Focus Universal(FCUV) - 2021 Q2 - Quarterly Report

Financial Performance - Consolidated gross revenue for Q2 2021 was $261,680, a decrease of 41.8% from $434,548 in Q2 2020, primarily due to shipping delays [164]. - Cost of revenue for Q2 2021 was $208,583, down from $313,157 in Q2 2020, resulting in a gross profit of $53,097 compared to $121,391 in the prior year [164]. - Total operating expenses for Q2 2021 were $716,632, a decrease of 8.3% from $781,294 in Q2 2020 [165]. - Net losses for Q2 2021 were $480,145, compared to $627,667 in Q2 2020, reflecting an improvement in financial performance [170]. - Consolidated gross revenue for the six months ended June 30, 2021, was $625,143, a decrease of $120,014 from $745,157 in the same period of 2020 [171]. - Gross profit increased to $124,297 for the six months ended June 30, 2021, compared to $93,928 for the same period in 2020 [171]. - Total operating expenses decreased to $1,507,025 for the six months ended June 30, 2021, from $1,724,112 in 2020, a reduction of $217,087 [172]. - Net losses for the six months ended June 30, 2021, were $1,162,661, down from $1,549,973 in the same period of 2020 [178]. - Cash inflows from financing activities for the six months ended June 30, 2021, were $1,762,407, compared to $355,860 in 2020 [186]. - The company plans to raise $10 million through an underwritten public offering in 2021 to support operations [187]. Research and Development - Research and development costs decreased to $47,222 in Q2 2021 from $61,797 in Q2 2020, attributed to reduced spending on supplies as new products entered the testing phase [166]. - The company has developed four proprietary technologies aimed at addressing key challenges in the IoT industry, including ultranarrowband technology and User Interface Machine auto generation [137]. - The company is testing 4 Mbps ultra-narrowband power line communication products, expected to launch in Q4 2021 [189]. - The company anticipates generating positive cash flow from new product launches starting Q2 2022 [189]. Product Development and Strategy - The company plans to enhance the Ubiquitor device using Power Line Communication (PLC) technology to facilitate smart home and gardening systems [157]. - The Ubiquitor device is designed to measure various physical phenomena and is expected to be introduced in smart home installations to improve functionality and reduce costs [146]. - The acquisition of AVX is expected to enable the company to offer a comprehensive smart home product line at competitive prices [141]. - The company has received multiple patents related to its Universal Smart Device and PLC technology, enhancing its intellectual property portfolio [158]. Assets and Working Capital - Current assets increased to $1,735,090 as of June 30, 2021, compared to $1,007,630 as of December 31, 2020 [179]. - Working capital increased to $1,163,122 as of June 30, 2021, from $480,071 as of December 31, 2020 [179].