Revenue Growth - Second quarter revenue increased by 59% year over year, from $1.3 million to $2.1 million[2] - First half of 2024 revenue rose by 90% year over year, from $2.3 million to $4.4 million[2] - Annual recurring revenue surged approximately 500%, from $450 thousand to $2.7 million[2] Funding and Financial Position - The company raised $26.5 million through a public offering of $11.5 million and a private placement of $15 million[2] - All remaining convertible notes and other debt totaling $7.05 million were converted to equity, eliminating future liabilities[5] - The company demonstrated compliance with NASDAQ listing requirements by significantly strengthening shareholders' equity[3] Business Development - MSAI launched its Inspections business, expanding service offerings to meet enterprise customer needs[3] - A strategic channel partnership was established with Denali Advanced Integration to facilitate customer access to MSAI's solutions[3] Losses - Operating loss for Q2 2024 was $4.847 million, compared to a loss of $3.161 million in Q2 2023[9] - Net loss for the first half of 2024 was $10.316 million, compared to a loss of $3.560 million in the same period of 2023[9]

Revenue Performance - Revenue for the three months ended June 30, 2024, was $2,125,000, compared to $1,337,000 for the same period in 2023, representing a 59% increase[20]. - For the six months ended June 30, 2024, total revenue was $4,400, up 90% from $2,317 in the prior year[55]. - Revenue for the three months ended June 30, 2024, was approximately $2.1 million, an increase of $0.8 million, or 59%, from approximately $1.3 million for the same period in 2023[139]. Net Loss and Financial Health - Net loss for the six months ended June 30, 2024, was $10,316,000, compared to a net loss of $3,560,000 for the same period in 2023, indicating a significant increase in losses[20]. - The company has a history of net losses and negative cash flows, raising substantial doubt about its ability to continue as a going concern[13]. - The company incurred losses due to negative net working capital and increased investment in technology innovation and commercial capabilities compared to the prior year periods[161]. - The company has substantial doubt about its ability to continue as a going concern for the next twelve months due to the need to raise additional capital and ongoing operating losses[163]. Operating Expenses - Operating loss for the three months ended June 30, 2024, was $(4,847,000), compared to $(3,161,000) for the same period in 2023, reflecting a worsening operational performance[20]. - Selling, general and administrative expenses increased from $2,246,000 for the three months ended June 30, 2023, to $2,810,000 for the same period in 2024, a rise of about 25%[20]. - Total operating expenses for the three months ended June 30, 2024, were approximately $6.4 million, an increase of $3.9 million, or 152%, from approximately $2.6 million for the same period in 2023[142]. Cash and Liquidity - Cash and cash equivalents decreased from $1,155,000 as of December 31, 2023, to $234,000 as of June 30, 2024, a decline of approximately 80%[17]. - The company reported a net cash used in operating activities of $189 for the second quarter of 2024, compared to a net cash used of $298 in the same period of 2023[25]. - Net cash provided by operating activities for the six months ended June 30, 2024, was $189 thousand, a significant improvement from a net cash used of $298 thousand in the same period of 2023[178][179]. Shareholder Equity and Stock Issuance - As of June 30, 2024, the total shareholders' equity was $1,552, down from $6,907 as of June 30, 2023, reflecting a decrease in retained earnings[22]. - The company issued 182,348 shares of common stock during the second quarter of 2024, raising $500 in capital[25]. - The company completed a public offering of 6,250,000 shares at a price of $1.60 per share, generating gross proceeds of $10 million before expenses[106]. Assets and Liabilities - Total current assets decreased from $12,513,000 as of December 31, 2023, to $8,996,000 as of June 30, 2024, a decline of approximately 28%[17]. - Total liabilities decreased from $16,640,000 as of December 31, 2023, to $14,858,000 as of June 30, 2024, a reduction of about 11%[17]. - As of June 30, 2024, the company's stockholders' equity was approximately $26.2 million, meeting the Nasdaq listing requirement of $2.5 million[176]. Research and Development - The company expects to incur substantial research and development costs to develop and commercialize new products, which may significantly affect profitability[13]. Internal Controls and Governance - The company identified material weaknesses in internal controls over financial reporting, primarily due to insufficient personnel with appropriate accounting knowledge[192]. - Management is implementing a remediation plan to address material weaknesses, including hiring additional accounting personnel and improving internal controls[193][194]. - The company has made corporate governance changes, including the appointment of a representative from the Purchaser to the board of directors, to improve operational and financial performance[169]. Market and Future Outlook - The company anticipates that its actual results may differ materially from forward-looking statements due to various risks and uncertainties[110]. - The company may issue equity or equity-linked securities to current or potential customers to further business relationships, which could lead to significant dilution for existing stockholders[162].

