that didn't survive, so we had to shift it over to Isoclima. But I think that while that was certainly challenging for everybody, we successfully emerged. And I think it illustrates pretty clearly the strength and the robustness of our supply chain. Moving from Ferrari to Cadillac, they also entered the market with SPD-SmartGlass and the Cadillac Celestiq this year. And the Celestiq is General Motors' flagship ultra-luxury vehicle. And it has garnered great industry and press accolades with a strong and positive focus on the four-quadrant SPD smart roof. It represents adoption by a major U.S. OEM, our first, and also validates SPD in a next-generation engineered platform for General Motors. We believe this will result in substantial additional business for us. And it is certainly significant that SPD-SmartGlass was chosen and introduced in European ultra-performance and American ultra-luxury vehicles. Mercedes also recently unveiled a concept vehicle featuring SPD integrated across much of the car, not just the roof. I think it was 75% of the surface area of the glass. As those familiar with the automotive industry understand, concept vehicles often signal direction. They reflect where engineering resources are being allocated and based upon feedback where marketing resources are deployed and what makes it into ultimately new vehicles. Let's reflect, since our November 2025 conference call, I was the keynote speaker at the Automotive Glazing Summit in Detroit. We now have high-volume quotations on four models in the automotive sector. Since our last conference call, we have also started work with a new European OEM. And in addition to those models, which can represent hundreds of thousands of units, we also have specialty programs with potential annual volumes in the tens of thousands of units that recently came on-board since the last conference call. The automotive pipeline today is broader than at any point in our history. We'll talk a little bit now about some of the new products and technical advances. SPD Black continues to advance, and OEMs have made clear their preference for glazing applications that require a neutral or black aesthetic. Black SPD addresses that requirement and broadens the market. We are also advancing new SPD film variants, optical refinements, IR and UV integration, improved manufacturing and yield and broader access to key ancillary technologies to make a super smart window. These are adoption-enabling refinements driven by OEM feedback. And of course, we listen carefully to the customer writing the checks. Moving now to the architectural market. Since our last conference call, we and our licensee, AIT, also known as LTI Smart Glass launched the retrofit architectural SPD product at Glass Build America in Orlando. We have identified four initial retrofit projects of different sizes. Each highlights a different advantage of the SPD retrofit system, which is why they were selected. In multiple cases, removing exterior glazing would be disruptive or costly. To give an example, in one case, the building is a historically designated building. That project initially specified Sage electrochromic glass, but because Sage and their electrochromics required exterior removal and replacement and something that was actually restricted because of the historical designation, the project pivoted from electrochromic to SPD retrofit. Instead of replacing the facade, SPD upgrades performance from inside the existing frame. Why is this significant? The installed base of buildings globally is vastly larger than annual new construction. And the SPD retrofit system dramatically expands our addressable market and compresses manufacturing and installation time without requiring facade replacement or structural or occupant disruption. It could stay in the building while they do it. Other projects in the retrofit market also span residential and commercial buildings as well as government installations. And since our product launched last quarter, we are focusing on developing some new and innovative ancillary systems and peripherals for the retrofit application. I look forward to answering your questions and will begin with some of those previously submitted by our shareholders. To start, here are the additional questions we received via email. I'm also combining some related questions into one. We've already covered some of these topics, but I thought it would be useful for you to hear the questions and for me to provide more detail. Joe, how worried are you about Gauzy's French rehabilitation process? What happens if the situation worsens? That's a valid question. Fortunately, all signs indicate that the situation is actually improving. It's important to distinguish between the French subsidiary's proceedings and the overall organization. The rehabilitation process is specific to Gauzy's French subsidiaries and does not extend to the German SPD film production in Stuttgart or the SPD emulsion production in Israel. Both SPD film production in Germany and SPD emulsion production in Israel continue, along with automotive and architectural development programs and market and new business development for SPD. It's true that the French filing required liquidity allocation and management focus, and Gauzy did reduce headcount as part of the restructuring. However, a well-executed restructuring can lead to a healthy change that strengthens the company. We remain in constant contact with Gauzy and, from our perspective, we see operational continuity and steady SPD production and program execution. I’ll address another related question. Do I have a contingency plan if Gauzy doesn't perform? Yes, we do have plans A, B, C, and D, although I hope we won't need to use any of them. Another question from Mr. Erdman: What can you tell us about the war? War is detrimental, and if I had to characterize the most disruptive aspect of our business, it would be this. We have key technical developments on the verge of taking place at Gauzy and important meetings scheduled with companies outside of Israel for this month or early next month. However, the main limitation for both is the status of Israeli airspace, which is currently closed. I've heard that it may reopen on Sunday. Some individuals from Gauzy had to take significant detours through other countries, including long bus rides, to get home. They’ve shown remarkable resilience in navigating these challenges. I received another question about why we didn't secure a business with certain car models. This inquiry, from Jared, addresses three models. I won't discuss Mercedes due to ongoing discussions, but one of the models is VW. VW opted for a PDLC product with the Porsche Taycan, and I don’t know the rationale behind that choice. I'm unable to explain why we didn't secure that business, although they likely received information about the performance and reliability of PDLC products, just like other companies. Interestingly, PDLC was later removed from the Taycan. As for Corvette, the situation is unrelated to performance. A supplier known for providing other products to Corvette had announced that they would supply an electrochromic sunroof, generating excitement in