Thank you, operator, and good afternoon, everyone. Welcome to the Vuzix First Quarter 2024 Ending March 31 Financial Results and Business Update Conference Call. With us today are Vuzix CEO, Paul Travers; and our CFO, Grant Russell. Before I turn the call over to Paul, I would like to remind you that on this call, management's prepared remarks may contain forward-looking statements, which are subject to risks and uncertainties and management may make additional forward-looking statements during the question-and-answer session. Therefore, the company claims the protection of the Safe Harbor for forward-looking statements that are contained in the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those contemplated by any forward-looking statements as a result of certain factors, including, but not limited to, general economic and business conditions, competitive factors, changes in business strategy or development plans, the ability to attract and retain qualified personnel as well as changes in legal and regulatory requirements. In addition, any projections as to the company's future performance represent management's estimate as of today, May 9, 2024. Vuzix assumes no obligation to update these projections in the future as market conditions change. This afternoon, the company issued a press release announcing its first quarter 2024 financial results and filed its 10-Q with the SEC. So, participants in this call who may not already done so, may wish to look at those documents as the company will only provide a summary of the results discussed on today's call. Today's call may include certain non-GAAP financial measures. When required, reconciliation to the most directly comparable financial measure calculated and presented in accordance with GAAP can be found in the company's filings at sec.gov, which is also available at www.vuzix.com. I will now turn the call over to Vuzix CEO, Paul Travers, who will give an overview of the company's operating results and business outlook.

