Financial Data and Key Metrics - Total revenue for Q3 2024 increased by 8% to $4.6 million compared to $4.2 million in Q3 2023 [17] - Subscription software revenue increased to $1.76 million, with SaaS growing by 8.5% and software maintenance revenue remaining flat [18] - Professional services revenue increased by 11.5% to $2.6 million, representing 56.7% of total revenue [18] - Consolidated gross margin decreased slightly by 20 basis points to 61.1% due to unfavorable projects in document conversion services [19] - SaaS margins decreased slightly to 83.7% from 84.5% but remain strong [20] - Operating expenses increased by 37.3% to $3.1 million, driven by share-based compensation, sales and marketing investments, and general administrative expenses [21] - Net loss for Q3 was $393,000 compared to net income of $209,000 in Q3 2023 [23] - Adjusted EBITDA for Q3 was $479,000, down from $709,000 in Q3 2023 [23] - Cash position at September 30, 2024, was $2.5 million, with total assets of $19 million and total liabilities of $8.6 million [24] - Debt principal outstanding was $1.3 million after $800,000 in prepayments during the quarter [25] Business Line Performance - Payables Automation Solution (IPAS) is the primary growth driver, with strong customer acceptance and additional functionality around purchase orders expected by year-end [8][12] - IPAS is being deployed in the K12 ecosystem with a beta customer already live and additional orders secured [13] - The company is actively pursuing opportunities with niche ERP providers to outperform generic solutions [14] Market Performance - The company presented at the Build Smarter Homebuilding Industry Conference, where a customer showcased strong ROI from IPAS, leading to significant interest [11] - The K12 market, while having smaller transaction volumes, offers faster implementation times compared to homebuilders [13] Strategic Direction and Industry Competition - The company is investing in scaling its business, including hiring additional sales reps, an implementations manager, and expanding marketing efforts [15] - Investments are expected to temporarily reduce EBITDA but are anticipated to bring revenue opportunities that will exceed the spend by 2025 [15] - The company is focusing on integrating IPAS with new ERP systems and expanding into new verticals [31][33] Management Commentary on Operating Environment and Future Outlook - Management is optimistic about the future, citing strong SaaS assets, a cash-generating business model, and a competitive position in growing markets [38] - The company expects to grow revenues year-over-year for fiscal 2024, with adjusted EBITDA expected to decrease modestly due to increased investments [26] Other Important Information - The company has paid out $2.7 million in acquisition earnouts since 2021 and reduced long-term debt by $3.6 million since December 2022 [9] - The company has a strong deferred revenue position, particularly due to government and K12 contracts running from July to June [24] Q&A Session Summary Question: Total number of live IPAS customers entering 2025 - The company expects to have 11 or 12 customers live by early 2025, with a significant new customer providing $250,000 in annual revenue [27] Question: Pipeline potential from the homebuilders trade show - The company had a strong presence at the trade show, with over 50 attendees at their breakout session and positive feedback from a customer testimonial [28][29] Question: Pace of implementations and functionality - The company anticipates faster implementations as they formalize their release schedule and improve tools and product knowledge [30] Question: Expansion to other ERP systems - The company is actively working on integrating IPAS with other ERP systems, including a co-marketing agreement with Software Unlimited for the K12 market [31][33] Question: SaaS revenue inflection point - The company expects a meaningful inflection point in SaaS revenue in the second half of 2025, as new deals signed in late 2024 will start recognizing revenue in early 2025 [34][35] Question: Activity in Michigan - The company expects activity in Michigan to remain consistent through the end of the year, with low expectations for government-related business until the New Year [36][37]

Core Insights - Intellinetics, Inc. reported a quarterly loss of $0.09 per share, significantly missing the Zacks Consensus Estimate of $0.01, and compared to earnings of $0.05 per share a year ago, resulting in an earnings surprise of -1,000% [1] - The company posted revenues of $4.59 million for the quarter ended September 2024, missing the Zacks Consensus Estimate by 2.13%, but showing an increase from $4.25 million year-over-year [2] - Intellinetics shares have increased approximately 185.2% since the beginning of the year, outperforming the S&P 500's gain of 25.5% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is -$0.06 on revenues of $4.26 million, and for the current fiscal year, it is -$0.07 on revenues of $18.09 million [7] - The estimate revisions trend for Intellinetics is mixed, leading to a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Industry Context - The Internet - Content industry, to which Intellinetics belongs, is currently in the top 31% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8]

Revenue Performance - Total revenue for Q3 2024 was $4,589,625, an increase of 8.0% compared to $4,248,429 in Q3 2023[6] - SaaS revenue increased by 8.5% year-over-year, contributing significantly to the overall revenue growth[2] - Professional services revenue rose by 11.5% compared to the same period in 2023, reflecting strong demand[4] - Year-to-date revenue for 2024 reached $13,738,302, an increase of 8.2% compared to $12,693,692 for the same period in 2023[9] - Total revenues for the three months ended September 30, 2024, were $4,589,625, an increase of 8.0% compared to $4,248,429 for the same period in 2023[20] - Software as a service revenue for the three months ended September 30, 2024, was $1,403,942, up 8.5% from $1,293,745 in 2023[20] - Professional services revenue increased to $2,600,230 for the three months ended September 30, 2024, compared to $2,333,090 in 2023, reflecting an increase of 11.5%[20] - Recurring revenue grew by 2.6%, representing 58.6% of total revenue, highlighting the stability of income streams[6] Profitability and Loss - Net loss for Q3 2024 was $392,850, or $(0.09) per share, compared to a net income of $209,331, or $0.05 per share in Q3 2023[8] - Adjusted EBITDA for Q3 2024 was $479,537, down from $708,749 in Q3 2023, indicating a decline in operational profitability[8] - Net loss for the nine months ended September 30, 2024, was $492,514 compared to a net income of $457,628 in 2023[24] Operating Expenses - Total operating expenses increased by 37.3% to $3,104,065, driven by higher share-based compensation and increased sales and marketing investments[7] - Share-based compensation rose significantly to $1,185,330 from $349,073 in 2023, indicating increased employee compensation costs[24] Cash Flow and Assets - Net cash provided by operating activities increased to $3,652,417 from $1,128,314 in the previous year, representing a growth of approximately 224%[24] - Cash at the end of the period increased to $2,501,729 from $1,689,125 in 2023, showing a positive cash flow trend[24] - Total current assets increased to $5,514,625 as of September 30, 2024, from $5,004,375 as of December 31, 2023[21] - Cash balance increased to $2,501,729 as of September 30, 2024, compared to $1,215,248 as of December 31, 2023[21] Liabilities and Equity - Total liabilities decreased to $8,590,848 as of September 30, 2024, from $9,275,539 as of December 31, 2023[22] - Total stockholders' equity increased to $10,443,537 as of September 30, 2024, from $9,750,721 as of December 31, 2023[23] Future Outlook - Management expects revenue growth to continue year-over-year for the fiscal year 2024, despite anticipated declines in Adjusted EBITDA due to increased investments[10] - The company plans to continue investing in sales and marketing to drive future growth, particularly through the IPAS solution[3] Deferred Revenues - Deferred revenues increased to $3,468,109 as of September 30, 2024, compared to $2,927,808 as of December 31, 2023, indicating growth in future revenue recognition[22] - Deferred revenues increased to $540,301 from $378,061 in 2023, suggesting growth in future revenue recognition[24]

Revenue Performance - Revenues for Q3 2024 were $4,589,625, representing an 8.0% increase year over year, while revenues for the nine-month period 2024 were $13,738,302, reflecting an 8.2% growth compared to the same period in 2023[97][101]. - The Document Management segment generated revenues of $1,913,116 in Q3 2024, up from $1,871,395 in Q3 2023, and $5,592,624 for the nine-month period 2024, compared to $5,549,194 in the same period last year[111]. - The Document Conversion segment reported revenues of $2,676,509 in Q3 2024, an increase from $2,377,034 in Q3 2023, and $8,145,678 for the nine-month period 2024, compared to $7,144,498 in the prior year[111]. - Revenues for Q3 2024 increased by $341,196, or 8.0%, and for the nine-month period by $1,044,610, or 8.2%, primarily driven by software as a service and professional services in the Document Conversion segment[113]. - Software as a Service revenues rose by $110,197, or 8.5%, in Q3 2024 and by $399,591, or 10.5%, in the nine-month period compared to the same periods in 2023, mainly due to new cloud-based solution sales[114]. - Professional services revenues increased by $267,140, or 11.5%, in Q3 2024 and by $811,571, or 11.7%, in the nine-month period, driven by a significant project in Document Conversion[115]. Operating Expenses - Operating expenses (excluding cost of revenues) for the nine-month period 2024 increased by 28.2% to $8,869,062, driven primarily by share-based compensation and investments in sales and marketing[102]. - Total operating expenses for Q3 2024 were $3,104,065, up from $2,260,036 in Q3 2023, marking an increase of 38.4%[127]. - General and administrative expenses increased by $597,833, or 39.4%, in Q3 2024 compared to Q3 2023, primarily due to new share-based compensation expenses[127]. - Sales and marketing expenses rose by $206,211, or 41.6%, in Q3 2024 over Q3 2023, driven by the expansion of the sales team[129]. Profitability - The net loss for Q3 2024 was $392,850, with a basic and diluted net loss per share of $0.09, compared to a net income of $209,331 and earnings per share of $0.05 in Q3 2023[100]. - Gross profit for Q3 2024 was $2,805,854, compared to $2,605,591 in Q3 2023, with a gross profit percentage of 61.1%[121]. - Overall gross profit decreased to 61.1% in Q3 2024 from 61.3% in Q3 2023, but increased to 63.4% for the nine-month period 2024 from 61.8% in 2023[123]. - The gross profit percentage for professional services improved to 45.0% in Q3 2024 from 42.6% in Q3 2023[121]. Cash Flow - Operating cash provided was $1,933,562 in Q3 2024, compared to $1,427,945 in Q3 2023, indicating improved cash flow from operations[100]. - Net cash provided by operating activities during the nine-month period 2024 was $3,652,417, compared to $1,128,314 in the same period of 2023[139]. - Net cash used in investing activities in the nine-month period 2024 was $695,359, including $302,396 in capitalized software[140]. - As of September 30, 2024, the company had $2.5 million in cash and cash equivalents and a working capital deficit of $0.2 million[134]. Workforce and Growth - The company had 199 employees as of September 30, 2024, an increase from 165 employees a year earlier, reflecting growth in workforce to support business expansion[105]. - The company anticipates continued growth driven by the demand for software as a service (SaaS) solutions, particularly in light of the increasing adoption of remote workforce policies[92][93]. - The company is focusing on expanding its cloud-based solutions and data storage offerings to drive future growth[114]. Challenges and Risks - The company anticipates a significant adverse impact on future professional services revenues due to potential pricing renegotiations with its largest Document Conversion customer[115]. - The company experienced a higher than normal churn rate in K-12 customers affecting the growth of the YellowFolder product[114]. - Cost of Software as a Service (SaaS) increased by $28,819, or 14.4%, in Q3 2024 compared to Q3 2023, while gross margin decreased to 83.7% from 84.5%[124]. - Cost of Professional Services rose by $92,715, or 6.9%, in Q3 2024 over Q3 2023, with gross margins increasing to 45.0% from 42.6%[125]. Customer Contracts - The company secured a renewal contract with its largest customer, with an estimated net rate increase of approximately 21% effective October 1, 2023[133].

