The Glimpse (VRAR) - 2025 Q4 - Annual Results

Fiscal Year 2025 Financial Results Overview FY25 Financial and Operational Highlights The Glimpse Group reported significant revenue growth in FY25 and Q4 FY25, achieved near cash breakeven, and maintained strong gross margins, driven by SpatialCore revenues and strategic reorganization efforts Revenue Growth | Metric | FY25 | FY24 | Change (YoY) | | :------------------- | :----------- | :----------- | :------------- | | Total Revenue | $10.5 million | $8.8 million | +20% | | Q4 FY25 Revenue | $3.5 million | $1.7 million | +105% | | Q4 FY25 vs Q3 FY25 | $3.5 million | $1.4 million | +150% | - Gross Margin for FY25 was approximately 67.5%, on par with 67% for FY24, and is expected to remain in the 65-75% range due to increased SpatialCore and software license sales[5] Cash Flow & Position (as of June 30, 2025) | Metric | Amount | | :-------------------------- | :----------- | | Net Operating Cash loss (FY25) | ~-$0.27 million | | Net Operating Cash loss (FY24) | ~-$5.2 million | | Cash and equivalents | ~$6.85 million | | Accounts receivable | ~$0.85 million | - The company achieved essentially cash breakeven for FY25, marking an extraordinary turnaround, and maintains a clean capital structure with no debt, convertible debt, or preferred equity[5] - FY26 revenue is expected to exceed FY25, but quarterly revenue will be 'choppy' with Q1 FY26 significantly lower than Q4 FY25, followed by sequential growth, due to the nature of Brightline's DoW contracts and potential U.S. Government budget delays[5] - Key FY25 achievements include a return to revenue growth, first-time annual cash flow neutrality, significant Tier-1 customer wins, divestiture of non-core assets, key technology developments integrating AI into Immersive products, and filing of 7 new patents focused on AI with immersive technologies[5] Strategic Business Developments and Outlook The Glimpse Group's growth is primarily driven by Brightline Interactive (BLI) and its SpatialCore product, which secured significant Department of War (DoW) contracts and achieved key technological milestones in AI-driven spatial computing, leading to a strategic decision to spin out BLI - Brightline Interactive (BLI), through its SpatialCore product, provides advanced Spatial Computing, AI-driven, operational simulation middleware software and solutions to the Department of War (DoW) and Big Data driven enterprises[6] - SpatialCore is positioned at the intersection of Spatial Computing, Immersive technologies, AI, Cloud, and Geospatial Data, functioning as an operating system for 3D information processing on the cloud[6] - BLI achieved several critical milestones in FY25, including a $4+ million initial contract for a unified synthetic training ecosystem for a major DoW entity, a $2+ million SpatialCore contract with another DoW entity, delivery of an immersive simulator to the U.S. Navy, and a Cooperative Research And Development Agreement (CRADA) with the U.S. Army DEVCOM C5ISR Center for AI/ML algorithm training[6] - These initial contracts have the potential to expand into multi-million and multi-year follow-on contracts, potentially leading to inclusion in exceptionally large, long-term DoW Programs of Record, with a robust pipeline of new potential customers in both DoW and enterprise Big Data segments[6] BLI Spin-out Strategy Glimpse Group's Board of Directors has approved a strategy to spin out Brightline Interactive (BLI) into an independent, publicly traded company to unlock its intrinsic value, which is currently not reflected in Glimpse's valuation - BLI's intrinsic value is believed to be significantly undervalued within Glimpse's current valuation, with public company comparables in the Defense Tech/AI segment trading at substantially higher multiples of trailing annual revenue[10] - The Board of Directors concluded that spinning out BLI is the best way to maximize shareholder value for Glimpse shareholders and increase BLI's chances of success, as its true value and potential are currently 'hidden' and 'encumbered' within the Glimpse umbrella[10] - If successful, BLI will become an independent, publicly traded 'PURE PLAY' company focused on Spatial Computing, AI-Driven, Cloud Operational Simulation Middleware for DoW and Big Data enterprises[10] - As part of the process, Glimpse shareholders are planned to be issued shares in the spun-out BLI public entity as a distribution, while retaining their holdings in Glimpse, which is expected to pursue attractive alternatives as a clean, healthy, Nasdaq-listed technology company[10] Company Information and Investor Resources Conference Call and Webcast Information The Glimpse Group held a conference call and webcast on September 30, 2025, to discuss its fiscal year 2025 financial results, with replay options available for a limited time - A conference call and webcast for Fiscal Year 2025 results was held on September 30, 2025, at 8:30 a.m. Eastern time[7] - Replay of the webcast will be available through Wednesday, September 2026, and a teleconference replay through Tuesday, October 15, 2025[8] About The Glimpse Group, Inc. The Glimpse Group is a diversified Immersive Technology platform company providing enterprise-focused Immersive Technology, Spatial Computing, and AI-driven software and services, aiming to offer investors a diversified entry into this emerging industry - The Glimpse Group (NASDAQ: VRAR) is a diversified Immersive Technology platform company[12] - It provides enterprise-focused Immersive Technology, Spatial Computing, and AI-driven software & services[12] - The company's business model aims to build scale and a robust ecosystem, while offering investors an opportunity to invest directly into the emerging industry via a diversified platform[12] Safe Harbor Statement This press release contains forward-looking statements based on current expectations, which are subject to risks and uncertainties, and the company assumes no obligation to update this information - The press release may contain forward-looking statements based on current expectations, forecasts, and assumptions that involve risks and