Vislink Technologies(VISL) - 2024 Q3 - Quarterly Report

Revenue Performance - Net revenue for the three months ended September 30, 2024, was $7,066 thousand, a decrease of 1.57$7,179 thousand for the same period in 2023[14] - For the nine months ended September 30, 2024, net revenue increased to $24,366 thousand, up 25.5$19,410 thousand in the same period of 2023[14] - Proprietary Technology revenue for the three months ended September 30, 2024, was $333,000, compared to$726,000 for the same period in 2023, representing a decline of approximately 54%[53] - Customer Relationships revenue increased to $2,218,000 for the nine months ended September 30, 2024, from$1,900,000 in the same period of 2023, reflecting a growth of about 17%[53] - For the nine months ended September 30, 2024, total revenue was $24,366,000, an increase from$19,410,000 in the same period of 2023, representing a growth of approximately 25.5%[85] Operating Expenses and Losses - Total operating expenses for the three months ended September 30, 2024, were $10,326 thousand, an increase of 9.05$9,470 thousand in the same period of 2023[14] - The net loss for the three months ended September 30, 2024, was $3,010 thousand, compared to a net loss of$1,970 thousand for the same period in 2023[14] - The net loss for the nine months ended September 30, 2024, was $6,228 thousand, compared to a net loss of$6,754 thousand for the same period in 2023, indicating a decrease in losses[23] - Stock-based compensation for the nine months ended September 30, 2024, was $881 thousand, down from$1,600 thousand in the same period of 2023[23] - The company incurred an approximate $7.4 million loss from operations and$4.0 million of cash used in operating activities for the nine months ended September 30, 2024[36] Cash and Cash Equivalents - Cash and cash equivalents as of September 30, 2024, were $3,213 thousand, a decrease from$8,482 thousand as of December 31, 2023[11] - Cash and cash equivalents at the end of the period were $3,213 thousand, a decrease from$7,240 thousand at the end of September 30, 2023[23] - The company's total cash and cash equivalents decreased from $8.48 million as of December 31, 2023, to$3.21 million as of September 30, 2024[43] Stockholders' Equity and Liabilities - Total stockholders' equity as of September 30, 2024, was $31,990 thousand, down from$36,977 thousand as of December 31, 2023[12] - Total liabilities and stockholders' equity as of September 30, 2024, were $40,408 thousand, down from$44,992 thousand as of December 31, 2023[12] - The total deficit as of September 30, 2024, was $(306,853) thousand, compared to$(304,883) thousand at the beginning of the year[20] Research and Development - Research and development expenses for the three months ended September 30, 2024, were $1,160 thousand, an increase of 44.1$805 thousand in the same period of 2023[14] Investments and Unrealized Gains - The company reported an unrealized gain on investments held to maturity of $84 thousand for the three months ended September 30, 2024[14] - The company held investments in federal bonds valued at$6.0 million as of September 30, 2024, intended to be held to maturity[37] - The company has determined the fair value of its investments held to maturity to be $5.975 million as of September 30, 2024[48] - The company reported net foreign exchange losses of$70,000 for the nine months ended September 30, 2024, compared to $55,000 for the same period in 2023[42] - The company recognized unrealized losses on currency translation adjustments amounting to$(566,000) as of September 30, 2024[42] Customer and Vendor Concentration - The Company had sales to two customers amounting to $1,310,000 (19$892,000 (13%) during the three months ended September 30, 2024, indicating customer concentration risk[80] - As of September 30, 2024, four customers owed the Company approximately $1,235,000 (15$1,125,000 (14%), $1,011,000 (12$981,000 (12%) of consolidated net receivables, highlighting a shift in receivables concentration compared to the previous year[81] - The Company reported vendor concentration risk with two vendors accounting for over 10% of consolidated inventory purchases, totaling approximately $768,000 (20$522,000 (14%) for the three months ended September 30, 2024[82] Lease and Amortization - The total amortization expense for intangible assets was $240,000 for the three months ended September 30, 2024, compared to$250,000 for the same period in 2023, indicating a decrease of 4%[54] - The estimated amortization expense for total intangible assets for the next five years is projected to be approximately $3,052,000[55] - As of September 30, 2024, the Company reported Right-of-Use (ROU) assets totaling approximately$0.5 million, net of $1.9 million in accumulated amortization[59] - Operating lease liabilities recognized as of September 30, 2024, amounted to approximately$0.9 million, with $0.5 million classified as current and$0.4 million as non-current[59] - The total lease cost for the three months ended September 30, 2024, was $189,000, compared to$102,000 for the same period in 2023, representing an increase of approximately 85%[64] Miscellaneous - The Company issued 8,000 shares of common stock valued at $160,000 to specific board members during the nine months ended September 30, 2024[69] - As of September 30, 2024, warrants to purchase 454,546 shares of common stock were outstanding, with a weighted average exercise price of$65.00[70] - The weighted average discount rate for operating leases was 9.4% as of September 30, 2024, compared to 9.5% in the previous year[64] - The Company recognized $378,000 in tax rebates as other income for the nine months ended September 30, 2024, compared to$322,000 for the same period in 2023, indicating a 17.4% increase[86] - The 2023 Omnibus Equity Incentive Plan was approved on August 23, 2023, allowing the Company to grant 166,415 shares of common stock to eligible participants[75] - The company operates as a single reporting segment and believes the adoption of ASU 2023-07 has not significantly impacted its financial statements[31] - The company has not yet assessed the impact of ASU No. 2024-03 on its financial statements, which requires enhanced disclosures on expense disaggregation[34]