Research Frontiers Q3 2025 Earnings Call Transcript

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Provided by Quartr
November 6, 2025

Key Takeaways

  • Positive Sentiment: Strong response at Glass Build 2025 to the architectural retrofit system; initial target customers are governments (via GSA), embassies and commercial buildings, with follow-up demos planned at CES and GlassTech to build momentum.
  • Neutral Sentiment: Automotive royalties were temporarily reduced by accounting effects after a licensee bankruptcy and prepaid minimums, but royalties are higher year‑to‑date when one‑time 2024 events are backed out and Ferrari royalties should be fully recordable in Q4.
  • Neutral Sentiment: Company remains debt‑free with approximately $1.13M cash and $1.4M working capital as of Sept 30, 2025, and management says there are no current plans to raise capital unless another licensee bankruptcy occurs.
  • Positive Sentiment: Black SPD is described as "very, very far along" in development and the retrofit product is designed to be easily upgraded in the field, supporting future adoption for side windows and high‑end projects.
  • Positive Sentiment: Management highlighted SPD's competitive position — installed in tens of thousands of vehicles and aircraft — and increasing industry recognition, including the CEO being named keynote speaker and chair of the upcoming Automotive Glazing Conference.
AI Generated. May Contain Errors.
Earnings Conference Call
Research Frontiers Q3 2025
00:00 / 00:00

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Operator

Good afternoon and welcome to Research Frontiers' investor conference call to discuss the third-quarter 2025 results of operations and recent developments. The company will be answering many of the questions that were emailed to it prior to this conference call, either in their presentation or as part of the Q&A session at the end. In some cases, the company has responded directly to email questions prior to this call or will do so afterwards in order to answer more questions of general interest to shareholders of this call. Some statements today may contain forward-looking information identified by words such as expect, anticipate, and forecast. These reflect current beliefs, and actual results may differ materially from those expressed due to various risk factors, including those detailed in our SEC filings. Research Frontiers assumes no obligation to update or revise these statements.

Operator

Today's call is in listen-only mode with a Q&A session to follow. To ask a question, press star one. The call is being recorded and will be available for replay on Research Frontiers' website at smartglass.com for the next 90 days. During the question-and-answer portion of today's call, if you find that your question has been substantially answered, as a courtesy and to allow time for other shareholders to ask their questions, please remove yourself from the queue by pressing star two. Also, we ask that you keep your questions brief in the interest of time. Now, I'd like to turn the conference over to Joe Harary, President and Chief Executive Officer of Research Frontiers. Please go ahead, sir.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Thank you and hello, everyone, and welcome to our third quarter of 2025 investor conference call. Automotive and total royalties were up year-over-year and sequentially when we back out 1x events from 2024. As of the end of the third quarter, we remain debt-free with over $1.1 million in cash, and our working capital position remains solid. Our architectural retrofit system debuted this week at GlassBuild 2025 in Orlando. The show ended earlier today, so my voice may be a little hoarse from speaking with customers since Tuesday. We had an outstanding response. John Nelson had asked by email a few questions about the show. What was the response? Were there any orders obtained for either the retrofit or the IGU products?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

We had a steady stream for all three days of interested parties, John, and they were amazed at SPD's performance and the ease of installation and elegance of the design of the system. Full spec sheets for different configurations of SPD windows for architects, designers, and facility managers were handed out. John also asked, "How are you planning to market these products and to whom? Were any orders obtained?" Initial customers are expected to be the government. Buildings due to AIT Group's status as an approved GSA vendor, embassies across the world, and commercial buildings such as high-rises and office buildings. Homes are possible as well, and we are working together on some high-end projects there as well. We've also identified and are discussing specs for at least two major and highly visible projects.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

The idea for Glass Build and all of the shows and conferences we attend is to get the conversation started and for AIT Group, Gauzy, and RFI to have real-world demonstrations underway. We and our licensees plan to build on that momentum through major trade shows early this year. Even at the GlassTec 2026 show in Düsseldorf. That show is only held once every two years and is the largest glass industry event in the world. With respect to cars, we will also similarly build on momentum in the automotive market. As I noted on our last conference call, the bankruptcy of the original licensee supplying Ferrari and the shift of that business to another one of our long-standing licensees caused royalty income from strong Ferrari sales to be mostly absorbed by the high minimum annual royalties prepaid by that new supplier at the start of 2025.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