Company Performance - Intellinetics, Inc. reported quarterly earnings of $0.02 per share, missing the Zacks Consensus Estimate of $0.04 per share, and down from $0.03 per share a year ago, representing an earnings surprise of -50% [1] - The company posted revenues of $4.64 million for the quarter ended June 2024, surpassing the Zacks Consensus Estimate by 0.69%, and up from $4.26 million year-over-year [2] - Over the last four quarters, Intellinetics has surpassed consensus revenue estimates three times, but has only exceeded EPS estimates once [2] Stock Performance - Intellinetics shares have increased approximately 78.7% since the beginning of the year, significantly outperforming the S&P 500's gain of 12.1% [3] - The current Zacks Rank for Intellinetics is 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $0.06 on revenues of $4.82 million, and for the current fiscal year, it is $0.08 on revenues of $18.48 million [7] - The outlook for the Internet - Content industry, to which Intellinetics belongs, is currently in the bottom 42% of Zacks industries, which may impact the stock's performance [8]

Revenue Performance - Revenues for Q2 2024 were $4,641,593, representing a year-over-year growth of 9.0%[81] - Revenues for the six-month period 2024 totaled $9,148,677, reflecting an 8.3% increase compared to the same period in 2023[83] - Revenues increased by $383,163, or 9.0%, in Q2 2024 and by $703,414, or 8.3%, in the six-month period 2024, driven by software as a service and professional services[92] - Software as a Service revenues rose by $122,673, or 9.6%, in Q2 2024 and by $289,394, or 11.5%, in the six-month period 2024, primarily due to new cloud-based solution sales[93] - Professional services revenues increased by $364,042, or 15.8%, in Q2 2024 and by $544,431, or 11.8%, in the six-month period 2024, with a strong pipeline in Document Conversion[94] Operating Expenses - Operating expenses (excluding cost of revenues) for the six-month period 2024 were $5,764,997, an increase of 23.8% year over year[83] - Operating expenses totaled $2,830,873 in Q2 2024, an increase from $2,294,045 in Q2 2023, with general and administrative expenses rising by $463,857[106] - General and administrative expenses increased by $463,857, or 29.7%, in Q2 2024 compared to Q2 2023, and by $1,037,739, or 33.3%, in the six-month period 2024 compared to 2023[107] - Sales and marketing expenses rose by $38,136, or 7.7%, in Q2 2024 compared to Q2 2023, and increased by $246, or 0.0%, in the six-month period 2024 over 2023[108] - Depreciation and amortization increased by $34,835, or 14.5%, in Q2 2024 compared to Q2 2023, and by $71,127, or 15.2%, in the six-month period 2024 compared to 2023[109] Profitability - Net loss for the six-month period 2024 was $99,664, compared to a net income of $248,297 for the same period in 2023[85] - Gross profit margin improved to 64.7% in Q2 2024 from 60.8% in Q2 2023 and to 64.5% in the six-month period 2024 from 62.0% in the six-month period 2023[102] - Professional services gross margins increased to 49.5% in Q2 2024 from 43.1% in Q2 2023, reflecting stabilization of wages and price increases[104] Cash Flow and Financing - Operating cash generated in Q2 2024 was $1,107,089, compared to cash used of $125,274 in Q2 2023[82] - Net cash provided by operating activities was $1,718,855 in the six-month period 2024, compared to a net cash used of $299,631 in the same period of 2023[118] - Net cash used in investing activities was $398,766 in the six-month period 2024, compared to $291,101 in the same period of 2023[119] - Net cash used by financing activities was $825,000 in repayment of notes payable during the six-month period 2024, compared to $700,000 in earnout liability payments in the same period of 2023[120] - As of June 30, 2024, the company had approximately $1.7 million in cash and cash equivalents and a net working capital of $0.5 million[112] Employee and Market Outlook - As of June 30, 2024, the company employed 189 individuals, an increase from 170 employees a year prior[85] - The company anticipates continued growth driven by the demand for SaaS solutions amid economic recovery[86] - The inflationary environment has led to increased labor costs, which the company has mitigated through customer renewal rate adjustments[86] - The company anticipates potential pricing renegotiations with its largest customer, which may adversely impact future professional services revenues[94] - The company secured a renewal contract with its largest customer, with an estimated net rate increase of approximately 21% effective from October 1, 2023[113] Debt and Indebtedness - Outstanding long-term indebtedness as of June 30, 2024, consisted of the 2022 Notes with an aggregate outstanding principal balance of $2,139,500[116]

Revenue Performance - Total revenue for Q2 2024 was $4,641,593, representing a 9.0% increase compared to $4,258,430 in Q2 2023[4] - SaaS revenue increased by 9.6% year-over-year, driven by the commercialization of the IPAS solution, which doubled its live reference accounts to four[2] - Professional services revenue rose 15.8% compared to the same period in 2023, marking a record revenue quarter for Q2 2024[5] - Year-to-date revenues for the first half of 2024 were $9,148,677, an 8.3% increase from $8,445,263 in the same period of 2023[6] - Recurring revenue grew 6.6% and represented 57% of total revenue in Q2 2024[4] - Recurring revenue for Q2 2024 was $2,629,821, up 6.6% from $2,467,066 in Q2 2023[15] - Software as a service revenue for Q2 2024 was $1,400,591, a rise of 9.6% from $1,277,918 in Q2 2023[16] - Professional services revenue increased to $2,662,358 in Q2 2024, up 15.9% from $2,298,316 in Q2 2023[16] Profitability and Income - Net income for Q2 2024 was $75,050, or $0.02 per share, down from $135,734, or $0.03 per share, in Q2 2023[5] - Net income for Q2 2024 was $75,050, compared to a net income of $135,734 in Q2 2023, reflecting a decrease of approximately 44.7%[16] - Adjusted EBITDA for Q2 2024 increased by 7.1% to $698,217, compared to $651,646 in Q2 2023[5] - Adjusted EBITDA for Q2 2024 was $1,371,579, compared to $1,281,525 in Q2 2023, indicating a growth of 7.0%[16] - Management expects revenue growth for the fiscal year 2024 but has revised expectations for Adjusted EBITDA to decline modestly compared to 2023 due to increased investments[7] Expenses and Liabilities - Total operating expenses increased by 23.4% to $2,830,873, driven by higher non-cash depreciation and planned investments in sales and marketing[5] - General and administrative expenses increased to $2,025,796 in Q2 2024, compared to $1,561,939 in Q2 2023, reflecting a rise of 29.6%[16] - Interest expense decreased to $97,056 in Q2 2024 from $160,654 in Q2 2023, a reduction of 39.5%[16] - Total liabilities decreased to $8,516,362 from $9,275,539, a reduction of approximately 8.19%[17] - Total long-term liabilities decreased to $3,855,825 from $4,888,757, a decrease of approximately 21.06%[17] Cash Flow and Assets - Cash provided by operating activities was $1,718,855, a turnaround from $(299,631) in the prior year[18] - Cash at the end