August. However, they soon realized they couldn't produce it at scale and removed it from the configuration list. I also received a question from John Nelson about whether SPD could replace a less favorable option offered by GM for Corvette roofs in 2025. I appreciate your use of the term "less favorable," John. I don't want to disparage anyone, but I agree with you. Yes, our chances of being selected are substantially improved due to recent developments. Our accomplishments in automotive technology are unprecedented. We are collaborating with four different OEMs, which brings varied quality assurance requirements and supply chain preferences. Successfully integrating into serial production across all of them is something I highlighted at the Detroit Automotive Glazing Summit where I was keynote speaker and Chair. This is becoming increasingly clear to many OEMs, and they recognize the significance of what we and our licensees have accomplished and what it takes to maintain a reliable supply chain. Let me return to some other questions. Are there stabilization efforts underway at Gauzy? Yes, not only stabilization but also ongoing execution of all their active programs. They are making progress and addressing cash flow issues stemming from the French bankruptcy. Once these matters are resolved, everything should fall into place nicely. As I mentioned earlier, we maintain daily contact with them to help navigate through these challenges, and they are receptive to our assistance. Another challenging question: When do you expect significant revenue growth from these automotive programs, and what makes you confident that 2026 and beyond will be better? Automotive integration is time-consuming due to the complexity of vehicles, which involve thousands of parts and require coordinated purchasing decisions. However, we've made significant progress. These initiatives began some time ago and are well underway. Additionally, our SPD technology has been validated across four OEMs, which is unprecedented in the auto industry, and we have even more OEMs in aircraft. This reliability and maturity of the technology have been advantageous. In summary, we've planted the seeds, nourished them, and are now seeing growth. The breadth of our pipeline and the engagement with engineering teams are crucial factors. Currently, we have Ferrari and McLaren models in production, and Cadillac recently joined production at General Motors, which I previously referenced. Mercedes is showcasing SPD within a concept platform, and we have high-volume quotations helping us lower costs significantly. We also have further European OEM programs and specialty projects in the pipeline with thousands of potential units. Our licensees have made SPD-related investments, contributing to the largest breadth we've ever seen in our history. This is why I believe 2026 and beyond will differ. As programs transition from quotations to production, revenue follows, but this doesn't happen immediately, especially in the automotive sector and under a licensing model. Our focus remains on execution, integration, and establishing reliable use in vehicles, after which revenue will come for us and our licensees. That's our simple approach. Another question: Is Ferrari’s exclusive production volume indicative that this remains a niche technology? Both Ferrari and Cadillac, along with prior collaborations with Mercedes and McLaren, have validated SPD technology's performance and the reliability of our supply chain for mass production. We've achieved production consistency across multiple OEMs with differing requirements and processes. Now, our focus turns to expansion. We are pursuing four high-volume quotations in the automotive sector and exploring specialty programs capable of producing tens of thousands of units. We engage in broader glazing discussions beyond just sunroofs. Our current pipeline is focused on scalability, performance, and cost. While we've consistently delivered superior performance, we are now proving we can also scale and manage costs effectively. Another complex question regarding automotive: If this technology is so compelling, why hasn’t a major OEM adopted it across all vehicles yet? The adoption of automotive technology is often specific to certain models and platforms at the outset. OEMs factor in cost targets, strategic positioning, design cycles, and competitive actions when integrating technology. Currently, we're witnessing broader glazing applications beyond sunroof panels, which indicates platform expansion. A useful analogy is a historical reference to antilock brakes, which started as a luxury feature in high-end vehicles before becoming an industry standard. We maintain strong relations with Mercedes and provide insights on their perspectives. I've discussed this with a key developer in S-Class and SLK models. He expressed no regrets about SPD but shared a story of a dynamic shock absorber system that could have significantly improved Mercedes vehicles. A missed opportunity resulted from not sharing technology with BMW, which could have accelerated its incorporation across more models. I believe widespread adoption of SPD within OEMs will ultimately depend on addressing two crucial issues we've previously discussed: cost and color. Another question I posed to myself today as an investor is, why should investors exercise patience? For me, it's easier to be patient given the insights I have on our progress and pipeline. However, from an external perspective, investors should be patient because the foundation has already been established. We've invested over $125 million in SPD and its market. These substantial investments have been validated by key customers and contribute to a strong rationale for patience. Furthermore, we've seen increased diversification across various OEMs and different vehicle applications, which will continue to evolve. It's important to note that we've maintained production continuity during challenging times, despite many competitors facing bankruptcy—including a recent competitor, eyrise, that operated in the liquid crystal space. The harsh realities of this industry necessitate a better, more strategic business model, which we've successfully implemented. New OEM programs have emerged, further justifying investors’ patience as these initiatives will grow. Additionally, the architectural retrofit market offers considerable growth potential, establishing a solid foundation for sustainable growth. We've set the stage for reduced costs and increased revenues without incurring significant capital expenditures or diminishing profit margins at Research Frontiers. Consequently, we are well-positioned for investor patience to pay off. We’ve discussed a range of exciting topics, and now I’d like to invite our operator, Paul, to open the conference for any additional questions from participants that haven't been addressed. One note: we've covered a lot of material today, and the call is lengthy. If your questions have been mostly answered but require further clarification, please email us instead of asking during the call, as we'd like to maximize time for as many questions as possible. Paul, please open the Q&A for live questions.