In real terms, because of the prepaid minimum annual royalties from two licensees absorbing the Ferrari sales royalties, and this was something that only first happened this year in our history, the switch from one licensee to another from an accounting standpoint reduced our reported automotive royalties this year by six figures. Even so, our royalties in Q3 and for the nine months after the one-time events are backed out from 2024 are higher than last year. Even with this and the Ferrari business split between two licensees for the first half of this year, because of the sales levels achieved in Q3, the MARs for this licensee have now been exceeded in Q3.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Some of our royalty income comes from this licensee in the third quarter, and all of the royalty income generated by Ferrari in the fourth quarter will now become recordable in full in the fourth quarter. We expect revenue in all market segments to increase further as several new car models and other products using the company's SPD Smart Glass technology are introduced into the market. Turning to our financial condition and liquidity, we continue to manage our resources effectively. As of September 30, 2025, we held approximately $1.13 million in cash and had working capital of $1.4 million. We remain debt-free. One shareholder, Jared, asked if we plan to raise additional capital. We do not currently plan to raise additional capital, assuming that we do not have a repeat of the Q2 licensee bankruptcies, and none are expected, by the way, and we collect what is owed to us.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

We have had interested investors approach us, so capital is available if we ever need it, but there's no current plans to raise funds. We continue to see progress and significant developments across our markets. Our SPD Smart technology is licensed or used by many major companies in five areas: aerospace, architectural, automotive, marine, and display products in almost every region of the world. We have had some very key developments within our industry since the last conference call. I can say we never had a more full pipeline of projects and opportunities. Some are medium term, and some are near term, with the timing and ability to announce more in our control. A good example is the architectural retrofit system. I was at GlassBuild in Orlando for its launch there this week by AIT. The show is outstanding.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

AIT Group, Gauzy, and RFI received enthusiastic responses to this, and we're working together to announce more details. In the architectural market, we'll be following it up with major shows in January, February, and perhaps several other shows after that, culminating with the GlassTec show in Düsseldorf in October. That show is the world's largest event for the glass industry and is held every two years. It gets considerable attention, just like Glass Build in Orlando did. We also expect to have SPD Smart Glass for the automotive, architectural, and aircraft markets in January at CES. In addition to all this, there is something really exciting later this month. As we announced in yesterday's press release, I am the keynote speaker at the Automotive Glazing Conference in Detroit, November 18th and 19th.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

After being selected to give the keynote on Smart Glass, I am also quite honored to have also been named the chairman of the conference as well. I'm looking forward to an illustrious group of automakers, suppliers, and colleagues presenting and attending that conference. These include executives and engineers from General Motors, Ford, Volkswagen, Stellantis, Lucid Motors, Jaguar Land Rover, Corning, Ferrari, Carlex Glass, Saint-Gobain Sekurit, NSG, Pilkington, Fuyao, Guardian Industries, Renault, Webasto, and others, representing the entire automotive glazing value chain from OEMs to tier 1 suppliers and glass innovators. As I mentioned, we included some questions previously sent in by our shareholders in our presentation today. I'll now answer some additional questions that have been emailed to us. Jared emailed in three questions. Are there any SPD retrofit wall installations? Is there a capital raise in the near future?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

