Glimpse Group Inc
For the period ended Mar 31, 2024. Filed May 15, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2024 · Filed May 15, 2024
BTLN$3.50+6.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2023-12-31; filed 2024-02-14.
0001493152-24-006634
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2024-03-31; filed 2024-05-15.
0001493152-24-019832
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 72 previous paragraphs and 71 current paragraphs.
35 unchanged; 28 reworded; 8 added; 9 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 7 previous and 7 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (8)
Current report
None.
Current report
Revenue
Current report
For the three months ended March 31, 2024 and 2023, internal staffing was approximately $0.39 million (69% of total cost of goods sold) and approximately $0.73 million (60% of total cost of goods sold), respectively. For the nine months ended March 31, 2024 and 2023, internal staffing was approximately $1.49 million (62% of total cost of goods sold) and approximately $1.99 million (60% of total cost of goods sold), respectively. The increase for both periods reflect Software License/SaaS and non-project Software Services representing a greater percentage of total revenue.
Current report
General and administrative expenses for the three months ended March 31, 2024 were approximately $1.23 million compared to $1.14 million for the three months ended March 31, 2023, an increase of 8%. This is driven by headcount and overhead expense reductions offset by an increase in board compensation reflecting the value of common stock issued in return for cancelling vested stock options. General and administrative expenses for the nine months ended March 31, 2024 were approximately $3.38 million compared to $3.77 million for the nine months ended March 31, 2023, a decrease of 10%. The decrease is driven by Brightline Interactive (“BLI”) acquisition professional fees in the prior year and headcount and overhead expense reductions, offset by an increase in board compensation as described above.
Current report
Intangible asset impairment for the three months ended March 31, 2024 was zero compared to $0.48 million for the three months ended March 31, 2023. Intangible asset impairment for the nine months ended March 31, 2024 was approximately $0.90 million compared to $0.48 million for the nine months ended March 31, 2023. The 2024 expense reflects the divestiture of PulpoAR and the 2023 expense reflects the divestiture of AUGGD.
Current report
Change in fair value of acquisition contingent consideration for the nine months ended March 31, 2024 and 2023 were gains of approximately $4.32 million and approximately $0.68 million, respectively. For both periods, this is driven primarily by changes in the common stock price of Glimpse between measurement dates.
Current report
Net loss for the three months ended March 31, 2024 was $1.54 million, as compared to a net loss of $5.22 million for the comparable 2023 period, a $3.68 million improvement or approximately 70%. This reflects decreased revenue/gross margin offset by a decrease in operating expenses and a gain in change in fair value of acquisition contingent consideration.
Current report
Net loss for the nine months ended March 31, 2024 was $2.40 million, as compared to a net loss of $9.30 million for the comparable 2023 period, a $6.90 million improvement or approximately 74%. This reflects decreased revenue/gross margin and increased intangible asset impairment offset by a decrease in operating expenses and an increased gain in change in fair value of acquisition contingent consideration.
Removed paragraphs (9)
Previous report
Securities Purchase Agreement (“SPA”)
Previous report
On September 28, 2023, the Company entered into a SPA with certain institutional investors to sell 1,885,715 shares of common stock for approximately $3.30 million (at $1.75 per share). The Company realized net proceeds (after underwriting, professional fees and listing expenses) of $2.97 million on October 3, 2023.
Previous report
The SPA shares were issued on October 3, 2023. Simultaneously, the exercise price on warrants to purchase 750,000 shares of common stock originally issued pursuant to a SPA entered into in November 2021 were repriced from $14.63 per share to $1.75 per share.
Previous report
(*) – Includes non cash gains related to fair value change in acquisition contingent consideration liabilities.
Previous report
Revenues
Previous report
For the three months ended December 31, 2023 and 2022, internal staffing was approximately $0.44 million (67% of total cost of revenue) and approximately $0.50 million (58% of total cost of revenue), respectively. The percentage increase reflects an increase in non-project revenue as a percentage of total revenue between the periods. For the six months ended December 31, 2023 and 2022, internal staffing was approximately $1.10 million (60% of total cost of revenue) and approximately $1.25 million (60% of total cost of revenue), respectively. The percentage of revenue is consistent between the periods, as non-project revenue as a percentage of total revenue was also consistent between the periods.
