Category: Emissions Trading

MIL-OSI USA: Senator Marshall Joins Colleagues in Reintroducing Bipartisan Legislation to Ensure Combat Veterans Receive Full Benefits

US Senate News:

Source: United States Senator for Kansas Roger Marshall
Washington – U.S. Senator Roger Marshall, M.D. (R-Kansas) joined Senate Veterans’ Affairs Committee Ranking Member Richard Blumenthal (D-Connecticut) and 41 other Senate cosponsors in reintroducing the bipartisan Major Richard Star Act, which would ensure combat-injured veteran retirees can receive their full benefits.
Under the present rules, more than 50,000 combat-injured military retirees cannot receive the full amount of their Department of Defense (DOD) retirement and Department of Veterans Affairs (VA) disability payments if they do not have disability ratings above 50 percent and more than 20 years of service.
“Despite making unparalleled sacrifices for our nation, some of America’s wounded or disabled veterans have been prevented from receiving the full benefits they earned,” said Senator Marshall. “I urge my colleagues to support the Major Richard Star Act to ensure combat-injured veteran retirees receive what they deserve — full Defense Department retirement and VA disability payments. It’s past time to do right by those who have given so much for our country.”
“This measure corrects one of the deepest injustices in our present veterans’ disability system,” said Senator Blumenthal. “It is unacceptable that tens of thousands of combat-injured veterans are denied the full military benefits they earned. Our bipartisan bill will right this longstanding injustice and finally provide these military retirees who have already sacrificed so much their full VA disability and Defense Department retirement payments.”
“The Major Richard Star Act corrects a severe injustice for combat-wounded veterans,” said Senator Mike Crapo. “The support for this correction is clear. Though the namesake of our legislation is no longer with us, I continue to press for its passage on behalf of the more than 50,000 veterans, including hundreds in Idaho, who stand to benefit.”
“Our veterans put their lives on the line for this country and it’s time our government gives them the full benefits they’ve earned,” said Senator Elizabeth Warren. “The Major Richard Star Act will ensure the federal government keeps its promise to our veterans by allowing them to collect both disability and retirement benefits they earned, even if combat injuries forced them to retire early.”
“I am a proud veteran and the son of a World War II veteran, and I have immense respect for anyone who puts on the uniform to defend our nation,” said Senator Rick Scott. “Our veterans are American heroes who have made countless sacrifices. The Major Richard Star Act ensures our veterans receive the full benefits they’ve earned through their service and sacrifice protecting our nation regardless of length of service. This legislation makes a critical change to treat our veterans fairly and support our nation’s heroes. I urge my colleagues to support its quick passage.”
The legislation is named in honor of Major Richard A. Star, a decorated war veteran who was forced to medically retire due to his combat-related injuries, and who tragically lost his battle with cancer in February 2021.
The House companion version of this bill was introduced by Congressmen Gus Bilirakis (R-FL) and Raul Ruiz (D-CA), with 185 bipartisan cosponsors.
Click HERE to read the full bill text.
The Major Richard Star Act has widespread support from numerous Veteran Service and Military Service organizations, including the Air Force Sergeants Association (AFSA), Air & Space Forces Association (AFA), American GI Forum, The American Legion, American Military Society, American Veterans (AMVETS), Armed Forces Retiree Association, Army Aviation Association of America (AAAA), Association of Military Surgeons of the United States (AMSUS), Association of the United States Army (AUSA), Association of the United States Navy (AUSN), Blinded Veterans Association (BVA), Burn Pits 360, Chief Warrant Officers Association of the US Coast Guard (CWOA), Commissioned Officers Association of the U.S. Public Health Service, Inc. (COA), Disabled American Veterans (DAV), Enlisted Association of the National Guard of the United States, Fleet Reserve Association (FRA), Heroes Athletic Association, Gold Star Wives of America (GSW), Iraq and Afghanistan Veterans of America (IAVA), Jewish War Veterans of the United States of America (JWV), K9s for Warriors, Marine Corps League (MCL), Marine Corps Reserve Association (MCRA), Military Chaplains Association of the United States of America (MCA), Military Officers Association of America (MOAA), Military Order of the Purple Heart (MOPH), Mission Roll Call, National Defense Committee, National Military Family Association (NMFA), Naval Enlisted Reserve Association (NERA), Non-Commissioned Officers Association (NCOA), Operation First Response, Paralyzed Veterans of America (PVA), Quality of Life Foundation, Reserve Organization of America (ROA), Stronghold Freedom Foundation, Tragedy Assistance Program for Survivors (TAPS), The Retired Enlisted Association (TREA), The Independence Fund (TIF), United States Army Warrant Officers Association (USAWOA), USCG Chief Petty Officers Association (CPOA), VetsFirst/United Spinal Association, Vietnam Veterans of America (VVA), Wounded Paw Project, Wounded Warrior Project (WWP).

MIL OSI USA News –

MIL-OSI Russia: IMF Executive Board Concludes 2025 Article IV Consultation with Belgium

Source: IMF – News in Russian

March 20, 2025

Washington, DC: On March 18, 2025, the Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation with Belgium, and considered and endorsed the staff appraisal without a meeting.^{^[1]}

The Belgian economy was resilient to a series of shocks, but growth has been slowing, and core inflation remains persistent. Labor productivity growth remained sluggish, and labor-cost competitiveness has declined. Successive shocks have increased structural fiscal deficits and public debt. Risks arising from deepening geoeconomic fragmentation and intensification of regional conflicts affecting energy, trade and financial spillovers could worsen the outlook.

Executive Board Assessment^[2]

In concluding the 2025 Article IV consultation with Belgium, Executive Directors endorsed staff’s appraisal, as follows:

Notwithstanding its resilience, the Belgium economy faces significant challenges. In the short term, in an increasingly uncertain environment, policies need to see disinflation through while preserving growth and financial stability. From a longer perspective, policies need to rebuild buffers, reduce vulnerabilities associated with high and rising public debt, address spending pressures from aging and the green transition, foster higher growth, and improve the external position which, in 2024, was weaker than implied by medium-term fundamentals and desirable policies based on preliminary assessment. The policy agenda of the new government, which includes significant structural reforms and fiscal consolidation, is an opportunity to make headway. Steady and timely implementation of intended reforms will be key.

Sustained and significant fiscal consolidation is needed. Considering the magnitude of the needed adjustment to bring the deficit durably below 3 percent of GDP and put debt solidly on a downward path, staff supports the government’s intention to pursue a seven-year adjustment under the EGF, which should be accompanied by credible and front-loaded growth-enhancing reforms. An annual reduction in the structural primary balance of about 0.6 ppt of GDP until 2031 will be necessary. The forthcoming MTFSP should be built on sufficiently conservative assumptions to lower the risk of deviating from the intended path of deficit reduction.

The adjustment should rationalize current spending, make room for more public investment, and be supported by increased efficiency of spending. Rationalizing social benefits and the public wage bill is crucial to achieve savings. Public investment should be preserved, or ideally, increased to bolster potential growth and support green transition. Amid competing demands for resources and reduced fiscal space, improving the efficiency of spending, is critical, notably with respect to investment in infrastructure, healthcare, and education.

Fiscal reforms are crucial to support the adjustment. Staff welcomes the government’s intention to reduce the tax burden on labor while introducing capital gain taxation and reducing tax expenditure. Considering the needed overall fiscal adjustment, tax reforms should not result in lower revenue. Similarly, staff welcomes the planned reforms aimed at raising the effective retirement age and reviewing eligibility to specific pension regimes. This is necessary to preserve the sustainability of the pension system despite aging. Staff also encourages the authorities to strengthen the overall fiscal framework, through a revitalized fiscal council and greater accountability of the federal and all federated entities in sharing the burden of fiscal adjustment.

Overall systemic risks in the financial sector remain moderate and current capital buffer requirements and prudential limits on mortgage loans should be maintained. Recent progress in strengthening systemic risk assessment, supervision, the macroprudential framework, and crisis management and resolution preparedness is welcome. With a new government in place, pending measures that required legislative action should now proceed.

Labor market and education reforms are essential to foster higher labor participation and better adequation of skills. The government’s intended reforms to widen the income gap between work and nonwork, limit the duration of unemployment benefits, and reduce the cost of hiring and dismissal go in the right direction. Fostering a labor market more inclusive of low-skilled workers, older workers, women, and individuals with an immigration background, or disabilities, notably through lifelong learning and reskilling and active labor-market policies, will enhance overall economic performance. Education reforms are also necessary to upskill the labor force. They should focus on aligning curricula with the skills companies need, better leveraging teachers’ time, and strengthening support to students in difficulty.

Reforming the wage-setting mechanism will help increase labor-market efficiency and improve competitiveness. Automatic wage and social benefit indexation protected household purchasing power during the inflation shock but increased fiscal deficits and undermined competitiveness. Consideration should be given to abolishing automatic indexation and the 1996 wage law which, together, prevent an optimal allocation of labor and higher employment. At a minimum, the labor market would already benefit from technical reforms to the existing system.

Further product market reforms and efforts with EU partners to deepen the single market and advance the capital market union will support firms’ productivity. Reforms should focus on reducing regulatory and administrative barriers and improving the insolvency regime. Removing remaining barriers to trade within the EU and harmonizing regulations and bankruptcy frameworks would give Belgian firms’ access to a larger customer base, improve competition, and provide buffers against risks from geo-fragmentation. Developing venture capital at the EU level would help widen Belgian firms’ options to finance their growth.

Despite progress, much effort remains needed to achieve climate objectives. The planned expansion of the EU ETS should be complemented by carbon taxation and the phasing out of fossil fuel subsidies, while ensuring support for vulnerable population. The consolidation of federal and regional climate efforts into a coherent and cohesive national strategy is essential.

Belgium: Selected Economic Indicators, 2022–30


			Projections
			Projections

	2022	2023	2024	2025	2026	2027	2028	2029	2030

	(Percent change, unless otherwise indicated)
Real economy
Real GDP 1/	4.2	1.3	1.0	1.1	1.1	1.3	1.3	1.3	1.3
Domestic demand	4.2	1.8	1.0	1.4	1.5	1.5	1.5	1.4	1.5
Private consumption	3.6	0.6	1.8	1.2	1.2	1.5	1.3	1.2	1.1
Public consumption	3.3	3.2	3.2	1.4	1.9	1.6	1.7	1.7	1.7
Gross fixed investment	1.7	3.5	0.9	0.6	1.7	1.5	1.6	1.7	2.0
Stockbuilding 2/	1.1	-0.1	-1.0	0.3	0.0	0.0	0.0	0.0	0.0
Foreign balance 2/	0.1	-0.5	0.1	-0.3	-0.4	-0.2	-0.2	-0.1	-0.1
Exports, goods and services	5.8	-7.1	-4.0	0.0	2.6	3.2	3.2	3.1	3.1
Imports, goods and services	5.8	-6.8	-4.2	0.4	3.3	3.6	3.5	3.3	3.3
Household saving ratio	12.7	14.1	13.6	13.7	13.7	13.7	13.8	14.0	14.3
Potential output growth	2.0	1.8	1.6	1.4	1.3	1.3	1.3	1.3	1.3
Potential output growth	1.3	1.2	1.0	1.3	1.3	1.3	1.3	1.4	1.3
per working age person
Output gap (in percent)	1.6	1.0	0.5	0.2	0.0	0.0	-0.1	0.0	0.0
Employment
Unemployment rate (in percent)	5.6	5.5	5.8	5.7	5.7	5.5	5.6	5.7	5.8
Employment growth	1.9	0.8	0.3	0.2	0.3	0.6	0.3	0.2	0.4
Prices
Consumer prices (HICP)	10.3	2.3	4.3	3.5	2.2	2.0	2.0	1.9	1.9
Core CPI (HICP)	4.0	6.0	3.4	3.0	2.6	2.2	2.1	1.9	1.9
GDP deflator	6.8	4.5	2.7	2.5	1.7	1.5	1.7	1.6	1.6
	(Percent of GDP; unless otherwise indicated)
Public finance
Revenue	48.6	49.1	49.6	49.5	49.5	49.5	49.5	49.6	49.7
Expenditure	52.2	53.3	54.0	54.3	55.0	55.3	55.7	56.3	56.9
General government balance	-3.6	-4.2	-4.4	-4.8	-5.5	-5.8	-6.2	-6.7	-7.2
Structural balance	-4.3	-4.4	-4.5	-4.8	-5.5	-5.8	-6.1	-6.8	-7.2
Structural balance (excl. Covid measures)	-3.7	-4.3	-4.4	-4.8	-5.5	-5.8	-6.1	-6.8	-7.2
Structural primary balance	-2.7	-2.4	-2.2	-2.5	-3.0	-3.0	-3.2	-3.5	-3.7
Primary balance	-2.0	-2.2	-2.2	-2.4	-3.0	-3.0	-3.3	-3.4	-3.7
General government debt	102.6	103.1	104.1	105.4	108.6	111.9	115.2	118.9	123.0
External Sector
Goods and services balance	-1.5	-0.6	-0.1	0.0	0.0	0.0	0.3	0.5	0.7
Current account	-1.3	-0.7	-0.3	-0.3	-0.3	-0.3	-0.1	0.1	0.2
Exchange rates
Euro per U.S. dollar, period average	0.9	0.9	0.9	…	…	…	…	…	…
NEER, ULC-styled (2005=100)	96.3	97.6	97.8	…	…	…	…	…	…
REER, ULC-based (2005=100)	99.7	103.8	105.5	…	…	…	…	…	…
Memorandum items
Gross national savings (in percent of GDP)	25.6	24.6	23.8	23.9	23.9	23.9	24.1	24.3	24.5
Gross national investment	26.9	25.3	24.1	24.2	24.3	24.3	24.2	24.2	24.3
(in percent of GDP)
Nominal GDP (in billions of euros)	563.5	596.3	618.6	640.9	658.7	677.3	697.8	718.4	739.8
Population (in millions)	11.6	11.7	11.8	11.8	11.9	11.9	11.9	12.0	12.0

Sources: Haver Analytics, Belgian authorities, and IMF staff projections.
1/ Based on national accounts data available as of January 29, 2025.
2/ Contribution to GDP growth.

[1] Under Article IV of the IMF’s Articles of Agreement, the IMF holds bilateral discussions with members, usually every year. A staff team visits the country, collects economic and financial information, and discusses with officials the country’s economic developments and policies. On return to headquarters, the staff prepares a report, which forms the basis for discussion by the Executive Board.

[2] The Executive Board takes decisions under its lapse-of-time procedure when the Board agrees that a proposal can be considered without convening formal discussions.

IMF Communications Department

MEDIA RELATIONS

PRESS OFFICER: Eva Graf

Phone: +1 202 623-7100Email: MEDIA@IMF.org

https://www.imf.org/en/News/Articles/2025/03/19/pr25070-belgium-imf-executive-board-concludes-2025-article-iv-consultation-with-belgium

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MIL-OSI: Alarum Technologies Announces Fourth Quarter and Annual 2024 Results

Source: GlobeNewswire (MIL-OSI)

A Pivotal Year, Marking Accomplishment of Strategic Shift to Data Collection,
Hits Milestones Toward Becoming a Driving Force in the AI Revolution

2024 revenue increased to $31.8 million, of which $7.4 million was in the fourth quarter;
2024 net profit rose to $5.8 million and adjusted EBITDA reached $9.4 million;
Cash and liquid investments balance at year-end amounted to $25 million

TEL AVIV, Israel, March 20, 2025 (GLOBE NEWSWIRE) — Alarum Technologies Ltd. (Nasdaq, TASE: ALAR) (“Alarum” or the “Company”), a global provider of web data collection solutions, today announced financial results for the fourth quarter and full year ended December 31, 2024.

Shachar Daniel, Chief Executive Officer of Alarum, said: “2024 was a landmark year for Alarum, as we successfully executed our strategic vision, to focus on data collection. This transformation comes at a time when AI is reshaping the world at an unprecedented pace. As data fuels intelligence, the companies that will lead this revolution are those that anticipate change, build a strong foundation, and position themselves for long-term success. This is exactly what we are striving for – taking it step by step.”

Market Trends Shaping Business Short-and Long-Term

Alarum Engaged in AI Model Training Trial Projects: as AI trends accelerated toward the end of 2024, collecting accurate data at massive scales has become increasingly critical. In the fourth quarter of 2024 and the first quarter of 2025, leading global companies, including one of the world’s largest online marketplace corporates, have selected Alarum’s Data Collection solutions for initial AI model training of mega-scale trial projects.
Industry Trends and Market Dynamics: With the growing demand for data, AI companies and data providers are forced to adapt to a rapidly evolving landscape, with websites implementing new technological barriers to data collection. This dynamic environment has led to revenue fluctuation across the industry. Alarum’s financial strength and operational efficiency allow it to capitalize on long-term market growth, leveraging its robust technological foundation, established customer base, and strategic engagements with industry leaders.
Financial Resilience: Alarum’s solid balance sheet and efficient operations enable it to stay ahead of the competition, seize opportunities promptly and adapt its long-term plans as required.
Long-term Product Strategy and Vision: Evolving market needs validate Alarum’s focus on in-depth research and aligned roadmaps. Recognizing the current era as a paramount opportunity, the Company continues to prioritize and allocate resources to seize and focus mainly on long-term growth opportunities, aiming to elevate its position to the next level.

Recent Developments and Business Highlights

Network Expansion: Alarum significantly scaled its IP network (IPPN) infrastructure in 2024, reinforcing its position as a key player in large-scale data collection. Its leadership was also acknowledged in the comprehensive public report on the IPPN industry, the 2024 PROXYWAY Market Research¹, which named Alarum’s NetNut Ltd. (“NetNut”) as a top performer.
Introducing Innovative Data Collection & Labeling Solutions: Alarum has introduced cutting-edge solutions, designed to provide seamless and scalable access to high-quality data. In the second half of 2024, the Company recorded initial sales from the Website Unblocker and SERP API (Search Engine Results Page Application Programming Interface) products, and it also made progress with the development of an AI Data Collector.
NetNut’s Net Retention Rate (“NRR”)² reached 1.27 as of December 31, 2024, compared to 1.53 as of December 31, 2023, yet another consecutive quarter of achieving an NRR well-above 1.

Chen Katz, Chairman of The Board of Alarum, commented: “Our 2024 results showcase the success of our strategic shift, which is well supported by our financial resilience. With a sharp focus on data collection, we have built a solid foundation for long term sustainability in the AI data-driven era. I am excited to see how our continued innovation and execution will shape the future of our company.”


Summary of Financial Results³
(in millions of U.S. dollars, rounded, except per share amounts and margins)

	For the Year Ended December 31,						For the Three Months Ended December 31,
	2024			2023			2024			2023
	(Audited)			(Audited)			(Unaudited)			(Unaudited)

Total Revenue		31.8			26.5			7.4			7.1
of which, Web Data Collection Revenue was		30.9			21.3			7.2			6.7
Gross profit		23.9			18.8			5.3			5.3
Gross margin (in percentage)		75.1	%		70.9	%		72.4	%		75.0	%
Non-IFRS gross margin (in percentage)		77.0	%		74.3	%		74.3	%		77.2	%
Total operating expenses		17.2			24.3			5.0			3.6
Financial income (expense), net		0.3			(0.6	)		0.2			(0.1	)
Tax benefit (expense)		(1.2	)		0.5			(0.1	)		(*	)
Net profit (loss) from continuing operations		5.8			(5.6	)		0.4			1.7
Adjusted EBITDA from continuing operations		9.4			5.2			1.5			2.2
Basic earnings (loss) per ADS from continuing operations (in U.S. dollars)	$	0.87		$	(1.35	)	$	0.06		$	0.28
Non-IFRS basic earnings (loss) per American Depository Share (“ADS”) from continuing operations (in U.S. dollars)	$	1.26		$	(1.14	)	$	0.20		$	0.38

Cash, cash equivalents and debt investments (including accrued interest)⁴		25.0			10.9			25.0			10.9
Shareholders’ equity³		26.4			13.2			26.4			13.2

* Less than $0.1 million

Fourth Quarter and Full Year 2024 Financial Analysis

Revenue in Q4 2024 grew 4% year-over-year to $7.4 million (Q4 2023: $7.1 million). The increase is attributed to our NetNut web data collection business, which grew 7% to $7.2 million in Q4 2024, up from $6.7 million in Q4 2023. Revenue for the whole year 2024 grew 20%, rising to a record of $31.8 million (2023: $26.5 million). The Web Data Collection revenue reached a Company record $30.9 million in 2024, achieving 45% year-over-year growth (2023: $21.3 million).
Cost of revenue in Q4 2024 was $2.0 million (Q4 2023: $1.8 million). Full year 2024, cost of revenue was $7.9 million, (2023: $7.7 million). During these periods, costs have shifted towards investment in the Company’s IP network, as per its strategic decision announced in July 2023 to focus solely on its web data collection business.
Operating expenses in Q4 2024 totalled $5.0 million (Q4 2023: $3.6 million). The quarterly change was driven mainly by the increase in the NetNut Data Collection operations, primarily research and development salary costs. For the full year 2024, operating expenses were down to $17.2 million (2023: $24.3 million), mainly due to 2023-related impairment costs of goodwill and intangible assets and the strategic decision to scale down the Company’s consumer internet access business operations, partially offset by the increase in Data Collection operating expenses.
Financial income, net, in Q4 2024 was $0.2 million (Q4 2023: financial expense, net, of $0.1 million). Financial income, net, for 2024, increased to $0.3 million (2023: financial expense, net, of $0.6 million). This shift to financial income, net, from an expense, net, was mainly due to the increase in interest income from cash deposits as well as lower financial expenses related to short- and long-term loans.
2024 cash flow from operating activities rose 93%, to $8.9 million, compared to last year (2023: $4.6 million).
Bottom line, 2024 net profit from continuing operations rose to a record $5.8 million (2023: loss of $5.6 million), and the corresponding 2024 Adjusted EBITDA was up at a Company record $9.4 million (2023: $5.2 million).
As of December 31, 2024, shareholders’ equity doubled, totalling $26.4 million, up from $13.2 million as of December 31, 2023. The increase was driven by the switch to net profit from net loss as well as warrants and options exercises.
Outstanding ordinary share count as of December 31, 2024, was approximately 69.1 million shares, or 6.9 million in ADSs.

Financial Outlook

“In line with our guidance, total fourth quarter 2024 revenues increased to $7.4 million, of which $7.2 million were attributed to Web Data Collection, and fourth quarter 2024 Adjusted EBITDA reached $1.5 million. Our cash and liquid investment balance on December 31, 2024, increased to $25 million, demonstrating once again success in cashflow generation,” said Mr. Shai Avnit, Chief Financial Officer of Alarum.

“As we look ahead, our revenue guidance reflects the ongoing shifts in the global data collection. First quarter 2025 revenues are estimated at $7.3 million ±3% and Adjusted EBITDA for the first quarter 2025 is expected to range from $0.8 million to $1.2 million. We are navigating a period of adjustment as the industry evolves, and while short-term revenue growth may be lower than in previous quarters, we remain focused on the bigger picture, and on generating long-term and sustainable value for the Company’s stakeholders,” Mr. Avnit concluded.

We are unable to present a reconciliation of our estimated Adjusted EBITDA to net profit from continuing operations as we are unable to predict with reasonable certainty, and without unreasonable effort, the impact and timing of certain expenses on our net profit from continuing operations. The financial impact of these expenses is uncertain and is dependent on various factors, including timing, and could be material to our consolidated statements of profit or loss and other comprehensive income (loss).

Fourth Quarter 2024 Financial Results Conference Call

Mr. Shachar Daniel, Chief Executive Officer of Alarum, and Mr. Shai Avnit, Chief Financial Officer of Alarum, will host a conference call today, March 20, 2025, at 8:30 a.m. ET, 5:30 a.m. Pacific time, 2:30 p.m. Israel, to discuss the fourth quarter and full year 2024 results and the first quarter 2025 outlook, followed by a Q&A session. To attend, please dial one of the following numbers, at least five minutes before the call starts: 1-877-407-0789 or 1-201-689-8562. If you are unable to connect using the toll-free number, please try the international dial-in number. An Israeli toll-free number is: 1 809 406 247. Participants will be required to state their name and company upon dialling in.

Replay: The conference call will be broadcast live and available for replay here, after 11:30 a.m. ET on March 20, 2025, through April 20, 2025. Toll-free replay numbers: 1-844-512-2921 or 1-412-317-6671, ID: 13751807.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the “safe harbor” words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates” and similar expressions or variations of such words are intended to identify forward-looking statements. For example, Alarum is using forward-looking statements in this press release when it discusses strategic vision, benefits, advantages and capabilities of Alarum’s solutions, the growing demand for data, that Alarum’s financial strength and operational efficiency allow it to capitalize on long-term market growth, that Alarum’s solid balance sheet and efficient operations enable it to stay ahead of the competition, seize opportunities promptly and adapt its long-term plans as required, that the Company continues to prioritize and allocate resources to seize and focus mainly on long-term growth opportunities and its aim to elevate its position to the next level, the estimates of the revenues for the first quarter 2025 revenues and Adjusted EBITDA, that short-term revenue growth may be lower than in previous quarters, and the Company’s focus on the bigger picture, and on generating long-term and sustainable value for the Company’s stakeholders. Because such statements deal with future events and are based on Alarum’s current expectations, they are subject to various risks and uncertainties and actual results, performance or achievements of Alarum could differ materially from those described in or implied by the statements in this press release. The forward-looking statements contained or implied in this press release are subject to other risks and uncertainties, including those discussed under the heading “Risk Factors” in Alarum’s annual report on Form 20-F filed with the Securities and Exchange Commission (“SEC”) on March 20, 2025, and in any subsequent filings with the SEC. Except as otherwise required by law, Alarum undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. References and links to websites have been provided as a convenience, and the information contained on such websites is not incorporated by reference into this press release. Alarum is not responsible for the contents of third-party websites.


Condensed Consolidated Statements of Financial Position
(in thousands of U.S. dollars)

	December 31,
	2024		2023
	(Audited)
Assets
Current assets:
Cash and cash equivalents	15,081		10,872
Trade receivables, net	3,231		1,994
Other receivables	503		399
	18,815		13,265

Non-current assets:
Long-term deposits	121		104
Other non-current assets	85		145
Property and equipment, net	130		88
Right-of-use assets	498		779
Deferred tax assets	422		181
Debt investments at fair value through other comprehensive income	9,256		–
Debt investments at fair value through profit or loss	555		–
Intangible assets, net	811		1,386
Goodwill	4,118		4,118
Total non-current assets	15,996		6,801
Total assets	34,811		20,066

Liabilities and equity
Current liabilities:
Trade payables	251		369
Other payables	4,484		2,439
Current maturities of long-term loan	938		290
Contract liabilities	1,987		1,983
Derivative financial instruments	148		109
Short-term lease liabilities	359		370
Total current liabilities	8,167		5,560

Non-current liabilities:
Long-term lease liabilities	261		523
Long-term loans, net of current maturities	32		802
Total non-current liabilities	293		1,325
Total liabilities	8,460		6,885

Equity:
Ordinary shares	–		–
Share premium	111,892		100,576
Other equity reserves	11,012		14,938
Accumulated deficit	(96,553	)	(102,333	)
Total equity	26,351		13,181
Total liabilities and equity	34,811		20,066


Condensed Consolidated Statements of Profit or Loss
(in thousands of U.S. dollars, except per share amounts)

	For the Year Ended December 31,					For the Three Months Ended December 31,
	2024			2023		2024		2023
	(Audited)			(Audited)		(Unaudited)		(Unaudited)
Continuing operations
Revenue		31,824		26,521		7,370		7,107
Cost of revenue		7,915		7,711		2,032		1,778
Gross profit		23,909		18,810		5,338		5,329

Operating expenses:
Research and development		4,495		3,557		1,210		795
Sales and marketing		7,033		10,035		1,988		1,579
General and administrative		5,661		4,406		1,749		1,207
Impairment of goodwill		–		6,311		–		–
Total operating expenses		17,189		24,309		4,947		3,581

Operating profit (loss)		6,720		(5,499	)	391		1,748

Financial income (expense), net		281		(590	)	163		(54	)
Profit (loss) from continuing operations before income tax		7,001		(6,089	)	554		1,694
Tax benefit (expense)		(1,221	)	482		(112	)	(22	)
Profit (loss) from continuing operations, net of income tax		5,780		(5,607	)	442		1,672
Profit from discontinued operations, net of income tax		–		82		–		–
Net profit (loss) for the period		5,780		(5,525	)	442		1,672
Other comprehensive income (loss) for the period Change in fair value of debt investments		(80	)	–		(80	)	–
Total comprehensive income (loss) for the period		5,700		(5,525	)	362		1,672

Basic profit (loss) per share:
Continuing operations	$	0.09		(0.14	)	0.01		0.03

Discontinued operations		–		*		–		–
	$	0.09		(0.14	)	0.01		0.03

Diluted profit (loss) per share:
Continuing operations	$	0.08		(0.14	)	0.01		0.03

Discontinued operations		–		*		–		–
	$	0.08		(0.14	)	0.01		0.03

Basic profit (loss) per ADS:

Continuing operations	$	0.87		(1.35	)	0.06		0.28

Discontinued operations		–		*		–		–
	$	0.87		(1.35	)	0.06		0.28
* Less than $0.01

Use of Non-IFRS Financial Results

In addition to disclosing financial results calculated in accordance with International Financial Reporting Standards (IFRS), as issued by the International Accounting Standards Board, this press release contains non-IFRS financial measures of EBITDA (EBITDA loss), Adjusted EBITDA (Adjusted EBITDA loss), non-IFRS net profit (loss), non-IFRS gross profit, non-IFRS gross margin and non-IFRS basic earnings (loss) per share or ADS for the periods presented. The Company defines EBITDA (EBITDA loss) as net profit (loss) from continuing operations before depreciation, amortization and impairment of intangible assets, financial income (expense) and income tax; defines Adjusted EBITDA (Adjusted EBITDA loss) as EBITDA (EBITDA loss) as further adjusted to remove the impact of (i) impairment of goodwill (if any); and (ii) share-based compensation; defines non-IFRS net profit (loss) as net profit (loss) from continuing operations before depreciation, amortization and impairment of intangible assets, impairment of goodwill, financial income (expense) effects primarily related to derivative financial instruments as well as long-term loans, deferred tax effects and share-based compensation; defines non-IFRS gross profit as gross profit from continuing operations adjusted to remove the impact of depreciation, amortization and impairment of intangible assets and share-based compensation recorded under cost of revenues; defines non-IFRS gross margin as the percentage of the non-IFRS gross profit out of revenues; and defines non-IFRS basic earnings (loss) per share or ADS as non-IFRS net profit (loss) divided by the weighted average number of ordinary shares or ADSs. The Company’s management believes the non-IFRS financial information provided in this press release is useful to investors’ understanding and assessment of the Company’s ongoing operations. Management also uses both IFRS and non-IFRS information in evaluating and operating its business internally, and as such deemed it important to provide this information to investors. The non-IFRS financial measures disclosed by the Company should not be considered in isolation, or as a substitute for, or superior to, financial measures calculated in accordance with IFRS, and the financial results calculated in accordance with IFRS and reconciliations to those financial statements should be carefully evaluated. Investors are encouraged to review the reconciliations of these non-IFRS measures to their most directly comparable IFRS financial measures provided in the financial statement tables herein.

Other Metrics

Net retention rate (NRR) is a key indicator of customer base health and revenue expansion. It is based on NRR point in time, which measures the revenue growth of customers over the past four quarters, compared to the revenue generated from these customers during the same period a year earlier.
NRR is calculated as an average of the NRR points in time for the end of the current period and the three preceding quarters.
NRR > 1 (or 100%): Indicates revenue growth driven by existing customers, where upsells and cross-sells outweigh churn.
NRR < 1 (or 100%): Shows revenue loss due to churn exceeding gains from upsells or cross-sells.

Non-IFRS Financial Measures
(in millions of U.S. dollars, rounded)

The following tables present the reconciled effect of the above on the Company’s Adjusted EBITDA (EBITDA loss); non-IFRS net profit (loss); and non-IFRS gross profit for the year and three months ended December 31, 2024 and 2023:

	For the Year Ended December 31,				For the Three Months Ended December 31,
	2024		2023		2024		2023

Net profit (loss) from continuing operations	5.8		(5.6	)	0.4		1.7
Adjustments:
Depreciation, amortization and impairment of intangible assets	0.6		3.5		0.2		0.1
Financial expense (income), net	(0.4	)	0.6		(0.1	)	0.1
Tax expense (benefit)	1.4		(0.5	)	0.1		*
EBITDA (EBITDA loss)	7.4		(2.0	)	0.6		1.9
Adjustments:
Impairment of goodwill	–		6.3		–		–
Share-based compensation	2.0		0.9		0.9		0.3
Adjusted EBITDA for the period	9.4		5.2		1.5		2.2
* Less than $0.1 million


	For the Year Ended December 31,				For the Three Months Ended December 31,
	2024		2023		2024		2023
Net profit (loss) from continuing operations	5.8		(5.6	)	0.4		1.7
Adjustments:
Depreciation, amortization and impairment of intangible assets	0.6		3.5		0.2		0.1
Financial expense (income), net effects	0.1		0.1		(*	)	0.2
Deferred tax effects	(0.1	)	(0.5	)	(0.1	)	*
Impairment of goodwill	–		6.3		–		–
Share-based compensation	2.0		0.9		0.9		0.3
Non-IFRS net profit for the period	8.4		4.7		1.4		2.3
* Less than $0.1 million


	For the Year Ended December 31,		For the Three Months Ended December 31,
	2024	2023	2024	2023
Gross profit from continuing operations	23.9	18.8	5.3	5.3
Adjustments:
Depreciation, amortization and impairment of intangible assets	0.6	0.9	0.2	0.2
Share-based compensation	*	*	*	*
Non-IFRS gross profit for the period	24.5	19.7	5.5	5.5
* Less than $0.1 million

About Alarum Technologies Ltd.

Alarum Technologies Ltd. (Nasdaq, TASE: ALAR) is a global provider of web data collection solutions, empowering organizations to gain a competitive edge by streamlining the collection, extraction, and analysis of large-scale structured data from public online sources. Our data collection solutions by NetNut, are based on our world’s fastest and most advanced and secured hybrid proxy network, which comprises both exit points based on our proprietary reflection technology and hundreds of servers located at our ISP partners around the world. Pushing the boundaries of innovation in data collection, we are building a robust platform, complemented by the Website Unblocker, Data Collector, Data Sets and AI data collector. As the impact of the AI revolution unfolds, Alarum, with its robust market-leading data collection offerings is preparing itself to play a meaningful role as the world reshapes in a new form.

For more information about Alarum and its web data collection solutions, please visit www.alarum.io.

Follow us on Twitter

Investor Relations Contact:
investors@alarum.io

________________________
¹https://proxyway.com/research/proxy-market-research-2024
² See definition under “Other Metrics”
³ The table below contains certain non-IFRS financial measures. See “Use of Non-IFRS Financial Results” for additional information regarding these measures and reconciliations to the most comparable IFRS measures.
⁴ As of the last day of the period.

MIL-OSI: FactSet Reports Results for Second Quarter 2025

Source: GlobeNewswire (MIL-OSI)

Q2 GAAP revenues of $570.7 million, up 4.5% from Q2 2024.
Organic Q2 ASV of $2,276.2 million, up 4.1% year over year.
Q2 GAAP operating margin of 32.5%, down approximately 80 bps year over year, and adjusted operating margin of 37.3%, down 100 bps year over year.
Q2 GAAP diluted EPS of $3.76, up 3.0% from the prior year, and adjusted diluted EPS of $4.28, up 1.4% year over year.
Fiscal 2025 guidance updated. Expected organic ASV growth of $100 million to $130 million (approximately 4.4% to 5.8%), GAAP revenues in the range of $2,305 million to $2,325 million, adjusted operating margin in the range of 36% to 37%, and adjusted diluted EPS in the range of $16.80 to $17.40.

NORWALK, Conn., March 20, 2025 (GLOBE NEWSWIRE) — FactSet (“FactSet” or the “Company”) (NYSE:FDS) (NASDAQ:FDS), a global financial digital platform and enterprise solutions provider, today announced results for its second quarter fiscal 2025 ended February 28, 2025.

Second Quarter Fiscal 2025 Highlights

GAAP revenues increased 4.5%, or $24.8 million, to $570.7 million for the second quarter of fiscal 2025 compared with $545.9 million in the prior year period. Organic⁽¹⁾ revenues grew 4.0% year over year to $568.0 million during the second quarter of fiscal 2025. Growth in GAAP and Organic revenues this quarter was driven by wealth and institutional buy-side clients.
Annual Subscription Value (“ASV”) was $2,306.1 million at February 28, 2025, compared with $2,185.6 million at February 29, 2024. Organic ASV was $2,276.2 million at February 28, 2025, up 4.1% or $90.7 million year over year⁽²⁾.
Organic ASV increased $19.6 million over the last three months. Please see the “ASV” section of this press release for details.
GAAP operating margin decreased to 32.5% compared with 33.3% for the prior year period, mainly due to an increase in acquisition-related professional fees and technology-related expenses, partially offset by growth in revenues and a decrease in employee compensation costs. Adjusted operating margin decreased to 37.3% compared with 38.3% in the prior year period, mainly due to higher technology related expenses offset by lapping of the prior year’s lower bonus accrual.
GAAP diluted earnings per share (“EPS”) increased 3.0% to $3.76 compared with $3.65 for the same period in fiscal 2024, primarily due to growth in revenues, partially offset by an increase in acquisition-related professional fees and technology-related expenses. Adjusted diluted EPS increased 1.4% to $4.28 compared with $4.22 in the prior year period, driven by growth in revenues, offset by higher operating expenses and a higher tax rate on an adjusted basis.
Net cash provided by operating activities was $174.0 million for the second quarter of fiscal 2025. Free cash flow increased to $150.2 million for the second quarter of fiscal 2025, compared with $121.9 million for the prior year period, an increase of 23.3%, primarily due to higher net cash provided by operating activities.

GAAP effective tax rate for the second quarter of fiscal 2025 decreased to 15.9% compared with 16.4% for the second quarter of fiscal 2024. The decrease was primarily due to lower U.S. tax on foreign earnings, partially offset by certain discrete items, mainly lower excess tax benefits related to stock-based compensation.

^{(1) References to “organic” figures in this press release exclude the current year impact of acquisitions and dispositions completed within the past 12 months and the current year impact from changes in foreign currency.}

^{(2) Beginning in fiscal 2025, FactSet is reporting Organic ASV, rather than Organic ASV plus Professional Services, to focus on the recurring nature of its revenues. This underscores the shift of FactSet’s offerings toward providing more managed services and less project-based services.}

“With increased visibility into the remainder of the fiscal year, we are reaffirming the 5% midpoint of our organic ASV growth guidance and narrowing the range of anticipated top-line outcomes,” said Phil Snow, CEO of FactSet. “The strength of our full-year pipeline and constructive dialogue with our clients position our business positively for growth acceleration in the second half of the year.”

Key Financial Measures*

(Condensed and Unaudited)	Three Months Ended
	February 28,			February 29,
(In thousands, except per share data)		2025			2024		Change
Revenues	$	570,660		$	545,945		4.5	%
Organic revenues	$	567,985		$	545,945		4.0	%
Operating income	$	185,492		$	181,942		2.0	%
Adjusted operating income	$	212,669		$	209,326		1.6	%
Operating margin		32.5	%		33.3	%
Adjusted operating margin		37.3	%		38.3	%
Net income	$	144,860		$	140,940		2.8	%
Adjusted net income	$	164,976		$	163,067		1.2	%
EBITDA	$	224,646		$	216,826		3.6	%
Diluted EPS	$	3.76		$	3.65		3.0	%
Adjusted diluted EPS	$	4.28		$	4.22		1.4	%

^{* See reconciliation of U.S. GAAP to adjusted key financial measures in the back of this press release.}

“We achieved solid financial performance in the first half of the fiscal year by maintaining our focus on cost discipline and increased efficiency, while continuing to invest in our strategic priorities,” said Helen Shan, FactSet’s CFO. “We are reaffirming our guidance range for adjusted operating margin and adjusted diluted EPS, despite modest dilution from our recent acquisitions.”

Annual Subscription Value (ASV)

ASV at any given point in time represents the forward-looking revenues for the next 12 months from all subscription services currently supplied to clients.

ASV was $2,306.1 million at February 28, 2025, compared with $2,185.6 million at February 29, 2024. Organic ASV was $2,276.2 million at February 28, 2025, up $90.7 million from the prior year, for a growth rate of 4.1%. Organic ASV increased $19.6 million over the last three months.

The buy-side and sell-side organic ASV annual growth rates as of February 28, 2025 were 4.1% and 2.2%, respectively. Buy-side clients, including institutional asset managers, wealth managers, asset owners, partners, hedge funds and corporate clients, accounted for 82% of organic ASV. The remaining organic ASV came from sell-side firms, including broker-dealers, banking and advisory firms, and private equity and venture capital firms. Supplementary tables covering organic buy-side and sell-side ASV growth rates may be found on the last page of this press release.

Segment Revenues and ASV

ASV from the Americas was $1,501.1 million compared with ASV in the prior year period of $1,413.6 million. Organic ASV from the Americas increased 4.4% to $1,474.9 million. Americas revenues for the quarter increased to $369.7 million compared with $352.6 million in the second quarter of last year. The Americas quarterly organic revenues growth rate was 4.0% over the prior year period.

ASV from EMEA was $571.3 million compared with ASV in the prior year period of $556.5 million. Organic ASV from EMEA increased 2.6% to $571.4 million. EMEA revenues were $143.4 million compared with $139.2 million in the second quarter of fiscal 2024. The EMEA quarterly organic revenues growth rate was 3.1% over the prior year period.

ASV from Asia Pacific was $233.7 million compared with ASV in the prior year period of $215.5 million. Organic ASV from Asia Pacific increased 6.8% to $229.9 million. Asia Pacific revenues were $57.6 million compared with $54.1 million in the second quarter of fiscal 2024. The Asia Pacific quarterly organic revenues growth rate was 6.8% over the prior year period.

Operational Highlights – Second Quarter Fiscal 2025

Client count as of February 28, 2025 was 8,645, a net increase of 396 clients in the past three months, mainly due to corporates, which now includes clients from the Irwin acquisition. The count includes clients with ASV of $10,000 and more and does not reflect the LiquidityBook acquisition.
User count was 219,141 as of February 28, 2025, a net increase of 874 users in the past three months, mainly driven by an increase in wealth management users. The user count does not reflect the Irwin and LiquidityBook acquisitions.
Annual ASV retention was greater than 95%. When expressed as a percentage of clients, annual retention was 91%.
Employee headcount was 12,598 as of February 28, 2025, up 2.6% over the last 12 months, with the increase primarily in the sales and technology groups, mainly from the Irwin and LiquidityBook acquisitions. FactSet’s Centers of Excellence account for approximately 67% of the Company’s employees.
A quarterly dividend of $39.5 million, or $1.04 per share, is being paid on March 20, 2025, to holders of record of FactSet’s common stock at the close of business on February 28, 2025.
FactSet acquired LiquidityBook, a provider of cloud-native trading solutions. The acquisition adds technology-forward order management (OMS) and investment book of record (IBOR) capabilities to the FactSet Workstation to seamlessly link adjacent steps in the front office trade workflow and enhance FactSet’s ability to serve the integrated workflow needs of clients across the entire portfolio lifecycle.
FactSet launched Pitch Creator, an AI-powered tool that streamlines pitchbook creation for investment banks. By automating the time-consuming tasks of model analysis and presentation building, FactSet Pitch Creator can reduce hours of manual work into minutes, creating the productivity gains necessary for junior bankers to prioritize high-value, strategic initiatives.
After the quarter end, FactSet acquired LogoIntern, a productivity solution that helps financial services professionals create well formatted logo outputs for presentations faster. This acquisition reinforces FactSet’s commitment to improving junior banker productivity and complements Pitch Creator to bring automation to another time-consuming, manual aspect of a junior banker’s daily workflow.
FactSet appointed Kevin Toomey as Head of Investor Relations. Toomey is replacing Yet He, who was acting as Interim Head of Investor Relations and now will continue in his role as FactSet’s Treasurer and Head of Financial Planning & Analysis.

Share Repurchase Program

FactSet repurchased 136,714 shares of its common stock for $64.4 million at an average price of $470.70 during the second quarter of fiscal 2025 under the Company’s share repurchase program. As of February 28, 2025, $186.9 million remained available for share repurchases under this program.

Annual Business Outlook

FactSet is updating its outlook for fiscal 2025. The following forward-looking statements reflect FactSet’s expectations as of today’s date. Given the risk factors, uncertainties, and assumptions discussed below, actual results may differ materially. FactSet does not intend to update its forward-looking statements prior to its next quarterly results announcement.

Fiscal 2025 Expectations (with reference to most recent previous guidance):

Organic ASV is expected to grow in the range of $100 million to $130 million during fiscal 2025 (narrowing from $90 million to $140 million).
GAAP revenues are expected to be in the range of $2,305 million to $2,325 million (up from $2,285 million to $2,305 million).
GAAP operating margin is expected to be in the range of 32.0% to 33.0% (down from 32.5% to 33.5%).
Adjusted operating margin is expected to be in the range of 36.0% to 37.0% (unchanged).
FactSet’s annual effective tax rate is expected to be in the range of 17% to 18% (unchanged).
GAAP diluted EPS is expected to be in the range of $14.80 to $15.40 (down from $15.10 to $15.70).
Adjusted diluted EPS is expected to be in the range of $16.80 to $17.40 (unchanged).

Adjusted operating margin and adjusted diluted EPS guidance do not include certain effects of any non-recurring benefits or charges that may arise in fiscal 2025. Please see the back of this press release for a reconciliation of GAAP to adjusted metrics.

Conference Call

Second Quarter 2025 Conference Call Details

Please register for the conference call using the above link before the call start time. The conference call platform will register your name and organization and provide dial-in numbers and a unique access pin. The conference call will have a live Q&A session.

A replay will be available on the Company’s investor relations website after 11:00 a.m. Eastern Time on March 20, 2025, through March 20, 2026. The earnings call transcript will be available via FactSet CallStreet.

Forward-looking Statements

This news release contains forward-looking statements based on management’s current expectations, estimates, forecasts and projections about industries in which FactSet operates and the beliefs and assumptions of management. All statements that address expectations, guidance, outlook or projections about the future, including statements about the Company’s strategy for growth, product development, revenues, future financial results, anticipated growth, market position, subscriptions, expected expenditures, trends in FactSet’s business and financial results, are forward-looking statements. Forward-looking statements may be identified by words like “may,” “might,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “intends,” “projects,” “indicates,” “predicts,” “potential,” or “continue,” and similar expressions. These statements are not guarantees of future performance and involve a number of risks, uncertainties and assumptions. Many factors, including those discussed more fully elsewhere in this release and in FactSet’s filings with the Securities and Exchange Commission, particularly its latest annual report on Form 10-K and quarterly reports on Form 10-Q, as well as others, could cause results to differ materially from those stated. Forward-looking statements speak only as of the date they are made, and FactSet assumes no duty to and does not undertake to update forward-looking statements. Actual results could differ materially from those anticipated in forward-looking statements and future results could differ materially from historical performance.

About Non-GAAP Financial Measures

Financial measures in accordance with U.S. GAAP, including revenues, operating income and margin, net income, diluted earnings per share and cash provided by operating activities, have been adjusted.

FactSet uses these adjusted financial measures both in presenting its results to stockholders and the investment community and in its internal evaluation and management of the business. The Company believes that these adjusted financial measures and the information they provide are useful to investors because they permit investors to view the Company’s performance using the same tools that management uses to gauge progress in achieving its goals. Investors may benefit from referring to these adjusted financial measures in assessing the Company’s performance and when planning, forecasting and analyzing future periods, and may also facilitate comparisons to its historical performance. The presentation of this financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP.

Organic revenues excludes the current year impact of revenues from acquisitions and dispositions completed within the past 12 months and the current year impact from changes in foreign currency. Adjusted operating income and margin, adjusted net income, and adjusted diluted earnings per share exclude acquisition-related intangible asset amortization and non-recurring items. EBITDA represents earnings before interest expense, provision for income taxes and depreciation and amortization expense, while adjusted EBITDA further excludes non-recurring non-cash expenses. The Company believes that these adjusted financial measures help to fully reflect the underlying economic performance of FactSet.

Cash flows provided by operating activities have been reduced by purchases of property, equipment, leasehold improvements and capitalized internal-use software to report non-GAAP free cash flow. FactSet uses this financial measure both in presenting its results to stockholders and the investment community and in the Company’s internal evaluation and management of the business. Management believes that this financial measure is useful to investors because it is an indication of cash flow that may be available to fund further investments in future growth initiatives.

About FactSet

FactSet (NYSE:FDS | NASDAQ:FDS) helps the financial community to see more, think bigger, and work better. Our digital platform and enterprise solutions deliver financial data, analytics, and open technology to more than 8,600 global clients, including over 219,000 individual users. Clients across the buy-side and sell-side as well as wealth managers, private equity firms, and corporations achieve more every day with our comprehensive and connected content, flexible next-generation workflow solutions, and client-centric specialized support. As a member of the S&P 500, we are committed to sustainable growth and have been recognized amongst the Best Places to Work in 2023 by Glassdoor as a Glassdoor Employees’ Choice Award winner. Learn more at www.factset.com and follow us on X and LinkedIn.

FactSet
Investor Relations Contact:
Yet He
+1.212.973.5701
yet.he@factset.com

Media Contact:
Megan Kovach
+1.512.736.2795
megan.kovach@factset.com

Consolidated Statements of Income (Unaudited)
	Three Months Ended						Six Months Ended
	February 28,			February 29,			February 28,			February 29,
(In thousands, except per share data)		2025			2024			2025			2024
Revenues	$	570,660		$	545,945		$	1,139,327		$	1,088,161
Operating expenses
Cost of services		269,604			255,142			528,383			506,763
Selling, general and administrative		115,564			108,861			234,117			210,416
Total operating expenses		385,168			364,003			762,500			717,179

Operating income		185,492			181,942			376,827			370,982

Other income (expense), net
Interest income		273			2,847			2,974			5,859
Interest expense		(13,916	)		(16,599	)		(28,316	)		(33,337	)
Other income (expense), net		471			455			574			337
Total other income (expense), net		(13,172	)		(13,297	)		(24,768	)		(27,141	)

Income before income taxes		172,320			168,645			352,059			343,841

Provision for income taxes		27,460			27,705			57,177			54,346
Net income	$	144,860		$	140,940		$	294,882		$	289,495

Basic earnings per common share	$	3.81		$	3.70		$	7.76		$	7.61
Diluted earnings per common share	$	3.76		$	3.65		$	7.66		$	7.49

Basic weighted average common shares		38,015			38,103			38,010			38,059
Diluted weighted average common shares		38,510			38,650			38,513			38,646

Certain prior year figures have been conformed to the current year’s presentation.

