Core Insights - Airship AI Holdings, Inc. has been awarded a $4.0 million contract from the Department of Homeland Security for its AI-driven surveillance solutions [1][2] - The contract supports the agency's efforts to enhance public safety and address challenges such as human trafficking and narcotics smuggling [2] - Airship AI's technology aims to transform traditional sensors into smart sensors, improving operational efficiency without the need for costly replacements [3] Company Overview - Airship AI, founded in 2006 and headquartered in Redmond, Washington, specializes in AI-driven video, sensor, and data management solutions [5] - The company's product suite includes the Outpost AI edge hardware, Acropolis enterprise management software, and Command visualization tools [5] - Airship AI focuses on predictive analysis and providing actionable intelligence to enhance decision-making for public sector and commercial customers [5] Technology and Solutions - The Acropolis backend system allows agencies to manage various sensors and devices from multiple manufacturers through a single interface, leading to significant cost savings [2][3] - The Outpost AI Edge Appliance processes and encrypts data in real-time, enabling agencies to identify and respond to objects of interest effectively [3] - Airship AI's sensor-agnostic approach facilitates integration with existing systems, enhancing operational capabilities without the need for complete overhauls [3]

Group 1 - Airship AI Holdings, Inc. closed a public offering with net proceeds of approximately $7.04 million after deducting fees and expenses [1][2] - The offering included 2,882,883 shares of common stock and warrants to purchase an equal number of shares at a combined price of $2.775 per share [1][2] - Each share was sold with a warrant that has an exercise price of $2.65, is immediately exercisable, and expires five years after issuance [1][2] Group 2 - Roth Capital Partners and The Benchmark Company acted as co-placement agents for the offering [2] - The net proceeds will be used for working capital and general corporate purposes [2] Group 3 - The offering was made under an effective registration statement on Form S-1 filed with the SEC on August 7, 2024, and became effective on August 29, 2024 [3] - The offering was conducted solely through a prospectus [3] Group 4 - Airship AI, founded in 2006, is a technology company based in Redmond, Washington, specializing in AI-driven video, sensor, and data management surveillance solutions [5] - The company's products aim to enhance public safety and operational efficiency for both public sector and commercial customers [5] - Airship AI's product suite includes Outpost AI edge hardware, Acropolis enterprise management software, and Command visualization tools [5]

Core Points - Airship AI Holdings, Inc. announced a public offering of 2,882,883 shares of common stock and warrants at a combined price of $2.775 per share [1] - The offering is expected to generate approximately $8.0 million in gross proceeds for the company [2] - The company plans to use the net proceeds for working capital and general corporate purposes [2] Offering Details - Each share of common stock is sold with one warrant to purchase an additional share at an exercise price of $2.65, which is exercisable immediately and expires in five years [1] - The closing of the offering is anticipated on or about September 3, 2024, pending customary closing conditions [1] Company Overview - Airship AI, founded in 2006 and headquartered in Redmond, Washington, specializes in AI-driven video, sensor, and data management surveillance solutions [5] - The company's product suite includes Outpost AI edge hardware, Acropolis enterprise management software, and Command visualization tools, aimed at enhancing public safety and operational efficiency [5]

Financial Performance - Second Quarter 2024 net revenues reached $6.4 million, with a gross profit of $4.5 million and a gross margin of 70%[2] - Operating income for the quarter was $1.0 million, indicating progress towards the company's goal of being cash flow positive for the full year[2] - First half 2024 combined net revenue totaled $17.0 million, representing 128% of the company's total revenue for the full year 2023[1] - Total net revenues for the three months ended June 30, 2024, reached $6,401,031, a significant increase from $2,770,018 in the same period of 2023, representing a growth of approximately 131%[19] - Gross profit for the six months ended June 30, 2024, was $7,134,334, compared to $2,477,616 for the same period in 2023, indicating a year-over-year increase of about 187%[19] - Operating income for the three months ended June 30, 2024, was $976,316, a turnaround from an operating loss of $3,084,512 in the same quarter of 2023[19] - The company reported a net income of $18,461,995 for the three months ended June 30, 2024, compared to a net loss of $3,103,279 in the same period of 2023[19] Revenue Growth and Contracts - The total validated pipeline increased to approximately $150 million, including $30 million in new opportunities from a successful pilot for a federal agency[4] - Backlog as of June 30, 2024, was approximately $2.0 million, expected to be invoiced in the third and fourth quarters of 2024[3] - The company announced a six-figure contract award with a Fortune 100 transportation and e-commerce company for the Acropolis platform expansion[5] - The company anticipates triple-digit revenue growth and positive cash flow for calendar year 2024, supported by a strong pipeline and improving gross profit margins[6] - Airship AI has onboarded several new large state and local law enforcement agencies, with over 25 agencies currently in acquisition or testing phases[5] - The company completed multiple firm-fixed price contracts worth $10.9 million for advanced integrated solutions supporting real-time intelligence operations along U.S. borders[4] Cash Flow and Expenses - Cash and cash equivalents decreased to $226,750 as of June 30, 2024, from $3,124,413 at the end of 2023, indicating a decline of about 93%[17] - Net cash used in operating activities was $(4,146,868) compared to $(737,102) in the previous period[21] - Net cash provided by financing activities amounted to $1,240,221, a decrease from $2,660,042 in the prior period[21] - Research and development expenses for the six months ended June 30, 2024, were $1,398,137, slightly higher than $1,339,283 for the same period in 2023[19] - Selling, general, and administrative expenses decreased to $6,162,414 for the six months ended June 30, 2024, down from $5,925,016 in the same period of 2023[19] Liabilities and Stockholder's Equity - Total liabilities increased to $33,271,809 as of June 30, 2024, up from $23,575,140 at the end of 2023, reflecting a rise of approximately 41%[17] - The company’s total stockholders' deficit increased to $(27,966,537) as of June 30, 2024, compared to $(17,487,227) at the end of 2023[17] - The weighted average shares of common stock outstanding for the six months ended June 30, 2024, were 23,220,709, compared to 22,812,048 for the same period in 2023[19] Fair Value Changes and Stock Issuance - Loss from change in fair value of warrant liability was $5,304,744[21] - Loss from change in fair value of earnout liability totaled $6,607,923[21] - Issuance of common stock for debt interest payment was $487,642[21] - Issuance of common stock for debt conversion reached $835,610[21] - Proceeds from convertible promissory note were $1,984,582[21] - Accounts payable - trade and accrued expenses decreased by $(1,426,970)[21] - Deferred revenue decreased by $(1,299,813) compared to an increase of $678,623 in the previous period[21]