Previous report
General and administrative expenses for the three months ended December 31, 2023 were approximately $1.05 million compared to $1.26 million for the three months ended December 31, 2022, an decrease of approximately 17%. General and administrative expenses for the six months ended December 31, 2023 were approximately $2.14 million compared to $2.64 million for the six months ended December 31, 2022, a decrease of approximately 19%. The decrease for both periods reflects reduction in various professional fees (including 2022 merger and acquisition related to the purchase of BLI and form S-3 filing fees) and facility costs (including office downsizing and write off of S5D right-of-use lease assets).
Previous report
The 2023 $0.90 million expense represents the write-off of goodwill and the net intangible asset attributable to the to divestiture of Pulpo.
Previous report
We sustained a net loss of $0.74 million for the three months ended December 31, 2023 as compared to net income of $1.31 million for the comparable 2022 period, a loss increase of $2.05 million. This reflects decreased revenue and a reduction in gain on change in fair value of acquisition contingent consideration, partially offset by a decrease in other operating expense categories. We sustained a net loss of $0.86 million for the six months ended December 31, 2023 as compared to a net loss of $4.07 million for the comparable 2022 period, a loss decrease of $3.21 million. This reflects decreased revenue and an intangible asset impairment charge, more than offset by a decrease in operating expenses and an increase in the gain on change in fair value of acquisition contingent consideration.
Reworded paragraphs (28)
Previous wording
The following discussion and analysis summarizes the significant factors affecting the consolidated operating results, financial condition, liquidity and cash flows of our Company as of and for the periods presented below. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes included in this Quarterly Report on Form 10-Q and the audited financial statements and notes thereto, and related disclosures, as of and for the year ended June 30, 2023, which are included in the Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on September 28, 2023. Unless the context requires otherwise, references in this Quarterly Report on Form 10-Q to “we,” “us,” “our” or “the Company,” refer to The Glimpse Group, Inc., a Nevada corporation and its subsidiaries.
Current wording
The following discussion and analysis summarizes the significant factors affecting the consolidated operating results, financial condition, liquidity and cash flows of our Company as of and for the periods presented below. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes included in this Quarterly Report on Form 10-Q and the audited financial statements and notes thereto, and related disclosures, as of and for the year ended June 30, 2023, which are included in the Form 10-K filed with the SEC, including the amendment thereto (the “Annual Report on Form 10-K”). Unless the context requires otherwise, references in this Quarterly Report on Form 10-Q to “we,” “us,” “our” or “the Company,” refer to The Glimpse Group, Inc., a Nevada corporation and its subsidiaries.
Previous wording
The information in this discussion contains forward-looking statements and information within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”), which are subject to the “safe harbor” created by those sections. These forward-looking statements include, but are not limited to, statements concerning our strategy, future operations, future financial position, future revenues, projected costs, prospects and plans and objectives of management. The words “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans,” “projects,” “will,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We may not actually achieve the plans, intentions, or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements that we make. These forward-looking statements involve risks and uncertainties that could cause our actual results to differ materially from those in the forward-looking statements, including, without limitation, the risks set forth in Part II, Item 1A, “Risk Factors” in this Quarterly Report on Form 10-Q and in our other filings with the SEC. The forward-looking statements are applicable only as of the date on which they are made, and we do not assume any obligation to update any forward-looking statements.
Current wording
The information in this discussion contains forward-looking statements and information within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which are subject to the “safe harbor” created by those sections. These forward-looking statements include, but are not limited to, statements concerning our strategy, future operations, future financial position, future revenues, projected costs, prospects and plans and objectives of management. The words “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans,” “projects,” “will,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We may not actually achieve the plans, intentions, or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements that we make. These forward-looking statements involve risks and uncertainties that could cause our actual results to differ materially from those in the forward-looking statements, including, without limitation, the risks set forth in Part II, Item 1A, “Risk Factors” in this Quarterly Report on Form 10-Q, in Part I, Item 1A, “Risk Factors” in the Annual Report on Form 10-K, and in our other filings with the SEC. The forward-looking statements are applicable only as of the date on which they are made, and we do not assume any obligation to update any forward-looking statements.