And our first question comes from Jeff Harvey, an investor.

So Gauzy announced a $50 million funding proposal. That obviously hasn't gone forward. At least I haven't seen anything to indicate that the funding has been in place. So that's a little disturbing. The other thing is that......

Yes, let me address that first because having cut my teeth on corporate transactions as a lawyer and also as the CEO of Research Frontiers. It's not that it hasn't gone forward, but equity credit lines require a registration statement we filed with the SEC and they go effective. Due to the timing of the year, I believe that Gauzy would have to actually have their audited financials in place in order for them to file that registration statement. But I think it's also probably important and I don't think I'm revealing anything that I shouldn't about Gauzy's funding plans. But that's more of an intermediate funding plan. They don't need that much money to execute on their business plan and move it forward. And they have access to more immediate, shorter-term capital. That's meant to take care of some of the debt that they have with a particular lender at a higher interest rate. And it's nice to reduce your interest expense. We don't have any debt, so we don't have any interest expense. But they're a different company, so they do. Anyway, I didn't mean to cut you off. I just wanted to address the question while it's fresh. I think you had another question or comment.

Yes. Two other things. First of all, the stock has been under $1 for a while, and I think they might be approaching a situation where they could receive another letter from the SEC regarding potential delisting for being under $1, but I also....

You're talking about Gauzy stock. You're talking about Gauzy stock.

I believe that they will struggle to pay you on time as you would prefer until they sort out their financial situation. Therefore, your expectations for receiving royalty revenue from them in the near term should be tempered.

Let me address that while it's fresh. Okay. I'm sorry if it's related. I want to make sure I answer all your questions, Jeff.

I would think also that potential customers would be reluctant to want to do business with Gauzy given their financial distress.

They are all good points. To elaborate, I have been in close communication with Gauzy since the day after the bankruptcy filing. The primary concern is whether we will receive payments, and I can confirm that we will. They have communicated to the French regulators that we receive funding from Gauzy in two ways, one being Vision Systems in France, which is directly supervised by the French authorities. This adds an additional level of bureaucracy to our payment process, meaning it could take longer. Our invoices have been submitted, and although there are no guarantees, I'm informed that it usually takes the regulators one to two weeks to approve them. Regarding our pre-filing obligations, which are affected by this regulatory oversight as of the November 13 filing date, we have about half of our receivables from Vision Systems under scrutiny. The other half is in line for payment. I also asked Gauzy about any customer concerns regarding their financial stability, and they responded that there are none. While I'm primarily focused on SPD film and emulsion, it's clear that the overall revenue flow is still strong, with customers continuing to place orders, including many long-term contracts that require their ongoing supply. Gauzy was on track to meet its 2025 projections until the labor unions initiated a reorganization process, which halted operations and payment processes for suppliers. This situation needs a quick resolution as they have a significant backlog of profitable orders. To ensure liquidity, Gauzy has rearranged their capital from other areas to facilitate this. I recently spoke with Gauzy's CTO, and they are currently producing emulsion ready for delivery to Germany, which should be easier once airspace restrictions are lifted. It’s a short-term issue, and moving some emulsion production to Germany may mitigate future disruptions. Overall, I believe we are nearing the end of this disturbance.

