Shares of ClearOne, Inc. (CLRO) have declined 26.8% since reporting results for the first quarter of 2025. This compares unfavorably with the S&P 500 index’s 2.5% decline during the same period. Over the past month, CLRO has lost 29.9%, while the broader index has gained 5.1%, highlighting the stock’s underperformance amid investor concerns.Revenue & EPS Show Sharp Y/Y DeclineClearOne’s first-quarter 2025 was marked by a substantial 36% revenue decline to $2.3 million from $3.6 million in the same period la ...

Financial Performance - Q1 2025 revenue was $2.3 million, a 36% decrease from $3.6 million in Q1 2024 and a 21.8% sequential decrease from $3.0 million in Q4 2024[5] - GAAP gross profit in Q1 2025 was $0.1 million, down 89% from $1.2 million in Q1 2024, resulting in a gross profit margin of 5% compared to 32% in Q1 2024[5] - GAAP net loss for Q1 2025 was $(2.8) million, or $(0.11) per share, compared to a net loss of $(1.9) million, or $(0.08) per share, in Q1 2024[5] - Revenue for the three months ended March 31, 2025, was $2,313 million, a decrease of 36.1% compared to $3,622 million in the same period of 2024[16] - Gross profit for the same period was $121 million, down from $1,151 million, reflecting a significant decline[16] - Operating loss increased to $2,846 million in Q1 2025 from $2,078 million in Q1 2024, indicating worsening financial performance[16] - Net loss for Q1 2025 was $2,834 million, compared to a net loss of $1,898 million in Q1 2024, representing a 49.2% increase in losses[16] - Non-GAAP net loss for Q1 2025 was $(2.8) million, or $(0.11) per share, compared to a Non-GAAP net loss of $(1.8) million, or $(0.07) per share, in Q1 2024[5] - Non-GAAP net loss for Q1 2025 was $2,760 million, compared to $1,762 million in Q1 2024, highlighting ongoing financial challenges[18] - Basic and diluted loss per share for Q1 2025 was $0.11, compared to $0.08 in Q1 2024, indicating a decline in shareholder value[16] - Comprehensive loss for Q1 2025 was $2,847 million, compared to $1,878 million in Q1 2024, further emphasizing the company's financial struggles[16] Operating Expenses and Cost Management - Operating expenses improved to $3.0 million in Q1 2025, down from $3.2 million in Q1 2024, reflecting continued cost-cutting measures[5] - Total operating expenses for Q1 2025 were $2,967 million, down from $3,229 million in Q1 2024, showing some cost management efforts[16] Inventory and Cash Management - Cash and cash equivalents decreased to $1.0 million as of March 31, 2025, down from $1.4 million as of December 31, 2024[7] - The company experienced a significant reduction in inventory levels, decreasing by approximately $1.4 million compared to December 31, 2024[5] - ClearOne is actively evaluating strategies to optimize inventory levels and production schedules to mitigate future impacts from cash flow constraints[5] - ClearOne secured a $1 million investment in February 2025 to restart product inventory purchases[2] Product Development - ClearOne introduced five new products in Q1 2025, including the award-winning BMA 360DX microphone array[2] Shareholder Impact - The number of shares used in computing diluted loss per share increased to 24,748,551 in Q1 2025 from 23,969,148 in Q1 2024, indicating potential dilution for existing shareholders[18] - Non-GAAP Adjusted EBITDA for Q1 2025 was $(2,686) million, compared to $(1,764) million in Q1 2024, reflecting continued operational difficulties[18]

Financial Performance - Overall revenue decreased by 36% in Q1 2025 compared to Q1 2024, primarily due to product shortages and reduced demand in key regions[58]. - Revenue decreased to $2.3 million in Q1 2025, a 36% decline from $3.6 million in Q1 2024, driven by a 37% drop in audio conferencing, 54% in video products, and 29% in microphones[76]. - Gross profit margin fell to 5.2% in Q1 2025 from 31.8% in Q1 2024, driven by a larger percentage decrease in revenue than in cost of goods sold[59]. - Operating loss increased to $2.8 million in Q1 2025 from $2.1 million in Q1 2024, representing a 37% adverse change[75]. - Net loss increased from $(1.9) million in Q1 2024 to $(2.8) million in Q1 2025, attributed to decreased revenues and gross margin[61]. - Cash used in operating activities was approximately $1.4 million in Q1 2025, a decrease of $1.8 million from cash provided in