of the period rose to $1,680,669 from $1,130,487, marking an increase of about 48.54%[18] - Total current assets increased to $5,183,690 from $5,004,375, representing a growth of approximately 3.57%[17] - Accounts receivable, net decreased to $1,449,188 from $1,850,375, a decline of approximately 21.66%[17] - Stockholders' equity increased to $10,346,362 from $9,750,721, reflecting an increase of about 6.11%[17] Debt Management - The company plans to prepay an additional $800,000 of long-term debt before the end of August 2024, reducing debt principal to approximately $1.3 million[4] Shareholder Information - The weighted average number of common shares outstanding increased to 4,229,518 in Q2 2024 from 4,073,757 in Q2 2023[16] - The company reported a basic net income per share of $0.02 for Q2 2024, down from $0.03 in Q2 2023[16] Share-Based Compensation - Share-based compensation increased significantly to $695,305 from $233,617, an increase of approximately 197.06%[18] Capital Expenditures - Capitalization of internal use software was $(198,051), slightly lower than $(208,417) in the previous year[18]

Financial Data and Key Metrics Changes - Total revenue for Q1 2024 increased by 7.7% to $4.5 million compared to $4.2 million in Q1 2023 [51] - Operating expenses rose by 24.2% to $2.9 million for Q1 2024, primarily due to investments in structure and timing of equity compensation expenses [10] - Loss per share was $0.04, compared to earnings per share of $0.03 last year, while adjusted EBITDA for the quarter was $673,000, slightly up from $630,000 in the same period last year [11][34] - SaaS revenue as a percentage of consolidated revenue increased to 31% in Q1 2024, up from approximately 29% in Q1 2023 [47] Business Line Data and Key Metrics Changes - Subscription software revenue, which includes SaaS and software maintenance services, increased to $1.76 million for the quarter, with SaaS growing by 13.5% [51] - Professional services revenue increased by 7.8% to $2.5 million for the quarter, maintaining 55% of total revenue [33] - The document conversion segment continues to generate positive contribution margin, although its non-recurring revenue is becoming less relevant [6][30] Market Data and Key Metrics Changes - The company signed nine new customers for its IPAS solution, with an expected combined annual revenue of $500,000, and anticipates doubling the customer count in the coming quarters [8][31] - The K-12 market has seen significant growth, with 597 districts generating substantial SaaS revenue, more than doubling the presence since the Yellow Folder acquisition [50] Company Strategy and Development Direction - The company is accelerating investment in marketing its SaaS offerings, focusing on maximizing promotional activities around SaaS rather than non-recurring revenue streams [5][7] - The management aims to evolve into a fully SaaS-centric company, with a goal of making recurring revenue the majority of total revenue [49] - The company plans to prepay additional debt, aiming for no net debt by the end of 2024, which reflects a focus on financial health [12] Management Comments on Operating Environment and Future Outlook - Management expressed optimism regarding the strong response to the IPAS solution and the growing pipeline of opportunities [28] - The company anticipates that the organic growth opportunities may become less consistent over time, particularly in the document conversion business [30][36] - Management reiterated expectations for revenue growth year-over-year for fiscal year 2024, despite potential revenue reductions from a major customer [54] Other Important Information - Total liabilities were reported at $8.8 million, including $2.6 million in deferred revenues and $2.46 million in debt principal as of March 31 [35] - The company is increasing its sales and marketing efforts, including hiring additional sales representatives and enhancing tradeshow activities [52] Q&A Session Summary Question: What is the total number of sales reps and their structure? - The company added one sales rep, and they are structured to support both the IPAS team and K-12 operations [57][58] Question: Is the incremental spend on support or implementation staff? - Yes, the company is investing in support staff to ensure effective implementation and customer satisfaction [65][66]

[Cautionary Note Regarding Forward-Looking Statements](index=4&type=section&id=CAUTIONARY%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) The report contains forward-looking statements based on current plans, intentions, objectives, strategies, projections, and expectations, which are subject to substantial risks, uncertainties, and other factors beyond the company's control - The report contains forward-looking statements based on current plans, intentions, objectives, strategies, projections, and expectations, which are subject to substantial risks, uncertainties, and other factors beyond the company's control[8](index=8&type=chunk)[9](index=9&type=chunk) - Key areas of forward-looking statements include the effects of economic conditions, future financial performance (revenues, net income, cash flow), integration of acquisitions, product development, market position, capital resources, and competitive landscape[10](index=10&type=chunk) - Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the report date, and the company undertakes no obligation to update or revise them[11](index=11&type=chunk)[12](index=12&type=chunk) [Part I – Financial Information](index=6&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) This section presents the company's unaudited condensed consolidated financial statements and management's discussion and analysis of financial condition and results of operations [Item 1. Financial Statements](index=6&type=section&id=ITEM%201.%20Financial%20Statements) This section presents Intellinetics, Inc.'s unaudited condensed consolidated financial statements and detailed notes for Q1 2024 and 2023 [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This statement provides a snapshot of the company's assets, liabilities, and stockholders' equity at specific points in time Condensed Consolidated Balance Sheets (Unaudited) | ASSETS (in $) | March 31, 2024 | December 31, 2023 | | :-------------------------------- | :------------- | :---------------- | | Cash | 1,184,944 | 1,215,248 | | Accounts receivable, net | 1,931,342 | 1,850,375 | | Total current assets | 5,029,106 | 5,004,375 | | Property and equipment, net | 880,740 | 924,257 | | Intangible assets, net | 3,781,761 | 3,909,338 | | Goodwill | 5,789,821 | 5,789,821 | | Total assets | 18,916,186 | 19,026,260 | | **LIABILITIES AND STOCKHOLDERS' EQUITY** | | | | Accounts payable | 278,486 | 194,454 | | Deferred revenues | 2,583,207 | 2,927,808 | | Total current liabilities | 4,851,104 | 4,386,782 | | Notes payable - net of current portion | 1,438,032 | 2,209,242 | | Total liabilities | 8,896,347 | 9,275,539 | | Total stockholders' equity | 10,019,839 | 9,750,721 | | Total liabilities and stockholders' equity | 18,916,186 | 19,026,260 | - Total assets decreased slightly from **$19.03 