Financial Performance - Total revenue for Q2 2024 was $7,162,000, representing a 53.4% increase from $4,675,000 in Q2 2023[17] - Operating income for Q2 2024 was $1,992,000, compared to an operating income of $931,000 in Q2 2023[17] - Net income for Q2 2024 was $6,561,000, a significant recovery from a net loss of $7,262,000 in Q2 2023[17] - Revenue for the three months ended June 30, 2024, totaled $7.2 million, an increase of 53% compared to $4.7 million for the same period in 2023[78] - Net income for the three months ended June 30, 2024, was $6.6 million, compared to a net loss of $7.3 million for the same period in 2023[79] - Total revenue for the six months ended June 30, 2024, was $12.9 million, an increase of 53% compared to $8.5 million for the same period in 2023[78] - Net income for the six months ended June 30, 2024, was $2.0 million, compared to a net loss of $20.4 million for the same period in 2023[80] Assets and Liabilities - Total current assets decreased to $8,724,000 as of June 30, 2024, down from $9,784,000 at the end of 2023[12] - Current liabilities decreased to $59,965,000 from $64,755,000 at the end of 2023, indicating improved financial stability[12] - Total assets decreased to $21,013,000 as of June 30, 2024, down from $22,416,000 at the end of 2023[12] - Stockholders' deficit improved to $(39,606,000) as of June 30, 2024, compared to $(43,178,000) at the end of 2023[14] - Cash and cash equivalents increased to $2,460,000 from $1,797,000 at the end of 2023, indicating better liquidity[12] Cash Flow and Financing - The company reported a net cash provided by operating activities of $432,000 for the six months ended June 30, 2024, compared to a net cash used of $1,215,000 in the same period of 2023[25] - Cash at the end of the period increased to $2,460,000 from $1,182,000 at the beginning of the period, representing a net change in cash of $663,000[25] - The company plans to obtain additional capital through various means, including the conversion of outstanding warrants and issuance of common stock[33] - The company has raised concerns regarding its ability to continue as a going concern due to recurring losses and dependency on future financing[31] - The company terminated the Merger Agreement on June 25, 2024, which may impact its future capital raising efforts[44] Expenses and Margins - Gross margin improved to $5,240,000 in Q2 2024, up from $3,473,000 in Q2 2023, reflecting a gross margin percentage increase from 74.3% to 73.2%[17] - General and administrative expenses increased by $0.6 million, or 49%, for the three months ended June 30, 2024, primarily due to increased headcount expenses[92] - Research and development expenses increased by $0.1 million, or 40%, for the three months ended June 30, 2024, remaining at 3% of revenue[94] - Gross margin for the three months ended June 30, 2024, was 73%, a slight decrease from 74% in the same period of 2023[90] Shareholder Information - As of June 30, 2024, the total number of shares issued and outstanding increased to 1,181,272,961 from 1,140,559,527 as of December 31, 2023, reflecting an increase of approximately 3.6%[22] - Basic net income per share for the three months ended June 30, 2024, was $0.01, while diluted net income per share was $0.00, compared to a basic loss per share of $(0.01) and diluted loss per share of $(0.01) for the same period in 2023[46] - Total shares used for calculating basic income per share increased to 1,182,598 for the three months ended June 30, 2024, from 582,329 in the same period of 2023[46] Internal Controls and Compliance - The company has identified three material weaknesses in internal control over financial reporting as of June 30, 2024, which could lead to material misstatements in financial statements[109] - Management has hired a third-party consultant to enhance internal controls and perform a risk assessment over financial reporting processes[112] - The company plans to remediate identified material weaknesses throughout 2024, including hiring additional resources and redesigning accounting and IT processes[112] - The company lacks expertise in applying U.S. GAAP to complex transactions, which contributes to the identified material weaknesses[111] - The existence of material weaknesses requires significant time and expense for remediation, potentially affecting the company's financial statements and shareholder confidence[114] Legal and Regulatory Matters - The company has disclosed ongoing legal proceedings, which may impact its financial condition[117] - The company is exploring alternative options to seek an uplisting to a national exchange after terminating the Merger Agreement on June 25, 2024[82]
SANUWAVE Health Inc(SNWV) - 2024 Q2 - Quarterly Report