Good day, and welcome to the Upexi Fiscal First Quarter 2026 Financial Results Conference Call. Please note this event is being recorded. I would now like to turn the conference over to Valter Pinto, Managing Director at KCSA Strategic Communications. Please go ahead.

Thank you, operator. Good evening, and welcome, everyone, to the Upexi Fiscal First Quarter 2026 Financial Results Conference Call. I'm joined today by Allan Marshall, Chief Executive Officer; Andrew Norstrud, Chief Financial Officer; and Brian Rudick, Chief Strategy Officer. Before we begin, I'm going to remind everyone that statements made during today's conference call may be deemed forward-looking statements within the meaning of the safe harbor of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially due to a variety of risks, uncertainties and other factors. For a detailed discussion of some of the ongoing risks and uncertainties in the company's business, I refer you to the press release issued this evening and filed with the SEC on Form 8-K, as well as the company's reports filed periodically with the SEC. The company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless otherwise required by law. In addition, during the course of the call, we may refer to non-GAAP financial measures that are not prepared in accordance with accounting principles generally accepted in the United States, and they may be different from non-GAAP financial measures used by other companies. The reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures are contained in our earnings release issued this evening, unless otherwise noted. I'd now like to turn the call over to Upexi's CEO, Allan Marshall.

Thank you, Valter, and welcome, everyone, to our first quarter 2026 earnings conference call. I couldn't be more excited to hold our first earnings call since adopting the Solana Treasury strategy. It has been truly transformational for the company, and as such, I wanted to comment on our past since inception. As you know, we primarily were a consumer Amazon brand owner. As the Amazon business became increasingly more difficult we started to think about the best ways to create shareholder value going forward. After a thorough analysis of many options, we made a strategic decision to invest our time and resources into digital assets. This was due to two reasons. The first was a newfound openness towards crypto in the U.S., mainly due to the change in administration and its various regulatory bodies. Put simply, the U.S. administration went from a headwind to a tailwind for digital assets and which we believe will accelerate innovation, adoption and ultimately affect prices moving upwards. Second was a greater appreciation for the value MicroStrategies has created for shareholders. Indeed, it has been the best performing stock in the U.S. since adopting a Bitcoin treasury strategy in 2020. More importantly, it has more than doubled the return of Bitcoin with only minimal leverage, meaning its capital markets activities are creating tremendous value for shareholders. We first publicly announced a pivot towards digital assets in February. As we honed our strategy, we settled in on one built around Solana. We'll cover the rationale in more detail later in the call, but the decision to focus on Solana was simple. From an asset perspective, we believe strongly that Solana has the best chance to be the end game winning high-performance blockchain and particularly so as the new rails for global finance. Second, from a treasury perspective, Solana offers additional ways to create value for shareholders via activities like staking and purchasing of discounted locked SOL. Our plan was simple: close on a large-scale capital raise, employ and improve the proven capital markets playbook from MicroStrategies where issuing equity above book value is by definition accretive. Then innovate on MicroStrategy's model by staking our Solana to generate yield to turn the treasury into a cash flowing asset and also buy on locked discounted SOL for built-in shareholder gains. We did just that in April, successfully completing a $100 million equity private placement in what we believe was the first large-scale equity pipe for an Altcoin strategy. We followed it up with a $200 million raise in July, which included an innovative in-kind convertible note issuance, offering with significant benefits for both investors and the company. Again, we believe that to be an industry first. Each time we deploy the funds into spot and locked SOL at attractive entry prices, staking nearly all of it to generate cash flow. The company currently owns $2.1 million SOL valued in excess of $327 million. While raising capital and deploying the capital in a systematic way, we remain hyper-focused on both external visibility and intelligent capital issuance. Success in raising capital and deploying it are only part of a successful public strategy. We have put forth an enormous effort to build our online and traditional finance following and to educate the market on our vision and the investment opportunity. We are proud to have been quoted in over 50 news articles since launching the strategy, participating in multiple leading podcasts each month, establishing an advisory committee with Arthur Hayes, Jon Najarian and SOL Big Brain, and attended or are scheduled to attend over 20 mostly traditional finance-oriented conferences and have conducted hundreds of individual investor meetings. As previously stated, we have remained steadfast on utilizing the capital markets to create value for shareholders. Notably, our July raise not only materially increased our Solana per share, but also led to multiple expansion as we demonstrated our ability to raise funds in an accretive fashion. On the financial side, our Consumer Brand business continues to perform as expected. Most importantly, our staking revenue is uniquely providing a huge boost to company revenue. Our fiscal Q1, we generated over $6 million in digital asset revenue, and we are currently adding over $75,000 a day. As we look ahead, Q2 will benefit from having all of 2.1 million SOL stake for the future quarter.

