SONIM TECHNOLOGIES INC
For the period ended Mar 31, 2025. Filed May 12, 2025.
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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, 2025 · Filed May 12, 2025
SONM$2.13-7.4%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 2024-11-13.
0001493152-24-045139
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-12.
0001641172-25-009749
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 81 previous paragraphs and 64 current paragraphs.
35 unchanged; 16 reworded; 12 added; 30 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 2 previous and 3 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 (12)
Current report
During the second half of 2024 and through the filing date of this report, Sonim launched the following products:
Current report
Additionally, the XP10 is now available through our distribution partners in EMEA and Australia. Most of these products are supported by the SonimWare platform and enterprise services. In the first quarter of 2025, the XP Pro 5G and H500 5G each received Verizon Frontline certification. In the first quarter of 2025 we also announced the upcoming launch and availability of the XP Pro Thermal 5G smartphone for Europe which includes an SDK-enabled Sonim IRIS software for custom application development and an integrated thermal camera by FLIR® that benefits a number of vertical trades such as electricians, plumbers, public safety, construction, agriculture, amongst others.
Current report
Promissory Note
Current report
On February 21, 2025, the Company entered into the Purchase Agreement with the Lender pursuant to which the Company issued and sold to the Lender the Note. Starting on August 21, 2025, the Lender may exercise its right to redeem up to $330,000 of the Note per calendar month. If the Lender exercises this right, the Company’s liquidity will decrease. For additional information, refer to Note 4 — Promissory Note to the condensed consolidated financial statements contained within this report.
Current report
Macroeconomic Events
Current report
Worldwide economic and political uncertainties and negative trends, including tariffs and increasing trade protectionism, inflation, tensions between the U.S. and China, financial and credit market fluctuations, recession risks, labor shortages, supply chain disruptions, political election cycles, changes in laws and interpretations of laws, changes in the volume and relative mix of U.S. government spending, cost-cutting and efficiency initiatives and potential disruptions from international conflicts and acts of terrorism, have impacted and may continue to impact our business and the business of our customers, while also disrupting sales channels and advertising and marketing activities. See “Part II. Item 1A. Risk Factors” in this Form 10-Q for further discussion of the possible impact of these factors and other risks on our business.
Current report
We have implemented and continue to implement measures to address those challenges. We also continue to actively manage our inventory and establish a relationship with third-party manufacturers in an effort to minimize supply chain disruptions. Nevertheless, the above-described events had and will continue to impact the global macroeconomic and geopolitical environments, capital and commodity markets, and global supply chains, which may have an adverse impact on our operations and hinder our ability to access capital, if needed. Our cost of revenue may increase if the component prices increase.
Current report
Total net revenues for the three months ended March 31, 2025, decreased slightly by $0.1 million compared to 2024. The three months ended March 31, 2025, included $5.3 million related to the expiration of customer allowance agreements as three of our legacy phones approach end-of-life. The three months ended March 31, 2024, included $7.7 million in revenue from white label products sold to a related party. We discontinued our white label program during the first quarter of 2024. Sales of our feature phones increased $1.5 million period over period and hotspot sales from products that were launched after the first quarter of 2024 were $0.7 million in 2025. Excluding the impact of the expiration of customer allowance agreements mentioned above, we expect revenue to increase significantly in the second quarter of 2025 due to increasing sales of our hotspots in the U.S. and our phones in EMEA.
Current report
Cost of revenues for the three months ended March 31, 2025, decreased by $5.5 million as compared to 2024. The first quarter of 2024 included white label phones with cost of revenues of $7.2 million. The decrease resulting from the loss of this revenue was partially offset by higher cost of revenues in the first quarter 2025 because of higher revenue from feature phones and hotspots.
