Financial Performance - For Q3 2025, Nixxy, Inc. reported revenue of $31.9 million, a significant increase of $31.8 million or 23387% compared to $0.1 million in Q3 2024, primarily driven by telecommunications services [268]. - For the nine-month period ended September 30, 2025, revenue was $46.8 million, an increase of $46.3 million or 9416% compared to $0.5 million in the same period of 2024, mainly due to telecommunications services [277]. - The net loss for Q3 2025 was $2.2 million, a reduction from a net loss of $13.3 million in Q3 2024 [276]. - Net loss from continuing operations decreased to $2.2 million for the nine months ended September 30, 2025, compared to a net loss of $11.0 million in the same period of 2024 [285]. - The company has incurred net losses and negative operating cash flows since inception, with a net loss of $10.9 million for the nine months ended September 30, 2025 [297]. - Adjusted EBITDA loss for the nine months ended September 30, 2025, was $5.7 million, an improvement from a loss of $124,596 in 2024 [290]. Operating Expenses - Total operating expenses for Q3 2025 reached $34.1 million, an increase of $28.5 million or 505% from $5.6 million in Q3 2024, due to higher amortization, cost of revenue, and product development expenses [270]. - Operating expenses for the nine-month period ended September 30, 2025, totaled $56.4 million, an increase of $48.4 million or 604% from $8.0 million in the corresponding period in 2024 [279]. - General and administrative expenses were $7.5 million for the nine months ended September 30, 2025, compared to $7.1 million in 2024, with non-cash stock-based compensation accounting for $3.6 million in 2025 and $5.1 million in 2024 [283]. - Product development expenses increased to $229 thousand for the nine months ended September 30, 2025, from $32 thousand in 2024, primarily due to higher hosting and data expenses [281]. - Non-cash amortization charges for intangible assets rose to $1.6 million in 2025 from $0.8 million in 2024 [282]. Cash Flow and Financing - Net cash used in operating activities was $4.1 million for the nine months ended September 30, 2025, compared to $1.7 million in 2024 [291]. - Net cash provided by financing activities was $2.0 million for the nine months ended September 30, 2025, primarily from $1.8 million in cash received from the sale of common stock [294]. - As of September 30, 2025, the company had approximately $0.1 million in cash on hand, insufficient to meet working capital needs for the next 12 months [296]. - Future operations are expected to be funded through additional securities offerings, as equity offerings have been the primary source of liquidity to date [299]. Strategic Developments - Nixxy, Inc. secured a $2.0 million revolving growth facility in September 2025 to fund expansion efforts, with a fixed conversion feature priced at $2.00 per share [266]. - The company completed the acquisition of Everythink Innovations' carrier and edge data center assets, adding an estimated $48 million of annual recurring revenue (ARR) exposure [265]. - Significant development progress was made on the Leadnova platform, which entered User Acceptance Testing in Q4 2025, with a commercial launch targeted for early 2026 [266]. - The company is undergoing a strategic transformation, including the planned spin-out of recruitment-related businesses to CognoGroup, which is expected to hold key technology assets [254]. Revenue Recognition - Marketplace advertising revenues are recognized on a gross basis when advertising is placed and displayed, with payments typically due within 30 days of service completion [305]. - Consulting and staffing services revenues are recognized when services are rendered, with payments typically due within 90 days of service completion [306]. - Auralink recognizes revenue for SMS and VoiceIP transmission services at the point of delivery confirmation, acting as principal in these transactions [307]. - Contract liabilities arise when customers have paid for services but revenue recognition criteria have not yet been met [308]. Accounting Standards and Practices - Goodwill is tested for impairment annually or when indicators suggest fair value may be below carrying value, with assessments based on qualitative and quantitative factors [311][313]. - Stock-based compensation is measured at grant date fair value and recognized over the service or vesting period, requiring significant judgment in estimating various factors [316]. - The FASB issued ASU 2023-07 to improve reportable segment disclosures, effective for annual periods beginning after December 15, 2023 [318]. - ASU 2023-09 aims to enhance income tax disclosures, effective January 1, 2025 [319]. - ASU 2024-03 requires detailed disaggregation of expenses in the income statement, effective for fiscal years beginning after December 15, 2026 [320].
Recruiter.com(RCRT) - 2025 Q3 - Quarterly Report