Revenue Performance - Cloud Telecommunications service revenue increased 16% or $487,000 to $3,469,000 for the three months ended June 30, 2020 compared to $2,982,000 for the same period in 2019[137]. - Total revenue for the three months ended June 30, 2020 was $4,054,000, an increase of 12% or $440,000 from $3,614,000 for the same period in 2019[147]. - Net income for the three months ended June 30, 2020 was $508,000, up 50% from $338,000 for the same period in 2019[147]. - For the six months ended June 30, 2020, service revenue increased 15% or $938,000 to $7,093,000 compared to $6,155,000 for the same period in 2019[152]. - Non-GAAP net income for Q2 2020 was $660,000, a 47% increase from $447,000 in Q2 2019[163]. - Total revenue for the Cloud Telecommunications segment was $3,918,000 in Q2 2020, up from $3,449,000 in Q2 2019, representing a 14% increase[168]. - Service revenue for Cloud Telecommunications increased 17% or $989,000, to $6,801,000 for the six months ended June 30, 2020 compared to $5,812,000 for the same period in 2019[179]. Product Revenue - Cloud Telecommunications product revenue decreased 4% or $18,000 to $449,000 for the three months ended June 30, 2020 compared to $467,000 for the same period in 2019[137]. - Product revenue for the six months ended June 30, 2020 decreased 13% or $123,000 to $828,000 compared to $951,000 for the same period in 2019[154]. - Product revenue decreased by 4% or $18,000 to $449,000 for Q2 2020, influenced by the timing of installations[170]. Backlog and Future Prospects - As of June 30, 2020, the backlog was $27,349,000, an increase from $24,772,000 as of June 30, 2019[137]. - Backlog increased by 10% or $2,577,000 to $27,349,000 as of June 30, 2020, compared to $24,772,000 as of June 30, 2019[172]. - Backlog increased 10% or $2,577,000 to $27,349,000 as of June 30, 2020 compared to $24,772,000 as of June 30, 2019[181]. Expenses - Research and development expenses rose by 26% or $49,000 to $236,000 for Q2 2020, driven by increased costs for customer interface maintenance and mobile application development[174]. - Selling and marketing expenses increased by 10% or $99,000 to $1,062,000 for Q2 2020, primarily due to higher salaries and commissions[175]. - General and administrative expenses increased 11% or $209,000, to $2,105,000 for the six months ended June 30, 2020 compared to $1,896,000 for the same period in 2019[187]. - Research and development expenses increased 27% or $105,000, to $498,000 for the six months ended June 30, 2020 compared to $393,000 for the same period in 2019[185]. - Selling and marketing expenses increased 13% or $238,000, to $2,100,000 for the six months ended June 30, 2020 compared to $1,862,000 for the same period in 2019[186]. Cost of Service Revenue - Cost of service revenue increased by 3% or $22,000 to $883,000 for Q2 2020, attributed to higher salaries and bandwidth costs[172]. - Cost of service revenue increased 7% or $124,000, to $1,828,000 for the six months ended June 30, 2020 compared to $1,704,000 for the same period in 2019[183]. - Cost of service revenue for Web Services increased 92% or $12,000, to $25,000 for the three months ended June 30, 2020 compared to $13,000 for the same period in 2019[192]. - Cost of service revenue increased by 6% or $3,000, to $50,000 for the six months ended June 30, 2020, primarily due to increased customer service salaries and benefits[199]. Financial Position - Working capital increased by 29% or $813,000, to $3,658,000 as of June 30, 2020, compared to $2,845,000 at December 31, 2019[205]. - Cash, cash equivalents, and restricted cash increased by 19% or $809,000, to $5,089,000 at June 30, 2020, compared to $4,280,000 at December 31, 2019[206]. - Total stockholders' equity increased by 32% or $1,387,000, to $5,774,000 as of June 30, 2020, compared to $4,387,000 at December 31, 2019[218]. - Notes payable increased to $2,979,000 at June 30, 2020, compared to $0 at December 31, 2019, due to financing for the corporate office building purchase and a Paycheck Protection Program loan[213]. - Inventories increased by 17% or $66,000, to $448,000 at June 30, 2020, compared to $382,000 at December 31, 2019[207]. - Prepaid expenses increased by 128% or $181,000, to $322,000 at June 30, 2020, compared to $141,000 at December 31, 2019[208]. Other Income and Expenses - Income before income taxes increased 49% or $169,000 to $511,000 for the three months ended June 30, 2020 compared to $342,000 for the same period in 2019[150]. - Net other expense increased 575% or $23,000, to $27,000 for the six months ended June 30, 2020 compared to $4,000 for the same period in 2019[189]. - Net other income decreased by 543% or $38,000, to $(31,000) for the six months ended June 30, 2020, due to increased foreign exchange losses[202]. Web Services Performance - Web Services revenue decreased 18% or $29,000 to $136,000 for the three months ended June 30, 2020 compared to $165,000 for the same period in 2019[138]. - Service revenue decreased by 15% or $51,000, to $292,000 for the six months ended June 30, 2020, compared to $343,000 for the same period in 2019[198].
Crexendo(CXDO) - 2020 Q2 - Quarterly Report