Good day, and welcome to SKYX Platforms Corp. First Quarter 2024 Investor Update Call. Today's webinar is being recorded. Before we begin the formal presentation, I'd like to remind everyone that statements made on the call and webcast, including those regarding future financial results and industry prospects, are forward-looking and may be subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the call. Please refer to the company's SEC filings for a list of associated risks, and we would like to refer you to the company's website for more supporting industry information. At this time, I'd like to turn the webinar over to Rani Kohen, Executive Chairman of SKYX Platforms Corp. Sir, please go ahead.

Thank you, Alicia. Thank you, everyone, for joining us for our Q1 Update Call 2024. We will have today open the call with our President, Steve Schmidt; and we will also hear from our CEO, Lenny Sokolow; and our CFO, Marc Boisseau. We're going to have our senior smart home and AI adviser, Khadija Mustafa, who joined us last year as we got a few patents related to smart home and AI. Thank you very much for everyone for joining, and I'll pass it to Steve Schmidt.

Rani, thank you very much. And it's my pleasure to be with you here this afternoon. As we've shown you before in the past, we've got a very strong leadership team. We feel very good about both the management team and our Board. Governor Tom Ridge, former Head of Homeland Security and Governor of Pennsylvania; Bob Nardelli, former Home Depot CEO and Chrysler; Lance Shaner, representing Marriott's; Eric Jacobson has joined us from the American Lighting Association; and we've been through this. Mark Earley is also from the National Electrical Code. All key executives that we rely on every single day to run the company. And as Rani had just said, Khadija Mustafa is going to join us later on the call because of the importance around AI and everything that's going on in the world and its importance to Sky as an overall company. As we've talked to you before, we believe that we are positioned to revolutionize both the lighting and smart home industries and become a safety standard in homes and buildings in the U.S. and globally. Our products significantly do four things: save lives, save costs, save time, and simplify. Many companies have had success simply in one of these areas, but having all four of these is foundational and really represents what makes us very special. We continue to grow our patent portfolio; we now have over 90 U.S. and global patents and patents pending, with 30 issued patents in the U.S., China, India, and Europe. We're currently selling our products in over 60 lighting and home decor websites, and our total addressable market is vast, estimated at $50 billion. We’re expecting strong revenue streams through our royalty, licensing, subscription monitoring, and sale of global country rights. Our technologies advance key sectors. When you think about the electrical and building safety regulators, it's really about enhancing home and building safety. Insurance companies can achieve huge dollar savings based on the safety aspect of our products, while the lighting and smart home industries are positioned to save costs and increase sales and profits. The electrical outlet box manufacturers will also see significant increases in sales and profits. Builders, apartment buildings, hotels, and the cruise industries will all achieve significant cost and time savings while enhancing building safety. In the first quarter of 2024, we generated record first-quarter sales of $19 million in revenue compared to $18.6 million for the first quarter of 2023. We reported $19.8 million in cash, cash equivalents, restricted cash, available cash, and investments available for sale as of December 31, 2023, compared to $22.4 million as of December 31, 2022. Most importantly, management anticipates the company will become cash flow positive during 2025. Let's go through some key updates over the last six months. New global smart home and AI-related patents enable and enhance performance of smart home and AI sensors in addition to home safety sensors. We recently received eight additional patent issuances, bringing the company's intellectual property portfolio to a total of over 90 issued and pending patents, 30 of which are issued, covering Sky's advanced plug-and-play smart home platform technologies for the smart home, AI, electrical, and lighting industries. We have a collaboration with a world-leading Chinese lighting supplier and manufacturer, Ruee Appliances. This collaboration will include Sky's advanced and smart products to both professional and retail markets and provides Sky substantial backing in several areas, including finance, mass production, and distribution to global markets including China and Europe. This collaboration is expected to substantially enhance gross margins on Sky's product sales. We've signed a five-year global licensing partnership agreement with General Electric to license Sky's patented advanced and smart home platform technologies. We've also announced collaborations with lighting companies Kichler and Quoizel, both which will include Sky's advanced smart products for various channels, and a partnership with Golden Lighting, a leading provider of elegant lighting solutions in the U.S., that will also feature Sky's advanced products. Enhancing market penetration to both retail and pro segments is one of our key strategies. We continue to grow market penetration for our advanced and smart platform technology products through our e-commerce platform of over 60 websites for lighting and home decor. We have started sales to builders and pro segments, opening over 100 builder and pro accounts during the International Builders' Show in Las Vegas. We've entered into an agreement to supply approximately 1,000 homes with advanced smart home platform technologies and expect to deliver approximately 30,000 units representing various products to upcoming developer projects. As announced before, we have won seven awards at CES, including most recently two for our all-in-one smart home platform. We plan to announce significant additional partnerships and collaborations in the coming months. In our core outlet receptacle strategy, we believe there are 4.2 billion applications in the U.S. market. The total addressable market is substantial, and our approach is very simple: we call it the razor and blade model. We want to install receptacles in as many locations as possible, then introduce our Phase 2 and Phase 3 technology products from the plug-and-play concept. Our all-in-one smart platform represents our Phase 3. If you think about an all-in-one platform that can make a home or building smart almost instantly, we have the capability of integrating security features, speakers, Wi-Fi, and emergency intercoms. We are compatible with multiple platforms including Apple, Amazon, Google, and Android. Our all-in-one smart platform will be available later this year. Our strategy consists of three generations of products: GEN-1, which is our plug-and-play; GEN-2, our smart products; and GEN-3, our all-in-one smart home ceiling platform. With GE's licensing, we are working to market all three generations. Regarding mandatory applications with the National Electrical Code for homes and buildings, we've filed for mandatory safety standardization for our ceiling outlet receptacle. After over 12 years of standardization processes, we believe we have met necessary safety conditions to become a ceiling safety standard.

