CXApp Inc.
For the period ended Jun 30, 2025. Filed Aug 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.
Jun 30, 2025 · Filed Aug 13, 2025
CXAI$1.36+14.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-20.
0001829126-25-003841
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-13.
0001829126-25-006141
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 61 current paragraphs.
41 unchanged; 13 reworded; 7 added; 27 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 34 previous and 34 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 (7)
Current report
The Company generates revenue primarily from subscription-based Software as a Service (“SaaS”), as well as from the design, deployment, and implementation services provided through its enterprise applications platform. For the three months ended June 30, 2025, total revenue was $1,223 thousand, compared to $1,766 thousand for the three months ended June 30, 2024. The decrease of $543 thousand, or approximately 31%, was primarily attributable to a decline in non-recurring Professional Services revenue.
Current report
The reduction in Professional Services revenue reflects the Company’s strategic transition to a full SaaS delivery model, with a focus on recurring, high-margin revenue streams. Professional Services generally relate to implementation, customization, or integration services that are customer-specific and non-recurring in nature.
Current report
Subscription-based revenue comprised approximately 96% of total revenue for the three months ended June 30, 2025, compared to 85% for the same period in 2024, representing an 11-percentage point increase in revenue mix. This shift in revenue composition is consistent with management’s strategy to drive predictable recurring revenue and improve gross margin over time.
Current report
This increase was primarily driven by a $462 thousand rise in R&D expenses, reflecting increased investment in platform enhancements, including those related to the Company’s strategic relationship with Google. These efforts include development of deeper integrations with Google Workspace and AI infrastructure alignment designed to optimize data analytics and employee experience features across joint enterprise deployments.
Current report
The increase in R&D was partially offset by a $279 thousand decrease in sales and marketing expenses, as the Company reallocated go-to-market resources toward high-ROI enterprise accounts and strategic channel partnerships. Additionally, G&A expenses decreased by $83 thousand, reflecting ongoing cost control measures in administrative functions.
Current report
Management believes that these investments in innovation and platform interoperability position the Company to scale its AI-native offerings while driving long-term operating leverage.
Current report
Net cash flows provided in financing activities during the three months ended June 30, 2025 was approximately $3,990 thousand, primarily due to proceeds received from the issuance of convertible debt compared to net cash flows provided in financing activities for the six months ended June 30, 2024 is $ $2,480 thousand. On April 8,2025, the Company entered into a financing arrangement under which it issued convertible debt with a principal amount of $4,200 thousand. The Company received net proceeds of $3,990 thousand after accounting for any applicable discounts and transaction costs.
Removed paragraphs (27)
Previous report
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Previous report
The Company derives revenue from subscription software as a service (SaaS), design, deployment and implementation services for its enterprise apps business. Revenue was $1,224 thousand for the three months ended March 31, 2025, compared to $1,818 thousand for the three months ended March 31, 2024. The decrease in revenue of $594 thousand, for the comparative quarters ended March 31, 2025 and March 31, 2024 was due to a decline in Professional Services revenue. Professional services are related to integration works and other services that may be requested by the customer and as such the decline in revenue is attributable to the professional services revenue because the Company has moved to a full SaaS model versus one-time professional fees.
Previous report
Our subscription-based revenue represented 99% of the total revenue for the three months ended March 31, 2025 and 87% for the three months ended March 31, 2024 which is a 12% increase in the revenue mix.
Previous report
Critical Accounting Policies and Estimates
Previous report
Our consolidated financial statements are prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). In connection with the preparation of our financial statements, we are required to make assumptions and estimates about future events and apply judgments that affect the reported amounts of assets, liabilities, revenue, expenses, and the related disclosures. We base our assumptions, estimates and judgments on historical experience, current trends and other factors that management believes to be relevant at the time our consolidated financial statements are prepared. On a regular basis, we review the accounting policies, assumptions, estimates and judgments to ensure that our financial statements are presented fairly and in accordance with GAAP. However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material.