million** at December 31, 2023, to **$18.92 million** at March 31, 2024[16](index=16&type=chunk) - Total stockholders' equity increased from **$9.75 million** to **$10.02 million**, while total liabilities decreased from **$9.28 million** to **$8.90 million**[16](index=16&type=chunk) [Condensed Consolidated Statements of Operations](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This statement details the company's revenues, expenses, and net income or loss over a specific period Condensed Consolidated Statements of Operations (Unaudited) | (in $) | For the Three Months Ended March 31, 2024 | For the Three Months Ended March 31, 2023 | | :-------------------------------- | :---------------------------------------- | :---------------------------------------- | | Total revenues | 4,507,084 | 4,186,833 | | Total cost of revenues | 1,607,440 | 1,540,994 | | Gross profit | 2,899,644 | 2,645,839 | | Total operating expenses | 2,934,124 | 2,361,840 | | (Loss) income from operations | (34,480) | 283,999 | | Interest expense, net | (140,234) | (171,436) | | Net (loss) income | (174,714) | 112,563 | | Basic net (loss) income per share | (0.04) | 0.03 | | Diluted net (loss) income per share | (0.04) | 0.03 | - Total revenues increased by **7.6%** year-over-year, from **$4.19 million** in Q1 2023 to **$4.51 million** in Q1 2024[18](index=18&type=chunk) - The company reported a **net loss of $174,714** in Q1 2024, compared to a **net income of $112,563** in Q1 2023, resulting in a basic and diluted net loss per share of **$0.04**[18](index=18&type=chunk) [Condensed Consolidated Statement of Stockholders' Equity](index=8&type=section&id=Condensed%20Consolidated%20Statement%20of%20Stockholders'%20Equity) This statement outlines changes in the company's equity accounts, including common stock, additional paid-in capital, and accumulated deficit Condensed Consolidated Statement of Stockholders' Equity (Unaudited) | (in $) | Common Stock (Shares) | Common Stock (Amount) | Additional Paid-in Capital | Accumulated Deficit | Total Stockholders' Equity | | :----------------------- | :-------------------- | :-------------------- | :------------------------- | :------------------ | :------------------------- | | Balance, December 31, 2023 | 4,113,621 | 4,114 | 30,841,630 | (21,095,023) | 9,750,721 | | Stock Option Compensation | - | - | 115,456 | - | 115,456 | | Restricted Share Issuance | - | - | 328,376 | - | 328,376 | | Net Loss | - | - | - | (174,714) | (174,714) | | Balance, March 31, 2024 | 4,113,621 | 4,114 | 31,285,462 | (21,269,737) | 10,019,839 | - Total stockholders' equity increased from **$9.75 million** at December 31, 2023, to **$10.02 million** at March 31, 2024, despite a net loss, primarily due to stock option compensation and restricted share issuance[20](index=20&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This statement reports the cash generated and used by the company across operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows (Unaudited) | (in $) | For the Three Months Ended March 31, 2024 | For the Three Months Ended March 31, 2023 | | :---------------------------------------- | :---------------------------------------- | :---------------------------------------- | | Net (loss) income | (174,714) | 112,563 | | Net cash provided by (used in) operating activities | 611,766 | (174,357) | | Net cash used in investing activities | (127,932) | (134,569) | | Net cash used in financing activities | (514,138) | (968,417) | | Net decrease in cash | (30,304) | (1,277,343) | | Cash - beginning of period | 1,215,248 | 2,696,481 | | Cash - end of period | 1,184,944 | 1,419,138 | - Net cash provided by operating activities significantly improved, moving from a **use of $174,357** in Q1 2023 to a **provision of $611,766** in Q1 2024[22](index=22&type=chunk) - Cash at the end of the period decreased slightly to **$1.18 million** in Q1 2024 from **$1.22 million** at the beginning of the period, but this represents a much smaller decrease compared to Q1 2023[22](index=22&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes provide additional information and explanations for the figures presented in the condensed consolidated financial statements [1. Business Organization and Nature of Operations](index=10&type=section&id=1.%20Business%20Organization%20and%20Nature%20of%20Operations) This section describes Intellinetics, Inc.'s operational structure and its core business activities in digital transformation - Intellinetics, Inc. operates through two wholly-owned subsidiaries: Intellinetics Ohio and Graphic Sciences, providing digital transformation products and services[24](index=24&type=chunk) - The company's two reporting segments are Document Management (software platform for document capture and management) and Document Conversion (paper-to-digital conversion, storage, and retrieval services)[25](index=25&type=chunk) [2. Basis of Presentation](index=10&type=section&id=2.%20Basis%20of%20Presentation) This section outlines the accounting principles and standards used in preparing the unaudited condensed consolidated financial statements - The unaudited condensed consolidated financial statements are prepared in accordance with GAAP, including normal recurring adjustments, and should be read in conjunction with the Annual Report on Form 10-K for the fiscal year ended December 31, 2023[26](index=26&type=chunk)[27](index=27&type=chunk)[28](index=28&type=chunk) [3. Summary of Significant Accounting Policies](index=10&type=section&id=3.%20Summary%20of%20Significant%20Accounting%20Policies) This section details the key accounting policies and methods applied in the preparation of the financial statements - The company consolidates all subsidiaries where it holds a controlling interest, eliminating significant intercompany balances and transactions[29](index=29&type=chunk) - The allowance for credit losses for trade receivables was **$109,515** at March 31, 2024, a decrease from **$124,103** at December 31, 2023, reflecting a reduction charged to operating results[33](index=33&type=chunk)[34](index=34&type=chunk) - Revenue is categorized into software, SaaS, software maintenance, professional services, and storage/retrieval, with the majority from professional services, followed by software maintenance and SaaS[35](index=35&type=chunk) - Deferred revenue, representing amounts billed but not yet recognized, decreased from **$2.93 million** at December 31, 2023, to **$2.58 million** at March 31, 2024[38](index=38&type=chunk)[40](index=40&type=chunk) - Software development costs for internal use software of **$109,621** were capitalized in Q1 2024, amortized over three years, while expensed software development costs were **$159,731**[42](index=42&type=chunk)[43](index=43&type=chunk) - The company maintains a **100% valuation allowance** on deferred tax assets due to uncertainty of realizing future taxable income, with federal net operating loss carryforwards of approximately **$15.5 million** as of March 31, 2024[52](index=52&type=chunk)[54](index=54&type=chunk) Segment Revenues and Gross Profit (Unaudited) | Segment (in $) | Three months ended March 31, 2024 | Three months ended March 31, 2023 | | :-------------------- | :-------------------------------- | :-------------------------------- | | **Revenues:** | | | | Document Management | 1,820,420 | 1,769,483 | | Document Conversion | 2,686,664 | 2,417,350 | | Total revenues | 4,507,084 | 4,186,833 | | **Gross profit:** | | | | Document Management | 1,556,893 | 1,483,108 | | Document Conversion | 1,342,751 | 1,162,731 | | Total gross profit | 2,899,644 | 2,645,839 | [4. Intangible Assets, Net](index=17&type=section&id=4.