Financial Results - MultiSensor AI Holdings, Inc. reported its financial results for Q1 2024 on May 16, 2024[4] - Specific financial figures for Q1 2024 compared to the same period last year were not disclosed in the provided content[4] Key Performance Indicators - The company highlighted its annual recurring revenue as a key performance indicator, emphasizing its importance in measuring operational performance[5]

Financial Performance - Revenue for the three months ended March 31, 2024, was $2,275,000, representing a 132% increase compared to $980,000 for the same period in 2023[27] - Operating loss for Q1 2024 was $2,565,000, an improvement from a loss of $3,176,000 in Q1 2023[27] - Net loss for the three months ended March 31, 2024, was $3,922,000, compared to a net loss of $2,907,000 in the same period last year[27] - The company reported a basic net loss per share of $(0.33) for Q1 2024, compared to $(5.65) for Q1 2023[27] - The company reported net losses and negative cash flows from operations, raising substantial doubt about its ability to continue as a going concern[48][49] - The company incurred a net loss of $3.9 million for Q1 2024, compared to a net loss of $2.9 million in Q1 2023, indicating ongoing financial challenges[214] Assets and Liabilities - Total current assets decreased to $9,093,000 as of March 31, 2024, down from $12,513,000 as of December 31, 2023[26] - Total liabilities decreased to $12,752,000 as of March 31, 2024, from $16,640,000 as of December 31, 2023[26] - Cash and cash equivalents at the end of Q1 2024 were $491,000, down from $1,155,000 at the end of 2023[26] - Trade accounts receivable decreased to $677,000 as of March 31, 2024, from $2,440,000 as of December 31, 2023[26] - Contract liabilities decreased to $1,154 as of March 31, 2024, from $2,065 at the beginning of the year[66] - As of March 31, 2024, the company's stockholders' equity was approximately $3.5 million, meeting the Nasdaq listing requirement of $2.5 million[189] Revenue Composition - Product sales accounted for $2,022 of total revenue in Q1 2024, up from $755 in Q1 2023, indicating a 167% increase[65] - Two customers accounted for 23% and 20% of total net revenue for the three months ended March 31, 2024, highlighting customer concentration risks[59] Expenses - Cost of goods sold for the three months ended March 31, 2024, was approximately $1.4 million, an increase of $0.9 million, or 202%, from approximately $0.5 million for the same period in 2023[163] - Gross margin for the three months ended March 31, 2024, was approximately 38%, a decrease from approximately 53% for the same period in 2023[164] - Selling, general and administrative expenses for the three months ended March 31, 2024, were approximately $3.2 million, a decrease of $0.3 million, or 10%, from approximately $3.5 million for the same period in 2023[165] - Depreciation expense for the three months ended March 31, 2024, was approximately $0.3 million, an increase of $0.1 million, or 52%, from approximately $0.2 million for the same period in 2023[166] - Interest expense for the three months ended March 31, 2024, was approximately $0.04 million, a decrease of $0.05 million, or 92%, from approximately $0.05 million for the same period in 2023[167] Financing Activities - The Company entered into a line of credit agreement with B1 Bank providing a revolving credit commitment of $3,000, with a maturity date of January 22, 2024[71] - As of March 31, 2024, there was no outstanding debt balance, and the Company repaid a total of $900 borrowed under the line of credit in December 2023[73][72] - The Company issued Financing Notes totaling $6,805 on December 19, 2023, as part of a Business Combination, with a maturity date set for three years after the closing[87][88] - The Company converted $4.5 million of Financing Notes into common stock at a price of $5 per share, resulting in a loss of $0.9 million recorded under loss on financing transaction[138] - The company issued 327,500 shares of common stock related to the principal balance of the Financing Notes, along with 327,500 Inducement Shares, totaling 663,318 shares issued[139] Future Outlook and Plans - The company plans to raise additional liquidity and reduce operating expenses in response to financial challenges, although these plans are subject to market conditions[49] - The company is focused on expanding its multi-sensor systems for industrial applications, including cloud-based software and services[34] - The company is committed to expanding its SaaS capabilities, which will require significant investment and is subject to uncertainties regarding customer demand and operational scalability[220] - The company has a limited operating history in providing SaaS solutions, which complicates the evaluation of future prospects and associated risks[221] Tax and Compliance - The company's provision for income taxes was a $31 tax expense for Q1 2024, compared to a $15 tax benefit for Q1 2023, with effective tax rates of (0.78)% and (7.97)% respectively, both below the U.S. statutory tax rate of 21%[111] - The company maintains a valuation allowance on its deferred tax assets until sufficient evidence supports the reversal of this allowance[111] - The company experienced an ownership change as defined under Internal Revenue Code Section 382, subjecting tax attributes to an annual limitation[112] Internal Controls and Governance - The company plans to hire additional accounting personnel to address material weaknesses in internal controls over financial reporting identified in previous audits[207] - The company has not identified any material claims or legal actions as of March 31, 2024, that would adversely affect its financial position[109] - The company is classified as an emerging growth company, allowing it to delay the adoption of new accounting standards until they apply to private companies[199]

