Q1 to Q2 improved direct margins because of the base coat substrate improvement. Direct margin improvements continue to be the objective longer term.

Projecting positive direct margin breakeven by Q4. (target)

Long term goal is 50% model for direct margin which would yield a 40% gross margin.

Q1 direct margin was -115%

Q2 direct margin was -86% Improving going forward. Mind you, all revs are still from legacy products primarily.

As revs increase the cash burn lowers. Q4 should reflect that.