Release Date: August 16, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Strong demand from wireless carriers and distributors, with an order backlog of over $7 million.
- Revenue in Q3 2024 is expected to be significantly higher than Q2 2024.
- Tangible rapid adoption of the unique PTT product portfolio across various sales channels.
- Integration of SD7 handset with leading global push-to-talk application Zello, leading to meaningful sales.
- Expansion of the sales team with experienced personnel, such as Bob Escalle, enhancing product strategy and sales opportunities.
Negative Points
- Revenue decreased to $1.9 million in Q2 2024 from $2.7 million in Q2 2023.
- Gross margin percentage dropped to 10.4% in Q2 2024 from 29.7% in Q2 2023.
- SG&A expenses increased to $4 million in Q2 2024 from $2.7 million in Q2 2023.
- Adjusted EBITDA for Q2 2024 was negative $3.8 million compared to negative $2 million in Q2 2023.
- Working capital as of June 30, 2024, was negative $8.3 million, a significant decrease from $1.3 million as of December 31, 2023.
Q & A Highlights
Q: Can you elaborate on the reasons behind the revenue decrease in Q2 2024 compared to Q2 2023?
A: Marc Seelenfreund, CEO: The revenue decrease from $2.7 million in Q2 2023 to $1.9 million in Q2 2024 was primarily due to working capital constraints. We believe this was a short-term challenge that we have addressed with recent capital raises.
Q: What is the current status of your order backlog, and how does it impact your revenue projections for the rest of 2024?
A: Marc Seelenfreund, CEO: We have an order backlog of over $7 million, providing strong visibility into the third and fourth quarters. We expect Q3 2024 revenue to be significantly higher than Q2 2024, aiming for high double-digit growth for the year.
Q: What caused the significant drop in gross margin percentage from Q2 2023 to Q2 2024?
A: Marc Seelenfreund, CEO: The gross margin percentage dropped from 29.7% to 10.4% primarily due to a one-time heavily discounted transaction with an international reseller. We believe this will help our revenue in the second half of 2024.
Q: Can you provide more details on the increase in SG&A expenses in Q2 2024?
A: Marc Seelenfreund, CEO: SG&A expenses increased from $2.7 million in Q2 2023 to $4 million in Q2 2024. This was mainly due to marketing expenses related to investor awareness.
Q: What are your expectations for the adoption of your PTT product portfolio in the coming months?
A: Marc Seelenfreund, CEO: We are seeing rapid adoption of our PTT product portfolio across various sales channels, including emergency services, school safety, healthcare, utilities, hospitality, and enterprise use cases. We remain optimistic about strong sales growth in 2024.
Q: How is the integration of your SD7 handset with Zello impacting your sales?
A: Marc Seelenfreund, CEO: The integration with Zello has already led to meaningful sales and multiple new sales opportunities. We expect more application integrations to be announced in the future.
Q: What are your plans for new product launches, and how will they impact your future revenue?
A: Marc Seelenfreund, CEO: We are in discussions with business partners about new product launches, which we expect to announce in the coming months. These launches will have a significant positive impact on our revenue in 2025 and beyond.
Q: Can you provide more information about the recent hiring of Bob Escalle and his role at Siyata?
A: Marc Seelenfreund, CEO: Bob Escalle has joined us as VP of Public Safety. He previously served as the Director of Product Development at Samsung's mission-critical Push-to-Talk team. Bob has already helped us sharpen our product strategy and develop new sales opportunities.
Q: What are your goals for revenue growth and profitability in the coming quarters?
A: Marc Seelenfreund, CEO: We stand by our goal of strong revenue growth and aim to achieve profitability in the coming quarters.
Q: How can investors access your Q2 2024 financial results?
A: Marc Seelenfreund, CEO: We will file our Q2 2024 financial results with the SEC on Form 6-K. Investors can access them from the SEC's website by searching for Siyata Mobile.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