Q1 2024[88]. - As of March 31, 2025, cash and cash equivalents were approximately $0.9 million, down from $1.4 million as of December 31, 2024[87]. - Total operating expenses in Q1 2025 were $3.0 million, a slight decrease from $3.2 million in Q1 2024[81]. Strategic Initiatives - ClearOne is exploring strategic alternatives to maximize shareholder value, including potential mergers, acquisitions, or divestitures[62]. - The company faces substantial doubt about its ability to continue as a going concern without completing strategic transactions or raising additional capital[63]. - The company raised $1 million in a private placement transaction in February 2025 to address liquidity concerns[91]. Product Developments - The DIALOG® 20 USB wireless microphone system launched at ISE 2024 saw a 319% increase in unique visitors compared to 2023[51]. - The DIALOG® UVHF wireless microphone system received the 2024 Communications Solutions Products of the Year award[52]. - The BMA 360DX ceiling tile microphone array was launched with advanced features and won a Best of Show award at ISE 2025[53]. - The Versa® 120D USB-C Docking Station was introduced to enhance hybrid meeting experiences, supporting dual 4K60 displays[54]. Challenges and Risks - The company faced significant challenges due to supply chain issues and lack of component availability, impacting revenue growth[66]. - As of March 31, 2025, the company had open purchase orders of approximately $4.2 million, primarily for inventory[93]. - Deferred product revenue decreased to $12 thousand on March 31, 2025, compared to $17 thousand on December 31, 2024[72]. Accounting and Compliance - The company has maintained its critical accounting policies without changes since the last Annual Report for the year ended December 31, 2024[96]. - Recent accounting pronouncements are discussed in the notes to the unaudited condensed consolidated financial statements[97]. - There are no applicable quantitative and qualitative disclosures about market risk[98]. Dividend Announcement - ClearOne announced a one-time special cash dividend of $0.50 per share, paid on April 10, 2024[50].

Core Viewpoint - ClearOne, Inc. has experienced significant stock decline and revenue challenges, with a focus on product innovation and cost management to navigate these issues [1][13] Revenue & Earnings Performance - Fourth-quarter 2024 revenues were $3 million, a 29% decline from $4.2 million in the same quarter of 2023, but an 18.1% increase from $2.5 million in the third quarter of 2024 [2] - Gross profit for the quarter was $0.9 million, down 44% year-over-year, but up from $0.6 million in the previous quarter, with a gross margin of 30% [2] - The company reported a GAAP net loss of $2.2 million, or 9 cents per share, compared to a net income of $2.6 million, or 11 cents per share, in the prior year [3] Operating Metrics & Cost Management - Quarterly operating expenses were reduced by 12% to $2.9 million from $3.3 million in the fourth quarter of 2023, reflecting ongoing cost-cutting initiatives [4] - For the full year, operating expenses totaled $11.8 million, a 10% reduction from $13.1 million in 2023, contributing to a full-year GAAP net loss of $9.0 million [4] Non-GAAP Metrics - Non-GAAP adjusted EBITDA for the fourth quarter was negative $1.9 million, compared to a loss of $0.7 million in the same quarter of 2023, with an annual adjusted EBITDA loss of $8.2 million [5] Management Commentary - CEO Derek Graham emphasized the focus on accelerating product shipments and maintaining a lean cost structure, attributing revenue growth to operational discipline and demand for video and wireless solutions [6] - The company is addressing challenges related to past production shortfalls and the lack of Microsoft Teams certification for its products [6] Future Initiatives - Management aims to drive product innovation and enhance customer experiences, with plans to improve interoperability with third-party DSPs and increase investments in high-potential regions like the Middle East and India [7] Factors Behind Performance - Revenue performance was influenced by increased shipments of newer products, but the lack of Microsoft Teams certification for conferencing products remained a significant challenge [8] - The decline in gross profit was largely due to inventory write-offs, while higher legal and accounting expenses contributed to increased non-GAAP operating costs [8] Other Developments - In March 2024, ClearOne announced a special one-time cash dividend of 50 cents per share, indicating confidence in liquidity and long-term outlook [11] - The company ended the year with $1.4 million in cash and cash equivalents, down from $21.3 million at the end of 2023 [11] - New product launches included the DIALOG 20 USB and other systems designed for hybrid and BYOD collaboration environments [12]