How does Gauzy's prefab lam stack benefit SPD? I answered Jared's first two questions in my presentation earlier. Regarding the Gauzy pre-laminated stack, it benefits the SPD industry in multiple ways. It promotes consistency and quality among different manufacturers with different capabilities. It helps the customer be more able to easily interchange suppliers because of the consistency. It also enhances performance by using a combination of materials in conjunction with the SPD film to create an optimized stack in terms of UV and IR protection and optical clarity. It also speeds up production times by our licensees, minimizes costs from wasted materials, and other similar efficiencies of scale. Some other questions from John Nelson that were emailed to us prior to the call. Any update on the sunvisor, either aftermarket or built-in the windshield? John, since our last call, we have had more customer inquiries about this.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Some OEM activity as well. SPD black development status. John, I'll be talking about this in my closing remarks later. Is there much interest by automakers in developing SPD for side windows? Yes, John. Apart from Mercedes' concept van earlier this year, there is interest. This is one area that can greatly benefit from the black SPD. The sapphire blue SPD is perfectly fine for sunroofs, but I believe that the automakers want black or a more neutral-colored SPD, which is better suited for side windows. Steve Azar asked, "It was nice to see some price action in the stock of RFI a few weeks ago. Are we still lagging the market, and what will we need from RFI to see higher valuation going forward?" Thanks, Steve. As a shareholder myself, I too want to see higher stock prices. However, just one of the assumptions you made.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

When you back out the Magnificent Seven stocks, we're not lagging the small-cap market. Over the past six months, as of yesterday, RFI outperformed U.S. microcaps. We were at roughly 68% in the last six months versus 38% for the general microcap market. Next question from Steve Azar. Is anyone replacing Michael Lapointe from his recent retirement? We're not replacing Mike. He did a great job for us as VP of aerospace products and got many programs underway to the point where our licensees in the aircraft market and their teams of people are now able to carry the ball beautifully. Mike and I have spoken often in the past two months, and he's enjoying retirement and keeping busy, but he still keeps a close eye on things at Research Frontiers.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

I'll now ask our operator to open up the conference to any additional questions people participating today might have that we haven't already covered. We ask that you please keep your questions brief and limited to questions of general interest. If you want to get into more specifics, we could certainly do that by email or by telephone later. I plan to also cover a lot of exciting information and developments in my closing remarks. I may be addressing your question in more detail actually in my closing remarks, and we'll let you know if that's the case when you ask your questions.

Operator

If you'd like to ask a question, please press Star one on your phone now, and you'll be placed into the queue in the order received. Please be prepared and prompted. Again, Star one for a question, and we'll pause briefly to form our queue.

Operator

Our first question comes from James Le of RBC. Please go ahead.

James Le
James Le
Director, Data Management, Financial Crimes at RBC

Hey, Joe.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Hey, James.

James Le
James Le
Director, Data Management, Financial Crimes at RBC

I mean, this call is kind of like Groundhog Day, and it's the same call over and over again. I look at the five-year growth rate of the company at -3%. I'm just curious, where are all these car sales that you've been saying were going to be coming?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Okay. I try to go into a little bit of it, James. Ferrari has been doing very, very well for us, increasing the—

James Le
James Le
Director, Data Management, Financial Crimes at RBC

We know about Ferrari already, right?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Yeah. The accounting treatment when you had a licensee go bankrupt in the second quarter and another licensee step in and have to meet their minimum royalties before you can book new income is part of it.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

I expect, and in my closing remarks, I'm going to talk about some exciting things about what's coming in the automotive.

James Le
James Le
Director, Data Management, Financial Crimes at RBC

I mean, how many quarters ago did you announce that there was going to be a high-production car coming out? Was that two years ago?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

We'll be talking about that. We'll be talking about that. Things take a while in the automotive industry. We do it right as I think history has demonstrated. If you wouldn't mind holding the rest of your question for the closing remarks, and if I haven't answered them, you could always call me.

James Le
James Le
Director, Data Management, Financial Crimes at RBC

Okay.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

I'm happy to talk to you.

Operator

Next, we'll hear from John Nelson, an investor.

Operator

Hi, Joe. Just an idea, a kind of afterthought. Since the retrofit product is so, I would call it revolutionary. And since it is.

