LATCH(LTCH) - 2024 Q2 - Quarterly Report

Financial Performance - Software revenue for Q2 2024 was $5,022,000, an increase of 13.8% from $4,413,000 in Q2 2023[239] - Total revenue for Q2 2024 reached $12,938,000, reflecting a 27.1% increase from $10,178,000 in Q2 2023[239] - The net loss for Q2 2024 was $16,937,000, a significant improvement of 45.1% compared to a net loss of $30,876,000 in Q2 2023[239] - Adjusted EBITDA for Q2 2024 was $(9,908,000), showing a 50.7% improvement from $(20,112,000) in Q2 2023[239] - For the first half of 2024, software revenue totaled $10,059,000, up 19.9% from $8,386,000 in the first half of 2023[239] - Total revenue for the first half of 2024 was $24,973,000, an increase of 17.1% from $21,328,000 in the first half of 2023[239] - The net loss for the first half of 2024 was $30,574,000, a 52.1% improvement from $63,800,000 in the first half of 2023[239] - Total revenue for the three months ended June 30, 2024, increased by $2.8 million (27.1%) to $12.9 million compared to the same period in 2023, driven by increases in hardware, software, and professional services revenue[265] - For the six months ended June 30, 2024, total revenue increased by $3.6 million (17.1%) to $25.0 million, with software revenue increasing by $1.7 million (19.9%) and professional services revenue increasing by $1.4 million (40.6%) compared to the same period in 2023[275] Expenses and Cost Management - Total operating expenses decreased by $11.5 million (32.7%) to $23.7 million for the three months ended June 30, 2024, primarily due to reductions in research and development, sales and marketing, and general and administrative expenses[265] - Research and development expenses decreased by $5.7 million (66.1%) to $2.9 million, attributed to a $4.8 million decrease in personnel-related expenses[270] - Sales and marketing expenses decreased by $2.1 million (48.6%) to $2.3 million, mainly due to a reduction in personnel-related expenses and professional fees[271] - General and administrative expenses decreased by $3.8 million (18.5%) to $16.7 million, primarily due to a decrease related to the Investigation and Restatement[272] - Research and development expenses decreased by $10.6 million for the six months ended June 30, 2024, mainly from an $8.6 million reduction in personnel-related expenses[279] - Sales and marketing expenses decreased by $4.2 million for the six months ended June 30, 2024, driven by a $2.4 million decrease in personnel-related expenses[280] - General and administrative expenses decreased by $7.1 million for the six months ended June 30, 2024, largely due to a $6.3 million decrease in investigation and restatement costs[281] - Cost of revenue decreased by $7.3 million for the six months ended June 30, 2024, primarily due to an $8.6 million decrease in hardware costs[278] Cash Flow and Financial Position - As of June 30, 2024, the company's unrestricted cash and cash equivalents were approximately $110.0 million[286] - Net cash used in operating activities for the six months ended June 30, 2024 was $44.5 million, a decrease of $0.8 million compared to the same period in 2023[296] - Net cash provided by investing activities increased by $3.9 million for the six months ended June 30, 2024, primarily due to a decrease in purchases of available-for-sale securities[297] - The company repaid $22.0 million in promissory notes in April 2024, which were issued in connection with the HDW Acquisition[290] - The company expects to use its current cash and cash equivalents and available-for-sale securities to fund operational cash requirements for at least 12 months from the date of the report[292] Strategic Initiatives - The company completed the merger with HelloTech on July 1, 2024, enhancing its service offerings in the multifamily building sector[236] - The ongoing expansion of the DOOR Platform aims to integrate broader smart home solutions, including sensors and thermostats, to create more connected buildings[231] - The company is focused on improving its financial reporting and internal controls following an investigation into its key performance indicators and revenue recognition practices[235] Shareholder Information - The weighted average shares outstanding for basic and diluted calculations increased to 156,386,470 from 144,609,513 year-over-year[265] - Total other income, net increased by $0.4 million (81.7%) to $0.9 million, driven by a favorable change in the fair value of warrant liability[274] - Total other income, net increased by $0.5 million for the six months ended June 30, 2024, primarily from a $0.3 million favorable change in the fair value of private placement warrants[283]