KMX Insights – Quarterly Update – October 2026

Four Commercial Catalysts Ahead for KMX

It was an outstanding quarter for KMX. The team made meaningful advancements across commercial growth, supply chain readiness, IP, and technical enhancements.

Over the last quarter, we have been particularly focused on new and existing projects in the U.S. West and Southwest. We expect that focus to continue, driven by sustained drought, evolving regional water regulations, and growing awareness of new water technologies, like Vacuum Membrane Distillation (VMD), that can help crowd in water technology capital.

Next week, we'll be hosting a Lunch & Learn in New York City on this opportunity. We expect to continue our focus on finding opportunities to maximize water and mineral recovery across the region in the years ahead.

For this Quarterly Update, I'm excited to share insights into our growing end-market opportunities and highlight the four commercial catalysts we see ahead for KMX.

• Oil & Gas Produced Water Desalination
• Critical Minerals
• Food & Beverage
• Data Centers

1) Oil & Gas Produced Water Desalination

The outlook for desalinating oil & gas produced water continues to improve.

The emergence of data centers under development in West Texas, attracted by competitive energy prices, available land, and relatively low population density, is adding another potential source of demand for desalinated produced water.

The recent pause in data center development in Texas is providing regulators the opportunity to assess development considerations related to energy and water impacts on local communities.

In the quarters ahead, we expect greater regulatory clarity to provide a clearer path towards utilizing desalinated oil & gas produced water for beneficial industrial purposes, including data center cooling.

Beyond potential demand from data centers, we anticipate the need to desalinate produced water for volume reduction purposes will increase as disposal options become increasingly constrained.

2) Critical Minerals

The recovery in lithium prices, continued efforts to develop domestic sources of critical minerals, and growing scrutiny around water usage for mineral projects in the American West are all supporting an improving outlook for KMX's critical minerals business.

Related to this opportunity, we are excited to have been named a finalist in the Xylem and ClimateHaven Innovation Challenge and look forward to working with both organizations to identify opportunities to maximize mineral and water recovery.

We also hope to share some exciting news in the coming months regarding advancements with a leading lithium development company, which could provide another important catalyst for our critical minerals business.

3) Food & Beverage

In our last quarterly update, we mentioned our hope of entering an exciting new end-market. We're thrilled to now be working on a paid pilot to maximize water recovery for a globally recognized beverage company.

The pilot is still underway, but we're pleased to report positive early results in-line with our expectations.

Building on this work for a global leader in the beverage and water stewardship industries, we look forward to sharing our growth plans for the broader food & beverage market, including helping companies reduce operating costs, improve water recovery, and strengthen local water security.

4) Data Centers

In addition to the opportunity to create a new source of distilled-quality water for data centers by desalinating oil & gas produced water, we are seeing growing interest in KMX's technology to increase water recovery from data center cooling operations.

BlueTech Research recently highlighted KMX as an emerging leader in the high-recovery water treatment market for data centers in its independent report, "Data Centers: Separating Water Hype from Reality," by Dr. Vishal Wagholikar.

The KMX team is working with several leading data center project developers to evaluate how our technology can help increase water recovery and enhance local water security.

We hope to share details on our first data center partnership soon. We believe the growing recognition that water stewardship needs to be considered at the front of data center development will support future growth in this new end-market.

Up Next:

Our Lunch & Learn event in NYC on Monday, "Crowding in Water Technology Capital for the Colorado River," will be the first of our Lunch & Learn series.

To receive invitations to future events, sign up for our newsletter at Contact Us | KMX Technologies.

The team is hard at work advancing our pilots, manufacturing capabilities, and next-generation technical developments.

In the months ahead, we hope to share:

1) Progress on these four commercial catalysts
2) New IP developments
3) More details on our Made in America VMD Initiative

Thank you for your continued support!

- Zac

Zachary Sadow

Chairman & CEO
KMX Technologies