Operator

You've indicated it is production-ready. Would it make any sense to see if any of the new shows or podcasts would be interested in profiling your product?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Yeah. And we actually have a couple of those in discussion right now. What I want to do, I mean, the best way to experience the retrofit, John, is to actually see it work because it's incredibly easy and elegant. I mean, they did a—the AIT Group, which owns LTI, our licensee, has really just worked out so many what I'll call subtle details. For example, you pop this into a window frame, and you want to make sure that you're getting a good seal. You want to create an airspace to create even better energy efficiency. You want to make sure that there's no moisture in there that gets trapped. So a lot of things, and of course, the wiring.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

We actually are developing several different methods of wiring, including what I think is really, really exciting and quite doable, which is an autonomous window. What I mean by that is it's self-powered. You pop this into the window frame, and you don't have to call an electrician, and everything is there. When I was at the show in Orlando, as soon as I walked in, I was handed maybe a one-and-a-half-inch long key fob remote control. It's a 10 V remote control, no wires, and I was able to control the SPD windows and dim them and do all of the things. This was an off-the-shelf controller, which means you can actually substantially reduce costs by not requiring specialty electronics and also more easily integrate into building control systems.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

A lot of people use Lutron systems, so the fact that it works with the low-voltage Lutron stuff is very important too. These are the kind of things that we want to make more visual for people so that people could actually see how easy it is to work with. The harder you work, the easier and more elegant it looks. There has been a lot of hard work that Gauzy and AIT Group and Research Frontiers has put into this to make it look easy.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Are AIT Group and/or Gauzy producing a video demonstrating the product's qualities?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Yeah, they will be doing that and also appearing on podcasts and industry things. We hope to have some nice visual assets to kind of help spread the word better.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Also, one of the things that I found interesting at the GlassBuild show, first of all, it was extremely well attended by the right people. When you walked over to actually do the retrofit replacement, where you took out—and in this case, they had a large and heavy bullet-resistant glass window—you could just walk over. I saw one guy who was maybe half my size, easily put this in. Where the real benefit is, and it's kind of an interesting observation, is you can go in there in the course of a weekend and totally upgrade all the windows on a couple of floors of a building. They did one—it was not SPD, but it was for the White House. Unfortunately, you cannot close down the White House during the day.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

They said they had to go in there at 5:00 o'clock` and work till 2:00 A.M., and the Secret Service was there with their guns. Ready. They were able to upgrade the executive building in the White House with this system. It is quite, quite, quite easy to work with. We talked about distribution, which I think was one of your earlier questions about how we are going to market and deploy it. We talked about the marketing, but the deployment can be done with pretty much any installer. It is not a high skill to put this into a building once the system—because of the system. You could have groups of people all over the country just go do this. Think of it as a very elegant storm window, maybe.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Good. Thank you very much. That is all my questions.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

You are welcome, John. Thanks.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Thanks.

Operator

Next, we'll hear from investor Francis Cotturbo.

Operator

Hello, Joe. How's it going?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Hey, how's it going?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Pretty good. The installation in the White House, what was the actual product that they installed?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

That was an anti-eavesdropping bullet-resistant glass. Bullet-resistant, you understand. They can now do level 10, which means it could stop a 50 caliber round. They had some there. I wouldn't recommend standing near this stuff when it's being shot at. The anti-eavesdropping—you can shine a laser on a piece of glass. If you and I were talking in a room, the glass would vibrate, and someone from the outside might be able to shine a laser on the outside of the window and turn the vibrations back into sound, which is sometimes what's done in spycraft. This special film that.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

AIT Group and LTI can put in their windows, and they've done it for the CIA and others. And for embassies, prevents that from happening.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Okay. It's pretty cool stuff. Is that glass capable of having SPD on it?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Yes. Yes. That's a great follow-up question. The way it would work, let's say, I'm a facility manager or in charge of an embassy somewhere, the building of an embassy. We have existing glass, and I want to make it upgraded. What I would do is go on the GSA schedule, which is basically, if you're a GSA-approved vendor, the government can buy directly from you. It's almost like a Chinese menu. The plan with this is to have AIT Group have a whole different bunch of options for the retrofit. For example,

Joe Harary
Joe Harary
President and CEO at Research Frontiers

if I particularly wanted bullet-resistant glass, and I wanted bullet-resistant up to level eight or level six or level 10, and I wanted it to have the anti-eavesdropping glass, and I wanted it to have SPD, I just check a couple of boxes and order it. That's the idea. It's like a Chinese menu. If I didn't want the anti-eavesdropping, but I want the bullet-resistant and the SPD, I would just check those two boxes. Obviously, there's different prices for different things. That's the idea, is to make it very easy to deploy across the U.S. government.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

