Upexi(US:UPXI)2023-11-23 17:34Financial Data and Key Metrics Changes - Revenue for fiscal Q1 of 2024 grew 140% year-over-year and 53.5% sequentially, amounting to an increase of approximately $16 million [23][29] - Gross profit increased by approximately $2.9 million compared to the prior year, with $2.1 million of this growth attributed to branded products revenue growth [11] - General and administrative expenses as a percentage of revenue decreased to 8.2% from 19% in the prior year, while operating expenses as a percentage of revenue decreased to 29% from 56.5% [9] Business Line Data and Key Metrics Changes - Re-commerce revenue constituted 76% of total revenue, increasing by 187% year-over-year [26] - Cygnet Online, a high-volume e-commerce provider, saw revenue increase sequentially by approximately $1.5 million, with gross profit margin rising from 44% to 48% [26] - NETi, the re-commerce provider, increased revenue sequentially by approximately $6.3 million, but average gross profit declined from 17% to 10% due to liquidation of excess inventory [27] Market Data and Key Metrics Changes - The company launched its Disney Frozen product on Amazon, achieving a run rate of over 115 units per day and improving its Amazon rank from 20,000 to 4,000 [24] - Tytan Tiles reached 3 in toy magnetic building sets on Amazon shortly after launch, indicating strong market reception [24] Company Strategy and Development Direction - The company is focused on enhancing operational efficiencies and streamlining operations to bolster margins and profitability [4] - There is a strategic pivot towards subscription-based product lines, which are expected to drive higher margins and profitability in the future [7] - The management is committed to generating $100 million in revenue for calendar 2023 while completing cost-cutting measures [9] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges posed by the broader market but remains optimistic about the company's growth trajectory and operational improvements [22] - The company is navigating a dynamic economic landscape and is confident that its strategic initiatives will lead to tangible success in the coming quarters [10] Other Important Information - The company has restructured its seller note and other debts, paying down a portion and extending the remainder, which will not materially impact future operations [28] - Management has implemented cost-cutting measures that are beginning to reflect positively in financial performance [27] Q&A Session Summary Question: How is the company balancing growth versus profitability? - Management indicated that while there has been a focus on growth, particularly with brands like VitaMedica, this has impacted short-term EBITDA margins [13][36] Question: What is the outlook for the credit facility and overall balance sheet? - Management expressed comfort with the credit facility and noted that they are strategically managing debt to ensure sufficient working capital [40][48] Question: Any updates on Bloomios assets? - Management stated that operations at Bloomios are ongoing and are not a drag on the company, contributing positively instead [50]