Glimpse Group Inc
For the period ended Dec 31, 2024. Filed Feb 13, 2025.
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.
Dec 31, 2024 · Filed Feb 13, 2025
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 2024-09-30; filed 2024-11-14.
0001493152-24-045846
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2024-12-31; filed 2025-02-13.
0001493152-25-006263
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 74 previous paragraphs and 73 current paragraphs.
40 unchanged; 16 reworded; 17 added; 18 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 8 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 (17)
Current report
Securities Purchase Agreement
Current report
On December 23, 2024, we closed a registered direct offering pursuant to a securities purchase agreement to which we sold to an institutional investor 1,990,000 shares of our common stock and prefunded warrants to purchase up to 760,000 shares of our common stock. The purchase price for each share of common stock was $2.65 and the purchase price for each prefunded warrant was $2.649 (which was equal to the purchase price per share of common stock, less $0.001).
Current report
The prefunded warrants had an exercise price of $0.001 per share of common stock, became immediately exercisable upon issuance, and were fully exercised in January 2025.
Current report
We realized net proceeds (after placement agent fees and other offering expenses) of $6.79 million from the offering.
Current report
Total revenue for the three months ended December 31, 2024 was approximately $3.17 million compared to approximately $2.08 million for the three months ended December 31, 2023, an increase of 52%. Total revenue for the six months ended December 31, 2024 was approximately $5.61 million compared to approximately $5.18 million for the six months ended December 31, 2023, an increase of 8%. The increase for both periods reflects a new Spatial Core customer, with the six month 2023 period also including revenue of certain legacy non-Spatial core customers.
Current report
For the three months ended December 31, 2024, Software Services revenue was approximately $3.13 million compared to approximately $2.03 million for the three months ended December 31, 2023, an increase of approximately 54%. For the six months ended December 31, 2024, Software Services revenue was approximately $5.36 million compared to approximately $5.04 million for the six months ended December 31, 2023, an increase of approximately 6%. The increase for both periods reflects a new Spatial Core customer, with the six month 2023 period also including revenue of certain legacy non-Spatial core customers.
Current report
Gross profit margin was approximately 64% for the three months ended December 31, 2024, compared to approximately 68% for the three months ended December 31, 2023. This decrease reflects a change in revenue mix where project related comparatively lower margin revenue represented a greater portion of total revenue than higher margin recurring revenue. Gross profit margin was approximately 70% for the six months ended December 31, 2024 compared to approximately 64% for the six months ended December 31, 2023. The increase reflects higher project margin in the current period reflecting greater use of internal staffing.
Current report
For the three months ended December 31, 2024 and 2023, internal staffing was approximately $0.86 million (75% of total cost of revenue) and approximately $0.44 million (67% of total cost of revenue), respectively. For the six months ended December 31, 2024 and 2023, internal staffing was approximately $1.28 million (77% of total cost of revenue) and approximately $1.10 million (60% of total cost of revenue), respectively. The percentage increase reflects our strategic shift to Spatial Core and less reliance on third party, higher cost suppliers.
Current report
Operating expenses for the three months ended December 31, 2024 were approximately $2.02 million compared to approximately $2.23 million for the three months ended December 31, 2023, a decrease of approximately 9%. Operating expenses for the six months ended December 31, 2024 were approximately $4.97 million compared to approximately $4.33 million for the six months ended December 31, 2023, an increase of approximately 15%. Excluding the change in fair value of acquisition contingent consideration and intangible asset impairment, operating expenses decreased 43% and 34% for the three and six months ended December 31, 2024 compared to the comparable periods in 2023. The decrease reflects our Strategic Shift and reduction in non core businesses.
Current report
Research and development expenses for the three months ended December 31, 2024 were approximately $0.66 million compared to $1.39 million for the three months ended December 31, 2023, a decrease of approximately 53%. Research and development expenses for the six months ended December 31, 2024 were approximately $1.78 million compared to $3.07 million for the six months ended December 31, 2023, a decrease of approximately 42%.The decreases for both periods reflect the divestiture of QReal/Turkey, more efficient use of headcount (portion that is allocated to cost of goods sold) and other headcount reductions as part of our Strategic Shift.