Consolidated Balance Sheets (Unaudited)
(In thousands)	February 28, 2025		August 31, 2024
ASSETS
Cash and cash equivalents	$	278,548	$	422,979
Investments		8,471		69,619
Accounts receivable, net of reserves of $14,998 at February 28, 2025 and $14,581 at August 31, 2024		277,636		228,054
Prepaid taxes		75,931		55,103
Prepaid expenses and other current assets		67,055		60,093
Total current assets		707,641		835,848

Property, equipment and leasehold improvements, net		79,739		82,513
Goodwill		1,245,315		1,011,129
Intangible assets, net		1,935,488		1,844,141
Deferred taxes		53,546		61,337
Lease right-of-use assets, net		118,129		130,494
Other assets		101,584		89,578
TOTAL ASSETS	$	4,241,442	$	4,055,040

LIABILITIES
Accounts payable and accrued expenses	$	131,103	$	178,250
Current debt		—		124,842
Current lease liabilities		32,560		31,073
Accrued compensation		70,846		93,279
Deferred revenues		177,325		159,761
Current taxes payable		30,483		40,391
Dividends payable		39,511		39,470
Total current liabilities		481,828		667,066

Long-term debt		1,472,162		1,241,131
Deferred taxes		14,772		8,452
Deferred revenues, non-current		446		1,344
Taxes payable		46,313		40,452
Long-term lease liabilities		158,419		177,521
Other liabilities		10,585		6,614
TOTAL LIABILITIES	$	2,184,525	$	2,142,580

STOCKHOLDERS’ EQUITY
TOTAL STOCKHOLDERS’ EQUITY	$	2,056,917	$	1,912,460

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	4,241,442	$	4,055,040

*Consolidated Statements of Cash Flows (Unaudited)*
	Six Months Ended
	February 28,			February 29,
(In thousands)		2025			2024
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	294,882		$	289,495
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization		74,127			58,650
Amortization of lease right-of-use assets		15,177			15,263
Stock-based compensation expense		30,139			30,962
Deferred income taxes		8,763			5,632
Other, net		3,268			7,034
Changes in assets and liabilities, net of effects of acquisitions
Accounts receivable		(46,225	)		(39,468	)
Prepaid expenses and other assets		(3,889	)		(14,690	)
Accounts payable and accrued expenses		(61,915	)		10,377
Accrued compensation		(21,470	)		(40,456	)
Deferred revenues		11,934			22,133
Taxes payable, net of prepaid taxes		(24,810	)		(26,150	)
Lease liabilities, net		(19,654	)		(19,840	)
Net cash provided by operating activities		260,327			298,942

CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property, equipment, leasehold improvements and capitalized internal-use software		(49,610	)		(38,383	)
Acquisition of businesses, net of cash and cash equivalents acquired		(342,461	)		—
Purchases of investments		(4,208	)		(44,936	)
Proceeds from maturity or sale of investments		58,155			—
Net cash provided by (used in) investing activities		(338,124	)		(83,319	)

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from debt		305,000			—
Repayments of debt		(200,000	)		(125,000	)
Dividend payments		(78,817	)		(74,141	)
Proceeds from employee stock plans		60,344			66,544
Repurchases of common stock		(113,142	)		(112,165	)
Deferred acquisition consideration		(4,699	)		—
Other financing activities		(14,228	)		(14,465	)
Net cash provided by (used in) financing activities		(45,542	)		(259,227	)

Effect of exchange rate changes on cash, cash equivalents and restricted cash		(8,048	)		(132	)
Net increase (decrease) in cash, cash equivalents and restricted cash		(131,387	)		(43,736	)
Cash and cash equivalents at beginning of period		422,979			425,444
Cash, cash equivalents and restricted cash at end of period	$	291,592		$	381,708

Reconciliation of total cash, cash equivalents and restricted cash:
Cash and cash equivalents	$	278,548		$	381,708
Restricted cash included in Prepaid expenses and other current assets		6,522			—
Restricted cash included in Other assets		6,522			—
Total cash, cash equivalents and restricted cash	$	291,592		$	381,708

Certain prior year figures have been conformed to the current year’s presentation.

Reconciliation of U.S. GAAP Results to Adjusted Financial Measures

Financial measures in accordance with U.S. GAAP, including revenues, operating income and margin, net income, diluted EPS and cash provided by operating activities, have been adjusted below. FactSet uses these adjusted financial measures both in presenting its results to stockholders and the investment community and in its internal evaluation and management of the business. The Company believes that these adjusted financial measures and the information they provide are useful to investors because they permit investors to view the Company’s performance using the same tools that management uses to gauge progress in achieving its goals. Adjusted measures may also facilitate comparisons to FactSet’s historical performance.

Organic Revenues

Organic revenues exclude the current year impact of revenues from acquisitions and dispositions completed within the past 12 months and the current year impact from changes in foreign currency. The table below provides a reconciliation of revenues to organic revenues:

(Unaudited)	Three Months Ended
	February 28,			February 29,
(In thousands)		2025			2024	Change
Revenues	$	570,660		$	545,945	4.5	%
Acquisition revenues		(3,793	)		—
Currency impact		1,118			—
Organic revenues	$	567,985		$	545,945	4.0	%

Non-GAAP Financial Measures

The table below provides a reconciliation of operating income, operating margin, net income and diluted EPS to adjusted operating income, adjusted operating margin, adjusted net income, EBITDA, adjusted EBITDA and adjusted diluted EPS.

	Three Months Ended
	February 28,			February 29,
(in thousands, except per share data)		2025			2024		% Change
Operating income	$	185,492		$	181,942		2.0	%
Intangible asset amortization		18,137			16,674
Business acquisitions and related costs⁽¹⁾		9,040			—
Restructuring/severance		—			10,710
Adjusted operating income	$	212,669		$	209,326		1.6	%
Operating margin		32.5	%		33.3	%
Adjusted operating margin⁽²⁾		37.3	%		38.3	%
Net income	$	144,860		$	140,940		2.8	%
Intangible asset amortization		13,425			12,579
Business acquisitions and related costs⁽¹⁾		6,691			—
Restructuring/severance		—			8,080
Income tax items		—			1,468
Adjusted net income⁽³⁾	$	164,976		$	163,067		1.2	%
Net income		144,860			140,940		2.8	%
Interest expense		13,916			16,599
Income taxes		27,460			27,705
Depreciation and amortization expense		38,410			31,582
EBITDA	$	224,646		$	216,826		3.6	%
Non-recurring non-cash expenses		—			1,285
Adjusted EBITDA	$	224,646		$	218,111		3.0	%
Diluted EPS	$	3.76		$	3.65		3.0	%
Intangible asset amortization		0.35			0.32
Business acquisitions and related costs⁽¹⁾		0.17			—
Restructuring/severance		—			0.21
Income tax items		—			0.04
Adjusted diluted EPS⁽³⁾	$	4.28		$	4.22		1.4	%
Weighted average common shares (diluted)		38,510			38,650

^{(1)   Primarily related to the acquisition of LiquidityBook.}
^{(2)   Adjusted operating margin is calculated as Adjusted operating income divided by Revenues.}
^{(3)   For purposes of calculating Adjusted net income and Adjusted diluted EPS, all adjustments for the three months ended February 28, 2025 and February 29, 2024 were taxed at an adjusted tax rate of 26.0% and 24.6%, respectively.}

Business Outlook Operating Margin, Net Income and Diluted EPS

(Unaudited)
Figures may not foot due to rounding	Annual Fiscal 2025 Guidance
(In millions, except per share data)	Low end of range			High end of range
Revenues	$	2,305		$	2,325
Operating income	$	761		$	744
Operating margin		33.0	%		32.0	%

Intangible asset amortization		80			81
Other adjustments (net)		12			12
Adjusted operating income	$	853		$	837
Adjusted operating margin (a)		37.0	%		36.0	%

Net income	$	588		$	567
Intangible asset amortization		66			66
Other adjustments (net)		10			10
Discrete tax items		(4	)		(4	)
Adjusted net income	$	660		$	640

Diluted earnings per common share	$	15.40		$	14.80
Intangible asset amortization		1.73			1.73
Other adjustments (net)		0.30			0.30
Discrete tax items		(0.03	)		(0.03	)
Adjusted diluted earnings per common share	$	17.40		$	16.80

^{(a) Adjusted operating margin is calculated as Adjusted operating income divided by Revenues.}

Free Cash Flow

(Unaudited)	Three Months Ended
	February 28,			February 29,
(In thousands)		2025			2024		Change
Net Cash Provided for Operating Activities	$	173,955		$	143,798
Less: purchases of property, equipment, leasehold improvements and capitalized internal-use software		(23,736	)		(21,917	)
Free Cash Flow	$	150,219		$	121,881		23.3	%

Supplementary Schedules of Historical ASV by Client Type

The following table presents the percentages and growth rates of organic ASV by client type, excluding the impact of currency movements, and may be useful to facilitate historical comparisons. Organic ASV excludes acquisitions and dispositions completed within the last 12 months and the effects of foreign currency movements.

The numbers below do not include professional services or issuer fees.

	Q2’25	Q1’25	Q4’24	Q3’24	Q2’24	Q1’24	Q4’23	Q3’23
% of ASV from buy-side clients	82.3%	82.1%	82.0%	82.3%	82.0%	82.0%	81.8%	82.1%
% of ASV from sell-side clients	17.7%	17.9%	18.0%	17.7%	18.0%	18.0%	18.2%	17.9%

ASV Growth rate from buy-side clients	4.1%	4.3%	4.9%	5.3%	5.6%	7.2%	6.9%	7.3%
ASV Growth rate from sell-side clients	2.2%	3.5%	3.8%	3.7%	5.5%	7.6%	9.3%	12.3%

The following table presents the calculation of organic ASV.

(In millions)	As of February 28, 2025
As reported ASV	$	2,306.1
Currency impact ^(a)		1.9
Acquisition ASV ^(b)		(31.8	)
Organic ASV	$	2,276.2
Organic ASV annual growth rate		4.1	%

^{(a) The impact from foreign currency movements.}
^{(b) Acquired ASV from acquisitions completed within the last 12 months.}

MIL-OSI: Wearable Devices Announces Full Year 2024 Financial Results and Provides Corporate Update

Source: GlobeNewswire (MIL-OSI)

YOKNE’AM ILLIT, Israel, March 19, 2025 (GLOBE NEWSWIRE) — Wearable Devices Ltd. (Nasdaq: WLDS, WLDSW) (“Wearable Devices” or the “Company”), a technology growth company specializing in artificial intelligence (“AI”)-powered touchless sensing wearables, today announced its financial results for the year ended December 31, 2024.

Asher Dahan, Chief Executive Officer and Chairman of the Board of Directors of Wearable Devices, commented, “2024 was characterized by strategic capital allocation and the execution of our growth strategy as we delivered our Mudra Band for Apple Watch, and entered into several collaborations with companies and contractors at the forefront of their respective industries. With a strong focus on technological breakthroughs and innovation, we introduced the Mudra Link, a universal gesture control wearable wristband in September 2024. This launch marked a significant milestone in our neural interface technology, enabling seamless, touch-free interaction with a wide range of digital devices. The Mudra Link is open for orders, and we have started to ship the Mudra Link to customers in the first quarter of 2025. We invested significant resources in pursuit of these milestones, mainly due to strategic investments primarily in sales and marketing and research and development as we continue to innovate and showcase our technology, as well as an enhanced focus on business development on the business-to-business (“B2B”) side of our business.”

“Collaborations represent a key part of our business, and we expect our B2B offerings to be a significant driver of revenue for us as we grow. At the beginning of 2024, we launched the B2B Mudra Developer Kit (“MDK”), providing our B2B customers with enhanced capabilities and additional features that improve our B2B offering. The MDK allows original equipment manufacturers (“OEMs”) to design new, customized gestures to create a user interface specifically tailored to their needs. At the beginning of 2024, we announced a collaboration agreement with Qualcomm Incorporated (“Qualcomm”), for the development of products using the Qualcomm Snapdragon Spaces XR Developer Platform. In October 2024, we announced an innovative collaboration with TCL-RayNeo™ (“RayNeo”), a leader in augmented reality (“AR”) technology, aiming at bringing mass-market neural interface wristband for AR glasses to life. We anticipate interest in our B2B product to grow as the market for wearable devices and AI-based technology expands, with more and more customers recognizing the value that our products can add to their operations.

“Our business-to-customer (“B2C”) product, the Mudra Band, is an award-winning aftermarket band for the Apple Watch that enables touchless control of multiple Apple devices. In addition, we’re seeing considerable interest in the Mudra Link, and during the first quarter of 2025 we commenced shipment of our first manufacturing batch to Mudra Link customers. 2024 was characterized by strategic capital allocation and the execution of our growth strategy, with a focus on three key areas: technological breakthroughs and innovation, adoption trends and market outlook, and strategic positioning for future growth.

First, we continued to lead in innovation with groundbreaking technologies that enable natural, touch-free interaction. Second, we are witnessing an increasing adoption trend in neural interface solutions, with growing interest from both consumers and business partners. Finally, we are well-positioned for future growth, supported by our marketing efforts, strong presence at leading trade shows such as CES and MWC, and the growing recognition of Mudra Link as a market-defining product. We continue to receive orders for the product and see significant growth potential as our technology and capabilities evolve.”

Mr. Dahan concluded, “We have a comprehensive strategy with innovative B2B and B2C offerings to maximize our presence in what we believe to be a market that is poised for tremendous growth. We are very encouraged by the progress that we made in 2024 and believe that Wearable Devices is positioned for transformation in coming years, as we continue to invest in our operations, bring innovative products to market, and showcase the breadth and depth of our technology.”

2024 and Recent Business Highlights:

Strategic Collaborations & Expansion

Signed a collaboration agreement with Qualcomm to elevate extended reality (“XR”) experiences using Mudra neural technology.
Collaborated with RayNeo to lead the neural control revolution for AR glasses, positioning Mudra ahead of competitors like Meta.
Signed a reseller agreement to scale licensing efforts in South Korea and China.

Product & Technology Innovations

Launched Mudra Link, the first AI Neural Interface Wristband for Android and beyond, expanding accessibility of neural gesture control.
Released the Mudra Developer Kit (MDK) for B2B customers, enabling OEMs to create tailored user interfaces.
Unveiled AI-powered Large MUAP Models to revolutionize gesture control with personalized neural interactions.
Showcased future AI-powered gesture personalization technology, advancing next-gen human-computer interaction.

Market Recognition & Sales Expansion

Awarded the CES 2025 Innovation Award in XR Technologies and Accessories for Mudra Link.
Chosen as Best Wearable of CES 2024 by SlashGear.com.
Featured in Mashable, VentureBeat, and leading tech magazines.

Strategic Deployments

Successfully completed the first-stage deployment testing for a leading XR glasses OEM, meeting key evaluation criteria.
Demonstrated Mudra technology integration with Qualcomm Snapdragon Spaces at CES 2025 and AWE 2024.
Showed positive results on Lenovo’s XR headset, validating Mudra’s neural technology for next-gen spatial computing.

Intellectual Property & Regulatory Progress

Filed a patent application for touchless pinch-to-zoom technology for AR/VR (virtual reality) applications.
Secured a Chinese patent for its AI Gesture-Controlled Interface.
Expanded international IP portfolio with a neural wrist technology patent filing in South Korea.

Full Year 2024 Financial Highlights:

Revenues: Revenues increased from $82 thousand in 2023 to $522 thousand in 2024, marking a significant step forward in the Company’s transition toward a commercially driven business. This growth was primarily driven by increased sales of the Mudra Band, demonstrating early market adoption and growing demand for neural interface technology. While revenues are still at an early stage, the upward trend reflects positive momentum and a foundation for future expansion.
Research and Development Expenses: Research and development expenses decreased by 11% to $3.0 million in the full year of 2024 compared to $3.3 million in the full year of 2023, reflecting the successful completion of key development phases, particularly Mudra Link, and a transition toward production and sales. The Company continued to focus on creating disruptive, industry leading technology that leverages AI and proprietary algorithms, software and hardware.
Sales and Marketing Expenses: Sales and marketing expenses increased by 4% to $2.1 million in the full year of 2024 compared to $2.0 million in the full year of 2023, related to the Company driving awareness of its technology and products across various channels including participation at multiple leading industry conferences.
General and administrative expenses: General and administrative expenses decreased by 1.3% to $2.8 million in the full year of 2024 compared to $2.9 million in the full year of 2023.
Net Loss: Net loss increased to $(7.9 million), or $(24.2) per diluted share, for the year ended December 31, 2024, as compared to a net loss of $(7.8 million), or $(38.4) per diluted share, for the year ended December 31, 2023.
The per share information reflects the Company’s 1-for-20 reverse share split, which became effective on October 10, 2024, and an additional 1-for-4 reverse share split, which became effective on March 17, 2025.

Cash Position: Cash and deposits as of December 31, 2024 were $4.0 million.
Inventory: Inventory increased to $1.2 million at the end of 2024, as part of the completion of the transition phase from research and development to production and to serve our planned B2C and B2B initiatives in 2025.

About Wearable Devices Ltd.

Wearable Devices Ltd. is a growth company developing AI-based neural input interface technology for the B2C and B2B markets. The Company’s flagship product, the Mudra Band for Apple Watch, integrates innovative AI-based technology and algorithms into a functional, stylish wristband that utilizes proprietary sensors to identify subtle finger and wrist movements allowing the user to “touchlessly” interact with connected devices. The Company also markets a B2B product, which utilizes the same technology and functions as the Mudra Band and is available to businesses on a licensing basis. Wearable Devices Is committed to creating disruptive, industry leading technology that leverages AI and proprietary algorithms, software, and hardware to set the input standard for the Extended Reality, one of the most rapidly expanding landscapes in the tech industry. The Company’s ordinary shares and warrants trade on the Nasdaq market under the symbol “WLDS” and “WLDSW,” respectively.

Forward-Looking Statement Disclaimer

This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are intended to be covered by the “safe harbor” created by those sections. Forward-looking statements, which are based on certain assumptions and describe our future plans, strategies and expectations, can generally be identified by the use of forward-looking terms such as “believe,” “expect,” “may,” “should,” “could,” “seek,” “intend,” “plan,” “goal,” “estimate,” “anticipate” or other comparable terms. For example, we are using forward-looking statements when we discuss the benefits, capabilities, advantages and expected demand, an increasing adoption trend in neural interface solutions, with growing interest from both consumers and business partners, momentum and growth of our products and technology, our expectation for the growth of the B2B market and that our B2B offerings will be a significant driver of revenue for us as we grow, our anticipation that interest in our B2B product will grow as the market for wearable devices and AI-based technology expands and our belief that Wearable Devices is positioned for transformation in coming years. All statements other than statements of historical facts included in this press release regarding our strategies, prospects, financial condition, operations, costs, plans and objectives are forward-looking statements. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: our use of proceeds from the offering; the trading of our ordinary shares or warrants and the development of a liquid trading market; our ability to successfully market our products and services; the acceptance of our products and services by customers; our continued ability to pay operating costs and ability to meet demand for our products and services; the amount and nature of competition from other security and telecom products and services; the effects of changes in the cybersecurity and telecom markets; our ability to successfully develop new products and services; our success establishing and maintaining collaborative, strategic alliance agreements, licensing and supplier arrangements; our ability to comply with applicable regulations; and the other risks and uncertainties described in our annual report on Form 20-F for the year ended December 31, 2023, filed on March 15, 2024 and our other filings with the SEC. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

Investor Contact:

Michal Efraty
IR@wearabledevices.co.il

WEARABLE DEVICES LTD. AND ITS SUBSIDIARY
CONSOLIDATED BALANCE SHEETS

	December 31
	2024			2023
	U.S. dollars in thousands
Assets
CURRENT ASSETS:
Cash and cash equivalents		3,089			810
Short-term bank deposits		862			4,045
Governmental grant receivable		17			108
Other receivables and prepaid expenses		322			757
Inventories		1,226			1,032
TOTAL CURRENT ASSETS		5,516			6,752

NON-CURRENT ASSETS:
Long-term bank deposits		–			54
Right-of-use assets		330			592
Property and equipment, net		130			194
TOTAL NON-CURRENT ASSETS		460			840
TOTAL ASSETS		5,976			7,592

Liabilities and Shareholders’ Equity
CURRENT LIABILITIES:
Accounts payable		157			410
Advance payments		83			312
Convertible promissory note		770			–
Accrued payroll and other employment related accruals		402			579
Accrued expenses		392			190
Lease liabilities		291			297
TOTAL CURRENT LIABILITIES		2,095			1,788
Lease liabilities		21			278
TOTAL LIABILITIES		2,116			2,066

SHAREHOLDERS’ EQUITY:
Ordinary shares no par value : Authorized 50,000,000 as of December 31, 2024 and December 31, 2023; Issued and outstanding 707,463 shares as of December 31, 2024 and 254,843 shares as of December 31, 2023.		67			57
Additional paid-in capital		32,895			26,692
Accumulated losses		(29,102	)		(21,223)
TOTAL SHAREHOLDERS’ EQUITY		3,860			5,526
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		5,976			7,592

WEARABLE DEVICES LTD. AND ITS SUBSIDIARY
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

	Year ended December 31
	2024			2023			2022
	U.S. dollars in thousands (except per share amounts)

Revenues		522			82			45
Cost of revenues		437			(62	)		(10	)
GROSS PROFIT		85			20			35
Research and development, net		(2,964	)		(3,316	)		(2,271	)
Sales and marketing expenses, net		(2,096	)		(2,008	)		(1,370	)
General and administrative expenses		(2,845	)		(2,882	)		(1,948	)
Initial public offering expenses		–			–			(904	)
OPERATING LOSS		(7,820	)		(8,186	)		(6,458	)
Financing income (expenses), net		(52	)		372			(38	)
LOSS BEFORE TAX EXPENSES		(7,872	)		(7,814	)		(6,496	)
Tax expenses		(7	)		–			–
NET LOSS AND TOTAL
COMPREHENSIVE LOSS		(7,879	)		(7,814	)		(6,496	)

Net loss per ordinary shares,
basic and diluted *		(24.2	)		(38.4	)		(42.4	)
Weighted average number of
ordinary shares and pre- funded warrants outstanding basic and diluted *		325,690			202,515			153,465

* The share and per share information in these financial statements reflects the 1-for-20 reverse share split became effective on October 10, 2024 and an additional 1-for-4 reverse share split of our issued and outstanding Ordinary Shares became effective on March 17, 2025.

WEARABLE DEVICES LTD. AND ITS SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS

	Year ended December 31
	2024			2023		2022
	U.S. dollars in thousands
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss		(7,879	)		(7,814)		(6,496)
Adjustments required to reconcile net loss to net cash used in
operating activities
Depreciation		107			68		23
Interest expenses on convertible promissory note		4			–		–
Accrued interest on deposits		(3	)		(45)		–
Share based compensation expenses		182			241		790
Unrealized gain from foreign currency derivative activities		68			(68)		–
Marketing expenses paid in ordinary shares		100			–		–
Provision for inventory write-off		75			–		–

Changes in operating assets and liabilities items:
Decrease in accounts receivable		–			–		8
Decrease (increase) in inventories		(269	)		(1,026)		5
Decrease (increase) in governmental grants receivables		91			(54)		8
Decrease (Increase) in other receivables and prepaid expenses		357			(136)		(496)
Increase (decrease) in advance payments		(228	)		(41)		79
Increase (decrease) in deferred revenues		–			(12)		(12)
Increase (decrease) in accounts payable		(253	)		254		84
Increase (decrease) in accrued payroll and other employment related accruals		(177	)		163		194
Increase in accrued expenses		212			36		99
Net cash used in operating activities		(7,613	)		(8,434)		(5,714)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment		(43	)		(194)		(48)
Decrease (Increase) in deposits, net		3,240			(4,054)		–
Prepayments of leasing		–			–		(18)
Net cash provided by (used in) investing activities		3,197			(4,248)		(66)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of shares issued in the public offering, net of issuance cost		1,578			1,670		–
Proceeds from issuance of units of ordinary shares and warrants in connection with the initial public offering, net of issuance expenses					–		14,319
Proceeds from issuance of SAFEs		–			–		500
Refund to SAFE investors		–			–		(100)
Proceeds from credit line		–			–		800
Repayment of credit line		–			–		(800)
Proceeds from issuance of ordinary shares as a result of exercise of warrants		–			1,449		160
Proceeds from issuance of ordinary shares associated with the SEPA		4,353			–		–
Proceeds from issuance of convertible promissory note		1,920			–		–
Repayment of convertible promissory note		(1,156	)
Net cash provided by financing activities		6,695			3,119		14,879

Net increase (decrease) in cash and cash equivalents		2,279			(9,563)		9,099
Cash and Cash Equivalents at the beginning of year		810			10,373		1,274
Cash and cash equivalents at the end of year		3,089			810		10,373
Supplemental Disclosure:
Interest paid		49			–		40
Interest received		(144	)		(305)		–
Conversion of SAFEs to equity		–			–		400
Right-of-use asset recognized against lease liability		–			644		229

MIL-OSI USA: Luján Joins Bipartisan Push to Deliver Combat-Injured Veterans Full Military Benefits

US Senate News:

Source: United States Senator Ben Ray Luján (D-New Mexico)

Major Richard Star Act would provide combat-injured veterans with full earned disability compensation and retirement pay

Española, N.M. – U.S. Senator Ben Ray Luján (D-N.M.) joined Senate Veterans’ Affairs Committee Ranking Member Richard Blumenthal (D-CT), U.S. Senators Mike Crapo (R-ID), Elizabeth Warren (D-Mass.), and Rick Scott (R-FL) to introduce S. 1032, the Major Richard Star Act—bipartisan legislation to provide combat-injured veteran retirees their full benefits.

Currently, only veterans with disability ratings above 50 percent and more than 20 years of service are eligible to receive the full amount of their Department of Defense (DOD) retirement and Department of Veterans Affairs (VA) disability payments—leaving behind more than 50,000 combat-injured military retirees. The Senators’ Major Richard Star Act will fix this unjust policy for retired combat veterans—providing them their full VA disability and DOD retirement payments.

“The men and women who risked their lives for our country and were injured in combat deserve the full benefits they have earned. Too many veterans have been left behind, and it’s far past time we correct this grave injustice,” said Senator Luján. “That’s why I am proud to stand with my colleagues working to fix the unjust veterans’ disability system.”

“This measure corrects one of the deepest injustices in our present veterans’ disability system,” said Senator Blumenthal. “It is unacceptable that tens of thousands of combat-injured veterans are denied the full military benefits they earned. Our bipartisan bill will right this longstanding injustice and finally provide these military retirees who have already sacrificed so much their full VA disability and Defense Department retirement payments.”

“The Major Richard Star Act corrects a severe injustice for combat-wounded veterans,” said Senator Crapo. “The support for this correction is clear. Though the namesake of our legislation is no longer with us, I continue to press for its passage on behalf of the more than 50,000 veterans, including hundreds in Idaho, who stand to benefit.”

“Our veterans put their lives on the line for this country and it’s time our government gives them the full benefits they’ve earned,” said Senator Warren. “The Major Richard Star Act will ensure the federal government keeps its promise to our veterans by allowing them to collect both disability and retirement benefits they earned, even if combat injuries forced them to retire early.”

“I am a proud veteran and the son of a World War II veteran, and I have immense respect for anyone who puts on the uniform to defend our nation,” said Senator Scott. “Our veterans are American heroes who have made countless sacrifices. The Major Richard Star Act ensures our veterans receive the full benefits they’ve earned through their service and sacrifice protecting our nation regardless of length of service. This legislation makes a critical change to treat our veterans fairly and support our nation’s heroes. I urge my colleagues to support its quick passage.”

This bipartisan legislation is named in honor of Major Richard A. Star, a decorated war veteran who was forced to medically retire due to his combat-related injuries. Major Star sadly lost his battle with cancer on February 13, 2021. The legislation has 43 bipartisan cosponsors.

The House companion version of this bill was introduced by Congressmen Gus Bilirakis (R-FL) and Raul Ruiz (D-CA), with 185 bipartisan cosponsors.

The Senators’ bipartisan effort to provide combat-injured veterans their due benefits is supported by the Air Force Sergeants Association (AFSA), Air & Space Forces Association (AFA), American GI Forum, The American Legion,American Military Society,American Veterans (AMVETS), Armed Forces Retiree Association, Army Aviation Association of America (AAAA), Association of Military Surgeons of the United States (AMSUS), Association of the United States Army (AUSA), Association of the United States Navy (AUSN), Blinded Veterans Association (BVA), Burn Pits 360, Chief Warrant Officers Association of the US Coast Guard (CWOA), Commissioned Officers Association of the U.S. Public Health Service, Inc. (COA), Disabled American Veterans (DAV), Enlisted Association of the National Guard of the United States, Fleet Reserve Association (FRA), Heroes Athletic Association, Gold Star Wives of America (GSW), Iraq and Afghanistan Veterans of America (IAVA), Jewish War Veterans of the United States of America (JWV), K9s for Warriors, Marine Corps League (MCL), Marine Corps Reserve Association (MCRA), Military Chaplains Association of the United States of America (MCA), Military Officers Association of America (MOAA), Military Order of the Purple Heart (MOPH), Mission Roll Call, National Defense Committee, National Military Family Association (NMFA), Naval Enlisted Reserve Association (NERA), Non-Commissioned Officers Association (NCOA), Operation First Response, Paralyzed Veterans of America (PVA),Quality of Life Foundation, Reserve Organization of America (ROA), Stronghold Freedom Foundation, Tragedy Assistance Program for Survivors (TAPS), The Retired Enlisted Association (TREA), The Independence Fund (TIF), United States Army Warrant Officers Association (USAWOA), USCG Chief Petty Officers Association (CPOA), VetsFirst/United Spinal Association, Vietnam Veterans of America (VVA), Wounded Paw Project, Wounded Warrior Project (WWP).

MIL OSI USA News –

MIL-OSI: XBP Europe Holdings, Inc. Reports Fourth Quarter and Full Year 2024 Results

Source: GlobeNewswire (MIL-OSI)

Full Year 2024 Highlights

Revenue of $142.8 million, decrease of 8.0% year-over-year
Gross margin of 26.8%, a 110 bps increase year-over-year
Operating profit of $3.5 million, an increase of $2.4 million year-over-year
Approximately $25M of ACV in active ramp, resulting in an incremental step-up in margin contribution in the second half of 2024
Signed an exclusive, non-binding LOI to acquire Exela Technologies BPA, LLC, a potentially transformational deal that could expand XBP Europe’s revenue to ~$1 billion annually

Fourth Quarter 2024 Highlights

Revenue of $35.6 million, decrease of 7.5% year-over-year and increase of 0.7% sequentially
Gross margin of 28.3%, a 480 bps increase year-over-year and 440 bps decrease sequentially
Operating profit of $1.0 million, an increase of $3.4 million year-over-year and a decrease of $1.5 million sequentially
Net loss of $2.7 million includes $0.5 million of FX losses, an improvement of $2.4 million year-over-year and $0.1 million sequentially

LONDON and SANTA MONICA, Calif., March 19, 2025 (GLOBE NEWSWIRE) — XBP Europe Holdings, Inc. (“XBP Europe” or “the Company”) (NASDAQ: XBP), a pan-European integrator of bills, payments, and related solutions and services seeking to enable the digital transformation of its clients, announced today its financial results for the quarter and full year ended December 31, 2024.

“We ended 2024 with growing momentum, as we continued to ramp our recently awarded contracts, leading to improving profitability and operating metrics. We are excited about our organic growth trajectory in 2025 and we continue to work towards a potential acquisition of Exela Technologies BPA, LLC in 2025 so that we can benefit from global scale,” said Andrej Jonovic, Chief Executive Officer of XBP Europe.

Full Year Highlights

Revenue: Total Revenue for 2024 was $142.8 million, a decline of 8.0% year-over-year, primarily due to completion of projects, lower volumes, and client contract ends, offset by positive impact of newly won business.
- Bills & Payments segment revenue was $101.9 million, a decline of 7.8% year-over-year, primarily attributable to completion of one-time projects, lower volumes, and client contract end, offset by the positive impact of newly won business.
- Technology segment revenue was $40.9 million, a decrease of 8.5% year-over-year, largely due to a lower volume of licenses sold, offset by a drop in technology implementation and professional services revenue.

Operating Profit: Operating Profit was $3.5 million, an increase of $2.4 million compared to 2023. This improvement was driven primarily by higher gross margins coupled with SG&A cost optimizations. Our operating expenses include costs associated with accelerated migration to the cloud.

Net Loss: Net loss from continuing operations was $6.5 million, compared with a net loss from continuing operations of $5.6 million in 2023. The year-over-year increase was primarily driven by higher income tax expense and interest expense, offset by higher operating profit and lower related party interest expense.

Adjusted EBITDA⁽¹⁾: Adjusted EBITDA from Continuing Operations was $13.4 million, a decrease of $2.4 million or 15.1% compared to 2023. Adjusted EBITDA margin was 9.4%, a decrease of 80 basis points from 10.2% in 2023.

Capital Expenditures: Capital expenditures were 1.2% of revenue compared to 1.7% of revenue in 2023, with the decrease primarily due to lower purchases of PP&E.

Adequate Liquidity: The Company’s cash and cash equivalents totaled $12.1 million as of December 31, 2024.

Other Highlights:

Pending Acquisition: As announced on March 4, 2025, XBP Europe has entered into an exclusive, non-binding letter of intent with Exela Technologies, Inc. to acquire Exela Technologies BPA, LLC (“BPA”), a leading provider of business process automation solutions. The closing of the acquisition will be subject to BPA completing a corporate reorganization which is expected to create a sustainable capital structure with a substantially deleveraged balance sheet. If completed, the acquisition will expand XBP Europe’s revenue to more than $1 billion from $145 million on a pro forma basis for the twelve months ending September 30, 2024. The parties have agreed to act in good faith to negotiate definitive agreements, complete due diligence, undertake necessary regulatory approvals, and seek any necessary approvals, including from XBP Europe’s shareholders. Accordingly, there can be no assurance that a definitive agreement will be entered into or that the proposed transaction will be consummated. Readers are cautioned that those portions of the LOI that describe the proposed transaction are non-binding. XBP Europe only intends to announce additional details regarding the proposed transaction if and when a definitive agreement is executed.

Segment Revenue and Profitability:

	Three months ended December 31, 2024
	Bills & Payments		Technology		Total
Revenue, net	$	25,851	$	9,794	$	35,645
Cost of revenue	20,460		5,108		25,568
Segment Gross Profit	5,391		4,686		10,077

	Three months ended December 31, 2023
	Bills & Payments		Technology		Total
Revenue, net	$	27,368	$	11,165	$	38,533
Cost of revenue	24,203		5,270		29,472
Segment Gross Profit	3,165		5,895		9,061

	Twelve months ended December 31, 2024
	Bills & Payments		Technology		Total
Revenue, net	$	101,850	$	40,922	$	142,772
Cost of revenue	85,454		19,059		104,513
Segment Gross Profit	16,396		21,863		38,259

	Twelve months ended December 31, 2023
	Bills & Payments		Technology		Total
Revenue, net	$	110,458	$	44,719	$	155,177
Cost of revenue	95,572		19,738		115,310
Segment Gross Profit	14,886		24,981		39,867

Below is the note referenced above:

(1) Adjusted EBITDA is a non-GAAP measure. A reconciliation of Adjusted EBITDA is attached to this release.

Supplemental Investor Presentation
An investor presentation relating to our fourth quarter and full year 2024 performance is available at investors.xbpeurope.com. This information has also been furnished to the SEC in a current report on Form 8-K.

About Non-GAAP Financial Measures
This press release includes constant currency, EBITDA and Adjusted EBITDA, each of which is a financial measure that is not prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). XBP Europe believes that the presentation of these non-GAAP financial measures will provide useful information to investors in assessing our financial performance, results of operations and liquidity and allows investors to better understand the trends in our business and to better understand and compare our results. XBP Europe’s board of directors and management use constant currency, EBITDA and Adjusted EBITDA to assess XBP Europe’s financial performance, because it allows them to compare XBP Europe’s operating performance on a consistent basis across periods by removing the effects of XBP Europe’s capital structure (such as varying levels of debt and interest expense, as well as transaction costs resulting from the combination with CF Acquisition Corp. VIII. on November 29, 2023). Adjusted EBITDA also seeks to remove the effects of restructuring and related expenses and other similar non-routine items, some of which are outside the control of our management team. Restructuring expenses are primarily related to the implementation of strategic actions and initiatives related to right sizing of the business. All of these costs are variable and dependent upon the nature of the actions being implemented and can vary significantly driven by business needs. Accordingly, due to that significant variability, we exclude these charges since we do not believe they truly reflect our past, current or future operating performance. The constant currency presentation excludes the impact of fluctuations in foreign currency exchange rates. We calculate constant currency revenue on a constant currency basis by converting our current-period local currency revenue using the exchange rates from the corresponding prior-period and compare these adjusted amounts to our corresponding prior period reported results. XBP Europe does not consider these non-GAAP measures in isolation or as an alternative to liquidity or financial measures determined in accordance with GAAP. A limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in XBP Europe’s financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by management about which expenses and income are excluded or included in determining these non-GAAP financial measures and therefore the basis of presentation for these measures may not be comparable to similarly-titled measures used by other companies. These non-GAAP financial measures are not required to be uniformly applied, are not audited and should not be considered in isolation or as substitutes for results prepared in accordance with GAAP. Net loss is the GAAP measure most directly comparable to the non-GAAP measures presented here. For reconciliation of the comparable GAAP measures to these non-GAAP financial measures, see the schedules attached to this release.

Forward-Looking Statements
This press release contains certain “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Exchange Act, including certain financial forecasts and projections. All statements other than statements of historical fact contained in this press release, including statements as to future results of operations and financial position, revenue and other metrics planned products and services, business strategy and plans, objectives of management for future operations of XBP Europe, market size and growth opportunities, competitive position and technological and market trends, are forward-looking statements. Some of these forward-looking statements can be identified by the use of forward-looking words, including “may,” “should,” “expect,” “intend,” “will,” “estimate,” “anticipate,” “believe,” “predict,” “plan,” “targets,” “projects,” “could,” “would,” “continue,” “forecast” or the negatives of these terms or variations of them or similar expressions. All forward-looking statements are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. All forward-looking statements are based upon estimates, forecasts and assumptions that, while considered reasonable by XBP Europe and its management, as the case may be, are inherently uncertain and many factors may cause the actual results to differ materially from current expectations which include, but are not limited to: (1) the outcome of any legal proceedings that may be instituted against XBP Europe or others and any definitive agreements with respect thereto; (2) the inability to meet the continued listing standards of Nasdaq or another securities exchange; (3) the risk that the business combination disrupts current plans and operations of XBP Europe and its subsidiaries; (4) the inability to recognize the anticipated benefits of the business combination, which may be affected by, among other things, competition, the ability of XBP Europe and its subsidiaries to grow and manage growth profitably, maintain relationships with customers and suppliers and retain its management and key employees; (5) costs related to the business combination; (6) changes in applicable laws or regulations; (7) the possibility that XBP Europe or any of its subsidiaries may be adversely affected by other economic, business and/or competitive factors; (8) risks related to XBP Europe’s potential inability to achieve or maintain profitability and generate cash; (9) the impact of the COVID-19 pandemic, including any mutations or variants thereof, and its effect on business and financial conditions; (10) volatility in the markets caused by geopolitical and economic factors; (11) the ability of XBP Europe to retain existing clients; (12) the potential inability of XBP Europe to manage growth effectively; (13) the ability to recruit, train and retain qualified personnel, and (14) other risks and uncertainties set forth in the sections entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in the Annual Reports on Form 10-K filed on April 1, 2024 and, our subsequent quarterly reports on Form 10-Q and our current reports on Form 8-K as filed with the Securities and Exchange Commission (the “SEC”). These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Nothing in this press release should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. Readers should not place undue reliance on forward-looking statements, which speak only as of the date they are made. XBP Europe gives no assurance that either XBP Europe or any of its subsidiaries will achieve its expected results. XBP Europe undertakes no duty to update these forward-looking statements, except as otherwise required by law.

About XBP Europe
XBP Europe is a pan-European integrator of bills, payments and related solutions and services seeking to enable digital transformation of its more than 2,000 clients. The Company’s name – ‘XBP’ – stands for ‘exchange for bills and payments’ and reflects the Company’s strategy to connect buyers and suppliers, across industries, including banking, healthcare, insurance, utilities and the public sector, to optimize clients’ bills and payments and related digitization processes. The Company provides business process management solutions with proprietary software suites and deep domain expertise, serving as a technology and services partner for its clients. Its cloud-based structure enables it to deploy its solutions across the European market, along with the Middle East and Africa. The physical footprint of XBP Europe spans 15 countries and 32 locations and a team of approximately 1,500 individuals. XBP Europe believes its business ultimately advances digital transformation, improves market wide liquidity by expediting payments, and encourages sustainable business practices. For more information, please visit: www.xbpeurope.com.

For more XBP Europe news, commentary, and industry perspectives, visit: https://www.xbpeurope.com/
And please follow us on social:
X: https://X.com/XBPEurope
LinkedIn: https://www.linkedin.com/company/xbp-europe/

The information posted on XBP Europe’s website and/or via its social media accounts may be deemed material to investors. Accordingly, investors, media and others interested in XBP Europe should monitor XBP Europe’s website and its social media accounts in addition to XBP Europe’s press releases, SEC filings and public conference calls and webcasts.

Investor and/or Media Contacts:
investors@xbpeurope.com


XBP Europe Holdings, Inc. Consolidated Balance Sheets For the years ended December 31, 2024 and 2023 (in thousands of United States dollars except share and per share amounts)

	December 31,
	2024		2023
ASSETS
Current assets
Cash and cash equivalents	$	12,099	$	6,537
Accounts receivable, net of allowance for credit losses of $1,198 and $1,183, respectively		19,810		30,238
Inventories, net		3,823		4,045
Prepaid expenses and other current assets		4,228		6,550
Current assets held for sale		1,378		2,497
Total current assets		41,338		49,867
Property, plant and equipment, net of accumulated depreciation of $40,325 and $39,876, respectively		11,272		12,811
Operating lease right-of-use assets, net		4,805		5,206
Goodwill		21,666		22,823
Intangible assets, net		1,121		1,498
Deferred income tax assets		7,026		6,811
Other noncurrent assets		817		705
Noncurrent assets held for sale		—		3,018
Total assets	$	88,045	$	102,739

LIABILITIES AND STOCKHOLDERS’ DEFICIT
LIABILITIES
Current liabilities
Accounts payable	$	12,553	$	13,281
Related party payables		5,443		13,012
Accrued liabilities		17,993		23,850
Accrued compensation and benefits		16,482		16,267
Customer deposits		277		323
Deferred revenue		6,870		6,004
Current portion of finance lease liabilities		12		91
Current portion of operating lease liabilities		1,734		1,562
Current portion of long-term debts		4,958		3,863
Current liabilities held for sale		2,443		3,818
Total current liabilities		68,765		82,071
Related party notes payable		1,451		1,542
Long-term debt, net of current maturities		23,966		12,763
Finance lease liabilities, net of current portion		—		23
Pension liabilities		10,339		12,208
Operating lease liabilities, net of current portion		3,271		3,785
Other long-term liabilities		1,599		1,635
Noncurrent liabilities held for sale		—		1,280
Total liabilities	$	109,391	$	115,307


STOCKHOLDERS’ DEFICIT
Preferred stock, par value of $0.0001 per share; 10,000,000 shares authorized; none issued and outstanding as of December 31, 2024 and December 31, 2023, respectively		—		—
Common Stock, par value of $0.0001 per share; 200,000,000 shares authorized; 30,166,102 shares issued and outstanding as of December 31, 2024 and December 31, 2023, respectively		30		30
Additional paid in capital		1,611		—
Accumulated deficit		(23,705)		(11,339)
Accumulated other comprehensive loss:
Foreign currency translation adjustment		474		(1,416)
Unrealized pension actuarial gains, net of tax		244		157
Total accumulated other comprehensive loss		718		(1,259)
Total stockholders’ deficit		(21,346)		(12,568)
Total liabilities and stockholders’ deficit	$	88,045	$	102,739

XBP Europe Holdings, Inc. Consolidated Statements of Operations For the years ended December 31, 2024 and 2023 (in thousands of United States dollars except share and per share amounts)

	Year ended December 31,
	2024		2023
Revenue, net	$	142,408	$	154,943
Related party revenue, net		364		234
Cost of revenue (exclusive of depreciation and amortization)		104,467		115,234
Related party cost of revenue		47		76
Selling, general and administrative expenses (exclusive of depreciation and amortization)		26,525		31,173
Related party expense		5,101		4,633
Depreciation and amortization		3,160		2,944
Operating profit		3,472		1,117
Other expense (income), net
Interest expense, net		6,232		5,035
Related party interest expense, net		90		1,971
Foreign exchange losses, net		2,520		599
Changes in fair value of warrant liability		(43)		(597)
Pension income, net		(1,705)		(929)
Net loss before income taxes		(3,622)		(4,962)
Income tax expense		2,911		606
Net loss from continuing operations		(6,533)		(5,568)
Net loss from discontinued operations, net of income taxes		(5,833)		(5,479)
Net loss	$	(12,366)	$	(11,047)
Loss per share:
Basic and diluted – continuing operations	$	(0.22)	$	(0.25)
Basic and diluted – discontinued operations		(0.19)		(0.24)
Basic and diluted	$	(0.41)	$	(0.49)

XBP Europe Holdings, Inc. Consolidated Statements of Cash Flows For the years ended December 31, 2024 and 2023 (in thousands of United States dollars)

	Years ended December 31,
	2024		2023
Cash flows from operating activities
Net loss	$	(12,366)	$	(11,047)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		2,965		3,467
Amortization of intangible assets		750		384
Debt issuance cost amortization		216		—
Impairment of goodwill		87		—
Credit loss expense		16		343
Changes in fair value of warrant liability		(43)		(597)
Stock-based compensation expense		1,611		—
Unrealized foreign currency losses (gains)		2,428		(616)
Change in deferred income taxes		(247)		(422)

Change in operating assets and liabilities
Accounts receivable		9,568		5,990
Inventories		240		(58)
Prepaid expense and other assets		2,297		2,123
Accounts payable		(365)		(2,417)
Related party payables		(8,446)		(843)
Accrued expenses and other liabilities		(4,848)		2,629
Deferred revenue		1,099		67
Customer deposits		(189)		(538)
Net cash used in operating activities		(5,227)		(1,535)

Cash flows from investing activities
Purchase of property, plant and equipment		(1,263)		(2,330)
Cash paid for costs of fulfilling a contract		—		(339)
Additions to internally developed software		(447)		—
Net cash used in investing activities		(1,710)		(2,669)

Cash flows from financing activities
Borrowings under secured borrowing facility		—		87,635
Principal repayment on borrowings under secured borrowing facility		(79)		(91,662)
Borrowings under 2024 Term Loan A Facility		3,834		—
Borrowings under 2024 Term Loan B Facility		11,360		—
Borrowings under 2024 Revolving Credit Facility		15,352		—
Cash paid for debt issuance costs		(1,527)		—
Principal payments on 2024 Term Loan A Facility		(383)		—
Principal payments on 2024 Term Loan B Facility		(1,136)		—
Principal payments on long-term obligations		(15,270)		(920)
Proceeds from Secured Credit Facility		930		223
Principal payments on finance leases		(635)		(786)
Proceeds from Business Combination, net of transaction expenses		—		5,205
Net cash provided by (used in) financing activities		12,446		(305)
Effect of exchange rates on cash and cash equivalents		(308)		3,941
Net increase (decrease) in cash and cash equivalents		5,201		(568)

Cash and equivalents, beginning of period, including cash from discontinued operations		6,905		7,473
Cash and equivalents, end of period, including cash from discontinued operations	$	12,106	$	6,905

Supplemental cash flow data:
Income tax payments, net of refunds received		567		1,059
Interest paid		3,429		1,798

XBP Europe Holdings, Inc. Schedule 1: Reconciliation of Adjusted EBITDA and constant currency revenues

Reconciliation of Non-GAAP Financial Measures to GAAP Measures

Non-GAAP constant currency revenue reconciliation
	Twelve Months ended December 31,
($ in thousands)	2024	2023
Revenues, as reported (GAAP)	142,772	155,177
Foreign currency exchange impact ⁽¹⁾	(1,055)	–
Revenues, at constant currency (Non-GAAP)	141,717	155,177

Reconciliation of Adjusted EBITDA from Continuing Operations
	Year Ended December 31,
(dollars in thousands)	2024		2023
Net loss from continuing operations	$	(6,533)	$	(5,568)
Income tax expense		2,911		606
Interest expense including related party interest expense, net		6,322		7,006
Depreciation and amortization		3,160		2,944
EBITDA from continuing operations		5,860		4,988
Restructuring and related expenses ⁽²⁾		1,879		5,053
Employee litigation matter ⁽³⁾		1,283		1,431
Related party management fee and royalties ⁽⁴⁾		—		1,330
Foreign exchange losses, net		2,520		599
Non-cash equity compensation ⁽⁵⁾		1,611		—
Changes in fair value of warrant liability		(43)		(597)
Transaction Fees ⁽⁶⁾		280		2,970
Adjusted EBITDA from continuing operations	$	13,390	$	15,774

(1)   Constant currency excludes the impact of foreign currency fluctuations and is computed by applying the average exchange rates for the year ended December 31, 2023, to the revenues during the corresponding period in 2024.
(2)   Adjustment represents costs associated with restructuring, including employee severance and vendor and lease termination costs.
(3)   Represents litigation settlement and associated expenses incurred in connection with the Company subsidiary litigation.
(4)   Primarily represents management fee incurred in exchange for services, which included provision of legal, human resources, corporate finance, and marketing support. The management services agreement was terminated in connection with the Business Combination and was replaced by the related party service fee pursuant to the Services Agreement which reduced the fee and modified the services provided.
(5)   Represents the non-cash charges to restricted stock units and options.
(6)   Represents transaction costs incurred as part of the Business Combination.


Reconciliation of Adjusted EBITDA from Discontinued Operations
	Year Ended December 31,
(dollars in thousands)	2024		2023
Net loss from discontinued operations, net of income taxes	$	(5,833)	$	(5,479)
Income tax expense		—		—
Interest expense, net		145		189
Depreciation and amortization		555		907
EBITDA from discontinued operations		(5,133)		(4,383)
Restructuring and related expenses ⁽⁷⁾		38		187
Related party service fees and royalties		—		25
Impairment of goodwill		87		—
Foreign exchange losses (gains), net		211		(5)
Adjusted EBITDA from discontinued operations	$	(4,797)	$	(4,176)

(7) Adjustment represents costs associated with restructuring related to employee severance.

Source: XBP Europe Holdings, Inc.

MIL-OSI: Kingsoft Cloud Announces Unaudited Fourth Quarter and Fiscal Year 2024 Financial Results; First Time Operating Margin Profitable with Accelerated Growing Revenue of AI Cloud

Source: GlobeNewswire (MIL-OSI)

BEIJING, March 19, 2025 (GLOBE NEWSWIRE) — Kingsoft Cloud Holdings Limited (“Kingsoft Cloud” or the “Company”) (NASDAQ: KC and HKEX: 3896), a leading cloud service provider in China, today announced its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2024.

Fourth Quarter Financial Highlights

Total Revenues reached RMB2,232.1 million (US$305.8 million)¹, increased by 29.6% year-over-year from RMB1,722.5 million in the same quarter of 2023. Our business has experienced accelerated and high-quality growth and our revenue structure is well-balanced.
Gross profit was RMB426.0 million (US$58.4 million), representing a significant increase of 68.3% from RMB253.1 million in the same quarter of 2023. Our profitability has been fundamentally improved.
Non–GAAP EBITDA² was RMB359.7 million (US$49.3 million), compared with RMB-27.7 million in the same quarter of 2023. Non–GAAP EBITDA margin was 16. 1%, compared with -1.6% in the same quarter of 2023.
Operating loss was RMB43.5 million (US$6.0 million), compared with operating loss of RMB342.7 million in the same quarter of 2023.
Non–GAAP Operating profit (loss) turned profit for the first time, achieving RMB24.4 million (US$3.3 million), compared with RMB-187.6 million in the same quarter of 2023. Non–GAAP Operating profit (loss) margin was 1. 1%, compare with -10.9% in the same quarter of 2023.