Previous wording
The Immersive technology industry is an early-stage technology industry with nascent markets. We believe that this industry has significant growth potential across verticals, may be transformative and that our diversified platform and ecosystem create important competitive advantages. We focus primarily on the business-to-business (“B2B”) and business-to-business-to-consumer (“B2B2C”) segments industry and we are hardware agnostic.
Current wording
The Immersive technology industry is an early-stage technology industry with nascent markets. We believe that this industry has significant growth potential across verticals, may be transformative and that our diversified platform and ecosystem create important competitive advantages. We focus primarily on the business-to-business (“B2B”) and business-to-business-to-consumer (“B2B2C”) segments industry and we are hardware agnostic. In fiscal year 2024, we commenced on a strategic shift of our businesses focus to providing immersive technology solutions software and services that are primarily driven by Spatial Computing, Cloud and Artificial Intelligence (“Strategic Shift”).
Previous wording
At the time of this filing, we have approximately 120 full time employees, primarily software developers, engineers and 3D artists. Of these, approximately 60 are based in the US and 60 internationally in Turkey.
Current wording
At the time of this filing, we have approximately 115 full time employees, primarily software developers, engineers and 3D artists split about evenly between the United States and Turkey.
Previous wording
We were incorporated as The Glimpse Group, Inc. in the State of Nevada, on June 15, 2016 and are headquartered in New York, New York. We currently own and operate numerous subsidiary companies (“Subsidiary Companies”, “Subsidiaries”) operating under the following business names as represented in the organizational chart below:
Current wording
We were incorporated as The Glimpse Group, Inc. in the State of Nevada, on June 15, 2016 and are headquartered in New York, New York. We currently own and operate numerous subsidiary companies (“Subsidiary Companies” or “Subsidiaries”) operating under the following business names as represented in the organizational chart below:
Previous wording
Financial Highlights for the three and six months ended December 31, 2023 compared to the three and six months ended December 31, 2022
Current wording
Financial Highlights for the three and nine months ended March 31, 2024 compared to the three and nine months ended March 31, 2023
Previous wording
The following table sets forth our results of operations for the three and six months ended December 31, 2023 and 2022:
Current wording
The following table sets forth our results of operations for the three and nine months ended March 31, 2024 and 2023:
Previous wording
Total revenue for the three months ended December 31, 2023 was approximately $2.08 million compared to approximately $2.95 million for the three months ended December 31, 2022, a decrease of 29%. Total revenue for the six months ended December 31, 2023 was approximately $5.18 million compared to approximately $6.9 million for the six months ended December 31, 2022, a decrease of 25%. The decrease for both periods reflects our strategic shift to Spatial Computing, Cloud and AI driven immersive software solutions, which reflects a significant turnover in our targeted customer base.
Current wording
Total revenue for the three months ended March 31, 2024 was approximately $1.9 million compared to approximately $3.67 million for the three months ended March 31, 2023, a decrease of 48%. Total revenue for the nine months ended March 31, 2024 was approximately $7.08 million compared to approximately $10.57 million for the nine months ended March 31, 2023, a decrease of 33%. The decrease for both periods reflects our Strategic Shift, which has resulted in a significant turnover in our historical customer base.
Previous wording
For the three months ended December 31, 2023, Software Services revenue was approximately $2.03 million compared to approximately $2.89 million for the three months ended December 31, 2022, a decrease of approximately 30%. For the six months ended December 31, 2023, Software Services revenue was approximately $5.04 million compared to approximately $6.75 million for the six months ended December 31, 2022, a decrease of approximately 25%. The decrease for both periods reflects our strategic shift to Spatial Computing, Cloud and AI driven immersive software solutions.
Current wording
For the three months ended March 31, 2024, Software Services revenue was approximately $1.47 million compared to approximately $3.12 million for the three months ended March 31, 2023, a decrease of 53%. For the nine months ended March 31, 2024, Software Services revenue was approximately $6.51 million compared to approximately $9.87 million for the nine months ended March 31, 2024, a decrease of 34%. The decrease for both periods reflects our Strategic Shift.