Previous report
Our significant accounting policies are discussed in Note 2 of the consolidated financial statements that are included elsewhere in this filing. We believe that the following accounting estimates are the most critical to aid in fully understanding and evaluating our reported financial results, and they require our most difficult, subjective or complex judgments, resulting from the need to make estimates about the effect of matters that are inherently uncertain. There have been no changes to estimates during the periods presented in the filing. Historically changes in management estimates have not been material.
Previous report
Revenue Recognition
Previous report
The Company recognizes revenue, in accordance with ASC 606, when control of the promised products or services is transferred to its customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those products or services. The Company derives revenue from its software as a service for cloud-based software, as well as design, implementation, other professional services for work performed in conjunction with its cloud-based software, and sale of hardware. The Company enters into contracts with its customers whereby it grants a non-exclusive cloud-based license for the use of its proprietary software and for professional services. The contracts may also provide for on-going services for a specified price, which may include maintenance services, designated support, and enhancements, upgrades and improvements to the software, depending on the contract. Licenses for cloud software provide the customer with a right to use the software as it exists when made available to the customer. All software provides customers with the same functionality and differs mainly in the duration over which the customer benefits from the software.
Previous report
License Subscription Revenue Recognition (Software As A Service)
Previous report
The timing of the Company’s revenue recognition related to the licensing revenue stream is dependent on whether the software licensing agreement entered into represents a service. Software that relies on an entity’s IP and is delivered only through a hosting arrangement, where the customer cannot take possession of the software, is a service. Customers may purchase perpetual licenses or subscribe to licenses, which provide customers with the same functionality and differ mainly in the duration over which the customer benefits from the software.
Previous report
The Company recognizes revenue evenly over the service period using a time-based measure because the Company is providing continuous access to its service. The Company’s customers generally pay within 30 to 60 days from the receipt of a customer approved invoice.
Previous report
Professional Services Revenue Recognition
Previous report
Professional services under milestone contracts are accounted for using the percentage of completion method. As soon as the outcome of a contract can be estimated reliably, contract revenue is recognized in the statement of operations in proportion to the stage of completion of the contract. Contract costs are expensed as incurred. Contract costs include all amounts that relate directly to the specific contract, are attributable to contract activity, and are specifically chargeable to the customer under the terms of the contract.
Previous report
Hardware Revenue Recognition
Previous report
For sales of hardware, the Company’s performance obligation is fulfilled when the products are shipped to the customer, transferring title and ownership risks. Deliveries occur via drop-shipment by a third-party vendor and the Company leverages drop-ship arrangements with many of its vendors and suppliers to deliver products to customers without having to physically hold the inventory at its warehouse. The Company negotiates sale prices, pays suppliers directly, manages credit risk, and ensures product acceptability, acting as the principal in the transaction and recording revenue on a gross basis. Customers typically pay within 30 to 60 days of invoice receipt. The Company has elected the practical expedient to expense the costs of obtaining a contract when they are incurred because the amortization period of the asset that otherwise would have been recognized is less than a year.
Previous report
There were no cash flows provided by or used in financing activities during three months ended March 31, 2025 or March 31, 2024.
Previous report
Quantitative and Qualitative Disclosures about Market Risk
Previous report
Critical Accounting Policies and Estimates
Previous report
Our unaudited condensed consolidated financial statements are prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). In connection with the preparation of our financial statements, we are required to make assumptions and estimates about future events, and apply judgments that affect the reported amounts of assets, liabilities, revenue, expenses and the related disclosures. We base our assumptions, estimates and judgments on historical experience, current trends and other factors that management believes to be relevant at the time our unaudited condensed consolidated financial statements are prepared. On a regular basis, we review the accounting policies, assumptions, estimates and judgments to ensure that our financial statements are presented fairly and in accordance with GAAP. However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material.
Previous report
Critical Accounting Policies
Previous report
Our significant accounting policies are discussed in Note 2 of the unaudited condensed consolidated financial statements which are included elsewhere in this filing.
