Rank One Computing (NASDAQ:ROC) reported first-quarter financial results on Thursday. The transcript from the company's first-quarter earnings call has been provided below.
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Summary
Rank One Computing reported a first-quarter revenue of $2.5 million, a decrease of 20% year-over-year, primarily due to lower R&D contract revenue.
Product revenue decreased by 5% year-over-year, with significant growth in Rock Watch (77%) and Rock Abus (255%), while Rock SDK and Rock N Roll saw declines.
The company emphasized its strategic focus on expanding its Vision AI platform within national security, public safety, digital identity, and physical security markets, leveraging its U.S.-built technology.
Management noted the impact of the previous U.S. government shutdown on its operations but expressed optimism about the current federal fiscal environment and its potential to boost procurement activity.
Rank One Computing's gross margin remained strong at 79%, reflecting its software-driven model, and it plans to invest in R&D, sales, and infrastructure to support long-term growth.
The company completed its IPO, raising $21.5 million, and ended the quarter with $16.6 million in cash, positioning it well for future investments in product development and market expansion.
Full Transcript
OPERATOR
Greetings and welcome to the Rock first quarter 2026 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 a question and answer session. To ask a question you may press star then one on a touch tone phone. To withdraw your question, please press star then two. As a reminder, this conference is being recorded. I would now like to turn the conference over to Rory Remour with CORIR Investor Relations. Please go ahead.
Rory Remour (Investor Relations)
Thank you and good afternoon everyone. We thank you for joining Rank One Computing's first quarter 2026 financial results call. Presenting on today's call are Scott Swan, Rank One Computing's CEO and Cody Barnes, Rank One Computing's CFO. Brighton Claire, Rank One Computing's Co-Founder and Chairman of the Board of Directors will also be available during the question and answer portion of the call. Before we begin, I remind everyone that today's call may contain certain statements that constitute forward looking statements within the meaning of the Private Securities Litigation Reform act of 1995. These include remarks about management's future expectations, beliefs, estimates, plans and prospects. Such statements are subject to a variety of risks, uncertainties and other factors that could cause actual results to differ materially from those indicated or implied by such statements. Such risks and other factors are set forth in our Quarterly report on Form 10Q filed with the securities and Exchange Commission. We do not undertake any duty to update such forward looking statements. Additionally, during today's call we may discuss certain non GAAP measures which we believe are useful in evaluating our performance. The presentation of this additional information should not be considered in isolation or as a substitute for results prepared in accordance with US gaap. It's now my pleasure to turn the call over to rocc's CEO Scott Swan.
Scott Swan (Chief Executive Officer)
Thank you Rory. Good afternoon and thank you for joining us for Rank One Computing's first quarter 2026 earnings call, our first as a public company. Before Cody reviews our financial results, I want to spend a few minutes introducing Rank One Computing, explaining how we think about the market opportunity in front of us and framing the strategy we are executing as a newly public company. Rank One Computing is a US built, owned and operated vision AI company focused on identity security and digital forensics. At its core, our technology helps customers transform visual data into operational intelligence. We help verify identity, detect threats, analyze evidence and support faster, more informed decisions in mission critical environments. Said another way, Rank One Computing's technology is analyzing, extracting meaning from raw pixels and visual data. That includes biometrics, video analytics, object detection and digital evidence. These capabilities support military, law enforcement, national security, financial technology, public safety and commercial security customers tasked with protecting people, infrastructure and sensitive systems. We operate in markets where accuracy, speed, trust and control of the technology stack are critical. Our customers are not buying experimental or proof of concept AI. They are deploying operational technology in environments where performance matters and where failure is not acceptable. The simplest way to understand Rank One Computing is this: we combine biometrics, video analytics, object detection and digital evidence into a unified vision AI platform. Instead of offering a single point solution, our platform is designed to support multiple identity and intelligence use cases utilizing the same layer underlying technology architecture. That matters because the market is moving toward convergence. Identity, video, physical security, digital evidence and mission intelligence are no longer separate categories. Customers increasingly need systems that work together, share intelligence and scale across agencies, facilities and operating environments. ROP was built for that environment. A major part of our differentiation is that our technology is developed here in the United States in national security, public safety and identity infrastructure. That is not just a branding point, it is a strategic requirement. Much of the global identity and biometric technology market has historically been served by large foreign incumbents. Rank One Computing was founded to provide a domestic alternative with accuracy, efficiency, security and scalability required for the most demanding applications and our solutions have been built by the people who have lived the mission. Our team was forged in real world crisis from September 11th to the Boston Marathon bombing to