Aeluma, Inc.

Aeluma, Inc. develops high-performance semiconductors for sensing, communication, and computing applications, utilizing a proprietary technique to manufacture devices using compound semiconductor materials on large-diameter substrates commonly used for mass-market microelectronics. This technology enables cost-effective manufacturing of high-performance photodetectors and photodetector arrays for imaging applications in mobile devices, among other uses. The company's technology is broadly applicable across market verticals including mobile, automotive, AI, defense & aerospace, communication, augmented reality (AR), virtual reality (VR), high-performance computing (HPC), and quantum computing. Aeluma operates a 9,000 sq. ft. ¹ facility in Goleta, California, which includes a state-of-the-art research and development (R&D)/manufacturing cleanroom and access to rapid prototyping capabilities. The company also partners with production-scale fabrication foundries and packaging companies. Aeluma maintains extensive patent protection and trade secrets related to its materials, manufacturing technology, and applications. The CMOS image sensors market is projected to be $28.6 billion by 2029 ², the automotive lidar market is projected to be between $5 billion to $80 billion in 2030 ³, the AI market is projected to be $826 billion in 2030 ⁴, the silicon photonics market is projected to be $8 billion in 2030 ⁵, and the total addressable market for the quantum computing industry is projected to grow to $20 billion by 2030 ⁶. The mobile and consumer market represented $296 billion in semiconductor revenue in 2023 ⁷, and the global semiconductor market is projected to exceed $1 trillion in 2030 ⁸. Aeluma estimates its serviceable addressable market could reach $4.9 billion in 2030 ⁹, growing at a 47% compound annual rate from $1.0 billion in 2026 ¹⁰.

Aeluma's competitive positioning is based on its ability to outperform silicon CMOS image sensors while achieving a lower manufacturing cost than traditional InGaAs sensors. The company aims to leverage larger diameter substrates, up to 12-inch, compared to competing InGaAs photodetectors manufactured on 2- to 4-inch indium phosphide (InP) substrates. This allows for manufacturing products potentially at a ten times lower cost for mass market applications and scaling production at a faster rate than incumbent technologies. Existing and potential competitors, such as Sony, Samsung, Omnivision, onsemi, STMicroelectronics, Panasonic, Canon, SK Hynix for silicon CMOS image sensors, and Hamamatsu, Sumitomo, Teledyne/FLIR, Excelitas for InGaAs sensors, may have advantages in name recognition, operating histories, product portfolios, customer bases, financial resources, and manufacturing operations.

The core business model involves generating revenue through commercial product sales and government contracts. Commercial revenue is derived from R&D-related services and small-volume orders, while government contracts are principally R&D contracts with U.S. government agencies or prime contractors, which may include cost-reimbursement or fixed-price terms. The company's strategy is to pursue partnerships with system integrators, including mobile and consumer electronics manufacturers, Tier-1 suppliers, module manufacturers, component suppliers, or semiconductor manufacturing companies, and is pursuing direct sales relationships and strategic partnerships with approximately 20 prospective customers.

Aeluma's technology is based on heterogeneous integration of compound semiconductor materials on large-diameter substrates like silicon, enabling device fabrication and manufacturing in large-scale environments for mass markets. This technology is applied to high-performance photodetectors and photodetector arrays for imaging applications in mobile devices, as well as other applications. The technology may also be used to manufacture other electronic and optoelectronic devices including lasers, transistors, and solar cells.

For the fiscal year ended June 30, 2025, total revenue increased to $4.665 million ¹¹ from $919 thousand ¹² in the prior fiscal year, representing a 407.9% ¹³ increase. Of the 2025 revenue, $4.4 million ¹⁴ was derived from government contracts and $266 thousand ¹⁵ from commercial product and service contracts. In 2024, government contracts accounted for $854 thousand ¹⁶ and commercial contracts for $65 thousand ¹⁷. The company reported a net loss of $3.022 million ¹⁸ for the fiscal year ended June 30, 2025, an improvement from a net loss of $4.562 million ¹⁹ in the prior fiscal year, representing a -33.8% ²⁰ change. Basic and diluted EPS for 2025 was $(0.23) ²¹, compared to $(0.37) ²² in 2024. Cash, cash equivalents, and a certificate of deposit totaled $15.7 million ²³ as of June 30, 2025, significantly up from $1.3 million ²⁴ as of June 30, 2024. Total current assets increased to $17.335 million ²⁵ from $1.393 million ²⁶ in the prior year. Total liabilities were $1.508 million ²⁷ as of June 30, 2025, compared to $1.568 million ²⁸ as of June 30, 2024.