Current report
General and administrative expenses for the three months ended December 31, 2024 were approximately $0.85 million compared to approximately $1.05 million for the three months ended December 31, 2023, a decrease of approximately 19%. General and administrative expenses for the six months ended December 31, 2024 were approximately $1.78 million compared to approximately $2.14 million for the six months ended December 31, 2023, a decrease of approximately 17%. The decreases for both periods reflect the divestiture of QReal/Turkey, headcount reductions as part of our Strategic Shift, and certain corporate administrative cost reductions.
Current report
Sales and marketing expenses for the three months ended December 31, 2024 were approximately $0.38 million compared to approximately $0.77 million for the three months ended December 31, 2023, a decrease of approximately 51%. Sales and marketing expenses for the six months ended December 31, 2024 were approximately $1.12 million compared to approximately $1.57 million for the six months ended December 31, 2023, a decrease of approximately 29%. The decrease for both periods reflect the divestiture of Qreal/Turkey, partially offset by an increase in incentive pay related to the increase in revenue.
Current report
Other Income
Current report
Other income was approximately $0.01 million and $0.07 million, respectively, for the three months ended December 31, 2024 and 2023. Other income was approximately $0.04 million and $0.13 million, respectively, for the six months ended December 31, 2024 and 2023. This income represents interest income and the decreases in 2024 reflect reduced cash balances.
Current report
Net income for the three months ended December 31, 2024 was approximately $0.02 million compared to a loss of approximately $0.74 million for the comparable 2023 period. This improvement reflects our Strategic Shift and reduction in non core businesses. Net loss for the six months ended December 31, 2024 and 2023 was approximately $0.98 million and $0.86 million, respectively. Excluding the gain from change in fair value of acquisition contingent consideration and intangible asset impairment in 2023 (see Operating Expenses section above), the loss in 2023 was approximately $3.97 million, and the reduction in loss based on this comparison reflects our Strategic Shift and reduction in non core businesses.
Current report
Adjusted EBITDA income was $0.28 million for the three months ended December 31, 2024 compared to a $1.33 million loss for the three months ended December 31, 2023. Adjusted EBITDA loss was $0.17 million for the six months ended December 31, 2024 compared to a $2.61 million loss for the six months ended December 31, 2023. The improvement in both periods reflects our Strategic Shift and reduction in non core businesses.
Current report
Net cash provided by financing activities during the six months ended December 31, 2024 was approximately $6.87 million compared to approximately $2.97 million during the six months ended December 31, 2023. Both periods represent proceeds of securities purchase agreements entered into with institutional investors.
Removed paragraphs (18)
Previous report
Total revenue for the three months ended September 30, 2024 was approximately $2.44 million compared to approximately $3.10 million for the three months ended September 30, 2023, a decrease of approximately 21%. The decrease reflects our Strategic Shift, which has resulted in a significant turnover in our historical customer base and the divestiture of, and consolidation of, several of our entities.
Previous report
For the three months ended September 30, 2024, Software Services revenue was approximately $2.23 million compared to approximately $3.01 million for the three months ended September 30, 2023, a decrease of approximately 26%. The decrease reflects our Strategic Shift and the divestiture of, and consolidation of, several of our entities.
Previous report
Gross profit was approximately 79% for the three months ended September 30, 2024 compared to approximately 62% for the three months ended September 30, 2023. The increase was driven by our Strategic Shift, which is less reliant on outside contractors’ costs and higher Software License revenues.
Previous report
For the three months ended September 30, 2024 and 2023, internal staffing was approximately $0.43 million (83% of total cost of goods sold) and approximately $0.65 million (55% of total cost of goods sold), respectively. The increase in internal staffing as a percentage of total cost of goods sold was due to our Strategic Shift.