Iraq and Afghanistan and covert operations with operators, scientists and engineers from the military and FBI, people who carried the mission and now build the tools to win it. Our platform serves four major mission areas: national security, public safety, digital identity and physical security. Within those markets, we commercialize a portfolio of products built on the same underlying technology. Foundation Rank One Computing is the foundation of our platform. It allows customers and partners to integrate our biometric and recognition technology directly into their own applications. Rank One Watch is our video intelligence platform. Cameras are everywhere, but most camera systems remain passive. Rank One Watch turns video into actionable intelligence through real time analytics, visitor management, threat detection and post event investigation capabilities. Rank One Watch is one of the largest contributors to our product revenue and in the first quarter Rank One Watch revenue increased 77% year over year. Driving this growth were two expanded programs within the Department of War demonstrating our land and expand business model. In addition, we secured a new Rank One Watch contract with a US University signaling early traction from the growing demand in the early security market. Rank One ABIS is our Automated Biometric Identification system. This is a national scale biometric identity platform designed for large scale matching and verification. We believe ABIS represents one of the most important long term opportunities for Rank One Computing because these systems can become deeply embedded infrastructure for government and public safety customers. In the first quarter, Rank One ABIS revenue increased 255% year over year from a small base reflecting early commercialization and deployment activity. In March, we launched the first Rank One ABIS Forensics Capability pilot with a state and local law enforcement customer. Rank One Computing Evidence is our digital investigations platform. It is designed to help customers manage, analyze and act on evidence in real world investigative environments. We believe Rank One Computing Evidence can become an important part of our public safety and digital forensic strategy as customers look for more efficient ways to handle growing volumes of digital information. In fact, in April we deployed our first Rank One Computing Evidence program for the United States Drug Enforcement Agency to support the Agency's digital evidence management procedure. Rank One Access supports identity onboarding and verification, turning a simple image capture into a secure biometric identity workflow. And finally, Rank One Computing Access is our entry into the Intelligent Physical Access Control, our first hardware device. Rank One Computing Access Phase 1 combines biometric identity verification with embedded security intelligence at the point of entry. In March, Rank One Access Phase 1 was recognized by the ISC West, which we believe reinforces the market relevance of bringing Rank One Computing's Vision AI capabilities into access control. Importantly, these products are not disconnected offerings, they are built to operate on the same underlying platform and the platform structure is central to how we believe Rank One Computing can scale. Our financial model is moving toward a product led programmatic recurring revenue profile. R and D contracts will remain an important part of our business, particularly because they help fund innovation and deepen our relationships with government customers. But over time, our objective is to materially increase the contribution from productized software, platform deployments and longer duration customer programs. That shift is important because it enables the broad scalability of the business. In the first quarter, product revenue represented the majority of total revenue. Within product revenue, Rank One Watch grew 77% year over year and Rank One ABIS grew 255% year over year, demonstrating continued adoption into two product areas we believe will become meaningfully long term growth drivers and where we expect to emerge as dominant market leaders. At the same time, our 79% gross margin reflects the software driven economics of our platform and the operating leverage we believe will follow as product deployment scale. The way we build our product driven revenue base is straightforward. We land, we expand and then we compound. We often begin with a pilot, an initial deployment or a specific customer use case. As those deployments prove their value, they can expand into broader programs across additional locations, agencies, workflows or product modules. Over time, the goal is for Rank One Computing Identity and intelligence technology to become the embedded operating infrastructure for our customers. It is not a one time tool but a system they rely on every day. That is how pilots become programs. Programs can become systems of record and systems of records can create long duration, more predictable revenue opportunities. This is also why contract durability matters. Across our product portfolio, certain opportunities support multi year contract structures including 3 to 5 year and 5 to 10 year contractual programs depending on the product, customer and deployment model. We believe that creates a foundation for improved visibility, recurring or repeatable revenue and stronger long term operating leverage as the business scales. Our capital allocation strategy is closely aligned with that model. We are investing to scale what is already working: engineering, product development, customer success, deployment capacity, business development and compute infrastructure. The objective is to shorten time to deployment, accelerate time to long duration recurring revenue, support larger programs and preserve the margin discipline that is central to our model. So when investors think about Rank One Computing, we want them to understand the model clearly. Mission critical technology, software level, gross margins, product led expansion, longer duration, program opportunities