IQSTEL Inc. (NASDAQ: IQST) released a shareholder letter on January 14, 2026 that outlines a comprehensive AI strategy and a commercial roadmap. The letter highlights the company’s proprietary Reality Border platform and its integration with cybersecurity partner Cycurion, positioning IQSTEL to capture higher‑margin AI services within its existing telecom infrastructure.
The letter confirms that three AI products—AIRWEB, IQ2Call, and an AI‑powered contact center service—are already in the market. Early traction is evident, with slightly under 100 active AIRWEB users and multiple IQ2Call trials underway, indicating a growing sales pipeline and early commercial adoption.
IQSTEL sets a fiscal‑year 2027 sales objective of at least $1 million for high‑margin AI services and reiterates a 2026 EBITDA goal of $15 million. The company’s strategic shift from commodity wholesale voice and SMS services to AI‑enabled platforms is intended to transform its margin profile and accelerate the EBITDA target.
Prior financial performance underscores the urgency of the pivot. In 2024, IQSTEL reported net revenue of $277 million, with Q4 revenue of $96 million—a 77% year‑over‑year increase. The first nine months of 2024 generated $184 million, an 89% YoY jump. In Q3 2025, revenue rose 90% to $102.8 million. Despite revenue growth, the company’s gross profit margins have remained weak, ranging from 2.78% to 3.02%, and it has burned through cash, reporting negative free cash flow of $3.13 million in the last twelve months. These figures illustrate the need for a higher‑margin business model.
Investors reacted positively to the shareholder letter, reflecting confidence in the AI strategy. Analysts note a mixed view: while the AI pivot offers upside potential, concerns about cash burn and margin compression persist. The market’s response signals that the AI initiative is viewed as a significant step toward improving profitability, though it also highlights the need for disciplined capital management.
The AI platform is expected to drive higher‑margin revenue and operational leverage, potentially transforming IQSTEL’s margin profile. However, the company must continue to invest in product development and manage cash burn to sustain the transition. The strategic shift positions IQSTEL to capture new growth opportunities while addressing the challenges of scaling a high‑margin AI business.
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