LATCH(LTCH) - 2025 Q2 - Quarterly Report

Financial Performance - Software revenue for Q2 2025 was $5,244,000, a 4.4% increase from $5,022,000 in Q2 2024[145] - Total revenue for Q2 2025 reached $19,055,000, representing a 47.3% increase from $12,938,000 in Q2 2024[145] - Net loss for Q2 2025 improved to $(7,849,000), a 53.7% reduction from $(16,937,000) in Q2 2024[145] - Adjusted EBITDA for Q2 2025 was $(5,689,000), a 24.3% improvement from $(7,519,000) in Q2 2024[145] - Total revenue for the first half of 2025 was $34,829,000, a 39.5% increase from $24,973,000 in the same period of 2024[146] - Net loss for the first half of 2025 was $(19,099,000), a 37.5% improvement from $(30,574,000) in the first half of 2024[146] - Total revenue increased by $6.1 million (47.3%) for the three months ended June 30, 2025, compared to the same period in 2024, primarily driven by a $5.6 million increase in professional services revenue[173] - Net loss for the three months ended June 30, 2025, was $7.8 million, a 53.7% improvement from a net loss of $16.9 million in 2024[171] - Total revenue for the six months ended June 30, 2025, was $34.8 million, a 39.5% increase from $25.0 million in 2024[180] Professional Services - Professional services revenue is generated through project-based hardware installation, technology services, and property management services[155] - Professional services revenue for the three months ended June 30, 2025, was $7.9 million, a 238.4% increase from $2.3 million in 2024[171] - Professional services revenue for the six months ended June 30, 2025, increased by $9.8 million (208.7%) compared to the same period in 2024[182] Operating Expenses - Total operating expenses decreased by $7.9 million (33.5%) for the three months ended June 30, 2025, compared to the same period in 2024[171] - Research and development expenses increased by $1.5 million (51.5%) for the three months ended June 30, 2025, compared to the same period in 2024[175] - Sales and marketing expenses increased by $1.9 million (84.3%) for the three months ended June 30, 2025, compared to the same period in 2024[176] - General and administrative expenses decreased by $10.9 million (65.0%) for the three months ended June 30, 2025, compared to the same period in 2024[177] - Research and development expenses increased by $2.9 million for the six months ended June 30, 2025, primarily due to a $1.6 million increase in third-party expenses and a $1.0 million increase in compensation expenses[184] - Sales and marketing expenses rose by $3.0 million for the six months ended June 30, 2025, mainly driven by a $2.1 million increase in compensation expenses and a $0.5 million increase in digital marketing expenses[185] - General and administrative expenses decreased by $14.9 million for the six months ended June 30, 2025, due to reductions in legal fees, RSU expenses, and consulting fees[186] Cash Flow and Financing - As of June 30, 2025, the company's unrestricted cash and cash equivalents were approximately $50.4 million, with an additional $31.8 million in net inventory[190][191] - Net cash used in operating activities decreased by $21.2 million for the six months ended June 30, 2025, compared to the same period in 2024[203] - Net cash provided by investing activities decreased by $58.8 million for the six months ended June 30, 2025, primarily due to the use of investment proceeds to fund operating losses[206] - Net cash used in financing activities decreased by $21.4 million for the six months ended June 30, 2025, reflecting a significant reduction in repayments compared to the previous year[207] - The company entered into a loan agreement for a principal amount of $6.0 million, with interest payable at a rate equal to the greater of the prime rate or 6.0%[198] - The company expects to use its current cash and cash equivalents to fund operational cash requirements for at least 12 months from the date of the report[196] Product and Service Expansion - The company is expanding its DOOR Platform to include broader smart home solutions, integrating devices such as sensors, thermostats, and lighting[139] - The company operates a nationwide network of technicians through HelloTech, providing on-demand technical services and home services[142]