Current report
Gross profit for the three months ended March 31, 2025, increased by $5.5 million compared to 2024 because of the $5.3 million adjustment to revenue from the expiration of customer allowance agreements in the first quarter of 2025. Gross margin for the three months ended March 31, 2025, was 50%, which reflects the positive impact from the expiration of customer allowance agreements that has no related cost of sales, compared to 17% in the first quarter of 2024, which reflects the negative impact of white label products that had a gross margin of approximately 6%.
Current report
Historically, we have funded operations from a combination of public and private equity financings, and through the issuance of debt. During the first quarter of 2025 we received net proceeds of $3.5 million from the sale of our stock through our ATM program, and we received net proceeds of $2.8 million from the issuance of the Note.
Removed paragraphs (30)
Previous report
As of the filing of this 10-Q, our recent product launches in Q3 and Q4 include the Sonim H500 series of mobile hotspots available through UScellular, Bell, and Verizon in the U.S. and Canada; the Sonim H700 mobile hotspot with Telstra in Australia; and the XP100 professional rugged phone in Europe available via distribution partners. Additionally, the XP10 is now available in EMEA and Australia, all supported by the comprehensive SonimWare platform and enterprise services.
Previous report
During the first half of 2024, the Company was in a transition period, phasing out low margin white label products and commencing selling new products through our carrier channels. Our strategy of moving away from the white label business was accelerated when our manufacturing partners had difficulty maintaining production of our white label products. Revenue in the third quarter of 2024 decreased compared to the third quarter of 2023 due to this transition away from white label products. However, with the launch of new products in the fourth quarter of 2024 and in the first half of 2025, we anticipate significant revenue growth and improved profitability.
Previous report
During the three and nine months ended September 30, 2024, net revenues were primarily generated from sales of our mobile phones and industrial-grade accessories, predominantly to wireless carriers in the United States and Canada. During the three and nine months ended September 30, 2023, white label tablets revenue comprised a significant portion of our revenue. During the three months ended September 30, 2024, no white label products were sold. The white label products sold in 2023 and the first quarter of 2024 had lower margins compared to Sonim’s other offerings.
Previous report
Reverse Stock Split
Previous report
On July 17, 2024, the Company effected a 1-for-10 reverse stock split of its issued and outstanding common stock (the “Reverse Stock Split”). Our common stock began trading on the Nasdaq Capital Market on a post-split basis on July 18, 2024. As a result of the Reverse Stock Split, each share of common stock issued and outstanding immediately prior to July 18, 2024, was automatically converted into one-tenth (1/10) of a share of common stock. The Reverse Stock Split affected all common stockholders uniformly and did not alter any stockholder’s percentage interest in the Company’s equity, except to the extent that the Reverse Stock Split would result in a stockholder owning a fractional share. No fractional shares were issued in connection with the Reverse Stock Split. Stockholders who otherwise would be entitled to receive a fractional share instead were entitled to receive one whole share in lieu of such fractional share.
Previous report
The Reverse Stock Split did not change the par value of the common stock or the authorized number of shares of common stock. All outstanding stock options, restricted stock units, and warrants entitling their holders to purchase or obtain or convert into shares of our common stock were adjusted, as required by the terms of these securities.
Previous report
All common share and per-share amounts in this Form 10-Q have been retroactively restated to reflect the effect of the Reverse Stock Split.
Previous report
Impairment of Contract Fulfillment Assets
Previous report
The non-recurring costs associated with design and development of new products for technical approval represent costs to fulfill a contract pursuant to ASC 340-40,Other Assets and Deferred Costs. Accordingly, the Company capitalizes these contract fulfillment costs and amortizes such costs over the estimated period of time that the product will be sold, which is typically three to four years. As of September 30, 2024, and December 31, 2023, the net contract fulfillment assets were $12,063 and $9,232, respectively.
Previous report
If the Company determines that such contract fulfillment costs are not expected to be recovered, it records an impairment in the period such determination is made. During the nine months ended September 30, 2024, the Company recorded an impairment of contract fulfillment assets of $3,217 due to a decrease in projected profit of one of its hotspots and the cancellation of a consumer durable product. This product was cancelled because higher than anticipated manufacturing costs eliminated the expected profit margin on the product.