How capable is the supply chain setup for the architectural market? Is it right now being focused on the blue tint or the black tint?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Right now, everything is focused on the existing commercial film, which is the sapphire blue.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

One of the nice things about this retrofit system is, let's say next year the black comes out, and I happen to upgrade my embassy or my building with the blue. I said, "Money's no object. I really want the black." Someone comes in, and within the course of a weekend, can redo the whole building with the black. It makes it future-proof, which is great.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

How far along is the black?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

I'm going to talk about that in my closing remarks, but it's very, very far along.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Okay. You mentioned increasing sales with Ferrari. Whatever happened to Hyundai?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

I'm going to talk about that also, but it's still moving forward.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Still moving forward.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

What caused them, or whomever it was, to totally not follow through with the 2023 projection of us being greatly rewarded? What happened there?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

My understanding is it was partly because of the car itself, not the SPD part. I suspect that if you know that a black is coming, and you do not have a gun to your head to put the blue in the car, you might wait. Some automakers have expressed that, and some have not. It might have unintentionally caused a slowdown in some areas. For the most part, though, the sunroofs—for the most part, the sunroofs are fine with the blue. Things like side windows would prefer black.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Is there any difficulties in producing it? Do you have a good subscription setup?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

You mean the black or the retrofit? Or both?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Retrofit. Retrofit. Both.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Oh, no. No. No. Matter of fact, AIT Group has an entire building devoted to just the framing system for the retrofit.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

What about the supplying of the building?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

That is building number three.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

I'm told that building number four is waiting if they hit capacity in building number three. They have expansion room too.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Yeah. That's the frame. What about prior?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

The glass is—oh, they can do glass all the time.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Yeah. And the lamination?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Yeah. That's what AIT and LTI do, is they have a tremendous operation outside of Tampa in Largo, Florida, and they have another tremendous and even larger operation in Pittsfield, Massachusetts.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Who does the lamination?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

We don't expect them to. They do it.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Who does the lamination?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

It's all done in—

Joe Harary
Joe Harary
President and CEO at Research Frontiers

the lamination is done in Ellsworth?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Yeah. That's their specialty. Laminated Technologies, LTI, is the part of AIT Group that does and has done SPD lamination for licensees for a long time. They have very good experience.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

So Gauzy makes the film, ships it to them, and they do the rest?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

They laminate it. Right. Right. And Gauzy was at the show—yeah. Gauzy was at the show along with AIT and, of course, me.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

On our last conference call with Gauzy, they never even discussed SPD. Why did they not even address that? I found that to be somewhat odd. Would you have any answer to that?

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Yeah. And I've had this discussion with Gauzy. There's a very sexy, high-growth part of their business. That's their switchable film division. And they have a very bread-and-butter part of their business too, things like the safety tech division, which does the cameras for trucks and things like that. As a new public company, I guess they were advised to stick to kind of the more traditional way of presenting your company, which is, "Here are your revenues in each division.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Here's your EBITDA in each division. And they have about five different divisions, so they devote some time to it. From a shareholder value standpoint, I believe they would do much better focusing on the growth areas like SPD. And I've expressed that to them, and I think they're getting that message.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Okay. All right. Thanks, Joe.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

You're welcome. Thank you.

Operator

Once again, everyone, for a star one for a question. Yeah. We have no questions at this time. I'll turn it back over to you for any additional or closing comments.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Okay. Thanks a lot. If we haven't fully answered anyone's questions, either live or by email, please feel free to email us, and we're happy to talk to you. I'm going to put a lot more detail in my closing remarks.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

I think a lot of the questions that have been asked, you'll get a little bit more meat and flavor from it. Success rarely comes in a straight line, and how you navigate that path frequently determines the outcome. Some of our competitors never even crossed the finish line and went bankrupt. On our past conference calls together, I've told you about our retrofit application and about how the automotive industry views SPD as the best-performing and most reliable switchable tint technology. You're now seeing proof. What we discussed on earlier calls is materializing, sometimes not on the exact timeframe we were told, but consistently moving forward. The architectural retrofit application was presented this week at the most prestigious U.S. glass conference and will appear at additional major events worldwide. Our customers for the retrofit include both government and commercial entities.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