And our next question comes from Mike Forrester, an investor.

My question arises out of the third quarter report of Research Frontiers. And in light of everything you've said about how positive our whole situation is. It leads me to wonder why do we have a capitalization in January at basically $1 a share plus opportunities to buy more stock at $1.10 a share with a selective group of investors, including family members of a director when at the end of the third quarter report, it said we currently expect to have sufficient working capital for more than the next 5 years of operations. End of quote. So how do you justify that?

Sure. Michael, thank you for bringing that up, and I appreciate the question. So as I mentioned earlier, there was a qualifier on that, which is assuming we get paid what we're owed and assume there's no more supply disruptions because we had one in the second quarter with AGP, as you know. And also for strategic reasons. And what I said earlier in the call, I'm not sure if you were on it, is all three of those factors were present here. Now you asked about directors participating or their family members participating. That was basically the terms were set not with the directors, obviously, they were set with the large investors, the anchor investors that were much larger investors in this offering. And then we were asked, 'Hey, why don't you have a director participation in this?' And I said, 'Guys, we already circulated our 10-K internally.' No company in the world would allow a director to buy stock once that happens. We're closing on this deal. If there's people who know that want to participate on these terms, which have already been set, they're welcome to come into this. And I'll say this to any shareholder out there. Where do these friends and family investors come from? A lot of them had amassed large positions in Research Frontiers and wanted more. And because they have large positions, they would call me throughout the year, throughout the years, I got to know them. Most of the people in this round had invested in the last round, which was in September of 2022. So I knew them there. And they had invested in the prior rounds and the prior rounds and the prior rounds. So these are long-term shareholders. And maybe just to kind of put a color on this, if anybody out there is interested in participating in one of these things, assuming we have to do one again, maybe it's a couple of years before we do it or maybe it's sooner if isn't an acquisition we want to make or a marketing program we want to launch or something like that. Let me know when we're talking, I'm happy to put your name on a list, and we could always figure out if it makes sense for you. But it's not meant to exclude anyone. But these are people that we know and trust. And just to put a little more color on it, in September 2022, the stock that everyone got had a restrictive legend, meaning you cannot sell it in the open market as long as this legend is on the stock certificate. And even though they could have taken that certificate legend off six months after the September 2022 offering, nobody in that offering did. So these are long-term holders. And we appreciate that because that's how you get rewarded with a company like this, which has relatively long development cycles with customers in automotive and in aircraft. I think everyone that works in that industry kind of knows about the development cycles. But that's why we did it, and that's why we did it with the people we did. And if anyone is interested, love to hear from you. I can't promise you we're going to do this again. But if we do, and things make sense, we certainly would consider you.

Well, it's not just about the recapitalization, although the third-quarter report does indicate an expectation that it wouldn't happen for five years. But...

But if you listen to the conference call.....

Hang on.

Okay. I'm sorry. I didn't mean to interrupt you.

It's about the timing. You're sharing positive information suggesting that Gauzy's situation is not as dire as the media claims. I want to believe that, especially since I own stock in Gauzy. However, they filed for bankruptcy in mid-November, and now it's January, not even three months later, with Research Frontiers' stock also falling sharply along with Gauzy, and the offer is only $1 a share. Last year, it was around $2.30 a share with better incentives for those investing in the company. I question the timing. Why not wait until at least May? According to the latest quarterly report, we have enough cash and cash equivalents to sustain us for at least 12 months. This timing feels like it's benefitting those who might not really need it.