Previous report
Compliance with Nasdaq Listing Rules
Previous report
On September 14, 2023, the Company received a letter from the Listing Qualifications Department (the “Staff”) of The Nasdaq Stock Market, LLC (“Nasdaq”) notifying it that, because the bid price for its common stock had fallen below $1.00 per share for 30 consecutive business days, the Company no longer complied with the $1.00 minimum bid price requirement set forth in Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Rule”) for continued listing. On August 2, 2024, the Company received a letter from the Staff notifying the Company that it had regained compliance with the Bid Price Rule.
Previous report
Total net revenues for the three months ended September 30, 2024, decreased by $12.5 million compared to 2023 because 2023 included $13.9 million in revenue from the white label tablets and the tablet sales ended in the fourth quarter of 2023. The Company had planned to exit the white label business in 2024 but our strategy of moving away from the white label business was accelerated when our manufacturing partners had difficulty maintaining production of our white label products. The 2024 year has been a transition period, marked by the ending of our white label business and the start of the launches of our hotspots and new rugged smartphone. Revenue is expected to increase in 2025 as we launch new products.
Previous report
Total net revenues for the nine months ended September 30, 2024, decreased by $36.9 million compared to 2023 because 2023 had $43.9 million in white label tablet revenue, which was partially offset by $7.7 million in white label phone related party revenue in the first quarter of 2024. The Company’s 2024 strategy of moving away from the white label business was accelerated when our manufacturing partners had difficulty maintaining production of our white label products. Revenue is expected to increase in 2025 as new products are launched with additional carriers and distributors.
Previous report
Cost of revenues for the three months ended September 30, 2024, decreased by $11.2 million as compared to 2023 primarily due to the decrease in net revenues. Cost of revenues as a percentage of net revenue decreased because 2024 did not have any lower margin white label products.
Previous report
Cost of revenues for the nine months ended September 30, 2024, decreased by $32.8 million as compared to 2023 primarily due to the decrease in net revenues. Cost of revenues as a percentage of net revenue decreased because white label revenue decreased from $43.9 million in 2023 to $7.7 million in 2024, and white label products have much lower margins.
Previous report
Gross profit for the three months ended September 30, 2024, decreased by $1.4 million, while the gross margin percentage increased by 6%, compared to 2023. The increase in gross profit percentage was because there was no white label revenue with its lower margins in 2024.
Previous report
Gross profit for the nine months ended September 30, 2024, decreased by $4.1 million, while the gross margin percentage increased by 8%, compared to 2023. The increase in gross profit was because 2023 had more low margin white label revenue.
Previous report
Research and development (“R&D”) expenses for the three months ended September 30, 2024, were flat compared to 2023.
Previous report
Sales and marketing expenses for the nine months ended September 30, 2024, increased by $3.0 million compared to 2023 primarily due to an increase in marketing spend to support new products in 2024 and to capture new business opportunities across Europe as a result of the ceased operations of a competitor, as well as an increase in headcount primarily to support sales in Europe.
Previous report
General and administrative expenses for the nine months ended September 30, 2024, increased by $2.1 million compared to 2023 primarily due to an increase in personnel and consulting expenses, including stock-based compensation, an increase in public company filing activity that required additional legal costs and auditor fees, and an increase in the accrual for employee bonuses.
Previous report
Impairment of Contract Fulfillment Assets
Previous report
Impairment of contract fulfillment assets for the nine months ended September 30, 2024, was $3.2 million, resulting from the Company’s determination that it would not recover the contract fulfillment costs capitalized due to a decrease in projected profit for one of its hotspots and the cancellation of the consumer durable product.
Previous report
Historically, we have funded operations from a combination of public and private equity financings, convertible loans from existing investors and borrowings under loan agreements. As of September 30, 2024, we did not have any convertible loans or any other borrowing structures in place.