and a platform designed to compound over time. The first quarter began a transition period for Rank One Computing. We completed our IPO, commenced trading on the NASDAQ, strengthened our balance sheet and continued advancing our product and commercial growth strategy. At the same time, our reported revenue was impacted by lower R and D contract activity and public sector procurement timing, including the lingering effects from the late 2025 federal funding lapse resulting from the US government shutdown. We believe the resolution of the government shutdown and the approval of DHS appropriations in April were important positive developments for the broader federal procurement environment. Earlier this year, many agencies were operating under continuing resolution dynamics and broader budget uncertainty which slows procurement, new program starts and award execution. Since appropriations were finalized, we have seen what we would describe as a healthier and more normalized federal budget environment across several areas relevant to Rank One Computing. Importantly, we are now operating within typical federal fiscal year window where agencies are actively working to obligate fiscal year 2026 funding prior to September 30 year end. Historically, that environment accelerates procurement activity, evaluations, pilot transitions and contract execution timelines and particularly in mission critical areas tied to national security, public safety, identity modernization and AI enabled operational capabilities. Where Rank One Computing operates from a demand standpoint, we continue to see strong interest across our core markets including biometrics, digital evidence, real time video and analytics, border and access control applications, and broader visionary platform opportunities. We believe the strategic relevance of trusted and sovereign AI solutions is continuing to gain traction within sensitive government environments where performance, transparency and operational trust matters. We also continue to monitor developments on Capitol Hill and broader national security funding priorities, but overall, we view the current funding backdrop as constructive for our industry's customer engagement, pipeline activity and demand momentum through the balance of 2026. Crucially, we do not view the long term demand any differently. We continue to see strong demand for our trusted American built vision AI across government, public safety, digital identity and commercial security markets. Our focus now is execution, converting product adoption into larger deployments, expanding active programs, and judiciously deploying capital to support scale across the enterprise. With that overview, I'll turn the call over to Cody Barnes, our Chief Financial Officer, to review the first quarter financial results.
Cody Barnes (Chief Financial Officer)
Thank you Scott and good afternoon everyone. I will now provide a brief overview of our financial Results for the first quarter ended March 31, 2026. Total revenue for the first quarter of 2026 was $2.5 million compared to 3.2 million in the first quarter of 2025, a decrease of approximately 0.6 million or 20%. Product revenue was 2.3 million compared to 2.4 million in the prior year quarter, a decrease of 0.1 million or 5%. The decrease in product revenue primarily reflected lower revenue from Rank One SDK and Rank One Access, partially offset by growth in Rank One Watch and Rank One ABIS. Rank One Watch revenue in the first quarter increased 77% year over year, reflecting continued customer adoption and expansion of active deployments. Rock Avis revenue in the Same period increased 255% year over year, reflecting early commercialization and customer deployment activity. R&D contract revenue was 0.2 million compared to 0.7 million in the first quarter of 2025, a decrease of 0.5 million or 69%. The decrease was primarily attributed to the completion of a significant prior year R&D program, with new R&D contract activity in the current quarter occurring at a smaller scale. As Scott mentioned, the pace of new contract awards and customer order placement during the quarter was affected by the lingering effects of the US federal government funding lapse that occurred from October 1, 2025 through November 12, 2025. Although the funding lapse ended prior to the start of the first quarter, it constrained federal procurement and contracting activity through late 2025, which delayed certain customer purchasing decisions, contract awards, and program authorizations that we believe would have otherwise advanced during the quarter. Gross profit was 2 million in the first quarter of 2026 compared to 2.5 million in the first quarter 2025. Gross margin was 79%, consistent with the prior year period. We believe this reflects the strength of our software driven revenue model and the efficiency of our vision AI platform operating expenses were 5 million in the first quarter 2026 compared to 3.5 million in the first quarter 2025. Selling general administrative expenses were 2.9 million compared to 2 million in the prior year period. The increase was primarily driven by higher personnel related costs across product development, business development and operations and incremental public company costs. Research and development expenses were 2.1 million compared to 1.6 million in the first quarter 2025. The increase reflects continued investment in product development and platform enhancement. Net loss for the first quarter of 2026 was 3 million compared to a net loss of 0.7 million in the first quarter 2025. Basic and diluted net loss per share was $0.18 compared to $0.05 in the prior year period. As of March 31, 2026, we had $16.6 million in cash. Net proceeds from our IPO and the partial exercise of the underwriters over allotment option totaled 21.5 million. We believe our balance sheet provides the flexibility to continue investing in product development and deployment capacity, customer acquisition and the infrastructure required to support larger, longer duration programs. With that, I'll turn the call back to Scott.