Year-over-year, revenue increased by $3.7 million ²⁹, or 407.9% ³⁰. Operating expenses increased by $1.3 million ³¹, or 24.2% ³², to $6.807 million ³³ in 2025 from $5.482 million ³⁴ in 2024. This increase was primarily due to higher material purchases to support product and service delivery, as well as increased compensation and related costs, including salaries, stock-based compensation, and employee benefits. Net cash used in operating activities decreased to $1.148 million ³⁵ in 2025 from $3.455 million ³⁶ in 2024, a -66.8% ³⁷ change. Net cash provided by financing activities was $15.757 million ³⁸ in 2025, a substantial increase from net cash used of $4 thousand ³⁹ in 2024.

Significant operational developments during the fiscal year ended June 30, 2025, include the receipt of several government contracts. In August 2024, a contract was received from NASA to develop quantum dot photonic integrated circuits (PICs) on silicon for next-generation space and aerospace applications. In September 2024, a $11.7 million ⁴⁰ contract was awarded by DARPA to develop heterogeneous integration technology for nano-scale semiconductors, with $6.0 million ⁴¹ expected to be invoiced over the first 18 months and the remaining $5.7 million ⁴² over the subsequent 18 months, contingent on milestone achievement. April 2025 saw a contract with the U.S. Department of Energy to develop commercially viable, low-cost shortwave infrared (SWIR) photodetectors. In June 2025, two contracts were received from the U.S. Navy: one for up to $1.3 million ⁴³ in funding to accelerate high-speed photodetector development for government and commercial applications, and another to support low size, weight, and power imaging sensors for next-generation quantum computing and sensing systems. The company also completed a public offering on March 28, 2025, raising total gross proceeds of $13.8 million ⁴⁴ and net proceeds of $12.6 million ⁴⁵, which are intended for business development, scaling manufacturing operations, and general corporate purposes. Additionally, convertible promissory notes in the aggregate principal amount of $3.1 million ⁴⁶ were issued between August 5, 2024, and August 27, 2024, to 10 accredited investors, which subsequently converted into 898,573 ⁴⁷ shares of Common Stock at a Ceiling Price of $3.50 per share ⁴⁸ on March 25, 2025.

Aeluma intends to continue developing its technology, including novel materials and devices based on its core intellectual property, with a primary focus on manufacturing high-performance semiconductor technologies that scale for mass markets. The company will continue to mature its manufacturing processes to further commercialization traction. It plans to expand business development and marketing efforts, further engage with manufacturing partners, and continue efforts toward volume production and commercialization. Aeluma expects to rely on external capabilities to scale production capacity in support of high-volume markets.

The company's growth areas are broadly applicable across mobile, automotive, AI, defense & aerospace, communication, AR/VR, high-performance computing, and quantum computing. Specific growth vectors include the development of quantum dot photonic integrated circuits (PICs) on silicon for next-generation space and aerospace applications under a NASA contract, enabling free-space laser communication, autonomous navigation, and precision sensing. Another growth area is the development of heterogeneous integration technology for nano-scale semiconductors compatible with leading-edge and future advanced-node semiconductors, targeting AI, mobile devices, and 5G/6G wireless networking, supported by an $11.7 million ⁴⁹ DARPA contract. The company is also developing commercially viable, low-cost shortwave infrared (SWIR) photodetectors under a U.S. Department of Energy contract, which will accelerate commercialization of Aeluma’s wafer-scale platform for high-sensitivity, energy-efficient photodetector sensors across critical growth sectors. Furthermore, contracts with the U.S. Navy aim to accelerate development of high-speed photodetectors for government and commercial applications, and support low size, weight, and power imaging sensors for next-generation quantum computing and sensing systems.

Operationally, Aeluma expects its cost of revenue to vary substantially depending on the nature of products and/or services delivered in each customer engagement. Research and development (R&D) expenses will primarily consist of compensation and related costs for personnel, design, fabrication, packaging, and testing of devices, and facility lease and utility expenses. General and administrative expenses will include compensation and related costs for personnel, third-party consulting, legal, insurance, audit, and accounting services, and office lease and utility expenses. The company plans to hire additional personnel on an as-needed basis, with the majority of current employees working in engineering.

Regarding capital allocation, Aeluma intends to use the net proceeds of $12.6 million ⁵⁰ from its recent public offering for business development, scaling manufacturing operations, and general corporate purposes. The company will continue to assess its capital requirements and may pursue additional financing opportunities to support long-term growth initiatives or respond to changes in market conditions. Unrecognized stock-based compensation expense was $4.1 million ⁵¹ as of June 30, 2025, with an average expected recognition period of 1.5 years ⁵². The company has never declared or paid cash dividends on its common stock and does not anticipate doing so in the foreseeable future, intending to retain future earnings to fund ongoing operations and future capital requirements.