Previous report
Currently, our principal source of liquidity consists of cash and cash equivalents totaling $9.1 million, as of September 30, 2024. On April 29, 2024, we received $3.8 million in cash, net of issuance costs, from an investor for the purchase of the Company’s shares and the issuance of warrants. Additionally, we may elect to sell shares of common stock under our “at the market” offering program, as described in detail under the title “ATM Offering.” We also have access to up to $2.5 million available under the Receivables Financing Agreement. We plan to continue to leverage multiple sources of liquidity to maintain flexibility in regard to meeting our capital needs.
Previous report
The accompanying condensed consolidated financial statements have been prepared on a going concern basis which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. Cash and cash equivalents as of September 30, 2024, were $9.1 million.
Previous report
For the nine months ended September 30, 2023, cash provided by financing activities was $0.3 million, primarily due to $0.4 million in proceeds from the exercise of employee stock options, partially offset by the repayment of debt.
Previous report
JOBS Act
Previous report
We are an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. We elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. We expect to use the extended transition period for any other new or revised accounting standards during the period in which we remain an emerging growth company. As a result, our condensed consolidated financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.
Previous report
We will remain an emerging growth company until the earliest of (i) December 31, 2024 (the last day of the fiscal year following May 14, 2024, the fifth anniversary of the consummation of our initial public offering), (ii) the last day of the fiscal year in which we have total annual gross revenue of at least $1.235 billion, (iii) the last day of the fiscal year in which we are deemed to be a “large accelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which would occur if the market value of our common stock held by non-affiliates exceeded $700 million as of the last business day of the second fiscal quarter of such year, or (iv) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. Even after we no longer qualify as an emerging growth company, we may still qualify as a smaller reporting company, which would allow us to take advantage of many of the same exemptions from disclosure requirements, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended, and reduced disclosure obligations regarding executive compensation in our prospectuses and in our periodic reports and proxy statements.
Reworded paragraphs (16)
Previous wording
Sonim Technologies, based in the United States, is a leading provider of enterprise 5G solutions, offering a robust portfolio that includes rugged handsets, smartphones, wireless internet devices, software, services, and accessories. These products are engineered for reliable communication in challenging and unpredictable environments, serving sectors such as critical communications, first responders, government, industrial, construction, hospitality, and logistics. We currently have products available at all three U.S. Tier-one carriers – AT&T, T-Mobile and Verizon as well as the three primary carriers in Canada – Bell, Telus and Rogers, and Telstra in Australia. These carriers then resell our products, along with network services, to end customers focusing on two primary end markets: industrial enterprise and public sector.
Current wording
Sonim Technologies, based in the United States, is a leading provider of enterprise 5G solutions, offering a robust portfolio that includes rugged handsets, smartphones, wireless internet devices, software, services, and accessories. These products are engineered for reliable communication in challenging and unpredictable environments, serving sectors such as critical communications, first responders, government, industrial, construction, hospitality, and logistics. We currently have products available at all three U.S. Tier-one carriers – AT&T, T-Mobile and Verizon as well as the three primary carriers in Canada – Bell, Telus and Rogers, and Telstra in Australia. These carriers then resell our products, along with network services, to end customers focusing on two primary end markets: industrial enterprise and public sector. We also sell our products through distributors and resellers in various markets, including Europe and South Africa.
Previous wording
In 2023, Sonim announced a strategic expansion initiative, focusing on broadening its market reach with new products, geographical markets, and customer segments including enterprise, small and medium business, and prosumers. This strategy is underpinned by a strong emphasis on execution. We have introduced new product categories: Connected Solutions featuring wireless internet products, a next-generation rugged smartphone, and a new range of mid and low-tier professional rugged phones, all boasting IP68, MIL-STD-810H standards, and elements of Sonim’s Rugged Performance Standards (RPS), highlighting our value proposition to target markets.