Previous wording
For the three months ended December 31, 2023, Software License revenue was approximately $0.5 million compared to approximately $0.6 million for the three months ended December 31, 2022, a decrease of approximately 17%. For the six months ended December 31, 2023, Software License revenue was approximately $0.14 million compared to approximately $0.15 million for the six months ended December 31, 2022, a decrease of approximately 7%. As the Immersive technology industry continues to mature, we expect our Software License revenue to continue to grow on an absolute basis and as an overall percentage of total revenue.
Current wording
For the three months ended March 31, 2024, Software License revenue was approximately $0.43 million compared to approximately $0.55 million for the three months ended March 31, 2023, a decrease of 22%. For the nine months ended March 31, 2024, Software License revenue was approximately $0.57 million compared to approximately $0.70 million for the nine months ended March 31, 2023, a decrease of 19%. As the Immersive technology industry continues to mature, we expect our Software License revenue to continue to grow on an absolute basis and as an overall percentage of total revenue.
Previous wording
One customer accounted for approximately 28% of the Company’s total gross revenues during the three months ended December 31, 2023. No other customer accounted for greater than 10% of gross revenue. The same customer and a different customer accounted for approximately 55% (29% and 26%, respectively) of the Company’s total gross revenues during the three months ended December 31, 2022. Two customers accounted for approximately 44% (22% and 22%, respectively) of the Company’s total gross revenues during the six months ended December 31, 2023. The same two customers accounted for approximately 58% (32% and 26%, respectively) of the Company’s total gross revenues during the six months ended December 31, 2022.
Current wording
Two customers accounted for approximately 40% (25% and 15%, respectively) of the Company’s total gross revenues during the three months ended March 31, 2024.The same customer and another customer accounted for approximately 39% (23% and 16%, respectively) of the Company’s total gross revenues during the nine months ended March 31, 2024. Two customers accounted for approximately 32% (21% and 11%, respectively) of the Company’s total gross revenues during the three months ended March 31, 2023. The same two customers accounted for approximately 49% (28% and 21%, respectively) of the Company’s total gross revenues during the nine months ended March 31, 2023.
Previous wording
Gross profit was approximately 68% for the three months ended December 31, 2023, compared to approximately 70% for the three months ended December 31, 2022. Gross profit was approximately 64% for the six months ended December 31, 2023 compared to approximately 70% for the six months ended December 31, 2022. The decrease for both periods was driven by the lower margin on project revenue in the current fiscal year due to use of outside contractors.
Current wording
Gross profit margin was approximately 70% for the three months ended March 31, 2024 compared to approximately 67% for the three months ended March 31, 2023. The increase is driven by higher gross margin Software License/SaaS and non-project Software Services representing a greater percentage of total revenue. Gross profit margin was approximately 66% for the nine months ended March 31, 2024 compared to approximately 69% for the nine months ended March 31, 2023. The decrease was driven by the lower margin on project revenue in the current fiscal year due to a larger use of outside contractors.
Previous wording
Operating expenses for the three months ended December 31, 2023 were approximately $2.23 million compared to $0.84 million for the three months ended December 31, 2022, an increase of approximately 165%. This reflects a decrease in all expense categories, reduced investment in non-core areas and divesting non-core assets to align with reduced revenue as a result our strategic shift to Spatial Computing, Cloud and AI driven immersive software solutions, offset by a decrease in the gain on change in fair value of acquisition contingent consideration. Operating expenses for the six months ended December 31, 2023 were approximately $4.33 million compared to $9.01 million for the six months ended December 31, 2022, an decrease of approximately 52%. This reflects a decrease in all expense categories, reduced investment in non-core areas and divesting non-core assets to align with reduced revenue as a result our strategic shift to Spatial Computing, Cloud and AI driven immersive software solutions, and an increase in the gain on change in fair value of acquisition contingent consideration. These were offset by an intangible asset impairment charge.