The company has identified structural headwinds and execution risks, including the lengthy and expensive qualification process customers may require for products without assurance of sales. The timelines for adoption of its technologies might be longer than anticipated, as its components are incorporated into customers' end-products and systems, which involve development effort and market adoption lead-times. Changes to regulatory agencies, such as those potentially instituted by the President's "Department of Government Efficiency" (DOGE), could impact regulatory reviews and approvals, causing delays to operations or special projects. Compliance with federal securities laws and Nasdaq requirements is increasingly complex and expensive. The company generates a substantial portion of its revenue from U.S. federal government agencies, which are subject to risks such as intense competition, changing certification requirements, budgetary cycles, termination for convenience, investigations and audits, and less control when acting as a subcontractor.

Aeluma faces several material risks, including its early development stage with no volume production for any product offerings, making it difficult to evaluate its business and prospects, and potentially leading to continuing net losses and negative cash flows. The company's future growth depends on its ability to raise additional capital, as existing cash and cash equivalents, and cash flow from operations may not be sufficient for long-term needs, and equity financing could result in significant stockholder dilution. There is no guarantee that the company will sell any shares pursuant to its Shelf S3 registration statement, which allows for the sale of up to $100,000,000 ⁵³ in securities. The company's growth strategy is dependent on expanding its partner ecosystem, acquiring new customers, scaling its business model and technology for commercial deployment, ensuring a consistent supply chain, expanding within verticals, innovating product offerings, and selectively pursuing strategic acquisitions, with no assurance of success or realization of anticipated benefits. The timelines for technology adoption may be longer than anticipated, delaying revenue growth. Changes to regulatory agencies, such as those potentially instituted by the President's "Department of Government Efficiency" (DOGE), could lead to significant reductions in staff and/or federal funding, causing backlogs or interruptions to regulatory reviews and approvals. The company generates a substantial portion of its revenue from U.S. federal government agencies, which are subject to risks including highly competitive and time-consuming contracting processes, changing certification requirements, impacts from public sector budgetary cycles, termination for convenience, investigations and audits, and reduced control as a subcontractor. The loss of key management and employees or the inability to attract and retain qualified personnel, particularly in areas with high housing costs like Santa Barbara, could harm the business. The company has identified a material weakness in its internal control over financial reporting as of June 30, 2025, due to an insufficient number of personnel with appropriate technical accounting and SEC reporting expertise, which could result in material misstatements in future financial statements. Aeluma depends on a limited number of customers, and the loss of one or more could materially adversely affect its business. Some business may be dependent on a royalty-based model, which is inherently risky due to factors outside the company's control. Uncertainties in customer orders could lead to excess inventory and write-downs. The semiconductor industry is highly cyclical, characterized by rapid innovation, short product life cycles, and intense competition, which can lead to price erosion and make it difficult to satisfy demand during upturns. Shortages or increased prices of raw materials, potentially impacted by geopolitical conflicts affecting rare earths or minerals like indium, gallium, and arsenic, could materially adversely affect results. Changes in import tariffs due to new administrations could increase costs and disrupt supply chains. The company's current operations are concentrated in one location near Santa Barbara, California, making it susceptible to natural disasters or other disruptions. The company's technologies may infringe on the intellectual property rights of others, leading to costly disputes or disruptions.

Management's message to shareholders emphasizes the company's focus on developing novel optoelectronic and electronic devices for sensing, communication, and computing applications, leveraging its pioneering technique to produce semiconductor materials and chips using high-performance compound semiconductors on large-diameter substrates for mass-market microelectronics. The overall tone suggests a commitment to scaling technology for mass markets and expanding commercialization traction. Management has assessed its financial position and operating plan, determining that the previously reported substantial doubt about its ability to continue as a going concern has been alleviated for at least the next twelve months, primarily due to the successful completion of a public offering that raised gross proceeds of $13.8 million ⁵⁴ and net proceeds of $12.6 million ⁵⁵. The strategic priorities for the period ahead include continuing to develop core intellectual property and novel materials and devices, expanding business development and marketing efforts, and further engaging with manufacturing partners to achieve volume production and commercialization. The company intends to use the net proceeds from the offering to support operational growth, invest in product development, and fund working capital and general corporate purposes. Management also highlights the receipt of several government contracts, including an $11.7 million ⁵⁶ contract with DARPA, as key drivers for advancing its technology in various applications.