ViewBix Inc(VBIX) - 2025 Q2 - Quarterly Report

Financial Performance - Revenues for the three months ended June 30, 2025, were $2,281 thousand, a decrease of 68.8% compared to $7,333 thousand during the same period in the prior year [229]. - Revenues from Cortex's Content Platform were $1,911 thousand for the three months ended June 30, 2025, down 69.3% from $6,218 thousand in the prior year, primarily due to the Cortex Adverse Effect [230]. - Revenues from Gix Media's Search Platform were $354 thousand for the three months ended June 30, 2025, a decrease of 68.3% compared to $1,115 thousand during the same period in the prior year [231]. - Traffic-acquisition and related costs were $1,880 thousand for the three months ended June 30, 2025, down 67.8% from $5,854 thousand in the prior year [232]. - Research and development expenses were $125 thousand for the three months ended June 30, 2025, a decrease of 76.5% compared to $532 thousand during the same period in the prior year [233]. - Selling and marketing expenses decreased to $190 thousand for the three months ended June 30, 2025, down 58.1% from $453 thousand in the prior year [234]. - General and administrative expenses were $576 thousand for the three months ended June 30, 2025, a decrease of 10.8% compared to $646 thousand during the same period in the prior year [235]. - A goodwill impairment loss of $3,150 thousand was recorded during the three months ended June 30, 2025, compared to $4,739 thousand in the prior year [237]. - Net financial expenses were $7,622 thousand for the three months ended June 30, 2025, an increase of 177.5% compared to $2,744 thousand during the same period in the prior year [239]. - Net financial expenses increased to $10,525 thousand for the six months ended June 30, 2025, from $2,907 thousand in the prior year, mainly due to financing expenses from facility agreements [252]. - Income tax benefit was $153 thousand for the six months ended June 30, 2025, compared to $23 thousand in the same period in the prior year [253]. - Negative cash flow from operating activities for the six months ended June 30, 2025, was $836 thousand, down from a positive cash flow of $1,456 thousand in the prior year [261]. - Positive cash flow from financing activities for the six months ended June 30, 2025, was $2,303 thousand, compared to a negative cash flow of $2,728 thousand in the same period in the prior year [265]. Company Operations and Strategy - The company’s digital advertising operations are divided into two main sectors: the Search Platform and the Content Platform, focusing on optimizing online campaigns [203]. - Cortex's Content Platform has shifted its strategy to direct searches through content to Google's search platform, enhancing revenue generation capabilities [211]. - The company has reduced its operations and sales team size due to failure to meet sales targets set in a prior recapitalization transaction [202]. - The company is facing risks related to the demand for digital advertising and the ability to attract programmatic advertisers, which could impact future cash flows [200]. - The company experienced a decrease in revenues from Content and Search Platforms due to various adverse factors, raising doubts about its ability to continue as a going concern [270][271]. - Management's response included salary reductions, operational expense cuts, and raising capital through facility agreements and a private placement, which generated $4.5 million in gross proceeds [272]. Financial Position - Current assets as of June 30, 2025, totaled $4,143 thousand, with $1,988 thousand in cash and cash equivalents [254]. - Current liabilities as of June 30, 2025, were $12,657 thousand, including $5,531 thousand in accounts payable and $5,385 thousand in short-term loans [255]. - As of June 30, 2025, the company was in compliance with financial covenants related to its financing agreements [269]. - The company’s ability to continue as a going concern is under substantial doubt, necessitating additional capital to meet future business requirements [200]. Corporate Actions - The company completed a private placement on July 11, 2025, raising approximately $4.5 million before fees, with potential additional proceeds of $4.4 million if warrants are fully exercised [212][216]. - The company’s shares began trading on The Nasdaq Capital Market under the symbol "VBIX" on June 5, 2025, after being approved for listing [217]. - A petition for insolvency proceedings against Gix Media was filed on March 27, 2025, claiming approximately $260,000 in debts, which was settled with a payment of $1.13 million on July 22, 2025 [219][220]. - The company underwent a one-for-four reverse stock split effective March 14, 2025, impacting share and per share amounts [198]. - The company is required to file a resale registration statement with the SEC for shares issued in the July 2025 Private Placement within 14 trading days [214]. - The Company completed the acquisition of Metagramm, resulting in the issuance of 1,323,000 shares, representing 19.99% of its capital stock, in exchange for 100% of Metagramm's share capital on March 24, 2025 [222]. - Other expenses for the six months ended June 30, 2025, were $544 thousand, compared to $213 thousand in other income during the same period in 2024, primarily related to the Uplist [250].