Current wording
In 2023, Sonim announced a strategic expansion initiative, focusing on broadening its market reach with new products, geographical markets, and customer segments including enterprise, small and medium business, and prosumers. This strategy is underpinned by a strong emphasis on execution. We have introduced new product categories: Connected Solutions featuring wireless internet products, a next-generation rugged smartphone, and a new range of mid and low-tier professional rugged phones, all boasting IP ratings, MIL-STD-810H standards, and elements of Sonim’s RPS, highlighting our value proposition to target markets.
Previous wording
With the primary sales channels in the U.S. and Canada consisting of large wireless carriers, the Company’s customer base is highly concentrated. For the nine months ended September 30, 2024, wireless carriers contributed 73% of our total net revenues, with our top three carrier customers accounting for 59% of our total net revenues. Our rugged smartphones represented 46% of our total net revenues, while feature phones were 34% of our total net revenues and white label phones (related party revenue) were 18% of our total net revenues. For the three months ended September 30, 2024, wireless carriers contributed 82% of our total net revenues, with our top three carrier customers accounting for 62% of our total net revenues. Our rugged smartphones represented 53% of our total net revenues, while feature phones were 45% of our total net revenues.
Current wording
With the primary sales channels in the U.S. and Canada consisting of large wireless carriers, the Company’s customer base is highly concentrated. For the three months ended March 31, 2025, wireless carriers contributed 84% of our total net revenues, 32% of which related to the expiration of customer allowance agreements as three of our legacy phones approach end-of-life, with our top three carrier customers accounting for 74% of our total net revenues, 32% of which related to the expiration of customer allowance agreements. Our rugged smartphones represented 66% of our total net revenues, 30% of which related to the expiration of customer allowance agreements, while feature phones were 29% of our total net revenues, and connected solutions were 4% of our total net revenues.
Previous wording
In alignment with Sonim Technologies’ commitment to quality, reliability, and regulatory compliance, we have prioritized our Environmental, Social, and Governance (ESG) and Trade Agreements Act (TAA) initiatives. TAA compliance is crucial in enhancing our market strategy, particularly in expanding opportunities within government and enterprise markets, which demand stringent adherence to regulatory standards. By ensuring our products meet TAA requirements, we reinforce our position as a trusted provider of enterprise 5G solutions.
Current wording
In alignment with Sonim Technologies’ commitment to quality, reliability, and regulatory compliance, we have prioritized our Trade Agreements Act (“TAA”) initiatives. TAA compliance is crucial in enhancing our market strategy, particularly in expanding opportunities within government and enterprise markets, which demand stringent adherence to regulatory standards. By ensuring our products meet TAA requirements, we reinforce our position as a trusted provider of enterprise 5G solutions.
Previous wording
As of the filing date of this report, Sonim is completing the development, testing and certification of new products that it expects to launch with various carriers in the fourth quarter of 2024 and in 2025.
Current wording
As of the filing date of this report, Sonim is completing the development, testing and certification of new products that it expects to launch in the second or third quarter of 2025 with various carriers.
Previous wording
We have no obligation to sell shares under the Sales Agreement, but we may do so from time to time. During the three months ended September 30, 2024, a total of 35,163 shares of common stock were sold under the Sales Agreement for net proceeds of $0.1 million after payment of commission fees and other related expenses of $4,000. As of September 30, 2024, the Company had approximately $8.8 million of common stock remaining available for sale under the ATM Sales Agreement.
Current wording
We have no obligation to sell shares under the Sales Agreement, and we have sold shares from time to time. During the three months ended March 31, 2025, a total of 1,349,840 shares of common stock were sold under the Sales Agreement for net proceeds of $3.7 million after payment of commission fees and other related expenses of $0.1 million. Subsequent to March 31, 2025, a total of 2,130,437 shares of common stock were sold under the Sales Agreement for net proceeds of $4.5 million after payment of commission fees and other related expenses of $0.1 million. As of the filing date of this report, the Company has completed its sales of shares of common stock under the Sales Agreement and the ATM program has been terminated.