Thank you, Ed. Hello, everyone, and welcome to the Vuzix Q1 2024 conference call. Since we reported our Q4 and full-year 2024 results just a few weeks ago on April 15, my prepared remarks on this call will be relatively brief. In the same vein, we will dispense with our usual call presentation deck also. Our Q1 revenue improved sequentially over Q4 of 2023 with our product sales increasing again. That said, industry demand for our enterprise smart glasses has clearly remained lumpy as the industry is still in the early adopter stage relative to where we and most others see it ultimately heading. Nevertheless, we remain encouraged by our current business outlook and we do expect our top line revenue to grow over the remainder of this year. And with our ongoing aggressive cost reduction and control measures, including our recently commenced voluntary cash salary reduction for equity program, our net operating losses and net operating cash burn should be reduced at an even faster pace as compared to each prior period of 2023. I'd like to now discuss at a higher level, our key business areas in terms of where we've been recently and what to expect in terms of timing and catalysts going forward. As you know, we have been developing enterprise smart glasses solutions for the enterprise space for some time. We have continued to steadily improve the performance, functionality, and wearability of these devices and we'll continue to do so, but now with a shifting and more tightened focus on waveguide-based designs. This is being done to both give us a stronger competitive position and deliver products closer to our customers' expectations and needs. As part of this shift, we are adopting a bifurcated smart glasses model approach that we think will appeal to a larger swath of our target markets. Firstly, offering high-powered stand-alone smart wearable devices, which provide broad video and computing functionalities and secondly, lightweight, less expensive thin client-type devices that can either serve as wearable displays, designed to connect wirelessly with other devices like handheld scanners, smartphones and other wearable computing devices or as AI-enabled augmented reality and artificial intelligence glasses with its intelligence and information display coming from the cloud. All these smart glasses models, we believe, are among the most competitive in the enterprise space and we have growing independent software partnerships to support them. Additionally, our steadily expanding channel strategy is now in place to sell and distribute them. We believe we are well positioned to be, if not the vendor of choice for many customers in this space as the adoption cycle finally accelerates. The return on investment realized by the use of smart glasses speaks for themselves with numerous proven proof point examples showing significantly improved efficiency in picking times, combined with fewer errors as well as sharply lower new worker onboarding and training times. It's worth repeating that as per research published by Incisive earlier this year, 69% of executives surveyed see wearable augmented reality solutions supporting artificial intelligence and workflow optimization as being central to their future warehouse operations. Our smart glasses are clearly helping modernize warehouses and improve productivity, practically guaranteeing them a spot in the future of the frontline worker. That said, many of the larger specific deployment opportunities we have pursued and in some cases long expected have been challenging to fully consummate for a variety of reasons that include, among other things, back-end software selection, customization and optimization, system integration issues such as security, communications and database management, organizational changes, multi-location training, and even union approvals. These are the common technology adoption and learning curves that we and our partners have continued to ascend. The bottom line for us here is that a growing list of current and potential enterprise customers see the value and the return on investment that our solutions can offer and our demand pipeline in this space is, as we recently stated, growing. As we move into the latter half of this year, keeping in mind the issues related to deployment, timing, and predictability I just covered, we are optimistic that we will see more and more of these larger smart glasses deployment opportunities finally get announced and/or commenced in earnest. Owning the software stack, and by that I mean the application, has been part of the challenge for deployment and hence, the reason we originally purchased Moviynt. Their business, although taking more time than expected to mature, continues to gain momentum within the larger corporate ERP-based market that we feel is very underserved by smart glasses currently. In early 2024, Moviynt announced support for our smart glasses as part of their solution offering. As a result, we have seen a growing number of potential customer engagements for pilots that have been quoted and/or are in the process of being quoted for the hardware, software, and professional services in their targeted warehousing and logistics areas as well as manufacturing and brick-and-mortar back-end operations. We have already won our first deployment, and our expectation is that multiple modes of these projects will convert to wins over the second half of 2024. The widespread consumer adoption of smart glasses faces a different set of challenges that fortunately, the largest players in the industry are driving to fix. I think most would agree that if you can offer consumers a fashionable, lightweight, and functional product at an affordable price, one that can largely replace smartphones, its use will quickly become ubiquitous and offer on-demand augmented reality and AI applications to the wearer. That said, the existence of applications and ecosystems is critical to the final missing piece. As we previously stated, AI will be the key enabler of a new level of functionality and productivity, and giants such as Meta and several others now have plans to make their AI and XR software stacks available to third parties. Apple is also expected to join the party this June as part of their annual Developers Conference. The publishing and licensing of these software stacks should enable ecosystems with content and experiences that will drive AR with AI smart glasses adoption and allow Vuzix, our other major ODMs, and larger consumer electronic suppliers a path to products that consumers will want to embrace and buy. We have multiple roads for Vuzix to participate materially in this business. First, our ODMs. We are currently working with and deepening our relationship with Quanta, one of the world's largest ODMs to supply them with waveguides, projectors, and related software with the goal of having them resell products based on our components and supplying as many of the major commercial electronics customers as possible with AR finished products and solutions. Second, we continue to meet with numerous consumer product companies directly, all of which have embraced and publicly supported the future directions of consumer AR and AI-driven wearables with their intentions to participate in this space. Finally, there is an internal effort underway at Vuzix around our Ultralite platform and Z100 smart glasses to offer a Vuzix branded consumer version of our designs that we believe we can bring to market in volume at a competitive yet profitable price point. Over the balance of this year and into 2025, we anticipate each of these roads will become more publicly visible and increasingly add to our top line revenue. How much and how soon remains variable, but clearly, the numbers here could ultimately dwarf our current run rate once things get going. Beyond consumer-related OEM engagements, we have several active defense and enterprise opportunities. As recently stated, we continue to expect at least one defense firm with which we have been working for several years to commence production of products incorporating our waveguides this year and there is a good chance a second may follow right behind. On the enterprise side, we are currently working with multiple potential partners, at least one of which we expect will go into production in the back half of this year. Again, we hope to bring you news of these engagements during this year. The backbone of all this remains our technologies and processes, most specifically our waveguide and micro LED projected development and capabilities. We covered a lot about waveguides in our recent April conference call, including INCOGNITO and integrated scripts. So, I'll simply restate that we feel we can make high-quality waveguides cheaper, faster, and in higher volumes than anyone else on the planet today. Beyond Vuzix's waveguides offerings, the expensive waveguides made by our competitors and their lack of scalability to cost-effective volume production represent an industry deployment impediment. The value of our waveguide process technologies and production facility and their future place in the wearables industry we feel is very substantial. And as our success in the OEM waveguide side of our business continues to expand, it will finally start to be realized in the enterprise value of the company. As for Atomistic, we again covered a bit more detail about their progress in our recent call, so I'll simply add that they continue to work on the achievement of the remaining performance milestones. In summary, although we still have work to do, we believe we are making steady progress on most key aspects of our business. And at this point, we expect to achieve and we'll be sharing some exciting progress on multiple fronts over the rest of this year. Grant will now take you through our numbers, after which we will move on to Q&A.

