CXApp (CXAI)2024-08-12 20:20Revenue Performance - Revenue for the three months ended June 30, 2024, was $1,766 thousand, a decrease of $149 thousand (approximately 7.8%) compared to $1,915 thousand for the same period in 2023[156]. - Revenue for the six months ended June 30, 2024, was $3,584 thousand, an increase from $2,257 thousand for the same period in 2023, reflecting a growth of $1,327 thousand (approximately 58.7%)[164]. Subscription Revenue - Subscription-based revenue accounted for 85% of total revenue for the three months ended June 30, 2024, up from 79% in the same period of 2023, indicating a 6% increase in the revenue mix[156]. - Subscription-based revenue for the six months ended June 30, 2024, was 86% of total revenue, up from 78% in the same period of 2023, indicating an 8% increase in the revenue mix[165]. Profitability and Loss - Gross profit margin improved to 80% for the three months ended June 30, 2024, compared to 75% for the same period in 2023[157]. - Net loss for the three months ended June 30, 2024, was $5,256 thousand, compared to a net loss of $14,730 thousand for the same period in 2023, representing an improvement of $9,474 thousand (approximately 64.3%)[154]. - Gross profit margin increased to 81% for the six months ended June 30, 2024, compared to 75% for the same period in 2023, reflecting a decrease in cost of revenues by approximately $370 thousand, or 35%[166]. - The company reported a net loss of approximately $10,426 thousand for the six months ended June 30, 2024, compared to a net loss of $11,972 thousand for the same period in 2023[182]. Operating Expenses - Operating expenses decreased to $5,063 thousand for the three months ended June 30, 2024, down from $5,118 thousand in the same period of 2023, reflecting a reduction of $55 thousand (approximately 1.1%)[159]. - Operating expenses rose to $10,141 thousand for the six months ended June 30, 2024, up from $5,860 thousand in the same period of 2023, primarily due to increased research and development costs[167]. Other Expenses - Other expenses significantly decreased to $1,765 thousand for the three months ended June 30, 2024, from $12,028 thousand in the same period of 2023, a reduction of $10,263 thousand (approximately 85.3%)[160]. - Other expenses decreased by $6,787 thousand for the six months ended June 30, 2024, attributed to a reduction in changes in fair value of derivative warrant liabilities by $7,831 thousand[168]. Tax Benefits - The company reported an income tax benefit of $159 thousand for the three months ended June 30, 2024, compared to $981 thousand for the same period in 2023[161]. - The company reported an income tax benefit of approximately $366 thousand for the six months ended June 30, 2024, down from a benefit of $2,541 thousand in the same period of 2023[169]. Cash Flow and Liquidity - As of June 30, 2024, the company had a working capital deficiency of approximately $6,807 thousand and cash of approximately $6,160 thousand[180]. - Net cash used in operating activities was $2,560 thousand for the six months ended June 30, 2024, compared to $6,598 thousand for the same period in 2023[179]. - The company believes its current liquidity position, including cash raised under the promissory note of $3,000 thousand, can mitigate going concern indicators for at least one year[181]. - Net cash flows used in investing activities for the six months ended June 30, 2024, was approximately $26 thousand, a decrease from $9,977 thousand in the prior period[184]. - Net cash flows provided by financing activities during the six months ended June 30, 2024, was approximately $2,480 thousand, compared to $328 thousand and $8,892 thousand in the previous periods[185]. Business Combination - The company completed a Business Combination on March 14, 2023, valued at $69,928 thousand, which included the transfer of the Enterprise Apps Business from Inpixon[148]. Securities and Agreements - The company entered into a Securities Purchase Agreement to raise up to $10,000 thousand in shares of common stock, with an initial principal amount of $2,650 thousand received[179]. - The Company entered into a Securities Purchase Agreement on May 22, 2024, to sell up to $10,000 thousand in shares of Common Stock[185]. - The Company received net proceeds of $2,480 thousand from a convertible Pre-Paid Purchase on June 3, 2024[185]. Lease Obligations - Total obligation for operating leases as of June 30, 2024, is approximately $677 thousand, with $389 thousand expected to be paid in the next twelve months[187]. Accounting and Estimates - The Company has not engaged in off-balance sheet guarantees or trading activities involving non-exchange traded contracts[186]. - The Company has elected to take advantage of the extended transition period for complying with new accounting standards as an emerging growth company[192]. - Management believes there have been no significant changes to critical accounting estimates during the six months ended June 30, 2024[190].