Intellinetics(INLX) - 2019 Q3 - Quarterly Report

Revenue Performance - Total revenues for the three months ended September 30, 2019, were $755,568, representing a 12% increase from $673,111 in 2018[142] - For the nine months ended September 30, 2019, revenues were $1,911,561, reflecting a year-over-year growth of 9%[143] - Revenues from software as a service (SaaS) for the three months ended September 30, 2019, were $214,237, a 23% increase from $173,515 in 2018[146] - Software maintenance support revenue for the nine months ended September 30, 2019, was $753,692, an increase of 2% from $740,527 in 2018[147] - Professional services revenues for the three months ended September 30, 2019, were $116,696, a 104% increase from $57,294 in 2018[148] Cost and Margin Analysis - Gross margin for the three months ended September 30, 2019, improved to 80% from 61% in 2018[151] - Cost of revenues for the three months ended September 30, 2019, decreased by 44% to $147,690 from $261,758 in 2018[150] Net Loss and Financial Position - The company reported a net loss of $1,542,268 for the nine months ended September 30, 2019, with a basic and diluted net loss per share of $0.08[143] - As of September 30, 2019, the company had $303,080 in cash and a net working capital deficit of $456,104[157] - The company expects that capital requirements will exceed cash flows generated from operations over the next 12 months, indicating potential liquidity challenges[158] Operating and Investing Activities - Net cash used in operating activities was $745,439 for the nine months ended September 30, 2019, compared to $923,737 for the same period in 2018[166] - Net cash used in investing activities amounted to $5,489 for the nine months ended September 30, 2019, compared to $3,410 for the same period in 2018[167] Expenses Overview - General and administrative expenses increased by $64,593, or 14%, to $510,817 for the three months ended September 30, 2019, compared to $466,224 for the same period in 2018[153] - Sales and marketing expenses rose by $12,783, or 5%, to $248,757 for the three months ended September 30, 2019, compared to $235,974 for the same period in 2018[154] - Interest expense, net increased by $38,514, or 19%, to $245,156 for the three months ended September 30, 2019, compared to $206,642 for the same period in 2018[156] Future Plans and Capital - The company anticipates that the provision of SaaS-based customer activation will increase over time, with SaaS revenues accounting for 34% of total revenue for the nine months ended September 30, 2019, up from 30% in 2018[138] - The company plans to increase sales and market share through targeted marketing and an expanded reseller network, although additional capital will be required[165] - The company raised a total of $12,683,494 through debt and equity securities from 2012 to 2018[159] Employee Count - The number of employees as of September 30, 2019, was 17[143] - As of November 12, 2019, the company had 18,524,878 shares of common stock issued and outstanding[160]