Scott Swan (Chief Executive Officer)
Thank you Cody. So in closing with a strengthened balance sheet, we continued investing in the people, the products and the infrastructure needed to support Rank One Computing's next phase of growth. During the quarter we saw continued momentum in key areas of our product portfolio, particularly Rank One Watch and Rank One ABIS. While R&D contract revenue was lower in the first quarter, the underlying demand environment for trusted identity, security and intelligence technology remains strong. Our strategy is straightforward. Deploy our mission critical vision AI in markets where performance, trust and control of the technology stack matter. Focus on providing American built technology in areas that are central to national security, public public safety, digital identity and physical security. Implement a land and expand model designed to convert initial deployments into broader programs with durable recurring revenue and invest with discipline to support high margin long duration revenue opportunities over time. We believe this is the right model for ROC is a product led. It is platform driven and is focused on turning customer adoption into into durable programs that compound revenue over time. Rank One Computing's opportunity is not simply to sell software modules. Our opportunity has become part of the operating infrastructure that customers rely on to verify identity, detect threats, analyze evidence and make decisions. This is the long term value proposition of roc. We believe we have the technology, the team, the customer base and balance sheet to execute against that opportunity. We appreciate the support of our shareholders, customers, partners and employees as we continue building ROC as a public company and we look forward to providing updates on our developments in due course. Thank you for joining us today. I'd like to now hand the call to the operator to begin the question answer sessions with our recovering analysts.
OPERATOR
Thank you. We will now begin the question and answer session. To ask a question, you may press star then one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. The first question today comes from Yifu Lee with StoneX. Please go ahead.
Yifu Lee (Equity Analyst)
Thank you for taking my question. Congrats on a strong growth on the Rank One Watch and ABIS product despite navigating through a challenging partial government shutdown while balancing obviously the initial public offering as a public company. So Scott, I just want to start with you first on the macro environment. Obviously we're navigating through ongoing geopolitical conflict, high oil prices, interest rate that doesn't seem to go anywhere. However, as of April 30, the longest partial government shutdown impacting the Department of Homeland Security has officially ended. Just want to get your sense on like Scott, like the market after the government shutdown has ended. Has the public sector been stabilized? What are you seeing now that we're in midway through the second quarter in terms of thinking things turning?
Scott Swan (Chief Executive Officer)
Yes, thank you. We're very optimistic about the current signals that we are seeing. As you alluded, not only was there a government shutdown, but there was also no official budget passed in 2025. And now we are on a routine fiscal year where there is is budgets that seem to be very healthy within the federal government and they will need to obligate funds much of those funds before September 30th of this year. So while we see internally some lumpiness in the awards here at Rock, we do feel very optimistic about the communications and the growth of our pipeline for being able to be well positioned to support the federal government and public sector throughout 2026.
Yifu Lee (Equity Analyst)
Is it fair to say like Scott, I know you know, like after the, you know, reopening I guess. Right. That you know, like you need to build momentum pipeline. Right. It doesn't things contract doesn't get signed the next day. Right. Obviously. Right. Is it fair to say because the federal government budget, as we all know we cover software like in September 30th that what in terms of the timing perspective, does it make more sense that you would expect the flush to come in the third quarter in I'm just trying to match the expectations.
Scott Swan (Chief Executive Officer)
Yeah, I think that's very observant. I think we can likely see much more activity in Q2 with probably more of a surge in Q3 as you allude to. It takes time for the government money to move as a new budget was finally released. That has to work itself from treasury to the department level, down to the specific agencies that actually execute against that money. That process takes time. And then there's the interaction with the vendor to actually get the contracts or funding on existing contracts in some cases moved. All that takes time and the government doesn't move incredibly fast. So I think you're very observant to recognize that it will probably for 2026 for most federal contractors there'll be more late awards than you would see in other years.
Yifu Lee (Equity Analyst)
But you would envision the budget is, if not the same as last year, even more healthier. Is that correct, Scott, to make that assumption?
Scott Swan (Chief Executive Officer)
Yeah. That information is all public information. And from our observations it looks as if that the federal agencies are well funded this year, even more so than last year.
