CID Holdco (NASDAQ:DAIC), which operates as Dot Ai, said its first quarter of fiscal 2026 reflected a planned period of low revenue as the company prepares for expected subscription and hardware deployment activity in the second half of the year.
Co-Founder and CEO Ed Nabrotzky told investors that 2025 was a “foundational year” for the company, marking its transition to commercial operations and public company reporting. He said the company’s roughly $5.8 million in hardware revenue during the last two quarters of 2025 served as a leading indicator for deployments expected in 2026, but reiterated that meaningful revenue from those deployments is not expected until the final two quarters of the year.
Dot Ai Reaffirms Back-End Weighted 2026 Revenue Outlook
Dot Ai reaffirmed its full-year 2026 revenue guidance of $6 million to $7.5 million. Nabrotzky said the expected bookings and revenue remain “back-end weighted,” occurring mostly in the third and fourth quarters of 2026.
The company is shifting its business model toward recurring subscription revenue tied to its asset intelligence platform. Nabrotzky said hardware deployments remain a forward indicator of subscription revenue growth because the company’s model depends on enrolled devices feeding data into its cloud-based software.
Dot Ai expects to book three- to five-year subscription contracts, with Nabrotzky pointing to what he described as a strong customer retention profile because customers rely on installed hardware for data collection and software for operational execution.
The company’s priorities for 2026 include converting pipeline into revenue, expanding its customer base, deepening existing customer relationships, scaling its partner ecosystem and increasing recurring SaaS revenue as a share of the total business mix.
First-Quarter Revenue Declines as Spending Rises
CFO Charlie Maddox said revenue in the first quarter of 2026 was “de minimis,” compared with $0.4 million in the same quarter a year earlier. The decline reflected the timing of the company’s 2026 revenue plan and its strategic transition away from one-time hardware-led sales toward longer-term recurring subscription revenue.
Gross margin for the quarter was 78.2%, which Maddox said reflected the inherent strength of the company’s model.
Operating expenses totaled $4.1 million, up from $2.1 million in the prior-year period. Maddox said the increase was primarily driven by costs tied to operating as a public company, expansion of the commercial team and partner ecosystem, and continued investment in the company’s Gen 3 Asset Intelligence platform. Those costs were partially offset by cost controls implemented during the quarter.
- First-quarter 2026 revenue was de minimis, versus $0.4 million a year earlier.
- Gross margin was 78.2%.
- Operating expenses were $4.1 million, compared with $2.1 million in the prior-year quarter.
- Net loss was $4.5 million, or $0.15 per basic and diluted share, versus a net loss of $1.3 million, or $0.11 per basic and diluted share, a year earlier.
- Adjusted EBITDA was negative $3.9 million, compared with negative $1.3 million in the year-ago quarter.
Company Points to Asset Intelligence Platform and Partner Strategy
Nabrotzky described Dot Ai’s business as built on two pillars: an Internet of Things implementation for in-process data collection and a cloud-based software suite designed to enable AI workflows. He said the company’s solutions give physical assets a persistent virtual identity, process context and real-time 3-D location.
The company completed its Generation 3 SaaS platform in 2025, and Nabrotzky said Dot Ai made several updates during the first quarter as it exercised the platform in pilots and prepared for larger-scale rollouts. He described the software as the backbone of the recurring revenue model, supporting real-time asset visibility, predictive analytics and integration with existing customer infrastructure.
Nabrotzky also highlighted the company’s partner and market education efforts. Shortly after the end of the quarter, Dot Ai co-hosted an industry webinar with Wiliot and Würth Industry North America focused on Ambient IoT and AI in industrial operations. He said such activities help educate the market, build the company’s pipeline and reinforce Dot Ai’s position with partners.
During the quarter, Dot Ai engaged MZ Group to lead an investor relations and financial communications program. Nabrotzky said the firm will help communicate the company’s story to institutional investors, brokers, analysts and private investors, while coordinating roadshows and investment conference participation. Dot Ai also plans to participate in the Noble and Planet MicroCap events in June.
Capital Raise and Cost Controls Remain in Focus
Nabrotzky said Dot Ai is in the midst of a capital raise needed to bridge the gap to the future revenue outlined by management. He said the company’s annual shareholders meeting this week would include votes on measures to enable that raise.
The company has also implemented labor reductions and cost controls to align spending with key subscriber milestones expected this year.
Maddox said Dot Ai’s capital allocation priorities remain focused on revenue-generating activities, including the commercial team, co-marketing, partner onboarding and software platform development. He said the company will continue evaluating capital sources while aligning access to capital with revenue milestones and long-term shareholder value.
Nabrotzky said recent weakness in the semiconductor market is not expected to significantly affect Dot Ai in the short term because the company has enough component and finished assembly inventory to meet its goals for the year. He also said U.S. tariff policy is driving more business toward the company because of its Made in America positioning.
No analysts or investors asked questions during the call. Nabrotzky closed by saying the company expects to report its second-quarter results as scheduled.
About CID Holdco (NASDAQ:DAIC)
CID Holdco, Inc is a manufacturing company in the Computer Software industry.
