CXApp Inc.
For the period ended Dec 31, 2025. Filed Mar 30, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Mar 30, 2026
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-K
Period ended 2024-12-31; filed 2025-04-07.
0001829126-25-002438
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-03-30.
0001829126-26-002840
Item 7. 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 153 previous paragraphs and 171 current paragraphs.
89 unchanged; 25 reworded; 57 added; 39 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 61 previous and 73 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 (57)
Current report
As we advance our strategic roadmap, CXApp remains focused on executing with discipline and precision. Our AI-first approach, financial discipline, and emphasis on customer-centric innovation are key drivers of our long-term vision to redefine employee experiences in the hybrid workplace. By leveraging our strong foundation and expanding our enterprise footprint, we are well-positioned to deliver sustained growth and value for our stakeholders.
Current report
CXApp Inc. (“CXAI”), is a provider of enterprise software designed to support employee experience, workplace operations, and organizational decision-making. CXAI delivers a cloud-based platform that integrates digital workplace applications, analytics, and artificial intelligence capabilities intended to improve how employees, administrators, and organizations interact with workplace environments.
Current report
CXAI is headquartered in the San Francisco Bay Area, with additional operating locations in Toronto, Canada and Manila, Philippines. The Company serves customers across more than 50 countries, including organizations in regulated industries such as financial services, healthcare, and technology, as well as media and entertainment and consumer sectors.
Current report
CXAI’s platform is designed to operate within customers’ existing enterprise technology environments and is deployed across physical, hybrid, and digital workplace settings.
Current report
Market Context and Opportunity**
Current report
Organizations continue to adapt to distributed and hybrid work models, increasing demand for software that supports employee engagement, workplace utilization, and operational efficiency. At the same time, organizations are evaluating the use of artificial intelligence, including agentic AI, to automate tasks, coordinate workflows, and enable more responsive workplace services.
Current report
Many organizations, particularly in regulated and complex operating environments, require workplace software that supports configurable policies, governance, and compliance requirements. CXAI’s platform is designed to support these requirements through administrative controls and configurable automation.
Current report
In addition to serving large enterprises, CXAI is expanding its product offerings and go-to-market approach to address midmarket customers. The Company also identifies opportunities to apply its platform beyond traditional office environments to additional use cases, including retail locations, sports and entertainment venues, healthcare facilities, and other public or shared spaces. These environments present opportunities for agentic, AI-enabled solutions that support workforce coordination, service delivery, and operational visibility.
Current report
CXAI competes in the employee experience and workplace technology markets, which include providers of digital workplace applications, analytics platforms, and enterprise software focused on employee engagement and workplace operations.
Current report
CXAI’s primary offering is the CXAI Platform, a modular, cloud-based software platform designed for enterprise and midmarket deployment. The platform includes the following core components:
Current report
The CXAI Platform is offered through subscription-based licensing arrangements and is available for deployment through major cloud service providers, including Amazon Web Services, Google Cloud Platform, and Microsoft Azure. The Company also provides implementation, configuration, and ongoing support services in connection with customer deployments.
Current report
On March 26, 2025, the Company entered into a Securities Purchase Agreement (the “SPA”), pursuant to which Avondale Capital, LLC may issue and sell up to $20,000 thousand shares of the Company’s Common Stock and the Company issued an unsecured convertible Pre-Paid Purchase #1 to the Lender. The convertible Pre-Paid Purchase #1 has the original principal amount of $4,200 thousand and Lender gave consideration of $3,990 thousand, reflecting original issue discount of $200 thousand and Lender’s transaction cost of $10 thousand. A second tranche was received on August 7, 2025, with a principal amount of $3,150 thousand and net proceeds of approximately $3,000 thousand. The third tranche of the SPA was issued on October 17, 2025, with the principal amount of $5,250 thousand, the company received net proceeds of $5,000 thousand which was received on October 17, 2025. The fourth tranche of the SPA was issued on December 30, 2025, with the principal amount of $4,200 thousand, the company received net proceeds of $4,000 thousand which was received on December 30, 2025. As of December 31, 2025, approximately $3,200 thousand remained available under this agreement.
Current report
During the year 2025, the Company converted all outstanding convertible debt in accordance with the agreement with Streeterville Capital LLC, were converted into class A Common Stock equity.
Current report
Shelf Registration Statement (Form S-3)
Current report
On August 11, 2025, the Company filed a shelf registration statement on Form S-3 with the Securities and Exchange Commission (“SEC”), authorizing the future offering and sale of up to $150,000 thousand of various securities. Concurrently, the Company filed a prospectus supplement allowing for the issuance of up to $7,959 thousand of common stock under this registration statement. This amount is included within the total aggregate offering authorized.
Current report
Subsequently, the Company commenced sales of its common stock pursuant to the shelf registration. These sales were facilitated through a third-party arrangement with Maxim Group LLC, acting as the Company’s agent under an equity distribution agreement. The Company received $648 thousand and issued 782,102 shares of class A common stock, which are intended to be used for general working capital and other general corporate purposes.
Current report
Comparison of the results of operation for the year ended December 31, 2025 and December 31, 2024
Current report
The following table sets forth our results of operations. This data should be read together with our audited financial statements and related notes.