Thanks, Allan, and hello, everyone. The biggest determinant of any treasury company's performance will be that of its underlying token. Here, we are supremely confident in and feel very fortunate to be underpinned by Solana. We chose Solana for three reasons. First, it's the first second-generation smart contract blockchain. This means that it benefits from having best-in-class technology like parallel transaction processing like modern computers do, but also from strong network effects having launched in 2020. Second, Solana has a vibrant and growing ecosystem of users, developers and decentralized applications. You can really build anything on Solana from decentralized finance to deep into stable coins tokenization, gaming, art, social AI agents, meme coins and more. And third, Solana is already putting up the best metrics of any blockchain, often beating out all of them combined. These metrics include daily active users, decentralized application revenues and decentralized exchange volumes. But what gets me so excited is the potential for Solana to revolutionize the world's antiquated financial infrastructure. Indeed, current financial rails, for example, ACH and the credit card issuer networks were created 50-plus years ago, and even fintech is a front-end wrapper that uses these antiquated rails on the back end. However, blockchain technology allows us to entirely reimagine these antiquated rails and to utilize things like stable coins and tokenization to remove rent-extracting intermediaries and democratize value exchange. Tangibly, this means huge cost savings and speed benefits, not to mention improvements in settlement times, transparency, composability, investor access and much more. Solana is purpose-built for exactly this in what it calls Internet capital markets. Its goal is to have all of the world's assets trading on the same liquidity venue, accessible 24/7 to anyone with an Internet connection. And institutions are taking note from PayPal to Societe Generale, Fiserv, Western Union, and others. Leading financial companies are building stable coins on Solana due to its industry-leading speed, cost and reliability. Tokenization infrastructure firms like Securitize, Superstate and R3 are bringing real-world assets on chain from leading asset managers like BlackRock, VanEck, Apollo, Franklin Templeton, Hamilton Lane and others. Visa is using Solana for its USBC stable coin merchant settlement program for cross-border payments. Finance is moving on to the blockchain, and it's happening on Solana. We are in the very early innings, but this transformation is absolutely happening and with Solana front and center. Lastly, I'd point out that we have what I consider to be the mother of all catalysts that can drastically accelerate this transformation in the U.S. passing comprehensive digital asset legislation. Indeed, a lack of clear rules in the U.S. has, in my opinion, always been the biggest item holding crypto back. Institutions have thus far only dabbled in digital assets and blockchain technology and have been loath to materially adopt the technology when it comes with heightened legal and regulatory risks. However, if and when the U.S. passes this market structure bill called the Clarity Act, which is currently being worked on in the Senate with high bipartisan support, institutions will be forced to jump in, in a big way. Otherwise, they will be disintermediated by those who do. And it's big pack and big finance that have billions of customers built in trust, billions of dollars for investment in the top developers. Imagine Google adding a built-in crypto wallet to its Chrome browser or Amazon integrating stable coin payments. We just may be on the precipice of onboarding the masses, leading to a step change in digital asset innovation, adoption and usage. Solana and Upexi are well-positioned to benefit.

Thank you, Brian. Total revenue increased by $4.9 million to $9.2 million for the quarter. Net income was $66.7 million for the quarter, and earnings per share was $1.21 for the quarter. All of these increases were related to the Solana treasury performance. Solana tokens increased during the quarter by approximately 1,322,000 tokens. This increase was from both liquid and locked Solana purchases and swaps with approximately $181 million in noncash Solana purchases. The company has purchased approximately 2,029,100 tokens through direct purchases and swap transactions. The average price of Solana tokens purchased is $155.57, and 31,347 of the quarter's increased tokens were from the $6.1 million in staking revenue generated from the treasury. In total, the treasury has generated approximately $7.1 million and 37,742 Solana tokens since inception. Unrealized gains of approximately $78 million were recognized during the quarter and had a significant impact on the reported financials. Management understands the volatility of the digital assets and we'll continue to focus on growing the number of Solana tokens held in the treasury in a way that will maximize the return for our shareholders. Now I'll turn it the call back over to Allan for concluding remarks.

Thanks, Andrew. Upexi is a truly differentiated treasury company with many advantages. We have a differentiated management team that is more traditional finance rather than crypto-oriented. I founded what is now New York Stock Exchange listed XPO Logistics, and Andrew was our CFO at XPO and has been a public CFO for decades. Brian spent years at the most prestigious hedge funds managing hundreds of millions of dollars. This is relevant because at the end of the day, this is a capital market exercise, and we believe our experience will be paramount to our future success. We led the innovation to create what is now the DAT industry and look to innovate in the future to stay ahead of peers. With the first large-scale equity raise for altcoin treasury and the first in-kind convertible note, we have set Upexi on a trajectory for a very bright future. We do several things to be more in line with traditional finance to differentiate our strategy. First, we only take on a prudent amount of credit risk leverage and limit it to 20%. We do not partake in aggressive on-chain trading that increases our contract, liquidation and legal regulatory risk. Lastly, we only use qualified custodians and top validators and diversify amongst them for operational risk management and best practices. We believe this strategy will not only position us well for any market environment but also will appeal to crypto and traditional investors alike. Finally, and again, quite uniquely, we have a proven ability to create value. We have increased adjusted SOL per share in SOL terms by 47% and in U.S. dollar terms by 82%. As a reminder, the former measures our ability to capture our three value accrual mechanisms and accretive issuances, staking income, and purchases of discount on locked SOL tokens, while the latter also incorporates the price of Solana. We are in an advantaged position to win. We are underpinned by an end-game winning asset with nearly unlimited upside and offering additional value accrual mechanisms in staking and discount on locked purchases. We have a differentiated management team with best-in-class capital markets expertise. We have a risk-prudent strategy, positioning us for any market environment and resonating with investors of all kinds. Lastly, we have a proven track record of innovation and shareholder value creation. With that, I'll turn it over to the operator for Q&A.