Financial Performance - Q4 2024 revenue was $3.0 million, a decrease of 29% year-over-year from $4.2 million in Q4 2023, but an increase of 18.1% sequentially from $2.5 million in Q3 2024[7] - Total revenue for the year ended December 31, 2024, was $11,386,000, a decrease of 39% compared to $18,704,000 in 2023[18] - Gross profit for 2024 was $2,629,000, down from $6,357,000 in 2023, reflecting a gross margin decline[18] - Operating loss for the year was $9,211,000, compared to a loss of $6,772,000 in 2023, indicating increased operational challenges[18] - Net loss for 2024 was $8,983,000, significantly higher than the loss of $560,000 in 2023, resulting in a basic loss per share of $0.37[18] - Non-GAAP net loss for Q4 2024 was $(2.1) million, or $(0.09) per share, compared to a non-GAAP net loss of $(1.2) million, or $(0.05) per share, in Q4 2023[7] - Non-GAAP net loss for 2024 was $8,625,000, compared to a loss of $5,284,000 in 2023, indicating ongoing financial difficulties[20] - The company reported a comprehensive loss of $8,979,000 for 2024, compared to a loss of $582,000 in 2023, highlighting worsening financial performance[18] Operating Expenses - Full Year 2024 operating expenses decreased by 9.8% compared to the prior year[1] - Operating expenses for 2024 totaled $11,840,000, down from $13,129,000 in 2023, showing a reduction in spending[18] Assets and Liabilities - Cash, cash equivalents, and investments as of December 31, 2024, were $1.4 million, down from $21.3 million as of December 31, 2023[9] - Total current assets decreased to $18,753,000 in 2024 from $43,317,000 in 2023, a decline of approximately 57.5%[16] - Total liabilities reduced to $5,213,000 in 2024 from $6,009,000 in 2023, a decrease of about 13.2%[16] - Shareholders' equity fell to $21,331,000 in 2024 from $44,685,000 in 2023, representing a decline of approximately 52.3%[16] Product Development and Market Strategy - The company introduced new products to address the lack of Microsoft Teams certification, aiming to improve sales and customer engagement[2] - The DIALOG® 20 USB 2-Channel Wireless Microphone was launched at ISE 2024, enhancing hybrid meetings with low audio latency[5] - The company plans to expand its market presence in regions like the Middle East and India, where sales have shown strength[4] Dividends - A special one-time cash dividend of $0.50 per share was announced in March 2024, reflecting the company's strong balance sheet[5] Profitability Metrics - Q4 2024 gross profit was $0.9 million, with a gross profit margin of 30%, down from 38% in Q4 2023 but up from 24% in Q3 2024[7] - GAAP net loss for Q4 2024 was $(2.2) million, or $(0.09) per share, compared to a net income of $2.6 million, or $0.11 per share, in Q4 2023[7]

Revenue Performance - In 2024, total revenue was $11.4 million, a decrease of 39% from $18.7 million in 2023[72]. - Revenue from the United States was $3.8 million (33.3% of total revenue) in 2024, down from $8.2 million (43.9%) in 2023[72]. - International sales accounted for 66.7% of total revenue in 2024, compared to 56.1% in 2023[72]. - Revenue decreased by 39% to $11.4 million in 2024 compared to $18.7 million in 2023, with declines across all product categories[193]. - Revenue from audio conferencing products declined by 49%, microphones by 33%, and video products by 26% in 2024[202]. - Approximately 67% of revenue in 2024 was derived from international operations, with most revenue billed in U.S. dollars[198]. Product Contribution - Audio conferencing products contributed 37.7% and 44.7% of consolidated revenue in 2024 and 2023, respectively[27]. - Professional microphones accounted for 45.6% and 41.4% of consolidated revenue in 2024 and 2023, respectively[41]. - ClearOne's video products contributed 16.7% and 13.8% of consolidated revenue in 2024 and 