Minim(US:MINM)2023-11-13 11:31Financial Performance - For the three months ended June 30, 2023, net sales decreased by $5.7 million or 44.1% compared to the same period in 2022, totaling $7.2 million[98]. - For the six months ended June 30, 2023, net sales decreased by $8.2 million or 31.4%, totaling $17.9 million[98]. - The gross profit for the three months ended June 30, 2023, was $486 thousand, a decrease of $2.1 million or 80.9% year-over-year[98]. - The operating loss for the three months ended June 30, 2023, was $5.5 million, an increase of $1.2 million or 27.4% compared to the same period in 2022[98]. - The company reported a net loss of $5.6 million for the three months ended June 30, 2023, compared to a net loss of $4.4 million in the same period of 2022, reflecting a 26.5% increase in losses[98]. Liquidity and Going Concern - Cash and cash equivalents decreased to $0.3 million as of June 30, 2023, down from $0.5 million on December 31, 2022[90]. - The company experienced material liquidity pressures due to supply disruptions and negative cash-flow positions, raising substantial doubt about its ability to continue as a going concern[92]. - There is substantial doubt regarding the company's ability to continue as a going concern, requiring additional liquidity to sustain operations beyond the next 12 months[113]. - As of June 30, 2023, the company had $2.4 million of borrowings outstanding and $25 thousand available on its $10.0 million SVB line-of-credit[111]. Sales and Revenue Breakdown - Sales of Motorola branded cable modems and gateways were the primary contributors to the decline in net sales[99]. - SaaS sales decreased by $72 thousand or 49.3% in the three months ended June 30, 2023, compared to the same period in 2022[99]. - Net sales for the three months ended June 30, 2023, were $17,947 thousand, a decrease of $5,669 thousand or 44.1% compared to the same period in 2022[102]. Cost and Expense Management - Gross margin for the three months ended June 30, 2023, was 6.8%, down from 19.7% in the prior year, primarily due to insufficient sales levels to cover fixed and variable costs[102]. - Selling and marketing expenses decreased by $243 thousand or 6.3% in the three months ended June 30, 2023, compared to the same period in 2022, mainly due to a reduction in personnel expenses[104]. - General and administrative expenses decreased by $448 thousand or 27.7% in the three months ended June 30, 2023, compared to the same period in 2022, primarily due to lower personnel and professional fees[106]. - Research and development expenses decreased by $187 thousand or 13.6% in the three months ended June 30, 2023, compared to the same period in 2022, but increased by 8.4% in the six months ended June 30, 2023[108]. Future Outlook and Investments - The company anticipates that future gross margin percentages will be influenced by variabilities in costs and potential disruptions from the pandemic[103]. - As of June 30, 2023, the company has Federal net operating loss carry forwards of approximately $59.8 million and state net operating loss carry forwards of approximately $34.2 million available to reduce future taxable income[123]. - A full valuation allowance has been established against the company's net deferred tax assets, indicating that it is more-likely than-not that the benefits from such assets will not be realized[123]. - The company is investing in the acquisition of equipment and fixed assets for current and future manufacturing and research and development facilities[125]. - Upgrades to the company's information technology infrastructure are being made to enhance capabilities and improve overall productivity[125]. - The company is supporting commercialization efforts related to current and future products, including the expansion of its direct sales force and field support resources[125]. - Continued advancement of research and development activities is a priority for the company[125].