AIRSHIP(US:AISP)2025-11-14 21:20Financial Performance - For the three months ended September 30, 2025, net revenues decreased by $1,691,000 to $1,177,000, a decline of 59.0% compared to $2,868,000 in the same period of 2024 [182]. - Gross profit for the same period was $603,000, down 72.0% from $2,154,000 in Q3 2024 [182]. - Operating loss for the three months ended September 30, 2025, was $2,867,000, an increase of 80.7% compared to a loss of $1,587,000 in Q3 2024 [182]. - Net revenues for the nine months ended September 30, 2025 decreased by $11,017,000 to $8,827,000, a decline of 55.5% compared to $19,844,000 for the same period in 2024 [192]. - Operating loss for the nine months ended September 30, 2025 was $6,603,000, compared to an operating loss of $2,014,000 for the same period in 2024, an increase of $4,589,000 [193]. - Net income for the nine months ended September 30, 2025 was $6,361,000, compared to a net loss of $7,289,000 for the same period in 2024, representing a turnaround of $13,650,000 [201]. - Other income for the nine months ended September 30, 2025 was $12,964,000, compared to other expense of $5,275,000 for the same period in 2024, an increase of $18,239,000 [199]. Expenses - Research and development expenses for the three months ended September 30, 2025, were $753,000, a 29.9% decrease from $1,074,000 in the same period of 2024 [182]. - Research and development expenses for the nine months ended September 30, 2025 decreased by $259,000 to $2,213,000, a decline of 10.5% compared to $2,472,000 for the same period in 2024 [197]. - Selling, general and administrative expenses for the nine months ended September 30, 2025 increased by $69,000 to $8,761,000, a slight increase of 0.8% compared to $8,830,000 for the same period in 2024 [198]. Liabilities and Backlog - The backlog as of October 6, 2025, was approximately $11 million, representing firm fixed price contracts awarded in Q3 2025 [157]. - The total liabilities measured at fair value as of September 30, 2025, were $39,430,170, down from $57,485,426 as of December 31, 2024 [173]. Cash Flow and Liquidity - Net cash used in operating activities for the nine months ended September 30, 2025 was $4,502,000, primarily related to net income of $6,361,000 and noncash items of $11,339,000 [204]. - Liquidity assessment indicates no substantial doubt about the company's ability to continue as a going concern, with an accumulated deficit of $68.6 million as of September 30, 2025 [203]. Real Estate and Leases - The company entered into a lease for 15,567 square feet of office and warehouse space in Redmond, WA, starting October 1, 2023, with monthly payments of $25,000 [208]. - The company entered into an office lease in Mooresville, North Carolina, for 5,240 square feet with a net monthly payment of $9,105, expiring on January 31, 2028, with a 3% increase in payment starting February 1, 2026 [209]. Accounting and Reporting - The consolidated financial statements are prepared in accordance with U.S. GAAP, requiring estimates and assumptions that could differ materially from actual results due to economic uncertainties [212]. - The significant accounting policies have not materially changed from those discussed in the Annual Report for the year ended December 31, 2024 [213]. - The company does not have applicable quantitative and qualitative disclosures about market risk as it is classified as a smaller reporting company [214]. Other Financial Metrics - The company reported a gain from the change in fair value of the earnout liability of $3,893,000, down 29.4% from $5,512,000 in the previous year [182]. - The gain from the change in fair value of warrant liability was $5,331,000, an increase of 115.7% compared to $2,471,000 in Q3 2024 [182]. - Cost of net revenues for the nine months ended September 30, 2025 decreased by $6,100,000 to $4,456,000, a reduction of 57.8% compared to $10,556,000 for the same period in 2024 [195]. - There are no off-balance sheet arrangements that are likely to materially affect the company's financial condition, revenue, or expenses [210].