Previous report
Critical Accounting Estimates
Previous report
We consider an accounting judgment, estimate or assumption to be critical when (1) the estimate or assumption is complex in nature or requires a high degree of judgment and (2) the use of different judgments, estimates and assumptions could have a material impact on our unaudited condensed consolidated financial statements.
Previous report
The Company believes there have been no significant changes during the three months ended March 31, 2025 to the items disclosed as critical accounting estimates in management’s discussion and analysis in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 that was filed with the SEC on April 7, 2025.
Previous report
JOBS Act Accounting Election
Previous report
Following the transaction, CXApp will be an “emerging growth company” as defined in the JOBS Act. As such, the Company will be eligible to take advantage of certain exemptions from various reporting requirements that apply to other public companies that are not emerging growth companies, including compliance with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act and the requirements to hold a non-binding advisory vote on executive compensation and any golden parachute payments not previously approved. The Company has not made a decision whether to take advantage of any or all of these exemptions. If the Company does take advantage of some or all of these exemptions, some investors may find the Company’s common stock less attractive. The result may be a less active trading market for the Company’s common stock and its stock price may be more volatile.
Previous report
In addition, Section 107 of the JOBS Act provides that an emerging growth company may take advantage of the extended transition period provided in Section 13(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), for complying with new or revised accounting standards, meaning that CXApp, as an emerging growth company, can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. The Company has elected to take advantage of this extended transition period, and therefore our financial statements may not be comparable to those of companies that comply with such new or revised accounting standards. Section 107 of the JOBS Act provides that our decision not to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable.
Reworded paragraphs (13)
Previous wording
You should read the following discussion of our financial condition and results of operations in conjunction with the unaudited condensed consolidated financial statements and related notes included elsewhere in this Form 10-Q, with the audited condensed consolidated financial statements included in our Annual Report on 10-K filed with the Securities and Exchange Commission (“SEC”) on April 7, 2025 (the “Annual Report”). References in this report (the “Quarterly Report”) to “we”, “us” or the “Company” refer to CXApp Inc. References to our “management” or our “management team” refer to our officers and directors. The following management’s discussion and analysis of financial condition and results of operations describes the principal factors affecting the results of our operations, financial condition, and changes in financial condition for the three months ended March 31, 2025.
Current wording
You should read the following discussion of our financial condition and results of operations in conjunction with the unaudited condensed consolidated financial statements and related notes included elsewhere in this Form 10-Q, with the audited consolidated financial statements and notes thereto included in our Annual Report on 10-K filed with the Securities and Exchange Commission (“SEC”) on April 7, 2025 (the “Annual Report”). References in this report (the “Quarterly Report”) to “we”, “us” or the “Company” refer to CXApp Inc. References to our “management” or our “management team” refer to our officers and directors. The following management’s discussion and analysis of financial condition and results of operations describes the principal factors affecting the results of our operations, financial condition, and changes in financial condition for the three months ended June 30, 2025.
Previous wording
This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Form 10-Q including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of the Company’s Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (the “SEC”). The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.
Current wording
This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Form 10-Q including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of the Company’s Annual Report on Form 10-K filed with the SEC. The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.
Previous wording
For the three months ended March 31, 2025, cash and cash equivalents was $3,893 thousand with access to an additional $3,990 thousand from a Securities Purchase Agreement the Company entered into on March 26, 2025.
Current wording
For the three months ended June 30, 2025, cash and cash equivalents was 4,854 thousand.
Previous wording
As of January 17, 2025, the Company paid down the entire December 2023 Note. On April 8, 2025, the Company received proceeds from the Avondale convertible Pre-Paid Purchase #1.
Current wording
On April 8, 2025, the Company received proceeds from the Avondale convertible Pre-Paid Purchase #1.