Current report
Subscription Revenue
Current report
Subscription revenue (software licenses and maintenance contracts) decreased $1.7 million, or 28%, to $4.5 million for the year ended December 31, 2025, from $6.2 million for the year ended December 31, 2024. The decrease represents 67% of the total revenue decline and was primarily driven by customer churn. Customers who did not renew their contracts during 2025 were concentrated in the healthcare and retail verticals, where budget constraints and delayed IT spending impacted renewal rates, particularly among mid-market customers. These decreases were partially offset by revenue from new customer engagements and continued expansion within select enterprise accounts.
Current report
The Company's recurring subscription revenue as a percentage of total revenue increased to 98% in 2025 from 87% in 2024, reflecting the Company's successful strategic transition toward a more scalable and capital-efficient SaaS business model with higher-quality recurring revenue streams.
Current report
Professional Services Revenue
Current report
Professional services revenue decreased $0.7 million, or 91%, to $73 thousand for the year ended December 31, 2025, from $798 thousand for the year ended December 31, 2024. This decline represents 28% of the total revenue decline and reflects significantly lower implementation and deployment services activity. The prior year included substantial professional services engagements associated with onboarding several large enterprise customers, with these implementation projects substantially completed in 2024 and not recurring at similar levels in 2025.
Current report
The near elimination of professional services revenue also reflects the Company's strategic shift toward a pure SaaS model with enhanced platform maturity and improved customer self-service capabilities, reducing the need for extensive implementation services and improving overall gross margins.
Current report
Hardware Revenue
Current report
Hardware revenue decreased $0.1 million, or 79%, to $30 thousand for the year ended December 31, 2025, from $142 thousand for the year ended December 31, 2024. This decline represents 5% of the total revenue decline and reflects lower hardware sales associated with new customer deployments, as hardware sales typically correlate with new customer onboarding and expansion activities. The reduction in hardware revenue is consistent with the Company's transition to a software-focused business model.
Current report
Strategic Focus
Current report
The Company is focused on improving customer retention through enhanced customer success programs and proactive engagement initiatives, increasing enterprise adoption of its AI-powered workplace experience platform, and expanding recurring subscription revenue to drive sustainable long-term growth. The Company's successful transition to 98% recurring revenue provides a more predictable revenue base and positions the business for improved unit economics and operational leverage.
Current report
Cost of Revenue
Current report
Cost of revenue decreased $0.7 million, or 55%, to $0.6 million for the year ended December 31, 2025, compared to $1.3 million for the year ended December 31, 2024. The decrease was primarily attributable to:
Current report
The 55% decline in cost of revenue significantly exceeded the 36% revenue decrease, reflecting the shift in revenue mix toward higher-margin subscription revenue (98% of total revenue in 2025 compared to 87% in 2024), the near elimination of lower-margin professional services and hardware revenue, and the Company's successful cost optimization initiatives.
Current report
Gross Profit and Gross Margin
Current report
Gross profit decreased $1.9 million to $4.0 million for the year ended December 31, 2025, from $5.9 million for the year ended December 31, 2024. Gross margin improved 500 basis points from 82.0% to 87.4%. The significant margin improvement was driven by:
Current report
The Company expects to maintain or further improve gross margins as it continues to focus on subscription-based recurring revenue, platform scalability, and ongoing infrastructure optimization. The 87.4% gross margin achieved in 2025 reflects the Company's positioning as a high-margin SaaS business and provides a strong foundation for achieving profitability as the Company returns to revenue growth.
Current report
Operating expenses consist primarily of research and development (“R&D”), sales and marketing (“S&M”), and general and administrative (“G&A”) costs. For the year ended December 31, 2025, total operating expenses were $21,582 thousand, compared to $19,598 thousand for the same period in 2024, representing an increase of $1,984 thousand.
Current report
The increase was driven by a $2.1 million goodwill impairment charge and increases in G&A and R&D expenses, partially offset by a decrease in S&M expenses. Each operating expense category is discussed in detail below.
Current report
R&D expenses increased $0.3 million, or 4%, to $6.7 million for the year ended December 31, 2025, from $6.4 million for the year ended December 31, 2024. The increase was primarily attributable to a $400 thousand one-time billing adjustment related to the Company's Google Cloud Platform committed use discount agreement, which required reconciliation of actual usage against the Company's three-year commitment in Q4 2025. This increase was partially offset by lower headcount costs of approximately $100 thousand resulting from delayed backfill timing, as two senior engineers departed in Q2 2025 with replacement hires starting in Q4 2025.
Current report
During 2025, the Company continued to invest in developing its Artificial Intelligence (AI)-powered Augmented Reality (AR) capabilities, AI-based analytics, and the CXAI Agentic AI offerings on the Company's platform. Management believes that these investments in research and development will maintain the Company's competitive position and create opportunities for long-term growth.
Current report
Sales and Marketing
Current report
S&M expenses decreased $1.2 million, or 36%, to $2.1 million for the year ended December 31, 2025, from $3.2 million for the year ended December 31, 2024. The decrease was primarily attributable to:
Showing the first 40 of 57 passages. Open the source sections for the rest.
Removed paragraphs (39)
Previous report
As we move forward, our leadership team remains committed to executing on our strategic vision, leveraging AI to redefine employee experiences, and delivering long-term value for our stakeholders. We believe CXApp’s AI-first approach, financial discipline, and customer-centric strategy position us well for sustained growth.
Previous report
CXApp Inc. (“CXAI”) is an AI-first employee experience platform that is redefining the employee experience market. Our mission is to put the employee first by delivering an intuitive and intelligent solution that seamlessly integrates the physical and digital workplace. With headquarters in the San Francisco Bay Area and satellite hubs in Toronto and Manila, we operate globally across more than 50 countries, serving Fortune 1000 companies in highly regulated industries such as financial services, healthcare, and technology.
