Palomino Laboratories Inc.

What they do

The company is developing optical transceivers that transmit data using light rather than copper wires, built around gallium nitride (GaN) microLEDs that it says can be manufactured with existing semiconductor processes. It holds a licensing agreement with the University of California, Santa Barbara for microLED technology used in developing its optical transceiver device. Palomino operates in a single reportable segment with no revenue reported to date; it became a public reporting company through a September 29, 2025 merger with Unite Acquisition 3 Corp. and is now the surviving public entity under the Palomino name.

Revenue drivers

• MicroLED optical transceivers (no revenue to date) — The company is pre-revenue and describes its intended product as optical transceivers integrating GaN microLEDs into silicon packages or interposers for AI servers, data centers and high-performance computing. No product revenue has been recognized in any reported period.
• Single reportable segment — Management states the company operates in one reportable segment, with all revenues, expenses and assets reflected on a consolidated basis, so no segment-level revenue breakdown is disclosed.
• UCSB microLED licensing — The business model relies on a licensing agreement with the University of California, Santa Barbara giving access to microLED research and intellectual property for its transceiver development; the filings do not disclose any license-related revenue.

Recent performance

Annual net losses widened from $2,168 in 2023 to $16,198 in 2024 and $3.2 million in 2025, with diluted EPS of -$0.004, -$0.011 and -$0.471 respectively. Operating cash flow was negative in each year: -$13,673 (2023), -$4,870 (2024) and -$1.3 million (2025). For the six months ended June 30, 2026, net loss was $2,608,464 versus $595,752 for the six months ended June 30, 2025. At June 30, 2026, total assets were $21.0 million, total liabilities $475,962, shareholder equity $20.6 million and cash and equivalents $19.4 million.

Strategy

Management is commercializing a GaN microLED platform for ultra-high-speed, energy-efficient optical interconnects intended to replace copper-based PCIe and Ethernet links. The company funds operations primarily through SAFE Notes, having raised approximately $1.8 million in aggregate net proceeds from SAFE issuances from inception through June 30, 2026. It adopted an equity incentive plan reserving 15% of post-merger, fully diluted shares for options and other awards to officers, employees, consultants and directors. Subsequent to December 31, 2025, it entered a lease for approximately 2,754 square feet of office and laboratory space at 130 Castilian Drive, Goleta, California, commencing January 1, 2026 and expiring December 31, 2028, with a 36-month renewal option.

Risks

• Pre-revenue with recurring losses — The company has no product revenue and reported a $3.2 million net loss for 2025 and a $2,608,464 net loss for the six months ended June 30, 2026.
• Trade and export restrictions — The 10-K states the company may rely on global supply chains, including goods sourced from China, exposing it to U.S. tariffs and Chinese retaliatory tariffs.
• Dependence on third-party microLED IP — Its transceiver development depends on a licensing agreement with the University of California, Santa Barbara for advanced microLED technology.
• Early-stage technology commercialization — The 10-K describes the investment as speculative and involving a high degree of risk due to the stage of development of its optical communications and photonics technology.

Outlook

Management states that, based on current operating plans, existing cash as of June 30, 2026 will be sufficient to support operations for at least one year from the issuance date of the condensed consolidated financial statements. The company expects to incur additional losses and will need to fund continued development of its microLED optical transceiver platform. It has continued to enter material agreements and complete at least one acquisition or disposition since the last 10-K, as disclosed in 8-K filings through August 2026.