uncertainties[13] - Actual results may differ materially from those stated or implied due to business risks and uncertainties[13] - The company assumes no obligation to update the information included in the press release, whether as a result of new information, future events, or otherwise[13] Company Contact Information Contact information for The Glimpse Group's CFO & COO, Maydan Rothblum, is provided for inquiries - Company Contact: Maydan Rothblum, CFO & COO[14] - Contact details: (917) 292-2685, maydan@theglimpsegroup.com[14] Consolidated Financial Statements Consolidated Balance Sheets As of June 30, 2025, The Glimpse Group significantly increased its cash and cash equivalents, leading to a substantial rise in total assets, while total liabilities decreased, strengthening its stockholders' equity Assets (as of June 30) | Asset Category | 2025 | 2024 | Change | | :-------------------------------- | :------------ | :------------ | :------- | | Cash and cash equivalents | $6,832,725 | $1,848,295 | +270% | | Accounts receivable | $840,551 | $723,032 | +16.26% | | Total current assets | $8,172,657 | $3,520,289 | +132.16% | | Total assets | $19,279,066 | $15,558,603 | +23.91% | Liabilities & Stockholders' Equity (as of June 30) | Liability/Equity Category | 2025 | 2024 | Change | | :-------------------------------- | :------------ | :------------ | :------- | | Total current liabilities | $2,338,472 | $2,427,598 | -3.67% | | Total liabilities | $2,343,176 | $4,020,118 | -41.73% | | Total stockholders' equity | $16,935,890 | $11,538,485 | +46.79% | Consolidated Statements of Operations For FY25, The Glimpse Group reported a 19.58% increase in total revenue, primarily from software services, and significantly reduced its net loss by 60.08% compared to FY24, driven by lower operating expenses Revenue (For the Years Ended June 30) | Revenue Category | 2025 | 2024 | Change (YoY) | | :-------------------------- | :----------- | :----------- | :------------- | | Software services | $9,996,491 | $8,130,515 | +23% | | Software license/software as a service | $503,734 | $673,684 | -25.23% | | Royalty income | $27,700 | - | N/A | | Total Revenue | $10,527,925 | $8,804,199 | +19.58% | Profitability (For the Years Ended June 30) | Metric | 2025 | 2024 | Change (YoY) | | :-------------------------------- | :----------- | :----------- | :------------- | | Gross profit | $7,119,979 | $5,862,739 | +21.45% | | Total operating expenses | $9,862,313 | $12,478,798 | -20.97% | | Loss from operations before other income | $(2,742,334) | $(6,616,059) | -58.55% | | Net loss | $(2,552,651) | $(6,394,295) | -60.08% | Per Share Data (For the Years Ended June 30) | Metric | 2025 | 2024 | Change (YoY) | | :-------------------------------- | :----- | :----- | :------------- | | Basic and diluted net loss per share | $(0.13) | $(0.38) | -65.79% | | Weighted-average common shares outstanding | 19,633,374 | 16,681,234 | +17.69% | Consolidated Statements of Cash Flows The Glimpse Group significantly improved its cash flow from operating activities in FY25, moving from a substantial net cash outflow to near breakeven, primarily due to reduced net loss and various non-cash adjustments, while financing activities provided substantial cash Cash Flows from Operating Activities (For the Year Ended June 30) | Metric | 2025 | 2024 | Change (YoY) | | :-------------------------------- | :------------ | :------------ | :------------- | | Net loss | $(2,552,651) | $(6,394,295) | -60.08% | | Net cash used in operating activities | $(273,774) | $(5,209,847) | -94.74% | Cash Flows from Investing Activities (For the Year Ended June 30) | Metric | 2025 | 2024 | Change (YoY) | | :-------------------------------- | :------------ | :------------ | :------------- | | Cash used in investing activities | $(1,542,508) | $(1,529,442) | +0.85% | Cash Flows from Financing Activities (For the Year Ended June 30) | Metric | 2025 | 2024 | Change (YoY) | | :-------------------------------- | :------------ | :------------ | :------------- | | Net cash provided by financing activities | $6,800,712 | $2,968,501 | +129.03% | Cash and Cash Equivalents (For the Year Ended June 30) | Metric | 2025 | 2024 | Change (YoY) | | :-------------------------------- | :------------ | :------------ | :------------- | | Net change in cash and cash equivalents | $4,984,430 | $(3,770,788) | N/A (turnaround) | | Cash and cash equivalents, end of year | $6,832,725 | $1,848,295 | +270% | Non-GAAP Financial Measures Note on Non-GAAP Financial Measures Non-GAAP financial measures are presented to provide additional insights into performance but are not a substitute for GAAP measures and may not be comparable to those of other companies - Non-GAAP financial measures are numerical measures of performance, financial position, or cash flows that either exclude or include amounts not normally excluded or included in GAAP[9] - These measures are not in accordance with, nor a substitute for, GAAP measures and may not be comparable to similarly titled measures presented by other companies[9][11] - The company believes adjusted EBITDA provides useful information to investors by offering a more focused measure of operating results and is an integral part of internal reporting to evaluate operations and management performance[11] Adjusted EBITDA Reconciliation The Glimpse Group reported a significant reduction in Adjusted EBITDA loss for FY25, improving from $(4.63) million in FY24 to $(0.87) million, reflecting operational improvements and reduced non-cash expenses Adjusted EBITDA Loss (For the Years Ended June 30, in millions) | Metric | 2025 | 2024 | Change (YoY) | | :-------------------- | :----- | :----- | :------------- | | Net loss | $(2.55) | $(6.39) | -60.09% | | EBITDA loss | $(2.04) | $(5.03) | -59.44% | | Adjusted EBITDA loss | $(0.87) | $(4.63) | -81.21% | - Key adjustments to reconcile net loss to Adjusted EBITDA loss include depreciation and amortization, stock-based compensation expenses, loss on subsidiary divestiture, gain on lease termination, change in fair value of acquisition contingent consideration, and intangible asset impairment[21]