Previous report
Prior to the closing of the Business Combination on March 14, 2023, CXApp and subsidiaries were wholly owned subsidiary of Inpixon (“Inpixon”) and the Company’s financial statements consist of Design Reactor, Inpixon Canada, Inpixon Philippines and select assets, liabilities, revenues and expenses of Inpixon and Inpixon India (collectively the “Company,” “we,” “us” or “our”), show the historical combined carve-out financial position, results of operations, changes in net investment and cash flows of the Company and should be read in conjunction with the accompanying notes thereto. The Company’s combined carve-out financial statements do not necessarily reflect what the results of operations, financial position, or cash flows would have been had the Company been a separate entity nor are they indicative of future results of the Company.
Previous report
The combined carve-out operating results of the Company have been specifically identified based on the Company’s existing divisional organization. The majority of the assets and liabilities of the Company have been identified based on the existing divisional structure. The historical costs and expenses reflected in the Company’s financial statements include an allocation for certain corporate and shared service functions. Management believes the assumptions underlying our combined carve-out financial statements are reasonable. Nevertheless, our combined carve-out financial statements may not include all of the actual expenses that would have been incurred had we operated as a standalone company during the periods presented and may not reflect our results of operations, financial position and cash flows had we operated as a standalone company during the year ended December 31, 2023. Actual costs that would have been incurred if we had operated as a standalone company would depend on multiple factors, including organizational structure and strategic decisions made in various areas, including information technology and infrastructure. We also may incur additional costs associated with being a standalone, publicly listed company that were not included in the expense allocations and, therefore, would result in additional costs that are not reflected in our historical results of operations, financial position and cash flows.
Previous report
Market Opportunity
Previous report
The employee experience market is experiencing rapid transformation driven by the shift to hybrid work environments and the demand for AI-driven solutions that optimize employee engagement and operational efficiency. According to industry research from Gartner and Forrester, the global market for employee experience software is projected to grow significantly as organizations seek solutions that enhance employee productivity and satisfaction. We believe CXAI is uniquely positioned to capitalize on this trend by providing an AI-native platform designed to address the evolving needs of the modern workplace.
Previous report
Our flagship product, the CXAI Platform (pronounced “Sky”), provides a comprehensive suite of tools designed to empower employees and enable organizations to create smarter workplaces. Key components of the platform include:
Previous report
CXAI’s solutions are available through leading cloud marketplaces, including AWS, Google Cloud, and Microsoft Azure, offering seamless procurement and deployment options for enterprise customers.
Previous report
December 2023 Note Exchanges
Previous report
During the period from July 15, 2024, to December 26, 2024, the Company exchanged $3,428 thousands of the outstanding balance of the Note for approximately 2,012,107 shares of the Company’s Class A Common Stock at exchange prices between $1.47 and $2.23 per share.
Previous report
Pursuant to the Exchange Agreements, the Lender will surrender the Partitioned Note in exchange for the Exchange Shares, which will be issued free of any restrictive securities legend. Other than the surrender of the Partitioned Note, no consideration of any kind shall be given by Lender to the Company in connection with this Agreement. Upon surrendering, the Partitioned Notes shall be cancelled, and all obligations of Borrower under the Partitioned Notes shall be deemed fulfilled.
Previous report
The Company analyzed the exchange of principal under the note as an extinguishment and compared the net carrying value of the debt being extinguished to the reacquisition price (shares of common stock being issued) and recorded an approximately $1,052 thousand loss on the exchange of debt for equity as a separate item in the other income (expense) section of the consolidated statements of operations for the year ended December 31, 2024.
Previous report
As of January 17, 2025, the Company paid down the entire December 2023 Note.
Previous report
Interest expense for the December 2023 Note recognized on the consolidated statements of operations and comprehensive loss were approximately $1,204 thousand and $53 thousand for the year ended December 31, 2024, and for period from March 15, 2023, to December 31, 2023, respectively.
Previous report
Acquisitions and Investments
Previous report
CXApp has not completed any mergers or acquisitions from March 14, 2023, to date; however, we continually evaluate strategic opportunities that align with our growth objectives and enhance our AI-driven employee experience platform. Our acquisition strategy focuses on expanding our product capabilities, entering new markets, acquiring top-tier talent, and achieving operational synergies.
Previous report
We take a disciplined approach to potential acquisitions and investments, ensuring alignment with our strategic goals and financial performance. Opportunities may be pursued through cash, stock, or a combination of both, depending on market conditions and strategic fit.
Previous report
While organic growth remains our priority, strategic acquisitions and partnerships are expected to play a key role in accelerating our expansion and strengthening our market position. There is no guarantee that we will pursue or complete any transactions, but we remain open to opportunities that we believe drive long-term value for our stakeholders.