Strong Second Quarter 2024 Net Revenues of $6.4 Million, Gross Profit of $4.5 Million and Gross Margin of 70% Second Quarter Operating Income of $1.0 Million Represents Significant Progress Towards Full Year Cash Flow Positive Objective First Half 2024 Combined Net Revenue of $17.0 Million Represents 128% of the Company's Full Year Revenue in 2023 REDMOND, Wash., Aug. 14, 2024 (GLOBE NEWSWIRE) -- Airship AI Holdings, Inc. (NASDAQ: AISP) ("Airship AI" or the "Company"), a leader in AI-driven video, sensor, a ...

Financial Performance - Net revenues for the three months ended June 30, 2024, increased by $3,631,000 to $6,401,000 compared to $2,770,000 for the same period in 2023, driven by increased product sales[139] - Gross profit for the three months ended June 30, 2024, increased by 169.3% to $4,506,000 compared to $1,673,000 for the same period in 2023[139] - Operating income for the three months ended June 30, 2024, was $976,000, a significant improvement from a loss of $3,084,000 in the same period in 2023, representing a variance of 131.6%[139] - The company reported a net income of $18,462,000 for the three months ended June 30, 2024, compared to a net loss of $3,103,000 for the same period in 2023, reflecting a variance of 695.0%[139] - Net revenues for the six months ended June 30, 2024 increased by $11,267,000 to $16,976,000, a 197.4% increase compared to $5,709,000 for the same period in 2023[143] - Gross profit for the six months ended June 30, 2024 was $7,134,000, an increase of $4,656,000 or 187.9% compared to $2,478,000 for the same period in 2023[144] - Net income for the three months ended June 30, 2024 was $18,462,000, compared to a net loss of $3,103,000 for the same period in 2023[142] - Other income for the three months ended June 30, 2024 was $17,486,000, a significant increase from other expense of $19,000 in the same period of 2023[141] Expenses - Research and development expenses for the three months ended June 30, 2024, increased by $38,000 to $703,000 compared to $665,000 for the same period in 2023[140] - Research and development expenses for the six months ended June 30, 2024 increased by $59,000 to $1,398,000 compared to $1,339,000 for the same period in 2023[144] - Selling, general and administrative expenses for the six months ended June 30, 2024 increased by $237,000 to $6,162,000 compared to $5,925,000 for the same period in 2023[144] Liabilities and Cash Position - Total liabilities measured at fair value as of June 30, 2024, amounted to $20,389,999, compared to $8,626,779 as of December 31, 2023[130] - Net cash used in operating activities for the six months ended June 30, 2024 was $4,147,000, primarily due to a net loss of $13,502,000[151] - As of June 30, 2024, the company had cash of approximately $227,000 and accounts receivable of approximately $3,440,000[150] - The accumulated deficit as of June 30, 2024 was $30,979,000, with a working capital deficit of approximately $6,712,000[150] Business Developments - The company received purchase orders from various federal government agency customers totaling over $13 million, with partial shipments made during the three months ended June 30, 2024[139] - The merger with BYTS closed on December 21, 2023, with Airship AI Holdings, Inc. becoming the accounting acquiror under the ticker symbol "AISP"[128] - The company anticipates a shift towards cloud-based software solutions, which will create additional subscription revenue opportunities in the future[132] - The company plans to expand its edge AI-based solutions, focusing on real-time intelligent decision-making capabilities for customers[134] Lease Agreements - The company entered into a lease for 15,567 square feet of office and warehouse space in Redmond, WA, starting October 1, 2023, with a monthly payment of $25,000, expiring on October 31, 2027, and a 3% increase in payment each year thereafter[157] - A lease extension was made for 3,621 square feet in Moorestown, North Carolina, with a net monthly payment of $6,488, expiring on August 29, 2024[157] Accounting Policies - The company does not have any off-balance sheet arrangements that could materially affect its financial condition, revenue, or expenses[158] - The consolidated financial statements are prepared in accordance with U.S. GAAP, requiring estimates and assumptions that could differ materially from actual results due to economic uncertainties[159] - Significant accounting policies have not materially changed from those discussed in the Annual Report for the year ended December 31, 2023[160]

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EXHIBIT 99.1 EX-99.1 2 airsp_ex991.htm PRESS RELEASE Airship AI Reports First Quarter 2024 Financial Results Strong First Quarter 2024 Net Revenues of $10.6 Million Support Fiscal Year 2024 Triple-Digit Revenue Growth & Positive Cash Flow Objectives First Quarter 2024 Net Revenues of $10.6 Million Represent 84.5% of the Company's Full Year Revenue in 2023 Awarded Second Contract by DOJ Agency for $2.35 Million for Company's Outpost AI Appliance to Support Emerging Public Safety and Investigative Requirement ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: March 31, 2024 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to _____________ Commission File No. 001-40222 AIRSHIP AI HOLDINGS, INC. (Exact name of registrant as specified in its charter) (State or other jur ...