Previous wording
Cost of revenues includes the direct costs to deliver the services including labor and overhead. Cost of revenues were $150 thousand for the three months ended March 31, 2025 compared to $372 thousand for the three months ended March 31, 2024. The gross profit margin was 88% for the three months ended March 31, 2025 compared to 82% for the three months ended March 31, 2024. This decrease in cost of revenues of approximately $177 thousand, or approximately 54%, for the comparative periods ended March 31, 2025 and March 31, 2024, was attributable to the decrease in professional services revenue related costs.
Current wording
Cost of revenues includes the direct costs to deliver the services, including labor and overhead. Cost of revenues was $171 thousand for the three months ended June 30, 2025, compared to $353 thousand for the three months ended June 30, 2024. The gross profit margin was 86% for the three months ended June 30, 2025, compared to 80% for the three months ended June 30, 2024. The decrease in cost of revenues of approximately $182 thousand, or approximately 51.55%, for the comparative periods ended June 30, 2025 and June 30, 2024, was attributable to a reduction in professional services-related costs, as well as lower hosting and infrastructure expenses for cloud services.
Previous wording
Operating expenses consist primarily of research and development costs, sales and marketing costs, and general and administrative costs. These operating expenses were $4,819 thousand for the three months ended March 31, 2025 compared to $5,078 thousand for the three months ended March 31, 2024. The decrease in operating expenses of $259 thousand for the same comparative quarter was attributable to an increase in general and administrative expenses of $384 thousand and a decrease in other operating expenses of approximately $643 thousand.
Current wording
Operating expenses consist primarily of research and development (“R&D”), sales and marketing, and general and administrative (“G&A”) costs. For the three months ended June 30, 2025, total operating expenses were $5,163 thousand, compared to $5,063 thousand for the same period in 2024, representing an increase of $100 thousand.
Previous wording
Other income/expense was a $2,129 thousand income, $1,790 thousand expenses for the three months ended March 31, 2025 and March 31, 2024 respectively. This increase in other income was primarily attributable to changes in fair value of derivative warrant liabilities of $2,196 thousand during the three months ended March 31, 2025.
Current wording
Other income/expense was an income of $973 thousand and an expense of $1,765 thousand for the three months ended June 30, 2025, and the three months ended June 30, 2024, respectively. This increase of $2,738 thousand in other income for the comparative periods was attributable to an increase in the change in fair value of derivative warrant liabilities of approximately $1,931 thousand, an increase in other income of approximately $286 thousand, and a decrease in interest expense of approximately $521 thousand.
Previous wording
There was no income tax benefit for the three months ended March 31, 2025 compared to $207 thousand for the three months ended March 31, 2024. The income tax benefit for the three months ended March 31, 2024 is primarily a result of the release of valuation allowance attributable to acquired intangible assets from the Business Combination recorded in the first quarter of 2023.
Current wording
There was $1 thousand income tax expenses for the three months ended June 30, 2025, compared to $159 thousand tax benefit for the six months ended June 30, 2024. The income tax benefit for the three months ended June 30, 2024 is primarily a result of the release of valuation allowance attributable to acquired intangible assets from the Business Combination recorded in the first quarter of 2023.
Previous wording
We have presented Adjusted EBITDA above because we believe it conveys useful information to investors regarding our operating results. We believe it provides an additional way for investors to view our operations, when considered with both our GAAP results and the reconciliation to net income (loss). By including this information, we can provide investors with a more complete understanding of our business. Specifically, we present Adjusted EBITDA as supplemental disclosure because of the following:
Current wording
We have presented Adjusted EBITDA above because we believe it conveys useful information to investors regarding our operating results. We believe it provides an additional way for investors to view our operations, when considered with both our GAAP results and the reconciliation to net loss. By including this information, we can provide investors with a more complete understanding of our business. Specifically, we present Adjusted EBITDA as supplemental disclosure because of the following:
Previous wording
Net cash used in operating activities during the three months ended March 31, 2025 was $979 thousand consists of net loss of $1,616 thousand and operating gain of $637 thousand. On March 26, 2025, the company entered into a SPA with Avondale, pursuant to which the company may issue and sell up to $20,000 thousand of Pre-Paid Purchase agreements (“Pre-Paid Purchases”) in tranches over time. The initial tranche included a $4,200 thousand Pre-Paid Purchase, structured with a $200 thousand original issue discount (“OID”) and $10 thousand in transaction-related fees, resulting in net proceeds of $3,990 thousand, received on April 8, 2025. The Company believes such funds are sufficient to satisfy its working capital needs, capital asset purchases, debt repayments and other liquidity requirements associated with its existing operations for the next 12 months from the issuance date of the financial statements. The Company may continue to pursue strategic transactions and may raise additional capital as needed, using our equity securities and/or cash and debt financings in combinations appropriate for each acquisition.