Previous report
Research and Development
Previous report
For the purposes of the analysis of the results presented herein, the Company is presenting the combined results of operations for the period March 15, 2023, to December 31, 2023, of the Successor Company with the period January 1, 2023 to March 14, 2023 of the Predecessor Company. Although this presentation is not in accordance with generally accepted accounting principles in the United States, the Company believes presenting and analyzing the combined results allows for a more meaningful comparison of results for the year ended December 31, 2024, to the full twelve-month period ended December 31, 2023. The following selected data from our audited consolidated statements of operations and other supplementary data should be referred to while reading the results of operations discussion that follows*(in thousands)*:
Previous report
The Company derives revenue from software-as-a-service (SaaS), design, deployment, and implementation services for its enterprise apps business. There is a pass through of $142 thousand for beacons that are deployed at our customer’s sites. Revenue for the year ended December 31, 2024, was $7,142 thousand, compared to non-GAAP combined revenue of $7,366 thousand for the year ended December 31, 2023, reflecting a decrease of approximately $225 thousand, or 3%. This decline was primarily driven by a reduction in Professional Services revenue, which includes integration work and other customer-requested services. As 87% of our recognized revenue now comes from recurring subscription revenue, the decrease reflects the Company’s strategic shift towards a full SaaS model, reducing reliance on one-time professional fees to prioritize scalable, recurring revenue streams.
Previous report
Cost of revenues includes the direct costs to deliver the services including labor, overhead, hardware and shipping and freight costs. Cost of revenue for the year ended December 31, 2024, is $1,285 thousand compared to $1,751 thousand non-GAAP combined cost of revenues for the comparable period in the prior year. This decrease in cost of revenues of approximately $466 thousand, or approximately 27%, was attributable to the decrease in professional services revenue related costs.
Previous report
Gross profit, calculated as revenues less costs of revenues, may vary between periods and is primarily affected by various factors including average selling prices, product costs, product mix, customer mix, and production volumes. The gross profit margin for the year ended December 31, 2024, was 82% compared to 76% for the year ended December 31, 2023 (Non-GAAP combined).
Previous report
Operating expenses consist primarily of research and development costs, sales and marketing costs, and general and administrative costs. Operating expenses for the year ended December 31, 2024, were $19,598 thousand and non-GAAP combined $58,204 thousand for the comparable period ended December 31, 2023. This decrease of $38,606 thousand is primarily attributable to impairment of goodwill of $36,056 thousand and a decrease of $2,550 thousand in other operating expenses as an effect of management reduction effort post-business combination.
Previous report
Loss from operations for the year ended December 31, 2024, was $13,741 thousand compared to the non-GAAP combined loss from operations of $52,589 thousand for the year ended December 31, 2023. This decrease in loss of $38,848 thousand is primarily attributable to impairment of goodwill, decreased operating expenses as detailed above plus the increased gross profit margin of approximately $242 thousand.
Previous report
The income tax benefit for 2024 (Successor) primarily resulted from the partial release of the valuation allowance associated with deferred tax assets recognized on intangible assets acquired in the Business Combination completed on March 14, 2023. Specifically, the benefit reflects the reversal of deferred tax liabilities attributable to those acquired intangible assets.
Previous report
However, the Company has concluded that the negative evidence outweighs the positive evidence regarding the realization of its deferred tax assets. As a result, it is more likely than not that the benefits of certain deferred tax assets will not be realized in the foreseeable future. Accordingly, a valuation allowance has been recorded as of December 31, 2024.
Previous report
Net loss for the year ended December 31, 2024, was $19,408 thousand compared to the $53,618 thousand non-GAAP combined net loss for the year ended December 31, 2023. This decrease in loss of approximately $34,210 thousand was primarily attributable to the decrease in operating expenses of $38,606 thousand, change in fair value of derivative liability of $1,562 thousand and increase in interest expense of $1,822 thousand, loss on extinguishment of $1,052 thousand and other income of $389 thousand plus higher gross margin of $242 thousand offset by a lower income tax benefit of approximately $2,937 thousand.
Previous report
The non-cash expenses were approximately $11,802 thousand, $40,813 thousand, and $1,200 thousand for the year ended December 31, 2024 (Successor), period from March 15, 2023, to December 31, 2023 (Successor), and period from January 1, 2023, to March 14, 2023 (Predecessor), respectively:
Previous report
As of December 31, 2024, we owed approximately $603 thousand under a promissory note with the Lender. See Note 9 of the Notes to Consolidated Financial Statements included elsewhere in this Annual Report.
Previous report
In addition, as of December 31, 2024, we have a liability for outstanding warrants, of $5,048 thousand. Each warrant is immediately exercisable for one share of Common Stock and will expire on March 15, 2028, or earlier upon redemption or liquidation. See Notes 2 and 10 of the Notes to Consolidated Financial Statements included elsewhere in this Annual Report.
Previous report
On May 22, 2024, the Company entered into the SPA which the Lender desires to purchase shares of the Company’s Common Stock, pursuant to which the Company issued unsecured convertible Pre-Paid Purchases #1, #2, and #3 to the Lender. As of December 31, 2024, we owe a total of approximately $4,512 thousand under the Pre-Paid Purchases which accrues interest on the outstanding balance at 5% per annum. See Note 12 of the Notes to Consolidated Financial Statements included elsewhere in this Annual Report.
Previous report
Net cash used in operating activities for the year ended December 31, 2024 (Successor) of $7,325 thousand consists of net loss of $19,408 thousand offset by non-cash adjustments of approximately $11,802 thousand less net cash changes in operating assets and liabilities of approximately $281 thousand. Although the Company has sustained losses during the year ended December 31, 2024 (Successor), we raised net proceeds of approximately $6,480 thousand of the $10,000 thousand available from the SPA entered into by the Company on May 22, 2024. Given our current cash balances, budgeted cash flow requirements, and financing capability of up to $20,000 thousand, 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.
