FOXO Technologies (FOXO) - 2024 Q2 - Quarterly Report

Financial Performance - Total revenues for the three months ended June 30, 2024, were $28,000, compared to $12,000 for the same period in 2023, representing a 133% increase, with the acquisition of Myrtle contributing $20,000 to the increase [165]. - Net loss attributable to FOXO for the three months ended June 30, 2024, was $2,163,000, a reduction of 81% from $11,293,000 in the same period in 2023 [165]. - Net revenues for the six months ended June 30, 2024, were $35, a 40% increase from $25 in the same period of 2023, with the acquisition of Myrtle contributing $20 to the increase [177]. - Net loss attributable to common stockholders was $4,633 for the six months ended June 30, 2024, compared to $21,398 for the same period in 2023, marking a significant improvement of 78% [182]. - Net loss for the six months ended June 30, 2024, was $4,633 thousand, significantly reduced from $21,398 thousand in the same period of 2023 [190]. Expenses - Direct costs of revenues were $31,000 for the three months ended June 30, 2024, compared to no direct costs for the same period in 2023, attributed to the acquisition of Myrtle [166]. - Research and development expenses decreased by 69% to $104,000 for the three months ended June 30, 2024, down from $333,000 in the same period in 2023 [165]. - Total operating expenses decreased by 79% to $1,617,000 for the three months ended June 30, 2024, compared to $7,617,000 in the same period in 2023 [165]. - Selling, general and administrative expenses fell to $1,474 for Q2 2024, down 63% from $4,003 in Q2 2023, primarily due to the completion of a consulting agreement and headcount reductions [170]. - Research and development expenses for the six months ended June 30, 2024, were $269, down 58% from $642 in the same period of 2023, due to lower employee-related expenses [178]. - Selling, general and administrative expenses for the six months ended June 30, 2024, were $2,462, a decrease of 76% from $10,335 in the same period of 2023 [180]. Cash Flow and Financing - Cash and cash equivalents as of June 30, 2024, were $33 thousand, down from $38 thousand as of December 31, 2023 [190]. - Net cash provided by operating activities in the six months ended June 30, 2024, was $551 thousand, compared to cash used of $(5,300) thousand in the same period of 2023, marking an improvement of $5,851 thousand [204]. - Cash used in investing activities for the six months ended June 30, 2024, was $(2,381) thousand, primarily for acquiring an epigenetic software APP and the purchase of Myrtle [206]. - Net cash provided by financing activities in the six months ended June 30, 2024, was $1,825 thousand from the issuance of promissory notes [207]. - The company has a working capital deficit of $20,817 thousand and a total stockholders' deficit of $16,167 thousand as of June 30, 2024 [190]. Operational Strategy - FOXO has paused sales of new life insurance products to conserve cash resources and focus on FOXO Labs [151]. - The company entered into a Letter Agreement with KR8 to develop a Direct-to-Consumer APP utilizing AI technology for epigenetic biomarker applications [153]. - The acquisition of Myrtle on June 14, 2024, marks the company's entry into the healthcare sector, offering behavioral health services including substance abuse treatment [157]. - The company is focusing on commercializing proprietary epigenetic biomarker technology for underwriting risk classification in the life insurance industry [158]. - The company expects to continue incurring operating losses until it achieves adequate scale and secures additional capital [191]. Compliance and Investigations - The company received a notice of noncompliance from NYSE due to a stockholders' deficit of $14.9 million as of March 31, 2024 [220]. - The company has not fully remediated material weaknesses in its internal controls as of the filing date of this report [226]. - The SEC conducted an investigation regarding the termination of Jon Sabes as CEO and Steven Sabes as COO, and the company is voluntarily responding to the SEC's request [230]. - On July 9, 2024, the SEC concluded its investigation and does not intend to recommend enforcement action against the company based on the information available at that time [230].