I'm not giving a gift to anyone; this is an investment. However, I want to emphasize this: if we had received what we were owed and if there had been no supply disruptions—two things that did not occur—we could have considered a different approach. Currently, in March, we have a matter pending with a French regulator, and we are hoping for payment soon. I believe that no one on this call would want Research Frontiers to lack the liquidity necessary to execute our business plan. My focus is on the long-term shareholders and successfully implementing our plan based on the achievements we've made in various markets, which is something unique. I will not gamble with your money or my money, waiting for timely payments or hoping for no further supply issues. As a CEO, it's imperative to avoid that kind of recklessness.

One last question then for you. In light of what you're predicting is when you get the money and so on. Are you going to put out a press release of how things are going so that we might know?

Yes. We typically don't put out press releases unless there's a specific event like the launch of the Celestiq was a specific event or a major non-financial development, but the financial developments are on a cadence of being announced quarterly. And our next quarterly conference call is in the beginning of May. It's not that far off the way that the SEC filing schedule falls, early May is when we typically have our first quarter call. You might see it then.

So by then, we should know whether or not Research Frontiers has got its licensing fees from the bankruptcy monitor, right?

Yes. Yes. I think you'll see a change in our receivables when that happens and in our cash position. And that's not too far off. So financial results, we don't announce in between quarters, but it's close enough where you'll know about it soon enough, I think.

And our next question comes from John Nelson, an Investor.

Joe, I have a couple of quick questions. You mentioned four projects involving the retrofit window. Can you provide any insight into when any of those might commence?

I think they've already begun. I mentioned earlier that we're developing some peripherals to complement the retrofit window, which is a well-established product. However, when considering any kind of smart window, it's important to have controls that are easy to install and integrate, similar to the glasses. This is something we are actively collaborating on with LTI, Gauzy, Research Frontiers, and our customers to provide them with options. Essentially, we've chosen various types of projects because I see them not just as sources of revenue, but as opportunities that will generate income when we fully commit and have all the peripherals ready. AIT can execute this quickly due to its capacity and customer base without the need for significant advertising. Additionally, I aim to create white papers for architects to help them understand the benefits. In some instances, the advantages are clear, such as dealing with building facility management and building envelope issues. For example, a residential project with 30 or 40 interior windows could be highly disruptive and costly for tenants if we were to replace all the glass, but with our solution, we could implement it quickly and efficiently. Therefore, it's about establishing proof points.

Yes. Successful application will create awareness, more awareness......

The good news, John, is that in the architectural market, we have much more control over how that news is communicated compared to the automotive or aircraft sectors, where we depend on the original equipment manufacturers. In this case, architects and homeowners enjoy showcasing what is in their homes, except in cases involving high-profile individuals who prefer to remain discreet. We have encountered similar situations as well.

Okay. And second question is, has Ferrari expressed any interest in expanding the SPD roofs to other models?

They have. I can't talk about the specifics on that, but they make a lot of money on the option, and they're thrilled with the performance. I mean it has the performance of Ferrari. So what wouldn't they like about it?

Our next question comes from Art Brady, Investor.

Basically, I'm interested in learning a lot more about what is happening with the GL project, the Korean company that concentrates on building kiosks?

I'm not going to discuss a specific project, and since we've been on the call for an hour, I think it's best not to focus too much on details. Art, I know you tried to reach out to me earlier this week, but I usually don’t take shareholder calls right before SEC filings to avoid any issues for shareholders. Feel free to contact me tomorrow, and we can discuss it then. I appreciate your resourcefulness and would like to hear your thoughts. Now, I’d like to offer some closing remarks. Consider that Ferrari and McLaren are maintaining production continuity, Cadillac is entering the market, and Mercedes is broadly integrating SPD in a way that covers a substantial part of the car. We've seen significant reductions in costs due to increased OEM quotations, and Black SPD is advancing alongside our architectural retrofit efforts. Our balance sheet is strengthening, and our licensees are making new investments in SPD equipment, including a direct investment in Research Frontiers through a friends and family offering. What we have is not a static company but a solid foundation and a technology platform that is being integrated worldwide, across various vehicle segments and applications. Major investments have already been made, and our infrastructure is established. SPD continues to outperform every other SmartGlass technology, and we are addressing costs and color while increasing diversification. The level of engagement we have today is stronger than ever before. Linking these developments, we see a business that is no longer reliant on a single vehicle, OEM, customer, or market. We believe all these factors position Research Frontiers for sustainable and diversified growth as these programs develop in the marketplace. Thank you all for participating in today’s conference call. If you have more questions, don't hesitate to email or call me. We aim to respond promptly, and I look forward to providing further updates.

This concludes today's conference call. Thank you for attending.