Previous report
Business Combinations
Previous report
We account for business combinations using the acquisition method of accounting, and accordingly, the assets and liabilities of the acquired business are recorded at their fair values at the date of acquisition. The excess of the purchase price over the estimated fair value is recorded as goodwill. Any changes in the estimated fair values of the net assets recorded for acquisitions prior to the finalization of more detailed analysis, but not to exceed one year from the date of acquisition, will change the amount of the purchase price allocable to goodwill. Any subsequent changes to any purchase price allocations that are material to our combined financial results will be adjusted. All acquisition costs are expensed as incurred and in-process research and development costs are recorded at fair value as an indefinite-lived intangible asset and assessed for impairment thereafter until completion, at which point the asset is amortized over its expected useful life. Separately recognized transactions associated with business combinations are generally expensed subsequent to the acquisition date. The application of business combination and impairment accounting requires the use of significant estimates and assumptions.
Previous report
Upon acquisition, the accounts and results of operations are combined as of and subsequent to the acquisition date and are included in our Combined Financial Statements from the acquisition date.
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 (25)
Previous wording
References in this report (the “Annual 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 years ended December 31, 2024, and the period March 15, 2023 to December 2023.
Current wording
References in this report (the “Annual 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 years ended December 31, 2025, and December 2024.
Previous wording
At CXApp, we are redefining the modern workplace through AI-powered solutions that enhance employee experience, operational efficiency, and workplace intelligence. As a leader in this rapidly evolving market, our strategic vision is to drive innovation, scale our enterprise customer base, and achieve long-term financial sustainability through disciplined execution.
Current wording
At CXApp, we are at the forefront of transforming the modern workplace through AI-powered solutions that enhance employee experience, operational efficiency, and workplace intelligence. As a leader in this evolving market, our strategic focus is to drive sustainable growth, scale our enterprise customer base, and deliver innovative solutions that leverage data and artificial intelligence to optimize workplace experiences.
Previous wording
As we look ahead, our leadership team remains committed to balancing innovation with financial discipline, ensuring CXApp is positioned for sustainable, profitable growth in the years to come.
Current wording
Looking forward, our leadership team remains committed to balancing innovation with financial discipline, ensuring that CXApp is positioned for long-term profitability and strategic growth. By leveraging our AI-driven platform and expanding our enterprise footprint, we aim to deliver scalable, data-driven solutions that address the evolving needs of hybrid workplaces.
Previous wording
With 87% of our revenue derived from recurring subscriptions, CXAI enjoys stable and predictable cash flow, further supported by strong net retention rates and customer upsell opportunities.
Current wording
With 98% of our revenue derived from recurring subscriptions, CXAI enjoys stable and predictable cash flow, further supported by strong net retention rates and customer upsell opportunities.
Previous wording
During the year ended December 31, 2024, the Company has issued 1,683,104 shares of the Company’s Class A Common Stock pursuant to multiple purchase notices for an exchange amount of $2,100 thousand.
Current wording
During the year ended December 31, 2025, the Company has issued 13,071,408 shares of the Company’s Class A Common Stock pursuant to multiple purchase notices for an exchange amount of $8,102 thousand.
Previous wording
We monitor key performance indicators such as revenue growth, customer expansion, recurring revenue rates, and customer retention to measure our market penetration and growth trajectory. In 2024, approximately 87% of our revenue was recurring, reflecting a significant increase from 78% in 2023.
Current wording
We monitor key performance indicators such as revenue growth, customer expansion, recurring revenue rates, and customer retention to measure our market penetration and growth trajectory. In 2025, approximately 98% of our revenue was recurring, reflecting a significant increase from 87% in 2024.
Previous wording
CXApp’s ability to drive revenue growth depends on expanding relationships with existing customers and acquiring new customers by offering high-quality, scalable solutions that address the evolving needs of enterprises. Our direct sales efforts, strategic partnerships, and continuous innovation efforts play a crucial role in customer acquisition and retention. We maintain a diversified customer base, with our top three customers accounting for approximately 24% of our gross revenue in 2024, compared to 22% in 2023.
Current wording
CXApp’s ability to drive revenue growth depends on expanding relationships with existing customers and acquiring new customers by offering high-quality, scalable solutions that address the evolving needs of enterprises. Our direct sales efforts, strategic partnerships, and continuous innovation efforts play a crucial role in customer acquisition and retention. We maintain a diversified customer base, with our top three customers accounting for approximately 40% of our gross revenue in 2025, compared to 24% in 2024.
Previous wording
During the year*,*the Company added resources dedicated to developing the Artificial Intelligence (AI) based Augmented Reality (AR), AI based analytics and our CXAI Agentic AI offerings on the CXAI platform. Management believes that this investment in research and development will maintain a competitive position and create opportunities for the Company.
Current wording
During the year 2025*,*the Company added resources dedicated to developing the Artificial Intelligence (AI) based Augmented Reality (AR), AI based analytics and our CXAI Agentic AI offerings on the CXAI platform. Management believes that this investment in research and development will maintain a competitive position and create opportunities for the Company.
Previous wording
Year Ended December 31, 2024, compared to the Year Ended December 31, 2023
Current wording
Revenue decreased $2.6 million, or 36%, to $4.6 million for the year ended December 31, 2025, compared to $7.1 million for the year ended December 31, 2024. The decrease was attributable to the following:
Previous wording
Other income (expense) for the year ended December 31, 2024, was $6,302 thousand expense compared to $4,601 thousand expense for the year ended December 31, 2023. The increase in other expense of $1,701 thousand is primarily attributable to change in fair value of derivative liabilities of approximately $1,562 thousand plus the increase in interest expense of $1,822 thousand, loss on debt extinguishment of $1,052 thousand and other expenses of $389 thousand.