Thank you, Paul. As Ed mentioned, the 10-Q we filed this afternoon with the SEC offers a detailed explanation of our quarterly financials. So, I'm just going to provide you with a bit of color on some of the numbers. Our first quarter 2024 revenue was $2 million, down from the '23 comparable period due to decreased sales of smart glasses, particularly our M400. Engineering Services sales were $0.2 million for the 3 months ended March 31, 2024, versus none in the prior year's period. As of March 31, 2024, the company had $2.8 million of remaining performance obligations under 2 current waveguide development projects, of which approximately 60% we expect to realize in 2024 with the remainder in 2025. There was an overall gross loss of $0.1 million for the 3 months ended March 31, 2024, as compared to a gross profit of $0.9 million for the same period in 2023. The net loss was a result of lower revenues to absorb many of our relatively fixed manufacturing and plant overhead costs, which were actually 8% lower in dollar terms as compared to the 2023 period. Manufacturing overhead costs as a percentage of total product sales increased to 25% from 13% for the same period in 2023 as a result. Research and development expense was $2.7 million for the 3 months ended March 31, 2024, compared to $3.1 million for the comparable 2023 period, a decrease of approximately 11%. The reduction in R&D expense was largely due to a $0.3 million decrease in salary and benefits related expenses and driven by headcount reductions. Sales and marketing expense was $2.2 million for the 3 months ended March 31, 2024, as compared to $2.5 million in the same 2023 quarterly period. The $0.3 million reduction was primarily due to lower advertising and trade show spending and reduced salary and benefit expenses due to headcount reductions. General and administrative expenses for the 3 months ended March 31, 2024, was $4.1 million versus $5.1 million for the comparable 2023 period, a decrease of approximately 20%. The reduction was primarily due to a drop in noncash stock-based compensation and reduced investor relations expenses, partially offset by an increase in legal expenses. The net loss for the 3 months ended March 31, 2024, was $10 million or $0.16 per share versus a net loss of $10.2 million or $0.16 per share for the same period in 2023. Now for some balance sheet and cash flow highlights. Our cash and cash equivalents position as of March 31, 2024, was $16.5 million and our net working capital was $29.2 million. The cash net loss after adding back noncash operating expenses and excluding working capital changes, a non-GAAP measure, was $6.5 million for the first quarter of 2024 versus $5.4 million for the comparable 2023 period. The net cash flow used in operating activities was $8.8 million in the first quarter of 2024 as compared to a net use of $4.2 million for the first quarter of 2023. The bulk of this Q1 2024 increase in cash use was due to negative working capital investments which collectively totaled approximately $3 million across increased inventories and receivables along with reductions in accrued expenses. Cash used for investing activities for the fourth quarter of 2024 was $1.2 million as compared to $4.7 million in the prior year's period. We spent much less on fixed asset purchases related to our waveguide production facility and for technology development license payments to Atomistic. This exclusive technology license currently expires June 30, 2024, and the company is currently negotiating further licensing fees, but at a significantly lower rate as compared to the annual amounts that were paid in total for 2023 and 2022. If such amounts cannot reasonably be negotiated or would be considered too large by Vuzix's failure to pay the additional license fees could result in the termination of Vuzix's existing license to the Atomistic technologies and Vuzix remaining a minority shareholder in Atomistic with certain liquidation rights and the sharing of future royalty license fees earned by Atomistic. We continue to feel that we've taken and will be taking further actions to ensure we have adequate cash and finished goods inventory to fund growth in operations into 2025, and I would like to explain why. We envision neutral to positive working capital changes, thanks to expected reductions in further builds of M400 smart glasses and tighter accounts receivable management. Investing activities will also be minimized for priorities only and in fact, are expected to be under $1 million in total for 2024 before any investments in intellectual properties and technology licenses. Second, we are further trimming our operating expenses by taking additional actions that include, among other things, just implemented a voluntary 1-year salary reduction program that offers employees restricted stock or stock options in lieu of a 10% to 50% reduction in their base salaries. Subscriptions to this program totaled approximately $1.6 million on an annual basis. Finally, we do expect steadily improving revenue growth, which will contribute to reducing both our book and cash operating losses. And we expect within 12 months to improve our total product margin through outsourced manufacturing of selected products. Taken together, we expect all these adjustments will allow us to reduce our total average statement of operations, operating expense, and non-GAAP measure to a new target of approximately under $4.5 million for fiscal quarter starting by July 1, 2024, a 35% reduction over the 2023 comparable period. Achieved gross margin or losses from revenues will, of course, positively or negatively reduce this cash burn as we better right size our operations, but still grow. Of course, in addition to better working capital management, we can improve our cash position through potential strategic investments, government engineering service brands, and under the right circumstances, other equity-based liquidity options available to the company. As of March 31, 2024, the company continues to have no current or long-term debt obligations outstanding. With that, I would like to turn the call over to the operator for Q&A.