Current wording
Operating expenses for the three months ended March 31, 2024 were approximately $2.93 million compared to $7.73 million for the three months ended March 31, 2023, a decrease of 62%. This reflects a decrease in primarily all expense categories, reduced investment in non-core areas and divesting non-core assets to align with reduced revenue as a result our Strategic Shift, along with a gain in the change in fair value of acquisition contingent consideration expense. Operating expenses for the nine months ended March 31, 2024 were approximately $7.26 million compared to $16.74 million for the nine months ended March 31, 2023, a decrease of 57%. This reflects a decrease in all expense categories, reduced investment in non-core areas and divesting non-core assets to align with reduced revenue as a result our Strategic Shift, along with an increased gain in the change in fair value of acquisition contingent consideration.
Previous wording
Research and development expenses for the three months ended December 31, 2023 were approximately $1.39 million compared to $2.53 million for the three months ended December 31, 2022, an decrease of approximately 45%. Research and development expenses for the six months ended December 31, 2023 were approximately $3.07 million compared to $4.54 million for the six months ended December 31, 2022, an decrease of approximately 32%. For both periods, this primarily reflects headcount reductions, reduced investment in non-core areas and divesting non-core assets to align with strategic business shift.
Current wording
Research and development expenses for the three months ended March 31, 2024 were approximately $1.14 million compared to $2.16 million for the three months ended March 31, 2023, a decrease of 47%. Research and development expenses for the nine months ended March 31, 2024 were approximately $4.21 million compared to $6.69 million for the nine months ended March 31, 2023, a decrease of 37%. For both periods, this primarily reflects headcount reductions, reduced investment in non-core areas and divesting non-core assets to align with the Strategic Shift.
Previous wording
Sales and marketing expenses for the three months ended December 31, 2023 were approximately $0.77 million compared to $1.74 million for the three months ended December 31, 2022, an decrease of approximately 56%. Sales and marketing expenses for the six months ended December 31, 2023 were approximately $1.58 million compared to $3.48 million for the six months ended December 31, 2022, a decrease of approximately 55%. For both periods, this primarily reflects headcount reductions, reduced investment in non-core areas and divesting non-core assets to align with strategic business shift. In addition, there was a 2023 gain (i.e., expense reduction) in previously accrued, but not yet paid, stock based incentive expense due to a decrease in the fair value of the Company’s common stock between measurement periods.
Current wording
Sales and marketing expenses for the three months ended March 31, 2024 were approximately $0.56 million compared to $1.45 million for the three months ended March 31, 2023, a decrease of 61%. Sales and marketing expenses for the nine months ended March 31, 2024 were approximately $2.14 million compared to $4.94 million for the nine months ended March 31, 2023, a decrease of 57%. For both periods, this reflects headcount reductions, reduced revenue-based incentives, reduced investment in non-core areas and divesting non-core assets to align with the Strategic Shift. In addition, the nine-month 2024 period includes a gain (i.e., expense reduction) in stock based incentive expense due to a decrease in the fair value of the Company’s common stock between measurement periods prior to payment.
Previous wording
Amortization of acquisition intangible assets expense for the three months ended December 31, 2023 was approximately $0.29 million compared to $0.54 million for the three months ended December 31, 2022, a decrease of approximately 46%. Amortization of acquisition intangible assets expense for the six months ended December 31, 2023 was approximately $0.66 million compared to $0.98 million for the six months ended December 31, 2022, a decrease of approximately 33%. The decrease in both periods reflects the write off of acquisition intangible assets related to S5D and Pulpo.
Current wording
Amortization of acquisition intangible assets expense for the three months ended March 31, 2024 was approximately $0.29 million compared to $0.55 million for the three months ended March 31, 2023. Amortization of acquisition intangible assets expense for the nine months ended March 31, 2024 were approximately $0.95 million compared to $1.54 million for the nine months ended March 31, 2023. The decrease in both periods reflects the write off of acquisition intangible assets related to Sector 5 Digital (“S5D”) and PulpoAR.
Previous wording
Change in fair value of acquisition contingent consideration for the three months ended December 31, 2023 was a gain of approximately $1.27 million compared to a gain of $5.23 million for the three months ended December 31, 2022. Change in fair value of acquisition contingent consideration for the six months ended December 31, 2023 was a gain of approximately $4.02 million compared to a gain of $2.63 million for the six months ended December 31, 2022. For all periods, this reflects a decrease in the common stock price of the Company’s stock between the respective measurement periods.
