Desert Control (DSRT) Q2 2025 earnings summary

Executive summary

• Commercial activities expanded in the US and Middle East, including pilots in California, Dubai, and the first commercial project in Saudi Arabia, with operational focus on permanent crops, golf, and landscaping.

• Technology advancements improved yield and water efficiency, with next-generation production systems set for launch in late 2025.

• Organizational realignment and process improvements addressed operational challenges and support commercial scale-up.

• Strategic focus on scaling deployments in high-value agriculture and turf, leveraging partnerships and recurring revenue models.

• The board is actively evaluating funding alternatives, including equity financing, grants, and partnerships, to support long-term growth.

Financial highlights

• Q2 2025 revenue was NOK 0.13 million, down from NOK 0.51 million in Q2 2024, due to PACE/PAYS contract structure and revenue recognition timing.

• EBITDA for Q2 2025 was negative NOK 15.88 million, with a net loss of NOK 19.28 million.

• Cash balance at quarter-end was NOK 24.84 million, with no interest-bearing debt and equity of NOK 43.72 million (89.4% of total assets).

• Gross profit for Q2 2025 was NOK 55 thousand, with a gross margin of 43%.

• Operating cash flow and cash burn rate indicate runway into Q4 2025, with no significant new capital raised.

Outlook and guidance

• Focus remains on core U.S. and Middle East markets, with California and Arizona as primary U.S. targets.

• Revenue expected to increase in H2 2025 as contract milestones are met and new projects commence.

• Initial 2026 guidance targets over $3 million in revenue, with 50-60% from the U.S. and the remainder from Middle East licensing and hardware sales.

• Targeting 10x revenue growth from 2025 to 2027, driven by scalable commercialization and new production units.

• Financial runway extends into Q4 2025 due to disciplined cost management; additional capital required for long-term growth.