Mr. Tao Zou, Chief Executive Officer of Kingsoft Cloud, commented, “We are very pleased to close Fiscal Year 2024 with historically strong financial performance. This quarter, we recorded positive non–GAAP operating profit (loss)for the first time, demonstrating our unwavering execution of the ‘High- quality, Sustainable Development Strategy’. Driven by the growing popularity of AI applications, we firmly believe that AI will continue to penetrate into various verticals, improving the efficiency of daily life. This quarter the gross billing of AI business increased by triple-digit year-over-year to RMB474 million. Both our public cloud and enterprise cloud businesses are harnessing the vast potential of AI cloud computing. Meanwhile, we have seen strong growth in demand from our ecosystem. Revenue from Xiaomi and Kingsoft Group increased by 76% year-over-year. We are well on track to build cutting- edge cloud infrastructure and technology to support our ecosystem and expand into the broader AI industry.”

Mr. Henry He, Chief Financial Officer of Kingsoft Cloud, added, “We are very pleased to highlight several significant achievements. First, we achieved profitability in non-GAAP operating profit for the first time since our inception in 2012, demonstrating our strong execution of our high-quality and sustainable development strategy in the past two years. Second, our revenue has been growing for three consecutive quarters year-over-year, and this quarter we achieved a high-speed growth rate of 30% in total revenue, reaching RMB2,232.1 million. Third, gross billing of our Al cloud business increased by around 500% year-over-year to RMB474 million, accounting for as high as 34% of our public cloud revenue. This marks a three-digit year-on-year growth or six consecutive quarters. Fourth, last December, our shareholders approved revenue from connected-party of Xiaomi and Kingsoft Group for next three years of RMB11.3 billion, around 10 times over the revenue of 2023, providing solid support for Company’s revenue and profit growth. We believe we are well on track to meet the ecosystem’s fast-growing demands and build a solid cloud infrastructure to support its AI development. Notably, in this quarter, we are thrilled to report that revenue from Xiaomi and Kingsoft Group increased by 76% year-over-year, validating the effectiveness of our ecosystem strategy.”

Fourth Quarter 2024 Financial Results

Total Revenues reached RMB2,232.1 million (US$305.8 million), increased by 29.6% year-over-year from RMB1,722.5 million in the same quarter of 2023 and increased by 18.4% quarter-over-quarter from RMB1,885.6 million in the third quarter of 2024. The year-over-year increase was mainly due to the expanded revenue from Xiaomi and Kingsoft Ecosystem and AI related customers, incremental demands and more projects delivered from enterprise cloud approaching year-end.

Revenues from public cloud services were RMB1,409.8 million (US$193.1 million), increased by 34.0% from RMB1,052.0 million in the same quarter of 2023 and increased by 19.9% from RMB1, 175.5 million last quarter. The year-over-year increase was mainly due to the growth of AI demands.

______________________
¹ This announcement contains translations of certain Renminbi (RMB) amounts into U.S. dollars (US$) at a specified rate solely for the convenience of the reader. Unless otherwise noted, the translation of RMB into US$ has been made at RMB7.2993 to US$1.00, the noon buying rate in effect on December 31, 2024 as certified for customs purposes by the Federal Reserve Bank of New York.

² Non-GAAP EBITDA is defined as non-GAAP net loss excluding interest income, interest expense, income tax expense (benefit) and depreciation and amortization, and we define Non-GAAP EBITDA margin as Non-GAAP EBITDA as a percentage of revenues. See “Use of Non-GAAP Financial Measures” set forth at the end of this press release.

Revenues from enterprise cloud services were RMB822.3 million (US$112.7 million), representing an increase of 22.7% from RMB670.3 million in the same quarter of 2023 and an increase of 15.8% from RMB710.0 million last quarter. We keep focusing in selected verticals such as public services cloud, state-owned assets cloud, healthcare, financial services and private enterprise services, enhance our solutions with AI capabilities and take profitability and sustainability of the enterprise cloud projects as our priorities.
Other revenues were nil this quarter.

Cost of revenues was RMB1,806.2 million (US$247.4 million), representing an increase of 22.9% from RMB1,469.3 million in the same quarter of 2023, which was in-line with our revenue expansion. IDC costs decreased by 2.6% year-over-year from RMB740.4 million to RMB721.5 million (US$98.8 million) this quarter. The decrease was in line with the scale down of our CDN services and our strict control over procurement costs. Depreciation and amortization costs increased from RMB146.9 million in the same quarter of 2023 to RMB343.1 million (US$47.0 million) this quarter. The increase was mainly due to the depreciation of newly acquired servers which were related to AI business. Solution development and services costs increased by 10.8% year-over-year from RMB502.9 million in the same quarter of 2023 to RMB557.0 million (US$76.3 million) this quarter. The increase was mainly due to the solution personnel expansion of Camelot. Fulfillment costs and other costs were RMB102.4 million (US$14.0 million) and RMB82.2 million (US$11.3 million) this quarter.

Gross profit was RMB426.0 million (US$58.4 million), representing a significant increase of 68.3% from RMB253.1 million in the same quarter of 2023, demonstrating our improvements in revenue quality and structure, as well as strict cost control. Gross margin was 19. 1%, compared with 14.7% in the same period in 2023. Non–GAAP gross profit³ was RMB427.7 million (US$58.6 million), compared with RMB262.5 million in the same period in 2023. Non–GAAP gross margin³ was 19.2%, compared with 15.2% in the same period in 2023. The significant improvement of our gross profit and margin was mainly due to our strategic adjustment of revenue mix, expansion of AI revenues, optimized enterprise cloud project selection and efficient cost control measures.

Total operating expenses were RMB469.5 million (US$64.3 million), decreased by 21.2% from RMB595.9 million in the same quarter last year and decreased by 67.6% from RBM1,447.1 million last quarter. Among which:

Selling and marketing expenses were RMB115.8 million (US$15.9 million), decreased by 8.4% from RMB126.5 million in the same period in 2023 and decreased by 4.4% from RMB121.1 million last quarter, the decrease was due to the decrease of share-based compensation.

General and administrative expenses were RMB179.5 million (US$24.6 million), decreased by 39.0% from RMB294.2 million in the same period in 2023 and slightly increased by 5.4% from RMB170.4 million last quarter. The year-over-year decrease was mainly due to the decrease of credit loss expense.

Research and development expenses were RMB174.2 million (US$23.9 million), decreased by 0.6% from RMB175.2 million in the same period in 2023 and 26.2% from RMB235.9 million last quarter. The decrease was mainly due to the decrease of share-based compensation.

Operating loss was RMB43.5 million (US$6.0 million), compared with operating loss of RMB342.7 million in the same quarter of 2023 and RMB1,143.8 million last quarter. The improvement was mainly due to the increase of gross profit and our strict expenses control. Non–GAAP operating profit (loss)⁴ was RMB24.4 million (US$3.3 million), compared with operating loss of RMB187.6 million in the same quarter last year and RMB140.2 million last quarter. Our non-GAAP operating profit (loss) turned breakeven for the first time and verified our high quality and sustainable development strategy.

Net loss was RMB200.6 million (US$27.5 million), compared with net loss of RMB286.8 million in the same quarter of 2023 and RMB1,061.1 million last quarter. Non–GAAP net loss⁵ was RMB70.3 million (US$9.6 million), narrowed down compared with RMB250.4 million in the same quarter of 2023 and RMB236.7 million last quarter. The improvement was mainly due to the revenue quality increase, revenue mix adjustment, strict costs control and expenses control.
______________________
³ Non-GAAP gross profit is defined as gross profit excluding share-based compensation allocated in the cost of revenues and we define Non-GAAP gross margin as Non-GAAP gross profit as a percentage of revenues. See “Use of Non-GAAP Financial Measures” set forth at the end of this press release.

⁴ Non-GAAP operating loss is defined as operating loss excluding share-based compensation, impairment of long-lived assets and amortization of intangible assets and we define Non-GAAP operating loss margin as Non-GAAP operating loss as a percentage of revenues. See “Use of Non-GAAP Financial Measures” set forth at the end of this press release.

⁵ Non-GAAP net loss is defined as net loss excluding share-based compensation, impairment of long-lived assets and foreign exchange (gain) loss, and we define Non-GAAP net loss margin as Non-GAAP net loss as a percentage of revenues. See “Use of Non-GAAP Financial Measures” set forth at the end of this press release.

Non–GAAP EBITDA⁶ was RMB359.7 million (US$49.3 million), compared with RMB-27.7 million in the same quarter of 2023 and RMB185.4 million last quarter. Non–GAAP EBITDA margin was 16. 1%, compared with -1.6% in the same quarter of 2023 and 9.8% last quarter. The increase was mainly due to the expansion in gross profit and our strict control over costs and expenses.

Basic and diluted net loss per share was RMB0.05 (US$0.01), compared with RMB0.08 in the same quarter of 2023 and RMB0.29 last quarter.

Cash and cash equivalents were RMB2,648.8 million (US$362.9 million) as of December 31, 2024, compared with RMB1,617.9 million as of September 30, 2024. The increase was mainly due to the increased cash receipts from operating activities and the increase in bank loan drawdowns.

Fiscal Year 2024 Financial Results

Total Revenues reached RMB7,785.2 million (US$1,066.6 million), representing an increase of 10.5% from RMB7,047.5 million in 2023. The increase was due to the strong demands from AI business and enterprise cloud projects increase, while partially offset by our proactive scale-down of CDN services within public cloud services.

Revenues from public cloud services were RMB5,007.3 million (US$686.0 million), representing an increase of 14.3% from RMB4,381.7 million in 2023.
Revenues from enterprise cloud services were RMB2,777.8 million (US$380.6 million), representing an increase of 4.3% from RMB2,664.0 million in 2023.
Other revenues were RMB0.1 million (US$0.02 million).

^{______________________
6} Non-GAAP EBITDA is defined as Non-GAAP net loss excluding interest income, interest expense, income tax expense (benefit) and depreciation and amortization, and we define Non-GAAP EBITDA margin as Non-GAAP EBITDA as a percentage of revenues. See “Use of Non-GAAP Financial Measures” set forth at the end of this press release.

Cost of revenues was RMB6,444.3 million (US$882.9 million), representing a slight increase of 4.0% from RMB6, 197.3 million in 2023. Among which:

IDC costs decreased by 9.9% to RMB2,892.1 million (US$396.2 million) from RMB3,211.2 million in 2023. The decrease was in line with our cost control measures adjustment of CDN services. Depreciation and amortization costs were RMB1,090.1 million (US$149.3 million), compared with RMB774.0 million in 2023, mainly due to the depreciation of new acquired servers related to AI business. Fulfillment costs were RMB235.7 million (US$32.3 million), representing an increase of 2.7% from RMB229.5 million in 2023. The increase was in line with enterprise cloud projects increase. Solution development and services costs were RMB1,993.1 million (US$273.1 million) in 2024, compared with RMB1,804.8 million in 2023. The increase was mainly due to the revenue expansion of Camelot business.

Gross profit increased by 57.7% to RMB1,340.9 million (US$183.7 million) in 2024, from RMB850.2 million in 2023. Gross margin increased to 17.2%, from 12. 1% in 2023. Non–GAAP gross profit increased to RMB1,357.8 million (US$186.0 million) in 2024, from RMB859.9 million in 2023. Non–GAAP gross margin increased to 17.4% in 2024 from 12.2% in 2023. Such increases were primarily because of the optimization of revenue mix and our effective cost controls.

Selling and marketing expenses were RMB479.4 million (US$65.7 million), compared with RMB460.2 million in 2023. The increase was mainly due to the increase of share-based compensation.

General and administrative expenses were RMB834.9 million (US$114.4 million), compared with RMB1,060.0 million in 2023. The decrease was mainly due to the decrease of credit loss expense.

Research and development expenses were RMB846.0 million (US$115.9 million), compared with RMB784.8 million in 2023. The increase was mainly due to the rise in personnel-related expenses.

Impairment of long–lived assets was RMB919.7 million (US$126.0 million), mainly attributable to impairment of long-lived assets dedicated to assets of low-margin services.

Operating loss was RMB1,739.0 million (US$238.2 million), compared with RMB2, 108.6 million in 2023. Non–GAAP operating loss was RMB431.3 million (US$59.1 million), significantly narrowed compared with RMB1,092.8 million in 2023. Non–GAAP operating loss margin was 5.5%, significantly improved from 15.5% in 2023.

Net loss was RMB1,979.0 million (US$271.1 million), significantly narrowed from net loss of RMB2, 183.6 million in 2023.

Non–GAAP net loss was RMB825.3 million (US$113.1 million), compared with Non-GAAP net loss of RMB1,291.1 million in 2023.

Non–GAAP EBITDA was RMB638.9 million (US$87.5 million), compared with RMB-265.1 million in 2023. Non–GAAP EBITDA margin was 8.2%, compared with -3.8% in 2023.

Basic and diluted net loss per share was RMB0.54 (US$0.07), compared with RMB0.61 in 2023.

Outstanding ordinary shares were 3,687,690,772 as of December 31, 2024, equivalent to about 245,846,051 ADSs.

Conference Call Information

Kingsoft Cloud’s management will host an earnings conference call on Wednesday, March 19, 2025 at 8:15 am, U.S. Eastern Time (8:15 pm, Beijing/Hong Kong Time on the same day).

Participants can register for the conference call by navigating to https://register-conf.media-server.com/register/BIc315136cafe94825b98dca6b37795790. Once preregistration has been completed, participants will receive dial-in numbers, direct event passcode, and a unique access PIN.

To join the conference, simply dial the number in the calendar invite you receive after preregistering, enter the passcode followed by your PIN, and you will join the conference instantly.

Additionally, a live and archived webcast of the conference call will also be available on the Company’s investor relations website at http://ir.ksyun.com.

Use of Non–GAAP Financial Measures

The unaudited condensed consolidated financial information is prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). In evaluating our business, we consider and use certain non-GAAP measures, Non-GAAP gross profit, Non-GAAP gross margin, Non-GAAP operating loss, Non-GAAP operating loss margin, Non-GAAP EBITDA, Non-GAAP EBITDA margin, Non-GAAP net loss and Non-GAAP net loss margin, as supplemental measures to review and assess our operating performance. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. We define Non- GAAP gross profit as gross profit excluding share-based compensation allocated in the cost of revenues, and we define Non-GAAP gross margin as Non-
GAAP gross profit as a percentage of revenues. We define Non-GAAP operating loss as operating loss excluding share-based compensation, impairment of long-lived assets and amortization of intangible assets, and we define Non-GAAP operating loss margin as Non-GAAP operating loss as a percentage of revenues. We define Non-GAAP net loss as net loss excluding share-based compensation, foreign exchange (gain) loss and impairment of long-lived assets, and we define Non-GAAP net loss margin as Non-GAAP net loss as a percentage of revenues. We define Non-GAAP EBITDA as Non-GAAP net loss excluding interest income, interest expense, income tax expense (benefit) and depreciation and amortization, and we define Non-GAAP EBITDA margin as Non-GAAP EBITDA as a percentage of revenues. We present these non-GAAP financial measures because they are used by our management to evaluate our operating performance and formulate business plans. We also believe that the use of these non-GAAP measures facilitates investors’ assessment of our operating performance.

These non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. These non-GAAP financial measures have limitations as analytical tools. One of the key limitations of using these non-GAAP financial measures is that they do not reflect all items of income and expense that affect our operations. Further, these non-GAAP measures may differ from the non-GAAP information used by other companies, including peer companies, and therefore their comparability may be limited.

We compensate for these limitations by reconciling these non-GAAP financial measures to the nearest U.S. GAAP performance measure, all of which should be considered when evaluating our performance. We encourage you to review our financial information in its entirety and not rely on a single financial measure.

Exchange Rate Information

This press release contains translations of certain RMB amounts into U.S. dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from RMB to U.S. dollars, in this press release, were made at a rate ofRMB7.2993 to US$1.00, the noon buying rate in effect on December 31, 2024 as certified for customs purposes by the Federal Reserve Bank of New York.

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and similar statements. Among other things, the Business Outlook, and quotations from management in this announcement, as well as Kingsoft Cloud’s strategic and operational plans, contain forward-looking statements. Kingsoft Cloud may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (“SEC”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including but not limited to statements about Kingsoft Cloud’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Kingsoft Cloud’s goals and strategies; Kingsoft Cloud’s future business development, results of operations and financial condition; relevant government policies and regulations relating to Kingsoft Cloud’s business and industry; the expected growth of the cloud service market in China; the expectation regarding the rate at which to gain customers, especially Premium Customers; Kingsoft Cloud’s ability to monetize the customer base; fluctuations in general economic and business conditions in China; and the economy in China and elsewhere generally; China’s political or social conditions and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in Kingsoft Cloud’s filings with the SEC. All information provided in this press release and in the attachments is as ofthe date of this press release, and Kingsoft Cloud does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

About Kingsoft Cloud Holdings Limited

Kingsoft Cloud Holdings Limited (NASDAQ: KC and HKEX:3896) is a leading cloud service provider in China. With extensive cloud infrastructure, cutting-edge cloud-native products based on vigorous cloud technology research and development capabilities, well-architected industry-specific solutions and end-to-end fulfillment and deployment, Kingsoft Cloud offers comprehensive, reliable and trusted cloud service to customers in strategically selected verticals.

For more information, please visit: http://ir.ksyun.com.

For investor and media inquiries, please contact:
Kingsoft Cloud Holdings Limited
Nicole Shan
Tel: +86 (10) 6292-7777 Ext. 6300
Email: ksc–ir@kingsoft.com

KINGSOFT CLOUD HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(All amounts in thousands)
	Dec 31, 2023		Dec 31, 2024		Dec 31, 2024
	RMB		RMB		US$
ASSETS
Current assets:
Cash and cash equivalents	2,255,287		2,648,764		362,879
Restricted cash	234,194		81,337		11,143
Accounts receivable, net	1,529,915		1,468,663		201,206
Short-term investments	—		90,422		12,388
Prepayments and other assets	1,812,692		2,233,074		305,930
Amounts due from related parties	266,036		318,526		43,638
Total current assets	6,098,124		6,840,786		937,184
Non-current assets:
Property and equipment, net	2,186,145		4,630,052		634,315
Intangible assets, net	834,478		694,880		95,198
Goodwill	4,605,724		4,605,724		630,982
Prepayments and other assets	870,781		449,983		61,647
Equity investments	259,930		234,182		32,083
Amounts due from related parties	56,264		—		—
Operating lease right-of-use assets	158,832		137,047		18,775
Total non-current assets	8,972,154		10,751,868		1,473,000
Total assets	15,070,278		17,592,654		2,410,184

LIABILITIES, NON-CONTROLLING INTERESTS AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	1,805,083		1,877,004		257,149
Accrued expenses and other current liabilities	2,838,085		3,341,990		457,851
Short-term borrowings	1,110,896		2,225,765		304,928
Income tax payable	63,961		69,219		9,483
Amounts due to related parties	931,906		1,584,199		217,034
Current operating lease liabilities	78,659		61,258		8,392
Total current liabilities	6,828,590		9,159,435		1,254,837
Non-current liabilities:
Long-term borrowings	100,000		1,660,584		227,499
Amounts due to related parties	40,069		309,612		42,417
Deferred tax liabilities	142,565		101,677		13,930
Other liabilities	634,803		790,271		108,267
Non-current operating lease liabilities	78,347		65,755		9,008
Total non-current liabilities	995,784		2,927,899		401,121
Total liabilities	7,824,374		12,087,334		1,655,958
Shareholders’ equity:
Ordinary shares	25,443		25,689		3,519
Treasury stock	(208,385	)	(105,478	)	(14,450	)
Additional paid-in capital	18,811,028		18,940,885		2,594,891
Statutory reserves funds	21,765		32,001		4,384
Accumulated deficit	(12,315,041	)	(14,291,957	)	(1,957,990	)
Accumulated other comprehensive income	555,342		566,900		77,665
Total Kingsoft Cloud Holdings Limited shareholders’ equity	6,890,152		5,168,040		708,019
Non-controlling interests	355,752		337,280		46,207
Total equity	7,245,904		5,505,320		754,226
Total liabilities, non-controlling interests and shareholders’ equity	15,070,278		17,592,654		2,410,184

KINGSOFT CLOUD HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(All amounts in thousands, except for share and per share data)
	Three Months Ended												Twelve Months Ended
	Dec 31, 2023		Mar 31, 2024		Jun 30, 2024		Sep 30, 2024		Dec 31, 2024		Dec 31, 2024		Dec 31, 2023		Dec 31, 2024		Dec 31, 2024
	RMB		RMB		RMB		RMB		RMB		US$		RMB		RMB		US$
Revenues:
Public cloud services	1,051,966		1,187,370		1,234,542		1,175,535		1,409,804		193,142		4,381,741		5,007,251		685,991
Enterprise cloud services	670,331		588,162		657,238		710,039		822,338		112,660		2,663,993		2,777,777		380,554
Others	153		152		–		–		–		–		1,727		152		21
Total revenues	1,722,450		1,775,684		1,891,780		1,885,574		2,232,142		305,802		7,047,461		7,785,180		1,066,566
Cost of revenues	(1,469,312	)	(1,482,431	)	(1,573,433	)	(1,582,220	)	(1,806,170	)	(247,444	)	(6,197,292	)	(6,444,254	)	(882,859	)
Gross profit	253,138		293,253		318,347		303,354		425,972		58,358		850,169		1,340,926		183,707
Operating expenses:
Selling and marketing expenses	(126,477	)	(116,752	)	(125,708	)	(121,117	)	(115,792	)	(15,863	)	(460,221	)	(479,369	)	(65,673	)
General and administrative expenses	(294,240	)	(218,695	)	(266,249	)	(170,374	)	(179,536	)	(24,596	)	(1,060,022	)	(834,854	)	(114,375	)
Research and development expenses	(175,155	)	(231,963	)	(203,959	)	(235,912	)	(174,155	)	(23,859	)	(784,807	)	(845,989	)	(115,900	)
Impairment of long-lived assets	–		–		–		(919,724	)	–		–		(653,670	)	(919,724	)	(126,002	)
Total operating expenses	(595,872	)	(567,410	)	(595,916	)	(1,447,127	)	(469,483	)	(64,318	)	(2,958,720	)	(3,079,936	)	(421,950	)
Operating loss	(342,734	)	(274,157	)	(277,569	)	(1,143,773	)	(43,511	)	(5,960	)	(2,108,551	)	(1,739,010	)	(238,243	)
Interest income	12,442		8,370		9,945		4,517		4,176		572		78,410		27,008		3,700
Interest expense	(46,992	)	(51,066	)	(59,414	)	(57,404	)	(61,821	)	(8,469	)	(146,026	)	(229,705	)	(31,469	)
Foreign exchange gain (loss)	74,011		(42,737	)	(6,999	)	135,777		(105,572	)	(14,463	)	(57,211	)	(19,531	)	(2,676	)
Other (loss) gain, net	(16,741	)	(8,207	)	(7,829	)	6,046		(2,956	)	(405	)	(32,673	)	(12,946	)	(1,774	)
Other income (expense), net	33,776		(11,190	)	(4,961	)	4,433		5,336		731		100,363		(6,382	)	(874	)
Loss before income taxes	(286,238	)	(378,987	)	(346,827	)	(1,050,404	)	(204,348	)	(27,994	)	(2,165,688	)	(1,980,566	)	(271,336	)
Income tax (expense) benefit	(598	)	15,371		(6,891	)	(10,662	)	3,706		508		(17,959	)	1,524		209
Net loss	(286,836	)	(363,616	)	(353,718	)	(1,061,066	)	(200,642	)	(27,486	)	(2,183,647	)	(1,979,042	)	(271,127	)
Less: net loss attributable to non-controlling interests	(2,688	)	(4,206	)	(542	)	(3,931	)	(3,683	)	(505	)	(7,307	)	(12,362	)	(1,694	)
Net loss attributable to Kingsoft Cloud Holdings Limited	(284,148	)	(359,410	)	(353,176	)	(1,057,135	)	(196,959	)	(26,981	)	(2,176,340	)	(1,966,680	)	(269,433	)

Net loss per share:
Basic and diluted	(0.08	)	(0.10	)	(0.10	)	(0.29	)	(0.05	)	(0.01	)	(0.61	)	(0.54	)	(0.07	)
Shares used in the net loss per share computation:
Basic and diluted	3,570,915,939		3,614,662,846		3,649,307,331		3,655,882,906		3,710,632,202		3,710,632,202		3,558,354,940		3,658,088,876		3,658,088,876
Other comprehensive (loss) income, net of tax of nil:
Foreign currency translation adjustments	(67,636	)	20,704		(530	)	(112,296	)	103,658		14,201		102,241		11,536		1,580
Comprehensive loss	(354,472	)	(342,912	)	(354,248	)	(1,173,362	)	(96,984	)	(13,285	)	(2,081,406	)	(1,967,506	)	(269,547	)
Less: Comprehensive loss attributable to non-controlling interests	(2,662	)	(4,247	)	(570	)	(3,900	)	(3,667	)	(502	)	(7,334	)	(12,384	)	(1,697	)
Comprehensive loss attributable to Kingsoft Cloud Holdings Limited shareholders	(351,810	)	(338,665	)	(353,678	)	(1,169,462	)	(93,317	)	(12,783	)	(2,074,072	)	(1,955,122	)	(267,850	)

KINGSOFT CLOUD HOLDINGS LIMITED
RECONCILIATION OF GAAP AND NON-GAAP RESULTS
(All amounts in thousands, except for percentage)
	Three Months Ended						Twelve Months Ended
	Dec 31, 2023	Mar 31, 2024	Jun 30, 2024	Sep 30, 2024	Dec 31, 2024	Dec 31, 2024	Dec 31, 2023	Dec 31, 2024	Dec 31, 2024
	RMB	RMB	RMB	RMB	RMB	US$	RMB	RMB	US$
Gross profit	253,138	293,253	318,347	303,354	425,972	58,358	850,169	1,340,926	183,707
Adjustments:
– Share-based compensation expenses (allocated in cost of revenues)	9,330	5,814	5,076	4,252	1,726	236	9,757	16,868	2,311
Adjusted gross profit (Non-GAAP Financial Measure)	262,468	299,067	323,423	307,606	427,698	58,594	859,926	1,357,794	186,018

KINGSOFT CLOUD HOLDINGS LIMITED

RECONCILIATION OF GAAP AND NON-GAAP RESULTS

(All amounts in thousands, except for percentage)

Three Months Ended

Twelve Months Ended

Dec 31,
2023

Mar 31,
2024

Jun 30,
2024

Sep 30,
2024

Dec 31,
2024

Dec 31,
2023

Dec 31,
2024

Gross margin

14.7

%

16.5

%

16.8

%

16.1

%

19.1

%

12.1

%

17.2

%

Adjusted gross margin (Non-GAAP Financial Measure)

15.2

%

16.8

%

17.1

%

16.3

%

19.2

%

12.2

%

17.4

%

KINGSOFT CLOUD HOLDINGS LIMITED
RECONCILIATION OF GAAP AND NON-GAAP RESULTS
(All amounts in thousands, except for percentage)
	Three Months Ended												Twelve Months Ended
	Dec 31, 2023		Mar 31, 2024		Jun 30, 2024		Sep 30, 2024		Dec 31, 2024		Dec 31, 2024		Dec 31, 2023		Dec 31, 2024		Dec 31, 2024
	RMB		RMB		RMB		RMB		RMB		US$		RMB		RMB		US$
Net Loss	(286,836	)	(363,616	)	(353,718	)	(1,061,066	)	(200,642	)	(27,486	)	(2,183,647	)	(1,979,042	)	(271,127	)
Adjustments:
– Share-based compensation expenses	110,437		103,595		45,649		40,423		24,774		3,394		181,645		214,441		29,378
– Foreign exchange (gain) loss	(74,011	)	42,737		6,999		(135,777	)	105,572		14,463		57,211		19,531		2,676
– Impairment of long-lived assets	–		–		–		919,724		–		–		653,670		919,724		126,002
Adjusted net loss (Non-GAAP Financial Measure)	(250,410	)	(217,284	)	(301,070	)	(236,696	)	(70,296	)	(9,629	)	(1,291,121	)	(825,346	)	(113,071	)
Adjustments:
– Interest income	(12,442	)	(8,370	)	(9,945	)	(4,517	)	(4,176	)	(572	)	(78,410	)	(27,008	)	(3,700	)
– Interest expense	46,992		51,066		59,414		57,404		61,821		8,469		146,026		229,705		31,469
– Income tax expense (benefit)	598		(15,371	)	6,891		10,662		(3,706	)	(508	)	17,959		(1,524	)	(209	)
– Depreciation and amortization	187,542		223,146		305,304		358,540		376,100		51,525		940,482		1,263,090		173,043
Adjusted EBITDA (Non-GAAP Financial Measure)	(27,720	)	33,187		60,594		185,393		359,743		49,285		(265,064	)	638,917		87,532
– (Gain) loss on disposal of property and equipment	–		(23,821	)	–		(10,667	)	(10,137	)	(1,389	)	22,996		(44,625	)	(6,114	)
Excluding loss or gain on disposal of property and equipment, normalized Adjusted EBITDA	(27,720	)	9,366		60,594		174,726		349,606		47,896		(242,068	)	594,292		81,418

KINGSOFT CLOUD HOLDINGS LIMITED
RECONCILIATION OF GAAP AND NON-GAAP RESULTS
(All amounts in thousands, except for percentage)
	Three Months Ended												Twelve Months Ended
	Dec 31, 2023		Mar 31, 2024		Jun 30, 2024		Sep 30, 2024		Dec 31, 2024		Dec 31, 2024		Dec 31, 2023		Dec 31, 2024		Dec 31, 2024
	RMB		RMB		RMB		RMB		RMB		US$		RMB		RMB		US$
Operating loss	(342,734	)	(274,157	)	(277,569	)	(1,143,773	)	(43,511	)	(5,960	)	(2,108,551	)	(1,739,010	)	(238,243	)
Adjustments:
– Share-based compensation expenses	110,437		103,595		45,649		40,423		24,774		3,394		181,645		214,441		29,378
– Impairment of long-lived assets	–		–		–		919,724		–		–		653,670		919,724		126,002
– Amortization of intangible assets	44,656		43,517		43,415		43,460		43,104		5,905		180,459		173,496		23,769
Adjusted operating (loss) profit (Non-GAAP Financial Measure)	(187,641	)	(127,045	)	(188,505	)	(140,166	)	24,367		3,339		(1,092,777	)	(431,349	)	(59,094	)
– (Gain) loss on disposal of property and equipment	–		(23,821	)	–		(10,667	)	(10,137	)	(1,389	)	22,996		(44,625	)	(6,114	)
Excluding loss or gain on disposal of property and equipment, normalized Adjusted operating (loss) profit	(187,641	)	(150,866	)	(188,505	)	(150,833	)	14,230		1,950		(1,069,781	)	(475,974	)	(65,208	)

KINGSOFT CLOUD HOLDINGS LIMITED

RECONCILIATION OF GAAP AND NON-GAAP RESULTS

(All amounts in thousands, except for percentage)

Three Months Ended

Twelve Months Ended

Dec 31,
2023

Mar 31,
2024

Jun 30,
2024

Sep 30,
2024

Dec 31,
2024

Dec 31,
2023

Dec 31,
2024

Net loss margin

-16.7

%

-20.5

%

-18.7

%

-56.3

%

-9.0

%

-31.0

%

-25.4

%

Adjusted net loss margin (Non-GAAP Financial Measure)

-14.5

%

-12.2

%

-15.9

%

-12.6

%

-3.1

%

-18.3

%

-10.6

%

Adjusted EBITDA margin (Non-GAAP Financial Measure)

-1.6

%

1.9

%

3.2

%

9.8

%

16.1

%

-3.8

%

8.2

%

Normalized Adjusted EBITDA margin

-1.6

%

0.5

%

3.2

%

9.3

%

15.7

%

-3.4

%

7.6

%

Adjusted operating (loss) profit margin (Non-GAAP Financial Measure)

-10.9

%

-7.2

%

-10.0

%

-7.4

%

1.1

%

-15.5

%

-5.5

%

Normalized Adjusted operating (loss) profit margin

-10.9

%

-8.5

%

-10.0

%

-8.0

%

0.6

%

-15.2

%

-6.1

%

KINGSOFT CLOUD HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(All amounts in thousands)
	Three Months Ended						Twelve Months Ended
	Dec 31, 2023		Dec 31, 2024		Dec 31, 2024		Dec 31, 2023		Dec 31, 2024		Dec 31, 2024
	RMB		RMB		US$		RMB		RMB		US$
Net cash generated from (used in) operating activities	16,787		570,222		78,120		(169,070	)	628,419		86,093
Net cash used in investing activities	(1,414,761	)	(1,337,978	)	(183,302	)	(673,186	)	(3,620,445	)	(495,999	)
Net cash generated from (used in) financing activities	1,154,815		1,802,762		246,977		(227,852	)	3,255,418		445,990
Effect of exchange rate changes on cash, cash equivalents and restricted cash	1,013		(15,294	)	(2,095	)	25,863		(22,772	)	(3,119	)
Net (decrease) increase in cash, cash equivalents and restricted cash	(242,146	)	1,019,712		139,700		(1,044,245	)	240,620		32,965
Cash, cash equivalents and restricted cash at beginning of period	2,731,627		1,710,389		234,322		3,533,726		2,489,481		341,057
Cash, cash equivalents and restricted cash at end of period	2,489,481		2,730,101		374,022		2,489,481		2,730,101		374,022

MIL-OSI Banking: Chang Yong Rhee: Sustainability challenges in Korea

Source: Bank for International Settlements

I. Introduction

Ladies and gentlemen, distinguished guests, I am Rhee Changyong, Governor of the Bank of Korea.

It is an honor to join the Global Engagement & Empowerment Forum (GEEF) to discuss building a sustainable future. I sincerely thank Yonsei University President Yun Dongseob, former U.N. Secretary-General Ban Ki-moon, and everyone who made this event possible. I am also pleased to reconnect with former World Bank President Jim Yong Kim after my time in Washington, D.C.

Over the years, the GEEF has brought together global leaders, international organizations, businesses, and stakeholders to explore solutions for achieving the United Nations’ Sustainable Development Goals (SDGs). I hope this forum continues driving practical solutions to today’s sustainability challenges.

I am here to share Korea’s perspective on these issues. Some people say, “The Governor of the Bank of Korea is overstepping his bounds,” because I speak on social issues beyond monetary policy. Discussing the SDGs today may reinforce that perception. While central bankers debate their role in such discussions, sustainability challenges directly impact our economy and daily lives. For this reason, I cannot remain indifferent-not just as a central bank governor, but also as a citizen.

Sustainability takes many forms, but today I will focus on two urgent challenges for Korea’s economy. The first is climate change, a global crisis affecting everyone. The second is our declining birth rate and aging population, a challenge that is especially severe in Korea.

II. Climate Change

There is global and domestic consensus that human activities drive global warming and reducing carbon emissions is essential. However, Korea faces significant resistance to accelerating carbon reduction due to its heavily export-oriented economy dominated by high-carbon manufacturing industries. Strengthening emission reduction policies and environmental regulations raises concerns about export companies losing competitiveness. Thus, balancing urgent carbon reduction with sustaining industrial competitiveness has become a central issue.

However, climate change should not be viewed solely from the perspective of export industries. It is a crisis directly affecting our daily lives and quality of life. We are already experiencing more extreme heat waves, frequent flooding, and the gradual disappearance of familiar fruits and vegetables. Our summer rainfalls used to be predictable, but not anymore. If Los Angeles can experience massive wildfires, what is stopping Korea from experiencing similar disasters? Climate change is not distant-it is occurring now, and its impacts are unavoidable.

Air quality is a clear example. Last week, I visited Cape Town, South Africa, for a BIS meeting. While it was winter in Korea, it was summer there, with warm weather, a refreshing sea breeze, and remarkably clean air. Within days, I realized, “This is truly clean air.” Upon returning to Incheon Airport, I immediately felt a headache-not just from the flood of emails about economic and political concerns, but also from the noticeably poorer air quality. Korea’s air quality has improved recently, but after experiencing cleaner air in Washington, D.C., I can clearly sense the difference. As someone sensitive to lung health after experiencing long COVID, this difference is especially noticeable. Although conditions have improved, fine dust remains a serious issue.

Statistically, the cost of deteriorating air quality is undeniable. Over the past 15 years, diagnoses of atopic dermatitis and allergic rhinitis have doubled, and cases of heat exhaustion have quadrupled, now totaling 4,000. Climate change directly threatens our health, making the challenges of protecting public health increasingly severe as temperatures rise and pollution worsens.

Another example is the increased frequency of sudden downpours, repeatedly flooding Seoul’s Gangnam Station area, one of Korea’s wealthiest neighborhoods, submerging numerous luxury vehicles over the past several years. Beyond property damage, the human toll has been devastating. Just two years ago, 14 people tragically lost their lives when an underpass collapsed after 500mm of rain fell in thirteen days. Observing these intense summer storms reminds me of tropical squalls typically seen in Thailand or South America.

The Korea Meteorological Administration now classifies rainfall exceeding 50mm per hour or 90mm over three hours as “extreme heavy rain,” conditions responsible for 80% of flood damage. These extreme events have more than doubled since the 1970s. Given these dramatic changes, it is unclear whether our current flood prevention infrastructure-such as dams, embankments, and drainage systems-can handle the intensifying conditions. About 20% of national river embankments are already rated as “inadequate” or “poor,” and projections suggest half of Korea’s dams may fail to prevent flooding by 2040. We must proactively strengthen infrastructure now to withstand growing climate challenges.

Third, climate change is disrupting our food supply. Last year, I faced criticism from agricultural stakeholders after suggesting apple imports due to soaring prices (Im et al., 2024). Initially, I anticipated resistance primarily from traditional apple-growing regions like Daegu and North Gyeongsang Province. However, apple production areas are gradually shifting northward. Apple cultivation in Daegu-Gyeongbuk has decreased by nearly half compared to 30 years ago. Once grown nationwide, except for the southern coast and Jeju Island, projections suggest high-quality apples will only be viable in Gangwon Province’s mountainous areas by the 2030s, due to rapid climate change (Rural Development Administration, 2022). Within a decade, importing apples will likely become a necessity rather than controversial.

The fishing industry faces similar disruptions. Pollack, once a staple in Korea, has nearly vanished from local waters, with catches below one ton since 2019. Traditional species like croaker and anchovies are declining, while warmer-water species like yellowtail and mackerel are increasing. Korea’s fishing industry must rapidly adapt by modernizing vessels, gear, and aquaculture techniques to match the changing marine ecosystem.

While countless examples exist, the core message is clear. Climate change is not just a challenge for export industries-it already deeply impacts our daily lives and various domestic sectors. Thus, addressing climate change and reducing carbon emissions is not a matter of choice-it is an urgent necessity.

Although the government has initiated policy efforts, substantial progress remains necessary. First, Korea’s Green Taxonomy (K-Taxonomy) must align with international standards to clearly define “environmentally friendly” activities, signaling strong support for carbon reduction. Second, carbon pricing must be more realistic. Last April, the global average carbon price was approximately $30 per ton, reaching $60 per ton in the EU, compared to only $6 per ton in Korea. At this price, companies find it more economical to buy emission credits than reduce emissions, undermining carbon reduction targets. Third, structural improvements to Korea’s Emissions Trading System (K-ETS) are needed. Gradually reducing the 90% free allocation rate and tightening the emissions cap will create stronger market incentives for effective emissions trading.

The Bank of Korea is also increasing its efforts by conducting financial stress tests on climate-related risks. Financial institutions traditionally manage risks like loan defaults and real estate fluctuations, but climate-driven risks introduce unexpected tail risks not yet fully considered. Events like Los Angeles’ wildfires or Australia’s six-month wildfire crisis in 2019 are not distant threats. They serve as warnings for Korea. Severe localized climate damage could cause significant financial losses for households and businesses, destabilizing financial institutions and spreading shocks throughout the economy.

Thus, the Bank of Korea actively researches climate risks’ impacts on our industries and financial system, conducting stress tests with financial institutions under various scenarios. Next Tuesday, we will present these climate stress test results at a joint conference with the Financial Supervisory Service.

Bank of Korea employees are also committed to reducing carbon emissions through research (Kim et al., 2024) and daily practices. Believing even small actions matter, we have adopted eco-friendly measures such as using recycled-paper business cards, reducing plastic use, turning off unused lights, and implementing license plate-based driving restrictions.

III. Ultra Low Fertility and an Aging Population

Beyond climate change, one of the most pressing sustainability challenges is our demographic crisis-an aging population combined with extremely low fertility rates. Korea’s total fertility rate slightly rose to 0.75 in 2024 from 0.72 in 2023. Although this small uptick is welcome, a fertility rate of 0.75 remains a national emergency. If this trend continues, Korea faces an irreversible population crisis that threatens economic stability and social cohesion.

Some people suggest that population decline might have benefits, such as reduced pollution, lower energy consumption, and higher GDP per capita, possibly enhancing quality of life. However, this view dangerously oversimplifies the issue. A fertility rate of 0.75 leads not to gradual decline but rapid demographic collapse, undermining economic and social stability. By contrast, the OECD average fertility rate of 1.4 results in a more manageable and sustainable population decline.

The difference between fertility rates of 0.75 and 1.4 significantly impacts economic growth prospects. At 0.75, Korea’s population would shrink from 51.7 million to 30 million in 50 years, just 58% of today’s figure, declining annually by 1.1%. In contrast, at a rate of 1.4, the population decline is less severe, reaching 43 million-83% of today’s level-with an annual drop of 0.4%. From a purely demographic standpoint, the difference in GDP growth between these two scenarios would amount to 0.4 percentage points annually. But the true cost goes beyond this simple calculation. A declining youth population, crucial for innovation, entrepreneurship, and economic dynamism, would severely undermine Korea’s long-term growth potential. According to a recent Bank of Korea study, Korea’s potential growth rate, currently around 2%, may approach near 0% by the late 2040s (Lee et al., 2024). If the fertility rate remains at 0.75, Korea will inevitably face prolonged negative economic growth after 2050. Conversely, at 1.4, Korea could maintain positive economic growth well into the future.

Beyond GDP, persistently low fertility will create substantial fiscal strain, increasing the burden on younger generations. As the elderly population surges, spending on pensions, healthcare, and elder care will rise significantly. According to the National Assembly Budget Office (2025), Korea’s national debt-to-GDP ratio, currently 46.9%, is projected to reach 182% within 50 years if fertility remains at 0.75. If fertility improves to 1.4, the ratio would increase more slowly, reaching 163%. The burden on young Koreans will become particularly overwhelming. Currently, four working-age individuals support each elderly person. At a fertility rate of 0.75, this ratio will decline to one-to-one within 50 years. At 1.4, however, it remains more manageable, easing strain on future generations.

Moreover, economic instability from demographic shifts increases society’s vulnerability to populism. Stagnant growth exacerbates income inequality, deepens generational and class divides, and fuels political polarization. Politicians and governments may resort to populist fiscal policies, such as direct cash handouts and temporary welfare measures, providing short-term relief without addressing underlying issues. Such policies risk creating a cycle of fiscal inefficiency and mounting national debt, exacerbating rather than resolving the core problems.

To preserve economic sustainability, decisive action must be taken urgently. If Korea’s fertility rate remains critically low without significant expansion of the workforce through foreign labor, the country risks chronic negative growth, soaring debt, and escalating social tensions. Avoiding this scenario requires raising the fertility rate to a more viable level. Completely reversing population decline may be unrealistic since many advanced economies face similar demographic challenges, but Korea cannot afford to remain passive. At a minimum, we must strive to reach the OECD average fertility rate of 1.4.

Why has Korea’s fertility rate fallen so drastically? The answer lies in structural barriers discouraging young people from marriage and parenthood. Bank of Korea studies indicate young Koreans delay or forgo marriage and childbirth due to intense competition and anxieties over employment, housing, and childcare. Young people today face fierce competition for scarce, high-quality jobs, making career stability difficult. Simultaneously, soaring housing prices make homeownership seem unattainable. Under these pressures, raising children is more than challenging-it is an overwhelming financial and emotional burden.

A major driver of this crisis is the extreme concentration of population and economic activity in the Seoul metropolitan area. A recent Bank of Korea study analyzing fertility trends in 35 OECD countries identified Korea’s urban concentration as among the highest globally, pinpointing it as a key factor behind the country’s ultra-low fertility (Hwang et al., 2023). Over 50% of Korea’s GDP, population, and jobs are concentrated in the Seoul metropolitan area-much higher than 5% in the U.S. and Germany, 10-20% in the U.K. and Italy, 20-30% in France, and 30% in Japan. While Korea’s rapid economic development-the “Miracle on the Han River”-transformed the country into an economic powerhouse, it also centralized infrastructure, talent, and opportunities in Seoul. Consequently, young people continue migrating to the capital for career prospects, draining vitality from regional economies and pushing many toward demographic extinction.

Korea’s highly competitive university entrance system further reinforces the population concentration in the Seoul metropolitan area. Admission to prestigious universities is considered essential-not only for stable employment but also for social status and marriage prospects. This fuels intense competition for limited spots at elite universities, overwhelmingly located in Seoul. Private education has become critical, prompting families to relocate to Seoul’s affluent areas like Gangnam-gu, known for high-quality private educational infrastructure. Many parents unable to afford homeownership instead rely on costly rental housing to secure educational advantages. This strategy appears justified, as students from Seoul account for 32% of admissions to Seoul National University (SNU), despite representing only 16% of school-age population. More strikingly, students from Gangnam-gu alone constitute 12% of SNU admissions, three times the district’s 4% share of school-age residents (Chung et al., 2024). Relocating to Gangnam-gu is thus seen as essential for top university admission, intensifying Seoul’s population density, raising housing prices, and worsening the fertility crisis.

Korea’s university admission system is excessively competitive by any standard. Parents sacrifice their quality of life and retirement savings, investing considerable resources to secure their children’s admission to elite universities. Paradoxically, this intense pursuit of academic success imposes a heavy cost on both parents and children. From as early as kindergarten, students experience relentless pressure and burnout, depriving them of childhood joys and a healthy adolescence.

Korea’s critically low fertility rate (0.75), extreme population concentration in the Seoul metropolitan area, and overheated university competition seem like separate issues but are deeply interconnected. Left unresolved, these challenges-drastic population decline, persistent negative economic growth, escalating social tensions, and diminishing opportunities for youth-will push Korea toward an unsustainable tipping point. Addressing these structural issues simultaneously is challenging, yet the urgency demands bold action. Recognizing this, the Bank of Korea recently proposed two policy suggestions: foster a limited number of regional hub cities and implement a “regional proportional admission system” for universities.

First, to effectively reduce the extreme population concentration in the Seoul metropolitan area, we must strategically develop a small number of regional hub cities. Over the past two decades, regional development policies have been introduced to address this imbalance. However, due to political challenges and efforts to evenly distribute resources nationwide, these initiatives have been too fragmented to meaningfully curb Seoul’s dominance.

According to Bank of Korea research, the optimal approach-given Korea’s land area and population-is to concentrate substantial investments in two to six carefully selected regional hub cities. Targeted, large-scale investment in critical infrastructure, such as healthcare, education, and cultural amenities, is essential to providing a quality of life comparable to Seoul, thus effectively attracting and retaining residents (Chung et al., 2023, 2024). Pursuing this focused strategy will rebalance population distribution, revitalize regional economies-including surrounding smaller cities-and achieve sustainable national development.

In parallel, bold reforms to Korea’s college admissions system are essential. The Bank of Korea has proposed a “regional proportional admission system,” where universities voluntarily allocate admissions based on each region’s proportion of high school seniors (Chung et al., 2024). Despite multiple revisions to university entrance system, excessive competition in university admissions remains unresolved. BOK’s new proposal seeks to enhance universities’ autonomy in admissions while strongly requiring balanced regional representation-a crucial step to address extreme competition. Adopting this system offers several benefits. First, it reduces the disproportionate influence of socioeconomic factors such as parental wealth and private education, thus significantly enhancing social mobility. Second, dispersing admissions competition from Seoul would ease demographic pressures, stabilize housing prices, and improve fertility rates. Third, attracting students from diverse regions promotes mutual understanding, social cohesion, and reduces regional disparities.

This proposal does not require government intervention or legal amendments, relying instead on the willingness and initiative of leading universities. In Korea, there remains a strong belief that selecting students based solely on academic scores is the fairest, leading resistance to this proposal. Some universities argue they already implement regional proportional admissions for roughly 15% of their freshmen. However, such limited quotas can stigmatize these students and have insufficient impact on demographic or housing pressures in Seoul. To be effective, regional proportional admissions must be applied to most incoming students’ admissions. In many advanced nations, regional diversity in admissions is widely accepted and encouraged. I believe Dr. Jim Yong Kim, joining us today and a former president of Dartmouth College, understands this issue well. He could highlight how Korea’s test score-based admissions approach is an exception globally, and how this reform could realistically occur through proactive leadership at major universities.

In my view, allowing universities greater flexibility in evaluating applicants-under regional proportional requirements-would better acknowledge and fairly recognize diverse talents. Human talent is far too diverse to be measured by academic tests alone. Yet, Korea’s current admissions system prioritizes a narrow skillset: memorization, quick mathematical calculations, and rapid text summarization under time pressure. These skills, overly rewarded by standardized exams, limit the range of recognized talents. I happen to possess these particular skills and was a major beneficiary of Korea’s college admission system. However, if asked to write a creative essay over a week, I might not have excelled. Today, elite university students often share certain defining characteristics such as a personality that diligently follows instructions without rebellion, a willingness to endure 15 years of repetitive study from kindergarten, an IQ high enough to handle the academic workload, but not so high as to question or challenge its purpose.

When Korea’s primary goal was catching up with more advanced nations, the current educational system was beneficial in developing individuals who excelled at following orders and carrying out assigned tasks. However, with Korea now at the forefront of global technological competition, we need people unafraid to explore new frontiers, bringing diverse backgrounds and innovative thinking. Additionally, we must foster an environment that encourages collaboration, creativity, and meaningful interaction. It is time for universities to broaden their evaluation criteria and nurture diverse talents by implementing regional proportional admissions.

The challenges highlighted today-climate change and demographic crisis-pose critical threats and require urgent action. Korea has achieved remarkable economic progress, joining the ranks of advanced nations. Now we must focus on enhancing individual well-being, ensuring prosperity and happiness for all citizens. Through bold decisions, we can develop vibrant, youth-friendly, green regional hubs that combat climate change and support marriage and childbirth. The Bank of Korea remains fully committed to securing a sustainable, prosperous future for upcoming generations.

Thank you for your time and attention.

This speech was prepared with the assistance of Sanghun Park and Joonki Min from the Office of Sustainable Growth, and Inro Lee and Inkyung Yoo from the Economic Research Institute.

References

Kim J. Y., Ryu G. B., Hwang J. H., Kim H. J., Kim H. N., Lee H. A., and Sim S. B. 2024. “The Impact of Climate Change Risks on the Real Economy: Analysis by Climate Response Scenarios.” BOK Issue Note No. 2024-30, Bank of Korea.