Current wording
Change in fair value of acquisition contingent consideration for the three months ended March 31, 2024 was a gain of approximately $0.29 million compared to an expense of approximately $1.95 million in the 2023 comparable period. The 2024 period gain reflects the removal of the common stock component of BLI contingent consideration based on revenue projections. The 2023 period expense is driven primarily by changes in the common stock price of Glimpse between measurement dates.
Previous wording
The following discussion and analysis includes both financial measures in accordance with Generally Accepted Accounting Principles, or GAAP, as well as non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position or cash flows that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP financial measures should be viewed as supplemental to, and should not be considered as alternatives to, net income (loss), operating income (loss), and cash flow from operating activities, liquidity or any other financial measures. They may not be indicative of the historical operating results of the Company nor are they intended to be predictive of potential future results. Investors should not consider non-GAAP financial measures in isolation or as substitutes for performance measures calculated in accordance with GAAP. Our management uses and relies on EBITDA and Adjusted EBITDA, which are non-GAAP financial measures. We believe that both management and shareholders benefit from referring to the following non-GAAP financial measures in planning, forecasting and analyzing future periods.
Current wording
The following discussion and analysis includes both financial measures in accordance with GAAP, as well as non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position or cash flows that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP financial measures should be viewed as supplemental to, and should not be considered as alternatives to, net income (loss), operating income (loss), and cash flow from operating activities, liquidity or any other financial measures. They may not be indicative of the historical operating results of the Company nor are they intended to be predictive of potential future results. Investors should not consider non-GAAP financial measures in isolation or as substitutes for performance measures calculated in accordance with GAAP. Our management uses and relies on EBITDA and Adjusted EBITDA, which are non-GAAP financial measures. We believe that both management and shareholders benefit from referring to the following non-GAAP financial measures in planning, forecasting and analyzing future periods.
Previous wording
The following table presents a reconciliation of net income (loss) to Adjusted EBITDA loss for the three and six months ended December 31, 2023 and 2022:
Current wording
The following table presents a reconciliation of net loss to Adjusted EBITDA for the three and nine months ended March 31, 2024 and 2023:
Previous wording
Adjusted EBITDA loss of $1.33 million for the three months ended December 31, 2023 compared to a $2.60 million loss for the three months ended December 31, 2022. Adjusted EBITDA loss of $2.60 million for the six months ended December 31, 2023 compared to a $3.64 million loss for the six months ended December 31, 2022. The reduced EBITDA loss for both periods reflects cash expense reductions in excess of the decrease in revenue and gross margin.
Current wording
Adjusted EBITDA loss for the three months ended March 31, 2024 was $0.89 million compared to a loss of $1.13 million for the comparable 2023 period. Adjusted EBITDA loss for the nine months ended March 31, 2024 was $3.50 million compared to a loss of $4.78 million for the comparable 2023 period. The reduced EBITDA loss for both periods reflect cash expense reductions in excess of the decrease in revenue/gross margin.
Previous wording
The Company has incurred recurring losses since its inception, including a net loss of $0.74 million for the three months ended December 31, 2023. In addition, as of December 31, 2023, the Company had an accumulated deficit of $57.50 million. While the Company has been reducing its expense base, it expects to continue to generate negative cash flow for the foreseeable future. The Company expects that its cash and cash equivalents as of December 31, 2023 may not be sufficient to fund operations for at least the next twelve months from the date of issuance of these condensed consolidated financial statements and the Company will need to obtain additional funding. Accordingly, the Company has concluded that substantial doubt exists about the Company’s ability to continue as a going concern for a period of at least 12months from the date of issuance of these condensed consolidated financial statements. Outside of potential revenue growth generated by the Company, in order to alleviate the going concern the Company may take actions which could include but are not limited to: further cost reductions, equity or debt financings and restructuring of potential future cash contingent acquisition liabilities. There is no assurance that these actions will be taken or be successful if pursued.
