Financial Performance - For the three-month period ended September 30, 2025, the company reported revenue of $31.9 million, a significant increase of $31.8 million or 23387% compared to $0.1 million in the same period of 2024, primarily driven by telecommunications services [268]. - For the nine-month period ended September 30, 2025, revenue reached $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 company incurred a net loss from continuing operations of $2.2 million for the three-months ended September 30, 2025, compared to a net loss of $13.3 million in the same period of 2024 [276]. - Net loss from continuing operations was $2.2 million for the nine months ended September 30, 2025, a significant improvement from a net loss of $11.0 million in the same period of 2024 [285]. - Adjusted EBITDA loss for the nine months ended September 30, 2025, was $5.7 million, compared to a loss of $124,596 in 2024 [290]. - 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]. Revenue and Cost of Revenue - The cost of revenue for the same period was $31.8 million, reflecting an increase of $31.8 million from $0 in the corresponding period in 2024, attributed to the rise in revenue-generating operations [269]. - The cost of revenue for the nine-month period was $46.4 million, up from $3,000 in the corresponding period in 2024, representing an increase of $46.4 million [278]. Operating Expenses - Total operating expenses for the three-month period ended September 30, 2025, were $34.1 million, an increase of $28.5 million or 505% compared to $5.6 million in the same period of 2024 [270]. - Total operating expenses for the nine-month period ended September 30, 2025, were $56.4 million, an increase of $48.4 million or 604% compared to $8.0 million in the same period of 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]. 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]. - The company secured a $2.0 million revolving growth facility to fund disciplined expansion without compromising shareholder alignment [266]. - Future operations are expected to be funded through additional securities offerings, as equity offerings have been the primary source of liquidity to date [299]. Acquisitions and Developments - The company completed the acquisition of Everythink Innovations' carrier and edge data center assets, adding an estimated $48 million of ARR exposure into NIXXY CORE™ [265]. - The Leadnova platform entered User Acceptance Testing in Q4 2025, with a commercial launch targeted for early 2026 [266]. - 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]. Accounting Policies and Standards - 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]. - 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].
Nixxy, Inc.(NIXX) - 2025 Q3 - Quarterly Report