Previous report
Operating expenses for the three months ended September 30, 2024 were approximately $2.96 million compared to approximately $2.09 million for the three months ended September 30, 2023, an increase of approximately 42%. The increase reflects expense reductions driven by reduced revenue and non-strategic business divestitures more than offset by the non-cash 2023 gain in change in fair value of acquisition contingent consideration not occurring in 2024.
Previous report
Research and development expenses for the three months ended September 30, 2024 were approximately $1.12 million compared to approximately $1.68 million for the three months ended September 30, 2023, a decrease of approximately 33%. This decrease represents expense reductions, primarily headcount related, driven by reduced revenue and non-strategic business divestitures.
Previous report
General and administrative expenses for the three months ended September 30, 2024 were approximately $0.94 million compared to approximately $1.10 million for the three months ended September 30, 2023, a decrease of approximately 15%. The decrease was driven by headcount reductions along with reduced corporate overhead expenses.
Previous report
Sales and marketing expenses for the three months ended September 30, 2024 were approximately $0.74 million compared to approximately $0.81 million for the three months ended September 30, 2023, a decrease of approximately 9%. This decrease represents expense reductions, primarily headcount related, driven by reduced revenue and non-strategic business divestitures. This is partially offset by a 2023 non-cash gain in the change in fair value of stock-based incentive compensation not occurring in 2024.
Previous report
Net loss for the three months ended September 30, 2024 and 2023 was approximately $1.02 million and $0.12 million, respectively, a loss increase of approximately $0.90 million. This reflects the 2023 non-cash gain in the change in fair value of acquisition contingent consideration not occurring in 2024 partially offset by expense reductions driven by reduced revenue and non-strategic business divestitures.
Previous report
Adjusted EBITDA loss was $0.46 million for the three months ended September 30, 2024 compared to $1.29 million loss for the three months ended September 30, 2023. This improvement reflects expense reductions, primarily headcount related, driven by reduced revenue and non-strategic business divestitures.
Previous report
Going Concern
Previous report
The Company evaluated whether there are conditions and events, considered in the aggregate, that raise doubt about its ability to continue as a going concern within one year after the date that these condensed consolidated financial statements are issued. This evaluation initially does not take into consideration the potential mitigating effect of management’s plans that have not been fully implemented as of the date the financial statements are issued.
Previous report
The Company has incurred recurring losses since its inception, including a net loss of $1.02 million for the three months ended September 30, 2024. In addition, as of September 30, 2024, the Company had an accumulated deficit of $64.05 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 September 30, 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.
Previous report
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 report
The condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of the uncertainties described.
Previous report
Potential liquidity resources
Previous report
Potential liquidity resources may include the further sale of common stock pursuant to the unused portion of the Company’s $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.
Reworded paragraphs (16)
Previous wording
We are an Immersive technology company, providing enterprise focused Virtual Reality (VR), Augmented Reality (AR) and Spatial Computing software and services. Glimpse’s operating entities are located primarily in the United States. We believe that we offer significant exposure to the rapidly growing and potentially transformative Immersive technology markets, while mitigating downside risk via our diversified model and ecosystem.
Current wording
We are an Immersive technology company, providing enterprise focused Virtual Reality (VR), Augmented Reality (AR) and Spatial Computing software and services (Immersive technologies). Glimpse’s operating entities are located primarily in the United States. We believe that we offer significant exposure to the rapidly growing and potentially transformative Immersive technology markets, while mitigating downside risk via our diversified model and ecosystem.
Previous wording
In fiscal year 2024, we shifted our businesses focus to providing immersive technology solutions software and services (“Strategic Shift”) that are primarily driven by Spatial Computing, Cloud and Artificial Intelligence (AI), which we refer to as “Spatial Core.” While this transition is still ongoing, we believe that Spatial Core is a key differentiator, growth driver and competitive advantage for us.
Current wording
In fiscal year 2024, we shifted our businesses focus to providing immersive technology solutions software and services (the “Strategic Shift”) that are primarily driven by Spatial Computing, Cloud and Artificial Intelligence (AI), which we refer to as “Spatial Core.” We believe that Spatial Core is a key differentiator, growth driver and competitive advantage for us.