Direct adoption by the government offers a large opportunity. The GSA is the largest customer in the world. The government also promotes the use of SPD Smart Glass in the private sector through tax incentives such as the Dynamic Glass Act, which provides 30%-50% credits. Both of these should accelerate use, especially now with the ease and speed that an existing window can be made SPD smart. Yesterday's announcement about the Detroit conference, which incidentally is the same venue where we landed Cadillac years ago, and my selection as keynote speaker and chairman highlight our growing credibility in the automotive industry. Multiple markets and industries are now connecting the dots, and they've responded positively to SPD Smart Glass technology. This industry isn't easy. Automotive makers demand the best, and misinformation and overpromising and underdelivering from competitors is common.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

We counter that with the worldwide network of dedicated companies and the highest-performing smart glass technology. In the past year, two competitors went bankrupt. Another performed a cumulative 4 million to 1 reverse stock split, yet its stock still trades for pennies, was delisted, and they recently lost their CFO and COO. Another competitor was not able to supply an electrochromic sunroof that was announced by the car manufacturer with great fanfare. That roof option is still on "production constraint," and my visit to the dealership to see it resulted in the salesperson wondering if the roof was actually switching tint at all because of the very slow switching speed.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

He said at the end that I might be able to get the option on a car in "a couple of months." On October 24th, 2025, so not too long ago, on their third-quarter earnings call, the COO and CTO of Gentex Corporation, which incidentally is a company that I respect very, very much, noted the following. It is worth my reading his public comments in detail to understand the real challenges that companies face in trying to get a switchable tint product into the automotive industry. "Customer interest for dimmable sunroofs and visors continues to grow, and our teams have been working incredibly hard to continue moving this product from single-unit production into more mass-scale capability. As noted in prior calls, this is an incredibly complex and challenging manufacturing process.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

To date, we've been utilizing partners to execute part of the process while we get our largest-scale production equipment in-house and operational. The target is to have this in-house operation running in late Q1 to early Q2 2026. As with any new product or process launch, there will be challenges. With the manufacturing capability we have at Gentex, I remain confident in the team's ability to bring this product into the market in the next one and a half years." The question was then asked of Gentex, "What's left to be done in terms of achieving commercial viability? Where are you, and what's left to do? I know there's a lot of technicals that go into getting that OEM certified." Gentex responds, "Yes, there are some. There are still some of the bigger challenges.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

The requirements of taking that technology into automotive and meeting the environmental temperature, all of the above process requirements, as well as when you have a really large piece of glass with a darkened surface. It's easy to see small issues in the process that the dimming materials put down. That's the big part of the Q1 and Q2 of the next year as we are getting that capability in-house so that we can get better control on that process quality. With those, I think those are some of the biggest hurdles that we still have got in front of us. There's a lot of little challenges that we fight every day, but the team has been doing a great job keeping those little challenges down and trying to get focus on some of the bigger ones. They're not even at the bigger challenges yet.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

They're on the smaller ones. Now let's contrast that. This may somewhat answer the question of why does it take so long. Research Frontiers overcame these same challenges 15 years ago. We brought SPD Smart Glass into mass production with four automakers and multiple models. We expanded business with Ferrari and other brands whose customers love the option. Even after two supplier bankruptcies that we endured, which is a testament to the strength of our business model, planning, technology, and partners. Our mission has never changed. We pair the best-performing smart glass technology with a low-risk, asset-light business model. This approach keeps expenses predictable, preserves our upside, and supports global diversification. These achievements are all beginning to be publicly recognized. At the Detroit Automotive Glass Conference in less than two weeks, I'll present a comparison of all the major glass technologies and their relative strengths and weaknesses.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

