XTI Aerospace — Second Quarter 2026 Earnings Summary

Financial Performance

• Anticipated second quarter revenue of approximately $32.4 million.
• Anticipated gross profit of approximately $5.6 million.
• Anticipated loss from operations of approximately $9.1 million.
• Preliminary financial information is unaudited and subject to change upon completion of financial closing procedures and independent accounting firm review.
• Internal review initiated in July 2026 concluded with no financial misstatements discovered.

Guidance and Future Outlook

• Withdrawing previously issued 2026 financial guidance.
• Plans to provide a comprehensive update on 2026 guidance at a later date.
• On track to file Form 10-Q by October 26, 2026.
• Anticipates implementing enhancements to governance framework, policies, and procedures under Board oversight.

Business Segments and Product Lines

• Parent company of Drone Nerds, LLC, a drone solutions platform serving commercial, enterprise, and government customers.
• Supports sectors including public safety, agriculture, construction, and energy across the drone program lifecycle.
• Services include hardware sourcing, deployment, training, service, repair, and the Always Flying program.
• Positioned as a go-to-market partner for drone manufacturers and software developers scaling in the domestic market.

Market and Competitive Landscape

• Operates within the growing unmanned aircraft systems (UAS) industry.
• Faces risks related to increased competition, potential downward pressure on prices, fewer customer orders, and reduced margins.
• Risks include loss of market share and inability to take advantage of new business opportunities due to competition.

Risks and Challenges

• Substantial doubt about the ability to continue as a going concern is expected to be disclosed in the Form 10-Q.
• Risk of inability to file Form 10-Q or subsequent periodic reports, or failure to satisfy Nasdaq's continued listing requirements.
• Risk of stock suspension or delisting from the Nasdaq Capital Market.
• Risks include potential disruption of operations, cybersecurity threats, loss of key customers, and deterioration of employee relationships.
• Risks related to securing or protecting intellectual property and successfully integrating future acquisitions.
• Risk that additional information may affect previously issued financial statements or internal controls.

Management Commentary and Tone

• Jeremy Schneiderman, Interim CEO, stated the company is "better positioned to ensure that our corporate governance procedures meet the highest standards of compliance and transparency moving forward."
• Management expressed appreciation for the patience and support of employees, partners, customers, and shareholders during the internal review process.
• The Special Committee of independent directors oversaw the review with assistance from independent outside counsel.

Other Key Points

• The internal review was overseen by a special committee of independent directors of the Board of Directors.
• The Board intends to evaluate governance practices and may adopt additional measures as deemed appropriate.
• The press release includes a comprehensive cautionary statement regarding forward-looking statements and specific risks related to Nasdaq compliance and going concern status.