Cyngn(US:CYN)2025-08-07 21:02PART I FINANCIAL INFORMATION Financial Statements The company's unaudited financial statements show significant asset growth and a widened net loss for the six months ended June 30, 2025 Condensed Consolidated Balance Sheets Total assets grew to $56.2 million while total liabilities decreased to $9.4 million, boosting stockholders' equity significantly Balance Sheet Highlights | Balance Sheet Highlights | June 30, 2025 (Unaudited) | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash | $31,343,213 | $23,617,733 | | Short-term investments | $7,891,623 | $– | | Total Current Assets | $43,634,634 | $25,582,955 | | Total Assets | $56,180,914 | $30,095,349 | | Liabilities & Equity | | | | Total Current Liabilities | $3,000,236 | $3,489,338 | | Warrant liability | $– | $15,012,361 | | Total Liabilities | $9,417,756 | $18,501,699 | | Total Stockholders' Equity | $46,763,158 | $11,593,650 | Condensed Consolidated Statements of Operations Revenue grew year-over-year, but the six-month net loss widened to $13.0 million due to changes in warrant liability fair value Statement of Operations (Three Months Ended June 30) | Statement of Operations | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Revenue | $33,726 | $8,665 | | Loss from Operations | $(5,501,865) | $(5,812,204) | | Net Loss | $(5,448,312) | $(5,818,952) | | Net Loss Per Share | $(2.70) | $(610.85) | Statement of Operations (Six Months Ended June 30) | Statement of Operations | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Revenue | $80,878 | $14,179 | | Loss from Operations | $(10,716,898) | $(11,778,563) | | Change in fair value of warrant liability | $(2,544,518) | $– | | Net Loss | $(13,041,154) | $(11,789,031) | | Net Loss Per Share | $(8.22) | $(1,521.56) | Condensed Consolidated Statements of Stockholders' Equity Stockholders' equity increased to $46.8 million, driven by capital raised from public offerings and warrant exercises - For the six months ended June 30, 2025, the company raised significant capital through public offerings, including $29.6 million from common stock issuance and $9.97 million from the exercise of Series B warrants12 - Series A warrants were reclassified from liability to equity, adding $7.6 million to additional paid-in capital during the first half of 202512 Condensed Consolidated Statements of Cash Flows Net cash from financing activities surged to $29.6 million, offsetting cash used in operations and investing activities Cash Flow Summary | Cash Flow Summary | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | $(12,770,363) | $(10,225,478) | | Net Cash (Used in) Provided by Investing Activities | $(9,114,810) | $2,977,830 | | Net Cash Provided by Financing Activities | $29,610,653 | $9,587,002 | | Net Increase in Cash | $7,725,480 | $2,339,354 | | Cash at End of Period | $31,343,213 | $5,930,977 | Notes to Condensed Consolidated Financial Statements The notes detail the company's autonomous vehicle business, history of losses, financing activities, and a material weakness in internal controls - The company develops and deploys autonomous vehicle technology, including its full-stack software ("DriveMod") and Enterprise Autonomy Suite ("EAS"), for industrial organizations18 - The company has a history of losses, with a net loss of $13.0 million for the six months ended June 30, 2025, and an accumulated deficit of $202.3 million; however, management believes it has sufficient funds for operations for the next 12 months2224 - The company effected two reverse stock splits: a 1-for-100 ratio in July 2024 and a 1-for-150 ratio in February 2025, with all share and per-share data retroactively adjusted2021 - A potential contingency exists where a former placement agent claims a $2.3 million cash fee and 370,114 warrants related to June 2025 offerings, which the company is contesting152 Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) Management discusses its business focus, recent financing activities, operational results, and liquidity position - The company's business model focuses on its Enterprise Autonomy Suite (EAS), which includes DriveMod (AV software), Cyngn Insight (fleet management), and Cyngn Evolve (AI/ML training infrastructure)161169 - Revenue is expected from two main sources: project-based fees for initial deployments and recurring Software as a Service (SaaS) subscriptions for the EAS164 - In June 2025, the company completed two registered direct offerings, raising combined net proceeds of approximately $27.4 million ($14.7 million and $12.7 million) to be used for general corporate purposes171173175 - The company regained compliance with Nasdaq's minimum bid price requirement in March 2025 after a 1-for-150 reverse stock split but is subject to a one-year mandatory panel monitor184185 Results of Operations Revenue grew while R&D expenses decreased due to cost capitalization and G&A expenses rose from higher personnel costs Expense Comparison (Six Months Ended June 30) | Expense Category | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change | | :--- | :--- | :--- | :--- | | Research and Development | $4.1 million | $6.4 million | -35.8% | | General and Administrative | $6.7 million | $5.3 million | +26.2% | - The decrease in R&D expense is primarily attributed to a reduction in personnel-related costs and the capitalization of costs for software and customer contracts201202 - The increase in G&A expense is primarily due to an increase in personnel-related costs203204 Liquidity and Capital Resources The company's liquidity improved to $39.2 million in cash and investments, sufficient to fund operations for the next 12 months - The company's cash and short-term investments totaled approximately $39.2 million as of June 30, 2025209 - Net cash provided by financing activities for the first six months of 2025 was $29.6 million, a significant increase from $9.6 million in the same period of 2024, primarily from the sale of common stock223 - Management believes the company has sufficient funds for sustainable operations and to meet its obligations for the 12 months following the issuance of the financial statements220 Quantitative and Qualitative Disclosures About Market Risk As a "Smaller Reporting Company," the company is not required to provide this disclosure - Disclosure for this item is not required as the company qualifies as a "Smaller Reporting Company"227 Controls and Procedures Disclosure controls were deemed effective, but a previously identified material weakness in internal control remains unremediated - A material weakness related to "ineffective oversight of third parties engaged to assist in the Company's financial reporting process" identified in Q4 2024 remained unremediated as of June 30, 2025230 - Management has implemented a new control to address the weakness, but its effectiveness has not yet been tested230 - Despite the material weakness, management believes the condensed consolidated financial statements are fairly presented in all material respects230 PART II OTHER INFORMATION Legal Proceedings The company is not currently a party to any material legal proceedings - The company is not currently involved in any material legal proceedings235 Risk Factors No material changes to previously disclosed risk factors were reported for the period - No material changes to the risk factors disclosed in the Form 10-K were reported for the three months ended June 30, 2025237 Unregistered Sales of Equity Securities and Use of Proceeds The company reported no unregistered sales of equity securities during the period - None238 Other Information No directors or officers adopted or terminated Rule 10b5-1 trading arrangements during the quarter - No director or officer adopted or terminated a Rule 10b5-1 trading arrangement in Q2 2025241 Exhibits This section lists exhibits filed with the report, including agreements and officer certifications