Financial Performance - The company incurred a net loss of $22.3 million for the year ended December 31, 2023, following a net loss of $13.3 million for the year ended December 31, 2022[117]. - The company has experienced recurring net losses, negative cash flows from operations, and negative net working capital, raising substantial doubt about its ability to continue as a going concern for a period of 12 months[202]. - The company recorded an inventory write-down of $1.7 million for products not expected to be sold within one year based on customer demand and current market conditions[219]. - Significant increases in prices for certain electronic components have been experienced, impacting profitability[189]. - Revenue from U.S. government contracts accounted for approximately 2.5% and 5.2% of total revenue for the years ended December 31, 2023 and 2022, respectively[184]. Growth Strategy - The company plans to expand its sales and marketing presence, increase investment in SaaS solutions, and pursue strategic acquisitions to drive growth[121]. - The company’s future growth depends on successfully introducing new products and achieving market acceptance, which is uncertain[139]. - The company must effectively grow its sales and marketing organization to increase revenue, facing challenges in attracting skilled personnel[166]. - The company may continue to incur significant losses as it invests in initiatives before realizing any incremental revenue growth[118]. - The company requires additional capital to execute its business plan, which may not be available on favorable terms, potentially limiting growth opportunities[162]. Market and Competitive Risks - The company faces challenges in maintaining competitive average selling prices and high sales volumes, which could adversely affect revenue and gross margins[122]. - The competitive landscape includes competitors with greater resources, which may lead to pricing pressure and reduced margins for the company[155]. - The company generates revenue from industries subject to significant volatility, such as oil and gas, which can affect demand for its products[177]. - Significant developments in alternative technologies could impact demand for the company's products, potentially resulting in decreased revenue and loss of market share[150]. - The company faces risks related to sales through distributors, including concentration risk and credit risk, which could harm revenue if key distributors are lost[147]. Operational Challenges - The company has a limited operating history providing SaaS solutions, making it difficult to evaluate future prospects and risks[125]. - The company is reliant on artificial intelligence and machine learning models for product development, which poses risks if the models are inadequately designed or trained[146]. - The reliance on contract manufacturers may lead to quality control issues and disruptions in supply, adversely affecting the ability to fulfill orders and impacting operating results[153]. - The complexity of manufacturing processes may lead to low product yields, increasing costs and reducing available supply[165]. - The company faces risks related to the timely introduction of new products and technologies, which are critical for competitiveness[181]. Customer Relationships - The company’s relationships with existing customers are limited, and it must build confidence to secure long-term agreements[128]. - The sales cycle for new customers can exceed one year, leading to potential cancellations or postponements that may adversely affect financial results[148]. - The company may not be able to maintain relationships with large customers, which could materially affect financial results[176]. - The company is exposed to credit risk on trade accounts receivable, which could adversely affect business if major customers face financial difficulties[178]. Legal and Regulatory Risks - The company identified material weaknesses in its internal controls over financial reporting, which could adversely affect its operating results and compliance with regulations[211]. - The company is subject to potential audits of its income, sales, and other transaction taxes, which could adversely affect its financial condition and results of operations[225]. - The company may face litigation risks related