10-Q - AUDIOEYE INC (0001362190) (Filer)

Thu, May 1, 9:15 PM (21 days ago)

**AudioEye, Inc. (AEYE) Q1 2025 Financial Summary** **Financial Health and Performance:** - **Revenue:** $9,733,000 (up 20% YoY) - Partner and Marketplace: $5,520,000 (up 17% YoY) - Enterprise: $4,213,000 (up 26% YoY) - **Gross Profit:** $7,738,000 (up 22% YoY) - **Operating Loss:** $(940,000) (up 49% YoY) - **Net Loss:** $(1,469,000) (up 77% YoY) - **Earnings per Share (EPS):** $(0.12) (up 71% YoY) - **Cash and Cash Equivalents:** $8,265,000 (up 46% from Dec 2024) - **Working Capital:** $3,585,000 (up 554% from Dec 2024) - **Annual Recurring Revenue (ARR):** $37,100,000 (up 16% YoY) **Profit Margins:** - **Gross Margin:** 79.5% (up from 78.2% in Q1 2024) - **Operating Margin:** -9.7% (down from -7.8% in Q1 2024) **Cash Flow:** - **Operating Cash Flow:** $(44,000) (down from $203,000 in Q1 2024) - **Investing Cash Flow:** $(790,000) (down from $(547,000) in Q1 2024) - **Financing Cash Flow:** $3,448,000 (up from $(1,852,000) in Q1 2024) **Earnings Changes:** - **Revenue Growth:** Driven by increased sales in both Partner and Marketplace and Enterprise channels. - **Operating Loss Increase:** Due to higher selling and marketing expenses, general and administrative expenses, and loss on extinguishment of debt. - **Net Loss Increase:** Primarily due to the loss on extinguishment of debt and increased operating expenses. **Quarterly Performance Discussion:** - **Revenue Growth:** AudioEye continued to focus on product innovation, expanding revenue, and managing expenses. The increase in revenue was driven by growth in both sales channels. - **Expenses:** Selling and marketing expenses increased due to higher third-party marketing expenses and costs associated with the ADA Site Compliance acquisition. General and administrative expenses increased due to litigation expenses and transaction costs related to business acquisitions. - **Cash Flow:** The decrease in operating cash flow was primarily due to additional investment in selling and marketing efforts and increases in litigation expenses. The increase in financing cash flow was due to proceeds from a new $12 million credit facility. **Trends and Uncertainties:** - **Positive Trends:** Continued revenue growth, increased ARR, and expansion in both sales channels. - **Uncertainties:** Increased operating expenses, litigation expenses, and the impact of business acquisitions on future financial performance. **Future Operations Impact:** - **Strategic Focus:** AudioEye will continue to invest in research and development, expand its customer base, and manage expenses to drive future growth. - **Financial Strategy:** The company will focus on maintaining liquidity, managing debt, and exploring additional financing options to support its growth initiatives.