2023, respectively[54]. - The share of audio-conferencing products in the revenue mix decreased from 45% in 2023 to 38% in 2024, while the share of microphones increased from 41% to 46%[203]. Product Development and Innovation - The company aims to improve product margins and reduce operational costs to enhance profitability[24]. - ClearOne plans to extend its total addressable market to include video collaboration and AV networking[24]. - The CONVERGE Pro 2 product line is designed to optimize diverse conferencing applications and environments[29]. - The CONVERGENCE Cloud software offers a unified AV network management platform with unlimited scalability[34]. - ClearOne intends to leverage software-based platforms across all product lines to enhance functionality[24]. - The company is focusing on product innovation, core product emphasis, and cost reduction to return to revenue growth and operating profits[204]. Financial Health and Concerns - As of December 31, 2024, the company had approximately $1.4 million in cash and cash equivalents, raising concerns about its ability to continue as a going concern[98]. - The company faces substantial doubt about its ability to continue as a going concern due to potential inability to generate profitable operations and secure necessary financing[99]. - The company has approximately 79 patents and 5 pending patent applications as of December 31, 2024[91]. - The company received a letter from Nasdaq on June 20, 2024, indicating non-compliance with the minimum bid price requirement, as the closing bid price was below $1.00 for 30 consecutive trading days, with the last reported price at $0.67 per share[142]. - The company is at risk of delisting from Nasdaq due to failure to hold an annual meeting of stockholders in 2024, as notified on January 10, 2025[146]. Operational Challenges - The company faced challenges in 2023 due to inventory shortages, impacting customer orders and market share[83]. - The company outsources manufacturing, exposing it to risks related to supply chain disruptions and increased costs, which could negatively impact product availability and revenues[113]. - The company has experienced significant impacts on operations and profitability due to switching manufacturing locations, particularly from China to Singapore[114]. - Intense competition in the market could adversely affect the company's operating results, particularly in video-related products, where competitors have greater resources[100]. - Estimating customer demand is challenging, which may negatively impact revenue and profit margins due to reliance on distributor orders based on end-user demand[101]. Cost Management - Total operating expenses decreased to $11.8 million in 2024 from $13.1 million in 2023, indicating a reduction in overall costs[208]. - Sales and Marketing (S&M) expenses decreased to $4.6 million in 2024 from $4.9 million in 2023, primarily due to reductions in employment and consultant expenses[210]. - Research and Development (R&D) expenses decreased from $3.7 million in 2023 to $3.3 million in 2024, mainly due to lower project-related and employment expenses[212]. - General and Administrative (G&A) expenses decreased to $4.0 million in 2024 from $4.6 million in 2023, primarily due to reduced amortization of capitalized legal costs and lower employment expenses[214]. Market and Competitive Landscape - The ongoing military action in Ukraine may increase financial market volatility and negatively impact the company's operations and financial condition[125]. - The company faces risks related to technological obsolescence, which could harm demand for its products and adversely affect revenue[130]. - The company relies on third-party technology and license agreements, and the loss of any such agreements could negatively impact its business operations[136]. Shareholder Information - Edward D. Bagley beneficially owns approximately 49.6% of the company's issued and outstanding shares, with family members and trusts owning an additional 14.9%[149]. - The company paid a special one-time cash dividend of $1.00 per share on June 1, 2023, and another special dividend of $0.50 per share on April 10, 2024[173]. - The company has suspended regular dividend payments, relying on stock price appreciation for shareholder benefits unless regular dividends are reinstated[153].