I'll explain why SPD alone is already proven across tens of thousands of cars, yachts, aircraft, trains, and architectural projects, real projects used by real people every day. We continue to compete against PDLC in privacy and in projection uses, where SPD outperforms in clarity, shading, and control. We also outperform electrochromics in nearly every large area application: sunroofs, panoramic roofs, architectural windows, yachts, cruise ships, and museums, delivering faster response, better shading, and greater durability. You will note the recent comments by Gentex about the challenges that they are still facing with electrochromics and their arduous tasks for the years ahead. SPD has always been the high-performance alternative, not the low-cost one. History shows that high-performance products are the most profitable and the most enduring. We have already solved the challenges of performance, durability, mass production, and supply chain.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

We and our licensees keep improving every day with continuous innovations such as black SPD. As mentioned on prior calls, our recent focus was on cost and color. As the black SPD film is expected to be out of development and in production and used shortly, cost is the next frontier. On prior calls, I mentioned new car models in Asia, Europe, and in the United States. These are still moving forward. Since our last call, we have been asked to bid on new multiple major car models. As part of that high-volume quote process, we were given very aggressive price targets, which were based on prices for other competitive technologies. I am pleased to report that we are able to meet it. Maybe cost is not really such a big frontier ahead of us. Our next investor call is not until March.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

I encourage people to keep these things in mind. Perhaps reread the transcripts from this and prior conference calls. Of course, we expect fairly significant developments to announce between now and then. I want to share my thoughts with you now as a fellow shareholder. Things have taken too long. They take longer than they take, but we do it right. One thing I'm especially proud of is how we de-risked the smart glass industry for investors, licensees, and customers alike. If you agree that the pipeline, especially for architectural and automotive, is as large as we are predicting, then the only real risk here is whether it's going to take a little bit longer than whatever your personal time horizons are. On the other hand, if you believe in smart glass, we are the most focused way to participate in that market.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

On top of that, we are diversified across major industries for smart glass and not just focused on one. In September, JPMorgan Chase calculated that 75% of all gains in the market since ChatGPT got started are coming from AI-related stocks. We are not an AI company, but this certainly shows that certain sectors can go from nonexistence or obscurity to highly relevant.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

I'm not giving portfolio allocation advice, but if you have small-cap and microcap companies allocated for your portfolio, we are one of the least risky business companies because of the combination of a high-performing and mature technology that has proven itself to be the best-performing and most reliable, combined with a very modest, asset-light business model that creates a meaningful participation in the upside for Research Frontiers and our shareholders through a 10-15% royalty based on revenues, not profits, from sales of licensed products. We maintain low operating costs and license our technology to global partners who build factories, hire employees, and expand distribution, all multiplying our reach without heavy capital outlays by us. Through their success, we all benefited. Even though these people are not on our payroll, they essentially all still work for us.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

We're in a tough industry, but as history shows, we're tougher. That persistence is now being rewarded as new products reach market. And recognition grows. While others in this industry are still struggling to even bring basic dimming functions to the market, and several other notable ones have shut their doors completely, SPD Smart Glass is already in tens of thousands of vehicles from Mercedes, Ferrari, Cadillac, and McLaren, HondaJet, to Boeing, and to Airbus, and they're expanding. Architects, automakers, and airlines are reaching out to us because they realize that SPD uniquely combines reliability, clarity, speed, and durability. With the retrofit, its ease and speed of installation, lower costs, and high performance and energy efficiency, that's a combination of benefits that no one else can offer. As a leader in the smart glass industry, conferences are reaching out to us to speak and educate.

Joe Harary
Joe Harary
President and CEO at Research Frontiers

With Ferrari's program fully transitioned, the retrofit launch underway, and multiple new car model introductions ahead, Research Frontiers is positioned for meaningful growth. The outlook for the smart glass industry remains extremely promising, at least when it comes to Research Frontiers and our licensees. We stand at the forefront, leading this industry with growth driven by our superior technology, increasing demand, and regulatory support. Continuous innovation, innovative breakthroughs, and excellent global industry recognition. We look forward to sharing upcoming developments with you, our loyal shareholders. We created the smart glass industry. We've helped shape it, and we will continue to make the world better, more energy efficient, safer, and more enjoyable. Thank you all very much.

Executives
    • Joe Harary
      Joe Harary
      President and CEO
Analysts
    • Analyst 1
    • Analyst 2
    • James Le
      Director, Data Management, Financial Crimes at RBC
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