Previous wording
To improve its liquidity during seasonally high working capital periods, on September 23, 2024, the Company entered into an invoice purchase agreement (the “Receivables Financing Agreement”) with LS DE LLC (“LS”), pursuant to which LS will provide receivables factoring to the Company, pursuant to which LS will advance 80% of the face value of the receivables being sold by the Company, up to a maximum of $2.5 million of eligible customer invoices from the Company. As of September 30, 2024, we did not have any outstanding commitments under the Receivables Financing Agreement. For additional information, refer to Note 1—The Company and Its Significant Accounting Policies to the condensed consolidated financial statements contained within this report under the title “Receivables Financing Agreement.”
Current wording
To improve its liquidity, on September 23, 2024, the Company entered into an invoice purchase agreement (the “Receivables Financing Agreement”) with LS DE LLC (“LS”), pursuant to which LS will provide receivables factoring to the Company, pursuant to which LS will advance 80% of the face value of the receivables being sold by the Company, up to a maximum of $2.5 million of eligible customer invoices from the Company. As of March 31, 2025, there was $0.6 million outstanding under the Receivables Financing Agreement, which is included in Accrued Liabilities in the Condensed Consolidated Balance Sheets. For additional information, refer to Note 1—The Company and Its Significant Accounting Policies to the condensed consolidated financial statements contained within this report under the title “Receivables Financing Agreement.”
Previous wording
The results of operations for the third quarter of 2024 are not necessarily indicative of the operating results to be expected for the full year or in any future period. Historically, we have experienced higher revenues following the release of new products and their sales with additional carriers and distributors. Additionally, we are actively expanding our Connected Solutions business, and the future demand of our Connected Solutions customers has not been reflected in our historical financial statements.
Current wording
The results of operations for the first quarter of 2025 are not necessarily indicative of the operating results to be expected for the full year or in any future period. Historically, we have experienced higher revenues following the release of new products and start of sales with additional carriers and distributors.
Previous wording
R&D expenses for the nine months ended September 30, 2024, increased by $0.9 million compared to 2023, primarily due to there being limited R&D projects during the first half of 2023. In 2024 R&D expenses were primarily related to our new hotspots and rugged phones.
Current wording
R&D expenses for the three months ended March 31, 2025, increased by $1.2 million compared to 2024, primarily due to there being limited R&D projects during the first half of 2024. In 2025 R&D expenses were primarily from internal work on the development of new variants of our XP Pro, including a version with a thermal camera, the HPUE hotspot, the XP400 phone for Europe, and the updated 5G version of our XP3plus. In the second quarter of 2025 we expect to continue to incur R&D expenses for these products.
Previous wording
Sales and marketing expenses for the three months ended September 30, 2024, increased by $0.9 million compared to 2023 primarily due to an increase in marketing spend to support new products in 2024, as well as an increase in headcount primarily to support sales in Europe.
Current wording
Sales and marketing expenses for the three months ended March 31, 2025, increased by $0.7 million compared to 2024 primarily due to an increase in marketing spend to support new products in 2025, compliance work for Europe, as well as an increase in compensation primarily related to sales in Europe.
Previous wording
General and administrative expenses for the three months ended September 30, 2024, increased by $0.8 million compared to 2023 primarily due to an increase in the accrual for employee bonuses of $0.5 million and higher legal expenses of $0.3 million.
Current wording
General and administrative expenses for the three months ended March 31, 2025, increased by $0.2 million compared to 2024 primarily due to an increase in legal expenses.
Previous wording
During the nine months ended September 30, 2024, our net loss was $12.0 million and our use of cash in operations was $4.0 million. Our cash balance is expected to cover the negative cash flow from operating losses and from developing new products over the next year. Increased revenue from new products is expected to improve cash flow over the next year. We expect to meet all obligations with existing cash and operating cash flow for a period of at least one year from the date of release of the unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.