Financial Performance - Q3 2024 revenue was $2.5 million, a decrease of 49% compared to $4.9 million in Q3 2023, but an increase of 8.7% from $2.3 million in Q2 2024[5] - GAAP gross profit in Q3 2024 was $0.6 million, down 62% from $1.6 million in Q3 2023, with a gross profit margin of 24% compared to 33% in Q3 2023[6] - Operating expenses in Q3 2024 were $2.8 million, a 10% decrease from $3.1 million in Q3 2023, reflecting continued cost optimization efforts[7] - GAAP net loss in Q3 2024 was $(2.1) million, or $(0.09) per share, compared to a net loss of $(1.4) million, or $(0.06) per share, in Q3 2023[8] - Non-GAAP net loss in Q3 2024 was $(2.0) million, or $(0.08) per share, compared to a Non-GAAP net loss of $(1.2) million, or $(0.05) per share, in Q3 2023[9] - Operating loss for the three months ended September 30, 2024, was $(2,188,000), compared to $(1,489,000) for the same period in 2023, representing a 46.9% increase in loss[20] - Net loss for the three months ended September 30, 2024, was $(2,062,000), compared to $(1,351,000) in the same period of 2023, indicating a 52.5% increase in loss[20] - Non-GAAP operating loss for the three months ended September 30, 2024, was $(2,118,000), compared to $(1,315,000) for the same period in 2023[22] - Non-GAAP net loss for the three months ended September 30, 2024, was $(1,992,000), compared to $(1,177,000) in the same period of 2023[22] - Basic loss per share for the three months ended September 30, 2024, was $(0.09), compared to $(0.06) for the same period in 2023[20] Assets and Liabilities - As of September 30, 2024, cash, cash equivalents, and investments were $3.0 million, down from $22.2 million as of December 31, 2023[12] - Total current assets decreased to $23,039,000 as of September 30, 2024, down 46.8% from $43,317,000 at December 31, 2023[19] - Total liabilities decreased to $4,878,000 as of September 30, 2024, down 18.6% from $6,009,000 at December 31, 2023[19] - Shareholders' equity decreased to $23,501,000 as of September 30, 2024, down 47.4% from $44,685,000 at December 31, 2023[19] Market and Product Developments - The company recorded a 31% increase in unique visitors at the 2024 Infocomm India trade show, while overall attendance increased by only 17%[3] - ClearOne's BMA 360 beamforming microphone array won the Utah Innovation Awards in the Consumer Product Category, highlighting its advanced technology[3] - The company is focusing on regaining customers lost to competitors, with Q3 revenue increase indicating early signs of recovery[4] - The company anticipates continued recovery in sales as it addresses past production shortages and transitions to a new distributor in the Middle East[2]

Revenue Performance - Overall revenue decreased by 49% in Q3 2024 to $2.5 million compared to $4.9 million in Q3 2023, primarily due to a 50% decline in audio conferencing revenue [57]. - Revenue for the first nine months of 2024 decreased to $8.4 million from $14.6 million in the same period of 2023, reflecting a 48% decline in audio conferencing and a 39% decrease in microphones [70]. - Sales in the Americas declined by 61% in Q3 2024 compared to Q3 2023, with all sales regions experiencing revenue loss [69]. Profitability and Loss - Net loss increased to $(2.1) million in Q3 2024 from $(1.4) million in Q3 2023, driven by decreased revenues and gross margin [59]. - Gross profit margin decreased to 24.4% in Q3 2024 from 33.1% in Q3 2023, attributed to inventory scrapping and selling aged inventory at larger discounts [58]. Operating Expenses - Total operating expenses in Q3 2024 were $2.8 million, a decrease from $3.1 million in Q3 2023 [76]. - Research and Development (R&D) expenses decreased to $2.5 million for the nine months ended September 30, 2024, compared to $2.8 million for the same period in 2023 [79]. - General and Administrative (G&A) expenses decreased to $1.0 