The Glimpse (VRAR) - 2025 Q3 - Quarterly Report

PART I - FINANCIAL INFORMATION Financial Statements (Unaudited) The unaudited condensed consolidated financial statements for the period ended March 31, 2025, show a significant increase in cash and cash equivalents to $7.06 million, primarily due to financing activities Condensed Consolidated Balance Sheets As of March 31, 2025, total assets increased to $20.2 million from $15.6 million, driven by a rise in cash and cash equivalents from $1.8 million to $7.1 million, while total liabilities decreased, leading to increased stockholders' equity Condensed Consolidated Balance Sheet Highlights (in USD) | Balance Sheet Item | March 31, 2025 (Unaudited) | June 30, 2024 (Audited) | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $7,058,020 | $1,848,295 | | Total current assets | $8,988,564 | $3,520,289 | | Goodwill | $10,857,600 | $10,857,600 | | Total assets | $20,244,730 | $15,558,603 | | Liabilities & Equity | | | | Total current liabilities | $3,497,372 | $2,427,598 | | Total liabilities | $3,516,823 | $4,020,118 | | Total stockholders' equity | $16,727,907 | $11,538,485 | | Total liabilities and stockholders' equity | $20,244,730 | $15,558,603 | Condensed Consolidated Statements of Operations For the three months ended March 31, 2025, revenue decreased to $1.42 million with a net loss of $1.50 million, while the nine-month revenue remained flat at $7.03 million with a slight increase in net loss to $2.49 million Operating Results (in USD) | Metric | Q3 FY2025 (3 months ended Mar 31, 2025) | Q3 FY2024 (3 months ended Mar 31, 2024) | Nine Months FY2025 (ended Mar 31, 2025) | Nine Months FY2024 (ended Mar 31, 2024) | | :--- | :--- | :--- | :--- | :--- | | Total Revenue | $1,422,235 | $1,895,643 | $7,029,538 | $7,076,948 | | Software services | $1,283,287 | $1,466,397 | $6,641,652 | $6,510,740 | | Software license/SaaS | $138,948 | $429,246 | $387,886 | $566,208 | | Gross Profit | $1,020,026 | $1,326,182 | $4,968,019 | $4,670,469 | | Loss from operations | ($1,584,663) | ($1,603,307) | ($2,610,208) | ($2,586,600) | | Net Loss | ($1,502,202) | ($1,542,256) | ($2,490,522) | ($2,400,066) | | Basic and Diluted EPS | ($0.07) | ($0.09) | ($0.13) | ($0.15) | Condensed Consolidated Statements of Cash Flows For the nine months ended March 31, 2025, net cash used in operating activities significantly improved to ($0.13 million), with net cash provided by financing activities of $6.88 million, resulting in a $5.21 million net increase in cash Cash Flow Summary (Nine Months Ended March 31, in USD) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | ($126,134) | ($4,282,895) | | Net cash used in investing activities | ($1,541,453) | ($19,346) | | Net cash provided by financing activities | $6,877,312 | $2,968,501 | | Net change in cash and cash equivalents | $5,209,725 | ($1,333,740) | | Cash and cash equivalents, end of period | $7,058,020 | $4,285,343 | Notes to Condensed Consolidated Financial Statements The notes detail the company's immersive technology business, liquidity, accounting policies, and significant events including subsidiary divestitures and a $6.79 million financing agreement - The company is an Immersive technology company providing Virtual Reality (VR), Augmented Reality (AR), and Spatial Computing software and services[27] - In December 2024 and January 2025, the company raised approximately $6.79 million in net cash proceeds from a Securities Purchase Agreement (SPA)[29][30] - Effective October 1, 2024, the company divested its subsidiary QReal and Glimpse Turkey in a management buyout, retaining revenue from QReal's largest customer up to a $1.35 million milestone[71][73] - As of March 31, 2025, the company had approximately $3.34 million in unfulfilled performance obligations on executed contracts[65] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's strategic shift to 'Spatial Core' technologies, stable revenue, decreased operating expenses, and improved liquidity driven by a $6.79 million financing, leading to a reduced Adjusted EBITDA loss Overview The company operates as an enterprise-focused Immersive technology provider, initiating a strategic shift in fiscal year 2024 to prioritize 'Spatial Core' solutions integrating Spatial Computing, Cloud, and AI - The company is an Immersive technology company focused on enterprise VR, AR, and Spatial Computing