Our first question comes from the line of Brian Kinstlinger with Alliance Global Partners.

Great. The company has added a few high-profile crypto investors to the advisory committee, like you mentioned. So can you talk about the impact we're having on the company? And any recommendations the committee is making as we think about differentiation of DAT, for example, outside of SOL accumulation and yield. Is the committee recommending or is management thinking about ancillary revenue generating businesses? And if so, can you share any details?

Thanks, Brian. So two parts. One is, so far, it's been a short amount of time we've been working with them, but we've gotten a lot of good feedback both on how we're presenting ourselves to the market, their opinions on SOL, the overall opinion on how we're positioning the company to communicate to both traditional finance and also the crypto community. No one right now is talking about anything outside of Solana and revenue generation outside of that, like we still believe as we get some clarity here going forward on regulatory changes that Solana is in line for in all of crypto or all of the top cryptos in line for a pretty big move. So we're going to continue with the strategy we have, like we've said to our investors and stay focused. We will try to maximize yield. And we have had internal discussions, but none of that's public yet. We're going to do the right thing to increase our yield for our investors as quickly as possible, and we are always open to input from the people we bring on board and also the outside community we talk to.

Great. I have two more questions. The first one is, given you didn't have a full quarter of SOL holdings, can you tell us what your effective yield has been? And is there any way to enhance that? Or are you maximizing that already? Maybe any information on the yield would help?

I can let Andrew address that question. I will say that as we've been building it step by step, not everything is staked as quickly as possible. While it is staked quickly, the pacing is carefully managed with a risk-prudent approach. We have also been collaborating with various validators and have been gradually increasing the yield. I believe this current yield is our baseline, and we expect it to rise further now that most of our assets are staked. I can turn it over to Andrew if he has a specific rate, but I'm not sure we have blended it perfectly yet due to the various steps we've taken along the way. Andrew?

Yes, you're not going to be able to blend it yet. Next quarter will be a lot better. But just to add to Allan's note, we've got a program that we put in place to look at the various different validators to have them compete against each other on any fees or anything else that's being done. We've got some great partners with us on that side and continue to look at how to increase that yield, plus we've had some other opportunities to try and increase the yield higher than just the standard staking yield. So more and more of that will come out this next quarter as we kind of have everything under control and have some of these programs in place. So, unfortunately, I can't give you an exact yield, but going forward, you'll be able to calculate a lot better next quarter.

But to close that off, Brian, we definitely think this is kind of like the baseline for us, like this is the low end and it will continue to rise from here.

Several of the DATs are trading below 1x, at steep discounts. Thankfully, Upexi is not in that position. However, I believe investors are curious about the management plans of DAT companies regarding capital markets, should Upexi encounter a significant discount. How would you address that?

We have a lot of options. Brian, Andrew, and I have always mentioned that if we trade at a discount, our model is still strong. We believe that eventually crypto yields will increase, and by maximizing that while keeping our expenses low, we will command a premium. In those situations, the company has many ways to address it. We could convert our staking revenue into a buyback or repurchase shares, among other strategies. It's essential to understand that this is a long-term strategy; we shouldn't focus solely on quarterly performance. Even if there is a temporary pullback in crypto, we see it as just a pause. I'll let Brian add his thoughts since we've discussed this with several investors.

Yes. Thank you, Allan, and thank you, Brian. Yes, plus one on the capital market side of the equation, just being a bit on pause. I think that there's no better example than MicroStrategy. In 2024, it increased Bitcoin per share by 74%. In 2021, it was something like 47%. And then when it got into a bear market, and it did trade at a discount to NAV it still was able to increase Bitcoin per share by mid-single digits. So it was just a bit on pause. Like Allan mentioned, there are things that we can do to compress any discount should one come to fruition. Importantly, we actually don't have to sell our SOL to do that. You could actually borrow some funds to repurchase your shares to compress any sort of discount. Lastly, I'd say we make an 8% staking yield on almost our full treasury. A lot of the SOL that we've bought is locked form, which when you put that discount into any yield equivalent, it's nearly doubling that 8% staking yield. All in all, we're gaining a really nice return on our treasury, and so while we are waiting to issue capital in this accretive fashion, we are able to increase our SOL per share at a very nice pace.

There are no further questions at this time. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.