million in Q3 2024 from $1.1 million in Q3 2023, and YTD G&A expenses were $2.8 million compared to $3.4 million in 2023 [80]. - Interest expense was $0 in Q3 2024, down from $0.1 million in Q3 2023, and YTD interest expense decreased to $0.3 million from $0.5 million in 2023 [81]. Cash Flow and Position - Cash and cash equivalents as of September 30, 2024, were approximately $1.7 million, down from $17.8 million as of December 31, 2023 [85]. - Cash used in operating activities was approximately $4.6 million for the nine months ended September 30, 2024, a decrease of approximately $55.7 million from $51.1 million provided in the same period in 2023 [86]. - Cash provided by investing activities was $2.9 million for the nine months ended September 30, 2024, compared to $6.8 million used in the same period in 2023 [87]. - The company believes its current cash position will meet operating needs through at least November 14, 2025 [89]. Inventory and Purchases - As of September 30, 2024, total inventory was $16.5 million, including non-current inventory of $2.2 million, compared to total inventories of $13.8 million as of December 31, 2023 [90]. - The company had open purchase orders of approximately $3.5 million as of September 30, 2024, primarily for inventory purchases [90]. Strategic Initiatives - The company aims to return to operating profits through strategic initiatives focused on product innovation and cost reduction [60]. - The DIALOG® 20 USB wireless microphone system launched in January 2024 saw a 319% increase in unique visitors at ISE 2024 compared to 2023 [55]. - The company expects increased costs associated with electronic raw materials to continue affecting operations through 2024 and 2025 [57]. Geographic Revenue Distribution - Approximately 61.6% of revenue in the first nine months of 2024 was derived from operations outside North and South America [65].

Financial Performance - Q2 2024 revenue was $2.3 million, a 58% sequential decline and a 39% year-over-year decline from $5.5 million in Q2 2023[5] - GAAP gross profit in Q2 2024 was $(0.02) million, with a gross profit margin of -1%, down from 34% in Q2 2023[6] - Operating expenses in Q2 2024 were $2.9 million, a 9% decrease year-over-year from $3.2 million in Q2 2023[6] - GAAP net loss in Q2 2024 was $(2.8) million, or $(0.12) per share, compared to a net loss of $(1.0) million, or $(0.04) per share, in Q2 2023[7] - Non-GAAP net loss in Q2 2024 was $(2.7) million, or $(0.11) per share, compared to a Non-GAAP net loss of $(0.9) million, or $(0.04) per share, in Q2 2023[7] - Total revenue for the three months ended June 30, 2024, was $2,304,000, a decrease of 58% compared to $5,483,000 for the same period in 2023[18] - Gross profit for the three months ended June 30, 2024, was $(20,000), compared to a gross profit of $1,848,000 for the same period in 2023[18] - Operating loss for the three months ended June 30, 2024, was $(2,924,000), compared to an operating loss of $(1,355,000) for the same period in 2023[18] - Net loss for the three months ended June 30, 2024, was $(2,820,000), compared to a net loss of $(1,019,000) for the same period in 2023[18] - Basic loss per share for the three months ended June 30, 2024, was $(0.12), compared to $(0.04) for the same period in 2023[18] - Non-GAAP net loss for the three months ended June 30, 2024, was $(2,731,000), compared to $(865,000) for the same period in 2023[20] - Non-GAAP Adjusted EBITDA for the three months ended June 30, 2024, was $(2,660,000), compared to $(710,000) for the same period in 2023[20] Assets and Liabilities - Cash, cash equivalents, and investments as of June 30, 2024, were $4.9 million, down from $22.2 million as of December 31, 2023[10] - Total current assets decreased to $25,357,000 as of June 30, 2024, from $43,317,000 as of December 31, 2023, representing a decline of 41.5%[17] - Total liabilities