Current wording
Net cash used in operating activities during the three months ended June 30, 2025, was $3,012 thousand, consisting of a net loss of $3,139 thousand and an operating gain of $596 thousand. On March 26, 2025, the Company entered into a Securities Purchase Agreement with Avondale Capital, LLC, under which the Company may issue and sell one or more Pre-Paid Purchase Agreements for up to an aggregate of $20,000 thousand in exchange for shares of its common stock. The initial Pre-Paid Purchase, in the principal amount of $4,200 thousand, was structured with a $200 thousand original issue discount (“OID”) and $10 thousand in transaction-related fees, resulting in net proceeds of approximately $3,990 thousand, which were received on April 8, 2025. As of June 30, 2025, approximately $15,800 thousand remained available under this agreement. Additionally, under the SPA with Streeterville Capital, LLC, entered into on May 22, 2024, the Company had access to up to $10,000 thousand in funding. As of June 30, 2025, $3,520 thousand in funding remained available under this agreement. The Company believes these funds are sufficient to satisfy its working capital needs, capital asset purchases, debt repayments, and other liquidity requirements associated with its existing operations for at least the next 12 months from the issuance date of the financial statements. The Company may continue to pursue strategic transactions and may raise additional capital as needed, using its equity securities and/or a combination of cash and debt financings appropriate for each acquisition.
Previous wording
As of March 31, 2025, the Company has a working capital deficiency of approximately $4,017 thousand and cash of approximately $3,893 thousand. For the three months ended March 31, 2025, the Company incurred net loss of approximately $1,611 thousand and used approximately $979 thousand of cash for operating activities.
Current wording
As of June 30, 2025, the Company had a working capital deficiency of approximately $1,415 thousand and cash of approximately $4,854 thousand. For the three months ended June 30, 2025, the Company incurred a net loss of approximately $3,139 thousand and used approximately $3,012 thousand of cash in operating activities.
Previous wording
Net cash flows used in investing activities during the three months ended March 31, 2025 was approximately $5 thousand compared to net cash flows used in and provided in investing activities for the three months ended March 31, 2024 is $18 thousand. Cash flows related to investing activities during the three months ended March 31, 2025 and March 31, 2024 include $5 thousand and $18 thousand were used for the purchase of property and equipment.
Current wording
Net cash flows used in investing activities during the three months ended June 30, 2025 was approximately $11 thousand compared to net cash flows used in and provided in investing activities for the three months ended June 30, 2024 is $8 thousand. Cash flows related to investing activities during the three months ended June 30, 2025 and June 30, 2024 include $11 thousand and $8 thousand were used for the purchase of property and equipment.
Previous wording
Contractual obligations are cash that we are obligated to pay as part of certain contracts that we have entered during our course of business. Our contractual obligations consist of operating lease liabilities that are included in our balance sheet. As of March 31, 2025, the total obligation for operating leases is approximately $365 thousand, of which approximately $274 thousand is expected to be paid in the next twelve months.
Current wording
Contractual obligations are cash that we are obligated to pay as part of certain contracts that we have entered during our course of business. Our contractual obligations consist of operating lease liabilities that are included in our balance sheet. As of June 30, 2025, the total obligation for operating leases is approximately $422 thousand, of which approximately $208 thousand is expected to be paid in the next twelve months.