XTI Aerospace, Inc.(XTIA) - 2025 Q2 - Quarterly Report

Special Note Regarding Forward-Looking Statements and Other Information Contained in this Report This section cautions that forward-looking statements are subject to risks, and actual results may differ materially - Forward-looking statements are identified by words like 'expects,' 'anticipates,' 'estimates,' and relate to future actions, products, performance, expenses, and financial results[7] - Key risk factors include a history of losses, ability to achieve profitability, limited operating history, delays in TriFan 600 development and certification, regulatory complexities, cancellation of pre-orders, ability to obtain financing, emerging competition, and general economic conditions[7][10] Explanatory Note This section clarifies corporate changes post-XTI Merger, detailing Legacy XTI as acquirer and two reverse stock splits for Nasdaq compliance - On March 12, 2024, XTI Aerospace, Inc. (formerly Inpixon) completed a merger with XTI Aircraft Company (Legacy XTI), with Legacy XTI surviving as a wholly-owned subsidiary and being treated as the accounting acquirer[12][13] - The Company effected a 1-for-100 reverse stock split on March 12, 2024, and a 1-for-250 reverse stock split on January 10, 2025, both to comply with Nasdaq Listing Rule 5550(a)(2)[15] PART I - FINANCIAL INFORMATION This part presents the Company's unaudited condensed consolidated financial statements, including balance sheets, statements of operations, cash flows, and detailed notes on accounting policies and financial performance Item 1. Financial Statements This section presents unaudited condensed consolidated financial statements, including balance sheets, income statements, cash flows, and detailed notes on accounting policies Condensed Consolidated Balance Sheets Balance sheets show significant increases in cash and total assets, with total liabilities rising due to warrant liabilities, reflecting recent financing | Metric | June 30, 2025 (Unaudited) (in thousands) | December 31, 2024 (in thousands) | Change (in thousands) | Percentage Change | | :-------------------------------- | :--------------------------------------- | :------------------------------- | :-------------------- | :---------------- | | Cash and cash equivalents | $20,046 | $4,105 | $15,941 | 388.3% | | Total Current Assets | $24,212 | $8,581 | $15,631 | 182.2% | | Total Assets | $35,448 | $24,291 | $11,157 | 45.9% | | Total Current Liabilities | $21,837 | $17,421 | $4,416 | 25.3% | | Warrant liability | $14,564 | $— | $14,564 | N/A | | Total Liabilities | $22,083 | $17,717 | $4,366 | 24.6% | | Total Stockholders' Equity | $12,405 | $6,574 | $5,831 | 88.7% | Unaudited Condensed Consolidated Statements of Operations Statements of operations show decreased revenue and gross profit, increased net losses for Q2 and H1 2025, driven by higher operating and warrant-related expenses | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change ($) | Change (%) | | :-------------------- | :------------------------------- | :------------------------------- | :--------- | :--------- | | Revenues | $600 | $1,031 | $(431) | (41.8)% | | Gross Profit | $483 | $662 | $(179) | (27.0)% | | Operating Expenses | $11,613 | $14,589 | $(2,976) | (20.4)% | | Loss from Operations | $(11,130) | $(13,927) | $2,797 | (20.1)% | | Other (Expense) Income | $(9,719) | $(771) | $(8,948) | 1,160.6% | | Net Loss | $(20,858) | $(14,710) | $(6,148) | 41.8% | | Net Loss Per Share - Basic and Diluted | $(2.93) | $(261.99) | N/A | N/A | | Metric (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change ($) | Change (%) | | :-------------------- | :----------------------------- | :----------------------------- | :--------- | :--------- | | Revenues | $1,084 | $1,251 | $(167) | (13.3)% | | Gross Profit | $818 | $803 | $15 | 1.9% | | Operating Expenses | $22,350 | $23,607 | $(1,257) | (5.3)% | | Loss from Operations | $(21,532) | $(22,804) | $1,272 | (5.6)% | | Other (Expense) Income | $(12,204) | $5,508 | $(17,712) | (321.6)% | | Net Loss | $(33,730) | $(17,312) | $(16,418) | 94.8% | | Net Loss Per Share - Basic and Diluted | $(6.41) | $(448.98) | N/A | N/A | Unaudited Condensed Consolidated Statements of Comprehensive Loss Statements of comprehensive loss present net loss adjusted by unrealized foreign exchange gains/losses, resulting in the total comprehensive loss | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | | Net Loss | $(20,858) | $(14,710) | | Unrealized foreign exchange gain / (loss) | $1,039 | $(32) | | Comprehensive Loss | $(19,819) | $(14,683) | | Metric (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------- | :----------------------------- | :----------------------------- | | Net Loss | $(33,730) | $(17,312) | | Unrealized foreign exchange gain / (loss) | $884 | $(198) | | Comprehensive Loss | $(32,846) | $(17,451) | Unaudited Condensed Consolidated Statements of Changes in Stockholders' Equity Statements detail changes in stockholders' equity, reflecting common stock issuances, warrant exercises, preferred stock redemption, net losses, and translation adjustments | Metric (in thousands, except shares) | January 1, 2025 Balance | June 30, 2025 Balance | | :----------------------------------- | :---------------------- | :-------------------- | | Common Stock Shares | 1,685,021 | 17,915,340 | | Common Stock Amount | $2 | $18 | | Additional Paid-In Capital | $99,425 | $138,795 | | Accumulated Other Comprehensive Income (Loss) | $(622) | $884 | | Accumulated Deficit | $(93,562) | $(127,292) | | Total Stockholders' Equity | $6,574 | $12,405 | - During the six months ended June 30, 2025, the Company issued common shares for net cash proceeds from ATM offerings ($1.7 million), public offerings ($17.9 million), conversion of debt ($0.8 million), and exercise of liability classified warrants ($18.0 million)[26] - The Company redeemed Series 9 preferred stock, resulting in a decrease of $1.4 million in equity, and recognized stock-based compensation of $1.2 million[26][