decreased to $5,244,000 as of June 30, 2024, from $6,009,000 as of December 31, 2023, a reduction of 12.7%[17] - Shareholders' equity decreased to $25,552,000 as of June 30, 2024, from $44,685,000 as of December 31, 2023, a decline of 42.8%[17] Product Development and Market Activity - The company introduced the Versa Lite BMA 360D in Q2 2024, enhancing its product offerings for conferencing solutions[3] - Operating expenses improved by 10.1% sequentially and 9.33% year-over-year due to cost optimization initiatives[3] - The company captured 60% more sales leads at Infocomm USA 2024 compared to the previous year, indicating increased interest in its products[3] - The transition to a new distributor in the Middle East impacted sales, but the company anticipates continued growth in that region[2]

Revenue Performance - Overall revenue decreased to $2.3 million in Q2 2024, a 58% decline compared to $5.5 million in Q2 2023, primarily due to a 60.5% drop in audio conferencing revenue [45]. - Revenue from the Americas declined by 64% in Q2 2024, from Europe and Africa by 41%, and from Asia Pacific by 50% compared to Q2 2023 [53]. - Approximately 61% of revenue in the first half of 2024 came from operations outside North and South America [51]. Profitability and Loss - Gross profit margin fell to (0.9)% in Q2 2024 from 33.7% in Q2 2023, and to 19.1% in the first half of 2024 from 32.7% in the first half of 2023 [46]. - Net loss increased to $2.8 million in Q2 2024 from $1.0 million in Q2 2023, and to $4.7 million in the first half of 2024 from $1.9 million in the first half of 2023 [46]. - Inventory write-offs and price mark-downs could affect profitability due to long-term inventory of approximately $1.4 million in various products [58]. Operating Expenses - Total operating expenses decreased to $2.9 million in 2024-Q2 from $3.2 million in 2023-Q2, and $6.1 million in 2024-H1 compared to $6.7 million in 2023-H1 [59]. - Sales and marketing (S&M) expenses decreased to $1.2 million in 2024-Q2 from $1.3 million in 2023-Q2, while remaining consistent at $2.5 million for 2024-H1 compared to 2023-H1 [60]. - Research and development (R&D) expenses were consistent at $0.9 million in 2024-Q2 compared to 2023-Q2, but decreased to $1.8 million in 2024-H1 from $1.9 million in 2023-H1 [60]. - General and administrative (G&A) expenses decreased to $0.8 million in 2024-Q2 from $1.0 million in 2023-Q2, and to $1.9 million in 2024-H1 from $2.3 million in 2023-H1 [61]. Cash Flow and Liquidity - Cash and cash equivalents were approximately $2.5 million as of June 30, 2024, down from $17.8 million as of December 31, 2023 [65]. - Cash used in operating activities was approximately $2.7 million in the six months ended June 30, 2024, a decrease of approximately $55.6 million from $52.9 million in the same period of 2023 [65]. - Cash provided by investing activities was $1.8 million in the six months ended June 30, 2024, compared to $7.4 million used in the same period of 2023 [66]. Inventory and Purchases - As of June 30, 2024, total inventory was $16.4 million, up from $13.8 million as of December 31, 2023 [68]. - The company had open purchase orders of approximately $3.02 million mostly for inventory purchases as of June 30, 2024 [67]. Market Challenges - The company faced sales headwinds due to the lack of Microsoft Teams certification, impacting product demand despite functional compatibility [45]. - The company expects increased costs associated with electronic raw materials to continue through 2024 and 2025 [45]. New Product Launch - The DIALOG® 20 USB wireless microphone system launched on January 23, 2024, with a 319% increase in unique visitors at ISE 2024 compared to 2023 [44]. Interest Expense - Interest expense was $0 in 2024-Q2 and 2024-H1, down from $0.1 million and $0.4 million in 2023-Q2 and 2023-H1 respectively, due to repayment of all debts [62].