Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Management attributes the current net loss to a transitional period focused on stabilizing manufacturing operations and building human infrastructure rather than a lack of market demand.
Revenue levels in the first half of 2026 remained below the threshold required to fully leverage fixed operational expenses and reach historical profitability potential. Gross margin improvement from Q1 to Q2 was driven by higher revenue volume and a gradual adjustment of average selling prices to reflect a higher cost environment. The company is facing significant supply chain headwinds, particularly for fiberglass-based materials, due to intense competition for supply from the rapidly growing AI infrastructure industry.
Operational capacity is being addressed through the integration of 15 foreign employees, with plans to add approximately 15 more to improve production efficiency. Strategic diversification efforts continue to focus on medical and high-end industrial markets to balance the existing defense-heavy portfolio. Official qualification for the first new PCB plating line is expected to begin in Q3 2026, with full commercial production anticipated several months later.
A second plating line is scheduled for delivery and installation by the end of 2026, supported by contractual penalties for potential supplier delays. Profitability recovery is dependent on the gradual replacement of older backlog orders with new contracts priced at current, more favorable exchange rates. Management expects the implementation of a new ERP system to provide the necessary foundation for scaling operations and improving management oversight.
Future financial performance relies on the successful conversion of a record-high backlog into shipments while navigating raw material allocation quotas. The appreciation of the Israeli shekel against the U.S. dollar significantly impacted gross profitability and contributed to financial expenses. Raw material costs are subject to extreme volatility, with some suppliers implementing allocation quotas that make securing necessary materials increasingly difficult.
Approximately one-third of the current backlog consists of long-term purchase orders fixed at historical exchange rates, which continues to weigh on overall profitability. Nvidia-level potential. 30M+ investors trust Moby to find it first. Management expects improvement to be gradual, contingent on increased production volume, better capacity utilization, and the ramp-up of new lines.
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