%20Intangible%20Assets%2C%20Net) This section details the company's intangible assets, including trade names, proprietary technology, and customer relationships Intangible Assets, Net (in $) | Category | March 31, 2024 (Net) | December 31, 2023 (Net) | | :-------------------- | :------------------- | :-------------------- | | Trade names | 212,808 | 220,233 | | Proprietary technology | 688,800 | 710,325 | | Customer relationships | 2,880,153 | 2,978,780 | | Total | 3,781,761 | 3,909,338 | - Intangible assets, net, decreased from **$3.91 million** at December 31, 2023, to **$3.78 million** at March 31, 2024, primarily due to amortization[61](index=61&type=chunk) - Amortization expense for the three months ended March 31, 2024, was **$127,577**[61](index=61&type=chunk) [5. Fair Value Measurements](index=17&type=section&id=5.%20Fair%20Value%20Measurements) This section discusses the company's fair value measurements, specifically regarding earnout liabilities - The company paid its final earnout liability of **$700,000** in January 2023, with no remaining earnout liabilities as of March 31, 2023[63](index=63&type=chunk) [6. Property and Equipment](index=17&type=section&id=6.%20Property%20and%20Equipment) This section provides details on the company's property and equipment, including computer hardware, leasehold improvements, and depreciation Property and Equipment, Net (in $) | Category | March 31, 2024 | December 31, 2023 | | :-------------------------------- | :------------- | :---------------- | | Computer hardware and purchased software | 1,455,334 | 1,437,023 | | Leasehold improvements | 395,919 | 395,919 | | Furniture and fixtures | 324,296 | 324,296 | | Less: accumulated depreciation | (1,294,809) | (1,232,981) | | Property and equipment, net | 880,740 | 924,257 | - Net property and equipment decreased from **$924,257** at December 31, 2023, to **$880,740** at March 31, 2024[64](index=64&type=chunk) - Total depreciation expense for Q1 2024 was **$61,828**, consistent with **$61,939** in Q1 2023[64](index=64&type=chunk) [7. Notes Payable](index=18&type=section&id=7.%20Notes%20Payable) This section details the company's notes payable to unrelated parties, including principal amounts and future payment obligations Notes Payable to Unrelated Parties (in $) | Category | March 31, 2024 | December 31, 2023 | | :-------------------------------- | :------------- | :---------------- | | Notes payable – "2022 Unrelated Notes" | 1,864,500 | 2,364,500 | | Less unamortized debt issuance costs | (101,468) | (155,258) | | Less current portion | (325,000) | - | | Long-term portion of notes payable | 1,438,032 | 2,209,242 | - The long-term portion of notes payable to unrelated parties decreased from **$2.21 million** at December 31, 2023, to **$1.44 million** at March 31, 2024, reflecting a **$500,000** principal prepayment[65](index=65&type=chunk) - Future minimum principal payments for unrelated notes include **$325,000** due in 2025 and **$1.54 million** due in 2026[65](index=65&type=chunk) [8. Notes Payable - Related Parties](index=19&type=section&id=8.%20Notes%20Payable%20-%20Related%20Parties) This section details the company's notes payable to related parties, including principal amounts and interest expense Notes Payable to Related Parties (in $) | Category | March 31, 2024 | December 31, 2023 | | :-------------------------------- | :------------- | :---------------- | | Notes payable – "2022 Related Note" | 600,000 | 600,000 | | Less unamortized debt issuance costs | (32,593) | (39,398) | | Long-term portion of notes payable | 567,407 | 560,602 | - The long-term portion of notes payable to related parties remained stable at approximately **$567,407** at March 31, 2024, with the full principal of **$600,000** due in 2026[67](index=67&type=chunk) - Interest expense for related party notes was **$24,805** in Q1 2024, slightly down from **$25,879** in Q1 2023[68](index=68&type=chunk) [9. Commitments and Contingencies](index=19&type=section&id=9.%20Commitments%20and%20Contingencies) This section outlines the company's legal proceedings, claims, litigation, and future minimum lease payment obligations - The company is involved in ordinary course legal proceedings, claims, and litigation, but currently believes no current matter is expected to have a material adverse impact on its financial position or operations[69](index=69&type=chunk) Future Minimum Lease Payments (in $) | For the twelve months ending March 31, | Finance Leases | Operating Leases | | :------------------------------------- | :------------- | :--------------- | | 2025 | 89,954 | 951,885 | | 2026 | 89,954 | 950,991 | | 2027 | 71,204 | 578,184 | | 2028 | 63,855 | 358,282 | | 2029 | 39,194 | 76,821 | | Thereafter | 1,883 | - | | Less Imputed Interest | (55,024) | (333,209) | | Total | 301,020 | 2,582,954 | - Total operating lease expense for Q1 2024 was **$234,439**, slightly down from **$237,449** in Q1 2023[73](index=73&type=chunk) [10. Stockholders' Equity](index=22&type=section&id=10.%20Stockholders'%20Equity) This section details the company's common stock, outstanding shares, and shares reserved for warrants and equity incentive plans - As of March 31, 2024, there were **4,113,621 shares** of common stock issued and outstanding, with additional shares reserved for warrants and equity incentive plans[74](index=74&type=chunk) Outstanding Warrants as of March 31, 2024 | Warrants Outstanding | Exercise Price ($) | Expiry Date | | :------------------- | :----------------- | :---------- | | 124,258 | 4.62 | March 30, 2027 | | 95,500 | 4.00 | March 30, 2027 | | 16,000 | 9.00 | March 30, 2027 | | 17,200 | 12.50 | March 30, 2027 | | 3,000 | 15.00 | March 30, 2027 | [11. Stock-Based Compensation](index=23&type=section&id=11.%20Stock-Based%20Compensation) This section outlines the company's stock-based compensation expenses related to restricted stock grants and stock options - On March 19, 2024, **127,500 shares** of restricted common stock were granted to employees, resulting in **$397,901** of stock compensation expense for Q1 2024[78](index=78&type=chunk) - Stock-based compensation for options was **$115,456** in Q1 2024, with **$432,525** of total unrecognized compensation costs related to stock options as of March 31, 2024[81](index=81&type=chunk)[82](index=82&type=chunk) [12. Concentrations](index=24&type=section&id=12.