Current wording
Other income (expense) for the year ended December 31, 2025, was $4,058 thousand income compared to $6,302 thousand expense for the year ended December 31, 2024. The increase in other income of $10,360 thousand is primarily attributable to $7,700 thousand reduction in the change in fair value of derivative liabilities, plus the decrease in interest expense of $1,055 thousand, loss on debt extinguishment of $1,004 thousand and other expenses of $601 thousand.
Previous wording
For the year ended December 31, 2024, the Company recorded an income tax benefit of approximately $637 thousand, compared to an income tax benefit of $3,572 thousand for the period March 15, 2023 to December 31, 2023 (on a Non-GAAP combined basis).
Current wording
For the year ended December 31, 2025, the Company recorded an income tax benefits of approximately $46 thousand, compared to an income tax benefit of $635 thousand for the year ended December 31, 2024.
Previous wording
As of December 31, 2024, the Company has a working capital deficit of approximately $4,496 thousand and cash of approximately $4,880 thousand. For the period ended December 31, 2024 (Successor), the Company incurred net loss of approximately $19,408 thousand. For the ended December 31, 2024 (Successor), the Company used approximately $7,325 thousand of cash for operating activities, of which $453 thousand was from a reduction in accounts payable, primarily from paying vendors and consultants. For the period from March 15, 2023, to December 31, 2023 (Successor), the Company used approximately $12,766 thousand cash for operating activities. The Predecessor Company used approximately $5,144 thousand cash for operating activities for period January 1, 2023, to March 14, 2023.
Current wording
As of December 31, 2025, the Company has a working capital surplus of approximately $7,075 thousand and cash of approximately $11,101 thousand. For the period ended December 31, 2025, the Company incurred net loss of approximately $13,473 thousand and used approximately $10,381 thousand of cash for operating activities. For the year ended December 31, 2024, the Company incurred net loss of approximately $19,408 and used approximately $7,325 thousand cash for operating activities.
Previous wording
Management believes that the current liquidity position, including under the SPA with the Lender, pursuant to which the Lender desires to purchase up to $10,000 thousand in shares of the Company’s Common Stock, par value $0.0001, with $3,000 thousand still available to withdraw and with additional $20,000 thousand equity line of credit signed on March 25, 2025, has the ability to mitigate any going concern indicators for a period of at least one year from the date these financial statements are issued.
Current wording
Management believes that the Companies current liquidity position is sufficient for the next twelve months, including under the SPA with the Streeterville Capital, LLC, pursuant to which the Lender desires to purchase up to $10,000 thousand in shares of the Company’s Common Stock, par value $0.0001, with $3,520 thousand still available to withdraw. On March 26, 2025, the Company entered into a SPA with Avondale Capital, LLC, pursuant to which the Lender desires to purchase up to $20,000 thousand in shares of the Company’s Common Stock, par value $0.0001, with $3,200 thousand still available to withdraw.
Previous wording
The net cash used in the change in operating assets and liabilities were approximately $281 thousand, $4,341 thousand and $1,964 thousand for the year ended December 31, 2024 (Successor), period from March 15, 2023, to December 31, 2023 (Successor) and January 1, 2023, to March 14, 2023 (Predecessor), respectively:
Current wording
The net cash used in the change in operating assets and liabilities were approximately $1,110 thousand, for the year ended December 31, 2025 and net cash provided in the change in operating assets and liabilities were approximately $281 thousand for the year ended December 31, 2024, respectively:
Previous wording
Net cash flows used in investing activities during the year ended December 31, 2024 (Successor) was approximately $30 thousand compared to net cash flows provided by investing activities for the period March 15, 2023, to December 31, 2023 (Successor) and cash flows used in investing activities for the period from January 1, 2023, to March 14, 2023 (Predecessor) of approximately $9,946 thousand and $54 thousand, respectively. Cash flows related to investing activities during the year ended December 31, 2024 (Successor) is attributable to the purchases of property and equipment. Cash flows related to investing activities during the period from March 15, 2023, to December 31, 2023 (Successor) include $57 thousand for the purchase of property and equipment, and $10,003 thousand for cash acquired in connection with the Business Combination. Cash flows related to investing activities during the period from January 1, 2023, to March 14, 2023 (Predecessor) include $9 thousand for the purchase of property and equipment, and $45 thousand for the investment in capitalized software.
Current wording
Net cash flows used in investing activities during the year ended December 31, 2025 was approximately $23 thousand compared to net cash flows provided by investing activities for the year ended December 31, 2024 was approximately $30 thousand. Cash flows related to investing activities during the years ended December 31, 2025 and December 31, 2024 is attributable to the purchases of property and equipment.
Previous wording
Net cash flows provided by financing activities during the year ended December 31, 2024 (Successor) was approximately $5,980 thousand compared to net cash flows provided by financing activities for the period from March 15, 2023, to December 31, 2023 (Successor) and for the period from January 1, 2023, to March 14, 2023 (Predecessor) of approximately $7,620 thousand and $8,892 thousand, respectively. On May 22, 2024, the Company entered into the “SPA with the Lender, pursuant to which the Lender desires to purchase up to $10,000 thousand in shares of the Company’s Common Stock, par value $0.0001. Pursuant to SPA, the Company issued three unsecured convertible Pre-Paid Purchases to Lender. The convertible Pre-Paid Purchases have original principal amount of $6,825 thousand. For the year ended December 31, 2024, the Company received net proceeds of $6,480 thousand, reflecting original issue discount of $325 thousand and Lender’s transaction cost of $20 thousand. During the year ended December 31, 2024, the Company paid $500 thousand in cash outflows for a repayment of the promissory note. During the period from March 15, 2023 to December 31, 2023 (Successor), the Company paid $328 thousand in cash outflows from a repayment of a related party promissory note, received $3,000 thousand from the issuance of a promissory note, received $5,002 thousand of cash proceeds for exercise of 435 public warrants and paid $54 thousand of issuance cost During the period from January 1, 2023 to March 14, 2023 (Predecessor), the Company received $9,089 thousand in incoming cash flows from parent, and paid $197 thousand in cash outflows from a payment of an acquisition liability.