Thank you, Steve. Thanks, everybody, for joining our earnings call. The revenue in the first quarter of 2024 increased to $19 million, which includes all the e-commerce sales as well as the smart and standard plug-and-play products. This compares favorably to the $18.6 million in comparable e-commerce platform sales in the first quarter of 2023. Cash, cash equivalents, and restricted cash amounted to $19.8 million as of March 31, 2024, compared to $22.4 million as of December 31, 2023. Sales and marketing expenses amounted to $6.5 million during the first quarter of 2024, which compares to the corresponding sales and marketing expenses of the first quarter of 2023 of $5.7 million. The net cash loss, a non-GAAP measure, amounted to $5.1 million in the first quarter of 2024, inclusive of a non-cash basis loss of $4.6 million. In total, our net loss was $9.7 million during the first quarter of 2024 or $0.10 per share, compared to a net cash loss of $4.4 million in the first quarter of 2023, leading to a total net loss of $8 million or $0.10 per share. I will now introduce our co-CEO, Lenny Sokolow.

Thank you, Marc. As Marc indicated, the first quarter of 2024 reflected expected tempered revenues following traditionally stronger calendar fourth quarter sales. Our continued market penetration is highlighted by the Ruee Appliances collaboration, and we remain focused on developing our sales channels and marketing efforts with key stakeholders. We believe we have accelerated our sales with a robust gross margin profile while managing our cash burn. Our e-commerce platform with over 60 websites is providing additional cash flow, enhancing our cash position to continue executing our business plan. We believe that we will achieve cash flow positivity during 2025. We are encouraged by our traction within builder and commercial segments, as well as our potential to realize incremental licensing, subscription, and AI/data aggregation revenues. The new improved marketing strategies and educational materials are some of the assets we're leveraging to promote our patented technologies and their cost, time, and life-saving benefits.

Thank you very much, Steve, Marc, and Lenny. Now we will hear from Khadija Mustafa, our former global leader for AI and business at Microsoft. Khadija will share what she likes about our products and why she joined us.

Thanks so much, Rani. It's becoming increasingly clear that AI is an integral aspect of our future. The value of AI relies heavily on data, which I've mentioned numerous times during this call. When we consider the three major sockets: consumer devices, automobiles, and smart homes, the latter is currently ripe for disruption. Big tech companies are intensely focused on harnessing data in the smart home space. Although there are numerous players with various components, there hasn't yet been a consolidation in this space. That's where SKYX is uniquely positioned to deliver valuable insights through anonymized data. SKYX has established a strong IP portfolio and has invested heavily in engineering, which enhances our capability to achieve mandatory standards. The potential for partnerships is vast as we combine various technological innovations. I believe these factors make the role of adviser particularly appealing, and I look forward to witnessing our advancements.

Thank you very much, Khadija. In summary, we appreciate our team's efforts, as mentioned. Khadija's background provides significant insight into our potential trajectory. We are diligently working on collaborations and initiatives that will benefit our strategic market positioning and penetration of the massive 4.2 billion applications identified. The global potential for our products is tremendous, and the commitment to enhancing safety in homes resonates strongly. We are grateful to everyone for joining this call, and I look forward to the Q&A session. Thank you once again.

We are diligently working on collaborations and initiatives that will benefit our strategic market positioning and penetration of the massive 4.2 billion applications identified. The global potential for our products is tremendous, and the commitment to enhancing safety in homes resonates strongly. We are grateful to everyone for joining this call, and I look forward to the Q&A session. Thank you once again.

Great to see the continued momentum. I'll start with a question for Rani. You've announced all these collaborations, including Kichler, Quoizel, Ruee Appliances, and Golden Lighting. I would like to know which collaborations you consider most impactful for your business in the near and long term.

I think all these partnerships are significant. Kichler and Quoizel are elite brands, and our collaborations with them will transition from online to builder segments. Ruee Appliances is particularly crucial; they are a global manufacturer renowned for quality products and are backing us in multiple aspects, including financial support. GE’s licensing of our three product generations is another major collaboration that reinforces our value proposition.

Thank you for that insight. Can you provide an update on the launch timing for the upcoming GEN-3 all-in-one platform product? Also, will any of the future announcements relate to service offerings or subscription offerings related to that product?

We are working on several collaborations, and while it's challenging to project specific timelines, the team is confident in our growing foundation as a leading company. Regarding the GEN-3 platform, we cannot disclose details on its launch timing, but we are making substantial progress.

Congratulations on the quarter. What additional information can you provide about the timing of partnerships like Kichler, Quoizel, and Ruee Appliances, and when we might see their effects reflected in your results?

Our expectation is that these partnerships will start to bear fruit in 2024, though we can't pinpoint a specific time frame for revenue recognition due to the various factors involved in collaboration efforts.

I appreciate that context. Additionally, can you share insights into the National Electrical Code safety standardization application process since you've submitted your application? What does the assessment process look like?

The standardization process for major changes is indeed lengthy. After 12 years of effort, we have received positive feedback and significant support for our application. The process involves task groups and meetings, and while it's slow, we are confident in our progress.

There's significant momentum in all areas surrounding Sky. The management team is confident in our future and we have exciting developments on the horizon to share in the upcoming quarters.

Thank you again for participating today. We appreciate everyone’s contribution and support. Have a great evening.

This concludes today's virtual webinar. Thank you for your participation.