Current wording
The Company has incurred recurring losses since its inception, including a net loss of approximately $1.5 million for the three months ended March 31, 2024. In addition, as of March 31, 2024, the Company had an accumulated deficit of $59.0 million. While the Company has been reducing its expense base, it expects to continue to generate negative cash flow for the foreseeable future. The Company expects that its cash and cash equivalents as of March 31, 2024 may not be sufficient to fund operations for at least the next twelve months from the date of issuance of these condensed consolidated financial statements and the Company will need to obtain additional funding. Accordingly, the Company has concluded that substantial doubt exists about the Company’s ability to continue as a going concern for a period of at least 12 months from the date of issuance of these condensed consolidated financial statements. Outside of potential revenue growth generated by the Company, in order to alleviate the going concern the Company may take actions which could include but are not limited to, further cost reductions, equity or debt financings and restructuring of potential future cash contingent acquisition liabilities. There is no assurance that these actions will be taken or be successful if pursued.
Previous wording
Potential liquidity resources may include the further sale of common stock pursuant to the unused portion of the $100 million S-3 registration statement filed with the SEC on October 28, 2022. Such financing may not be available on terms favorable to the Company, or at all.
Current wording
Potential liquidity resources may include the further sale of common stock pursuant to the unused portion of the $100 million S-3 registration statement filed with the SEC on October 28, 2022 (subject to SEC I.B.6 or “baby shelf” limitations). Such financing may not be available on terms favorable to the Company, or at all.
Previous wording
Net cash used in operating activities was $3.36 million for the six months ended December 31, 2023, compared to $6.49 million during the prior period, a decrease of $3.13 million. This is driven by a cash operating expense decrease in excess of revenue and gross margin decreases and the absence in 2023 of the decrease in accounts payable and deferred revenue primarily related to the 2022 BLI acquisition.
Current wording
Net cash used in operating activities was $4.28 million for the nine months ended March 31, 2024, compared to $7.60 million during the comparable prior period, a decrease approximately $3.32. This is driven by cash expense reductions in excess of the decrease in revenue/gross margin and positive period over period changes in accounts receivable and deferred revenue.
Previous wording
Net cash used in investing activities for the six months ended December 31, 2023 was negligible compared to approximately $2.60 million in 2022. The 2022 amount primarily represents the cash portion of the BLI acquisition.
Current wording
Net cash used in investing activities for the nine months ended March 31, 2024 was negligible compared to $2.67 million during the comparative prior period. The 2023 amount primarily represents the cash portion of the BLI acquisition.
Previous wording
Cash flow provided from financing activities during the six months ended December 31, 2023 was $ 2.97 million compared to a negligible amount for the prior 2022 period. The 2023 amount represents the net proceeds from the SPA received in October 2023.
Current wording
Net cash provided by financing activities during the nine months ended March 31, 2024 was $2.97 million, compared to a negligible amount for the comparative prior period. The 2024 amount represents the net proceeds from the SPA financing received in October 2023.
Previous wording
As of December 31, 2023, the Company had cash and cash equivalents of $5.22 million, plus $1.25 million of accounts receivable.
Current wording
As of March 31, 2024, the Company had cash and cash equivalents of $4.29 million, plus $0.98 million of accounts receivable.
Previous wording
As of December 31, 2023, contingent consideration for acquisition liabilities contains cash components ranging up to $4.5 million, potentially payable through July 2025 contingent on BLI achieving certain revenue milestones. In the quarter ending March 31, 2024, we expect BLI to achieve a revenue milestone triggering a $1.5 million cash payment.
Current wording
As of March 31, 2024, contingent consideration for acquisition liabilities contains cash components ranging up to $4.5 million, potentially payable through July 2025 contingent on BLI achieving certain revenue milestones. In the quarter ended March 31, 2024, BLI achieved a revenue milestone triggering a $1.5 million cash payment. We anticipate making this payment in the quarter ending June 30, 2024.
Previous wording
Please see Note 3 of the attached December 31, 2023 condensed consolidated financial statements that describe the impact, if any, from the adoption of Recent Accounting Pronouncements.
Current wording
Please see Note 3 to the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q that describes the impact, if any, from the adoption of recent accounting pronouncements.