%20Concentrations) This section highlights significant customer and revenue concentrations, particularly with the State of Michigan and government contracts - The State of Michigan, the largest customer, accounted for **48% of total revenues** in Q1 2024 (up from 34% in Q1 2023) and **60% of gross accounts receivable** as of March 31, 2024[83](index=83&type=chunk)[85](index=85&type=chunk) - Government contracts, including K-12 education, represented approximately **86% of net revenues** in Q1 2024, an increase from 72% in Q1 2023[84](index=84&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=ITEM%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section discusses Intellinetics' Q1 2024 financial condition and results, covering revenue growth, economic impacts, expenses, liquidity, and cash flows [Company Overview](index=25&type=section&id=Company%20Overview) This section provides an overview of Intellinetics' business model, operational segments, and key growth strategies - Intellinetics is a document services and software solutions company focused on digital transformation and process automation for small-to-medium businesses and governmental sectors[88](index=88&type=chunk) - The company operates through Document Management (software platform) and Document Conversion (paper-to-digital, storage, retrieval) segments, with a growing emphasis on the SaaS model[88](index=88&type=chunk)[89](index=89&type=chunk) - Key growth strategies include investing in market penetration, optimizing pricing, increasing sales force effectiveness, and improving lead generation[90](index=90&type=chunk) [Executive Overview of Results](index=26&type=section&id=Executive%20Overview%20of%20Results) This section provides a high-level summary of the company's financial performance for Q1 2024, including revenue, operating loss, and cash flow - Revenues increased by **$320,251**, or **7.6%** year-over-year, primarily due to growth in software as a service and professional services[93](index=93&type=chunk)[97](index=97&type=chunk) - The company reported a **loss from operations of $34,480** in Q1 2024, compared to **income from operations of $283,999** in Q1 2023, largely impacted by a **$397,901** stock compensation expense[93](index=93&type=chunk)[97](index=97&type=chunk) - Net cash provided by operating activities was **$611,766** in Q1 2024, a significant improvement from **$174,357 used** in Q1 2023[97](index=97&type=chunk) - Employee count increased to **180** (including 36 part-time) as of March 31, 2024, from **167** as of March 31, 2023[97](index=97&type=chunk) [Financial Impact of Current Economic Conditions](index=26&type=section&id=Financial%20Impact%20of%20Current%20Economic%20Conditions) This section assesses the impact of current economic conditions, such as inflation and supply chain disruptions, on the company's financial performance - Increased employee wages due to inflation slightly decreased profit margins in Q1 2024, but the company is mitigating this by increasing customer renewal rates[95](index=95&type=chunk) - Global supply chain disruptions have had minimal impact, and customer demand has not diminished due to adverse economic conditions as of the report date[96](index=96&type=chunk) [Results of Operations](index=27&type=section&id=Results%20of%20Operations) This section provides a detailed analysis of the company's revenues, costs of revenues, gross profits, and operating expenses [Revenues](index=27&type=section&id=Revenues) This section analyzes the company's revenue streams by source, highlighting growth in SaaS and professional services Revenues by Source (in $) | Revenue Source | Three months ended March 31, 2024 | Three months ended March 31, 2023 | | :-------------------------- | :-------------------------------- | :-------------------------------- | | Sale of software | 5,779 | 15,293 | | Software as a service | 1,405,153 | 1,238,432 | | Software maintenance services | 357,983 | 349,542 | | Professional services | 2,479,678 | 2,299,289 | | Storage and retrieval services | 258,491 | 284,277 | | Total revenues | 4,507,084 | 4,186,833 | - Total revenues increased by **7.6%** year-over-year, primarily driven by a **13.5% growth** in Software as a Service (SaaS) and a **7.8% increase** in professional services[98](index=98&type=chunk) - SaaS revenues grew by **$166,721** due to new cloud-based solution sales and expanded services for existing customers[99](index=99&type=chunk) - Professional services revenues increased by **$180,389**, mainly from the Document Conversion segment, but future revenues are at risk due to potential renegotiation of pricing with the largest customer[100](index=100&type=chunk) [Costs of Revenues and Gross Profits](index=29&type=section&id=Costs%20of%20Revenues%20and%20Gross%20Profits) This section examines the costs associated with revenue generation and the resulting gross profit margins across different service categories Cost of Revenues by Source (in $) | Cost of Revenues | Three months ended March 31, 2024 | Three months ended March 31, 2023 | | :-------------------------- | :-------------------------------- | :-------------------------------- | | Sale of software | 5,065 | 8,181 | | Software as a service | 215,992 | 220,640 | | Software maintenance services | 15,710 | 16,716 | | Professional services | 1,284,063 | 1,187,116 | | Storage and retrieval services | 86,610 | 108,341 | | Total cost of revenues | 1,607,440 | 1,540,994 | - Total cost of revenues increased by **4.3%** year-over-year to **$1.61 million**[102](index=102&type=chunk) - Overall gross profit percentage increased to **64.3%** in Q1 2024 from **63.2%** in Q1 2023, driven by the higher mix of SaaS revenue and strong Document Management margins, partially offset by margin erosion in Document Conversion[103](index=103&type=chunk) - Cost of SaaS decreased by **2.1%** due to support efficiencies, leading to an increased gross margin of **84.6%** for SaaS[104](index=104&type=chunk) - Cost of professional services increased by **8.2%** due to increased staffing and wage increases in the Document Conversion segment, resulting in a slight decrease in consolidated professional services gross margin to **48.2%**[105](index=105&type=chunk) [Operating Expenses](index=31&type=section&id=Operating%20Expenses) This section analyzes changes in general and administrative, sales and marketing, and depreciation and amortization expenses Operating Expenses (in $) | Operating Expenses | Three months ended March 31, 2024 | Three months ended March 31, 2023 | | :-------------------------- | :-------------------------------- | :-------------------------------- | | General and administrative | 2,128,493 | 1,554,611 | | Sales and marketing | 541,621 | 579,511 | | Depreciation and amortization | 264,010 | 227,718 | | Total operating expenses | 2,934,124 | 2,361,840 | - Total operating expenses increased by **24.2%** year-over-year to **$2.93 million**[106](index=106&type=chunk) - General and administrative expenses increased by **36.9%**, primarily due to a **$397,901** restricted stock award grant and investments in scaling operations (development, finance, SOC2 process, ERP system upgrade) and wage increases[107](index=107&type=chunk) - Sales and marketing expenses decreased by **6.5%** due to an open position and normal fluctuations in commissions[108](index=108&type=chunk) - Depreciation and amortization increased