Executive Summary

Q2 2025 marked ongoing commercialization of AI Nose with a first three-year subscription-based order of $2.1M in semiconductor manufacturing and pilots spanning robotics and smart factories; however, revenue was modest at $4,663 and net loss widened year over year, reflecting early-stage scale-up and continued investment .
Gross profit turned positive, and management highlighted improved first-half gross margin and capital discipline alongside no debt maturities through 2027 and $719K net proceeds from measured ATM usage .
Operational roadmap targets approximately 1,400 pilot AI Nose deployments in 2H25 and scale-up to ~5,000 units in Phase 1 and up to ~15,000 in Phase 2; no formal financial guidance was issued .
Near-term stock reaction catalysts include the multi-year $2.1M order, pilot deployment milestones, regained Nasdaq compliance via 1-for-5 reverse split, and ecosystem partnerships with leading industrial AI firms .

What Went Well and What Went Wrong

What Went Well

Secured the first three-year subscription order worth $2.1M with ASE Technology, validating industrial demand for AI-powered olfaction in semiconductor manufacturing .
Commercial traction expanded through pilots at seven Japanese industrial sites with ugo robots and distribution partnerships (Solomon, Kenmec), enhancing AI Nose’s ecosystem and routes to market; CEO emphasized expanding SmellTech-as-a-Service for recurring revenue .
“We’re thrilled that our proprietary AI-powered scent digitization platform, AI Nose, has entered the commercial execution phase… we’ve set the stage for the second half with accelerating momentum and expanding commercial traction” — Eddy Tsai, CEO .

What Went Wrong

Revenue fell sharply quarter over quarter (Q1 to Q2) as senior care revenues did not repeat, underscoring lumpy early-stage commercialization; net loss widened versus Q2 2024 due to higher operating expenses .
Cash declined to $1.22M by June 30, 2025 from $2.63M at March 31, 2025 and $8.01M a year earlier, highlighting near-term liquidity constraints absent external financing .
Formal financial guidance was not provided; investors must anchor on operational milestones (units, pilots) rather than revenue/expense targets, increasing execution risk around timing and scale .

Financial Results

Quarter-over-Quarter and Year-over-Year Comparison

Metric	Q2 2024	Q1 2025	Q2 2025
Revenue ($USD)	$0	$106,207	$4,663
Gross Profit ($USD)	$(25,373)	$87,974	$3,726
Gross Margin (%)	n/a	82.8%	79.9%
R&D ($USD)	$1,978,756	$1,724,084	$1,911,800
SG&A ($USD)	$1,044,880	$1,526,761	$1,837,613
Total Operating Expenses ($USD)	$3,023,636	$3,250,845	$3,749,413
Operating Income (EBIT) ($USD)	$(3,049,009)	$(3,162,871)	$(3,745,687)
Net Loss ($USD)	$(3,195,022)	$(3,286,022)	$(4,084,990)
Diluted EPS ($USD)	$(2.45)*	$(0.21)	$(0.99)*

Notes: Gross margin is derived from reported revenue and gross profit. Asterisk (*) denotes values retrieved from S&P Global.

Cash & Liquidity

Metric	Q2 2024	Q1 2025	Q2 2025
Cash and Equivalents ($USD)	$8,014,098	$2,628,286	$1,223,184
Convertible Notes Payable - Current ($USD)	$3,000,000	$1,000,000	$0
Convertible Notes Payable - Noncurrent ($USD)	$9,000,000	$11,000,000	$11,000,000

Consensus vs. Actual (Q2 2025)

Metric	Consensus (S&P Global)	Actual	Beat/Miss
Revenue ($USD)	n/a*	$4,663	n/a*
EPS ($USD)	n/a*	$(0.99)*	n/a*

Asterisk (*) denotes values retrieved from S&P Global; S&P Global consensus for AIMD Q2 2025 was unavailable.

