Datavault AI, Inc. (NASDAQ:DVLT) reported its second-quarter financial results after Tuesday’s closing bell.
Below are the transcripts from the Q2 earnings call held Wednesday morning.
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OPERATOR:
Welcome to the DataVault AI Second Quarter Earnings Conference call. All participants will be in listen only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today’s presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded.
I would now like to turn the conference over to Susan Zhu with Alliance Advisors Investor Relations. Please go ahead.
Susan Zhu – Alliance Advisors Investment Relations
Good morning and welcome to Datavault AI Business Update conference call. Again, I’m Susan Zhu with Alliance Advisors Investment Relations. And as a reminder, today’s call is being recorded. Before we begin the call, I’d like to remind everyone that we will be making certain forward looking statements which are subject to various risks and uncertainties that could cause our actual results to differ materially from these statements. Any such forward looking statements should be considered in conjunction with the cautionary statements in our press release and risk factors discussed in our filings with the SEC. Data Vault AI assumes no obligation to update any of these forward looking statements except as required by law. Please refer to slide two of today’s accompanying presentation for more information. With us today are Nate Bradley, CEO of Data Vault AI, and Brett Moyer, cfo. With that, I’ll turn the call over to Nate. Please go ahead, Nate.
Nate Bradley (Chief Executive Officer)
Thank you everyone. It’s a very exciting day here at Datavault AI. We have made a number of key milestones come to fruition. If you look at our business products and our revenue derived from. We’re really excited about the results of the second quarter. We missed being able to book or to recognize revenue that we have booked around licensing transaction with Nayax. I would say the value of the transaction is actually much greater in our eyes. It actually unlocks the value of our company in a big way. So we’re really excited about that relationship more than anything and what it creates for us moving forward. So that was quite a triumph with respect to the revenue generation and our kind of penny test, if you will, as we move forward into much larger scale. Moving forward, so you can see the sequential growth. I’d mentioned that there’s a seminal event in the United States with respect to the passage of the Genius Act. This opened up large scale licensing opportunities in the US Banking industry. Data Vault is pursuing a number of things. We have a very special patent position in the marketplace. We are unlike many companies that compete in AI and data and data monetization. We are a company that relies on proprietary technology. We actually have a sovereign right to particular capabilities and systems that we’ve built over time. We’ve also brought in high end litigation and development teams around our portfolios At Fish and Richardson and Greenberg Traurig we have financial damages analysis underway. We’re looking at large US banking operations that have begun to use tokenomics and crypto management and custody. Several areas where they start to enter into needing an exchange that data vault AI offers. We have an exceptional product line that’s proprietary to us and we’re going to protect our proprietary rights across the world. And so doing that it’s a proposition where we are judicious about our expenditures there looking at contingency and blended contingencies that give us very little cash output but large cash opportunity for our shareholders and our stakeholders while not disrupting our core operations or our business management moving forward. So that’s a very developmental side of our business that’s going to continue to develop a lot of value for all the stakeholders involved. So we’re very excited about the progress we’ve made. We also have a standards based practice around Greenberg Trawig and their work with us around HD wireless transmission. A number of patents that we’ve received shout out to Joshua Paul who’s been prolific Mark Twain of patents who can capture so much. Brian Owens on our team deserves a lot of credit as well for bringing forth a portfolio here that has a standards body capability. We can partner with large corporations in that space and create a standard and start to monetize the WiSA portfolio in a way that probably others will be surprised at. And at a standards level the revenue is quite exceptional and high margin and we’re excited to activate that. So those are some of the key highlights of Q2 and as we move forward, you know, when you look forward to Q3 and what we’re looking to accomplish, we have an international elements exchange that we’ve announced. It’s captured the attention of the world. We have individuals and large mining and operations that are dealing with precious metals and elements including carbon credits and geothermal and other aspects that we’re beginning to use our rwa, our real world asset tokenomics and our ability to use any chain selected by our customers as a chain agnostic solution on blockchain and an AI powered system that as you may know is now Watson AI-powered. And with Watson X AI and IBM we have an exceptional engineering team and ability to deliver. That’s something Jeff Jones and our team has been really excited about. You know, our ability to scale our software Development and our customer acquisition and customer services through the IBM infrastructure. Really learning from the best and shadowing the best possible licensing partner you could have to train us on all aspects of the disciplines necessary in high cybersecurity, super compute and large scale deployments for our customers within those secure environments. So in 2025, you know, we’ve set out to acquire two companies. CSI was a successful acquisition, getting that