Previous wording
Subsequent to period end, as part of our strategic realignment around Spatial Core and divestiture of non-core assets, on October 7, 2024 the Company announced that, effective on October 1, 2024, it had entered into an agreement to divest the business of its wholly owned subsidiary company QReal, LLC (“QReal”) and its related operating entity GLIMPSE GROUP YAZILIM VE ARGE TİCARET ANONİM ŞİRKET in a management buyout by then General Manager of QReal (the “Divestiture”).
Current wording
As part of our strategic realignment around Spatial Core and divestiture of non-core assets, effective October 1, 2024 we divested the business of our then wholly owned entities QReal, LLC (“QReal”) and its related operating entity GLIMPSE GROUP YAZILIM VE ARGE TİCARET ANONİM ŞİRKET (“Turkey”) in a management buyout by the general manager of QReal (the “Divestiture”).
Previous wording
Pursuant to the Divestiture, we retain the contract and resulting revenues from QReal’s largest customer in full until such time that we have collected and retained $1.35 million net cash in the aggregate, after taking into account all related operating expenses and fees (the “Milestone”). After satisfaction of the Milestone, we will receive a monthly cash revenue share for a period of 18 months in relation to any revenues generated from this same customer. In connection with the Divestiture, we were also issued (i) a $1.56 million senior secured convertible note in the new independent entity and (ii) a minority equity stake in the new independent entity. Principal payback on the senior secured convertible note is tied directly to revenue collected by the new entity (separate from the Milestone).
Current wording
Pursuant to the Divestiture, we retain the contract and resulting revenues from QReal’s largest customer in full until such time that we have collected and retained $1.35 million net cash in the aggregate, after taking into account all related operating expenses and fees (the “Milestone”). After satisfaction of the Milestone, we will receive a monthly cash revenue share for a period of 18 months in relation to any revenues generated from this same customer. In connection with the Divestiture, we were also issued (i) a $1.56 million senior secured convertible note in the new independent entity and (ii) a minority equity stake in the new independent entity. Principal payback on the senior secured convertible note is currently considered remote and is tied directly to revenue collected by the new entity (separate from the Milestone).
Previous wording
Financial Highlights for the three months ended September 30, 2024 compared to the three months ended September 30, 2023.
Current wording
Financial Highlights for the three and six months ended December 31, 2024 compared to the three and six months ended December 31, 2023.
Previous wording
The following table sets forth our results of operations for the three months ended September 30, 2024 and 2023:
Current wording
The following table sets forth our results of operations for the three months and six months ended December 31, 2024 and 2023:
Previous wording
For the three months ended September 30, 2024, Software License revenue was approximately $0.21 million compared to approximately $0.09 million for the three months ended September 30, 2023. The increase was due to the addition of one significant customer in 2024.
Current wording
For the three months ended December 31, 2024, Software License revenue was approximately $0.04 million compared to approximately $0.05 million for the three months ended December 31, 2023, essentially flat period over period. For the six months ended December 31, 2024, Software License revenue was approximately $0.25 million compared to approximately $0.14 million for the six months ended December 31, 2023, an increase of 79%. The increase reflects the addition of a new customer.
Previous wording
Two customers accounted for approximately 57% (29% and 28%, respectively) of the Company’s total gross revenues during the three months ended September 30, 2024. One of the same customers and a different customer accounted for approximately 50% (33% and 17%, respectively) of the Company’s total gross revenues during the three months ended September 30, 2023.
Current wording
Three customers accounted for approximately 80% (56%, 14% and10%, respectively) of the Company’s total gross revenues during the three months ended December 31, 2024. One of the same customers accounted for approximately 28% of the Company’s total gross revenues during the three months ended December 31, 2023. Two customers accounted for approximately 65% (44% and 21%, respectively) of the Company’s total gross revenues during the six months ended December 31, 2024.One of the same customers and another customer accounted for approximately 44% (22% and 22%, respectively) of the Company’s total gross revenues during the six months ended December 31, 2023.