Current wording
During the three months ended March 31, 2025, we reported net income of $0.5 million and used $9.6 million in operating cash flow. As of March 31, 2025, our principal source of liquidity consisted of cash and cash equivalents totaling $2.1 million. Subsequent to March 31, 2025, we have received $4.5 million in proceeds from the sale of equity through our ATM program. We also have access to up to $2.5 million under our Receivables Financing Agreement. We plan to continue to leverage multiple sources of liquidity to maintain flexibility in regard to meeting our capital needs. We expect these sources of liquidity to be sufficient to offset any future operating losses and to fund the development of new products over the next year. Increased revenue from new products is expected to further improve cash flow over the next year. We expect to meet all obligations with existing cash and operating cash flow for a period of at least one year from the date of release of the consolidated financial statements included in this Quarterly Report on Form 10-Q.
Previous wording
For the nine months ended September 30, 2024, cash used in operating activities was $4.0 million, primarily attributable to a net loss of $12.0 million and net cash used in a change in net operating assets and liabilities of $0.3 million, partially offset by non-cash charges of $8.3 million. The change in net operating assets and liabilities was primarily due to a decrease in accounts receivable, net, due to the timing of payments and an increase in accrued liabilities, partially offset by an increase in inventory (primarily due to raw materials inventory), non-trade receivables (primarily purchasing raw materials for our ODMs), related party receivables, and contract fulfillment assets (capitalized costs for product certifications). Non-cash charges primarily consist of $3.2 million in impairment charges related to contract fulfillment assets, $2.6 million in depreciation and amortization, $1.2 million for stock-based compensation, and $1.0 million in inventory write-downs.
Current wording
For the three months ended March 31, 2025, cash used in operating activities was $9.6 million, primarily attributable to net cash used in a change in net operating assets and liabilities of $6.1 million and net income of $0.5 million, excluding net non-cash operating activity of $4.0 million. The change in net operating assets and liabilities was primarily due to net payments made on accounts payable and an increase in contract fulfillment assets, which are capitalized costs for product certifications, partially offset by a decrease in inventory. Non-cash charges primarily consist of $5.3 million related to the expiration of customer allowance agreements, $1.1 million in depreciation and amortization and $0.3 million for stock-based compensation.
Previous wording
For the nine months ended September 30, 2023, cash used in operating activities was $3.7 million, primarily attributable to net cash used in a change in net operating assets and liabilities of $7.5 million, which was partially offset by net non-cash charges of $2.4 million and net income of $1.3 million. The change in net operating assets and liabilities was primarily due to an increase in accounts receivable (due to our tablet customer and a large carrier customer) and an increase in contract fulfillment assets (capitalized costs for product certifications), partially offset by an increase in accounts payable. Non-cash charges primarily consist of $1.2 million in depreciation and amortization, and $1.0 million for stock-based compensation.
Current wording
For the three months ended March 31, 2024, cash used in operating activities was $0.2 million, primarily attributable to a net loss of $2.9 million, partially offset by net cash provided by a change in our operating assets and liabilities of $1.5 million and net non-cash charges of $1.3 million. The change in net operating assets and liabilities was primarily due to a decrease in accounts receivable and inventory, partially offset by an increase in contract fulfillment assets. Non-cash charges primarily consist of $0.9 million in depreciation and amortization and $0.3 million for stock-based compensation.
Previous wording
For the nine months ended September 30, 2024, and 2023, there were no significant investing activities.
Current wording
For the three months ended March 31, 2025, and 2024, there were no significant investing activities.
Previous wording
For the nine months ended September 30, 2024, the Company received $3.8 million in cash, net of issuance costs, from an investor for the purchase of shares and the issuance of warrants, as well as ATM sales.
Current wording
For the three months ended March 31, 2025, the Company received $3.5 million in cash, net of issuance costs, from ATM sales, as well as $2.8 million in net proceeds from the issuance of the Note.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
For the three months ended March 31, 2024, there were no significant financing activities.