by **15.9%** due to increased amortization of capitalized software costs[109](index=109&type=chunk) [Other Items of Income and Expense](index=32&type=section&id=Other%20Items%20of%20Income%20and%20Expense) This section focuses on non-operating income and expense items, specifically detailing changes in net interest expense - Net interest expense decreased by **18.2%** to **$140,234** in Q1 2024, primarily due to reduced interest from principal repayments of the 2020 Notes[110](index=110&type=chunk) [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) This section assesses the company's ability to meet its short-term and long-term financial obligations, including cash position, working capital, and debt obligations - As of March 31, 2024, the company had **$1.2 million** in cash and cash equivalents, **$0.2 million** in net working capital, and an accumulated deficit of **$21.3 million**[112](index=112&type=chunk) - Liquidity was improved by a renewed contract with the largest customer (estimated **21% net rate increase**) and an extension of maturity dates for **$1.5 million** of Unrelated Notes and **$0.6 million** of Related Notes to December 31, 2025[113](index=113&type=chunk) - The largest customer may renegotiate pricing, which could adversely impact future revenues, cash flows, and liquidity[113](index=113&type=chunk) - Current debt obligations include **$0.3 million** due by March 30, 2025, and **$2.1 million** due by December 31, 2025; operating cash flow alone may be insufficient to meet 2025 obligations, but the company is confident in its ability to seek additional financing or refinancing[114](index=114&type=chunk) - Net cash provided by operating activities was **$611,766** in Q1 2024, a significant improvement from cash used in Q1 2023[121](index=121&type=chunk) - Net cash used in financing activities was **$514,138** in Q1 2024, primarily for repayment of notes payable (**$500,000**) and finance lease liabilities[123](index=123&type=chunk) [Critical Accounting Policies and Estimates](index=34&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section confirms that no material changes occurred in the company's critical accounting policies and estimates during Q1 2024 - The preparation of financial statements requires estimates and assumptions, but there were no material changes to critical accounting policies and estimates during Q1 2024[124](index=124&type=chunk)[125](index=125&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk.](index=34&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk.) This item is not applicable to Intellinetics, Inc. as it is a smaller reporting company - This section is not applicable to smaller reporting companies[126](index=126&type=chunk) [Item 4. Controls and Procedures.](index=34&type=section&id=ITEM%204.%20Controls%20and%20Procedures.) Management concluded the company's disclosure controls and procedures were effective as of March 31, 2024, with no material changes in internal control over financial reporting - As of March 31, 2024, the company's disclosure controls and procedures were deemed effective to provide reasonable assurance that required information is recorded, processed, summarized, and reported timely[128](index=128&type=chunk) - No material changes in internal control over financial reporting occurred during the first quarter of 2024[130](index=130&type=chunk)[131](index=131&type=chunk) [Part II – Other Information](index=36&type=section&id=PART%20II%20OTHER%20INFORMATION) This section provides additional information on legal proceedings, risk factors, equity sales, defaults, and other disclosures [Item 1. Legal Proceedings.](index=36&type=section&id=ITEM%201.%20Legal%20Proceedings.) The company reported no material legal proceedings during the period - There are no legal proceedings to report[133](index=133&type=chunk) [Item 1A. Risk Factors.](index=36&type=section&id=ITEM%201A.%20Risk%20Factors.) No material changes to risk factors were reported, except for a new significant risk regarding potential pricing renegotiation with the largest customer - No material changes to risk factors were reported, except for a new risk concerning the largest customer potentially renegotiating pricing on a significant portion of work[134](index=134&type=chunk)[135](index=135&type=chunk) - Such a renegotiation could take effect in Q4 2024 and, if resulting in a pricing reduction, could materially and adversely affect the company's business, operating results, and cash flows, despite potential mitigation efforts[135](index=135&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.](index=36&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds.) The company reported no unregistered sales of equity securities or use of proceeds during the period - There were no unregistered sales of equity securities or use of proceeds[136](index=136&type=chunk) [Item 3. Defaults Upon Senior Securities.](index=36&type=section&id=ITEM%203.%20Defaults%20Upon%20Senior%20Securities.) The company reported no defaults upon senior securities during the period - There were no defaults upon senior securities[137](index=137&type=chunk) [Item 4. Mine Safety Disclosures.](index=36&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosures.) This item is not applicable to the company - This section is not applicable[138](index=138&type=chunk) [Item 5. Other Information.](index=36&type=section&id=ITEM%205.%20Other%20Information.) No Rule 10b5-1 or non-Rule 10b5-1 trading arrangements were adopted, modified, or terminated by directors or Section 16 officers during Q1 2024 - No Rule 10b5-1 or non-Rule 10b5-1 trading arrangements were adopted, modified, or terminated by directors or Section 16 officers during Q1 2024[139](index=139&type=chunk) [Item 6. Exhibits.](index=36&type=section&id=ITEM%206.%20Exhibits.) This section lists all exhibits filed as part of the Quarterly Report on Form 10-Q, including certifications, XBRL documents, and taxonomy extensions - The report includes certifications from the Principal Executive Officer and Principal Financial Officer (Exhibits 31.1, 31.2, 32.1, 32.2) and various Inline XBRL documents (Exhibits 101.INS, 101.SCH, 101.CAL, 101.DEF, 101.LAB, 101.PRE, 104)[141](index=141&type=chunk)[142](index=142&type=chunk) [Signatures](index=38&type=section&id=SIGNATURES) This section includes the official signatures of the company's President, CEO, and CFO, certifying the report's accuracy - The report was signed by James F. DeSocio, President and Chief Executive Officer, and Joseph D. Spain, Chief Financial Officer, on May 14, 2024[144](index=144&type=chunk)[145](index=145&type=chunk)

Exhibit 99.1 Intellinetics Grows 2024 First Quarter Revenues 7.7%, Grows SaaS Revenue 13.5% COLUMBUS, OH – May 14, 2024 – Intellinetics, Inc. (NYSE American: INLX), a digital transformation solutions provider, announced financial results for the three months ended March 31, 2024, the first quarter of 2024. 2024 First Quarter Financial Highlights | | | For the Quarter ended March 31, | | | | --- | --- | --- | --- | --- | | | 2024 | | 2023 | | | Revenues: | | | | | | Sale of software | $ | 5,779 | $ | 15,293 ...