KPIs and Operational Metrics

KPI	Q2 2025
AI Nose accuracy – eldercare hygiene detection	85%
AI Nose accuracy – semiconductor facilities	80%
AI Nose accuracy – food/beverage classification	90%
3-year subscription order value (ASEH)	$2.1M
90-day roadmap pilot deployments (Evaluation Phase)	~1,400 units targeted
Phase 1 expansion target	~5,000 units
Phase 2 scale-up target	Up to ~15,000 units

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
AI Nose pilot deployments (Evaluation Phase)	2H 2025	n/a	~1,400 units targeted	New operational target
Phase 1 expansion	Post-Evaluation	n/a	~5,000 units	New operational target
Phase 2 scale-up	Post-Phase 1	n/a	Up to ~15,000 units	New operational target
Financial guidance (revenue/margins/OpEx/tax)	2H 2025	none	none	Maintained: no financial guidance

Earnings Call Themes & Trends

No Q2 2025 earnings call transcript was available in our document set. The table reflects evolving themes from Q4 2024 (Q-2) and Q1 2025 (Q-1) press releases versus Q2 2025.

Topic	Previous Mentions (Q-2 and Q-1)	Current Period (Q2 2025)	Trend
AI Nose commercialization	Q-2: Flora clinicals; VOC platform; industrial accuracy ~80%	First $2.1M subscription order; pilots with robotics; 90-day roadmap	Accelerating commercialization
Partnerships (semiconductor, robotics, industrial AI)	Q-2: Taiwan Tanabe (biotech); ASE collaboration; ugo integration	ASEH subscription order; ugo pilots; Solomon distribution; Kenmec integration	Expanding ecosystem
Regulatory/clinical (VELDONA®)	Q-2: IRB approvals; patent wins	Two human trials initiated; promising FCGS interim results	Advancing pipeline
Capital structure/liquidity	Q-2: Cash improved YoY; transition spend	Reverse split (1-for-5); regained Nasdaq compliance; $719K ATM; no maturities through 2027	Stabilizing/positioning
Product performance KPIs	Q-1: Early traction; seniors care revenue	Accuracy KPIs across verticals (85% eldercare; 80% semi; 90% F&B)	Improving validation

Management Commentary

“The first half of 2025 marked a strategic inflection point as we successfully transitioned from R&D to revenue-generating deployment in Japan… we’ve set the stage for the second half with accelerating momentum and expanding commercial traction” — Chun-Hsien (Eddy) Tsai, CEO .
“We’ve secured our first three-year subscription order valued at $2.1 million for first deployment of AI Nose in semiconductor manufacturing… launching pilot deployments… at seven industrial sites across Japan” — CEO .
“We’re executing a focused 90-day action plan… targeting to complete approximately 1,400 pilot deployments… initiate Phase 1 expansion to around 5,000 units… foundation for Phase 2 scale-up to as many as 15,000 units” — CEO .
“We… improved gross margin, turning to gross profitability in both Q2 and the first half… no debt maturities through 2027… measured use of our at-the-market facility generating $719K” — Christopher Lee, CFO .

Q&A Highlights

No Q2 2025 earnings call transcript was available in our document catalog; therefore, Q&A highlights and any guidance clarifications from a call could not be assessed. We searched for AIMD earnings-call-transcript and found none [ListDocuments: earnings-call-transcript=0].

Estimates Context

S&P Global consensus estimates for AIMD Q2 2025 were unavailable; accordingly, beat/miss analysis versus Street is not possible. Values retrieved from S&P Global.*
Where presented, EPS and consensus fields are marked with an asterisk to indicate S&P Global data or unavailability of consensus.

Key Takeaways for Investors

The $2.1M, three-year subscription order with ASEH is a credible industrial validation and should underpin recurring SaaS potential in SmellTech-as-a-Service; watch for pilot-to-scale conversion across the 1,400/5,000/15,000 unit roadmap .
Commercial pilots with ugo and distribution partners (Solomon, Kenmec) broaden the deployment footprint and sensor-fusion opportunities, potentially enhancing data moat and model performance .
Revenue volatility and widened net loss underscore early commercialization dynamics; investors should track unit deployments, paid subscriptions, and margin progression as leading indicators rather than quarterly revenue prints .
Liquidity tightened to $1.22M cash at Q2 end, but management cites no debt maturities through 2027 and ATM proceeds; financing plans remain a key monitoring item .
KPI accuracy improvements across sectors (85% eldercare, 80% semi, 90% F&B) support product readiness; real-world validation at scale will be pivotal for ARR growth potential .
No formal financial guidance; execution on operational milestones is the de facto yardstick for 2H25—expect announcements tied to Automation Taipei showcase and broader industrial pilot launches .
Biotech optionality continues via VELDONA® human trials and veterinary FCGS study, offering medium-term diversification and potential licensing catalysts .

Footnote: *Values retrieved from S&P Global.

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