Previous wording
Amortization of acquisition intangible assets expense for the three months ended September 30, 2024 was approximately $0.13 million compared to approximately $0.37 million for the three months ended September 30, 2023, a decrease of approximately 65%. The decrease is attributable to the write off in the prior fiscal year of certain customer relationship intangible assets and divestiture of a certain entity.
Current wording
Amortization of acquisition intangible assets expense for the three months ended December 31, 2024 was approximately $0.10 million compared to approximately $0.29 million for the three months ended December, 2023, a decrease of approximately 66%. Amortization of acquisition intangible assets expense for the six months ended December 31, 2024 was approximately $0.23 million compared to approximately $0.66 million for the six months ended December, 2023, a decrease of approximately 65%. The decrease for both periods is attributable to the write off of BLI intangible assets – legacy customer relationships in June 2024.
Previous wording
Intangible asset impairment for the three months ended September 30, 2024 was zero compared to approximately $0.89 million for the three months ended September 30, 2023. The 2023 impairment represents the write-off of goodwill and the net intangible asset - technology attributable to the divestiture a certain entity.
Current wording
The $0.01 million and $0.90 million impairment for the three and six months ended December 31, 2023 represents the write-off of goodwill and the net intangible asset - technology attributable to the divestiture of PulpoAR, LLC.
Previous wording
Change in fair value of acquisition contingent consideration for the three months ended September 30, 2024 was a expense of approximately $0.03 million compared to a gain of approximately $2.76 million for the three months ended September 30, 2023. The expense for the three months ended September 30, 2024 represents the change in the present value of BLI cash contingent consideration. The gain in 2023 was driven by a decrease in the common stock price of Glimpse between measurement dates related to BLI and S5D contingent consideration measured in Company stock.
Current wording
Change in fair value of acquisition contingent consideration for the three months ended December 31, 2024 was an expense of approximately $0.03 million compared to a gain of $1.28 million for the three months ended December 31, 2023. Change in fair value of acquisition contingent consideration for the six months ended December 31, 2024 was an expense of approximately $0.06 million compared to a gain of $4.01 million for the six months ended December 31, 2023. The expense in 2024 represents the change in the time value of money related to the present value of future consideration payments related to the BLI acquisition. The gain in 2023 was driven by revisions to revenue forecasts and a decrease 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 (“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 aforementioned 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 Generally Accepted Accounting Principles (“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), 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 aforementioned non-GAAP financial measures in planning, forecasting and analyzing future periods.
Previous wording
The following table presents a reconciliation of net loss to Adjusted EBITDA for the three months ended September 30, 2024 and 2023:
Current wording
The following table presents a reconciliation of net loss to Adjusted EBITDA for the three and six months ended December 31, 2024 and 2023:
Previous wording
Net cash used in operating activities was approximately $0.42 million for the three months ended September 30, 2024, compared to approximately $1.68 million during the three months ended September 30, 2023, an improvement of approximately $1.26 million. This was driven by expense reductions, primarily headcount related, driven by reduced revenue and non-strategic business divestitures.
Current wording
Net cash used in operating activities was approximately $0.25 million for the six months ended December 31, 2024, compared to approximately $3.36 million during the six months ended December 31, 2023, an improvement of approximately $3.11 million. This was driven primarily driven by improved profit margins and expenses reductions reflective of our Strategic Shift and reduction in non core businesses.
Previous wording
Net cash used in investing activities for the three months ended September 30, 2024 was approximately $0.01 million, consistent compared to the 2023 period.
Current wording
Net cash used in investing activities for the six months ended December 31, 2024 was approximately $0.03 compared to a $0.01 million during the comparable 2023 period. Both periods represent minimal fixed asset additions.
Previous wording
As of September 30, 2024, the Company had cash and cash equivalents of $1.41 million, plus $0.87 million of accounts receivable.
Current wording
As of December 31, 2024, the Company had cash and cash equivalents of $8.45 million.