Yifu Lee (Equity Analyst)
Yeah. And they're. I'm sorry, I mean they're further focused on our priorities that we're developing for national security and US Nascency and the reauthorization of the CBER program, you know, which have been stopped, you know, is pretty important signal for us as well. Okay, thanks guys. And then let's move on to the pipeline. Obviously like Rank One Watch up 77% and ABIS up 2.55x. So it's looking strong there. And obviously you have your first deployment on evidence as well as the launch of Rank One Access. Just want to get your sense, Scott, Cody, Brendan and team on the pipeline. What are you seeing? Your pipeline right now that you're working on, like what are like the near term opportunities with, you know, you intend to, let's just say convert because we all understand this is your year of ipo. You're still laying the foundation. Chances are there's going to be, you know, greater momentum next year. But what are the low hanging fruits? Let's just say that you feel, you know, more confident that you could get in the near term. Can you comment on those?
Scott Swan (Chief Executive Officer)
Yes, I can. You know, in 2025, at the end of 25 we were at market with one product which was Rank One ComputingKW. And so we landed some of our early wins in that space. And this year we're still in a land phase but we are starting to expand with that particular product to really achieve what we hope to be some of that longer duration ARR type contracts. But we come to Market this year with three additional products. Our goal for this year is to establish the beachhead contracts and players in that space. So we will be in that land phase for our other product elements. As we, as we mentioned, we do have some early rock Abus wins. We had our first Rank One Computing Evidence customer in April of this year and we're looking for expansion into those particular areas into larger contracts. So we think our goal is to have beachhead customers across our entire product portfolio within the Vision AI platform in 2026.
Yifu Lee (Equity Analyst)
I know like during the IPO process when we do our due diligence, ABIS is the product where if you land you're going to win big. These could be seven, even eight figure contracts. We weren't expecting like, you know, you guys already make great headway into this product. Can you elaborate how did you pull forward the adoption of ADIs? You just launched it and it's already gaining great traction there.
Scott Swan (Chief Executive Officer)
That's right. We achieved a lot of our development of the Vision AI platform prior to going public. So as we have been able to start applying that capital, we've been able to scale the business and more complete those particular products and go to market. But we have been working on our pipeline opportunities for some amount of time, even pre IPO and you know, a lot of our opportunities are tied to the government's natural process for recompeting contracts. A majority of the federal contracts right now, especially in the Abus market, are in some stage of market research or already starting recompete efforts. So we have our targets in mind within the federal space, especially of the areas where we are trying to win business in 2026 and then across the rest of the sectors and the other products, we also have very specific targets in mind that we will be working toward in 2026.
Yifu Lee (Equity Analyst)
So is it fair to say, like Scott, like most of your portfolio is government heavy and then on the commercial side I remember you mentioned like telecom as well as Fintech are certain engagements you're working on. Maybe give us a little bit more color if you can on those as well.
Scott Swan (Chief Executive Officer)
Yes. Late in 2025 we hired our channel manager within the commercial security market and we have had some early wins in that space. As we mentioned, we won the innovation award for Biometrics at the ISC west with our Rank One Access product. We are well into further business development in those particular spaces. In the commercial market expanding several of the channel partners have been established and now we are looking to grow that channel in those spaces. In the telecom space, we have seen some uptick in volumes with one of our large customers for the Telcom SIM card registration process. And we will continue to monitor that market to understand how that might impact our growth in 2026.
Yifu Lee (Equity Analyst)
Is there any like timing on that on the telecom? Like would it be a second half, fourth quarter, third quarter?
Scott Swan (Chief Executive Officer)
There's no key timing that we're eyeing there. You know, we see sustained growth in that side, but it's not the area that we consider most optimistic. You know, relative to watch ABIS and the evidence. You know, an software development kit always has exposure there. You know, if you look at the, the latent effects of the government shutdown, you know, what that hit the most was software development kit and R&D contracts. So you see, you know, our software development kit has always been spotty and transactional in nature, really outside of the telecoms and the fintech use cases that we support there and that that has fit a nice pattern, you know, continued incremental growth.
Yifu Lee (Equity Analyst)
Got it. And then Gary Lacks, I just want to, you know, get some color. Like, you know, obviously he's a veteran, may have worked with you, Scott, as well at Demia previously. Can you comment on like maybe his priorities first hundred days? It sounds like you guys want to, I guess institutionalize a sales and marketing function. You know, how, how will he play a, you know, instrumental role in this?
Scott Swan (Chief Executive Officer)
Yes, Gary Lack has a tremendous amount of experience within the entire identity ecosystem, but specifically in the AFIS ABIS market. He has worked at many of the larger foreign providers in this particular space. Gary is also technical in nature. I think an area of particular importance is the go to market strategies that Gary will assist us with. His ability to bridge between our engineers and our marketing team to ensure that we have the right go to market messaging, the right components to really represent the products that we're building, I think will go quite a way and then very specific strategy in the AFIS ABIS space to assist us in how that go to market will really come to fruition in 2026 and beyond.