under our belt. It’s, you know, been both an exceptional challenge and a pleasure working with individuals there. Mark Losarado deserves a mention on this call. He’s been organizing in tough circumstances, you know, the integration of data vaults, AI and the CSI team there and certainly the Williams and others involved, you know, Kael Williams deserves a mention there. Doing a good job communicating and getting things ramped up with the team there. That’s really quite exceptional. So we’re excited about the progress we’ve made with that acquisition and we look forward to a second acquisition. You may have seen that ATI Media has agreed to terms. We require a down payment in cash here in the next seven days that we intend to make and we have a strategy to close AT Media in that timeframe. That particular acquisition is something that is very hard fought and something that we’re building up. Being selected by ATI as a potential technology that accelerates their business. It’s something that’s quite an honor and something that we’re looking to, you know, build up our chops. Our company’s wherewithal to have such a selection be made. So we’re positioning the company to close. We’re really honored by the opportunity with API adding that to the exceptional assets of the company. If you look at the recent milestones, just this morning announcing the Q2 results, it’s a 467 year over year number. It has the $2.5 million booking, which was again the Nayax deal that gave us access to the NASDAQ financial framework, which unlocks our ability to launch exchanges using the data vault tokenomics, which is a patented system kind of stem to stern that we’re excited about and really is not reflected in these numbers with respect to its revenue generation capability. So turning that on carefully with IBM and looking at these exchanges, loading these exchanges with materials, our elements exchange, we’ve launched an nil exchange and a political exchange that will all have governance and systems around them that IBM’s AI makes possible, that the genius act unlocked and made legal in the United States to have such mechanisms. And so we’re carefully assembling that, working with Partners like IBM to, to make sure that all of that infrastructure is set up in a very professional way. We’ve also targeted some brand names that we’d like to name these exchanges after in honoring some major American brands that kind of deserve to be the namesakes of these exchanges. So we have an exciting trajectory there. We’ve made some announcements with respect to that. I mentioned ATI Media. That’s a milestone set for next week. Very important our company hits that milestone and I’ll explain how we get there. Our senior secured note that we just executed another $12 million financing August 20th. This gave us access to pulmonary cash and ability there. I’d like to thank Anson and SEG Opportunity Fund. I’d like to thank them for, you know, kind of a steadfast support of our company, a belief in us. That is really quite an honor. So we’re very thankful to them. And when you look at this, you know, the trajectory of our company. This is another injection of capital at the exact right time. You know, it is an ability for us to reach the promised land. The ability for us to move forward to our vision and execute at a level that we’re really excited about executing on IBM Platinum Partnership. We’re now a platinum partner there. That’s a big honor, something that we’ve obtained as a team. Jeff Jones, our engineering, the team in Atlanta, Sonia Choi. Getting us organized, capturing this unique opportunity and then exploiting it in a way that’s allowed us to bring major horsepower on board. The Nayax stays on the board as a major milestone because it’s an incredible unique opportunity. It’s patent backed and the cross license between us is exceptionally powerful. And the world’s about to see what that partnership can do. You also have the Dolby license where we’re able to use our WiSA technologies in conjunction with Dolby, create unique technologies in a space where we have dominated for many years in terms of engineering dominance and ownership of high definition spatial audio and transmission around that. That is extremely special, unique and powerful. It has a lot of Web3 implementations that data Vault is feasting on right now. Our engineers are working with very special toolboxes that belong to only us. We have a unique footprint. Verify U has risen as a very simple implementation of the very complex technology. It allows you to check someone’s credentials, whether someone served in a military operation, whether they were injured and received an award. All of the valor that we document around the world can be utilized with this technology. This technology can also protect colleges and universities and sports organizations like the NFL. Alumni I’d mentioned Billy Davis Healthcare leader over at NFL Alumni, a great partner, good person really helping our business expand and has a vision for the future but he also saw Verify Uy very early as a mechanism to help NFL players get their benefits to get their healthcare to get all of the things that he has organized at alumni on behalf of the NFL players and alumnus they are able to utilize a system that can prove their valor, prove what they have achieved and also receive the benefits owed to them. So there’s some very unique technologies I’d also mention on the right hand side the information data exchange drastically enhanced with the exchange of exchanges the Nil Exchange the ability to have the International Nil Exchange, our International Elements Exchange and American Political Exchange. These are exchanges that we’re launching on tried and true trusted infrastructure with IBM on the pricing and the mechanisms around our Data Value and Data Score agents our agency solutions that include Data Vault Bank a smart contracting solution that solves many.
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