software and services[143] - A strategic shift in FY2024 focuses the business on 'Spatial Core' solutions, integrating Spatial Computing, Cloud, and Artificial Intelligence (AI)[146] Results of Operations For the nine months ended March 31, 2025, total revenue was flat at $7.03 million, gross profit increased by 6% to $4.97 million with a 71% gross margin, and operating expenses decreased by 30% (excluding impairments and fair value changes) Revenue by Category (Nine Months Ended March 31, in millions USD) | Category | 2025 | 2024 | Change $ | Change % | | :--- | :--- | :--- | :--- | :--- | | Software Services | $6.64 | $6.51 | $0.13 | 2% | | Software License/SaaS | $0.39 | $0.57 | ($0.18) | -32% | | Total Revenue | $7.03 | $7.08 | ($0.05) | -1% | - Gross profit margin for the nine months ended March 31, 2025, increased to 71% from 66% in the prior year, reflecting a revenue mix with less third-party costs[159] - Operating expenses, excluding impairments and fair value changes, decreased by 30% for the nine months ended March 31, 2025, compared to the prior year, reflecting the strategic shift and divestitures[160][161] - Customer concentration remains high, with two customers accounting for 58% of total gross revenues during the nine months ended March 31, 2025[158] Non-GAAP Financial Measures The company uses Adjusted EBITDA to evaluate core operating performance, with the loss significantly improving to $1.22 million for the nine months ended March 31, 2025, from $3.50 million in the prior year Reconciliation of Net Loss to Adjusted EBITDA (in millions USD) | Metric | Nine Months Ended Mar 31, 2025 | Nine Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Net loss | $(2.49) | $(2.40) | | Depreciation and amortization | $0.39 | $1.04 | | EBITDA loss | $(2.10) | $(1.36) | | Stock based compensation expenses | $0.71 | $1.83 | | Loss on subsidiary divestiture | $0.11 | - | | Non cash change in fair value of acquisition contingent consideration | $0.09 | $(4.32) | | Intangible asset and goodwill impairment | - | $0.90 | | Adjusted EBITDA loss | $(1.22) | $(3.50) | Liquidity and Capital Resources As of March 31, 2025, cash and cash equivalents increased to $7.06 million, driven by $6.88 million from financing activities, with net cash used in operating activities improving by 97% to ($0.13 million) - Cash and cash equivalents stood at $7.06 million as of March 31, 2025[179] - Net cash used in operating activities for the nine months ended March 31, 2025, improved by 97% to ($0.13 million) from ($4.28 million) in the prior-year period[175][176] - The company raised approximately $6.88 million from financing activities during the nine months ended March 31, 2025[178] - As of March 31, 2025, the company had no outstanding debt obligations[180] Quantitative and Qualitative Disclosures about Market Risk This disclosure is not required for smaller reporting companies - Not required for smaller reporting companies[183] Controls and Procedures Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of March 31, 2025, with no material changes in internal control over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[185] - There were no changes in internal control over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, internal controls[187] PART II - OTHER INFORMATION Legal Proceedings The company reported no legal proceedings - None[189] Risk Factors There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the fiscal year ended June 30, 2024 - There have been no material changes to the risks described in the Annual Report on Form 10-K for the fiscal year ended June 30, 2024[190] Unregistered Sales of Equity Securities and Use of Proceeds During the three months ended March 31, 2025, the company issued 11,750 shares of common stock for compensation and vendor expenses, valued at $29,023, exempt from registration under Section 4(a)(2) of the Securities Act - During the three months ended March 31, 2025, the Company issued 11,750 shares of common stock for compensation and vendor expenses with a value of $29,023[191] Exhibits The report includes several exhibits, primarily certifications from the Principal Executive Officer and Principal Financial Officer as required by the Exchange Act, and Inline XBRL documents - Filed exhibits include CEO and CFO certifications (31.1, 31.2, 32.1) and Inline XBRL data files (101 series)[197]