I guess first on some of the engineering services or the contracts in place, Grant, you mentioned the remaining performance obligation. But how much visibility do you have into the actual timing of each step of that project pushing forward and ultimately recognizing revenue? I appreciate you gave us an estimate for what might be recognized here this year, but how much visibility in the actual timing do you have at this point?

I believe it should be somewhat back-end loaded into the second half, with Q2 expected to be larger. In Q1, there were actually no revenues from that project. Maybe, Paul, the current schedule provides the best details, so could you add something on that?

Another 14 months or so, the one program would be fully delivered on. So, a lot of it should show up here in the back half of this year for that one particular program. Some of the other programs, Matt, we're highly anticipating production rollouts that will start this year. There's actually 3 of them right now, 1 in commercial and 2 of them in defense. The one in defense is right around the corner. Like I'd like to think we'll see some revenue starting in Q2. The commercial one is early deliveries might start in Q2, but then it will start to crank up in Q3 and going into Q4. And the other one, I'm just not sure yet.

You mentioned potentially increasing the Waveguide production before fully developing smart glasses use cases. What gives you the confidence to expect an accelerated adoption in that area? Do you have any initial interest, whether it be pilots or prototypes, that has encouraged you to invest further in that part of the business?

Yes, we do have some cases where the interest is more than preliminary. We are actually in negotiations and related discussions. Additionally, we have a great relationship with one of the largest ODMs globally who is fully committed to collaborating with us. Looking ahead to the remainder of this year and into next year, we have strong expectations for significant success in this area as well.

On the cost reductions, Grant, considering both the decrease in actual headcount and the stock grants or restricted stock instead of cash payments, how should we evaluate their impact on the cost structure from a seasonal or linear standpoint? Should we expect it to continue decreasing throughout the year, with Q1 representing a peak for those line items on the OpEx side? Are there other factors we should consider that might partially counteract this gradual reduction?

The salary deferral plan is set to begin in the first week of May, covering two-thirds of a quarter. The $1.6 million can be spread evenly over a year, which accounts for two months and the remainder allocated each quarter until the second quarter of 2025. We have implemented some cost-cutting measures earlier this year and are planning more, which will involve further headcount reductions. We will begin to see the impact of these changes starting in the third quarter, with some effects in the second quarter, but most will manifest in the third quarter. Our target is to achieve a pure cash expense for operating expenses exceeding $4 million per quarter, ideally around $4.5 million, which is a 35% reduction in cash expenses compared to the same period in 2023.

Thank you. This does end the Q&A session. I would now like to hand the call back over to Paul Travers for closing remarks.

Thank you, Darryl. Thank you, everyone. I appreciate your interest and participation in today's call. We anticipate an exciting remainder of the year with many great opportunities unfolding for Vuzix. It promises to be wonderful. We also look forward to seeing you at our Annual Shareholders Meeting for those who can attend on June 13 here in Rochester, New York. Have a good evening, everyone.

Thank you. That does conclude today's teleconference. We appreciate your participation. You may disconnect your lines at this time. Enjoy the rest of your day.