Yifu Lee (Equity Analyst)
Got it, Got it. And then Scott, I understand you know, you previously worked at Idemia and obviously the recent headline, obviously, you know, a travel agent, travel management software company, Amadeus acquisition. Have you seen any changes, control disruption that you may think that ROK can take advantage of because of MA disruptions in the market?
Scott Swan (Chief Executive Officer)
Yeah, we view this as optimistic. You know, our focus is on our strategy and given that particular acquisition, I think it only strengthens our strategy with respect to trying to create the domestic capability to be able to provide identity technologies to the rest of the world as American growing capabilities. I think in that particular space acquisition tends to have a slowness in research, a slowness in really being able to get a lot accomplished. That particular activity probably won't be complete until summer of next year. So there's a window here of opportunity for ROC to really accelerate our go to market focus on the strategy that we've always laid out here for us. And we still remain, to our knowledge, really the only US provider of these identity technologies across the capabilities that we're trying to serve with this vision AI platform.
Yifu Lee (Equity Analyst)
Thanks for that, Scott. I just want to squeeze in one technology question for Brandon before I move on to Cody on the financial side. Hey, Brandon, you know, like, obviously AI Labs has, you know, I would say like command a lot of the mind shares lately. How would you, for the newer investors on the call, like, how would you characterize the defensibility of Rock's platform against the likes of, you know, the LLM providers in terms of technology moves?
Brendan
Yeah, absolutely. You know, what we build is different architecturally from a machine learning perspective than large language models. They're much, much more efficient and precise at the computer vision tasks that our customers need us to perform, where, you know, massive scale identity databases or hundreds of thousands of cameras, you know, looking for weapons, we see just the cost of compute, the cost of memory. All these things continue to run higher. It's because large language modelss are very inefficient. They're also not that precise in general as well. This is our core pedigree. There is areas that we use large language modelss currently, they're part of our strategy. But we don't see anything changing anywhere in the foreseeable future in terms of how we build our algorithms. We see this as a strength too, relative to legacy competitors of ours out there. We're much further down sort of the deep tech compute stack. And then we're pulling in some of these nascent capabilities as well. But we're not following what we see as maybe pitfalls for solutions to certain problems on the resource intense nature of large language models.
Yifu Lee (Equity Analyst)
That makes sense. Thanks for that. Brendan And Cody, just to wrap it up on the financial side, obviously we've seen some headwinds on the government contract, but the shutdown has reverted. It's been back. Government's back in business. Was wondering if you could give us some like, you know, like soft guardrails in terms of like, you know, what do you expect your expectation for 2026 now that, you know, the government's back in business. And final question, is obviously with the capital raise, I think you still have $16.6 million on your balance sheet. Your thoughts on the capital allocation? I know Scott mentioned about hiring talents as well as investing in the infrastructure. Just want to get your take and that's it for me. Thank you, guys.
Cody Barnes (Chief Financial Officer)
Yeah, thanks for that question. So, you know, I think, you know, Scott, I think spoke to it really, really well. There's just going to be some inherent lumpiness, especially driven by some of the more legacy, you know, SDK component business and the government R and D contracts. Overall, we're encouraged as we look forward to the subsequent quarters from our perspective. And I think again, Scott and Brendan spoke really, really well about this. We don't see any sort of structural changes in the opportunity funnel. So overall, we're encouraged as the government dynamics play out and we are encouraged to see some more activity pick up in Q2 and throughout later this year from an overall capital allocation perspective. I think overall we transformed our balance sheet with the ipo. We're very well capitalized. We're focused in deploying capital into really four primary areas. Engineering and R and D, business development and sales, deployment infrastructure and algorithm compute capability. So, you know, our investment is focused on scaling what is working. We'll continue to pay attention to how, you know, the opportunity funnel converts over multiple quarters. But we're encouraged on the direction.
Yifu Lee (Equity Analyst)
Thank you for that team. And just a reminder for the general public, we are hosting the management team of ROCC tomorrow. So if you want to get connected with the team, happy to facilitate. Thank you guys and congrats on the ipo.
Cody Barnes (Chief Financial Officer)
Thank you.
Disclaimer: This transcript is provided for informational purposes only. While we strive for accuracy, there may be errors or omissions in this automated transcription. For official company statements and financial information, please refer to the company's SEC filings and official press releases. Corporate participants' and analysts' statements reflect their views as of the date of this call and are subject to change without notice.
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