THE THINKEQUITY CONFERENCE 2026 - ACTELIS NETWORKS INC

Explicit Guidance:

• FY2026 revenue outlook is described as "much better" following a <4M revenue year in 2025; Q1–Q2 2026 revenue is 2.1M, representing a 26% year-over-year increase, with bookings up 80%.
• FY2026 gross margin is expected to sustain levels around 51% following the 2025 disruption.
• No specific numerical revenue, EPS, or capital expenditure guidance is provided for periods beyond Q3 2026; however, the CFO states Q3 delivered a "significant order" to the U.S. Marine Corps.
• The company anticipates the realization of federal pipeline opportunities and program-of-record wins to begin materializing in revenue figures starting in 2027.

Business-Segment Outlook:

• Federal/Military: Expected to transition from sporadic project-based sales to programmatic, continuous revenue streams via "programs of record" (e.g., U.S. Marine Corps IP telephony upgrade of 65 buildings delivered in Sept 2023). The "Department of War" budget is identified as a >$1T market for modernization.
• Intelligent Transportation Systems (ITS) & Smart Cities: Active in 300+ U.S. cities (100k–1M population) tapping into budgets for modernizing road agencies and digital city infrastructure; targeting FAA projects following their $12B modernization budget and competing for work in NYC, Seattle, Washington DC, and Canadian Rail.
• Hospitality: Entering a new growth phase targeting the replacement of antiquated analog technologies in hotels and venues to enable multi-gigabit streaming; sales cycles are longer due to the need to keep rooms vacant during installation.
• Technology & Product: Continuous release of firmware updates with enhanced "cyber hardening" capabilities; expanding "Meta Shield" AI-based threat management and anomaly detection for OT (Operating Technology) environments to monitor 24/7 for unauthorized traffic or volume spikes.

Market and Competitive Outlook:

• Demand Trends: Anticipated surge in demand driven by the necessity to modernize "critical infrastructure" where fiber cannot be deployed (10–30% of locations), creating a structural need for hybrid fiber/copper/coax solutions that offer "fiber-grade" performance without rewiring.
• Competitive Landscape: Positioning against large players (Cisco, Juniper) in small-to-medium projects due to their inability to handle niche hybrid networking requirements; successfully competing against Adtran and Cisco in UK highway modernization (Phase 3 ongoing, started 2018).
• Structural Changes: Regulatory shifts, specifically the EU's Cyber Resilience Act (mandated for organizations in 2027) and U.S. FIPS compliance requirements for defense and civilian facilities, are driving demand for pre-hardened, FIPS-compliant equipment.
• Edge AI: The shift from cloud-based AI to edge computing for latency-critical applications (autonomous vehicles, robotics) is identified as a primary tailwind driving the need for local, low-latency networking infrastructure.

Macro / Industry Outlook:

• Regulatory: Increased compliance mandates (Cyber Resilience Act, FIPS) are expected to accelerate adoption rates as municipalities and educational facilities seek to mitigate ransomware risks and meet vulnerability-free requirements.
• Infrastructure Aging: A significant portion of existing infrastructure (copper from the 60s/50s, coax) is deemed "antiquated" and a "weakest link" in cybersecurity, necessitating urgent modernization rather than full replacement.
• Capital Markets: The company acknowledges a "terrible" 2025 but expects 2026 and 2027 to be turnaround years driven by federal program entry and market tailwinds.

Strategic Initiatives:

• M&A: Actively pursuing a synergistic acquisition targeting a company with a strong "cyber orientation" to facilitate inorganic growth and technological integration; a specific target is being evaluated.
• NASDAQ Re-listing: A strategic priority to return to the NASDAQ exchange, dependent on successful M&A execution and improved financial performance.
• Cost Management: Completion of restructuring and cost-reduction efforts initiated post-2025; shift toward "programmatic sales" and hiring new talent to secure long-term federal contracts.
• Product Evolution: Integration of AI intelligence into "Meta Shield" for centralized anomaly detection and auto-correction in OT environments.

Risks and Headwinds to Outlook:

• Implementation Delays: In the hospitality sector, modernization timelines are constrained by the operational necessity to keep venues open, potentially slowing revenue recognition.
• Hardware Obsolescence: Risk that legacy hardware purchased 5–8 years ago may not support new, cyber-hardened firmware versions, potentially limiting upsell opportunities to existing customers without hardware replacement.
• Sales Cycle Volatility: Dependence on large government "programs of record" implies long sales cycles before revenue recognition (expected 2027).
• Execution Risk: The timeline for M&A completion and the ability to successfully integrate a target company remain uncertain variables.

Management Tone on the Future:

• Confidence: Describes the 2026 outlook as "much better" and expresses hope that the Marine Corps deal is "one of many in the future."
• Strategic Pivot: Emphasizes a decisive shift from a "terrible 2025" to a systematic, efficient approach focused on federal programs and critical infrastructure.
• Differentiation: Highlights a unique position in hybrid networking (fiber/copper/coax) and cybersecurity, with a tone of assurance regarding the necessity of their technology for future-proofing critical infrastructure.

Miscellaneous:

• The company is "webcasted" for public viewing.
• The CFO also serves as CTO and Deputy CEO.
• No specific dividend or buyback plans are mentioned; focus is on operational turnaround and growth.