Rural Development Administration. 2022. “Prediction of Changes in Cultivation Areas for Six Major Fruits Considering Climate Change Scenarios.” Press Release.
Lim W. J., Lee D. J., Lee Y. S., and Park C. H. 2024. “Characteristics and Implications of Korea’s Price Levels: A Comparison with Major Countries.” BOK Issue Note No. 2024-14, Bank of Korea.

Chung M. S., Kim E. J., Lee H. S., Hong S. J., and Lee D. R. 2023. “Interregional Population Migration and Regional Economy.” BOK Issue Note No. 2023-29, Bank of Korea.

Chung M. S., Lee Y. H., Yoo J. S., and Kim E. J. 2024. “Analysis of Regional Economic Growth Factors and Balanced Development Focused on Hub Cities.” BOK Issue Note No. 2024-15, Bank of Korea.

Chung J. W., Lee D. W., and Kim H. J. 2024. “Adressing Social Issues Steming from Excessive Competition in College Admissions.” BOK Issue Note No. 2024-26, Bank of Korea.

Hwang I. D., Nam Y. M., Sund W., Shim S. R., Yeom J., Lee B. J., Lee H. R., Chung J. W., Cho T. H., Choi Y. J., Hwang S. W., and Son M. K. 2023. “Lowest-low Fertility and Super-aged Society: Causes and Impacts of the Extreme Population Structure, and Policy Options.” In-Depth Analysis, Korea Economy Outlook, Bank of Korea.

Lee E. K., Chun D. M., Kim J. W., and Lee D. J. 2024. “Potential Growth Rate of the Korean Economy and Future Outlook.” BOK Issue Note No. 2024-33, Bank of Korea.

Lim W. J., Lee D. J., Lee Y. S., and Park C. H. 2024. “Characteristics and Implications of Korea’s Price Levels: A Comparison with Major Countries.” BOK Issue Note No. 2024-14, Bank of Korea.

National Assembly Budget Office. 2025. “2025-2072 NABO Long-Term Fiscal Outlook.”

MIL OSI Global Banks –

MIL-OSI: One Stop Systems Reports Q4 2024 Results

Source: GlobeNewswire (MIL-OSI)

Strength in both segments contributed to consolidated year-over-year revenue growth for Q4 2024

Consolidated revenue increased sequentially every quarter throughout 2024, reflecting the success of the Company’s transformation strategy to higher-growth markets

Management expects double-digit consolidated revenue growth in 2025, driven by anticipated OSS segment revenue of over 20% and consolidated EBITDA break even for the year

ESCONDIDO, Calif., March 19, 2025 (GLOBE NEWSWIRE) — One Stop Systems, Inc. (“OSS” or the “Company”) (Nasdaq: OSS), a leader in rugged Enterprise Class compute for artificial intelligence (AI), machine learning (ML) autonomy and sensor processing at the edge, reported results for the three- and twelve-month periods ended December 31, 2024. Comparisons for the three- and twelve-month periods are to the same year-ago periods unless otherwise noted.

“I am pleased to report a return to consolidated year-over-year revenue growth for the fourth quarter, as sales from both our OSS and Bressner segments grew at double digit rates. Throughout 2024 we executed on our multi-year transformation, making significant progress in shifting our business toward higher-margin, higher-growth markets. We invested in our platform, strengthened our pipeline, and deepened collaboration with customers developing high-performance, Enterprise Class, edge computing solutions for both commercial and defense applications,” stated OSS President and CEO, Mike Knowles.

“As efforts to reposition the Company for revenue growth gained momentum during 2024 and our business model evolved, we adjusted our legacy inventory and program costs to better align with our focus on improving efficiencies and increasing profitability. We believe the progress we made in 2024 strengthened our business, positioning the Company for higher sales and profitability in 2025 and beyond,” concluded Mr. Knowles.

2024 Fourth-Quarter Financial Summary

Consolidated revenue was $15.1 million, compared to $13.2 million in the fourth quarter of 2023. The 15.1% year-over-year increase was a result of a $1.3 million increase in Bressner segment revenue and a $642,000 year-over-year increase in OSS segment revenue. The 10% year-over-year increase in OSS segment revenue was primarily due to higher revenue from defense and commercial customers, as well as new customer-funded development orders, aligned directly with the Company’s strategic focus and plan.

The following table sets forth net revenue by segment for the three months ended December 31, 2024, and December 31, 2023 (Dollars may not calculate due to rounding):

	Three Months Ended
Entity:	December 31, 2024		% of Net Revenue		December 31, 2023		% of Net Revenue		% Change
OSS	$	7,042,613	46.5	%	$	6,401,047	48.7	%	10.0	%
Bressner		8,097,533	53.5	%		6,754,161	51.3	%	19.9	%
Total net revenue	$	15,140,146	100.0	%	$	13,155,209	100.0	%	15.1	%

During the fourth quarter ended December 31, 2024, the Company took a charge related to contract losses of $1.2 million for incurred and anticipated costs to satisfy performance obligations on a customer-funded development contract that was entered into in 2022. This charge reduced reported gross margin, net income, and adjusted EBITDA for the three- and twelve-month periods ended December 31, 2024. Management does not currently foresee any further charges related to this customer-funded development contract.

Consolidated gross margin percentage was 15.7%, compared to 33.7% in the prior year quarter. Gross margin, excluding the one-time charges, was 23.8%, compared to 33.7% in the same period last year. The decrease in gross margin was primarily due to product mix.

On a segment basis, the OSS segment had a gross margin of 9.4%, compared to 45.9% for the same period a year ago. OSS segment gross margin, excluding the one-time charges, was 26.8%, compared to 45.9%. The decrease from the same period last year was primarily driven by product mix. The Company’s Bressner segment had a gross margin percentage of 21.2%, compared to 22.2% in the same period last year.

Total operating expenses increased 15.1% to $5.5 million. This increase was predominantly attributable to higher general and administrative costs related to planned sales and program management investments made during the quarter.

The Company reported a net loss of $3.1 million, or $(0.15) per share, as compared to a net loss of $278,000, or $(0.01) per share, in the prior year period.

Adjusted EBITDA, a non-GAAP metric, was a loss of $2.3 million, inclusive of $1.2 million in one-time charges, compared to adjusted EBITDA of $322,000 in the prior year period.

As of December 31, 2024, the Company reported cash and short-term investments of $10.0 million and total working capital of $24.0 million, compared to cash and short-term investments of $11.8 million and total working capital of $35.6 million at December 31, 2023. The reduction in cash and short-term investments was primarily driven by the paydown of $1 million of notes payable.

2024 Twelve Months Financial Summary

Consolidated revenue was $54.7 million, compared to $60.9 million for the same period last year. The 10.2% year-over-year reduction in consolidated revenue was primarily a result of approximately $4.8 million related to a former media customer, for whom shipments ceased in the second quarter of 2023. This decrease was partially offset by higher sales to customers in the military and defense end markets. In addition, Bressner segment revenue declined by $2.0 million on a year-over-year basis, associated with slower economic activity in the German economy.

The following table sets forth net revenue by segment for the twelve months ended December 31, 2024, and December 31, 2023 (Dollars may not calculate due to rounding):

	Twelve Months Ended
Entity:	December 31, 2024		% of Net Revenue		December 31, 2023		% of Net Revenue		% Change
OSS	$	24,558,809	44.9	%	$	28,809,888	47.3	%	(14.8	)%
Bressner		30,135,550	55.1	%		32,086,910	52.7	%	(6.1	)%
Total net revenue	$	54,694,358	100.0	%	$	60,896,798	100.0	%	(10.2	)%

For the year ended December 31, 2024, the Company incurred a total of $8.3 million of one-time charges that reduced reported gross margin, net income, and adjusted EBITDA. During the fourth quarter of 2024, the Company took a charge related to contract losses of $1.2 million for incurred and anticipated costs to satisfy performance obligations on a customer-funded development contract that was entered into in 2022. Additionally, during the year, OSS incurred $7.1 million of inventory charges related to obsolete and slow-moving inventory associated with the transition of the Company’s business model and operating strategies, as well as slower adoption and movement in certain commercial and defense edge compute markets. Management does not currently foresee any further significant adjustments to costs related to this customer-funded development contract or inventory charges, outside of historical trends.

Consolidated gross margin percentage was 14.1%, compared to 29.5% in the prior year. On a full year basis, consolidated gross margin, excluding one-time charges, was 29.3%, compared to 29.5% in 2023.

On a segment basis, the Company’s OSS segment had a gross margin of 2.5%, compared to 35.6% for the same period a year ago. OSS segment gross margin, excluding one-time charges, was 36.4%, up from 35.6% for 2023. The Company’s Bressner segment had a gross margin of 23.5%, compared to 24.0% in the same period last year.

Total operating expenses decreased 18.6% to $21.1 million. This decrease was predominantly attributable to a charge of $5.6 million for an impairment of goodwill that occurred during the 2023 twelve-month period, the elimination of costs associated with organizational restructuring, timing of certain new product introduction activities and the deployment of engineering resources onto customer funded development efforts, partially offset by increased costs for personnel and for tradeshow participation.

The Company reported a net loss of $13.6 million, or $(0.65) per share, as compared to a net loss of $6.7 million, or $(0.32) per share, in the prior year. Non-GAAP net loss and loss per share was $11.6 million, or $(0.56) per share, as compared to non-GAAP net loss and loss per share of $415,000, or $(0.02) per share, in the prior year period. Net loss and non-GAAP net loss for the period ended December 31, 2024, are inclusive of $8.3 million of one-time charges.

Adjusted EBITDA, a non-GAAP metric, was a loss of $10.3 million, inclusive of $7.1 million of inventory-related charges and a $1.2 million contract loss related to a customer-funded development contract that was entered into in 2022, compared to adjusted EBITDA of $1.1 million in the prior year.

2025 Full Year Outlook

The Company anticipates consolidated revenue of $59 to $61 million for the full year of 2025. This includes expected OSS segment revenue of approximately $30 million, representing over 20% year-over-year growth in the OSS segment. In addition, the Company expects to be EBITDA break-even for the full year of 2025. Management expects revenue and profitability to improve at a higher rate in the second half of 2025 based on current trends and the Company’s expanding sales pipeline.

Conference Call

OSS will hold a conference call to discuss its results for the fourth quarter of 2024, followed by a question-and-answer period.

Date: Wednesday, March 19, 2025
Time: 10:00 a.m. ET (7:00 a.m. PT)
Toll-free dial-in: 1-800-717-1738
International dial-in: 1-646-307-1865
Conference ID: 35863 (required for entry)
Webcast: https://viavid.webcasts.com/starthere.jsp?ei=1706031&tp_key=7e52a82afd

A replay of the call will be available after 1:00 p.m. ET on March 19, 2025, through April 2, 2025.

Toll-free replay: 1-844-512-2921
International replay: 1-412-317-6671
Passcode: 1135863

About One Stop Systems

One Stop Systems, Inc. (Nasdaq: OSS) is a leader in AI enabled solutions for the demanding ‘edge’. OSS designs and manufactures Enterprise Class compute and storage products that enable rugged AI, sensor fusion and autonomous capabilities without compromise. These hardware and software platforms bring the latest data center performance to harsh and challenging applications, whether they are on land, sea or in the air.

OSS products include ruggedized servers, compute accelerators, flash storage arrays, and storage acceleration software. These specialized compact products are used across multiple industries and applications, including autonomous trucking and farming, as well as aircraft, drones, ships and vehicles within the defense industry.

OSS solutions address the entire AI workflow, from high-speed data acquisition to deep learning, training and large-scale inference, and have delivered many industry firsts for industrial OEM and government customers.

As the fastest growing segment of the multi-billion-dollar edge computing market, AI enabled solutions require—and OSS delivers—the highest level of performance in the most challenging environments without compromise.

OSS products are available directly or through global distributors. For more information, go to www.onestopsystems.com. You can also follow OSS on X, YouTube, and LinkedIn.

Non-GAAP Financial Measures

We believe that the use of adjusted earnings before interest, taxes, depreciation and amortization, or adjusted EBITDA, is helpful for an investor to assess the performance of the Company. The Company defines adjusted EBITDA as income (loss) before interest, taxes, depreciation, amortization, acquisition expense, impairment of long-lived assets, financing costs, government funded programs, fair value adjustments from purchase accounting, stock-based compensation expense, and expenses related to discontinued operations.

Adjusted EBITDA is not a measurement of financial performance under generally accepted accounting principles in the United States, or GAAP. Because of varying available valuation methodologies, subjective assumptions and the variety of equity instruments that can impact a company’s non-cash operating expenses, we believe that providing a non-GAAP financial measure that excludes non-cash and non-recurring expenses allows for meaningful comparisons between our core business operating results and those of other companies, as well as providing us with an important tool for financial and operational decision making and for evaluating our own core business operating results over different periods of time.

Our adjusted EBITDA measure may not provide information that is directly comparable to that provided by other companies in our industry, as other companies in our industry may calculate non-GAAP financial results differently, particularly related to non-recurring and unusual items. Our adjusted EBITDA is not a measurement of financial performance under GAAP, and should not be considered as an alternative to operating income or as an indication of operating performance or any other measure of performance derived in accordance with GAAP. We do not consider adjusted EBITDA to be a substitute for, or superior to, the information provided by GAAP financial results.

	For the Three Months Ended December 31,						For the Year Ended December 31,
	2024			2023			2024			2023
Net loss	$	(3,134,782	)	$	(277,560	)	$	(13,634,333	)	$	(6,716,176	)
Depreciation and amortization of intangibles		226,417			263,743			1,041,837			1,077,516
Amortization of right-of-use assets, net of changes in lease liability		(2,488	)		(30,208	)		29,885			22,592
Stock-based compensation expense		564,176			454,461			1,988,125			2,345,358
Interest expense		3,206			29,662			74,116			117,774
Interest income		(100,805	)		(159,487	)		(477,745	)		(544,958	)
Impairment of goodwill		–			–			–			5,630,788
Employee retention credit (ERC)		–			–			–			(1,716,727	)
Provision for income taxes		157,120			41,796			726,502			927,128
Adjusted EBITDA	$	(2,287,156	)	$	322,407		$	(10,251,613	)	$	1,143,296

FOOTNOTE: Adjusted EBITDA for the fourth quarter and full year ended December 31, 2024, included a charge related to contract losses of $1.2 million for incurred and anticipated costs to satisfy performance obligations on a customer-funded development contract that was entered into in 2023. Adjusted EBITDA for the full year ended December 31, 2024, also included inventory-related charges of $7.1 million.

(Dollars may not calculate due to rounding)

Adjusted EPS excludes the impact of certain items and, therefore, has not been calculated in accordance with GAAP. We believe that exclusion of certain selected items assists in providing a more complete understanding of our underlying results and trends and allows for comparability with our peer company index and industry. We use this measure along with the corresponding GAAP financial measures to manage our business and to evaluate our performance compared to prior periods and the marketplace. The Company defines non-GAAP income (loss) as income or (loss) before amortization, government funded programs, impairment of long lived assets, stock-based compensation, expenses related to discontinued operations, and acquisition costs. Adjusted EPS expresses adjusted income (loss) on a per share basis using weighted average diluted shares outstanding.

Adjusted EPS is a non-GAAP financial measure and should not be considered in isolation or as a substitute for financial information provided in accordance with GAAP. These non-GAAP financial measures may not be computed in the same manner as similarly titled measures used by other companies. We expect to continue to incur expenses similar to the adjusted income from continuing operations and adjusted EPS financial adjustments described above, and investors should not infer from our presentation of these non-GAAP financial measures that these costs are unusual, infrequent or non-recurring.

The following table reconciles non-GAAP net income and basic and diluted earnings per share:

	For the Three Months Ended December 31,						For the Full Year Ended December 31,
	2024			2023			2024			2023
Net loss	$	(3,134,782	)	$	(277,560	)	$	(13,634,333	)	$	(6,716,176	)
Amortization of intangibles		–			–			–			42,154
Impairment of goodwill		–			–			–			5,630,788
Employee retention credit (ERC)		–			–			–			(1,716,727	)
Stock-based compensation expense		564,176			454,461			1,988,125			2,345,358
Non-GAAP net loss	$	(2,570,606	)	$	176,901		$	(11,646,208	)	$	(414,603	)
Non-GAAP net loss per share:
Basic	$	(0.12	)	$	0.01		$	(0.56	)	$	(0.02	)
Diluted	$	(0.12	)	$	0.01		$	(0.56	)	$	(0.02	)
Weighted average common shares outstanding:
Basic		21,120,396			20,632,300			20,953,397			20,854,777
Diluted		21,120,396			20,632,300			20,953,397			20,854,777

FOOTNOTE: Non-GAAP net loss for the fourth quarter and full year ended December 31, 2024, included a charge related to contract losses of $1.2 million for incurred and anticipated costs to satisfy performance obligations on a customer-funded development contract that was entered into in 2023. Non-GAAP net loss for the full year ended December 31, 2024, also included an inventory charge of $6.1 million.

(Dollars may not calculate due to rounding)

Forward-Looking Statements

One Stop Systems cautions you that statements in this press release that are not a description of historical facts are forward-looking statements. These statements are based on the company’s current beliefs and expectations. The inclusion of forward-looking statements should not be regarded as a representation by One Stop Systems or its partners that any of our plans or expectations will be achieved, including but not limited to, our ability to expand our product offerings and further penetrate our target markets, future demand for AI/ML integrations, expected or anticipated increase in revenues, and our business strategies. Actual results may differ from those set forth in this press release due to the risk and uncertainties inherent in our business, including risks described in our prior press releases and in our filings with the Securities and Exchange Commission (SEC), including under the heading “Risk Factors” in our latest Annual Report on Form 10-K and any subsequent filings with the SEC. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and the company undertakes no obligation to revise or update this press release to reflect events or circumstances after the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement, which is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Media Contacts:
Robert Kalebaugh
One Stop Systems, Inc.
Tel (858) 518-6154
Email contact

Investor Relations:
Andrew Berger
Managing Director
SM Berger & Company, Inc.
Tel (216) 464-6400
Email contact

ONE STOP SYSTEMS, INC. (OSS)
CONSOLIDATED BALANCE SHEETS

	Audited			Audited
	December 31,			December 31,
	2024			2023
ASSETS
Current assets
Cash and cash equivalents	$	6,794,093		$	4,048,948
Short-term investments		3,217,065			7,771,820
Accounts receivable, net		8,177,371			8,318,247
Inventories, net		13,176,156			21,694,748
Prepaid expenses and other current assets		836,364			611,066
Total current assets		32,201,048			42,444,829
Property and equipment, net		1,669,026			2,370,224
Operating lease right-of use assets		1,536,094			1,922,784
Deposits and other		38,093			38,093
Goodwill		1,489,722			1,489,722
Total Assets	$	36,933,982		$	48,265,652

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	2,068,017		$	1,201,781
Accrued expenses and other liabilities		4,806,675			3,202,519
Current portion of operating lease obligation		285,937			390,926
Current portion of notes payable		1,035,050			2,077,895
Total current liabilities		8,195,679			6,873,121
Deferred tax liability, net		52,574			44,673
Operating lease obligation, net of current portion		1,513,684			1,765,536
Total liabilities		9,761,937			8,683,330
Commitments and contingencies
Stockholders’ equity
Common stock, $0.0001 par value; 50,000,000 shares authorized; 21,148,810 and 20,661,341 shares issued and outstanding at December 31, 2024 and 2023, respectively		2,115			2,066
Additional paid-in capital		49,082,737			47,323,673
Accumulated other comprehensive income		140,254			675,310
Accumulated deficit		(22,053,061	)		(8,418,727	)
Total stockholders’ equity		27,172,045			39,582,322
Total Liabilities and Stockholders’ Equity	$	36,933,982		$	48,265,652

ONE STOP SYSTEMS, INC. (OSS)
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars may not calculate due to rounding)

	For the Three Months Ended December 31,						For the Year Ended December 31,
	2024			2023			2024			2023
Revenue:
Product	$	14,280,939		$	12,335,554		$	51,003,350		$	59,200,580
Customer funded development		859,207			819,655			3,691,009			1,696,217
		15,140,146			13,155,209			54,694,358			60,896,797
Cost of revenue:
Product		10,829,859			8,229,397			42,953,344			41,907,604
Customer funded development		1,930,800			491,242			4,022,707			1,034,571
		12,760,659			8,720,639			46,976,051			42,942,175
Gross (loss) profit		2,379,487			4,434,570			7,718,307			17,954,622
Operating expenses:
General and administrative		2,413,102			1,970,746			8,971,909			9,264,447
Impairment of goodwill		–			–			–			5,630,788
Marketing and selling		1,821,918			1,667,765			8,005,982			6,651,516
Research and development		1,250,377			1,127,194			4,097,229			4,331,024
Total operating expenses		5,485,397			4,765,704			21,075,120			25,877,775
Loss from operations		(3,105,910	)		(331,134	)		(13,356,813	)		(7,923,153	)
Other income (expense), net:
Interest income		100,805			159,487			477,745			544,958
Interest expense		(3,206	)		(29,662	)		(74,116	)		(117,774	)
Employee retention credit (ERC)		–			418,431			–			1,716,727
Other income (expense), net		30,647			(452,886	)		45,353			(9,806	)
Total other income, net		128,246			95,370			448,982			2,134,105
Loss before income taxes		(2,977,664	)		(235,764	)		(12,907,831	)		(5,789,048	)
Provision for income taxes		157,119			41,796			726,502			927,128
Net loss	$	(3,134,783	)	$	(277,560	)	$	(13,634,333	)	$	(6,716,176	)

Net loss per share:
Basic	$	(0.15	)	$	(0.01	)	$	(0.65	)	$	(0.32	)
Diluted	$	(0.15	)	$	(0.01	)	$	(0.65	)	$	(0.32	)

Weighted average common shares outstanding:
Basic		21,120,396			20,632,300			20,953,397			20,854,777
Diluted		21,120,396			20,632,300			20,953,397			20,854,777

ONE STOP SYSTEMS, INC. (OSS)
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

	For the Twelve Months Ended December 31,
	2024			2023
Cash flows from operating activities:
Net loss	$	(13,634,333	)	$	(6,716,176	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Deferred income taxes		28,082			(95,496	)
Loss (gain) on disposal of property and equipment		354			–
Provision for bad debt		85,447			4,160
Impairment of goodwill		–			5,630,788
Warranty reserves		(79,962	)		11,846
Amortization of intangibles		–			42,154
Depreciation		1,041,837			1,035,362
Amortization of right-of-use assets		377,206			1,241,445
Inventory reserves		7,348,390			962,458
Stock-based compensation expense		1,988,125			2,345,358
Employee retention credit		–			(1,716,727	)
Changes in operating assets and liabilities:
Accounts receivable		(190,339	)		3,095,701
Inventories		658,303			(1,636,153	)
Prepaid expenses and other current assets		(238,554	)		(100,848	)
Accounts payable		926,231			(3,408,487	)
Accrued expenses and other liabilities		1,928,436			83,789
Operating lease liabilities		(347,321	)		(1,218,853	)
Net cash provided by operating activities		(108,098	)		(439,679	)

Cash flows from investing activities:
Redemption of short-term investment grade securities		4,553,535			2,342,552
Purchases of property and equipment, including capitalization of labor		(362,748	)		(821,753	)
Net cash provided by investing activities		4,190,787			1,520,799

Cash flows from financing activities:
Proceeds from exercise of stock options and warrants		237,749			62,422
Payment of payroll taxes on net issuance of employee stock options		(466,762	)		(597,856	)
Repayments on notes payable		(954,939	)		(1,352,637	)
Employee retention credit benefit		–			1,716,727
Net cash (used in) provided by financing activities		(1,183,952	)		(171,344	)

Net change in cash and cash equivalents		2,898,737			909,776
Effect of exchange rates on cash		(153,592	)		26,977
Cash and cash equivalents, beginning of period		4,048,948			3,112,196
Cash and cash equivalents, end of period	$	6,794,093		$	4,048,948

MIL-OSI: GDS Holdings Limited Reports Fourth Quarter and Full Year 2024 Results

Source: GlobeNewswire (MIL-OSI)

SHANGHAI, China, March 19, 2025 (GLOBE NEWSWIRE) — GDS Holdings Limited (“GDS Holdings”, “GDS” or the “Company”) (NASDAQ: GDS; HKEX: 9698), a leading developer and operator of high-performance data centers in China, today announced its unaudited financial results for the fourth quarter and full year ended December 31, 2024.

DayOne Data Centers Limited (“DayOne”), previously known as GDS International or GDSI, completed and closed its Series B equity raise on December 31, 2024. At closing, GDS’s equity interest in DayOne was diluted from 52.7% to 35.6%. Accordingly, GDS deconsolidated DayOne as a subsidiary and recognized DayOne as an equity investee. In the consolidated financial statements for the quarter and year ended December 31, 2024, DayOne’s operational results and cash flows have been excluded from the Company’s financial results from continuing operations and have been separately itemized under discontinued operations. Retrospective adjustments to the historical statements of operations and cash flows have also been made to provide a consistent basis of comparison for the financial results. Furthermore, retrospective adjustments were made to categorize and label DayOne’s assets and liabilities as “assets or liabilities of discontinued operations” on balance sheets for the comparative periods. Additionally, DayOne’s operating metrics have also been excluded from the Company’s operating metrics and have been separately itemized under discontinued operations.

Fourth Quarter 2024 Financial Highlights For Continuing Operations

Net revenue increased by 9.1% year-over-year (“Y-o-Y”) to RMB2,690.7 million (US$368.6 million) in the fourth quarter of 2024 (4Q2023: RMB2,465.3 million).
Net loss from continuing operations was RMB173.4 million (US$23.8 million) in the fourth quarter of 2024 (4Q2023: RMB3,074.6 million).
Adjusted EBITDA (non-GAAP) increased by 13.9% Y-o-Y to RMB1,297.7 million (US$177.8 million) in the fourth quarter of 2024 (4Q2023: RMB1,139.2 million). See “Non-GAAP Disclosure” and “Reconciliations of GAAP and non-GAAP results” elsewhere in this earnings release.
Adjusted EBITDA margin (non-GAAP) was 48.2% in the fourth quarter of 2024 (4Q2023: 46.2%).

Full Year 2024 Financial Highlights For Continuing Operations

Net revenue increased by 5.5% Y-o-Y to RMB10,322.1 million (US$1,414.1 million) in 2024 (2023: RMB9,782.4 million).
Net loss from continuing operations was RMB770.9 million (US$105.6 million) in 2024 (2023: RMB3,926.0 million).
Adjusted EBITDA (non-GAAP) increased by 3.0% Y-o-Y to RMB4,876.4 million (US$668.1 million) in 2024 (2023: RMB4,733.0 million). See “Non-GAAP Disclosure” and “Reconciliations of GAAP and non-GAAP results” elsewhere in this earnings release.
Adjusted EBITDA margin (non-GAAP) was 47.2% in 2024 (2023: 48.4%).

Fourth Quarter and Full Year 2024 Operating Highlights For Continuing Operations

Total area committed and pre-committed increased by 1.8% Y-o-Y to 629,997 sqm as of December 31, 2024 (December 31, 2023: 618,942 sqm).
Area utilized increased by 11.8% Y-o-Y to 453,094 sqm as of December 31, 2024 (December 31, 2023: 405,302 sqm).
Utilization rate for area in service was 73.8% as of December 31, 2024 (December 31, 2023: 73.9%).

“In 2024, we executed our business strategy in a disciplined way,” stated Mr. William Huang, Chairman and CEO of GDS. “We focused on backlog delivery while being selective on new commitments. At the same time, we made significant progress with our asset monetisation program with first ever data center ABS issue in China. Looking forward, we are well positioned strategically and financially to capture new business opportunities arising from AI.”

Fourth Quarter 2024 Financial Results For Continuing Operations

Net revenue in the fourth quarter of 2024 was RMB2,690.7 million (US$368.6 million), a 9.1% increase over the same period last year of RMB2,465.3 million. The Y-o-Y increase was mainly due to continued ramp-up of our data centers.

Cost of revenue in the fourth quarter of 2024 was RMB2,112.5 million (US$289.4 million), a 3.9% increase over the same period last year of RMB2,032.4 million. The Y-o-Y increase was in line with the continued growth of our business.

Gross profit was RMB578.1 million (US$79.2 million) in the fourth quarter of 2024, a 33.5% increase over the same period last year of RMB432.9 million.

Gross profit margin was 21.5% in the fourth quarter of 2024, compared with 17.6% in the same period last year. The Y-o-Y increase was mainly due to a lower level of depreciation and amortization costs as percentage of net revenue as the data centers continue to ramp up.

Adjusted Gross Profit (“Adjusted GP”) (non-GAAP) is defined as gross profit excluding depreciation and amortization, operating lease cost relating to prepaid land use rights, accretion expenses for asset retirement costs and share-based compensation expenses allocated to cost of revenue. Adjusted GP was RMB1,396.7 million (US$191.3 million) in the fourth quarter of 2024, an 11.8% increase over the same period last year of RMB1,249.3 million. See “Non-GAAP Disclosure” and “Reconciliations of GAAP and non-GAAP results” elsewhere in this earnings release.

Adjusted GP margin (non-GAAP) was 51.9% in the fourth quarter of 2024, compared with 50.7% in the same period last year. The Y-o-Y increase was mainly due to a lower level of cash cost components as percentage of net revenue.

Selling and marketing expenses, excluding share-based compensation expenses of RMB6.9 million (US$0.9 million), were RMB23.7 million (US$3.2 million) in the fourth quarter of 2024, a 4.1% decrease over the same period last year of RMB24.7 million (excluding share-based compensation of RMB9.3 million). The Y-o-Y decrease was mainly due to less marketing activities.

General and administrative expenses, excluding share-based compensation expenses of RMB55.9 million (US$7.7 million), depreciation and amortization expenses of RMB79.0 million (US$10.8 million) and operating lease cost relating to prepaid land use rights of RMB15.6 million (US$2.1 million), were RMB108.5 million (US$14.9 million) in the fourth quarter of 2024, a 3.3% increase over the same period last year of RMB105.1 million (excluding share-based compensation expenses of RMB35.8 million, depreciation and amortization expenses of RMB88.9 million and operating lease cost relating to prepaid land use rights of RMB16.6 million). The Y-o-Y increase was due to an increase in corporate activities as business continues to grow.

Research and development costs were RMB6.9 million (US$0.9 million) in the fourth quarter of 2024, compared with RMB12.8 million in the same period last year.

Impairment losses of long-lived assets was zero in the fourth quarter of 2024, compared with RMB3,013.4 million in the same period last year.

Net interest expenses for the fourth quarter of 2024 were RMB458.7 million (US$62.8 million), a 1.8% increase over the same period last year of RMB450.7 million. The Y-o-Y increase was mainly due to a higher level of total borrowings.

Foreign currency exchange gain for the fourth quarter of 2024 was RMB8.1 million (US$1.1 million), compared with a loss of RMB6.0 million in the same period last year.

Others, net for the fourth quarter of 2024 was RMB29.7 million (US$4.1 million), compared with RMB30.3 million in the same period last year.

Income tax expenses for the fourth quarter of 2024 were RMB34.1 million (US$4.7 million), compared with income tax benefits of RMB225.3 million in the same period last year.

Net loss from continuing operations in the fourth quarter of 2024 was RMB173.4 million (US$23.8 million), compared with RMB3,074.6 million in the same period last year.

Adjusted EBITDA (non-GAAP) is defined as net income (loss) excluding income (loss) from discontinued operations, net interest expenses, income tax expenses (benefits), depreciation and amortization, operating lease cost relating to prepaid land use rights, accretion expenses for asset retirement costs, share-based compensation expenses, gain from purchase price adjustment and impairment losses of long-lived assets. Adjusted EBITDA was RMB1,297.7 million (US$177.8 million) in the fourth quarter of 2024, a 13.9% increase over the same period last year of RMB1,139.2 million.

Adjusted EBITDA margin (non-GAAP) was 48.2% in the fourth quarter of 2024, compared with 46.2% in the same period last year. The Y-o-Y increase was mainly due to a lower level of cash cost components as percentage of net revenue and a decrease in corporate expenses as percentage of net revenue.

Full Year 2024 Financial Results For Continuing Operations

Net revenue in 2024 was RMB10,322.1 million (US$1,414.1 million), a 5.5% increase from RMB9,782.4 million in 2023, or a 6.3% increase excluding previously disclosed one-time items in 2023.

Cost of revenue in 2024 was RMB8,099.4 million (US$1,109.6 million), a 3.4% increase from RMB7,831.2 million in 2023.

Gross profit was RMB2,222.6 million (US$304.5 million) in 2024, a 13.9% increase from RMB1,951.2 million in 2023. Gross profit margin was 21.5% in 2024, compared with 19.9% in 2023.

Selling and marketing expenses, excluding share-based compensation expenses of RMB25.0 million (US$3.4 million), were RMB91.4 million (US$12.5 million) in 2024, a 5.9% decrease from RMB97.1 million (excluding share-based compensation of RMB43.8 million) in 2023.

General and administrative expenses, excluding share-based compensation expenses of RMB165.6 million (US$22.7 million), depreciation and amortization expenses of RMB291.7 million (US$40.0 million) and operating lease cost relating to prepaid land use rights of RMB65.3 million (US$8.9 million), were RMB395.3 million (US$54.2 million) in 2024, a 13.9% increase from RMB347.1 million (excluding share-based compensation expenses of RMB162.9 million, depreciation and amortization expenses of RMB387.8 million and operating lease cost relating to prepaid land use rights of RMB68.2 million) in 2023.

Research and development costs were RMB36.3 million (US$5.0 million) in 2024, compared with RMB38.2 million in 2023.

Impairment losses of long-lived assets was zero in 2024, compared with RMB3,013.4 million in 2023.

Net interest expenses were RMB1,834.9 million (US$251.4 million) in 2024, a 0.4% decrease from RMB1,842.5 million in 2023.

Others, net was RMB49.1 million (US$6.7 million) in 2024, compared with RMB109.7 million in 2023.

Net loss from continuing operations was RMB770.9 million (US$105.6 million) in 2024, compared with RMB3,926.0 million in 2023.

Adjusted EBITDA (non-GAAP) was RMB4,876.4 million (US$668.1 million) in 2024, a 3.0% increase from RMB4,733.0 million in 2023, or a 5.1% increase excluding previously disclosed one-time items in 2023.

Adjusted EBITDA margin (non-GAAP) was 47.2% in 2024, compared with 48.4% in 2023, or 47.8% excluding previously disclosed one-time items in 2023.

Fourth Quarter and Full Year 2024 Financial Results for Discontinued Operations

Net revenue was RMB443.4 million (US$60.7 million) in the fourth quarter of 2024, a 331.1% increase from RMB102.9 million in the same period last year. For the full year 2024, net revenue was RMB1,262.1 million (US$172.9 million), a 618.2% increase from RMB175.7 million in 2023.

Loss from operations of discontinued operations, net of income taxes in the fourth quarter of 2024 was RMB190.5 million (US$26.1 million), compared with RMB90.0 million in the same period last year. Loss from operations of discontinued operations, net of income taxes in 2024 was RMB400.8 million (US$54.9 million), compared with RMB359.4 million in 2023.

Adjusted EBITDA (non-GAAP) for discontinued operations is defined as loss from operations of discontinued operations, net of income taxes excluding net interest expenses, income tax expenses (benefits), depreciation and amortization, operating lease cost relating to prepaid land use rights and accretion expenses for asset retirement costs. Adjusted EBITDA (non-GAAP) was RMB109.7 million (US$15.0 million) in the fourth quarter of 2024, compared with RMB3.8 million in the same period last year. For the full year 2024, Adjusted EBITDA (non-GAAP) was RMB332.3 million (US$45.5 million), compared with negative RMB98.5 million in 2023.

Adjusted EBITDA margin (non-GAAP) was 24.7% in the fourth quarter of 2024, compared with 3.7% in the same period last year. For the full year 2024, adjusted EBITDA margin (non-GAAP) was 26.3% compared with negative 56.1% in 2023.

Gain on Deconsolidation of Subsidiaries

Gain on deconsolidation of subsidiaries in the fourth quarter of 2024 and full year of 2024 was RMB4,475.5 million (US$613.1 million), arising from the difference between the aggregate of the fair value of retained non-controlling equity interest and the carrying amount of equity interest owned by other investors in former subsidiaries at the date of deconsolidation, and the carrying amount of the deconsolidated subsidiaries’ assets and liabilities.

Net Income

Net income in the fourth quarter of 2024 was RMB4,111.6 million (US$563.3 million), compared with a net loss of RMB3,164.6 million in the same period last year.

Net income was RMB3,303.8 million (US$452.6 million) in 2024, compared with a net loss of RMB4,285.4 million in 2023.

Basic and diluted income per ordinary share in the fourth quarter of 2024 was RMB2.81 (US$0.39), compared with loss of RMB2.16 in the same period last year.

Basic and diluted income per American Depositary Share (“ADS”) in the fourth quarter of 2024 was RMB22.51 (US$3.08), compared with loss of RMB17.30 in the same period last year.

Basic and diluted income per ordinary share was RMB2.29 (US$0.31) in 2024, compared with loss of RMB2.96 in 2023.

Basic and diluted income per ADS was RMB18.28 (US$2.50) in 2024, compared with loss of RMB23.67 in 2023.

Liquidity for GDS Excluding DayOne

GDS deconsolidated DayOne as a subsidiary on December 31, 2024. As a result, the following financial information excludes DayOne’s assets and liabilities.

As of December 31, 2024, cash was RMB7,867.7 million (US$1,077.9 million).

Total short-term debt was RMB4,978.4 million (US$682.0 million), comprised of short-term borrowings and the current portion of long-term borrowings of RMB4,341.6 million (US$594.8 million), the current portion of convertible bonds payable of RMB575 thousand (US$79 thousand) and the current portion of finance lease and other financing obligations of RMB636.2 million (US$87.2 million). Total long-term debt was RMB38,084.2 million (US$5,217.5 million), comprised of long-term borrowings (excluding current portion) of RMB21,906.0 million (US$3,001.1 million), the non-current portion of convertible bonds payable of RMB8,576.6 million (US$1,175.0 million) and the non-current portion of finance lease and other financing obligations of RMB7,601.7 million (US$1,041.4 million).

During the fourth quarter of 2024, the Company obtained new debt financing and refinancing facilities of RMB960.0 million (US$131.5 million) for continuing operations.

During the full year of 2024, the Company obtained new debt financing and refinancing facilities of RMB5,734.0 million (US$785.5 million) for continuing operations.

Liquidity For DayOne

As of December 31, 2024, upon deconsolidation, cash was RMB9,930.9 million (US$1,360.5 million). Total gross debt, including borrowings and finance lease and other financing obligations, was RMB10,417.6 million (US$1,427.2 million).

Fourth Quarter and Full Year 2024 Operating Results For Continuing Operations

Sales

Total area committed and pre-committed at the end of the fourth quarter of 2024 was 629,997 sqm, compared with 618,942 sqm at the end of the fourth quarter of 2023 and 626,783 sqm at the end of the third quarter of 2024, an increase of 1.8% Y-o-Y and 0.5% quarter-over-quarter (“Q-o-Q”), respectively. In the fourth quarter of 2024, gross additional total area committed was 9,387 sqm, mainly contributed by data centers in Shanghai. Net additional total area committed was 3,214 sqm. In the full year of 2024, gross additional total area committed was 49,452 sqm, and net additional total area committed was 11,055 sqm.

Data Center Resources

Area in service at the end of the fourth quarter of 2024 was 613,583 sqm, compared with 548,352 sqm at the end of the fourth quarter of 2023 and 595,606 sqm at the end of the third quarter of 2024, an increase of 11.9% Y-o-Y and 3.0% Q-o-Q. In the fourth quarter of 2024, net additional area in service for China was 17,977 sqm, mainly from data centers in Changshu, Langfang and Huizhou.

Area under construction at the end of the fourth quarter of 2024 was 102,691 sqm, compared with 151,602 sqm at the end of the fourth quarter of 2023 and 120,422 sqm at the end of the third quarter of 2024, a decrease of 32.3% Y-o-Y and 14.7% Q-o-Q, respectively.

Commitment rate for area in service was 91.9% at the end of the fourth quarter of 2024, compared with 92.5% at the end of the fourth quarter of 2023 and 92.1% at the end of the third quarter of 2024. Pre-commitment rate for area under construction was 64.1% at the end of the fourth quarter of 2024, compared with 73.8% at the end of the fourth quarter of 2023 and 65.1% at the end of the third quarter of 2024.

Move-In

Area utilized at the end of the fourth quarter of 2024 was 453,094 sqm, compared with 405,302 sqm at the end of the fourth quarter of 2023 and 438,654 sqm at the end of the third quarter of 2024, an increase of 11.8% Y-o-Y and 3.3% Q-o-Q. In the fourth quarter of 2024, gross additional area utilized was 16,390 sqm, mainly contributed by data centers in Langfang, Huizhou and Shanghai. Net additional area utilized was 14,440 sqm. In the full year of 2024, gross additional area utilized was 79,431 sqm, and net additional area utilized was 47,792 sqm.

Utilization rate for area in service was 73.8% at the end of the fourth quarter of 2024, compared with 73.9% at the end of the fourth quarter of 2023 and 73.6% at the end of the third quarter of 2024.

Fourth Quarter and Full Year 2024 Operating Results for Discontinued Operations

Total power committed was 469 MW as of December 31, 2024, an increase from 433 MW as of September 30, 2024. The contribution was mainly from the two sites in Johor, Malaysia.

Power Capacity in Service was 132 MW as of December 31, 2024, compared to 131 MW as of September 30, 2024. Power Capacity Under Construction was 369 MW as of December 31, 2024, an increase from 320 MW as of September 30, 2024. This increase was primarily driven by the progress of two new data centers under construction in Johor sites.

Power utilized was 123 MW as of December 31, 2024, an increase from 105 MW as of September 30, 2024. Utilization Rate was 93.6% as of December 31, 2024.

Recent Development

Reference is made to the Company’s press release on March 10, 2025 where it announced that it has entered into definitive agreements to monetize, on a net basis, a 70% equity interest in certain of its data centers, at an implied enterprise value (“EV”) to EBITDA multiple of around 13 times. In such transaction, GDS is selling a 100% equity interest in certain data center project companies to a purchaser which is special purpose vehicle involving the issue of an Asset Backed Security (“ABS”). The ABS is 70% subscribed by top tier institutional investors in China, led by China Life Insurance Company Limited (“China Life”), whilst GDS subscribes for the remaining 30% and retains the rights for on-going operation of the underlying data centers. The ABS will be registered on the Shanghai Stock Exchange as a privately-held standardized security product. The ABS is specifically designed to facilitate an eventual injection into a public REIT vehicle (commonly referred to as “C-REIT”) for public offering and listing in the future, when certain qualification requirements under the ABS scheme are satisfied. Notwithstanding the above, such potential injection remains subject to, among other things, the satisfaction of relevant regulatory and disclosure requirements (including but not limited to the Hong Kong Listing Rules requirement on spin-off listing) and there is currently no concrete or definitive plan in this regard.

Business Outlook For Continuing Operations

For the full year of 2025, the Company expects its total revenues to be between RMB11,290 million to RMB11,590 million, implying a year-on-year increase of between approximately 9.4% to 12.3%; and its Adjusted EBITDA to be between RMB5,190 million to RMB5,390 million, implying a year-on-year increase of between approximately 6.4% to 10.5%. In addition, the Company expects capex to be around RMB4,300 million for the full year of 2025.

This forecast assumes completion of the ABS transaction and deconsolidation of the underlying data center project companies. However, the gain on sale is not included in Adjusted EBITDA.

This forecast reflects the Company’s preliminary view on the current business situation and market conditions, which are subject to change.

Conference Call

Management will hold a conference call at 8:00 a.m. U.S. Eastern Time on March 19, 2025 (8:00 p.m. Beijing Time on March 19, 2025) to discuss financial results and answer questions from investors and analysts.

Participants should complete online registration using the link provided below at least 15 minutes before the scheduled start time. Upon registration, participants will receive the conference call access information, including dial-in numbers, a personal PIN and an e-mail with detailed instructions to join the conference call.

Participant Online Registration:
https://register-conf.media-server.com/register/BI4cc739e1f3c748ffa22f7df4125e5079

A live and archived webcast of the conference call will be available on the Company’s investor relations website at investors.gds-services.com.

Non-GAAP Disclosure

Our management and board of directors use Adjusted EBITDA, Adjusted EBITDA margin, Adjusted GP and Adjusted GP margin, which are non-GAAP financial measures, to evaluate our operating performance, establish budgets and develop operational goals for managing our business. We believe that the exclusion of the income and expenses eliminated in calculating Adjusted EBITDA and Adjusted GP can provide useful and supplemental measures of our core operating performance. In particular, we believe that the use of Adjusted EBITDA as a supplemental performance measure captures the trend in our operating performance by excluding from our operating results the impact of our capital structure (primarily interest expense), asset base charges (primarily depreciation and amortization, operating lease cost relating to prepaid land use rights, accretion expenses for asset retirement costs and impairment losses of long-lived assets), other non-cash expenses (primarily share-based compensation expenses), and other income and expenses which we believe are not reflective of our operating performance, whereas the use of adjusted gross profit as a supplemental performance measure captures the trend in gross profit performance of our data centers in service by excluding from our gross profit the impact of asset base charges (primarily depreciation and amortization, operating lease cost relating to prepaid land use rights and accretion expenses for asset retirement costs) and other non-cash expenses (primarily share-based compensation expenses) included in cost of revenue. In addition, we exclude the income (loss) from discontinued operation from our Adjusted EBITDA and Adjusted EBITDA margin to measure our financial performance from continuing operations, which will be consistent with our future financial performance disclosure.

We note that depreciation and amortization is a fixed cost which commences as soon as each data center enters service. However, it usually takes several years for new data centers to reach high levels of utilization and profitability. The Company incurs significant depreciation and amortization costs for its early stage data center assets. Accordingly, gross profit, which is a measure of profitability after taking into account depreciation and amortization, does not accurately reflect the Company’s core operating performance.

We also present these non-GAAP measures because we believe these non-GAAP measures are frequently used by securities analysts, investors and other interested parties as measures of the financial performance of companies in our industry.

These non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. These non-GAAP financial measures have limitations as analytical tools, and when assessing our operating performance, cash flows or our liquidity, investors should not consider them in isolation, or as a substitute for gross profit, net income (loss), cash flows provided by (used in) operating activities or other consolidated statements of operations and cash flow data prepared in accordance with U.S. GAAP. There are a number of limitations related to the use of these non-GAAP financial measures instead of their nearest GAAP equivalent. First, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted GP, and Adjusted GP margin are not substitutes for gross profit, net income (loss), cash flows provided by (used in) operating activities or other consolidated statements of operation and cash flow data prepared in accordance with U.S. GAAP. Second, other companies may calculate these non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of these non-GAAP financial measures as tools for comparison. Finally, these non-GAAP financial measures do not reflect the impact of income (loss) from discontinued operations, net interest expenses, incomes tax benefits (expenses), depreciation and amortization, operating lease cost relating to prepaid land use rights, accretion expenses for asset retirement costs, share-based compensation expenses, gain from purchase price adjustment and impairment losses of long-lived assets, each of which have been and may continue to be incurred in our business.

We mitigate these limitations by reconciling the non-GAAP financial measure to the most comparable U.S. GAAP performance measure, all of which should be considered when evaluating our performance. We do not provide forward-looking guidance for certain financial data, such as depreciation, amortization, accretion, share-based compensation and net income (loss); the impact of such data and related adjustments can be significant. As a result, we are not able to provide a reconciliation of forward-looking U.S. GAAP to forward-looking non-GAAP financial measures without unreasonable effort. Such forward-looking non-GAAP financial measures include the forecast for Adjusted EBITDA in the section captioned “Business Outlook For Continuing Operations” set forth in this press release.

For more information on these non-GAAP financial measures, please see the table captioned “Reconciliations of GAAP and non-GAAP results” set forth at the end of this press release.

Exchange Rate

This announcement contains translations of certain RMB amounts into U.S. dollars (“USD”) at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to USD were made at the rate of RMB7.2993 to US$1.00, the noon buying rate in effect on December 31, 2024 in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or USD amounts referred could be converted into USD or RMB, as the case may be, at any particular rate or at all.

Statement Regarding Preliminary Unaudited Financial Information

The unaudited financial information set out in this earnings release is preliminary and subject to potential adjustments. Adjustments to the consolidated financial statements may be identified when audit work has been performed for the Company’s year-end audit, which could result in significant differences from this preliminary unaudited financial information.

About GDS Holdings Limited

GDS Holdings Limited (NASDAQ: GDS; HKEX: 9698) is a leading developer and operator of high-performance data centers in China. The Company’s facilities are strategically located in and around primary economic hubs where demand for high-performance data center services is concentrated. The Company’s data centers have large net floor area, high power capacity, density and efficiency, and multiple redundancies across all critical systems. GDS is carrier and cloud-neutral, which enables its customers to access the major telecommunications networks, as well as the largest PRC and global public clouds, which are hosted in many of its facilities. The Company offers co-location and a suite of value-added services, including managed hybrid cloud services through direct private connection to leading public clouds, managed network services, and, where required, the resale of public cloud services. The Company has a 24-year track record of service delivery, successfully fulfilling the requirements of some of the largest and most demanding customers for outsourced data center services in China. The Company’s customer base consists predominantly of hyperscale cloud service providers, large internet companies, financial institutions, telecommunications carriers, IT service providers, and large domestic private sector and multinational corporations. The Company also holds a non-controlling 35.6% equity interest in DayOne Data Centers Limited which develops and operates data centers in International markets.

