Financial Performance - Revenues for the three months ended March 31, 2025, were $6,927,469, representing an increase of 20.2% compared to $5,764,074 for the same period in 2024[19] - Gross profit for the same period was $1,419,071, a significant improvement from a gross loss of $464,407 in Q1 2024[19] - The net loss for the three months ended March 31, 2025, was $1,296,242, compared to a net loss of $19,271,787 in the same period of 2024, indicating a substantial reduction in losses[21] - For the three months ended March 31, 2025, the net loss was $1,296,242, a significant improvement compared to a net loss of $19,271,787 for the same period in 2024, indicating a reduction in losses by approximately 93.3%[25] - The company reported a basic net income (loss) per share of $(0.03) for Q1 2025, compared to $(0.46) for Q1 2024[19] Operating Expenses and Cash Flow - Operating expenses decreased to $2,574,575 in Q1 2025 from $18,416,332 in Q1 2024, reflecting a reduction of approximately 86%[19] - The company reported net cash used in operating activities of $601,134 for the three months ended March 31, 2025, compared to $6,400,294 for the same period in 2024, showing a reduction in cash outflow by approximately 90.6%[25] - Cash and cash equivalents at the end of the period were $596,251, down from $4,929,781 at the end of the same period in 2024, reflecting a decrease of approximately 87.9%[28] - The company had a cash balance of $873,919 at the end of March 2025, compared to $5,286,291 at the end of March 2024, indicating a decrease of approximately 83.5%[28] Assets and Liabilities - Total current assets increased to $21,552,478 as of March 31, 2025, up from $20,949,859 as of December 31, 2024[16] - Total liabilities rose to $54,465,830 as of March 31, 2025, compared to $53,708,833 as of December 31, 2024, marking an increase of approximately 1.4%[16] - The accumulated deficit increased to $(104,882,547) as of March 31, 2025, from $(103,586,305) as of December 31, 2024[16] - Total stockholders' deficit was $(15,874,405) as of March 31, 2025, compared to $(15,078,942) as of December 31, 2024[16] Revenue Recognition - The company recognizes revenue from EPC services over time, with revenue measured based on actual costs incurred compared to total estimated costs[85] - For solar energy and battery storage system sales, revenue is recognized over time as control transfers to the customer, starting at installation[92] - The company uses cost-based input methods for revenue recognition, reflecting the relationship between actual costs incurred and total estimated costs[95] - The company recognizes revenue from product sales at the point of transfer of control, typically upon shipment or delivery[101] - For energy sold under Power Purchase Agreements (PPAs), revenue is recognized based on the volume of energy delivered and the price stated in the PPA[104] Customer and Market Insights - The company did not generate any revenue from its China segment since 2021, with all revenue for the three months ended March 31, 2025, coming from the United States segment[31] - The company has not entered into new loans since early 2020, with revenues primarily derived from its existing loan portfolio[106] - The company has no customers accounting for 10% or more of revenues for the three months ended March 31, 2025, indicating a diversified customer base[182] Warranty and Liabilities - The Company provides a 25-year workmanship warranty for solar and battery systems sold in the U.S., covering installation defects[67] - The warranty for LED products ranges from one year for labor to up to seven years for certain products sold to governmental municipalities[70] - The warranty liability balance at the end of the period was $2,163,579, up from $2,087,698 at the end of the previous year, reflecting an increase in warranty provisions[179] Stock and Compensation - The company reported stock-based compensation of $17,210,288 in the prior year, which was not present in the current year, indicating a significant change in compensation structure[25] - The chief executive officer's annual salary for 2025 is $760,062, reflecting an increase from $737,924 in 2024[197] - The company recognized a compensation cost of $17.2 million related to stock options for the three months ended March 31, 2024, due to the completion of its initial public offering[209] Future Outlook and Concerns - Management is focused on expanding the customer base for commercial solar installations in the United States and negotiating the exchange of approximately $6.0 million of related party loans for convertible notes[41] - There is substantial doubt regarding the Company's ability to continue as a going concern within one year from the date of the financial statements due to recurring operating losses and negative cash flows[42] - The Company did not have any agreements or negotiations for its China segment as of March 31, 2025, and may require additional capital in the future[42]
SolarMax Technology(SMXT) - 2025 Q1 - Quarterly Report