GCT Semiconductor Holding, Inc.(GCTS) - 2025 Q2 - Quarterly Report

PART I—FINANCIAL INFORMATION Item 1. Financial Statements (Unaudited) This section provides GCT Semiconductor's unaudited condensed consolidated financial statements and detailed notes for Q2 2025 and prior periods Condensed Consolidated Balance Sheets This section details GCT Semiconductor's assets, liabilities, and stockholders' deficit for the reported periods Condensed Consolidated Balance Sheets (in thousands) | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Assets | | | | Total current assets | $15,746 | $17,591 | | Total assets | $17,619 | $19,897 | | Liabilities | | | | Total current liabilities | $74,044 | $60,922 | | Total liabilities | $87,595 | $79,212 | | Stockholders' Deficit | | | | Total stockholders' deficit | $(69,976) | $(59,315) | - Total assets decreased by $2,278 thousand from December 31, 2024, to June 30, 2025, primarily due to a decrease in current assets[15] - Total liabilities increased by $8,383 thousand, driven by a significant increase in current liabilities, particularly borrowings and current convertible promissory notes[15] - Stockholders' deficit worsened by $10,661 thousand, reflecting accumulated losses[15] Condensed Consolidated Statements of Operations This section presents GCT Semiconductor's revenues, expenses, and net loss for the reported periods Condensed Consolidated Statements of Operations (in thousands) | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total net revenues | $1,182 | $1,468 | $1,678 | $4,733 | | Gross profit | $378 | $921 | $466 | $2,874 | | Total operating expenses | $7,970 | $8,000 | $15,798 | $2,717 | | Loss from operations | $(7,592) | $(7,079) | $(15,332) | $157 | | Net loss | $(13,538) | $(1,043) | $(20,506) | $(286) | | Basic and diluted net loss per common share | $(0.26) | $(0.02) | $(0.41) | $(0.01) | - Net revenues decreased by 19% for the three months ended June 30, 2025, and by 65% for the six months ended June 30, 2025, compared to the respective prior-year periods[17] - Net loss significantly increased to $(13,538) thousand for Q2 2025 from $(1,043) thousand for Q2 2024, and to $(20,506) thousand for YTD 2025 from $(286) thousand for YTD 2024[17] - Operating expenses for the six months ended June 30, 2025, increased by 481% to $15,798 thousand, largely due to the absence of a significant gain on extinguishment of liability recognized in the prior year[17] Condensed Consolidated Statements of Comprehensive Income (Loss) This section presents GCT Semiconductor's comprehensive income or loss, including foreign currency adjustments Condensed Consolidated Statements of Comprehensive Income (Loss) (in thousands) | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net loss | $(13,538) | $(1,043) | $(20,506) | $(286) | | Foreign currency translation adjustment | $(1,692) | $708 | $(1,743) | $1,772 | | Comprehensive income (loss) | $(15,230) | $(335) | $(22,249) | $1,486 | - Comprehensive loss significantly increased for both the three and six months ended June 30, 2025, primarily driven by the increased net loss and negative foreign currency translation adjustments[20] Condensed Consolidated Statements of Stockholders' Deficit This section details changes in GCT Semiconductor's stockholders' deficit for the reported periods Condensed Consolidated Statements of Stockholders' Deficit (in thousands) | Metric (in thousands) | December 31, 2024 | June 30, 2025 | | :-------------------- | :---------------- | :------------ | | Common Stock (shares) | 47,987 | 55,784 | | Common Stock (amount) | $5 | $6 | | Additional Paid-In Capital | $501,195 | $512,782 | | Accumulated Other Comprehensive Income (Loss) | $1,518 | $(225) | | Accumulated Deficit | $(562,033) | $(582,539) | | Total Stockholders' Deficit | $(59,315) | $(69,976) | - The total stockholders' deficit increased from $(59,315) thousand at December 31, 2024, to $(69,976) thousand at June 30, 2025, primarily due to net losses incurred[23] - Additional paid-in capital increased by $11,587 thousand, reflecting proceeds from common stock issuances, including a registered direct offering and at-market agreement[23] - Common stock shares outstanding increased from 47,987 thousand to 55,784 thousand, driven by various equity issuances[23] Condensed Consolidated Statements of Cash Flows This section presents GCT Semiconductor's cash flows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows (in thousands) | Metric (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------- | :----------------------------- | :----------------------------- | | Net cash used in operating activities | $(16,589) | $(24,062) | | Net cash used in investing activities | $(209) | $(131) | | Net cash provided by financing activities | $16,128 | $27,860 | | Net increase (decrease) in cash and cash equivalents | $(169) | $3,777 | | Cash and cash equivalents at end of period | $1,266 | $4,035 | - Net cash used in operating activities decreased from $(24,062) thousand in H1 2024 to $(16,589) thousand in H1 2025[26] - Net cash provided by financing activities decreased from $27,860 thousand in H1 2024 to $16,128 thousand in H1 2025, reflecting lower proceeds from reverse recapitalization and convertible notes compared to the prior year[26] - Cash and cash equivalents at the end of the period decreased to $1,266 thousand as of June 30, 2025, from $4,035 thousand as of June 30, 2024[26] Notes to Unaudited Condensed Consolidated Financial Statements This section provides detailed explanations of GCT Semiconductor's accounting policies and financial components 1. Organization and Liquidity GCT Semiconductor, a fabless 5G/4G company, faces going concern doubts due to a $582.5 million accumulated deficit and $1.3 million cash, despite recent equity funding - GCT Semiconductor Holding, Inc. is a fabless semiconductor company focused on 5G/4G communication technologies[28] - The company completed a reverse recapitalization on March 26, 2024, and its common stock trades on the NYSE under 'GCTS'[29][30] - As of June 30, 2025, the company had an accumulated deficit of $582.5 million and cash and cash equivalents of $1.3 million, indicating substantial doubt about its going concern ability[31] - Common Stock Purchase Agreement (B. Riley): Right