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “aim,” “anticipate,” “believe,” “continue,” “estimate,” “expect,” “future,” “guidance,” “intend,” “is/are likely to,” “may,” “ongoing,” “plan,” “potential,” “target,” “will,” and similar statements. Among other things, statements that are not historical facts, including statements about GDS Holdings’ beliefs and expectations regarding the growth of its businesses and its revenue for the full fiscal year, the business outlook and quotations from management in this announcement, as well as GDS Holdings’ strategic and operational plans, are or contain forward-looking statements. GDS Holdings may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”) on Forms 20-F and 6-K, in its current, interim and annual reports to shareholders, in announcements, circulars or other publications made on the website of the Stock Exchange of Hong Kong Limited (the “Hong Kong Stock Exchange”), in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause GDS Holdings’ actual results or financial performance to differ materially from those contained in any forward-looking statement, including but not limited to the following: GDS Holdings’ goals and strategies; GDS Holdings’ future business development, financial condition and results of operations; the expected growth of the market for high-performance data centers, data center solutions and related services in China and regions in which GDS’ major equity investees operate, such as South East Asia; GDS Holdings’ expectations regarding demand for and market acceptance of its high-performance data centers, data center solutions and related services; GDS Holdings’ expectations regarding building, strengthening and maintaining its relationships with new and existing customers; the results of operations, growth prospects, financial condition, regulatory environment, competitive landscape and other uncertainties associated with the business and operations of our significant equity investee DayOne; the continued adoption of cloud computing and cloud service providers in China and other major markets that may impact the results of our equity investees, such as South East Asia; risks and uncertainties associated with increased investments in GDS Holdings’ business and new data center initiatives; risks and uncertainties associated with strategic acquisitions and investments; GDS Holdings’ ability to maintain or grow its revenue or business; fluctuations in GDS Holdings’ operating results; changes in laws, regulations and regulatory environment that affect GDS Holdings’ business operations and those of its major equity investees; competition in GDS Holdings’ industry in China and in markets that affect the business of our major equity investees, such as South East Asia; security breaches; power outages; and fluctuations in general economic and business conditions in China and globally, and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks, uncertainties or factors is included in GDS Holdings’ filings with the SEC, including its annual report on Form 20-F, and with the Hong Kong Stock Exchange. All information provided in this press release is as of the date of this press release and are based on assumptions that GDS Holdings believes to be reasonable as of such date, and GDS Holdings does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

For investor and media inquiries, please contact:

GDS Holdings Limited
Laura Chen
Phone: +86 (21) 2029-2203
Email: ir@gds-services.com

Piacente Financial Communications
Ross Warner
Phone: +86 (10) 6508-0677
Email: GDS@tpg-ir.com

Brandi Piacente
Phone: +1 (212) 481-2050
Email: GDS@tpg-ir.com

GDS Holdings Limited

GDS HOLDINGS LIMITED UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”))

		As of December 31, 2023		As of December 31, 2024
		RMB		RMB		US$

	Assets
Current assets
	Cash	7,354,809		7,867,659		1,077,865
	Accounts receivable, net of allowance for credit losses	2,493,059		3,021,956		414,006
	Value-added-tax (“VAT”) recoverable	214,385		240,506		32,949
	Prepaid expenses and other current assets	483,833		482,950		66,164
	Current assets of discontinued operations	437,567		0		0
	Total current assets	10,983,653		11,613,071		1,590,984

Non-current assets
	Long-term investments in equity investees	7,298		7,544,555		1,033,600
	Property and equipment, net	40,098,423		40,204,133		5,507,944
	Prepaid land use rights, net	22,388		21,774		2,983
	Operating lease right-of-use assets	5,310,723		5,193,408		711,494
	Goodwill and intangible assets, net	6,574,669		6,367,493		872,343
	Other non-current assets	2,538,542		2,704,194		370,473
	Non-current assets of discontinued operations	8,910,994		0		0
	Total non-current assets	63,463,037		62,035,557		8,498,837
	Total assets	74,446,690		73,648,628		10,089,821

	Liabilities, Mezzanine Equity and Equity
Current liabilities
	Short-term borrowings and current portion of long-term borrowings	2,582,350		4,341,649		594,803
	Convertible bonds payable, current	0		575		79
	Accounts payable	2,749,896		2,593,305		355,281
	Accrued expenses and other payables	1,265,259		1,389,072		190,302
	Operating lease liabilities, current	132,811		117,345		16,076
	Finance lease and other financing obligations, current	547,847		636,152		87,152
	Current liabilities of discontinued operations	1,027,313		0		0
	Total current liabilities	8,305,476		9,078,098		1,243,693

Non-current liabilities
	Long-term borrowings, excluding current portion	23,088,055		21,905,985		3,001,108
	Convertible bonds payable, non-current	8,434,766		8,576,583		1,174,987
	Operating lease liabilities, non-current	1,344,264		1,279,726		175,322
	Finance lease and other financing obligations, non-current	7,894,185		7,601,651		1,041,422
	Other long-term liabilities	1,586,012		1,537,952		210,699
	Non-current liabilities of discontinued operations	3,670,129		0		0
	Total non-current liabilities	46,017,411		40,901,897		5,603,538
	Total liabilities	54,322,887		49,979,995		6,847,231

Mezzanine equity
	Redeemable preferred shares	1,064,766		1,080,656		148,049
	Total mezzanine equity	1,064,766		1,080,656		148,049

GDS Holdings Limited shareholders’ equity
	Ordinary shares	516		527		72
	Additional paid-in capital	29,337,095		29,596,268		4,054,672
	Accumulated other comprehensive loss	(974,393	)	(1,094,377	)	(149,929	)
	Accumulated deficit	(9,469,758	)	(6,044,372	)	(828,075	)
	Total GDS Holdings Limited shareholders’ equity	18,893,460		22,458,046		3,076,740
Non-controlling interests		165,577		129,931		17,801
	Total equity	19,059,037		22,587,977		3,094,541

	Total liabilities, mezzanine equity and equity	74,446,690		73,648,628		10,089,821

GDS HOLDINGS LIMITED UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”) except for number of shares and per share data)

		Three months ended								Year ended
		December 31, 2023		September 30, 2024		December 31, 2024					December 31, 2023		December 31, 2024
		RMB		RMB		RMB		US$			RMB		RMB		US$

Net revenue
Service revenue		2,465,283		2,619,578		2,690,482		368,595			9,781,884		10,321,888		1,414,093
Equipment sales		0		0		180		25			564		180		25
Total net revenue		2,465,283		2,619,578		2,690,662		368,620			9,782,448		10,322,068		1,414,118
Cost of revenue		(2,032,352	)	(2,061,995	)	(2,112,545	)	(289,417	)		(7,831,222	)	(8,099,439	)	(1,109,619	)
Gross profit		432,931		557,583		578,117		79,203			1,951,226		2,222,629		304,499

Operating expenses
	Selling and marketing expenses	(34,050	)	(32,356	)	(30,571	)	(4,188	)		(140,890	)	(116,440	)	(15,952	)
	General and administrative expenses	(246,274	)	(211,392	)	(259,048	)	(35,490	)		(965,982	)	(917,877	)	(125,748	)
	Research and development expenses	(12,800	)	(8,588	)	(6,862	)	(940	)		(38,159	)	(36,319	)	(4,976	)
	Impairment losses of long-lived assets	(3,013,416	)	0		0		0			(3,013,416	)	0		0
(Loss) income from continuing operations		(2,873,609	)	305,247		281,636		38,585			(2,207,221	)	1,151,993		157,823
Other income (expenses):
	Net interest expenses	(450,700	)	(463,327	)	(458,745	)	(62,848	)		(1,842,529	)	(1,834,851	)	(251,374	)
	Foreign currency exchange (loss) gain, net	(5,991	)	586		8,117		1,112			(1,573	)	18,942		2,595
	Others, net	30,347		5,001		29,727		4,072			109,729		49,057		6,721
Loss from continuing operations before income taxes		(3,299,953	)	(152,493	)	(139,265	)	(19,079	)		(3,941,594	)	(614,859	)	(84,235	)
Income tax benefits (expenses)		225,342		347		(34,144	)	(4,678	)		15,577		(156,053	)	(21,379	)
Net loss from continuing operations		(3,074,611	)	(152,146	)	(173,409	)	(23,757	)		(3,926,017	)	(770,912	)	(105,614	)

Discontinued operations
	Loss from operations of discontinued operations, net of income taxes	(90,033	)	(78,963	)	(190,491	)	(26,097	)		(359,376	)	(400,796	)	(54,909	)
	Gain on deconsolidation of subsidiaries	0		0		4,475,539		613,146			0		4,475,539		613,146
(Loss) income from discontinued operations		(90,033	)	(78,963	)	4,285,048		587,049			(359,376	)	4,074,743		558,237

Net (loss) income		(3,164,644	)	(231,109	)	4,111,639		563,292			(4,285,393	)	3,303,831		452,623

Net loss from continuing operations		(3,074,611	)	(152,146	)	(173,409	)	(23,757	)		(3,926,017	)	(770,912	)	(105,614	)
Net income from continuing operations attributable to non-controlling interests		(1,676	)	(1,755	)	(1,268	)	(174	)		(5,026	)	(6,209	)	(851	)
Net loss from continuing operations attributable to GDS Holdings Limited shareholders		(3,076,287	)	(153,901	)	(174,677	)	(23,931	)		(3,931,043	)	(777,121	)	(106,465	)

(Loss) income from discontinued operations		(90,033	)	(78,963	)	4,285,048		587,049			(359,376	)	4,074,743		558,237
Net loss from discontinued operations attributable to non-controlling interests		366		5,092		3,373		462			366		7,317		1,003
Net loss from discontinued operations attributable to redeemable non-controlling interests		0		35,432		75,550		10,350			0		120,447		16,501
Net (loss) income from discontinued operations attributable to GDS Holdings Limited shareholders		(89,667	)	(38,439	)	4,363,971		597,861			(359,010	)	4,202,507		575,741

Net (loss) income attributable to GDS Holdings Limited shareholders		(3,165,954	)	(192,340	)	4,189,294		573,930			(4,290,053	)	3,425,386		469,276
Cumulative dividend on redeemable preferred shares		(13,679	)	(13,618	)	(13,679	)	(1,874	)		(53,625	)	(54,232	)	(7,430	)
Net (loss) income available to GDS Holdings Limited ordinary shareholders		(3,179,633	)	(205,958	)	4,175,615		572,056			(4,343,678	)	3,371,154		461,846

(Loss) income per ordinary share
Basic and diluted		(2.16	)	(0.14	)	2.81		0.39			(2.96	)	2.29		0.31

Weighted average number of ordinary share outstanding
Basic and diluted		1,469,982,015		1,476,130,132		1,484,083,188		1,484,083,188			1,468,187,956		1,475,079,754		1,475,079,754

GDS HOLDINGS LIMITED UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME (Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”))

	Three months ended								Year ended
	December 31, 2023		September 30, 2024		December 31, 2024				December 31, 2023		December 31, 2024
	RMB		RMB		RMB		US$		RMB		RMB		US$

Net (loss) income	(3,164,644	)	(231,109	)	4,111,639		563,292		(4,285,393	)	3,303,831		452,623
Foreign currency translation adjustments, net of nil tax	117,674		538,739		(391,639	)	(53,654	)	(125,118	)	74,741		10,239
Defined benefit plan, net of nil tax	0		0		(41	)	(6	)	0		(41	)	(6	)
Amounts reclassified from accumulated other comprehensive loss	0		0		(96,957	)	(13,283	)	0		(96,957	)	(13,283	)
Comprehensive (loss) income	(3,046,970	)	307,630		3,623,002		496,349		(4,410,511	)	3,281,574		449,573
Comprehensive (income) loss attributable to non-controlling interests	(1,678	)	(5,287	)	6,631		908		(5,575	)	(1,076	)	(147	)
Comprehensive (income) loss attributable to redeemable non-controlling interests	0		(107,365	)	126,721		17,361		0		24,904		3,412
Comprehensive (loss) income attributable to GDS Holdings Limited shareholders	(3,048,648	)	194,978		3,756,354		514,618		(4,416,086	)	3,305,402		452,838

GDS HOLDINGS LIMITED UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”))

	Three months ended								Year ended
	December 31, 2023		September 30, 2024		December 31, 2024				December 31, 2023		December 31, 2024
	RMB		RMB		RMB		US$		RMB		RMB		US$

Net (loss) income	(3,164,644	)	(231,109	)	4,111,639		563,292		(4,285,393	)	3,303,831		452,623
Net loss (income) from discontinued operations	90,033		78,963		(4,285,048	)	(587,049	)	359,376		(4,074,743	)	(558,237	)
Depreciation and amortization	865,485		803,535		865,896		118,627		3,368,474		3,243,004		444,290
Amortization of debt issuance cost and debt discount	34,010		33,467		18,290		2,506		140,625		110,724		15,169
Share-based compensation expense	80,765		61,194		82,965		11,366		336,616		296,487		40,619
Impairment losses of long-lived assets	3,013,416		0		0		0		3,013,416		0		0
Others	(202,637	)	(63,810	)	(29,703	)	(4,069	)	(187,844	)	(115,941	)	(15,884	)
Changes in operating assets and liabilities	326,171		(42,362	)	315,821		43,267		(385,994	)	(543,700	)	(74,487	)
Net cash provided by operating activities from continuing operations	1,042,599		639,878		1,079,860		147,940		2,359,276		2,219,662		304,093
Net cash (used in) provided by operating activities from discontinued operations	(93,209	)	1,636		(150,554	)	(20,626	)	(294,019	)	(281,297	)	(38,538	)
Net cash provided by operating activities	949,390		641,514		929,306		127,314		2,065,257		1,938,365		265,555

Purchase of property and equipment and land use rights	(282,591	)	(788,123	)	(381,382	)	(52,249	)	(3,175,406	)	(2,965,384	)	(406,256	)
(Payments) receipts related to acquisitions and investments	(396,051	)	0		27,000		3,699		(1,339,639	)	1,125,023		154,128
Net cash used in investing activities from continuing operations	(678,642	)	(788,123	)	(354,382	)	(48,550	)	(4,515,045	)	(1,840,361	)	(252,128	)
Net cash used in investing activities from discontinued operations	(784,990	)	(2,110,682	)	(3,011,040	)	(412,511	)	(2,827,863	)	(6,920,177	)	(948,060	)
Net cash used in investing activities	(1,463,632	)	(2,898,805	)	(3,365,422	)	(461,061	)	(7,342,908	)	(8,760,538	)	(1,200,188	)

Net cash (used in) provided by financing activities from continuing operations	(271,778	)	(392,325	)	(612,447	)	(83,905	)	1,266,936		174,295		23,878
Net cash provided by financing activities from discontinued operations	958,799		2,334,112		11,441,448		1,567,472		2,892,824		16,883,042		2,312,967
Net cash provided by financing activities	687,021		1,941,787		10,829,001		1,483,567		4,159,760		17,057,337		2,336,845
Effect of exchange rate changes on cash and restricted cash	4,705		(28,109	)	(6,457	)	(885	)	154,302		(13,592	)	(1,862	)

Net increase (decrease) of cash and restricted cash	177,484		(343,613	)	8,386,428		1,148,935		(963,589	)	10,221,572		1,400,350
Cash and restricted cash at beginning of period	7,740,395		10,096,689		9,753,076		1,336,166		8,882,066		7,917,932		1,084,752
Reclassification as assets of disposal group classified as held for sale	53		0		0		0		(545	)	0		0
Cash and restricted cash at end of period	7,917,932		9,753,076		18,139,504		2,485,101		7,917,932		18,139,504		2,485,102
Less: Cash and restricted cash of discontinued operations at end of period or deconsolidation date	(420,610	)	(1,760,719	)	(10,045,974	)	(1,376,293	)	(420,610	)	(10,045,974	)	(1,376,293	)
Cash and restricted cash of continuing operations at end of period	7,497,322		7,992,357		8,093,530		1,108,808		7,497,322		8,093,530		1,108,809

GDS HOLDINGS LIMITED
RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS
(Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”)
except for percentage data)

Three months ended

Year ended

December 31,
2023

September 30,
2024

December 31, 2024

December 31, 2023

December 31, 2024

RMB

US$

RMB

US$

Gross profit

432,931

557,583

578,117

79,203

1,951,226

2,222,629

304,499

Depreciation and amortization

775,122

731,630

786,869

107,801

2,974,546

2,947,444

403,798

Operating lease cost relating to prepaid land use rights

10,615

11,536

11,996

1,643

38,792

44,872

6,147

Accretion expenses for asset retirement costs

1,588

1,730

1,709

234

6,599

6,827

935

Share-based compensation expenses

29,066

20,549

18,002

2,466

116,467

92,402

12,659

Adjusted GP

1,249,322

1,323,028

1,396,693

191,347

5,087,630

5,314,174

728,038

Adjusted GP margin

50.7%

50.5%

51.9%

52.0%

51.5%

GDS HOLDINGS LIMITED RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS (Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”) except for percentage data)

	Three months ended								Year ended
	December 31, 2023		September 30, 2024		December 31, 2024				December 31, 2023		December 31, 2024
	RMB		RMB		RMB		US$		RMB		RMB		US$

Net (loss) income	(3,164,644	)	(231,109	)	4,111,639		563,292		(4,285,393	)	3,303,831		452,623
Loss (income) from discontinued operations	90,033		78,963		(4,285,048	)	(587,049	)	359,376		(4,074,743	)	(558,237	)
Net loss from continuing operations	(3,074,611	)	(152,146	)	(173,409	)	(23,757	)	(3,926,017	)	(770,912	)	(105,614	)
Net interest expenses	450,700		463,327		458,745		62,848		1,842,529		1,834,851		251,374
Income tax (benefits) expenses	(225,342	)	(347	)	34,144		4,678		(15,577	)	156,053		21,379
Depreciation and amortization	865,485		803,535		865,896		118,627		3,368,474		3,243,004		444,290
Operating lease cost relating to prepaid land use rights	27,199		27,602		27,609		3,782		106,964		110,126		15,087
Accretion expenses for asset retirement costs	1,588		1,730		1,709		234		6,599		6,827		935
Share-based compensation expenses	80,765		61,194		82,965		11,366		336,616		296,487		40,619
Impairment losses of long-lived assets	3,013,416		0		0		0		3,013,416		0		0
Adjusted EBITDA	1,139,200		1,204,895		1,297,659		177,778		4,733,004		4,876,436		668,070
Adjusted EBITDA margin	46.2%		46.0%		48.2%		48.2%		48.4%		47.2%		47.2%

Additional Information for Discontinued Operations (Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”))

	As of December 31, 2023	As of December 31, 2024
	RMB	RMB	US$
Property and equipment, net	7,401,071	16,646,191	2,280,519
Cash	355,902	9,930,915	1,360,530
Gross debt	5,169,734 ⁽¹⁾	10,417,647	1,427,212

Note:

Including amounts due to GDSH.

Additional Information for Discontinued Operations Cont’d (Amount in thousands of Renminbi (“RMB”) and US dollars (“US$”) except for percentage data)

	Three months ended				Year ended
	December 31, 2023	September 30, 2024	December 31, 2024		December 31, 2023	December 31, 2024
	RMB	RMB	RMB	US$	RMB	RMB	US$

Net revenue	102,853	363,209	443,413	60,747	175,737	1,262,063	172,902
Cost of revenue	(90,862)	(252,211)	(290,131)	(39,748)	(194,570)	(859,254)	(117,717)
Operating expenses	(66,214)	(88,776)	(150,543)	(20,624)	(233,249)	(400,336)	(54,846)
(Loss) income from operations	(54,223)	22,222	2,739	375	(252,082)	2,473	339
Other expenses, net	(35,020)	(110,846)	(126,457)	(17,324)	(106,494)	(346,145)	(47,422)
Loss from operations of discontinued operations before income taxes	(89,243)	(88,624)	(123,718)	(16,949)	(358,576)	(343,672)	(47,083)
Income tax (expenses) benefits	(790)	9,661	(66,773)	(9,148)	(800)	(57,124)	(7,826)
Loss from operations of discontinued operations, net of income taxes	(90,033)	(78,963)	(190,491)	(26,097)	(359,376)	(400,796)	(54,909)
Net interest expenses	42,060	76,069	102,991	14,110	107,286	280,652	38,449
Income tax expenses (benefits)	790	(9,661)	66,773	9,148	800	57,124	7,826
Depreciation and amortization	50,650	107,739	128,662	17,627	151,271	393,735	53,941
Operating lease cost relating to prepaid land use rights	295	0	1,778	244	1,290	1,782	244
Accretion expenses for asset retirement costs	52	0	(1)	0	206	(211)	(29)
Adjusted EBITDA	3,814	95,184	109,712	15,032	(98,523)	332,286	45,522
Adjusted EBITDA margin	3.7%	26.2%	24.7%	24.7%	(56.1)%	26.3%	26.3%

Net cash (used in) provided by operating activities	(93,209)	1,636	(150,554)	(20,626)	(294,019)	(281,297)	(38,538)
Net cash used in investing activities	(784,990)	(2,110,682)	(3,011,040)	(412,511)	(2,827,863)	(6,920,177)	(948,060)
Net cash provided by financing activities	958,799	2,334,112	11,441,448	1,567,472	2,892,824	16,883,042	2,312,967

MIL-OSI Australia: Animal cruelty: International student receives prison term for wildlife smuggling

Source: Government of Queensland

Issued: 19 Mar 2025

Open larger image

The woman attempted to smuggle 15 native lizards overseas.

An international university student studying in Australia has been convicted of multiple wildlife trafficking offences and sentenced to eighteen months in prison.

Ms Yinan Zhao appeared in the Brisbane District Court on 27 February 2025 to face seven charges of attempting to send native Australian wildlife by post to China.

Between 12 May and 1 November 2023, Zhao attempted to export ten individual packages containing 15 lizards from Queensland to China, with an estimated ‘street value’ of $74,207.

The lizards were packed in small boxes containing children’s toys with some intercepted by Australia Post in Brisbane and others in Sydney after being X-rayed.

The successful prosecution was the result of a joint operation between the Australian Government Department of Climate Change, Environment, Energy and Water (DCCEEW) and the Queensland Government Department of the Environment, Tourism, Science and Innovation (DETSI).

Much of the offending took place in Queensland, while some offences occurred in New South Wales.

DESTI Compliance Manager Warren Christensen welcomed the prosecution and the minimum five-month prison sentence.

“Unfortunately, international students, such as those from China are often targeted through social media and other means to make easy money by smuggling wildlife,” Mr Christensen said.

“This prosecution should serve as a warning to others considering smuggling animals to make a quick buck that they will be caught and face very serious, life changing consequences.

“This operation was an excellent example of state and Australian government agencies working cooperatively with Border Force and Australia Post to detect and prevent international wildlife smuggling.

“DETSI wildlife officers seized the packages suspected by Australia Post and Border Force of containing protected wildlife.

“We formally identified all wildlife recovered from the packages and assisted with the identification of Zhao and the execution of the warrant that led to her arrest.

“During her arrest, we also found more unlawfully held wildlife that were also being prepared for sale on Chinese markets.

“Sending reptiles in the mail is extremely cruel as they won’t have access to food, water or fresh air for weeks and sadly, most of the animals will die before they get to their destination.

“Of those we intercept, many can never be released into the wild because we don’t know where they were captured or if they have been exposed to disease while in captivity.

“We thank the Australian Government, Border Force and Australia Post for their efforts in assisting in detecting this crime and in securing this conviction.”

Zhao was convicted on all charges and sentenced to 18-months imprisonment with a non-parole period of 5 months.

The successful conviction follows the prosecution of another foreign national, Mr Man Lung Ma, who was convicted of nineteen charges relating to twenty-nine separate attempts to export protected native wildlife, including five attempts from Queensland.

In November 2024 Lung Ma was sentenced to 3 years 6 months in jail, with a 2-year non-parole period.

Lizards attempted to be smuggled:

5 Shinglebacks
5 Blue tongues
2 Geckos
2 Tree skinks
1 Cunningham skink

MIL OSI News –

MIL-OSI New Zealand: Another failed ETS auction, another indictment on the Govt’s climate credibility

Source: Green Party

The ETS auction’s failure today is yet another clear sign that the Government is failing us all on climate action.

“Yesterday, the acting Prime Minister admitted that the Government’s climate commitments were the bare minimum. Worse still, today’s ETS auction failure shows that even the market the Government is relying on doesn’t trust them to deliver,” says the Green Party’s co-leader and Climate Change spokesperson, Chlöe Swarbrick.

“Luxon’s Government has put almost all of their climate eggs in the basket of market mechanisms like the Emissions Trading Scheme, and left a gaping hole in the basket.

“We must take forestry offsets out of the ETS to ensure it functions properly to actually cap emissions. We must end free allocation of credits to our largest polluters. We must price agricultural emissions – the only sector currently not priced.

“He Ara Anamata, our Green Emissions Reduction Plan, showed how we can reduce emissions five times faster than the Government’s plan, while reducing the cost of living and improving people’s quality of life.

“Our plan outlines an economy that supports people and the planet, instead of exploiting and exhausting both.

“That means a Green Jobs Guarantee, planting native trees instead of pine, efficient public transport, sustainable food production, restoring our wetlands, designing our cities better, distributed and resilient renewable energy, real just transition plans led by local communities and so much more,” says Chlöe Swarbrick.

MIL OSI New Zealand News –

https://register-conf.media-server.com/register/BI6702756dbdb741f9b401c583a37bd291

MIL-OSI: LexinFintech Holdings Ltd. Reports Fourth Quarter and Full Year 2024 Unaudited Financial Results

Source: GlobeNewswire (MIL-OSI)

SHENZHEN, China, March 18, 2025 (GLOBE NEWSWIRE) — LexinFintech Holdings Ltd. (“Lexin” or the “Company”) (NASDAQ: LX), a leading technology-empowered personal financial service enabler in China, today announced its unaudited financial results for the quarter ended December 31, 2024.

Mr. Jay Wenjie Xiao, Chairman and Chief Executive Officer of Lexin, commented, “The company remains committed to its prudent operating strategy and has achieved solid progress in its transformation, with key performance indicators showing continuous improvement.

For the fourth quarter, net income was RMB363 million, representing an increase of about 17% quarter-over-quarter, marking the fourth consecutive quarter of improved profitability. Total loan origination reached RMB52 billion, representing approximately a 2% quarter-over-quarter increase, and outstanding loan balance stood at RMB110 billion, all in line with our guidance.

As we advanced our risk management upgrading, we were pleased to see a continuous improvement in asset quality, evidenced by the decline in risk indicators of both newly originated and overall assets. This consistent enhancement in asset quality, along with ongoing operational refinements, has contributed to our sustainable profit growth.

Looking ahead to 2025, in light of the current macroeconomic and industry landscape, we will adhere to our prudent operating strategy, prioritizing asset quality and focusing on profitability enhancement. With this approach, we expect to sustain steady growth in our performance.

In accordance with our semi-annual dividend policy, the board of directors has approved a dividend of US$0.11 per ADS, representing 20% of net income from the second half of 2024. Effective from January 1, 2025, our cash dividend payout ratio will be raised to 25% of net income.”

Mr. James Zheng, Chief Financial Officer of Lexin, commented, “Building upon the solid foundation of the third quarter, we recorded a net income of RMB363 million in the fourth quarter, representing a 17% increase compared to last quarter and 54% increase compared to the net income adjusted for the investment losses in the same period last year, further extending our stable growth trajectory. The net income take rate, calculated as net income divided by the average loan balance, increased from 1.09% in the third quarter to 1.31% in the fourth quarter of 2024, advancing by 22 basis points.”

“Driven by the ongoing optimization of asset quality, further reduction in funding costs, a more balanced revenue mix, and improvement in customer acquisition efficiency, our revenue take rate and net income have continued to improve.”

“Having achieved substantial progress in our transformation, we will continue to execute our prudent operating strategy. Looking ahead, we expect flat to single-digit growth of total loan origination in 2025 in view of the macroeconomic conditions, alongside a significant year-over-year increase in net income driven by margin expansion.”

Fourth Quarter and Full Year 2024 Operational Highlights:

User Base

Total number of registered users reached 228 million as of December 31, 2024, representing an increase of 8.6% from 210 million as of December 31, 2023, and users with credit lines reached 45.1 million as of December 31, 2024, up by 6.8% from 42.3 million as of December 31, 2023.
Number of active users¹ who used our loan products in the fourth quarter of 2024 was 4.7 million, representing a decrease of 0.7% from 4.7 million in the fourth quarter of 2023. Number of active users¹ who used our loan products in 2024 was 8.2 million, representing a decrease of 4.3% from 8.5 million in 2023.
Number of cumulative borrowers with successful drawdown was 33.8 million as of December 31, 2024, an increase of 7.1% from 31.5 million as of December 31, 2023.

Loan Facilitation Business

As of December 31, 2024, we cumulatively originated RMB1,325.1 billion in loans, an increase of 19.1% from RMB1,113.1 billion as of December 31, 2023.
Total loan originations² in the fourth quarter of 2024 was RMB52.0 billion, a decrease of 15.2% from RMB61.2 billion in the fourth quarter of 2023. Total loan originations² in 2024 was RMB212 billion, a decrease of 15.0% from RMB250 billion in 2023.
Total outstanding principal balance of loans³ reached RMB110 billion as of December 31, 2024, representing a decrease of 11.1% from RMB124 billion as of December 31, 2023.

Credit Performance⁴

90 day+ delinquency ratio was 3.6% as of December 31, 2024, as compared with 3.7% as of September 30, 2024.
First payment default rate (30 day+) for new loan originations was below 1% as of December 31, 2024.

Tech-empowerment Service

For the fourth quarter of 2024, we served over 100 business customers with our tech-empowerment service.
In the fourth quarter of 2024, the business customer retention rate⁵ of our tech-empowerment service was over 80%.

Installment E-commerce Platform Service

GMV⁶ in the fourth quarter of 2024 for our installment e-commerce platform service was RMB969 million, representing a decrease of 25.0% from RMB1,292 million in the fourth quarter of 2023. GMV⁶ in 2024 for our installment e-commerce platform service was RMB3,633 million, representing a decrease of 31.3% from RMB5,289 million in 2023.
In the fourth quarter of 2024, our installment e-commerce platform service served over 280,000 users and 400 merchants.

Other Operational Highlights

The weighted average tenor of loans originated on our platform in the fourth quarter of 2024 was approximately 13.1 months, as compared with 12.3 months in the fourth quarter of 2023. The weighted average tenor of loans originated on our platform in 2024 was approximately 12.9 months, as compared with 13.8 months in 2023.
Repeated borrowers’ contribution⁷ of loans across our platform for the fourth quarter of 2024 was 85.3%. Repeated borrowers’ contribution⁷ of loans across our platform for 2024 was 85.7%.

Fourth Quarter 2024 Financial Highlights:

Total operating revenue was RMB3,659 million, representing an increase of 4.3% from the fourth quarter of 2023.
Credit facilitation service income was RMB2,712 million, representing a decrease of 0.5% from the fourth quarter of 2023. Tech-empowerment service income was RMB602 million, representing an increase of 41.0% from the fourth quarter of 2023. Installment e-commerce platform service income was RMB345 million, representing a decrease of 2.9% from the fourth quarter of 2023.
Net income attributable to ordinary shareholders of the Company was RMB363 million, representing an increase of over 100% from the fourth quarter of 2023. Net income per ADS attributable to ordinary shareholders of the Company was RMB2.06 on a fully diluted basis.
Adjusted net income attributable to ordinary shareholders of the Company⁸ was RMB391 million, representing an increase of 37.7% from the fourth quarter of 2023. Adjusted net income per ADS attributable to ordinary shareholders of the Company⁸ was RMB2.22 on a fully diluted basis.

Full Year 2024 Financial Highlights:

Total operating revenue was RMB14,204 million, representing an increase of 8.8% from 2023.
Credit facilitation service income was RMB11,000 million, representing an increase of 13.8% from 2023. Tech-empowerment service income was RMB1,881 million, representing an increase of 14.7% from 2023. Installment e-commerce platform service income was RMB1,322 million, representing a decrease of 24.5% from 2023.
Net income attributable to ordinary shareholders of the Company was RMB1,100 million, representing an increase of 3.2% from 2023. Net income per ADS attributable to ordinary shareholders of the Company was RMB6.49 on a fully diluted basis.
Adjusted net income attributable to ordinary shareholders of the Company⁸ was RMB1,203 million, representing a decrease of 19.0% from 2023. Adjusted net income per ADS attributable to ordinary shareholders of the Company⁸ was RMB7.09 on a fully diluted basis.

__________________________

Active users refer to, for a specified period, users who made at least one transaction during that period through our platform or through our third-party partners’ platforms using the credit line granted by us.
Total loan originations refer to the total principal amount of loans facilitated and originated during the given period.
Total outstanding principal balance of loans refers to the total amount of principal outstanding for loans facilitated and originated at the end of each period, excluding loans delinquent for more than 180 days.
Loans under Intelligent Credit Platform are excluded from the calculation of credit performance. Intelligent Credit Platform (ICP) is an intelligent platform on our “Fenqile” app, under which we match borrowers and financial institutions through big data and cloud computing technology. For loans facilitated through ICP, the Company does not bear principal risk.
Customer retention rate refers to the number of financial institution customers and partners who repurchase our service in the current quarter as a percentage of the total number of financial institution customers and partners in the preceding quarter.
GMV refers to the total value of transactions completed for products purchased on our e-commerce and Maiya channel, net of returns.
Repeated borrowers’ contribution for a given period refers to the principal amount of loans borrowed during that period by borrowers who had previously made at least one successful drawdown as a percentage of the total loan facilitation and origination volume through our platform during that period.
Adjusted net income attributable to ordinary shareholders of the Company, adjusted net income per ordinary share and per ADS attributable to ordinary shareholders of the Company are non-GAAP financial measures. For more information on non-GAAP financial measures, please see the section of “Use of Non-GAAP Financial Measures Statement” and the tables captioned “Unaudited Reconciliations of GAAP and Non-GAAP Results” set forth at the end of this press release.

Fourth Quarter 2024 Financial Results:

Operating revenue increased by 4.3% from RMB3,509 million in the fourth quarter of 2023 to RMB3,659 million in the fourth quarter of 2024.

Credit facilitation service income was RMB2,712 million in the fourth quarter of 2024 as compared to RMB2,727 million in the fourth quarter of 2023. The decrease was driven by the decrease in guarantee income, partially offset by the increases in loan facilitation and servicing fees-credit oriented and financing income.

Loan facilitation and servicing fees-credit oriented increased by 4.2% from RMB1,559 million in the fourth quarter of 2023 to RMB1,624 million in the fourth quarter of 2024. The increase was primarily driven by the increase in takerate of loan facilitation business.

Guarantee income decreased by 18.6% from RMB709 million in the fourth quarter of 2023 to RMB577 million in the fourth quarter of 2024. The decrease was primarily due to the decrease of outstanding balances in the off-balance sheet loans funded by certain institutional funding partners, which are accounted for under ASC 460, Guarantees.

Financing income increased by 11.2% from RMB459 million in the fourth quarter of 2023 to RMB510 million in the fourth quarter of 2024. The increase was primarily driven by the increase in the origination of on-balance sheet loans.

Tech-empowerment service income increased by 41.0% from RMB427 million in the fourth quarter of 2023 to RMB602 million in the fourth quarter of 2024. The increase was primarily driven by the increase of loan facilitation volume through ICP.

Installment e-commerce platform service income was RMB345 million in the fourth quarter of 2024, as compared to RMB356 million in the fourth quarter of 2023.

Cost of sales was RMB353 million in the fourth quarter of 2024, as compared to RMB344 million in the fourth quarter of 2023.

Funding cost decreased by 24.6% from RMB76.2 million in the fourth quarter of 2023 to RMB57.5 million in the fourth quarter of 2024, which was primarily driven by the decrease in the cost of funding to fund the on-balance sheet loans.

Processing and servicing costs increased by 13.4% from RMB514 million in the fourth quarter of 2023 to RMB583 million in the fourth quarter of 2024. This increase was primarily due to an increase in risk management and collection expenses.

Provision for financing receivables was RMB297 million for the fourth quarter of 2024, as compared to RMB180 million for the fourth quarter of 2023. The increase was primarily due to the increase of the outstanding loan balances of on-balance sheet loans.

Provision for contract assets and receivables was RMB154 million in the fourth quarter of 2024, as compared to RMB203 million in the fourth quarter of 2023. The decrease was primarily driven by the decrease of the outstanding loan balances of off-balance sheet loans.

Provision for contingent guarantee liabilities was RMB941 million in the fourth quarter of 2024, as compared to RMB934 million in the fourth quarter of 2023.

Gross profit was RMB1,274 million in the fourth quarter of 2024, as compared to RMB1,258 million in the fourth quarter of 2023.

Sales and marketing expenses was RMB464 million in the fourth quarter of 2024, as compared to RMB430 million in the fourth quarter of 2023. This increase was primarily due to an increase in online advertising costs.

Research and development expenses was RMB151 million in the fourth quarter of 2024, as compared to RMB136 million in the fourth quarter of 2023. The increase was primarily due to increased investment in technology development.

General and administrative expenses decreased by 12.0% from RMB108 million in the fourth quarter of 2023 to RMB95.3 million in the fourth quarter of 2024, primarily as a result of the Company’s expense control measures.

Change in fair value of financial guarantee derivatives and loans at fair value was a loss of RMB144 million in the fourth quarter of 2024, as compared to a loss of RMB248 million in the fourth quarter of 2023. The change was primarily due to the fair value loss from the re-measurement of the expected loss rates, partially offset by the fair value gains realized as a result of the release of guarantee obligation.

Income tax expense was RMB67.6 million in the fourth quarter of 2024, as compared to income tax benefit of RMB9.7 million in the fourth quarter of 2023. The change was primarily due to the increase of income before income tax expense.

Net income increased over 100% from RMB12.1 million in the fourth quarter of 2023 to RMB363 million in the fourth quarter of 2024.

Full Year 2024 Financial Results:

Operating revenue increased by 8.8% from RMB13,057 million in 2023 to RMB14,204 million in 2024.

Credit facilitation service income increased by 13.8% from RMB9,666 million in 2023 to RMB11,000 million in 2024. The increase was driven by the increases in loan facilitation and servicing fees-credit oriented and guarantee income, partially offset by the decrease in financing income.

Loan facilitation and servicing fees-credit oriented increased by 26.5% from RMB5,002 million in 2023 to RMB6,326 million in 2024. The increase was primarily due to the increase in takerate of loan facilitation business.

Guarantee income increased by 5.7% from RMB2,519 million in 2023 to RMB2,664 million in 2024. The increase was primarily due to the increase in cumulative loan origination funded by certain institutional funding partners, which are accounted for under ASC 460, Guarantees.

Financing income decreased by 6.3% from RMB2,145 million in 2023 to RMB2,010 million in 2024. The decrease was primarily due to the decrease in the origination of on-balance sheet loans.

Tech-empowerment service income increased by 14.7% from RMB1,640 million in 2023 to RMB1,881 million in 2024. The increase was primarily due to the increase of loan facilitation volume through ICP.

Installment e-commerce platform service income decreased by 24.5% from RMB1,751 million in 2023 to RMB1,322 million in 2024. The decrease was primarily due to the decrease in transaction volume in 2024.

Cost of sales decreased by 19.3% from RMB1,636 million in 2023 to RMB1,320 million in 2024, which was consistent with the decrease in installment e-commerce platform service income.

Funding cost decreased by 36.5% from RMB514 million in 2023 to RMB326 million in 2024, which was primarily driven by the decrease in the cost of funding to fund the on-balance sheet loans.

Processing and servicing costs increased by 18.4% from RMB1,935 million in 2023 to RMB2,292 million in 2024. This increase was primarily due to an increase in risk management and collection expenses.

Provision for financing receivables was RMB866 million in 2024, as compared to RMB627 million in 2023. The increase was primarily due to the increase of the outstanding loan balances of on-balance sheet loans.

Provision for contract assets and receivables was RMB718 million in 2024, as compared to RMB629 million in 2023. The increase was primarily due to the increase of the outstanding loan balances of off-balance sheet loans.

Provision for contingent guarantee liabilities was RMB3,656 million in 2024, as compared to RMB3,203 million in 2023. The fluctuation was primarily due to the re-measurement of the expected loss rates, which are accounted for under ASC 460, Guarantees.

Gross profit increased by 11.4% from RMB4,513 million in 2023 to RMB5,026 million in 2024.

Sales and marketing expenses was RMB1,787 million in 2024, as compared to RMB1,733 million in 2023.

Research and development expenses was RMB578 million in the quarter of 2024, as compared to RMB513 million in 2023. The increase was primarily due to increased investment in technology development.

General and administrative expenses was RMB374 million in 2024, as compared to RMB387 million in 2023.

Change in fair value of financial guarantee derivatives and loans at fair value was a loss of RMB979 million in 2024, as compared to a loss of RMB206 million in 2023. The change was primarily due to the fair value loss from the re-measurement of the expected loss rates, partially offset by the fair value gains realized as a result of the release of guarantee obligation.

Income tax expense was RMB253 million in 2024, as compared to RMB261 million in 2023. The change was primarily due to the decrease of effective tax rate.

Net income increased by 3.2% from RMB1,066 million in 2023 to RMB1,100 million in the 2024.

Recent Development

Semi-Annual Dividend
The board of directors of the Company has approved a dividend of US$0.055 per ordinary share, or US$0.11 per ADS, for the six-month period ended December 31, 2024 in accordance with the Company’s dividend policy, which is expected to be paid on May 16, 2025 to shareholders of record (including holders of ADSs) as of the close of business on April 17, 2025 New York time.

Outlook
Looking ahead, while our performance continues to demonstrate positive momentum, we remain prudent in light of ongoing macroeconomic uncertainties. Therefore, for full year 2025, we expect total loan origination to have flat to single-digit year-on-year growth depending on the macroeconomic conditions, alongside a significant increase in net income driven by continuing improvement in asset quality. These forecasts are subject to the impact of macroeconomic factors, and the company may adjust its performance outlook as appropriate based on evolving circumstances.

Conference Call

The Company’s management will host an earnings conference call at 10:00 PM U.S. Eastern time on March 18, 2025 (10:00 AM Beijing/Hong Kong time on March 19, 2025).

Participants who wish to join the conference call should register online at:

Once registration is completed, each participant will receive the dial-in number and a unique access PIN for the conference call.

Participants joining the conference call should dial in at least 10 minutes before the scheduled start time.

A live and archived webcast of the conference call will also be available at the Company’s investor relations website at http://ir.lexin.com.

About LexinFintech Holdings Ltd.

We are a leading credit technology-empowered personal financial service enabler. Our mission is to use technology and risk management expertise to make financing more accessible for young generation consumers. We strive to achieve this mission by connecting consumers with financial institutions, where we facilitate through a unique model that includes online and offline channels, installment consumption platform, big data and AI driven credit risk management capabilities, as well as smart user and loan management systems. We also empower financial institutions by providing cutting-edge proprietary technology solutions to meet their needs of financial digital transformation.

For more information, please visit http://ir.lexin.com.

To follow us on Twitter, please go to: https://twitter.com/LexinFintech.

Use of Non-GAAP Financial Measures Statement

In evaluating our business, we consider and use adjusted net income attributable to ordinary shareholders of the Company, non-GAAP EBIT, adjusted net income per ordinary share and per ADS attributable to ordinary shareholders of the Company, four non-GAAP measures, as supplemental measures to review and assess our operating performance. The presentation of the non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. We define adjusted net income attributable to ordinary shareholders of the Company as net income attributable to ordinary shareholders of the Company excluding share-based compensation expenses, interest expense associated with convertible notes, and investment income/(loss) and we define non-GAAP EBIT as net income excluding income tax expense, share-based compensation expenses, interest expense, net, and investment income/(loss).

We present these non-GAAP financial measures because they are used by our management to evaluate our operating performance and formulate business plans. Adjusted net income attributable to ordinary shareholders of the Company enables our management to assess our operating results without considering the impact of share-based compensation expenses, interest expense associated with convertible notes, and investment income/(loss). Non-GAAP EBIT, on the other hand, enables our management to assess our operating results without considering the impact of income tax expense, share-based compensation expenses, interest expense, net, and investment income/(loss). We also believe that the use of these non-GAAP financial measures facilitates investors’ assessment of our operating performance. These non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP.

These non-GAAP financial measures have limitations as an analytical tool. One of the key limitations of using adjusted net income attributable to ordinary shareholders of the Company and non-GAAP EBIT is that they do not reflect all items of income and expense that affect our operations. Share-based compensation expenses, interest expense associated with convertible notes, income tax expense, interest expense, net, and investment income/(loss) have been and may continue to be incurred in our business and are not reflected in the presentation of adjusted net income attributable to ordinary shareholders of the Company and non-GAAP EBIT. Further, these non-GAAP financial measures may differ from the non-GAAP financial information used by other companies, including peer companies, and therefore their comparability may be limited.

We compensate for these limitations by reconciling each of the non-GAAP financial measures to the most directly comparable U.S. GAAP financial measure, which should be considered when evaluating our performance. We encourage you to review our financial information in its entirety and not rely on a single financial measure.

Exchange Rate Information Statement

This announcement contains translations of certain RMB amounts into U.S. dollars (“US$”) at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to US$ were made at the rate of RMB7.2993 to US$1.00, the exchange rate set forth in the H.10 statistical release of the Federal Reserve Board on December 31, 2024. The Company makes no representation that the RMB or US$ amounts referred could be converted into US$ or RMB, as the case may be, at any particular rate or at all.

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including statements about Lexin’s beliefs and expectations, are forward-looking statements. These forward-looking statements can be identified by terminology such as “will,” “ expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” “confident” and similar statements. Among other things, the expectation of the collection efficiency and delinquency, business outlook and quotations from management in this announcement, contain forward-looking statements. Lexin may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Lexin’s goal and strategies; Lexin’s expansion plans; Lexin’s future business development, financial condition and results of operations; Lexin’s expectation regarding demand for, and market acceptance of, its credit and investment management products; Lexin’s expectations regarding keeping and strengthening its relationship with borrowers, institutional funding partners, merchandise suppliers and other parties it collaborates with; general economic and business conditions; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in Lexin’s filings with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and Lexin does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

For investor and media inquiries, please contact:

LexinFintech Holdings Ltd.
IR inquiries:
Will Tan
Tel: +86 (755) 3637-8888 ext. 6258
E-mail: willtan@lexin.com

Media inquiries:
Ruifeng Xu
Tel: +86 (755) 3637-8888 ext. 6993
E-mail: media@lexin.com

SOURCE LexinFintech Holdings Ltd.

LexinFintech Holdings Ltd. Unaudited Condensed Consolidated Balance Sheets
	As of
(In thousands)	December 31, 2023			December 31, 2024
	RMB			RMB			US$
ASSETS
Current Assets
Cash and cash equivalents		2,624,719			2,254,213			308,826
Restricted cash		1,433,502			1,638,479			224,471
Restricted term deposit and short-term investments		305,182			138,497			18,974
Short-term financing receivables, net⁽¹⁾		3,944,000			4,668,715			639,611
Short-term contract assets and receivables, net⁽¹⁾		6,112,981			5,448,057			746,381
Deposits to insurance companies and guarantee companies		2,613,271			2,355,343			322,681
Prepayments and other current assets		1,428,769			1,321,340			181,024
Amounts due from related parties		6,989			61,722			8,456
Inventories, net		33,605			22,345			3,061
Total Current Assets		18,503,018			17,908,711			2,453,485
Non-current Assets
Restricted cash		144,948			100,860			13,818
Long-term financing receivables, net⁽¹⁾		200,514			112,427			15,402
Long-term contract assets and receivables, net⁽¹⁾		599,818			317,402			43,484
Property, equipment and software, net		446,640			613,110			83,996
Land use rights, net		897,267			862,867			118,212
Long‑term investments		255,003			284,197			38,935
Deferred tax assets		1,232,092			1,540,842			211,094
Other assets		861,491			500,363			68,549
Total Non-current Assets		4,637,773			4,332,068			593,490
TOTAL ASSETS		23,140,791			22,240,779			3,046,975

LIABILITIES
Current liabilities
Accounts payable		49,801			74,443			10,199
Amounts due to related parties		2,958			10,927			1,497
Short‑term borrowings		502,013			690,772			94,635
Short‑term funding debts		3,483,196			2,754,454			377,359
Deferred guarantee income		1,538,385			975,102			133,588
Contingent guarantee liabilities		1,808,540			1,079,000			147,822
Accruals and other current liabilities		4,434,254			4,019,676			550,691
Convertible notes		505,450			–			–
Total Current Liabilities		12,324,597			9,604,374			1,315,791
Non-current Liabilities
Long-term borrowings		524,270			585,024			80,148
Long‑term funding debts		455,800			1,197,211			164,017
Deferred tax liabilities		75,340			91,380			12,519
Other long-term liabilities		50,702			22,784			3,121
Total Non-current Liabilities		1,106,112			1,896,399			259,805
TOTAL LIABILITIES		13,430,709			11,500,773			1,575,596
Shareholders’ equity:
Class A Ordinary Shares		199			205			31
Class B Ordinary Shares		41			41			7
Treasury stock		(328,764	)		(328,764	)		(45,040	)
Additional paid-in capital		3,204,961			3,314,866			454,134
Statutory reserves		1,106,579			1,178,309			161,428
Accumulated other comprehensive income		(13,545	)		(29,559	)		(4,050	)
Retained earnings		5,740,611			6,604,908			904,869
Total shareholders’ equity		9,710,082			10,740,006			1,471,379
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		23,140,791			22,240,779			3,046,975

__________________________
(1) Short-term financing receivables, net of allowance for credit losses of RMB58,594 and RMB102,124 as of December 31, 2023 and December 31, 2024, respectively.

Short-term contract assets and receivables, net of allowance for credit losses of RMB436,136 and RMB409,590 as of December 31, 2023 and December 31, 2024, respectively.

Long-term financing receivables, net of allowance for credit losses of RMB3,087 and RMB1,820 as of December 31, 2023 and December 31, 2024, respectively.

Long-term contract assets and receivables, net of allowance for credit losses of RMB61,838 and RMB30,919 as of December 31, 2023 and December 31, 2024, respectively.