Current wording
Net cash flows provided by financing activities during the year ended December 31, 2025 was approximately $16,638 thousand compared to net cash flows provided by financing activities for the year ended December 31, 2024 was approximately $5,980 thousand.
Previous wording
On May 22, 2024, the Company entered into a Securities Purchase Agreement (the “SPA”), pursuant to which Streeterville Capital, LLC wants to purchase up to $10,000 thousand shares of the Company’s Common Stock and the Company issued an unsecured convertible Pre-Paid Purchase #1 to the Lender. The convertible Pre-Paid Purchase #1 has the original principal amount of $2,625 thousand and Lender gave consideration of $2,480 thousand, reflecting original issue discount of $125 thousand and Lender’s transaction cost of $20 thousand.
Current wording
On May 22, 2024, the Company entered into the “SPA with the Lender, pursuant to which the Lender desires to purchase up to $10,000 thousand in shares of the Company’s Common Stock, par value $0.0001. Pursuant to SPA, the Company issued three unsecured convertible Pre-Paid Purchases to Lender. The convertible Pre-Paid Purchases have original principal amount of $6,825 thousand. For the year ended December 31, 2024, the Company received net proceeds of $6,480 thousand, reflecting original issue discount of $325 thousand and Lender’s transaction cost of $20 thousand. During the year ended December 31, 2024, the Company paid $500 thousand in cash outflows for a repayment of the promissory note.
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 December 31, 2024, the total obligation for operating leases is approximately $473 thousand, of which approximately $376 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 December 31, 2025, the total obligation for operating leases is approximately $226 thousand, of which approximately $204 thousand is expected to be paid in the next twelve months.
Previous wording
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.
Current wording
The Company recognizes revenue, in accordance with ASC 606 “Revenue from Contracts with Customers” (“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 wording
When assessing the recoverability of our long-lived assets, which include property and equipment and finite-lived intangible assets, we make assumptions regarding estimated future cash flows and other factors. Some of these assumptions involve a high degree of judgment and bear a significant impact on the assessment conclusions. Included among these assumptions are estimating undiscounted future cash flows, including the projection of comparable sales, operating expenses, capital requirements for maintaining property and equipment and residual value of asset groups. We formulate estimates from historical experience and assumptions of future performance, based on business plans and forecasts, recent economic and business trends, and competitive conditions. In the event that our estimates or related assumptions change in the future, we may be required to record an impairment charge. Based on our evaluation we did not record a charge for impairment related to long-lived assets for the year ended December 31, 2024 (Successor), for the period ended March 15, 2023, to December 31, 2023 (Successor), and for the period ended January 1, 2023 to March 14, 2023 (Predecessor).
Current wording
When assessing the recoverability of our long-lived assets, which include property and equipment and finite-lived intangible assets, we make assumptions regarding estimated future cash flows and other factors. Some of these assumptions involve a high degree of judgment and bear a significant impact on the assessment conclusions. Included among these assumptions are estimating undiscounted future cash flows, including the projection of comparable sales, operating expenses, capital requirements for maintaining property and equipment and residual value of asset groups. We formulate estimates from historical experience and assumptions of future performance, based on business plans and forecasts, recent economic and business trends, and competitive conditions. In the event that our estimates or related assumptions change in the future, we may be required to record an impairment charge. Based on our evaluation we did not record a charge for impairment related to long-lived assets for the years ended December 31, 2025 and December 31, 2024.
Previous wording
We evaluate the remaining useful lives of long-lived assets and identifiable intangible assets whenever events or circumstances indicate that a revision to the remaining period of amortization is warranted. Such events or circumstances may include (but are not limited to): the effects of obsolescence, demand, competition, and/or other economic factors including the stability of the industry in which we operate, known technological advances, legislative actions, or changes in the regulatory environment. If the estimated remaining useful lives change, the remaining carrying amount of the long-lived assets and identifiable intangible assets would be amortized prospectively over that revised remaining useful life. We have determined that there were no events or circumstances during the year ended December 31, 2024 (Successor), for the period from March 15, 2023, to December 31, 2023 (Successor), and for the period from January 1, 2023 to March 14, 2023 (Predecessor), which would indicate a revision to the remaining amortization period related to any of our long-lived assets. Accordingly, we believe that the current estimated useful lives of long-lived assets reflect the period over which they are expected to contribute to future cash flows and are therefore deemed appropriate.
Current wording
We evaluate the remaining useful lives of long-lived assets and identifiable intangible assets whenever events or circumstances indicate that a revision to the remaining period of amortization is warranted. Such events or circumstances may include (but are not limited to): the effects of obsolescence, demand, competition, and/or other economic factors including the stability of the industry in which we operate, known technological advances, legislative actions, or changes in the regulatory environment. If the estimated remaining useful lives change, the remaining carrying amount of the long-lived assets and identifiable intangible assets would be amortized prospectively over that revised remaining useful life. We have determined that there were no events or circumstances during the years ended December 31, 2025 and December 31, 2024, which would indicate a revision to the remaining amortization period related to any of our long-lived assets. Accordingly, we believe that the current estimated useful lives of long-lived assets reflect the period over which they are expected to contribute to future cash flows and are therefore deemed appropriate.