to the alleged wrongful use of trade secrets from former employees[248]. - The company could incur substantial legal liabilities and expenses in defending against lawsuits, which may require significant management resources[315]. - There is no assurance that ongoing or future claims will not materially impact operating results or financial position[315]. Intellectual Property Risks - The company faces challenges in protecting its intellectual property, as competitors may design around issued patents or claim infringement, which could adversely affect its business[232]. - The company relies on trade secret protections and patent laws to safeguard its technology, but these provide only limited protections[241]. - There is uncertainty regarding the success of pending patent and trademark applications, which may not provide adequate defensive protection[242]. - The company faces risks related to unauthorized use of its intellectual property, which could lead to loss of competitive advantage and revenue[244]. Environmental and Compliance Risks - The company faces increasing environmental regulations that could adversely affect its operations and financial condition[268]. - The U.S. Environmental Protection Agency's efforts to limit greenhouse gas emissions may increase operational costs and affect product design[270]. - Legislative measures addressing climate change could lead to higher capital expenditures and compliance costs for the company[271]. - Compliance with various state laws regarding sales tax and income tax is critical, as non-compliance could result in unexpected costs and penalties[250]. Management and Governance - The company is currently a controlled company, with the CEO owning approximately 51% of outstanding common stock, which may limit stockholder protections[273]. - The company’s success depends on the continued service of key members of its senior management team, and the loss of any member could harm its business[302]. - The company may face challenges in recruiting and retaining qualified personnel, which is critical for executing its strategic plan[303]. Market Conditions and Stock Performance - Nasdaq has commenced delisting procedures for the company's securities due to non-compliance with listing requirements, including a minimum market value of $50 million[276]. - The trading price and volume of the company's securities may fluctuate dramatically due to various factors, including market conditions and investor interest[282]. - The future exercise of registration rights may adversely affect the market price of common stock due to the potential increase in the number of securities available for trading[290]. - The issuance of additional shares or other equity securities could dilute existing ownership interests and may depress the market price of common stock[292].

Table of Contents 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 September 30, 2023 ☐ 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. 001-40916 SPORTSMAP TECH ACQUISITION CORP. (Exact name of registrant as specified in its charter) (State or other ju ...

Table of Contents 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 June 30, 2023 ☐ 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. 001-40916 SPORTSMAP TECH ACQUISITION CORP. (Exact name of registrant as specified in its charter) (State or other jurisdi ...

Table of Contents 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, 2023 ☐ 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. 001-40916 SPORTSMAP TECH ACQUISITION CORP. (Exact name of registrant as specified in its charter) (State or other jurisd ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF For the transition period from to Commission File Number: 001-40916 SPORTSMAP TECH ACQUISITION CORP. (Exact name of registrant as specified in its charter) (State or Other Jurisdiction of Inco ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) For the transition period from to Commission File No. 001-40916 SPORTSMAP TECH ACQUISITION CORP. (Exact name of registrant as specified in its charter) Delaware 86-3938682 (I.R.S. Employer (State or other jurisdiction of incorporation or organization) 5353 WEST ALABAMA, SUITE 415 HOUSTON, TEXAS 77056 (Address of Principal Executive Offices, including zip code) ☒ QUARTERLY REPORT PURSUANT TO SECTION ...