LexinFintech Holdings Ltd. Unaudited Condensed Consolidated Statements of Operations
	For the Three Months Ended December 31,								For the Year Ended December 31,
(In thousands, except for share and per share data)	2023		2024						2023			2024
	RMB		RMB			US$			RMB			RMB			US$
Operating revenue:
Credit facilitation service income	2,727,020			2,712,066			371,552			9,666,120			10,999,931			1,506,984
Loan facilitation and servicing fees-credit oriented	1,558,588			1,624,410			222,543			5,001,881			6,325,924			866,648
Guarantee income	709,422			577,168			79,072			2,519,284			2,663,824			364,942
Financing income	459,010			510,488			69,937			2,144,955			2,010,183			275,394
Tech-empowerment service income	426,882			601,693			82,432			1,640,453			1,881,376			257,747
Installment e-commerce platform service income	355,534			345,074			47,275			1,750,509			1,322,287			181,153
Total operating revenue	3,509,436			3,658,833			501,259			13,057,082			14,203,594			1,945,884
Operating cost
Cost of sales	(344,088	)		(352,749	)		(48,326	)		(1,635,635	)		(1,319,526	)		(180,774	)
Funding cost	(76,195	)		(57,471	)		(7,873	)		(513,869	)		(326,451	)		(44,724	)
Processing and servicing cost	(514,070	)		(583,119	)		(79,887	)		(1,935,016	)		(2,291,904	)		(313,990	)
Provision for financing receivables	(180,475	)		(296,741	)		(40,653	)		(627,061	)		(865,524	)		(118,576	)
Provision for contract assets and receivables	(202,677	)		(153,968	)		(21,094	)		(629,308	)		(718,413	)		(98,422	)
Provision for contingent guarantee liabilities	(933,854	)		(940,740	)		(128,881	)		(3,203,123	)		(3,655,548	)		(500,808	)
Total operating cost	(2,251,359	)		(2,384,788	)		(326,714	)		(8,544,012	)		(9,177,366	)		(1,257,294	)
Gross profit	1,258,077			1,274,045			174,545			4,513,070			5,026,228			688,590
Operating expenses:
Sales and marketing expenses	(429,573	)		(464,263	)		(63,604	)		(1,733,301	)		(1,787,299	)		(244,859	)
Research and development expenses	(135,837	)		(151,081	)		(20,698	)		(513,284	)		(578,243	)		(79,219	)
General and administrative expenses	(108,305	)		(95,335	)		(13,061	)		(387,387	)		(374,481	)		(51,304	)
Total operating expenses	(673,715	)		(710,679	)		(97,363	)		(2,633,972	)		(2,740,023	)		(375,382	)
Change in fair value of financial guarantee derivatives and loans at fair value	(247,526	)		(143,619	)		(19,676	)		(206,368	)		(979,234	)		(134,155	)
Interest expense, net	(10,245	)		(2,560	)		(351	)		(50,483	)		(9,007	)		(1,234	)
Investment loss	(302,128	)		(543	)		(74	)		(303,235	)		(2,417	)		(331	)
Others, net	(22,092	)		13,754			1,884			7,774			58,188			7,972
Income before income tax expense	2,371			430,398			58,965			1,326,786			1,353,735			185,460
Income tax benefit/(expense)	9,726			(67,649	)		(9,268	)		(260,841	)		(253,275	)		(34,699	)
Net income	12,097			362,749			49,697			1,065,945			1,100,460			150,761
Net income attributable to ordinary shareholders of the Company	12,097			362,749			49,697			1,065,945			1,100,460			150,761

Net income per ordinary share attributable to ordinary shareholders of the Company
Basic	0.04			1.09			0.15			3.24			3.32			0.45
Diluted	0.04			1.03			0.14			3.17			3.24			0.44

Net income per ADS attributable to ordinary shareholders of the Company
Basic	0.07			2.18			0.30			6.49			6.64			0.91
Diluted	0.07			2.06			0.28			6.34			6.49			0.89

Weighted average ordinary shares outstanding
Basic	329,297,640			333,182,976			333,182,976			328,523,952			331,403,936			331,403,936
Diluted	331,941,385			351,577,582			351,577,582			359,820,982			339,261,349			339,261,349

LexinFintech Holdings Ltd.
Unaudited Condensed Consolidated Statements of Comprehensive Income

For the Three Months Ended December 31,

For the Year Ended December 31,

(In thousands)

2023

2024

2023

2024

RMB

US$

RMB

US$

Net income

12,097

362,749

49,697

1,065,945

1,100,460

150,761

Other comprehensive income

Foreign currency translation adjustment, net of nil tax

27,841

642

88

7,297

(16,014

)

(2,194

)

Total comprehensive income

39,938

363,391

49,785

1,073,242

1,084,446

148,567

Total comprehensive income attributable to ordinary shareholders of the Company

39,938

363,391

49,785

1,073,242

1,084,446

148,567

LexinFintech Holdings Ltd. Unaudited Reconciliations of GAAP and Non-GAAP Results
	For the Three Months Ended December 31,							For the Year Ended December 31,
(In thousands, except for share and per share data)	2023			2024				2023			2024
	RMB			RMB		US$		RMB			RMB		US$
Reconciliation of Adjusted net income attributable to ordinary shareholders of the Company to Net income attributable to ordinary shareholders of the Company
Net income attributable to ordinary shareholders of the Company		12,097			362,749		49,697		1,065,945			1,100,460		150,761
Add: Share-based compensation expenses		32,959			27,244		3,732		117,852			94,623		12,963
Interest expense associated with convertible notes		11,943			–		–		73,807			5,695		780
Investment loss		302,128			543		74		303,235			2,417		331
Tax effects on Non-GAAP adjustments ⁽²⁾		(75,440	)		–		–		(75,440	)		–		–
Adjusted net income attributable to ordinary shareholders of the Company		283,687			390,536		53,503		1,485,399			1,203,195		164,835

Adjusted net income per ordinary share attributable to ordinary shareholders of the Company
Basic		0.86			1.17		0.16		4.52			3.63		0.50
Diluted		0.82			1.11		0.15		4.13			3.55		0.49

Adjusted net income per ADS attributable to ordinary shareholders of the Company
Basic		1.72			2.34		0.32		9.04			7.26		0.99
Diluted		1.64			2.22		0.30		8.26			7.09		0.97

Weighted average shares used in calculating net income per ordinary share for non-GAAP EPS
Basic		329,297,640			333,182,976		333,182,976		328,523,952			331,403,936		331,403,936
Diluted		345,913,435			351,577,582		351,577,582		359,820,982			339,261,349		339,261,349

Reconciliations of Non-GAAP EBIT to Net income
Net income		12,097			362,749		49,697		1,065,945			1,100,460		150,761
Add: Income tax (benefit)/expense		(9,726	)		67,649		9,268		260,841			253,275		34,699
Share-based compensation expenses		32,959			27,244		3,732		117,852			94,623		12,963
Interest expense, net		10,245			2,560		351		50,483			9,007		1,234
Investment loss		302,128			543		74		303,235			2,417		331
Non-GAAP EBIT		347,703			460,745		63,122		1,798,356			1,459,782		199,988

(2) To exclude the tax effects related to the investment loss

Additional Credit Information

Vintage Charge Off Curve¹

Dpd30+/GMV by Performance Windows¹

First Payment Default 30+¹

1. Loans facilitated under ICP are excluded from the chart.

MIL-OSI: Aterian Reports Fourth Quarter & Full Year 2024 Results

Source: GlobeNewswire (MIL-OSI)

Introduces Annual Guidance for 2025
Announces $3 Million Share Repurchase Program

SUMMIT, N.J., March 18, 2025 (GLOBE NEWSWIRE) — Aterian, Inc. (Nasdaq: ATER) (“Aterian” or the “Company”), a technology-enabled consumer products company, today announced financial results for the fourth quarter and full year ended December 31, 2024.

“Aterian’s results for 2024 reflect our team’s success in executing a strategy to focus, stabilize, and simplify our operations in preparation for a resumption of growth and improved operating performance, ” said Arturo Rodriguez, Chief Executive Officer.

“Our decision to rationalize SKUs and focus on the Company’s six foundational brands generated material improvements in gross margin and contribution margin, and narrowed our losses significantly compared to 2023,” continued Mr. Rodriguez. “We improved our cash flow and working capital profile, reduced debt by more than $4.0 million, and right sized our inventory to focus on Aterian’s most profitable products. These initiatives created a momentum that we believe will carry into 2025. Despite tariffs, we are confident that in 2025, especially with our experienced and tenacious team, we will be able to generate higher revenues, achieve greater operating efficiency, and further improve our profit profile. Our growth will be driven by new product introductions beginning in the second quarter of 2025 and access to a broader base of consumers through our sales channel initiatives.”

Fourth Quarter 2024 Highlights
All comparisons are to the fourth quarter ended December 31, 2023

Net revenue was $24.6 million compared to $32.8 million, primarily reflecting the previously announced SKU rationalization designed to focus on the Company’s most profitable products, lower liquidation levels of high-cost inventory, and initial contributions from new product introductions.
Gross margin improved to 63.4% from 51.0%, reflecting the success of the above-referenced SKU rationalization and improved inventory profile.
Contribution margin improved to 19.4% from (0.8%).
Operating loss narrowed to ($1.6) million from an operating loss of ($8.2) million. Fourth quarter 2024 operating loss included ($1.1) million of non-cash stock compensation, while fourth quarter 2023 operating loss included ($1.6) million of non-cash stock compensation, a non-cash loss on impairment of an intangible of ($0.3) million and a reserve for barter credits of ($0.3).
Net loss improved to ($1.3) million from ($7.7) million. Fourth quarter 2024 net loss included ($1.1) million of non-cash stock compensation and a gain on fair value of warrant liability of $0.2 million, while fourth quarter 2023 net loss included a reserve for barter credits of ($0.3) million, ($1.6) million of non-cash stock compensation, a non-cash loss on impairment of an intangible of ($0.3) million.
Adjusted EBITDA loss improved to ($0.1) million from a loss of ($5.6) million.
Total cash balance at December 31, 2024 was $18.0 million, up from $16.1 million at September 30, 2024.
Cash flow from operations improved to break-even from cash used in operations of ($4.9) million for the three months ended December 31, 2023.

Full Year 2024 Highlights
All comparisons are to the full year ended December 31, 2023

Net revenue declined to $99.0 million from $142.6 million, reflecting the success of the SKU rationalization, improved inventory profile, and new product introductions.
Gross margin improved to 62.1% compared to 49.3% in 2023, primarily reflecting the success of the above-referenced SKU rationalization and improved inventory profile.
Contribution margin rose to 17.1% from 1.2% in 2023.
Operating loss improved to ($11.8) million from ($76.2) million in 2023. Full year 2024 operating loss included ($7.5) million of non-cash stock compensation, and restructuring costs of ($0.6) million, while full year 2023 operating loss included ($8.3) million of non-cash stock compensation, a non-cash loss on impairment of intangibles of ($39.7) million, restructuring costs of ($1.6) million and a reserve for barter credits of ($0.3).
Net loss narrowed to ($11.9) million from ($74.6) million in 2023. Full year 2024 net loss includes ($7.5) million of non-cash stock compensation, restructuring costs of ($0.6) million, and a gain on fair value of warrant liability of $0.9 million, while full year 2023 net loss included ($8.3) million of non-cash stock compensation, a non-cash loss on impairment of intangibles of ($39.7) million, restructuring costs of ($1.6) million, a gain on fair value of warrant liability of $2.4 million, and a reserve on barter credits of ($0.3) million.
Adjusted EBITDA loss improved to ($2.1) million from a loss of ($22.3) million in 2023.
Total cash balance at December 31, 2024 was $18.0 million, down from $20.0 million at December 31, 2023.
Cash flow from operations improved to $2.2 million from cash used in operations of ($13.4) million for the year ended December 31, 2023.

2025 Outlook

For fiscal year 2025, taking into account the current global environment and impact of recently announced tariffs, the Company believes that net revenue will be between $104 million and $106 million, an increase of between 5% and 7% from net revenue of $99.0 million 2024. When considering approximately $4 million of net sales in 2024 related to discontinued SKUs, net revenue in 2025 is expected to increase on a pro forma basis by 9% to 12%.

The Company expects 2025 annual Adjusted EBITDA to be essentially break-even compared to an Adjusted EBITDA loss of $(2.1) million in 2024, reflecting the success of the Company’s business improvement initiatives, offset by the impacts of recently announced tariffs.

Josh Feldman, Chief Financial Officer commented, “We continue to monitor the tariff situation and its potential impact on our operations and outlook. We have already taken steps that we believe will mitigate the negative effects of tariffs in 2025, and are prepared to take further action as necessary. With the support of an exceptional team, an inherent agility, and strong balance sheet, we remain confident in our ability to successfully and proactively navigate these challenges while remaining focused on long-term growth and profitability.”

Share Repurchase Plan
As announced earlier today, the Company’s Board of Directors has authorized a share repurchase program of up to $3.0 million of the Company’s common stock for a period of two years ending March 18, 2027.

Non-GAAP Financial Measures
For more information on our non-GAAP financial measures and a reconciliation of GAAP to non-GAAP measures, please see the “Non-GAAP Financial Measures” section below. The most directly comparable GAAP financial measure for EBITDA and adjusted EBITDA is net loss and we expect to report a net loss for the years ending December 31, 2024 and December 31, 2025 due primarily to our operating losses, which includes stock-based compensation expense, and interest expense. We are unable to reconcile the forward-looking statements of EBITDA and adjusted EBITDA in this press release to their nearest GAAP measures because the nearest GAAP financial measures are not accessible on a forward-looking basis and reconciling information is not available without unreasonable effort.

Webcast and Conference Call Information
Aterian will host a live conference call to discuss financial results today, March 18, 2025, at 5:00 p.m. Eastern Time, which will be accessible by telephone and the internet. To access the call, participants from within the U.S. should dial (800) 715-9871 and participants from outside the U.S. should dial (646) 307-1963 and ask to be joined into the Aterian, Inc. call or use conference ID 3432648. Participants may also access the call through a live webcast at https://ir.aterian.io. The archived online replay will be available for a limited time after the call in the investors section of the Aterian corporate website.

About Aterian, Inc.
Aterian, Inc. (Nasdaq: ATER) is a technology-enabled consumer products company that builds and acquires leading e-commerce brands with top selling consumer products, in multiple categories, including home and kitchen appliances, health and wellness and air quality devices. The Company sells across the world’s largest online marketplaces with a focus on Amazon, Walmart and Target in the U.S. and on its own direct to consumer websites. Our primary brands include Squatty Potty, hOmeLabs, Mueller Living, Pursteam, Healing Solutions and Photo Paper Direct.

Forward Looking Statements
All statements other than statements of historical facts included in this press release that address activities, events or developments that we expect, believe or anticipate will or may occur in the future are forward-looking statements including, in particular, the statements regarding our projected net revenue and adjusted EBITDA for 2025, our guidance for 2025 and the current global environment and inflation. These forward-looking statements are based on management’s current expectations and beliefs and are subject to a number of risks and uncertainties and other factors, all of which are difficult to predict and many of which are beyond our control and could cause actual results to differ materially and adversely from those described in the forward-looking statements. These risks include, but are not limited to, those related to our ability to continue as a going concern, our ability to meet financial covenants with our lenders, our ability to maintain and to grow market share in existing and new product categories; our ability to continue to profitably sell the SKUs we operate; our ability to maintain Amazon’s Prime badge on our seller accounts or reinstate the Prime badge in the event of any removal of such badge by Amazon; our ability to create operating leverage and efficiency when integrating companies that we acquire, including through the use of our team’s expertise, the economies of scale of our supply chain and automation driven by our platform; those related to our ability to grow internationally and through the launch of products under our brands and the acquisition of additional brands; those related to consumer demand, our cash flows, financial condition, forecasting and revenue growth rate; our supply chain including sourcing, manufacturing, warehousing and fulfillment; our ability to manage expenses, working capital and capital expenditures efficiently; our business model and our technology platform; our ability to disrupt the consumer products industry; our ability to generate profitability and stockholder value; international tariffs and trade measures; inventory management, product liability claims, recalls or other safety and regulatory concerns; reliance on third party online marketplaces; seasonal and quarterly variations in our revenue; acquisitions of other companies and technologies and our ability to integrate such companies and technologies with our business; our ability to continue to access debt and equity capital (including on terms advantageous to the Company) and the extent of our leverage; and other factors discussed in the “Risk Factors” section of our most recent periodic reports filed with the Securities and Exchange Commission (“SEC”), all of which you may obtain for free on the SEC’s website at www.sec.gov.

Although we believe that the expectations reflected in our forward-looking statements are reasonable, we do not know whether our expectations will prove correct. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, even if subsequently made available by us on our website or otherwise. We do not undertake any obligation to update, amend or clarify these forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

Investor Contact:

The Equity Group

Devin Sullivan
Managing Director
dsullivan@equityny.com

Conor Rodriguez
Associate
crodriguez@equityny.com


ATERIAN, INC. Consolidated Balance Sheets (in thousands, except share and per share data)

	December 31, 2023			December 31, 2024
ASSETS
Current assets:
Cash	$	20,023		$	17,998
Accounts receivable, net		4,225			3,782
Inventory		20,390			13,749
Prepaid and other current assets		4,998			3,190
Total current assets		49,636			38,719
Property and equipment, net		775			685
Intangibles, net		11,320			9,757
Other non-current assets		138			381
Total assets	$	61,869		$	49,542
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Credit facility	$	11,098		$	6,948
Accounts payable		4,190			3,080
Seller notes		1,049			466
Accrued and other current liabilities		9,110			8,804
Total current liabilities		25,447			19,298
Other liabilities		391			227
Total liabilities		25,838			19,525
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.0001 par value, 500,000,000 shares authorized and 7,508,246 and 8,750,741 shares outstanding at December 31, 2023 and December 31, 2024, respectively(*)		9			9
Additional paid-in capital		736,675			742,591
Accumulated deficit		(699,815	)		(711,677	)
Accumulated other comprehensive loss		(838	)		(906	)
Total stockholders’ equity		36,031			30,017
Total liabilities and stockholders’ equity	$	61,869		$	49,542

^{(*) The number of shares and per share amounts have been retroactively restated to reflect the one for twelve (1 for 12) reverse stock split, which was effective on March 22, 2024.}


ATERIAN, INC. Consolidated Statements of Operations *(in thousands, except share and per share data)*

	Three Months Ended December 31,						Year Ended December 31,
	2023			2024			2023			2024
Net revenue	$	32,754		$	24,607		$	142,566		$	99,045
Cost of goods sold		16,045			9,000			72,281			37,550
Gross profit		16,709			15,607			70,285			61,495
Operating expenses:
Sales and distribution		20,207			13,692			81,911			55,979
Research and development		808			—			4,616			—
General and administrative		3,654			3,527			20,220			17,339
Impairment loss on intangibles		283			—			39,728			—
Total operating expenses		24,952			17,219			146,475			73,318
Operating loss		(8,243	)		(1,612	)		(76,190	)		(11,823	)
Interest expense, net		345			209			1,421			949
Change in fair value of warrant liabilities		(30	)		(194	)		(2,440	)		(924	)
Other expense, net		158			(215	)		260			61
Loss before income taxes		(8,716	)		(1,412	)		(75,431	)		(11,909	)
Benefit for income taxes		(1,009	)		(113	)		(867	)		(47	)
Net loss	$	(7,707	)	$	(1,299	)	$	(74,564	)	$	(11,862	)
Net loss per share, basic and diluted	$	(1.16	)	$	(0.18	)	$	(11.43	)	$	(1.68	)
Weighted-average number of shares outstanding, basic and diluted(*)		6,622,540			7,343,880			6,524,589			7,069,404

(*) The number of shares and per share amounts have been retroactively restated to reflect the one-for-twelve (1-for-12) reverse stock split, which was effective on March 22, 2024.


ATERIAN, INC. Consolidated Statement of Cash Flows *(in thousands, except share and per share data)*

	Year Ended December 31,
	2023			2024
OPERATING ACTIVITIES:
Net loss	$	(74,564	)	$	(11,862	)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Depreciation and amortization		3,886			1,689
(Recovery) provision for sales returns		(413	)		57
Amortization of deferred financing cost and debt discounts		429			198
Stock-based compensation		8,336			7,510
Change in deferred tax expense		(1,153	)		(5	)
Change in inventory provisions		(3,149	)		(2,738	)
Change in fair value of warrant liabilities		(2,440	)		(924	)
Impairment loss on intangibles		39,728			—
Provision for barter credits		323			—
Allowance for credit losses		85			16
Changes in assets and liabilities:
Accounts receivable		205			427
Inventory		26,426			9,378
Prepaid and other current assets		2,597			762
Accounts payable, accrued and other liabilities		(13,684	)		(2,343	)
Cash (used in) provided by operating activities		(13,388	)		2,165
INVESTING ACTIVITIES:
Purchase of fixed assets		(119	)		(42	)
Purchase of Step and Go assets		(125	)		—
Purchase of minority equity investment		—			(200	)
Cash used in investing activities		(244	)		(242	)
FINANCING ACTIVITIES:
Repayments on seller notes		(668	)		(633	)
Borrowings from MidCap credit facilities		79,806			60,866
Repayments for MidCap credit facilities		(90,190	)		(65,165	)
Insurance obligation payments		(1,042	)		(682	)
Insurance financing proceeds		986			700
Cash used in financing activities		(11,108	)		(4,914	)
Foreign currency effect on cash, cash equivalents, and restricted cash		306			(61	)
Net change in cash and restricted cash for the year		(24,434	)		(3,052	)
Cash and restricted cash at beginning of year		46,629			22,195
Cash and restricted cash at end of year	$	22,195		$	19,143
RECONCILIATION OF CASH AND RESTRICTED CASH:
Cash		20,023			17,998
Restricted cash—Prepaid and other current assets		2,043			1,015
Restricted cash—Other non-current assets		129			130
TOTAL CASH AND RESTRICTED CASH	$	22,195		$	19,143

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid for interest	$	1,718		$	1,141
Cash paid for taxes	$	94		$	152
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Non-cash consideration paid to contractors	$	321		$	620
Non-cash minority equity investment	$	—		$	50

Non-GAAP Financial Measures
We believe that our financial statements and the other financial data included in this press release have been prepared in a manner that complies, in all material respects, with generally accepted accounting principles in the U.S. (“GAAP”). However, for the reasons discussed below, we have presented certain non-GAAP measures herein.

We have presented the following non-GAAP measures to assist investors in understanding our core net operating results on an on-going basis: (i) Contribution Margin; (ii) Contribution margin as a percentage of net revenue; (iii) EBITDA (iv) Adjusted EBITDA; and (v) Adjusted EBITDA as a percentage of net revenue. These non-GAAP financial measures may also assist investors in making comparisons of our core operating results with those of other companies.

As used herein, Contribution margin represents gross profit less amortization of inventory step-up from acquisitions (included in cost of goods sold), reserve on barter credits and e-commerce platform commissions, online advertising, selling and logistics expenses (included in sales and distribution expenses). As used herein, Contribution margin as a percentage of net revenue represents Contribution margin divided by net revenue. As used herein, EBITDA represents net loss plus depreciation and amortization, interest expense, net and provision for income taxes. As used herein, Adjusted EBITDA represents EBITDA plus stock-based compensation expense, changes in fair-market value of warrant liability, impairment on intangibles, restructuring expenses, reserve on barter credits, and other expenses, net. As used herein, Adjusted EBITDA as a percentage of net revenue represents Adjusted EBITDA divided by net revenue. Contribution margin, EBITDA and Adjusted EBITDA do not represent and should not be considered as alternatives to loss from operations or net loss, as determined under GAAP.

We present Contribution margin and Contribution margin as a percentage of net revenue, as we believe each of these measures provides an additional metric to evaluate our operations and, when considered with both our GAAP results and the reconciliation to gross profit, provides useful supplemental information for investors. Specifically, Contribution margin and Contribution margin as a percentage of net revenue are two of our key metrics in running our business. All product decisions made by us, from the approval of launching a new product and to the liquidation of a product at the end of its life cycle, are measured primarily from Contribution margin and/or Contribution margin as a percentage of net revenue. Further, we believe these measures provide improved transparency to our stockholders to determine the performance of our products prior to fixed costs as opposed to referencing gross profit alone.

In the reconciliation to calculate contribution margin, we add e-commerce platform commissions, online advertising, selling and logistics expenses (“sales and distribution variable expense”), and the reserve for barter credits to gross profit to inform users of our financial statements of what our product profitability is at each period prior to fixed costs (such as sales and distribution expenses such as salaries as well as research and development expenses and general administrative expenses). By excluding these fixed costs, we believe this allows users of our financial statements to understand our products performance and allows them to measure our products performance over time.

We present EBITDA, Adjusted EBITDA and Adjusted EBITDA as a percentage of net revenue because we believe each of these measures provides an additional metric to evaluate our operations and, when considered with both our GAAP results and the reconciliation to net loss, provide useful supplemental information for investors. We use these measures with financial measures prepared in accordance with GAAP, such as sales and gross margins, to assess our historical and prospective operating performance, to provide meaningful comparisons of operating performance across periods, to enhance our understanding of our operating performance and to compare our performance to that of our peers and competitors. We believe EBITDA, Adjusted EBITDA and Adjusted EBITDA as a percentage of net revenue are useful to investors in assessing the operating performance of our business without the effect of non-cash items.

Contribution margin, Contribution margin as a percentage of net revenue, EBITDA, Adjusted EBITDA and Adjusted EBITDA as a percentage of net revenue should not be considered in isolation or as alternatives to net loss, loss from operations or any other measure of financial performance calculated and prescribed in accordance with GAAP. Neither EBITDA, Adjusted EBITDA or Adjusted EBITDA as a percentage of net revenue should be considered a measure of discretionary cash available to us to invest in the growth of our business. Our Contribution margin, Contribution margin as a percentage of net revenue, EBITDA, Adjusted EBITDA and Adjusted EBITDA as a percentage of net revenue may not be comparable to similar titled measures in other organizations because other organizations may not calculate Contribution margin, Contribution margin as a percentage of net revenue, EBITDA, Adjusted EBITDA or Adjusted EBITDA as a percentage of net revenue in the same manner as we do. Our presentation of Contribution margin and Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by the expenses that are excluded from such terms or by unusual or non-recurring items.

We recognize that EBITDA, Adjusted EBITDA and Adjusted EBITDA as a percentage of net revenue, have limitations as analytical financial measures. For example, neither EBITDA nor Adjusted EBITDA reflects:

our capital expenditures or future requirements for capital expenditures or mergers and acquisitions;
the interest expense or the cash requirements necessary to service interest expense or principal payments, associated with indebtedness;
depreciation and amortization, which are non-cash charges, although the assets being depreciated and amortized will likely have to be replaced in the future, or any cash requirements for the replacement of assets;
changes in cash requirements for our working capital needs; or
changes in fair value of warrant liabilities

Additionally, Adjusted EBITDA excludes non-cash expense for stock-based compensation, which is and is expected to remain a key element of our overall long-term incentive compensation package.

We also recognize that Contribution margin and Contribution margin as a percentage of net revenue have limitations as analytical financial measures. For example, Contribution margin does not reflect:

general and administrative expense necessary to operate our business;
research and development expenses necessary for the development, operation and support of our software platform;
the fixed costs portion of our sales and distribution expenses including stock-based compensation expense; or
changes in fair value warrant liabilities

Contribution Margin

The following table provides a reconciliation of Contribution margin to gross profit and Contribution margin as a percentage of net revenue to gross profit as a percentage of net revenue, which are the most directly comparable financial measures presented in accordance with GAAP.

	Three Months Ended December 31,								Year Ended December 31.
	2023				2024				2023				2024
	(in thousands, except percentages)
Gross Profit	$	16,709			$	15,607			$	70,285			$	61,495
Less:
Reserve on barter credits		323				—				323				—
E-commerce platform commissions, online advertising, selling and logistics expenses		(17,293	)			(10,844	)			(68,864	)			(44,553	)
Contribution margin	$	(261	)		$	4,763			$	1,744			$	16,942
Gross Profit as a percentage of net revenue		51.0		%		63.4		%		49.3		%		62.1		%
Contribution margin as a percentage of net revenue		(0.8	)	%		19.4		%		1.2		%		17.1		%

Adjusted EBITDA

	Three Months Ended December 31,								Year Ended December 31,
	2023				2024				2023				2024
	(in thousands, except percentages)
Net loss	$	(7,707	)		$	(1,299	)		$	(74,564	)		$	(11,862	)
Add:
Benefit for income taxes		(1,009	)			(113	)			(867	)			(47	)
Interest expense, net		345				209				1,421				949
Depreciation and amortization		469				410				3,886				1,689
EBITDA		(7,902	)			(793	)			(70,124	)			(9,271	)
Other expense, net		158				(215	)			260				61
Impairment loss on intangibles		283				—				39,728				—
Change in fair market value of warrant liabilities		(30	)			(194	)			(2,440	)			(924	)
Reserve on barter credits		323				—				323				—
Restructuring expense		—				—				1,633				565
Stock-based compensation expense		1,564				1,116				8,336				7,510
Adjusted EBITDA	$	(5,604	)		$	(86	)		$	(22,284	)		$	(2,059	)
Net loss as a percentage of net revenue		(23.5	)	%		(5.3	)	%		(52.3	)	%		(12.0	)	%
Adjusted EBITDA as a percentage of net revenue		(17.1	)	%		(0.3	)	%		(15.6	)	%		(2.1	)	%

Each of our products typically goes through the Launch phase and depending on its level of success is moved to one of the other phases as further described below:

i. Launch phase: During this phase, we leverage our technology to target opportunities identified using AIMEE (Artificial Intelligence Marketplace e-Commerce Engine) and other sources. This phase also includes revenue from new product variations and relaunches. During this period of time, due to the combination of discounts and investment in marketing, our net margin for a product could be as low as approximately negative 35%. Net margin is calculated by taking net revenue less the cost of goods sold, less fulfillment, online advertising and selling expenses. These primarily reflect the estimated variable costs related to the sale of a product.

ii Sustain phase: Our goal is for every product we launch to enter the sustain phase and become profitable, with a target of positive 15% net margin for most products, within approximately three months of launch on average. Net margin primarily reflects a combination of manual and automated adjustments in price and marketing spend.

iii. Liquidate phase: If a product does not enter the sustain phase or if the customer satisfaction of the product (i.e., ratings) is not satisfactory, then it will go to the liquidate phase and we will sell through the remaining inventory. Products can also be liquidated as part of inventory normalization especially when steep discounts are required.

The following tables break out our fourth quarter and full year 2023 and 2024 results of operations by our product phases (in thousands):

	Three months ended December 31, 2023
	Sustain		Launch		Liquidation/ Other		Fixed Costs		Stock Based Compensation		Total
Net revenue	$	25,175	$	390	$	7,189	$	—	$	—	$	32,754
Cost of goods sold		10,457		114		5,474		—		—		16,045
Gross profit		14,718		276		1,715		—		—		16,709
Operating expenses:
Sales and distribution expenses		12,973		263		4,056		2,567		348		20,207
Research and development		—		—		—		528		280		808
General and administrative		—		—		—		2,717		937		3,654
Impairment loss on intangibles		—		—		—		283		—		283

	Three months ended December 31, 2024
	Sustain		Launch		Liquidation/ Other		Fixed Costs		Stock Based Compensation		Total
Net revenue	$	23,332	$	347	$	928	$	—	$	—	$	24,607
Cost of goods sold		8,536		143		321		—		—		9,000
Gross profit		14,796		204		607		—		—		15,607
Operating expenses:
Sales and distribution expenses		9,965		309		570		2,767		81		13,692
General and administrative		—		—		—		2,492		1,035		3,527

	Year-ended December 31, 2023
	Sustain		Launch		Liquidation/ Other		Fixed Costs		Stock Based Compensation		Total
Net revenue	$	114,919	$	959	$	26,688	$	—	$	—	$	142,566
Cost of goods sold		53,139		455		18,687		—		—		72,281
Gross profit		61,780		504		8,001		—		—		70,285
Operating expenses:
Sales and distribution expenses		53,442		603		14,820		10,607		2,439		81,911
Research and development		—		—		—		3,202		1,414		4,616
General and administrative		—		—		—		15,737		4,483		20,220
Impairment loss on intangibles		—		—		—		39,728		—		39,728

	Year-ended December 31, 2024
	Sustain		Launch		Liquidation/ Other		Fixed Costs		Stock Based Compensation		Total
Net revenue	$	92,542	$	1,829	$	4,674	$	—	$	—	$	99,045
Cost of goods sold		35,012		651		1,887		—		—		37,550
Gross profit		57,530		1,178		2,787		—		—		61,495
Operating expenses:
Sales and distribution expenses		40,353		1,087		3,113		9,643		1,783		55,979
General and administrative		—		—		—		11,612		5,727		17,339

MIL-OSI Security: Former Long Island Business Owner Charged with Orchestrating $22 Million Health Care Fraud, Kickback and Money Laundering Scheme

Source: Office of United States Attorneys

Defendant Took Advantage of Elderly Immigrants from the Former Soviet Union to Solicit Bribes from Health Care Providers and Defraud Medicare of Millions of Dollars

Earlier today, at the federal courthouse in Brooklyn, an indictment was unsealed charging Oleg Beretsky with conspiring to commit health care fraud, violating the federal Anti-Kickback Statute, conspiring to violate the Anti-Kickback Statute and money laundering conspiracy. Beretsky was arrested this morning in Naples, Florida. He will be arraigned in the Eastern District of New York at a later date.

John J. Durham, United States Attorney for the Eastern District of New York, Naomi Gruchacz, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), Michael Alfonso, Acting Special Agent in Charge, Homeland Security Investigations, New York (HSI New York), and Harry T. Chavis, Jr., Special Agent in Charge, Internal Revenue Service Criminal Investigation, New York (IRS-CI), announced the arrest and charges.

“As alleged, elderly individuals trusted the defendant to help them with their health care decisions. Rather than look out for the interests of some of the most vulnerable members of our community, he sold access to those who trusted him to the highest bidder,” stated United States Attorney Durham. “The defendant compounded his crimes by encouraging doctors and health care providers who became part of his scheme to cheat Medicare by billing for work that was not needed or never performed. My Office is committed to protecting both patients and taxpayers from this terrible form of greed.”

Mr. Durham expressed his appreciation to HSI’s Fort Myers, Florida, office and the New York City Police Department for their assistance on the case.

“Violations of the Anti-Kickback Statute can divert much-needed federal health care program funds and corrupt the medical decision-making process,” stated HHS-OIG Special Agent in Charge Gruchacz. “HHS-OIG works diligently with our law enforcement partners to investigate allegations that owners and other providers engage in fraud schemes that prioritize greed over the provision of appropriate health care services to patients.”

“The defendant and his co-conspirators are accused of pocketing more than $12 million while exploiting the unknowing, innocent public, including victims from immigrant communities,” stated HSI New York Special Agent in Charge Alfonso. “As alleged, he took advantage of people with whom he had forged relationships — only to manipulate them into using certain doctors and services for his lucrative benefit. HSI New York’s El Dorado Task Force is unmatched in its ability to draw from the strengths and equities of all partners involved, with one unified goal being the safety and security of Americans. I commend our partners, including HHS-OIG, IRS-CI, NYPD and HSI’s Fort Meyer’s personnel, for placing the wellbeing of the public above all else.”

“Millions of dollars were stolen from the American benefits system, and Oleg Beretsky is charged with the crime. He’s accused of taking advantage of a vulnerable population and funneling stolen Medicare money into his and his co-conspirators’ pockets. IRS-CI is charged with securing trust in the American financial system and actively investigates anyone looking to make a quick buck by stealing from the American public,” stated IRS-CI Special Agent in Charge Chavis.

As alleged in court filings, from January 2017 to April 2024, Beretsky and co-conspirators engaged in a health care fraud, kickback and money laundering scheme. Beretsky was the owner of Obest, Inc., a company in Plainview, New York, that purported to provide health care professionals with billing, consulting and support services. In reality, Obest’s principal business consisted of referring elderly Medicare patients to doctors and other health care professionals in exchange for kickbacks and bribes. Many of these patients were immigrants from the former Soviet Union, who Beretsky identified through an employee of a nonprofit social service agency that provided housing and other services to senior citizens in Brooklyn and Queens. Beretsky cultivated relationships with many of these patients, which he used to gain control over decisions regarding their health care providers. Beretsky then used that control to ensure that only doctors and other providers—including social workers, pain specialists and diagnostic companies—who were willing to pay him would have access to the patients. On at least one occasion, Beretsky threatened a patient who wanted to continue seeing a provider who had stopped paying illegal kickbacks to the defendant.

The fee charged by Beretsky was typically based either on how many patients Beretsky referred to the provider or how much Medicare reimbursed the provider for services purportedly rendered to the patients. To generate more fees for himself and his co-conspirators, Beretsky often encouraged or directed providers to bill Medicare for patients who did not need the services those providers rendered, and in some cases, services that were not rendered at all. In total, doctors and providers who participated in Beretsky’s scheme billed more than $22 million in false and fraudulent claims to Medicare. Of that more than $22 million, Medicare paid more than $12.4 million in claims, which was distributed to Beretsky and his co-conspirators. To hide the illegal source of funds Beretsky received from the conspiracy, Beretsky frequently directed co-conspirators to pay his relatives in cash and transferred money to multiple accounts held in the names of his family members.

The charges in the indictment are allegations and the defendant is presumed innocent unless and until proven guilty. If convicted of the charges, Beretsky faces up to up to 20 years in prison on the money laundering conspiracy count; up to 10 years each on the health care fraud conspiracy and kickback counts; and up to five years on the kickback conspiracy count.

The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorney Joshua B. Dugan is in charge of the prosecution with the assistance of Paralegal Specialists Liam McNett and Timothy Migliaro.

The Defendant:

OLEG BERETSKY
Age: 67
Naples, Florida

E.D.N.Y. Docket No. 25-CR-91 (RPK)

MIL Security OSI –

MIL-OSI: Fast Company Names Huntress Among 50 Most Innovative Companies for Democratizing Enterprise Security

Source: GlobeNewswire (MIL-OSI)

COLUMBIA, Md., March 18, 2025 (GLOBE NEWSWIRE) — Huntress has been named to Fast Company’s prestigious Most Innovative Companies list for 2025, earning recognition for democratizing cybersecurity previously reserved for Fortune 500 companies. As cybercrime costs approach a staggering $10.5 trillion annually, Huntress is challenging the status quo by making enterprise-grade protection accessible to businesses of all sizes.

“While industry giants focus on the Fortune 500, we’re protecting the backbone of the economy,” said Kyle Hanslovan, CEO of Huntress. “We set out from the start to protect everyone, and our 24/7 security team, empowered by our technology, catches threats every day that can devastate a business.”

Fast Company sifts through thousands of applications to find standout companies that are demonstrating leadership and making an impact on the world. Huntress earned its overall ranking for democratizing cybersecurity for all and the number one spot in the security category for the newest additions to its managed cybersecurity platform:

Huntress Managed Security Information and Event Management (SIEM): Traditional SIEMs are notorious for overwhelming alerts, operational complexity, and high costs. Huntress Managed SIEM simplifies data and event monitoring by using and retaining only what’s needed to prioritize actionable insights, streamline compliance needs, and remove blockers to successful use.
Huntress Managed Identity Threat Detection and Response (ITDR): Modern attackers increasingly target identities as entry points. ITDR addresses this growing threat vector by proactively monitoring and protecting against credential-based attacks and privilege escalations, locking out attackers before they cause damage.

What separates Huntress is its “One Team Advantage”—every product is built, owned, and operated by one team, enabling the company to innovate and adapt as quickly as the threat actors do.

“The cybersecurity industry has failed millions of businesses by making protection too complex and expensive,” added Hanslovan. “We’re proving that world-class security doesn’t have to be a luxury.”

Huntress protects organizations across industries with its 24/7 Security Operations Center, achieving a false-positive rate under 1% – a metric that outperforms many enterprise solutions costing significantly more.

Additional resources:

Join the hunt: visit Huntress’ career page.
Learn how Huntress protects endpoints, identities, and more with managed detection, investigation, and response.
Read the Huntress blog to learn from our leading experts.

About Huntress
Huntress is the enterprise-grade, people-powered cybersecurity solution for all businesses, not just the 1%. With fully owned technology developed by and for its industry-defining team of security analysts, engineers, and researchers, Huntress elevates underresourced tech teams whether they work within outsourced IT environments or in-house IT and security teams.

The 24/7 industry-leading Huntress Security Operations Center (SOC) covers cyber threats for outsourced IT and in-house teams through remediation with a false-positive rate of less than 1%. With a mission to break down barriers to enterprise-level security and always give back more than it takes, Huntress is often the first to respond to major hacks and threats while protecting its partners and shares tradecraft analysis and threat advisories with the community as they happen.

As long as hackers keep hacking, Huntress keeps hunting. Join the hunt at www.huntress.com and follow us on X, Instagram, Facebook, and LinkedIn.

Huntress Contact:
press@huntresslabs.com

MIL-OSI: Bitcoin Depot Reports Fourth Quarter and Full Year 2024 Financial Results

Source: GlobeNewswire (MIL-OSI)

Q4 Revenue of $136.8 Million Compared to $148.4 Million in the Prior Year Quarter

Q4 Operating Expenses Down 16% Year-Over-Year to $15.0 Million

Q4 Net Income up Significantly to $5.4 Million Compared to a Net Loss of $1.7 Million in the Prior Year Quarter

Q4 Adjusted Gross Profit up 18% Year-Over-Year to $25.4 Million

Q4 Adjusted EBITDA up 34% Year-Over-Year to $12.0 Million

ATLANTA, March 18, 2025 (GLOBE NEWSWIRE) — Bitcoin Depot Inc. (“Bitcoin Depot” or the “Company”), a U.S.-based Bitcoin ATM operator and leading fintech company, today reported financial results for the fourth quarter and full year ended December 31, 2024. Bitcoin Depot will host a conference call and webcast at 10:00 a.m. ET today. An earnings presentation and link to the webcast will be made available at ir.bitcoindepot.com.

“As we highlighted in our fourth-quarter pre-announcement, 2024 ended on a strong note, driven by sequential revenue growth and substantial improvements in adjusted EBITDA, both sequentially and year-over-year,” said Brandon Mintz, CEO and Founder of Bitcoin Depot. “In the fourth quarter, we made significant progress in expanding our Bitcoin ATM network and optimizing existing machines to enhance profitability — and the results speak for themselves.

“Looking ahead, we are confident that the optimization efforts we implemented throughout 2024 will begin to positively impact our financial performance as we move through 2025. With our aggressive international and domestic kiosk expansion strategy, we anticipate that 2025 will mark a strong return to growth for the business. As part of this, we are reintroducing financial guidance, projecting robust growth in the first quarter. Additionally, we remain committed to leveraging our strong cash flow to drive shareholder value initiatives, including the potential for a cash dividend. We have also continued to strengthen our Bitcoin treasury holdings, recently increasing our total to 94 BTC, reflecting our confidence in Bitcoin as a valuable financial asset and an integral part of our business model.”

Fourth Quarter 2024 Financial Results

Revenue in the fourth quarter of 2024 was $136.8 million compared to $148.4 million in the fourth quarter of 2023. This decline was driven by the impact of unfavorable legislation that was passed in California that went into effect in January 2024, along with the Company’s continued process of relocating underperforming kiosks to optimize fleet profitability.

Total operating expenses declined 16% to $15.0 million for the fourth quarter of 2024 compared to $17.8 million for the fourth quarter of 2023 due to the costs of going public in 2023 that did not recur in 2024.

Net income for the fourth quarter of 2024 increased significantly to $5.4 million compared to a net loss of $1.7 million for the fourth quarter of 2023. The increase was due to lower depreciation and amortization and lower operating expenses in 2024.

Adjusted gross profit, a non-GAAP measure, in the third quarter of 2024 increased 18% to $25.4 million from $21.6 million for the fourth quarter of 2023. Adjusted gross profit margin, a non-GAAP measure, in the fourth quarter of 2024 increased approximately 400 basis points to 18.6% compared to 14.5% in the fourth quarter of 2023. Please see “Explanation and Reconciliation of Non-GAAP Financial Measures” below.

Adjusted EBITDA, a non-GAAP measure, in the fourth quarter of 2024 increased 34% to $12.0 million compared to $9.0 million for the fourth quarter of 2023. The increase was primarily due to the higher net income. Please see “Explanation and Reconciliation of Non-GAAP Financial Measures” below.

Full Year 2024 Financial Results

Revenue in 2024 was $573.7 million from $689.0 million in 2023. This decline was largely driven by the impact of unfavorable legislation that was passed in California that went into effect in January 2024, along with the Company’s continued process of relocating underperforming kiosks in order to optimize fleet profitability.

Total operating expenses declined 5% to $67.2 million compared to $70.6 million in 2023 due to the costs of going public in 2023 that did not recur in 2024 as well as other cost saving measures.

Net income in 2024 increased by 432% to $7.8 million compared to $1.5 million in 2023. The increase was primarily due to expenses with going public in 2023 that did not recur in 2024 along with other expense reductions.

Adjusted gross profit, a non-GAAP measure, in 2024 was $91.4 million compared to $101.0 million in 2023. The adjusted gross profit margin, a non-GAAP measure, in 2024 increased 120 basis points to 15.9% compared to 14.7% in 2023. Please see “Explanation and Reconciliation of Non-GAAP Financial Measures” below.

Adjusted EBITDA, a non-GAAP measure, in 2024 was $38.7 million compared to $56.3 million in 2023. The decline was due to the lower revenue. Please see “Explanation and Reconciliation of Non-GAAP Financial Measures” below.

Cash, cash equivalents, and cryptocurrencies were $31.0 million as of the end of 2024 compared to $30.5 million at the end of 2023.

Q1 2025 Outlook

Q1 2025 is off to a very strong start as we continue to see growth from our relocation strategy. We anticipate Q1 revenues to be between $151 million and $154 million which would represent growth of between 9% and 11% compared to Q1 2024.

We are projecting adjusted EBITDA for Q1 2025 to be between $12 million and $14 million which would represent growth of over 200% compared to Q1 of 2024.

Conference Call

Bitcoin Depot will hold a conference call at 10:00 a.m. Eastern time (7:00 a.m. Pacific time) today to discuss its financial results for the fourth quarter and full year ended December 31, 2024.

Call Date: Tuesday, March 18, 2025
Time: 10:00 a.m. Eastern time (7:00 a.m. Pacific time)

Phone Instructions
U.S. dial-in: 646-968-2525
International dial-in: 888-596-4144
Conference ID: 8224936

Webcast Instructions
Webcast link: https://edge.media-server.com/mmc/p/8kgtbeme

A replay of the call will be available beginning after 2:00 p.m. Eastern time through March 25, 2025.

U.S. & Canada replay number: 800-770-2030
U.S. toll number: 609-800-9909
Conference ID: 8224936

If you have any difficulty connecting with the conference call, please contact Bitcoin Depot’s investor relations team at 1-949-574-3860.

About Bitcoin Depot

Bitcoin Depot Inc. (Nasdaq: BTM) was founded in 2016 with the mission to connect those who prefer to use cash to the broader, digital financial system. Bitcoin Depot provides its users with simple, efficient and intuitive means of converting cash into Bitcoin, which users can deploy in the payments, spending and investing space. Users can convert cash to bitcoin at Bitcoin Depot kiosks in 48 states and at thousands of name-brand retail locations in 29 states through its BDCheckout product. The Company has the largest market share in North America with over 8,400 kiosk locations as of February 25, 2025. Learn more at www.bitcoindepot.com.

Cautionary Statement Regarding Forward-Looking Statements

This press release and any oral statements made in connection herewith include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended. Forward-looking statements are any statements other than statements of historical fact, and include, but are not limited to, statements regarding the expectations of plans, business strategies, objectives and growth and anticipated financial and operational performance, including our growth strategy and ability to increase deployment of our products and services, our ability to strengthen our financial profile, and worldwide growth in the adoption and use of cryptocurrencies. These forward-looking statements are based on management’s current beliefs, based on currently available information, as to the outcome and timing of future events. Forward-looking statements are often identified by words such as “anticipate,” “appears,” “approximately,” “believe,” “continue,” “could,” “designed,” “effect,” “estimate,” “evaluate,” “expect,” “forecast,” “goal,” “initiative,” “intend,” “may,” “objective,” “outlook,“ ”plan,“ ”potential,“ ”priorities,“ ”project,“ ”pursue,“ ”seek,“ ”should,“ ”target,“ ”when,“ ”will,“ ”would,” or the negative of any of those words or similar expressions that predict or indicate future events or trends or that are not statements of historical matters, although not all forward-looking statements contain such identifying words. In making these statements, we rely upon assumptions and analysis based on our experience and perception of historical trends, current conditions, and expected future developments, as well as other factors we consider appropriate under the circumstances. We believe these judgments are reasonable, but these statements are not guarantees of any future events or financial results. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond our control.

These forward-looking statements are subject to a number of risks and uncertainties, including changes in domestic and foreign business, market, financial, political and legal conditions; failure to realize the anticipated benefits of the business combination; risks relating to the uncertainty of our projected financial information; future global, regional or local economic and market conditions; the development, effects and enforcement of laws and regulations; our ability to manage future growth; our ability to develop new products and services, bring them to market in a timely manner and make enhancements to our platform; the effects of competition on our future business; our ability to issue equity or equity-linked securities; the outcome of any potential litigation, government and regulatory proceedings, investigations and inquiries; and those factors described or referenced in filings with the Securities and Exchange Commission. If any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that we do not presently know or that we currently believe are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect our expectations, plans or forecasts of future events and views as of the date of this press release. We anticipate that subsequent events and developments will cause our assessments to change.

We caution readers not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly or otherwise revise any forward-looking statements, whether as a result of new information, future events, or other factors that affect the subject of these statements, except where we are expressly required to do so by law. All written and oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary statement.


BITCOIN DEPOT INC. CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share amounts)

	As of December 31,
	2024			2023
Assets
Current:
Cash and cash equivalents	$	29,472		$	29,759
Cryptocurrencies		1,510			712
Accounts receivable		275			245
Prepaid expenses and other current assets		3,076			3,514
Total current assets		34,333			34,230
Property and equipment:
Furniture and fixtures		635			635
Leasehold improvements		172			172
Kiosk machines – owned		36,831			24,222
Kiosk machines – leased		10,367			20,524
Total property and equipment		48,005			45,553
Less: accumulated depreciation		(21,158	)		(20,699	)
Total property and equipment, net		26,847			24,854
Intangible assets, net		2,320			3,836
Goodwill		8,717			8,717
Operating lease right-of-use assets, net		2,595			484
Deposits		734			412
Deferred tax assets		4,558			1,804
Total assets	$	80,104		$	74,337


BITCOIN DEPOT INC. CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share amounts)

	As of December 31,
	2024			2023
Liabilities and Stockholders’ (Deficit) Equity
Current:
Accounts payable	$	11,557		$	8,337
Accrued expenses and other current liabilities		14,260			18,505
Notes payable		6,022			3,985
Income taxes payable		2,207			2,484
Deferred revenue		20			297
Operating lease liabilities, current portion		858			279
Current installments of obligations under finance leases		3,446			6,801
Other non-income tax payable		2,259			2,297
Total current liabilities		40,629			42,985
Long-term liabilities
Notes payable, non-current		49,457			17,101
Operating lease liabilities, non-current		1,774			319
Obligations under finance leases, non-current		1,950			2,848
Deferred income tax, net		604			846
Tax receivable agreement liability due to related party		2,176			865
Total Liabilities		96,590			64,964
Commitments and Contingencies (Note 24)
Stockholders’ (Deficit) Equity
Series A Preferred Stock, $0.0001 par value; 50,000,000 authorized, 1,733,884 and 3,125,000 shares issued and outstanding, at December 31, 2024 and 2023, respectively		—			—
Class A common stock, $0.0001 par value; 800,000,000 authorized, 19,263,164 and 13,602,691 shares issued, and 19,072,544 and 13,482,047 shares outstanding at December 31, 2024 and 2023, respectively		1			1
Class B common stock, $0.0001 par value; 20,000,000 authorized, no shares issued and outstanding at December 31, 2024 and 2023, respectively		—			—
Class E common stock, $0.0001 par value; 2,250,000 authorized, 1,075,761 shares issued and outstanding at December 31, 2024 and 2023, respectively		—			—
Class M common stock, $0.0001 par value; 300,000,000 authorized, no shares issued and outstanding at December 31, 2024 and 2023, respectively		—			—
Class O common stock, $0.0001 par value; 800,000,000 authorized, no shares issued and outstanding at December 31, 2024 and 2023, respectively		—			—
Class V common stock, $0.0001 par value; 300,000,000 authorized, 41,193,024 and 44,100,000 shares issued and outstanding at December 31, 2024 and 2023, respectively		4			4
Treasury stock		(437	)		(279	)
Additional paid-in capital		21,491			17,326
Accumulated deficit		(44,349	)		(32,663	)
Accumulated other comprehensive loss		(342	)		(203	)
Total Stockholders’ (Deficit) Attributable to Bitcoin Depot Inc.		(23,632	)		(15,814	)
Equity attributable to non-controlling interests		7,146			25,187
Total Stockholders’ (Deficit) Equity		(16,486	)		9,373
Total Liabilities and Stockholders’ (Deficit) Equity	$	80,104		$	74,337


BITCOIN DEPOT INC. CONSOLIDATED STATEMENTS OF (LOSS) INCOME AND COMPREHENSIVE (LOSS) INCOME (UNAUDITED) (in thousands, except share and per share amounts)

	Year ended December 31,						Three Months Ended December 31,
	2024			2023			2024			2023
Revenue	$	573,703		$	688,967		$	136,827		$	148,406
Cost of revenue (excluding depreciation and amortization)		482,263			587,938			111,415			126,851
Operating expenses:								—			—
Selling, general, and administrative		57,158			57,770			13,096			14,525
Depreciation and amortization		10,072			12,788			1,888			3,234
Total operating expenses		67,230			70,558			14,984			17,759
Income from operations		24,210			30,471			10,428			3,796
Other (expense) income:								–			–
Interest (expense)		(14,199	)		(11,926	)		(3,468	)		(1,806	)
Other (expense) income		406			(16,737	)		263			(2,713	)
Loss on foreign currency transactions		(465	)		(289	)		(171	)		76
Total other (expense), net		(14,258	)		(28,952	)		(3,376	)		(4,443	)
Income before provision for income taxes and non-controlling interest		9,952			1,519			7,052			(647	)
Income tax (expense)		(2,138	)		(49	)		(1,659	)		(1,026	)
Net income	$	7,814		$	1,470		$	5,393		$	(1,673	)
Net income attributable to Legacy Bitcoin Depot unit holders		—			12,906			—			—
Net income attributable to non-controlling interest		19,500			14,666			12,041			6,635
Net (loss) attributable to Bitcoin Depot Inc.	$	(11,686	)	$	(26,102	)	$	(6,648	)	$	(8,308	)
Other comprehensive income (loss), net of tax								—			—
Net income		7,814			1,470			5,393			(1,673	)
Foreign currency translation adjustments		34			(4	)		35			(70	)
Total comprehensive income		7,848			1,466			5,428			(1,743	)
Comprehensive income attributable to Legacy Bitcoin Depot unit holders		—			12,885			—			—
Comprehensive income attributable to non-controlling interest		19,500			14,683			12,041			6,565
Comprehensive (loss) attributable to Bitcoin Depot Inc.	$	(11,652	)	$	(26,102	)	$	(6,613	)	$	(8,308	)

Explanation and Reconciliation of Non-GAAP Financial Measures

Bitcoin Depot reports its financial results in accordance with accounting principles generally accepted in the United States of America (“GAAP”). This press release includes both historical and projected Adjusted EBITDA, Adjusted Gross Profit, and certain ratios and other metrics derived therefrom such as Adjusted EBITDA margin and Adjusted Gross Profit margin, which are not prepared in accordance with GAAP.