Previous wording
We analyzed goodwill first to assess qualitative factors, such as macroeconomic conditions, changes in the business environment and reporting unit specific events, to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform a detailed goodwill impairment test as required. The more-likely-than-not threshold is defined as having a likelihood of more than 50%. If we bypass the qualitative assessment or conclude that it is more likely than not that the fair value of a reporting unit is less than its carrying value, then we perform a quantitative impairment test by comparing the fair value of a reporting unit with its carrying amount. We calculate the estimated fair value of a reporting unit using a weighting of the income and market approaches. For the income approach, we use internally developed discounted cash flow models that include the following assumptions, among others made by management: projections of revenues, expenses, and related cash flows based on assumed long-term growth rates and demand trends; expected future investments to grow new units; and estimated discount rates. For the market approach, we use internal analyses based primarily on market comparables. We base these assumptions on its historical data and experience, third party appraisals, industry projections, micro and macro general economic condition projections, and its expectations. Due to the variables inherent in our estimates of fair value, differences in assumptions may have a material effect on the result of our impairment analysis.
Current wording
The Company estimates the fair value of the reporting unit using a combination of the income and market approaches. For the income approach, the Company uses internally developed discounted cash flow models that include assumptions such as projected revenues, expenses, and related cash flows based on long-term growth rates and demand trends; expected future investments to support operations; and estimated discount rates. For the market approach, the Company relies on analyses based primarily on market comparables, including the guideline public company method, guideline transaction method, and market price method.
Previous wording
Based on its assessments, the Company has recorded impairment of goodwill of $0 thousand and $36,056 thousand for the year ended December 31, 2024 (Successor) and for the period from March 15, 2023, to December 31, 2023 (Successor), respectively.
Current wording
Based on its assessments, the Company has recorded impairment of goodwill of $2,148 thousand for the years ended December 31, 2025 and December 31, 2024, respectively.
Previous wording
In accordance with ASC 740 “Income Taxes” (“ASC 740”), management routinely evaluates the likelihood of the realization of its income tax benefits and the recognition of its deferred tax assets. In evaluating the need for any valuation allowance, management will assess whether it is more likely than not that some portion, or all, of the deferred tax asset may not be realized on a jurisdictional basis. Ultimately, the realization of deferred tax assets is dependent upon the generation of future taxable income during those periods in which temporary differences become deductible and/or tax credits and tax loss carry-forwards can be utilized. In performing its analyses, management considers both positive and negative evidence including historical financial performance, previous earnings patterns, future earnings forecasts, tax planning strategies, economic and business trends and the potential realization of net operating loss carry-forwards within a reasonable timeframe. To this end, management considered (i) that we have had historical losses in the prior years and cannot anticipate generating a sufficient level of future profits in order to realize the benefits of our deferred tax asset; (ii) tax planning strategies and (iii) the adequacy of future income as of and for the year ended December 31, 2024 (Successor), based upon certain economic conditions and historical losses through December 31, 2024. After consideration of these factors, management deemed it appropriate to establish a full valuation allowance with respect to the deferred tax assets for the Company as of December 31, 2024 (Successor) and December 31, 2023 (Successor), and no liability for unrecognized tax benefits was required to be reported.
Current wording
In accordance with ASC 740 “Income Taxes” (“ASC 740”), management routinely evaluates the likelihood of the realization of its income tax benefits and the recognition of its deferred tax assets. In evaluating the need for any valuation allowance, management will assess whether it is more likely than not that some portion, or all, of the deferred tax asset may not be realized on a jurisdictional basis. Ultimately, the realization of deferred tax assets is dependent upon the generation of future taxable income during those periods in which temporary differences become deductible and/or tax credits and tax loss carry-forwards can be utilized. In performing its analyses, management considers both positive and negative evidence including historical financial performance, previous earnings patterns, future earnings forecasts, tax planning strategies, economic and business trends and the potential realization of net operating loss carry-forwards within a reasonable timeframe. To this end, management considered (i) that we have had historical losses in the prior years and cannot anticipate generating a sufficient level of future profits in order to realize the benefits of our deferred tax asset; (ii) tax planning strategies and (iii) the adequacy of future income as of and for the year ended December 31, 2025, based upon certain economic conditions and historical losses through December 31, 2025. After consideration of these factors, management deemed it appropriate to establish a full valuation allowance with respect to the deferred tax assets for the Company as of December 31, 2025 and December 31, 2024, and no liability for unrecognized tax benefits was required to be reported.
Previous wording
The guidance also discusses the classification of related interest and penalties on income taxes. The Company’s policy is to record interest and penalties on uncertain tax positions as a component of income tax expense. No interest or penalties were recorded during the year ended December 31, 2024 (Successor), for the period from March 15, 2023, to December 31, 2023 (Successor), and for the period from January 1, 2023 to March 14, 2023 (Predecessor).
Current wording
The guidance also discusses the classification of related interest and penalties on income taxes. The Company’s policy is to record interest and penalties on uncertain tax positions as a component of income tax expense. No interest or penalties were recorded during the years ended December 31, 2025 and December 31, 2024.