Bitcoin Depot defines Adjusted EBITDA as net income before interest expense, income tax expense, depreciation and amortization, non-recurring expenses, share-based compensation, expenses related to the PIPE financing and miscellaneous cost adjustments. Such items are excluded from Adjusted EBITDA because these items are non-cash in nature, or because the amount and timing of these items is unpredictable, not driven by core results of operations and renders comparisons with prior periods and competitors less meaningful. In addition, Bitcoin Depot defines Adjusted Gross Profit (a non-GAAP financial measure) as revenue less cost of revenue (excluding depreciation and amortization) and depreciation and amortization adjusted to add back depreciation and amortization. Bitcoin Depot believes Adjusted EBITDA and Adjusted Gross Profit each provide useful information to investors and others in understanding and evaluating Bitcoin Depot’s results of operations, as well as provide a useful measure for period-to-period comparisons of Bitcoin Depot’s business performance. Adjusted EBITDA and Adjusted Gross Profit are each key measurements used internally by management to make operating decisions, including those related to operating expenses, evaluate performance and perform strategic and financial planning. However, you should be aware that Adjusted EBITDA and Adjusted Gross Profit are not measures of financial performance calculated in accordance with GAAP and may exclude items that are significant in understanding and assessing Bitcoin Depot’s financial results, and further, that Bitcoin Depot may incur future expenses similar to those excluded when calculating these measures. Bitcoin Depot primarily relies on GAAP results and uses both Adjusted EBITDA and Adjusted Gross Profit on a supplemental basis. Neither Adjusted EBITDA or Adjusted Gross Profit should be considered in isolation from, or as an alternative to, net income, cash flows from operations or other measures of profitability, liquidity or performance under GAAP and may not be indicative of Bitcoin Depot’s historical or future operating results. Bitcoin Depot’s computation of both Adjusted EBITDA and Adjusted Gross Profit may not be comparable to other similarly titled measures computed by other companies because not all companies calculate such measures in the same fashion. As such, undue reliance should not be placed on such measures.

Due to the high variability and difficulty in making accurate forecasts and projections of some of the information excluded from the projections of Adjusted EBITDA, together with some of the excluded information not being ascertainable or accessible, Bitcoin Depot is unable to quantify certain amounts that would be required to be included in the most directly comparable GAAP financial measures without unreasonable effort. Consequently, no disclosure of estimated comparable GAAP measures is included and no reconciliation of the forward-looking non-GAAP financial measures is included.

The following table presents a reconciliation of Net (loss) income to Adjusted EBITDA for the periods indicated:


BITCOIN DEPOT INC. RECONCILIATION OF NET (LOSS) INCOME TO ADJUSTED EBITDA (UNAUDITED)

	Year Ended December 31,						Three Months Ended December 31,
*(in thousands)*	2024			2023			2024			2023
Net income (loss)	$	7,814		$	1,470		$	5,393		$	(1,673	)
Adjustments:
Interest expense		14,199			11,926			3,468			1,806
Income tax (benefit) expense		2,138			49			1,659			1,026
Depreciation and amortization		10,072			12,788			1,888			3,234
Expense related to the PIPE transaction (1)		—			14,896			—			2,615
Non-recurring expenses (2)		437			9,298			(767	)		1,634
Share-based compensation		3,400			2,524			363			1,198
Special bonus (3)		675			3,040			—			(875	)
Expenses associated with the termination of the phantom equity participation plan		—			350			—			—
Adjusted EBITDA	$	38,735		$	56,341		$	12,004		$	8,965
Adjusted EBITDA margin (4)		6.8	%		8.2	%		8.8	%		7.8	%

(1) Amounts include the recognition of a non-cash expense of $13.9 million related to the PIPE transaction for the year ended December 31, 2023, entered into as of close of the Merger on June 30, 2023. (2) Comprised of non-recurring professional service fees incurred by the Company related to the close of the Transaction. (3) Amount includes (A) Transaction bonus and related taxes to employees of approximately $1.4 million and (B) Founder Transaction bonus as a result of close of the Merger, of approximately $1.6 million, recognized as share-based compensation, for the year ended December 31, 2023. (4) Adjusted EBITDA margin is defined as Adjusted EBITDA divided by revenue. The Company uses this measure to evaluate its overall profitability.

The following table presents a reconciliation of revenue to Adjusted Gross Profit for the periods indicated:


BITCOIN DEPOT INC. RECONCILIATION OF REVENUE TO ADJUSTED GROSS PROFIT (UNAUDITED)

	Year Ended December 31,						Three Months Ended December 31,
*(in thousands)*	2024			2023			2024			2023
Revenue	$	573,703		$	688,967		$	136,827		$	148,406
Cost of revenue (excluding depreciation and amortization)		(482,263	)		(587,938	)		(111,415	)		(126,851	)
Depreciation and amortization excluded from cost of revenue		(9,984	)		(12,455	)		(1,894	)		(2,901	)
Gross profit	$	81,456		$	88,574		$	23,518		$	18,654
Adjustments:
Depreciation and amortization excluded from cost of revenue	$	9,984		$	12,455		$	1,894		$	2,901
Adjusted gross profit	$	91,440		$	101,029		$	25,412		$	21,555
Gross profit margin (1)		14.2	%		12.9	%		17	%		13	%
Adjusted gross profit margin (1)		15.9	%		14.7	%		19	%		15	%

(1) Calculated as a percentage of revenue.

Contacts:

Investors
Cody Slach,
Gateway Group, Inc.
949-574-3860
BTM@gateway-grp.com

Media
Zach Kadletz, Brenlyn Motlagh, Ryan Deloney
Gateway Group, Inc.
949-574-3860
BTM@gateway-grp.com

MIL-OSI: KE Holdings Inc. Announces Fourth Quarter and Fiscal Year 2024 Unaudited Financial Results and a Final Cash Dividend

Source: GlobeNewswire (MIL-OSI)

BEIJING, March 18, 2025 (GLOBE NEWSWIRE) — KE Holdings Inc. (“Beike” or the “Company”) (NYSE: BEKE and HKEX: 2423), a leading integrated online and offline platform for housing transactions and services, today announced its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2024, and also announced a final cash dividend.

Business and Financial Highlights for the Fourth Quarter and Fiscal Year 2024

Gross transaction value (GTV)¹ in 2024 was RMB3,349.4 billion (US$458.9 billion), an increase of 6.6% year-over-year. GTV of existing home transactions was RMB2,246.5 billion (US$307.8 billion), an increase of 10.8% year-over-year. GTV of new home transactions was RMB970.0 billion (US$132.9 billion), a decrease of 3.3% year-over-year. GTV of home renovation and furnishing was RMB16.9 billion (US$2.3 billion), an increase of 27.3% year-over-year. GTV of emerging and other services was RMB116.0 billion (US$15.9 billion), an increase of 17.6% year-over-year.
In the fourth quarter of 2024, GTV was RMB1,143.8 billion (US$156.7 billion), an increase of 55.5% year-over-year. GTV of existing home transactions was RMB744.8 billion (US$102.0 billion), an increase of 59.1% year-over-year. GTV of new home transactions was RMB355.3 billion (US$48.7 billion), an increase of 49.3% year-over-year. GTV of home renovation and furnishing was RMB5.3 billion (US$0.7 billion), an increase of 34.7% year-over-year. GTV of emerging and other services was RMB38.3 billion (US$5.3 billion), an increase of 50.0% year-over-year.
Net revenues in 2024 were RMB93.5 billion (US$12.8 billion), an increase of 20.2% year-over-year.
In the fourth quarter of 2024, net revenues were RMB31.1 billion (US$4.3 billion), an increase of 54.1% year-over-year.
Net income in 2024 was RMB4,078 million (US$559 million), a decrease of 30.8% year-over-year. Adjusted net income²in 2024 was RMB7,211 million (US$988 million), a decrease of 26.4% year-over-year.
In the fourth quarter of 2024, net income was RMB577 million (US$79 million), a decrease of 13.9% year-over-year. Adjusted net income was RMB1,344 million (US$184 million), a decrease of 21.6% year-over-year.
Number of stores was 51,573 as of December 31, 2024, a 17.7% increase from one year ago. Number of active stores³ was 49,693 as of December 31, 2024, an 18.3% increase from one year ago.
Number of agents was 499,937 as of December 31, 2024, a 16.9% increase from one year ago. Number of active agents⁴ was 445,271 as of December 31, 2024, a 12.1% increase from one year ago.
Mobile monthly active users (MAU)⁵ averaged 43.2 million in the fourth quarter of 2024, relatively flat compared to 43.2 million in the same period of 2023.

Mr. Stanley Yongdong Peng, Chairman of the Board and Chief Executive Officer of Beike, commented, “in 2024, China’s real estate industry is accelerating towards an advanced stage, with customer demand shifting towards reducing decision-making risks and pursuing higher living quality. We empower service providers with technology, enabling optimal decision-making and driving the industry’s leap toward higher service efficiency.”

“Under the strategy of active growth and ecosystem optimization, we achieved significant growth in several key metrics in 2024. The number of active stores on the platform reached nearly 49,700, an 18.3% increase year-on-year, while the number of active agents surpassed 445,000, a 12.1% increase year-on-year. The total GTV was RMB3,349.4 billion, with net revenues hitting a historic high of RMB93.5 billion, a 20.2% increase year-on-year. GTV of existing home transactions grew 10.8% year-on-year, while net revenues from new home transaction services increased by 10.1% year-on-year. The home renovation and furnishing services saw continuous improvement in scale and delivery capability, achieving net revenues of RMB14.8 billion, a 36.1% year-on-year increase. The home rental services managed over 430,000 units by the end of 2024, generating net revenues of RMB14.3 billion, a 135.0% year-on-year increase, with refined operations improving customer experience. Our Beihaojia business explored driving product strength and reduce risks in the new home industry through the C2M (customer to manufacturing) model.”

“Looking ahead, we remain committed to our strategic direction of becoming ‘more technology-driven and more human-centric.’ AI-powered technology will enable deeper insights into personalized customer needs and redefine the boundaries of service providers’ capabilities, while a human-centered approach will highlight the value of service. We believe that the integration of technology and human touch will drive a step-change in consumer experience and service efficiency, unlocking new possibilities for the residential services industry,” concluded Mr. Peng.

Mr. Tao Xu, Executive Director and Chief Financial Officer of Beike, added, “in 2024, both the existing and new home markets saw a significant recovery following the stimulus policies introduced in September. The total volume of existing home transactions saw year-on-year growth in 2024, and structurally, the proportion of existing home transactions within the overall real estate market further increased.

Facing market opportunities, we continued to make breakthroughs in scale in 2024. Our full-year net revenues reached RMB93.5 billion, up 20.2% year-over-year. Net revenues from existing and new home transaction services both grew year-over-year. Net revenues from non-housing transaction services grew by 64.2% year-over-year, accounting for 33.8% of total net revenues, serving as a new growth engine. Our earnings quality improved as well. Net operating cash inflow in 2024 was RMB9.45 billion, 1.3 times our adjusted net income for the year.

We placed great emphasis on shareholder returns. We have in aggregate repurchased shares with a total consideration of approximately US$716 million in 2024, which accounted for approximately 3.9% of the Company’s total issued shares at the end of 2023. Meanwhile, we are here to declare our final cash dividend, with an aggregate amount of approximately US$0.4 billion, reaffirming our commitment to sharing long-term value with our shareholders.

We believe our outstanding financial management capabilities will safeguard our ‘one body, three wings’ strategy and facilitate the steady growth of all business lines.”

Fourth Quarter 2024 Financial Results

Net Revenues

Net revenues increased by 54.1% to RMB31.1 billion (US$4.3 billion) in the fourth quarter of 2024 from RMB20.2 billion in the same period of 2023, primarily attributable to the increase of total GTV and the expansion of home rental business. Total GTV increased by 55.5% to RMB1,143.8 billion (US$156.7 billion) in the fourth quarter of 2024 from RMB735.6 billion in the same period of 2023, primarily attributable to the recovery of housing transaction market driven by the supportive policies and the Company’s proactive growth strategy and enhanced capabilities in market coverage.

Net revenues from existing home transaction services were RMB8.9 billion (US$1.2 billion) in the fourth quarter of 2024, increased by 47.5% from RMB6.0 billion in the same period of 2023. GTV of existing home transactions increased by 59.1% to RMB744.8 billion (US$102.0 billion) in the fourth quarter of 2024 from RMB468.1 billion in the same period of 2023. The higher growth rate in GTV compared to net revenues in existing home transaction services was primarily attributable to a decrease in the commission rate of existing home sales transaction services, driven by a strategic scaling-down of certain value-added services offerings as the Company prioritized service quality assurance to ensure the premium offerings maintain their value proposition to customers.
Among that, (i) commission revenue was RMB7.4 billion (US$1.0 billion) in the fourth quarter of 2024, increased by 53.0% from RMB4.9 billion in the same period of 2023, primarily attributable to the increase of GTV of existing home transactions served by Lianjia stores of 65.7% to RMB311.7 billion (US$42.7 billion) in the fourth quarter of 2024 from RMB188.1 billion in the same period of 2023, partially offset by the decrease in the commission rate of existing home sales transaction services charged by Lianjia stores which was driven by a strategic scale back certain value-added services offerings; and

(ii) revenues derived from platform service, franchise service and other value-added services, which are mostly charged to connected stores and agents on the Company’s platform increased by 25.0% to RMB1.5 billion (US$0.2 billion) in the fourth quarter of 2024 from RMB1.2 billion in the same period of 2023, mainly due to an increase of GTV of existing home transactions served by connected agents on the Company’s platform of 54.7% to RMB433.2 billion (US$59.3 billion) in the fourth quarter of 2024 from RMB280.0 billion in the same period of 2023, partially offset by incentive-based reductions in platform service and franchise service fees for connected stores.

Net revenues from new home transaction services increased by 72.7% to RMB13.1 billion (US$1.8 billion) in the fourth quarter of 2024 from RMB7.6 billion in the same period of 2023, primarily due to the increase of GTV of new home transactions of 49.3% to RMB355.3 billion (US$48.7 billion) in the fourth quarter of 2024 from RMB238.0 billion in the same period of 2023, and the improved monetization capability. Among that, the GTV of new home transactions facilitated on Beike platform through connected agents, dedicated sales team with the expertise on new home transaction services and other sales channels increased by 51.6% to RMB287.5 billion (US$39.4 billion) in the fourth quarter of 2024 from RMB189.7 billion in the same period of 2023, and the GTV of new home transactions served by Lianjia brand increased by 40.4% to RMB67.8 billion (US$9.3 billion) in the fourth quarter of 2024 from RMB48.3 billion in the same period of 2023.
Net revenues from home renovation and furnishing increased by 12.8% to RMB4.1 billion (US$0.6 billion) in the fourth quarter of 2024 from RMB3.6 billion in the same period of 2023, primarily attributable to a) the increase of orders driven by the synergetic effects from customer acquisition and conversion between home transaction services and home renovation and furnishing business and b) a larger contribution from furniture and home furnishing sales in categories such as customized furniture, soft furnishings, and electrical appliances.

Net revenues from home rental services increased by 108.7% to RMB4.6 billion (US$0.6 billion) in the fourth quarter of 2024 from RMB2.2 billion in the same period of 2023, primarily attributable to the increase of the number of rental units under the Carefree Rent model.

Net revenues from emerging and other services were RMB0.4 billion (US$0.1 billion) in the fourth quarter of 2024, compared to RMB0.7 billion in the same period of 2023.

Cost of Revenues

Total cost of revenues increased by 59.1% to RMB24.0 billion (US$3.3 billion) in the fourth quarter of 2024 from RMB15.1 billion in the same period of 2023.

Commission – split. The Company’s cost of revenues for commissions to connected agents and other sales channels increased by 71.7% to RMB8.7 billion (US$1.2 billion) in the fourth quarter of 2024, from RMB5.1 billion in the same period of 2023, primarily due to the increase in net revenues from new home transaction services derived from transactions facilitated through connected agents and other sales channels.

Commission and compensation – internal. The Company’s cost of revenues for internal commission and compensation increased by 64.8% to RMB6.5 billion (US$0.9 billion) in the fourth quarter of 2024 from RMB3.9 billion in the same period of 2023, primarily due to an increase in the net revenues from existing and new home transactions derived from transactions facilitated through Lianjia agents and the increase in fixed compensation costs mainly driven by the increased number of Lianjia agents and improved benefits for them.

Cost of home renovation and furnishing. The Company’s cost of revenues for home renovation and furnishing increased by 9.8% to RMB2.9 billion (US$0.4 billion) in the fourth quarter of 2024 from RMB2.6 billion in the same period of 2023, which was in line with the growth of net revenues from home renovation and furnishing.
Cost of home rental services. The Company’s cost of revenues for home rental services increased by 101.8% to RMB4.4 billion (US$0.6 billion) in the fourth quarter of 2024 from RMB2.2 billion in the same period of 2023, primarily attributable to the growth of net revenues from home rental services.
Cost related to stores. The Company’s cost related to stores increased by 8.1% to RMB0.8 billion (US$0.1 billion) in the fourth quarter of 2024 from RMB0.7 billion in the same period of 2023, primarily attributable to the increased number of Lianjia stores.

Other costs. The Company’s other costs increased to RMB0.7 billion (US$0.1 billion) in the fourth quarter of 2024 from RMB0.5 billion in the same period of 2023, mainly due to the increased tax and surcharges in line with the increased net revenues and an increase in provision and funding costs of financial services.

Gross Profit

Gross profit increased by 39.4% to RMB7.2 billion (US$1.0 billion) in the fourth quarter of 2024 from RMB5.1 billion in the same period of 2023. Gross margin was 23.0% in the fourth quarter of 2024, compared to 25.5% in the same period of 2023, primarily due to a) a lower contribution margin of existing home transaction services led by the increased fix compensation costs as percentage of net revenues from existing home transaction services and b）a lower contribution margin of emerging and other services.

Income from Operations

Total operating expenses increased by 15.8% to RMB6.2 billion (US$0.8 billion) in the fourth quarter of 2024 from RMB5.3 billion in the same period of 2023.

General and administrative expenses were RMB3.0 billion (US$0.4 billion) in the fourth quarter of 2024, compared with RMB2.6 billion in the same period of 2023, mainly due to the increase in personnel costs, partially offset by the decrease of share-based compensation expenses.
Sales and marketing expenses increased by 12.7% to RMB2.3 billion (US$0.3 billion) in the fourth quarter of 2024 from RMB2.1 billion in the same period of 2023, mainly due to the increase in sales and marketing expenses for home renovation and furnishing business.
Research and development expenses increased by 38.4% to RMB739 million (US$101 million) in the fourth quarter of 2024 from RMB534 million in the same period of 2023, primarily due to the increased headcount of research and development personnel and the increased technical service costs.

Income from operations was RMB1,011 million (US$139 million) in the fourth quarter of 2024, compared to loss from operations of RMB173 million in the same period of 2023. Operating margin was 3.2% in the fourth quarter of 2024, compared to negative 0.9% in the same period of 2023, primarily due to the improved operating leverage in the fourth quarter of 2024, compared to the same period of 2023.

Adjusted income from operations⁶ was RMB1,755 million (US$240 million) in the fourth quarter of 2024, compared to RMB856 million in the same period of 2023. Adjusted operating margin⁷ was 5.6% in the fourth quarter of 2024, compared to 4.2% in the same period of 2023. Adjusted EBITDA⁸ was RMB2,343 million (US$321 million) in the fourth quarter of 2024, compared to RMB1,700 million in the same period of 2023.

Net Income

Net income was RMB577 million (US$79 million) in the fourth quarter of 2024, compared to RMB670 million in the same period of 2023, primarily due to an increase in income tax expenses.

Adjusted net income was RMB1,344 million (US$184 million) in the fourth quarter of 2024, compared to RMB1,714 million in the same period of 2023.

Net Income attributable to KE Holdings Inc.’s Ordinary Shareholders

Net income attributable to KE Holdings Inc.’s ordinary shareholders was RMB570 million (US$78 million) in the fourth quarter of 2024, compared to RMB670 million in the same period of 2023.

Adjusted net income attributable to KE Holdings Inc.’s ordinary shareholders⁹ was RMB1,336 million (US$183 million) in the fourth quarter of 2024, compared to RMB1,713 million in the same period of 2023.

Net Income per ADS

Basic and diluted net income per ADS attributable to KE Holdings Inc.’s ordinary shareholders¹⁰ were RMB0.51 (US$0.07) and RMB0.49 (US$0.07) in the fourth quarter of 2024, respectively, compared to RMB0.58 and RMB0.56 in the same period of 2023, respectively.

Adjusted basic and diluted net income per ADS attributable to KE Holdings Inc.’s ordinary shareholders¹¹ were RMB1.19 (US$0.16) and RMB1.14 (US$0.16) in the fourth quarter of 2024, respectively, compared to RMB1.49 and RMB1.44 in the same period of 2023, respectively.

Cash, Cash Equivalents, Restricted Cash and Short-Term Investments

As of December 31, 2024, the combined balance of the Company’s cash, cash equivalents, restricted cash and short-term investments amounted to RMB61.6 billion (US$8.4 billion).

Fiscal Year 2024 Financial Results

Net Revenues

Net revenues increased by 20.2% to RMB93.5 billion (US$12.8 billion) in 2024 from RMB77.8 billion in 2023, primarily attributable to the increase of net revenues from new home transaction services and the expansion of home renovation and furnishing and home rental business. Total GTV increased by 6.6% to RMB3,349.4 billion (US$458.9 billion) in 2024 from RMB3,142.9 billion in 2023, primarily attributable to the Company’s proactive growth strategy and enhanced capabilities in market coverage.

Net revenues from existing home transaction services were RMB28.2 billion (US$3.9 billion) in 2024, relatively flat compared with RMB28.0 billion in 2023. GTV of existing home transactions increased by 10.8% to RMB2,246.5 billion (US$307.8 billion) in 2024 from RMB2,028.0 billion in 2023.
Among that, (i) commission revenue increased by 1.0% to RMB23.1 billion (US$3.2 billion) in 2024, from RMB22.9 billion in 2023, primarily attributable to the GTV of existing home transactions served by Lianjia stores increased by 8.4% to RMB918.5 billion (US$125.8 billion) in 2024 from RMB847.6 billion in 2023, mainly offset by a lower commission rate of existing home transaction services charged by Lianjia stores in Beijing; and

(ii) revenues derived from platform service, franchise service and other value-added services, which are mostly charged to connected stores and agents on the Company’s platform were RMB5.1 billion (US$0.7 billion) in 2024, relatively flat compared with RMB5.1 billion in 2023, while the GTV of existing home transactions served by connected agents on the Company’s platform increased by 12.5% to RMB1,328.0 billion (US$181.9 billion) in 2024 from RMB1,180.4 billion in 2023. The increase was mainly offset by the decrease in revenues from certain value-added services which were not directly driven by GTV of existing home transactions served by connected agents.

Net revenues from new home transaction services increased by 10.1% to RMB33.7 billion (US$4.6 billion) in 2024 from RMB30.6 billion in 2023, primarily due to the improved monetization capability, which was partially offset by the decrease of GTV of new home transactions of 3.3% to RMB970.0 billion (US$132.9 billion) in 2024 from RMB1,003.0 billion in 2023. Among that, the GTV of new home transactions facilitated on Beike platform through connected agents, dedicated sales team with the expertise on new home transaction services and other sales channels decreased by 3.1% to RMB784.4 billion (US$107.5 billion) in 2024 from RMB809.9 billion in 2023, and the GTV of new home transactions served by Lianjia brand decreased by 3.9% to RMB185.6 billion (US$25.4 billion) in 2024 from RMB193.2 billion in 2023.
Net revenues from home renovation and furnishing increased by 36.1% to RMB14.8 billion (US$2.0 billion) in 2024 from RMB10.9 billion in 2023, primarily attributable to a) the increase of orders driven by the synergetic effects from customer acquisition and conversion between home transaction services and home renovation and furnishing business, b) a larger contribution from furniture and home furnishing sales in categories such as customized furniture, soft furnishings, and electrical appliances, and c) the shortened lead time driven by enhanced delivery capabilities.
Net revenues from home rental services increased by 135.0% to RMB14.3 billion (US$2.0 billion) in 2024 from RMB6.1 billion in 2023, primarily attributable to the increase of the number of rental units under the Carefree Rent model.

Net revenues from emerging and other services increased by 8.8% to RMB2.5 billion (US$0.3 billion) in 2024 from RMB2.3 billion in 2023, primarily attributable to the increase of net revenues from financial services.

Cost of Revenues

Total cost of revenues increased by 25.8% to RMB70.5 billion (US$9.7 billion) in 2024 from RMB56.1 billion in 2023.

Commission – split. The Company’s cost of revenues for commissions to connected agents and other sales channels increased by 11.5% to RMB22.8 billion (US$3.1 billion) in 2024 from RMB20.4 billion in 2023, primarily due to the increase in net revenues from new home transaction services derived from transactions facilitated through connected agents and other sales channels.
Commission and compensation – internal. The Company’s cost of revenues for internal commission and compensation increased by 11.1% to RMB18.9 billion (US$2.6 billion) in 2024 from RMB17.0 billion in 2023, primarily due to an increase in the net revenues from new home transactions derived from transactions facilitated through Lianjia agents and the increase in fixed compensation costs mainly driven by the increased number of Lianjia agents and improved benefits for them.

Cost of home renovation and furnishing. The Company’s cost of revenues for home renovation and furnishing increased by 32.8% to RMB10.2 billion (US$1.4 billion) in 2024 from RMB7.7 billion in 2023, which was in line with the growth of net revenues from home renovation and furnishing.
Cost of home rental services. The Company’s cost of revenues for home rental services increased by 121.0% to RMB13.6 billion (US$1.9 billion) in 2024 from RMB6.2 billion in 2023, primarily attributable to the growth of net revenues from home rental services.
Cost related to stores. The Company’s cost related to stores was RMB2.9 billion (US$0.4 billion) in 2024, relatively flat compared with RMB2.9 billion in 2023.

Other costs. The Company’s other costs increased by 13.6% to RMB2.1 billion (US$0.3 billion) in 2024 from RMB1.9 billion in 2023, mainly due to the increased tax and surcharges in line with the increased net revenues and an increase in provision and funding costs of financial services.

Gross Profit

Gross profit increased by 5.6% to RMB22.9 billion (US$3.1 billion) in 2024 from RMB21.7 billion in 2023. Gross margin was 24.6% in 2024, compared to 27.9% in 2023, primarily due to a) a lower contribution ratio of net revenues from existing home transaction services with a relatively higher margin than other revenue streams; and b) a lower contribution margin of existing home transaction services led by the increased fix compensation costs as percentage of net revenues from existing home transaction services.

Income from Operations

Total operating expenses increased by 13.3% to RMB19.2 billion (US$2.6 billion) in 2024 from RMB16.9 billion in 2023.

General and administrative expenses increased by 8.8% to RMB9.0 billion (US$1.2 billion) in 2024 from RMB8.2 billion in 2023, mainly due to the increase in personnel costs.
Sales and marketing expenses increased by 17.0% to RMB7.8 billion (US$1.1 billion) in 2024 from RMB6.7 billion in 2023, mainly due to the increase in sales and marketing expenses for home renovation and furnishing business.
Research and development expenses increased by 17.9% to RMB2.3 billion (US$0.3 billion) in 2024 from RMB1.9 billion in 2023, primarily due to the increased headcount of research and development personnel and the increased technical service costs.

Income from operations was RMB3,765 million (US$516 million) in 2024, compared to RMB4,797 million in 2023. Operating margin was 4.0% in 2024, compared to 6.2% in 2023, primarily due to a lower gross margin partially offset by the improved operating leverage in 2024, compared to 2023.

Adjusted income from operations was RMB6,890 million (US$944 million) in 2024, compared to RMB8.7 billion in 2023. Adjusted operating margin was 7.4% in 2024, compared to 11.2% in 2023. Adjusted EBITDA was RMB9,534 million (US$1,306 million) in 2024, compared to RMB11.3 billion in 2023.

Net Income

Net income was RMB4,078 million (US$559 million) in 2024, compared to RMB5,890 million in 2023.

Adjusted net income was RMB7,211 million (US$988 million) in 2024, compared to RMB9,798 million in 2023.

Net Income attributable to KE Holdings Inc.’s Ordinary Shareholders

Net income attributable to KE Holdings Inc.’s ordinary shareholders was RMB4,065 million (US$557 million) in 2024, compared to RMB5,883 million in 2023.

Adjusted net income attributable to KE Holdings Inc.’s ordinary shareholders¹² was RMB7,198 million (US$986 million) in 2024, compared to RMB9,792 million in 2023.

Net Income per ADS

Basic and diluted net income per ADS attributable to KE Holdings Inc.’s ordinary shareholders¹³ were RMB3.58 (US$0.49) and RMB3.45 (US$0.47) in 2024, respectively, compared to RMB5.01 and RMB4.89 in 2023, respectively.

Adjusted basic and diluted net income per ADS attributable to KE Holdings Inc.’s ordinary shareholders¹⁴ were RMB6.33 (US$0.87) and RMB6.10 (US$0.84) in 2024, respectively, compared to RMB8.34 and RMB8.13 in 2023, respectively.

Share Repurchase Program

As previously disclosed, the Company established a share repurchase program in August 2022 and upsized and extended it in August 2023 and August 2024, under which the Company may purchase up to US$3 billion of its Class A ordinary shares and/or ADSs until August 31, 2025, subject to obtaining another general unconditional mandate for the repurchase from the shareholders of the Company at the next annual general meeting to continue its share repurchase after the expiry of the existing share repurchase mandate granted by the annual general meeting held on June 14, 2024. As of December 31, 2024, the Company in aggregate has purchased approximately 109.1 million ADSs (representing approximately 327.4 million Class A ordinary shares) on the New York Stock Exchange with a total consideration of approximately US$1,625.4 million under this share repurchase program since its launch.

Final Cash Dividend

The Company is pleased to announce that its board of directors (the “Board”) has approved a final cash dividend (the “Dividend”) of US$0.12 per ordinary share, or US$0.36 per ADS, to holders of ordinary shares and holders of ADSs of record as of the close of business on April 9, 2025, Beijing/ Hong Kong Time and New York Time, respectively, payable in U.S. dollars. The aggregate amount of the Dividend to be paid will be approximately US$0.4 billion, which will be funded by cash surplus on the Company’s balance sheet.

For holders of ordinary shares, in order to qualify for the Dividend, all valid documents for the transfer of shares accompanied by the relevant share certificates must be lodged for registration with the Company’s Hong Kong share registrar, Computershare Hong Kong Investor Services Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong no later than 4:30 p.m. on April 9, 2025 (Beijing/Hong Kong Time). Dividend to be paid to the Company’s ADS holders through the depositary bank will be subject to the terms of the deposit agreement. The payment date is expected to be on or around April 22, 2025 for holders of ordinary shares, and on or around April 25, 2025 for holders of ADSs.

Under the Company’s current dividend policy, the Board has discretion on whether to distribute dividends, subject to certain requirements of Cayman Islands law. In addition, the Company’s shareholders may by ordinary resolution declare a dividend, but no dividend may exceed the amount recommended by the Board. If the Company decides to pay dividends, the form, frequency and amount will be based upon its future operations and earnings, capital requirements and surplus, general financial condition, contractual restrictions and other factors that the Board may deem relevant.

Conference Call Information

The Company will hold an earnings conference call at 8:00 A.M. U.S. Eastern Time on Tuesday, March 18, 2025 (8:00 P.M. Beijing/Hong Kong Time on Tuesday, March 18, 2025) to discuss the financial results.

For participants who wish to join the conference call using dial-in numbers, please complete online registration using the link provided below at least 20 minutes prior to the scheduled call start time. Dial-in numbers, passcode and unique access PIN would be provided upon registering.

Participant Online Registration:

English Line: https://s1.c-conf.com/diamondpass/10045435-su5md1.html

Chinese Simultaneous Interpretation Line (listen-only mode): https://s1.c-conf.com/diamondpass/10045436-c4n72s.html

A replay of the conference call will be accessible through March 25, 2025, by dialing the following numbers:

United States:	+1-855-883-1031
Mainland, China:	400-1209-216
Hong Kong, China:	800-930-639
International:	+61-7-3107-6325
Replay PIN (English line):	10045435
Replay PIN (Chinese simultaneous interpretation line):	10045436

A live and archived webcast of the conference call will also be available at the Company’s investor relations website at https://investors.ke.com.

Exchange Rate

This press release contains translations of certain RMB amounts into U.S. dollars (“US$”) at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to US$ were made at the rate of RMB7.2993 to US$1.00, the noon buying rate in effect on December 31, 2024, in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or US$ amounts referred could be converted into US$ or RMB, as the case may be, at any particular rate or at all. For analytical presentation, all percentages are calculated using the numbers presented in the financial information contained in this earnings release.

Non-GAAP Financial Measures

The Company uses adjusted income (loss) from operations, adjusted net income (loss), adjusted net income (loss) attributable to KE Holdings Inc.’s ordinary shareholders, adjusted operating margin, adjusted EBITDA and adjusted net income (loss) per ADS attributable to KE Holdings Inc.’s ordinary shareholders, each a non-GAAP financial measure, in evaluating its operating results and formulating its business plan. Beike believes that these non-GAAP financial measures help identify underlying trends in the Company’s business that could otherwise be distorted by the effect of certain expenses that the Company includes in its net income (loss). Beike also believes that these non-GAAP financial measures provide useful information about its results of operations, enhance the overall understanding of its past performance and future prospects and allow for greater visibility with respect to key metrics used by its management in formulating its business plan. A limitation of using these non-GAAP financial measures is that these non-GAAP financial measures exclude share-based compensation expenses that have been, and will continue to be for the foreseeable future, a significant recurring expense in the Company’s business.

The presentation of these non-GAAP financial measures should not be considered in isolation or construed as an alternative to gross profit, net income (loss) or any other measure of performance or as an indicator of its operating performance. Investors are encouraged to review these non-GAAP financial measures and the reconciliation to the most directly comparable GAAP measures. The non-GAAP financial measures presented here may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to the Company’s data. Beike encourages investors and others to review its financial information in its entirety and not rely on a single financial measure. Adjusted income (loss) from operations is defined as income (loss) from operations, excluding (i) share-based compensation expenses, (ii) amortization of intangible assets resulting from acquisitions and business cooperation agreement, and (iii) impairment of goodwill, intangible assets and other long-lived assets. Adjusted operating margin is defined as adjusted income (loss) from operations as a percentage of net revenues. Adjusted net income (loss) is defined as net income (loss), excluding (i) share-based compensation expenses, (ii) amortization of intangible assets resulting from acquisitions and business cooperation agreement, (iii) changes in fair value from long-term investments, loan receivables measured at fair value and contingent consideration, (iv) impairment of goodwill, intangible assets and other long-lived assets, (v) impairment of investments, and (vi) tax effects of the above non-GAAP adjustments. Adjusted net income (loss) attributable to KE Holdings Inc.’s ordinary shareholders is defined as net income (loss) attributable to KE Holdings Inc.’s ordinary shareholders, excluding (i) share-based compensation expenses, (ii) amortization of intangible assets resulting from acquisitions and business cooperation agreement, (iii) changes in fair value from long-term investments, loan receivables measured at fair value and contingent consideration, (iv) impairment of goodwill, intangible assets and other long-lived assets, (v) impairment of investments, (vi) tax effects of the above non-GAAP adjustments, and (vii) effects of non-GAAP adjustments on net income (loss) attributable to non-controlling interests shareholders. Adjusted EBITDA is defined as net income (loss), excluding (i) income tax expense, (ii) share-based compensation expenses, (iii) amortization of intangible assets, (iv) depreciation of property, plant and equipment, (v) interest income, net, (vi) changes in fair value from long-term investments, loan receivables measured at fair value and contingent consideration, (vii) impairment of goodwill, intangible assets and other long-lived assets, and (viii) impairment of investments. Adjusted net income (loss) per ADS attributable to KE Holdings Inc.’s ordinary shareholders is defined as adjusted net income (loss) attributable to KE Holdings Inc.’s ordinary shareholders divided by weighted average number of ADS outstanding during the periods used in calculating adjusted net income (loss) per ADS, basic and diluted.

Please see the “Unaudited reconciliation of GAAP and non-GAAP results” included in this press release for a full reconciliation of each non-GAAP measure to its respective comparable GAAP measure.

About KE Holdings Inc.

KE Holdings Inc. is a leading integrated online and offline platform for housing transactions and services. The Company is a pioneer in building infrastructure and standards to reinvent how service providers and customers efficiently navigate and complete housing transactions and services in China, ranging from existing and new home sales, home rentals, to home renovation and furnishing, and other services. The Company owns and operates Lianjia, China’s leading real estate brokerage brand and an integral part of its Beike platform. With more than 23 years of operating experience through Lianjia since its inception in 2001, the Company believes the success and proven track record of Lianjia pave the way for it to build its infrastructure and standards and drive the rapid and sustainable growth of Beike.

Safe Harbor Statement

This press release contains statements that may constitute “forward-looking” statements pursuant to the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “aims,” “future,” “intends,” “plans,” “believes,” “estimates,” “likely to,” and similar statements. Among other things, the quotations from management in this press release, as well as Beike’s strategic and operational plans, contain forward-looking statements. Beike may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”) and The Stock Exchange of Hong Kong Limited (the “Hong Kong Stock Exchange”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about KE Holdings Inc.’s beliefs, plans, and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Beike’s goals and strategies; Beike’s future business development, financial condition and results of operations; expected changes in the Company’s revenues, costs or expenditures; Beike’s ability to empower services and facilitate transactions on Beike platform; competition in the industry in which Beike operates; relevant government policies and regulations relating to the industry; Beike’s ability to protect the Company’s systems and infrastructures from cyber-attacks; Beike’s dependence on the integrity of brokerage brands, stores and agents on the Company’s platform; general economic and business conditions in China and globally; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in KE Holdings Inc.’s filings with the SEC and the Hong Kong Stock Exchange. All information provided in this press release is as of the date of this press release, and KE Holdings Inc. does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

For investor and media inquiries, please contact:

In China:
KE Holdings Inc.
Investor Relations
Siting Li
E-mail: ir@ke.com

Piacente Financial Communications
Jenny Cai
Tel: +86-10-6508-0677
E-mail: ke@tpg-ir.com

In the United States:
Piacente Financial Communications
Brandi Piacente
Tel: +1-212-481-2050
Email: ke@tpg-ir.com

Source: KE Holdings Inc.

KE Holdings Inc. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (All amounts in thousands, except for share, per share data)
	As of December 31,	As of December 31,
	2023	2024
	RMB	RMB	US$

ASSETS
Current assets
Cash and cash equivalents	19,634,716	11,442,965	1,567,680
Restricted cash	6,222,745	8,858,449	1,213,603
Short-term investments	34,257,958	41,317,700	5,660,502
Financing receivables, net of allowance for credit losses of RMB122,482 and RMB147,330 as of December 31, 2023 and 2024, respectively	1,347,759	2,835,527	388,466
Accounts receivable and contract assets, net of allowance for credit losses of RMB1,681,127 and RMB1,636,163 as of December 31, 2023 and 2024, respectively	3,176,169	5,497,989	753,221
Amounts due from and prepayments to related parties	419,270	379,218	51,953
Loan receivables from related parties	28,030	18,797	2,575
Prepayments, receivables and other assets	4,666,976	6,252,700	856,615
Total current assets	69,753,623	76,603,345	10,494,615
Non-current assets
Property, plant and equipment, net	1,965,098	2,400,211	328,828
Right-of-use assets	17,617,915	23,366,879	3,201,249
Long-term investments, net	23,570,988	23,790,106	3,259,231
Intangible assets, net	1,067,459	857,635	117,496
Goodwill	4,856,807	4,777,420	654,504
Long-term loan receivables from related parties	27,000	131,410	18,003
Other non-current assets	1,473,041	1,222,277	167,451
Total non-current assets	50,578,308	56,545,938	7,746,762
TOTAL ASSETS	120,331,931	133,149,283	18,241,377


KE Holdings Inc. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Continued) (All amounts in thousands, except for share, per share data)

	As of December 31,	As of December 31,
	2023	2024
	RMB	RMB	US$

LIABILITIES
Current liabilities
Accounts payable	6,328,516	9,492,629	1,300,485
Amounts due to related parties	430,350	391,446	53,628
Employee compensation and welfare payable	8,145,779	8,414,472	1,152,778
Customer deposits payable	3,900,564	6,078,623	832,768
Income taxes payable	698,568	1,028,735	140,936
Short-term borrowings	290,450	288,280	39,494
Lease liabilities current portion	9,368,607	13,729,701	1,880,961
Contract liability and deferred revenue	4,665,201	6,051,867	829,102
Accrued expenses and other current liabilities	5,695,948	7,268,505	995,782
Total current liabilities	39,523,983	52,744,258	7,225,934
Non-current liabilities
Deferred tax liabilities	279,341	317,697	43,524
Lease liabilities non-current portion	8,327,113	8,636,770	1,183,233
Other non-current liabilities	389	2,563	352
Total non-current liabilities	8,606,843	8,957,030	1,227,109
TOTAL LIABILITIES	48,130,826	61,701,288	8,453,043

KE Holdings Inc. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Continued) (All amounts in thousands, except for share, per share data)
	As of December 31,		As of December 31,
	2023		2024
	RMB		RMB		US$

SHAREHOLDERS’ EQUITY
KE Holdings Inc. shareholders’ equity
Ordinary shares (US$0.00002 par value; 25,000,000,000 ordinary shares authorized, comprising of 24,114,698,720 Class A ordinary shares and 885,301,280 Class B ordinary shares. 3,571,960,220 Class A ordinary shares issued and 3,443,860,844 Class A ordinary shares outstanding⁽¹⁾as of December 31, 2023; 3,479,616,986 Class A ordinary shares issued and 3,337,567,403 Class A ordinary shares outstanding⁽¹⁾as of December 31, 2024; and 151,354,549 and 145,413,446 Class B ordinary shares issued and outstanding as of December 31, 2023 and 2024, respectively)	475		461		63
Treasury shares	(866,198	)	(949,410	)	(130,069	)
Additional paid-in capital	77,583,054		72,460,562		9,927,056
Statutory reserves	811,107		926,972		126,995
Accumulated other comprehensive income	244,302		609,112		83,448
Accumulated deficit	(5,672,916	)	(1,723,881	)	(236,171	)
Total KE Holdings Inc. shareholders’ equity	72,099,824		71,323,816		9,771,322
Non-controlling interests	101,281		124,179		17,012
TOTAL SHAREHOLDERS’ EQUITY	72,201,105		71,447,995		9,788,334
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	120,331,931		133,149,283		18,241,377

(1) Excluding the Class A ordinary shares registered in the name of the depositary bank for future issuance of ADSs upon the exercise or vesting of awards granted under our share incentive plans and the Class A ordinary shares repurchased but not cancelled in the form of ADSs.

KE Holdings Inc. UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (All amounts in thousands, except for share, per share data, ADS and per ADS data)
	For the Three Months Ended						For the Year Ended
	December 31, 2023		December 31, 2024		December 31, 2024		December 31, 2023		December 31, 2024		December 31, 2024
	RMB		RMB		US$		RMB		RMB		US$

Net revenues
Existing home transaction services	6,049,963		8,922,030		1,222,313		27,954,135		28,201,003		3,863,522
New home transaction services	7,574,098		13,076,767		1,791,510		30,575,778		33,653,403		4,610,497
Home renovation and furnishing	3,640,928		4,106,834		562,634		10,850,497		14,768,947		2,023,337
Home rental services	2,194,485		4,580,502		627,526		6,099,747		14,334,479		1,963,816
Emerging and other services	744,752		438,974		60,139		2,296,775		2,499,666		342,453
Total net revenues	20,204,226		31,125,107		4,264,122		77,776,932		93,457,498		12,803,625
Cost of revenues
Commission-split	(5,073,602	)	(8,709,790	)	(1,193,236	)	(20,419,577	)	(22,766,957	)	(3,119,060	)
Commission and compensation-internal	(3,917,437	)	(6,456,881	)	(884,589	)	(17,015,927	)	(18,903,786	)	(2,589,808	)
Cost of home renovation and furnishing	(2,628,015	)	(2,884,614	)	(395,190	)	(7,705,325	)	(10,229,696	)	(1,401,463	)
Cost of home rental services	(2,166,138	)	(4,370,712	)	(598,785	)	(6,163,044	)	(13,619,506	)	(1,865,865	)
Cost related to stores	(727,054	)	(785,966	)	(107,677	)	(2,872,093	)	(2,854,988	)	(391,132	)
Others	(547,934	)	(746,958	)	(102,333	)	(1,882,952	)	(2,138,510	)	(292,973	)
Total cost of revenues⁽¹⁾	(15,060,180	)	(23,954,921	)	(3,281,810	)	(56,058,918	)	(70,513,443	)	(9,660,301	)
Gross profit	5,144,046		7,170,186		982,312		21,718,014		22,944,055		3,143,324
Operating expenses
Sales and marketing expenses⁽¹⁾	(2,080,363	)	(2,344,000	)	(321,127	)	(6,654,178	)	(7,783,341	)	(1,066,313	)
General and administrative expenses⁽¹⁾	(2,647,739	)	(2,961,294	)	(405,695	)	(8,236,569	)	(8,960,747	)	(1,227,617	)
Research and development expenses⁽¹⁾	(533,620	)	(738,683	)	(101,199	)	(1,936,780	)	(2,283,424	)	(312,828	)
Impairment of goodwill, intangible assets and other long-lived assets	(55,441	)	(115,179	)	(15,779	)	(93,417	)	(151,576	)	(20,766	)
Total operating expenses	(5,317,163	)	(6,159,156	)	(843,800	)	(16,920,944	)	(19,179,088	)	(2,627,524	)
Income (loss) from operations	(173,117	)	1,011,030		138,512		4,797,070		3,764,967		515,800
Interest income, net	311,963		283,417		38,828		1,263,332		1,260,163		172,642
Share of results of equity investees	(18,130	)	6,144		842		9,098		10,192		1,396
Impairment loss for equity investments accounted for equity method	(4,187	)	–		–		(10,369	)	–		–
Fair value changes in investments, net	4,127		125,333		17,171		78,320		312,791		42,852
Impairment loss for equity investments accounted for using Measurement Alternative	(16,605	)	(971	)	(133	)	(28,800	)	(9,408	)	(1,289	)
Foreign currency exchange loss	(174,459	)	(6,805	)	(932	)	(93,956	)	(34,674	)	(4,750	)
Other income, net	832,103		192,069		26,313		1,869,300		1,566,038		214,546
Income before income tax expense	761,695		1,610,217		220,601		7,883,995		6,870,069		941,197
Income tax expense	(91,632	)	(1,032,969	)	(141,516	)	(1,994,391	)	(2,791,889	)	(382,487	)
Net income	670,063		577,248		79,085		5,889,604		4,078,180		558,710

KE Holdings Inc.
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Continued)

(All amounts in thousands, except for share, per share data, ADS and per ADS data)

For the Three Months Ended

For the Year Ended

December 31,
2023

December 31,
2024

December 31,
2023

December 31,
2024

RMB

US$

RMB

US$

Net income attributable to non-controlling interests shareholders

(458

)

(7,256

)

(994

)

(6,380

)

(13,280

)

(1,819

)

Net income attributable to KE Holdings Inc.

669,605

569,992

78,091

5,883,224

4,064,900

556,891

Net income attributable to KE Holdings Inc.’s ordinary shareholders

669,605

569,992

78,091

5,883,224

4,064,900

556,891

Net income

670,063

577,248

79,085

5,889,604

4,078,180

558,710

Currency translation adjustments

(138,522

)

348,802

47,786

574,223

217,142

29,748

Unrealized gains (losses) on available-for-sale investments, net of reclassification

133,067

(15,206

)

(2,083

)

82,800

147,668

20,230

Total comprehensive income

664,608

910,844

124,788

6,546,627

4,442,990

608,688

Comprehensive income attributable to non-controlling interests shareholders

(458

)

(7,256

)

(994

)

(6,380

)

(13,280

)

(1,819

)

Comprehensive income attributable to KE Holdings Inc.

664,150

903,588

123,794

6,540,247

4,429,710

606,869

Comprehensive income attributable to KE Holdings Inc.’s ordinary shareholders

664,150

903,588

123,794

6,540,247

4,429,710

606,869

	For the Three Months Ended			For the Year Ended
	December 31, 2023	December 31, 2024	December 31, 2024	December 31, 2023	December 31, 2024	December 31, 2024
	RMB	RMB	US$	RMB	RMB	US$

Weighted average number of ordinary shares used in computing net income per share, basic and diluted
—Basic	3,449,700,565	3,356,948,233	3,356,948,233	3,521,379,938	3,409,772,592	3,409,772,592
—Diluted	3,557,221,957	3,525,088,426	3,525,088,426	3,611,653,020	3,537,408,029	3,537,408,029

Weighted average number of ADS used in computing net income per ADS, basic and diluted
—Basic	1,149,900,188	1,118,982,744	1,118,982,744	1,173,793,313	1,136,590,864	1,136,590,864
—Diluted	1,185,740,652	1,175,029,475	1,175,029,475	1,203,884,340	1,179,136,010	1,179,136,010

Net income per share attributable to KE Holdings Inc.’s ordinary shareholders
—Basic	0.19	0.17	0.02	1.67	1.19	0.16
—Diluted	0.19	0.16	0.02	1.63	1.15	0.16

Net income per ADS attributable to KE Holdings Inc.’s ordinary shareholders
—Basic	0.58	0.51	0.07	5.01	3.58	0.49
—Diluted	0.56	0.49	0.07	4.89	3.45	0.47

(1) Includes share-based compensation expenses as follows:
Cost of revenues	138,967	135,358	18,544	502,523	521,293	71,417
Sales and marketing expenses	51,347	53,410	7,317	180,465	197,320	27,033
General and administrative expenses	580,363	360,801	49,430	2,345,895	1,821,817	249,588
Research and development expenses	47,761	45,499	6,233	186,666	185,645	25,433

KE Holdings Inc. UNAUDITED RECONCILIATION OF GAAP AND NON-GAAP RESULTS (All amounts in thousands, except for share, per share data, ADS and per ADS data)
	For the Three Months Ended						For the Year Ended
	December 31, 2023		December 31, 2024		December 31, 2024		December 31, 2023		December 31, 2024		December 31, 2024
	RMB		RMB		US$		RMB		RMB		US$

Income (loss) from operations	(173,117	)	1,011,030		138,512		4,797,070		3,764,967		515,800
Share-based compensation expenses	818,438		595,068		81,524		3,215,549		2,726,075		373,471
Amortization of intangible assets resulting from acquisitions and business cooperation agreement	155,039		33,695		4,616		613,307		247,862		33,957
Impairment of goodwill, intangible assets and other long-lived assets	55,441		115,179		15,779		93,417		151,576		20,766
Adjusted income from operations	855,801		1,754,972		240,431		8,719,343		6,890,480		943,994

Net income	670,063		577,248		79,085		5,889,604		4,078,180		558,710
Share-based compensation expenses	818,438		595,068		81,524		3,215,549		2,726,075		373,471
Amortization of intangible assets resulting from acquisitions and business cooperation agreement	155,039		33,695		4,616		613,307		247,862		33,957
Changes in fair value from long-term investments, loan receivables measured at fair value and contingent consideration	546		27,960		3,831		(26,315	)	24,371		3,339
Impairment of goodwill, intangible assets and other long-lived assets	55,441		115,179		15,779		93,417		151,576		20,766
Impairment of investments	20,792		971		133		39,169		9,408		1,289
Tax effects on non-GAAP adjustments	(6,561	)	(6,495	)	(890	)	(26,243	)	(26,399	)	(3,617	)
Adjusted net income	1,713,758		1,343,626		184,078		9,798,488		7,211,073		987,915

Net income	670,063		577,248		79,085		5,889,604		4,078,180		558,710
Income tax expense	91,632		1,032,969		141,516		1,994,391		2,791,889		382,487
Share-based compensation expenses	818,438		595,068		81,524		3,215,549		2,726,075		373,471
Amortization of intangible assets	158,339		38,041		5,212		627,146		268,684		36,810
Depreciation of property, plant and equipment	196,436		238,496		32,674		775,042		743,728		101,890
Interest income, net	(311,963	)	(283,417	)	(38,828	)	(1,263,332	)	(1,260,163	)	(172,642	)
Changes in fair value from long-term investments, loan receivables measured at fair value and contingent consideration	546		27,960		3,831		(26,315	)	24,371		3,339
Impairment of goodwill, intangible assets and other long-lived assets	55,441		115,179		15,779		93,417		151,576		20,766
Impairment of investments	20,792		971		133		39,169		9,408		1,289
Adjusted EBITDA	1,699,724		2,342,515		320,926		11,344,671		9,533,748		1,306,120

Net income attributable to KE Holdings Inc.’s ordinary shareholders	669,605		569,992		78,091		5,883,224		4,064,900		556,891
Share-based compensation expenses	818,438		595,068		81,524		3,215,549		2,726,075		373,471
Amortization of intangible assets resulting from acquisitions and business cooperation agreement	155,039		33,695		4,616		613,307		247,862		33,957
Changes in fair value from long-term investments, loan receivables measured at fair value and contingent consideration	546		27,960		3,831		(26,315	)	24,371		3,339
Impairment of goodwill, intangible assets and other long-lived assets	55,441		115,179		15,779		93,417		151,576		20,766
Impairment of investments	20,792		971		133		39,169		9,408		1,289
Tax effects on non-GAAP adjustments	(6,561	)	(6,495	)	(890	)	(26,243	)	(26,399	)	(3,617	)
Effects of non-GAAP adjustments on net income attributable to non-controlling interests shareholders	(7	)	(7	)	(1	)	(28	)	(28	)	(4	)
Adjusted net income attributable to KE Holdings Inc.’s ordinary shareholders	1,713,293		1,336,363		183,083		9,792,080		7,197,765		986,092

KE Holdings Inc. UNAUDITED RECONCILIATION OF GAAP AND NON-GAAP RESULTS (Continued) (All amounts in thousands, except for share, per share data, ADS and per ADS data)
	For the Three Months Ended			For the Year Ended
	December 31, 2023	December 31, 2024	December 31, 2024	December 31, 2023	December 31, 2024	December 31, 2024
	RMB	RMB	US$	RMB	RMB	US$

Weighted average number of ADS used in computing net income per ADS, basic and diluted
—Basic	1,149,900,188	1,118,982,744	1,118,982,744	1,173,793,313	1,136,590,864	1,136,590,864
—Diluted	1,185,740,652	1,175,029,475	1,175,029,475	1,203,884,340	1,179,136,010	1,179,136,010

Weighted average number of ADS used in calculating adjusted net income per ADS, basic and diluted
—Basic	1,149,900,188	1,118,982,744	1,118,982,744	1,173,793,313	1,136,590,864	1,136,590,864
—Diluted	1,185,740,652	1,175,029,475	1,175,029,475	1,203,884,340	1,179,136,010	1,179,136,010

Net income per ADS attributable to KE Holdings Inc.’s ordinary shareholders
—Basic	0.58	0.51	0.07	5.01	3.58	0.49
—Diluted	0.56	0.49	0.07	4.89	3.45	0.47

Non-GAAP adjustments to net income per ADS attributable to KE Holdings Inc.’s ordinary shareholders
—Basic	0.91	0.68	0.09	3.33	2.75	0.38
—Diluted	0.88	0.65	0.09	3.24	2.65	0.37

Adjusted net income per ADS attributable to KE Holdings Inc.’s ordinary shareholders
—Basic	1.49	1.19	0.16	8.34	6.33	0.87
—Diluted	1.44	1.14	0.16	8.13	6.10	0.84

KE Holdings Inc. UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (All amounts in thousands)
	For the Three Months Ended						For the Year Ended
	December 31, 2023		December 31, 2024		December 31, 2024		December 31, 2023		December 31, 2024		December 31, 2024
	RMB		RMB		US$		RMB		RMB		US$

Net cash provided by operating activities	1,767,804		5,202,518		712,740		11,414,244		9,447,137		1,294,255
Net cash provided by (used in) investing activities	3,712,203		(2,015,584	)	(276,133	)	(3,977,440	)	(9,378,025	)	(1,284,784	)
Net cash provided by (used in) financing activities	(1,475,585	)	1,109,860		152,050		(7,218,210	)	(5,794,635	)	(793,862	)
Effect of exchange rate change on cash, cash equivalents and restricted cash	(142,337	)	184,196		25,237		44,608		169,476		23,216
Net increase (decrease) in cash and cash equivalents and restricted cash	3,862,085		4,480,990		613,894		263,202		(5,556,047	)	(761,175	)
Cash, cash equivalents and restricted cash at the beginning of the period	21,995,376		15,820,424		2,167,389		25,594,259		25,857,461		3,542,458
Cash, cash equivalents and restricted cash at the end of the period	25,857,461		20,301,414		2,781,283		25,857,461		20,301,414		2,781,283

KE Holdings Inc. UNAUDITED SEGMENT CONTRIBUTION MEASURE (All amounts in thousands)
	For the Three Months Ended						For the Year Ended
	December 31, 2023		December 31, 2024		December 31, 2024		December 31, 2023		December 31, 2024		December 31, 2024
	RMB		RMB		US$		RMB		RMB		US$
Existing home transaction services
Net revenues	6,049,963		8,922,030		1,222,313		27,954,135		28,201,003		3,863,522
Less: Commission and compensation	(3,355,714	)	(5,315,541	)	(728,226	)	(14,762,910	)	(16,016,079	)	(2,194,194	)
Contribution	2,694,249		3,606,489		494,087		13,191,225		12,184,924		1,669,328
New home transaction services
Net revenues	7,574,098		13,076,767		1,791,510		30,575,778		33,653,403		4,610,497
Less: Commission and compensation	(5,574,423	)	(9,723,154	)	(1,332,067	)	(22,455,253	)	(25,304,481	)	(3,466,700	)
Contribution	1,999,675		3,353,613		459,443		8,120,525		8,348,922		1,143,797
Home renovation and furnishing
Net revenues	3,640,928		4,106,834		562,634		10,850,497		14,768,947		2,023,337
Less: Material costs, commission and compensation	(2,628,015	)	(2,884,614	)	(395,190	)	(7,705,325	)	(10,229,696	)	(1,401,463	)
Contribution	1,012,913		1,222,220		167,444		3,145,172		4,539,251		621,874
Home rental services
Net revenues	2,194,485		4,580,502		627,526		6,099,747		14,334,479		1,963,816
Less: Property leasing costs, commission and compensation	(2,166,138	)	(4,370,712	)	(598,785	)	(6,163,044	)	(13,619,506	)	(1,865,865	)
(Deficit)/Contribution	28,347		209,790		28,741		(63,297	)	714,973		97,951
Emerging and other services
Net revenues	744,752		438,974		60,139		2,296,775		2,499,666		342,453
Less: Commission and compensation	(60,902	)	(127,976	)	(17,532	)	(217,341	)	(350,183	)	(47,974	)
Contribution	683,850		310,998		42,607		2,079,434		2,149,483		294,479

1 GTV for a given period is calculated as the total value of all transactions which the Company facilitated on the Company’s platform and evidenced by signed contracts as of the end of the period, including the value of the existing home transactions, new home transactions, home renovation and furnishing and emerging and other services (excluding home rental services), and including transactions that are contracted but pending closing at the end of the relevant period. For the avoidance of doubt, for transactions that failed to close afterwards, the corresponding GTV represented by these transactions will be deducted accordingly.
² Adjusted net income (loss) is a non-GAAP financial measure, which is defined as net income (loss), excluding (i) share-based compensation expenses, (ii) amortization of intangible assets resulting from acquisitions and business cooperation agreement, (iii) changes in fair value from long-term investments, loan receivables measured at fair value and contingent consideration, (iv) impairment of goodwill, intangible assets and other long-lived assets, (v) impairment of investments, and (vi) tax effects of the above non-GAAP adjustments. Please refer to the section titled “Unaudited reconciliation of GAAP and non-GAAP results” for details.
³ Based on our accumulated operational experience, we have introduced the operating metrics of number of active stores and number of active agents on our platform, which can better reflect the operational activeness of stores and agents on our platform.
“Active stores” as of a given date is defined as stores on our platform excluding the stores which (i) have not facilitated any housing transaction during the preceding 60 days, (ii) do not have any agent who has engaged in any critical steps in housing transactions (including but not limited to introducing new properties, attracting new customers and conducting property showings) during the preceding seven days, or (iii) have not been visited by any agent during the preceding 14 days. The number of active stores was 42,021 as of December 31, 2023.
4 “Active agents” as of a given date is defined as agents on our platform excluding the agents who (i) delivered notice to leave but have not yet completed the exit procedures, (ii) have not engaged in any critical steps in housing transactions (including but not limited to introducing new properties, attracting new customers and conducting property showings) during the preceding 30 days, or (iii) have not participated in facilitating any housing transaction during the preceding three months. The number of active agents was 397,135 as of December 31, 2023.
⁵ “Mobile monthly active users” or “mobile MAU” are to the sum of (i) the number of accounts that have accessed our platform through our Beike or Lianjia mobile app (with duplication eliminated) at least once during a month, and (ii) the number of Weixin users that have accessed our platform through our Weixin Mini Programs at least once during a month. Average mobile MAU for any period is calculated by dividing (i) the sum of the Company’s mobile MAUs for each month of such period, by (ii) the number of months in such period.
⁶ Adjusted income (loss) from operations is a non-GAAP financial measure, which is defined as income (loss) from operations, excluding (i) share-based compensation expenses, (ii) amortization of intangible assets resulting from acquisitions and business cooperation agreement, and (iii) impairment of goodwill, intangible assets and other long-lived assets. Please refer to the section titled “Unaudited reconciliation of GAAP and non-GAAP results” for details.
⁷ Adjusted operating margin is adjusted income (loss) from operations as a percentage of net revenues.
⁸ Adjusted EBITDA is a non-GAAP financial measure, which is defined as net income (loss), excluding (i) income tax expense, (ii) share-based compensation expenses, (iii) amortization of intangible assets, (iv) depreciation of property, plant and equipment, (v) interest income, net, (vi) changes in fair value from long-term investments, loan receivables measured at fair value and contingent consideration, (vii) impairment of goodwill, intangible assets and other long-lived assets,and (viii) impairment of investments. Please refer to the section titled “Unaudited reconciliation of GAAP and non-GAAP results” for details.
⁹ Adjusted net income (loss) attributable to KE Holdings Inc.’s ordinary shareholders is a non-GAAP financial measure and defined as net income (loss) attributable to KE Holdings Inc.’s ordinary shareholders, excluding (i) share-based compensation expenses, (ii) amortization of intangible assets resulting from acquisitions and business cooperation agreement, (iii) changes in fair value from long-term investments, loan receivables measured at fair value and contingent consideration, (iv) impairment of goodwill, intangible assets and other long-lived assets, (v) impairment of investments, (vi) tax effects of the above non-GAAP adjustments, and (vii) effects of non-GAAP adjustments on net income (loss) attributable to non-controlling interests shareholders. Please refer to the section titled “Unaudited reconciliation of GAAP and non-GAAP results” for details.
¹⁰ ADS refers to American Depositary Share. Each ADS represents three Class A ordinary shares of the Company. Net income (loss) per ADS attributable to KE Holdings Inc.’s ordinary shareholders is net income (loss) attributable to ordinary shareholders divided by weighted average number of ADS outstanding during the periods used in calculating net income (loss) per ADS, basic and diluted.
¹¹ Adjusted net income (loss) per ADS attributable to KE Holdings Inc.’s ordinary shareholders is a non-GAAP financial measure, which is defined as adjusted net income (loss) attributable to KE Holdings Inc.’s ordinary shareholders divided by weighted average number of ADS outstanding during the periods used in calculating adjusted net income (loss) per ADS, basic and diluted. Please refer to the section titled “Unaudited reconciliation of GAAP and non-GAAP results” for details.
¹² Adjusted net income (loss) attributable to KE Holdings Inc.’s ordinary shareholders is a non-GAAP financial measure and defined as net income (loss) attributable to KE Holdings Inc.’s ordinary shareholders, excluding (i) share-based compensation expenses, (ii) amortization of intangible assets resulting from acquisitions and business cooperation agreement, (iii) changes in fair value from long-term investments, loan receivables measured at fair value and contingent consideration, (iv) impairment of goodwill, intangible assets and other long-lived assets, (v) impairment of investments, (vi) tax effects of the above non-GAAP adjustments, and (vii) effects of non-GAAP adjustments on net income (loss) attributable to non-controlling interests shareholders. Please refer to the section titled “Unaudited reconciliation of GAAP and non-GAAP results” for details.
¹³ ADS refers to American Depositary Share. Each ADS represents three Class A ordinary shares of the Company. Net income (loss) per ADS attributable to KE Holdings Inc.’s ordinary shareholders is net income (loss) attributable to ordinary shareholders divided by weighted average number of ADS outstanding during the periods used in calculating net income (loss) per ADS, basic and diluted.
¹⁴ Adjusted net income (loss) per ADS attributable to KE Holdings Inc.’s ordinary shareholders is a non-GAAP financial measure, which is defined as adjusted net income (loss) attributable to KE Holdings Inc.’s ordinary shareholders divided by weighted average number of ADS outstanding during the periods used in calculating adjusted net income (loss) per ADS, basic and diluted. Please refer to the section titled “Unaudited reconciliation of GAAP and non-GAAP results” for details.

https://register-conf.media-server.com/register/BId5c2bd4696d14e7ba2bc391b87ede751

MIL-OSI: UP Fintech Holding Limited Reports Unaudited Fourth Quarter And Full Year 2024 Financial Results

Source: GlobeNewswire (MIL-OSI)

SINGAPORE, March 18, 2025 (GLOBE NEWSWIRE) — UP Fintech Holding Limited (NASDAQ: TIGR) (“UP Fintech” or the “Company”), a leading online brokerage firm focusing on global investors, today announced its unaudited financial results for the fourth quarter and full year ended December 31, 2024.

Mr. Wu Tianhua, Chairman and CEO of UP Fintech stated: “Both of our financial and operating performance have achieved significant growth in the fourth quarter and the full year of 2024. Total revenue in the fourth quarter reached US$124.1 million, representing a sequential increase of 22.8% and a year-over-year growth of 77.3%. The full year total revenue amounted to US$391.5 million, a 43.7% increase from 2023. Bottom line also largely increased on a GAAP and non-GAAP basis. Net income attributable to ordinary shareholders of UP Fintech in the fourth quarter reached US$28.1 million, representing a quarter-over-quarter growth of 58.0% and compared to a net loss of US$1.8 million in the same quarter of last year. Non-GAAP net income attributable to ordinary shareholders of UP Fintech in the fourth quarter amounted to US$30.5 million, a quarter-over-quarter increase of 51.7% and a year-over-year increase of 2772.5%. The full year net income and non-GAAP net income attributable to ordinary shareholders of UP Fintech in 2024 were US$60.7 million and US$70.5 million, increased 86.5% and 65.0% respectively compared to prior year. We are pleased to see that both our annual and quarterly topline and bottom line have reached an all-time high as we keep executing internationalization strategy and building a resilient business model with healthier operating leverage.

In the fourth quarter, we added 59,200 customers with deposits, an increase of 17.2% quarter over quarter and 51.4% year over year, bringing our yearly total to 187,400, exceeding our yearly guidance of 150,000. The total number of customers with deposits at the end of 2024 reached 1,092,000, a 20.7% increase compared to 2023 year-end. Additionally, asset inflows remained robust, with a net inflow of US$1.1 billion in the fourth quarter, primarily from retail investors. This was slightly offset by a mark-to-market loss. As a result, the total account balance rose by 2.4% quarter over quarter and 36.4% year over year, reaching a record US$41.7 billion. Over the past three years, the number of customers with deposits and total account balance have achieved compound annual growth rates (“CAGRs”) of 17.5% and 34.7%, respectively.

We have continued to roll out a range of localized products and features designed to enhance the user experience. In late January, our cryptocurrency platform, YAX (Hong Kong) Limited, received official approval from the Hong Kong Securities and Futures Commission (HKSFC), becoming a licensed virtual asset trading platform (VATP) in Hong Kong. Recently, we officially upgraded our AI investment assistant, TigerGPT to TigerAI and integrated with leading AI models, making it the first brokerage platform globally to incorporate such technology.

Our corporate business continued to perform well in the fourth quarter of 2024. During this period, we underwrote a total of 14 U.S. and Hong Kong IPOs, including “Mao Geping Company”, “Pony AI Inc.” and “WeRide Inc.”, bringing the total number of U.S. and Hong Kong IPOs underwritten for the year to 44. In our ESOP business, we added 16 new clients in the fourth quarter, bringing the total number of ESOP clients served to 613 as of December 31, 2024.”

Financial Highlights for Fourth Quarter 2024

Total revenues increased 77.3% year-over-year to US$124.1 million.
Total net revenues increased 98.9% year-over-year to US$107.4 million.
Net income attributable to ordinary shareholders of UP Fintech was US$28.1 million compared to a net loss of US$1.8 million in the same quarter of last year.
Non-GAAP net income attributable to ordinary shareholders of UP Fintech was US$30.5 million, compared to a non-GAAP net income of US$1.1 million in the same quarter of last year, an increase of 2772.5%. A reconciliation of non-GAAP financial metrics to the most comparable GAAP metrics is set forth below.

Financial Highlights for Fiscal Year 2024

Total revenues increased 43.7% year-over-year to US$391.5 million.
Total net revenues increased 46.6% year-over-year to US$330.7 million.
Net income attributable to ordinary shareholders of UP Fintech was US$60.7 million compared to a net income of US$32.6 million in 2023, an increase of 86.5%.
Non-GAAP net income attributable to ordinary shareholders of UP Fintech was US$70.5 million, compared to a non-GAAP net income of US$42.7 million in 2023, an increase of 65.0%. A reconciliation of non-GAAP financial metrics to the most comparable GAAP metrics is set forth below.

Operating Highlights as of Year End 2024

Total account balance increased 36.4% year-over-year to US$41.7 billion.
Total margin financing and securities lending balance increased 88.2% year-over-year to US$4.5 billion.
Total number of customers with deposit increased 20.7% year-over-year to 1,092,000.

Selected Operating Data for Fourth Quarter 2024

	As of and for the three months ended
	December 31,	September 30,	December 31,
	2023	2024	2024
In 000’s
Number of customer accounts	2,195.7	2,368.0	2,449.3
Number of customers with deposits	904.6	1,032.8	1,092.0
Number of options and futures contracts traded	8,044.5	15,261.2	18,926.3
In USD millions
Trading volume	81,765.2	162,990.0	198,016.9
Trading volume of stocks	19,711.6	41,406.3	55,502.6
Total account balance	30,597.5	40,763.6	41,725.2

Fourth Quarter 2024 Financial Results

REVENUES

Total revenues were US$124.1 million, an increase of 77.3% from US$70.0 million in the same quarter of last year.

Commissions were US$56.0 million, an increase of 154.9% from US$22.0 million in the same quarter of last year, due to an increase in trading volume.

Financing service fees were US$2.8 million, a decrease of 12.7% from US$3.2 million in the same quarter of last year, primarily due to a decrease in securities lending activities of our fully disclosed account customers.

Interest income was US$55.8 million, an increase of 39.6% from US$40.0 million in the same quarter of last year, primarily due to the increase in margin financing and securities lending activities of our consolidated account customers.

Other revenues were US$9.6 million, an increase of 96.2% from US$4.9 million in the same quarter of last year, primarily due to the increase in IPO subscription incomes and currency exchange incomes.

Interest expense was US$16.7 million, an increase of 4.6% from US$16.0 million in the same quarter of last year, primarily due to the increase in margin financing activities.

OPERATING COSTS AND EXPENSES

Total operating costs and expenses were US$73.1 million, an increase of 39.3% from US$52.5 million in the same quarter of last year.

Execution and clearing expenses were US$6.1 million, an increase of 171.5% from US$2.2 million in the same quarter of last year due to an increase in our trading volume.

Employee compensation and benefits expenses were US$37.2 million, an increase of 40.5% from US$26.5 million in the same quarter of last year, primarily due to an increase of global headcount to support our global expansion.

Occupancy, depreciation and amortization expenses were US$2.1 million, a slight decrease of 2.4% from US$2.2 million in the same quarter of last year.

Communication and market data expenses were US$11.8 million, an increase of 38.2% from US$8.5 million in the same quarter of last year due to increased IT-related fees.

Marketing and branding expenses were US$9.5 million, an increase of 64.2% from US$5.8 million in the same quarter of last year, primarily due to higher marketing spending this quarter.

General and administrative expenses were US$6.4 million, a decrease of 11.8% from US$7.3 million in the same quarter of last year due to a decrease in professional service fees.

NET LOSS/INCOME ATTRIBUTABLE TO ORDINARY SHAREHOLDERS OF UP FINTECH

Net income attributable to ordinary shareholders of UP Fintech was US$28.1 million, as compared to a net loss of US$1.8 million in the same quarter of last year. Net income per ADS – diluted was US$0.158, as compared to a net loss per ADS – diluted of US$0.012 in the same quarter of last year.

Non-GAAP net income attributable to ordinary shareholders of UP Fintech, which excludes share-based compensation, was US$30.5 million, as compared to a US$1.1 million non-GAAP net income attributable to ordinary shareholders of UP Fintech in the same quarter of last year. Non-GAAP net income per ADS – diluted was US$0.172 as compared to a non-GAAP net income per ADS – diluted of US$0.007 in the same quarter of last year.

For the fourth quarter of 2024, the Company’s weighted average number of ADSs used in calculating non-GAAP net income per ADS – diluted was 179,173,811. As of December 31, 2024, the Company had a total of 2,640,326,072 Class A and B ordinary shares outstanding, or the equivalent of 176,021,738 ADSs.

Full Year 2024 Financial Results

REVENUES

Total revenues were US$391.5 million, an increase of 43.7% from US$272.5 million in 2023.

Commissions were US$159.0 million, an increase of 71.8% from US$92.6 million in 2023, due to an increase in trading volume.

Financing service fees were US$11.3 million, a decrease of 7.1% from US$12.2 million in 2023, primarily due to a decrease in securities lending activities of our fully disclosed account customers.

Interest income was US$191.8 million, an increase of 28.4% from US$149.3 million in 2023, primarily due to the increase in margin financing and securities lending activities of our consolidated account customers.

Other revenues were US$29.4 million, an increase of 59.6% from US$18.4 million in 2023, primarily due to the increase in IPO subscription incomes and currency exchange incomes.

Interest expense was US$60.8 million, an increase of 29.5% from US$47.0 million in 2023, primarily due to the increase in margin financing and securities lending activities.

OPERATING COSTS AND EXPENSES

Total operating costs and expenses were US$252.3 million, an increase of 30.9% from US$192.7 million in 2023.

Execution and clearing expenses were US$14.7 million, an increase of 61.3% from US$9.1 million in 2023 due to an increase in our trading volume.

Employee compensation and benefits expenses were US$122.4 million, an increase of 21.5% from US$100.8 million in 2023, primarily due to an increase of global headcount to support our global expansion.

Occupancy, depreciation and amortization expenses were US$8.6 million, a decrease of 8.9% from US$9.4 million in 2023.

Communication and market data expenses were US$38.9 million, an increase of 26.1% from US$30.8 million in 2023 due to increased IT-related fees.

Marketing and branding expenses were US$28.5 million, an increase of 36.8% from US$20.9 million in 2023, primarily due to higher marketing spending this year.

General and administrative expenses were US$39.3 million, an increase of 80.2% from US$21.8 million in 2023 due to an increase in bad debt expense.

NET INCOME ATTRIBUTABLE TO ORDINARY SHAREHOLDERS OF UP FINTECH

Net income attributable to ordinary shareholders of UP Fintech was US$60.7 million, as compared to a net income of US$32.6 million in 2023. Net income per ADS – diluted was US$0.366, as compared to a net income per ADS – diluted of US$0.207 in 2023.

Non-GAAP net income attributable to ordinary shareholders of UP Fintech, which excludes share-based compensation, was US$70.5 million, as compared to a US$42.7 million non-GAAP net income attributable to ordinary shareholders of UP Fintech in 2023. Non-GAAP net income per ADS – diluted was US$0.424 as compared to a non-GAAP net income per ADS – diluted of US$0.270 in 2023.

CERTAIN OTHER FINANCIAL ITEMS

As of December 31, 2024, the Company’s cash and cash equivalents, term deposits and long-term deposits were US$396.0 million, compared to US$327.7 million as of December 31, 2023.

As of December 31, 2024, the allowance balance of receivables from customers was US$15.3 million compared to US$1.0 million as of December 31, 2023, which was due to a bad debt provision concerning the recoverability of a specific Hong Kong stock pledge business faced with extreme market situation and significant price drop, leading to a provision for the loan balance.

Conference Call Information:

UP Fintech’s management will hold an earnings conference call at 8:00 AM on March 18, 2025, U.S. Eastern Time (8:00 PM on March 18, 2025, Singapore/Hong Kong Time).

All participants wishing to attend the call must preregister online before they may receive the dial-in numbers. Preregistration may require a few minutes to complete.

Preregistration Information:

Please note that all participants will need to pre-register for the conference call, using the link:

It will automatically lead to the registration page of “UP Fintech Holding Limited Fourth Quarter And Full Year 2024 Earnings Conference Call”, where details for RSVP are needed.

Upon registering, all participants will be provided in confirmation emails with participant dial-in numbers and personal PINs to access the conference call. Please dial in 10 minutes prior to the call start time using the conference access information.

Additionally, a live and archived webcast of the conference call will be available at https://ir.itigerup.com

Use of Non-GAAP Financial Measures

In evaluating our business, we consider and use non-GAAP net loss or income attributable to ordinary shareholders of UP Fintech and non-GAAP net loss or income per ADS – diluted as supplemental measures to review and assess our operating performance. The presentation of the non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with the United States Generally Accepted Accounting Principles (“U.S. GAAP”). We define non-GAAP net loss or income attributable to ordinary shareholders of UP Fintech as net loss or income attributable to ordinary shareholders of UP Fintech excluding share-based compensation. Non-GAAP net loss or income per ADS – diluted is non-GAAP net loss or income attributable to ordinary shareholders of UP Fintech divided by the weighted average number of diluted ADSs.

We present these non-GAAP financial measures because they are used by our management to evaluate our operating performance and formulate business plans. Non-GAAP net loss or income attributable to ordinary shareholders of UP Fintech enables our management to assess our operating results without considering the impact of share-based compensation. We also believe that the use of these non-GAAP financial measures facilitates investors’ assessment of our operating performance.

These non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. These non-GAAP financial measures have limitations as an analytical tool. One of the key limitations of using these non-GAAP financial measures is that they do not reflect all items of income and expenses that affect our operations. Share-based compensation has been and may continue to be incurred in our business and are not reflected in the presentation of non-GAAP net loss or income attributable to ordinary shareholders of UP Fintech. Further, these non-GAAP financial measures may differ from the non-GAAP financial information used by other companies, including peer companies, and therefore their comparability may be limited.

These non-GAAP financial measures should not be considered in isolation or construed as alternatives to total operating costs and expenses, net loss or income attributable to ordinary shareholders of UP Fintech or any other measure of performance or as an indicator of our operating performance. Investors are encouraged to review these historical non-GAAP financial measures in light of the most directly comparable GAAP measures. These non-GAAP financial measures presented here may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting the usefulness of such measures when analyzing our data comparatively. We encourage investors and others to review our financial information in its entirety and not rely on a single financial measure.

About UP Fintech Holding Limited

UP Fintech Holding Limited is a leading online brokerage firm focusing on global investors. The Company’s proprietary mobile and online trading platform enables investors to trade in equities and other financial instruments on multiple exchanges around the world. The Company offers innovative products and services as well as a superior user experience to customers through its “mobile first” strategy, which enables it to better serve and retain current customers as well as attract new ones. The Company offers customers comprehensive brokerage and value-added services, including trade order placement and execution, margin financing, IPO subscription, ESOP management, investor education, community discussion and customer support. The Company’s proprietary infrastructure and advanced technology are able to support trades across multiple currencies, multiple markets, multiple products, multiple execution venues and multiple clearinghouses.

For more information on the Company, please visit: https://ir.itigerup.com.

Safe Harbor Statement

This announcement contains forward−looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward−looking statements can be identified by terminology such as “may,” “might,” “aim,” “likely to,” “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and similar statements or expressions. Among other statements, the business outlook and quotations from management in this announcement, the Company’s strategic and operational plans and expectations regarding growth and expansion of its business lines, and the Company’s plans for future financing of its business contain forward-looking statements. The Company may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (“SEC”) on Forms 20−F and 6−K, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties, including the earnings conference call. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward−looking statements. Forward−looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company’s ability to effectively implement its growth strategies; trends and competition in global financial markets; changes in the Company’s revenues and certain cost or expense accounting policies; and governmental policies and regulations affecting the Company’s industry and general economic conditions in China, Singapore and other countries. Further information regarding these and other risks is included in the Company’s filings with the SEC, including the Company’s annual report on Form 20-F filed with the SEC on April 22, 2024. All information provided in this press release and in the attachments is as of the date of this press release, and the Company undertakes no obligation to update any forward-looking statement, except as required under applicable law. Further information regarding these and other risks is included in the Company’s filings with the SEC.

For investor and media inquiries please contact:

Investor Relations Contact

UP Fintech Holding Limited

Email: ir@itiger.com

UP FINTECH HOLDING LIMITED UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (All amounts in U.S. dollars (“US$”))
	As of December 31,		As of December 31,
	2023		2024
	US$		US$
Assets:
Cash and cash equivalents	322,599,616		393,576,874
Cash-segregated for regulatory purpose	1,617,154,185		2,464,683,625
Term deposits	896,683		1,075,260
Receivables from customers (net of allowance of US$991,286 and US$15,284,002 as of December 31, 2023 and December 31, 2024)	753,361,199		1,052,972,649
Receivables from brokers, dealers, and clearing organizations	541,876,929		2,305,740,507
Financial instruments held, at fair value	428,159,554		75,547,082
Prepaid expenses and other current assets	17,936,180		17,629,819
Amounts due from related parties	7,987,756		16,720,671
Total current assets	3,689,972,102		6,327,946,487
Non-current assets:
Long-term deposits	4,225,412		1,369,994
Right-of-use assets	9,067,885		10,880,673
Property, equipment and intangible assets, net	16,429,543		15,358,528
Goodwill	2,492,668		2,492,668
Long-term investments	7,586,483		7,658,809
Equity method investment	—		10,203,622
Other non-current assets	5,282,012		6,828,553
Deferred tax assets	10,990,998		8,573,135
Total non-current assets	56,075,001		63,365,982
Total assets	3,746,047,103		6,391,312,469
Current liabilities:
Payables to customers	2,913,306,558		3,574,651,125
Payables to brokers, dealers and clearing organizations	114,771,931		1,914,769,701
Accrued expenses and other current liabilities	42,381,946		67,263,254
Deferred income-current	819,809		—
Lease liabilities-current	4,133,883		4,153,928
Amounts due to related parties	10,148,142		874,331
Total current liabilities	3,085,562,269		5,561,712,339
Convertible bonds	156,887,691		159,505,397
Lease liabilities-non-current	4,777,134		5,902,323
Deferred tax liabilities	3,397,831		2,068,661
Total liabilities	3,250,624,925		5,729,188,720
Mezzanine equity
Redeemable non-controlling interest	6,706,660		7,177,668
Total Mezzanine equity	6,706,660		7,177,668
Shareholders’ equity:
Class A ordinary shares	22,528		25,427
Class B ordinary shares	976		976
Additional paid-in capital	505,448,080		619,030,730
Statutory reserve	8,511,039		12,425,463
(Accumulated deficit) Retained earnings	(19,600,434	)	37,843,547
Treasury Stock	(2,172,819	)	(2,172,819	)
Accumulated other comprehensive loss	(3,232,993	)	(11,919,310	)
Total UP Fintech shareholders’ equity	488,976,377		655,234,014
Non-controlling interests	(260,859	)	(287,933	)
Total equity	488,715,518		654,946,081
Total liabilities, mezzanine equity and equity	3,746,047,103		6,391,312,469

UP FINTECH HOLDING LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS)
(All amounts in U.S. dollars (“US$”), except for number of shares (or ADSs) and per share (or ADS) data)

	For the three months ended						For the years ended
	December 31,		September 30,		December 31,		December 31,		December 31,
	2023		2024		2024		2023		2024
	US$		US$		US$		US$		US$
Revenues:
Commissions	21,954,587		41,207,882		55,964,174		92,593,458		159,045,052
Interest related income
Financing service fees	3,174,949		2,803,878		2,770,419		12,178,838		11,311,560
Interest income	39,956,315		47,957,486		55,762,091		149,291,006		191,754,746
Other revenues	4,895,109		9,084,834		9,605,165		18,444,293		29,430,071
Total revenues	69,980,960		101,054,080		124,101,849		272,507,595		391,541,429
Interest expense	(15,995,738	)	(15,700,359	)	(16,731,341	)	(46,957,657	)	(60,803,516	)
Total Net Revenues	53,985,222		85,353,721		107,370,508		225,549,938		330,737,913
Operating costs and expenses:
Execution and clearing	(2,244,785	)	(3,518,611	)	(6,095,132	)	(9,084,089	)	(14,651,612	)
Employee compensation and benefits	(26,458,931	)	(28,769,980	)	(37,163,110	)	(100,750,644	)	(122,365,537	)
Occupancy, depreciation and amortization	(2,190,610	)	(2,162,704	)	(2,137,586	)	(9,387,056	)	(8,554,315	)
Communication and market data	(8,532,128	)	(9,730,680	)	(11,787,814	)	(30,831,488	)	(38,893,381	)
Marketing and branding	(5,790,739	)	(8,223,404	)	(9,507,918	)	(20,859,834	)	(28,530,053	)
General and administrative	(7,293,530	)	(6,932,672	)	(6,432,737	)	(21,791,263	)	(39,278,674	)
Total operating costs and expenses	(52,510,723	)	(59,338,051	)	(73,124,297	)	(192,704,374	)	(252,273,572	)
Other (loss) income:
Others, net	(1,664,053	)	(5,189,945	)	3,469,021		13,148,173		3,299,308
(Loss) income before income tax	(189,554	)	20,825,725		37,715,232		45,993,737		81,763,649
Income tax expenses	(1,498,639	)	(2,907,080	)	(9,488,084	)	(12,986,310	)	(20,409,721	)
Net (loss) income	(1,688,193	)	17,918,645		28,227,148		33,007,427		61,353,928
Less: net (loss) income attributable to non-controlling interests	(1,293	)	3,353		12,563		(98,285	)	(4,477	)
Accretion of redeemable non-controlling interests to redemption value	(148,624	)	(160,998	)	(164,328	)	(542,187	)	(630,485	)
Net (loss) income attributable to ordinary shareholders of UP Fintech	(1,835,524	)	17,754,294		28,050,257		32,563,525		60,727,920
Other comprehensive income (loss), net of tax:
Unrealized loss on available-for-sale investments	(450,325	)	—		343,892		(450,325	)	343,892
Changes in cumulative foreign currency translation adjustment	7,261,631		16,119,046		(17,440,809	)	(545,498	)	(9,022,611	)
Total Comprehensive income (loss)	5,123,113		34,037,691		11,130,231		32,011,604		52,675,209
Less: comprehensive (loss) income attributable to non-controlling interests	(8,222	)	(7,023	)	24,226		(92,526	)	3,121
Accretion of redeemable non-controlling interests to redemption value	(148,624	)	(160,998	)	(164,328	)	(542,187	)	(630,485	)
Total Comprehensive income attributable to ordinary shareholders of UP Fintech	4,982,711		33,883,716		10,941,677		31,561,943		52,041,603
Net (loss) income per ordinary share:
Basic	(0.001	)	0.008		0.011		0.014		0.025
Diluted	(0.001	)	0.007		0.011		0.014		0.024
Net (loss) income per ADS (1 ADS represents 15 Class A ordinary shares):
Basic	(0.012	)	0.113		0.164		0.210		0.379
Diluted	(0.012	)	0.110		0.158		0.207		0.366
Weighted average number of ordinary shares used in calculating net (loss) income per ordinary share:
Basic	2,336,018,747		2,362,528,627		2,557,911,677		2,325,338,439		2,404,640,854
Diluted	2,336,018,747		2,467,241,917		2,687,607,158		2,427,268,831		2,534,097,315

Reconciliations of Unaudited Non-GAAP Results of Operations Measures to the Nearest Comparable GAAP Measures
(All amounts in U.S. dollars (“US$”), except for number of ADSs and per ADS data)

For the three months ended December 31,
2023

For the three months ended September 30,
2024

For the three months ended December 31,
2024

non-GAAP

GAAP

Adjustment

non-GAAP

GAAP

Adjustment

non-GAAP

GAAP

Adjustment

non-GAAP

US$

Unaudited

2,896,312

(1)

2,331,274

(1)

2,421,342

(1)

Net (loss) income attributable to ordinary shareholders of UP Fintech

(1,835,524

)

2,896,312

1,060,788

17,754,294

2,331,274

20,085,568

28,050,257

2,421,342

30,471,599

Net (loss) income per ADS – diluted

(0.012

)

0.007

0.110

0.124

0.158

0.172

Weighted average number of ADSs used in calculating diluted net (loss) income per ADS

155,734,583

157,931,785

164,482,794

179,173,811

(1) Share-based compensation.

Reconciliations of Unaudited Non-GAAP Results of Operations Measures to the Nearest Comparable GAAP Measures
(All amounts in U.S. dollars (“US$”), except for number of ADSs and per ADS data)

For the year ended December 31,
2023

For the year ended December 31,
2024

non-GAAP

GAAP

Adjustment

non-GAAP

GAAP

Adjustment

non-GAAP

US$

Unaudited

10,147,362

(1)

9,736,901

(1)

Net income attributable to ordinary shareholders of UP Fintech

32,563,525

10,147,362

42,710,887

60,727,920

9,736,901

70,464,821

Net income per ADS – diluted

0.207

0.270

0.366

0.424

Weighted average number of ADSs used in calculating diluted net income per ADS

161,817,922

162,607,678

168,939,821

(1) Share-based compensation.

MIL-OSI Australia: Ex-HMAS Brisbane re-imagined by Cyclone Alfred

Source: Government of Queensland

Issued: 18 Mar 2025

Open larger image

Ex-HMAS Brisbane post Tropical Cyclone Alfred inspection.

Sections of the ex-HMAS Brisbane, a former Royal Australian Navy warship that is one of Australia’s premier wreck-dive sites, have been redesigned by Tropical Cyclone Alfred.

Steve Hoseck, Principal Ranger of Southern Marine Parks, Queensland Parks and Wildlife Service said rangers conducted an initial post-cyclone inspection of the popular dive site, located off Mooloolaba, over the weekend.

“While the majority of the wreck remains in great shape, and appears unaffected by Alfred, a large forward section of the ship has undergone a major makeover,” Mr Hoseck said.

“An entire section below the front funnel has detached and been relocated to the port side of the ship – this is an amazing demonstration of the power of the waves and water currents that were at play during the cyclone.”

Mr Hoseck said Rangers are prioritising making safe the separated areas so diving can resume as soon as possible.

“Once these works have been completed, we will open the site for guided external-only dives run by the two local dive operators.

“The next priority is a full internal inspection of the wreck to assess if additional work is required before diver entry into the wreck is deemed safe.

“This internal assessment is complex work that requires good sea conditions and could take several months to complete. Access during this time will be limited to guided dives only for safety.

“A multi-beam survey in April will give us an indication of damage to external surfaces, and will be compared to previous surveys to determine if any further twisting or warping has occurred.

“We recognise how important the ex-HMAS Brisbane site is to the local diving community and tourism industry and we are committed to getting the site safe and reopened so that visitors can experience its new creative expressions as soon as possible.

“We ask that people stay away from the site until it is deemed safe.”

“Once deemed safe, the ex-HMAS Brisbane will be an amazing dive, with new twists and unique perspectives thanks to Tropical Cyclone Alfred.”

More information on the Ex-HMAS Brisbane and the conservation park is available at: ex-HMAS Brisbane Conservation Park.

Media contact: DETSI Media Unit on (07) 3339 5831 or media@des.qld.gov.au

MIL OSI News –

MIL-OSI: Natural Gas Services Group, Inc. Reports Fourth Quarter and Year-End 2024 Financial and Operating Results; Provides 2025 Guidance

Source: GlobeNewswire (MIL-OSI)

Midland, Texas, March 17, 2025 (GLOBE NEWSWIRE) — Natural Gas Services Group, Inc. (“NGS” or the “Company”) (NYSE:NGS), a leading provider of natural gas compression equipment, technology, and services to the energy industry, today announced financial results for the three months and year-ended December 31, 2024. The Company also provided guidance for its full year 2025, anticipating significant top- and bottom-line growth with strong momentum moving into 2026.

Fourth Quarter and Full Year 2024 Highlights

Rental revenue of $38.2 million for the fourth quarter and $144.2 million for the full year 2024, representing increases of 21% and 36%, respectively, compared to the prior year comparable periods.

Net income of $2.9 million or $0.23 per diluted share for the fourth quarter and $17.2 million or $1.37 per diluted share for the full year 2024, representing increases of 68% and 263%, respectively, compared to the prior fourth quarter and full year 2023 periods.

Cash flow generated from operating activities of $9.4 million for the fourth quarter and $66.5 million for the full year 2024. This compares to net cash used in operating activities of $7.7 million for the fourth quarter and cash generated of $18.0 million for the full year 2023.

Adjusted EBITDA of $18.0 million for the fourth quarter and $69.5 million for the full year 2024; 2024 Adjusted EBITDA was 52% higher than 2023 and represented the highest level in the Company’s history. Please see Non-GAAP Financial Measures – Adjusted EBITDA, below.

Management Commentary and Outlook

“2024 was a transformational year for Natural Gas Services Group as we executed against our strategic objectives and significantly improved our market presence and financial performance,” stated Justin Jacobs, Chief Executive Officer. “During the year, we enhanced our team and infrastructure, further diversified and expanded our customer base, organically expanded into large horsepower electric units, maintained our industry-leading service levels, and materially increased the size of our overall fleet. I am quite proud of the NGS team as their unwavering dedication to our customers and their passion to excel are the driving forces of our results.”

“2024 was also a record year for NGS as our utilized rental fleet approached 500,000 horsepower and our Adjusted EBITDA increased by over 50% compared to 2023. Equally important, our business became significantly more capital efficient: our total debt increased by only $6 million over the course of 2024 and our leverage declined from 2.53x at the end of 2023 to 2.36x at 2024 year-end. The reduction of working capital was a material driver in the improvement in capital efficiency, and we believe there is more opportunity to monetize non-cash assets in the near term.”

“Looking forward, we see continued strength in the market. We believe our organic growth rate leads the industry and we are taking market share. This was made possible by the hard work of our service technicians and field service team, our leading compressor technology, and strong partnerships with our customers. We expect 2025 will be another year of significant growth in new large horsepower units and we have already signed material new unit contracts for 2026. We are excited for the future and believe we are well positioned to continue to increase shareholder value.”

Corporate Guidance – 2025 Outlook

In November 2024, the Company noted it expected 2024 Adjusted EBITDA to be in the range of $67 – $69 million, total growth capital expenditures for the year to be in the range of $65 – $75 million, and total maintenance expenditures for the year to be in the range of $8 – $11 million. For the full year 2024, the Company reported Adjusted EBITDA of $69.5 million, growth capital expenditures of $60.5 million and maintenance capital expenditures of $11.4 million. Additionally, as of December 31, 2024, rented horsepower stood at 491,756, representing year-over-year growth of 17%.

The Company today provides the following commentary regarding its financial expectations for the 2025 Fiscal Year. For the year ending December 31, 2025, the Company expects growth capital expenditures, which are mostly comprised of new units (essentially all of which are under contract), to be in the range of $95 – $120 million. Once all these units are deployed with customers, which is expected by early 2026, the Company expects its rented horsepower to increase by approximately 90,000 horsepower, which represents an increase of approximately 18% versus year-end 2024. The timing of unit deployments is very heavily weighted to the second half of 2025 and early 2026. Accordingly, the majority of the impact of 2024 and 2025 growth capital expenditures will start to be reflected in Adjusted EBITDA in the second half of 2025 and the first quarter of 2026.

Based on the timing of contractual orders and deployments in 2025, the Company expects 2025 Adjusted EBITDA to be in the range of $74 – $78 million, which at the mid-point of the range, represents a 9% increase over 2024. This range is reflective of the timing of anticipated unit deployments.

	Outlook
FY 2025 Adjusted EBITDA	$74 – $78 million
FY 2025 Growth Capital Expenditures	$95 – $120 million
FY 2025 Maintenance Capital Expenditures	$10 – $13 million
Target Return on Invested Capital	At least 20%

The Company further notes that once all the 2025 growth capital expenditures are spent and the units are deployed, its “run rate” Adjusted EBITDA should increase at a rate (when compared to the fourth quarter of 2024) well in excess of the Company’s anticipated horsepower growth of 18% as noted above. The Company expects 2025 maintenance capital expenditures of $10 – $13 million and its targeted return on invested capital of at least 20% remains unchanged.

2024 Fourth Quarter Financial Results

Revenue: Total revenue for the three months ended December 31, 2024 increased 12% to $40.7 million from $36.2 million for the three months ended December 31, 2023. This increase was due primarily to an increase in rental revenues. Rental revenue increased 21% to $38.2 million in the fourth quarter of 2024 from $31.6 million in the fourth quarter of 2024 due to the addition of higher horsepower packages and pricing improvements. As of December 31, 2024, we had 491,756 horsepower (1,208 rented units) compared to 420,432 horsepower (1,247 rented units) as of December 31, 2023, reflecting a 17% increase in total utilized horsepower. Sequentially, total revenue was essentially flat for the comparable periods, primarily related to lower sales revenue offset by an increase in rental revenue.

Gross Margins: Total gross margins, including depreciation expense increased to $14.6 million for the three months ended December 31, 2024, compared to $13.3 million for the same period in 2023 and decreased from $14.9 million for the three months ended September 30, 2024. Total adjusted gross margin, exclusive of depreciation expense, for the three months ended December 31, 2024, increased to $23.0 million compared to $20.3 million for the three months ended December 31, 2023, and $22.9 million for the three months ended September 30, 2024. For a reconciliation of Gross Margin, see Non-GAAP Financial Measures – Adjusted Gross Margin, below.

Operating Income: Operating income for the three months ended December 31, 2024 was $6.0 million compared to operating income of $4.4 million for the three months ended December 31, 2023 and operating income of $9.5 million, during the third quarter of 2024.

Net Income: Net income for the three months ended December 31, 2024, was $2.9 million, or $0.23 per diluted share compared to net income of $1.7 million or $0.14 per diluted share for the fourth quarter of 2023, and $5.0 million or $0.40 per diluted share for the third quarter of 2024. The increase in net income year-over-year was primarily related to higher rental revenue and rental gross margin, while the sequential decline was primarily related to the inventory allowance and decrease in sales gross profit related to the closure of our Midland fabrication operations, the intangible asset impairment, an increase in stock-based compensation, and an increase in depreciation.

Cash Flows: At December 31, 2024, cash and cash equivalents were approximately $2.1 million, while working capital was $30.8 million. For the twelve months of 2024, cash flows provided by operating activities were $66.5 million, while cash flows used in investing activities was $71.4 million. This compares to cash flows provided by operating activities of $18.0 million and cash flows used in investing activities of $153.9 million for the comparable twelve-month period in 2023. Cash flow used in investing activities during 2024 included $71.9 million in capital expenditures.

Adjusted EBITDA: Adjusted EBITDA increased 11% to $18.0 million for the three months ended December 31, 2024, from $16.3 million for the same period in 2023. This increase was primarily attributable to higher rental revenue and rental adjusted gross margin. Sequentially, adjusted EBITDA declined by 1% when compared to $18.2 million for the three months ended September 30, 2024.

Debt: Outstanding debt on our revolving credit facility as of December 31, 2024 was $170 million. Our leverage ratio at December 31, 2024 was 2.36x and our fixed charge coverage ratio was 2.44x. The Company is in compliance with all terms, conditions and covenants of the credit agreement.

Selected data: The tables below show revenue by product line, gross margin and adjusted gross margin for the trailing five quarters. Adjusted gross margin is the difference between revenue and cost of sales, exclusive of depreciation.

	Revenues
	Three months ended
	December 31,	March 31,	June 30,	September 30,	December 31,
	2023	2024	2024	2024	2024
	(in thousands)
Rental	$ 31,626	$ 33,734	$ 34,926	$ 37,350	$ 38,226
Sales	2,921	2,503	2,270	1,843	997
Aftermarket services	1,674	670	1,295	1,493	1,435
Total	$ 36,221	$ 36,907	$ 38,491	$ 40,686	$ 40,658

	Gross Margin
	Three months ended
	December 31,	March 31,	June 30,	September 30,	December 31,
	2023	2024	2024	2024	2024
	(in thousands)
Rental	$ 12,366	$ 13,761	$ 13,211	$ 15,043	$ 14,865
Sales	553	253	(50)	(258)	(531)
Aftermarket services	421	163	269	151	296
Total	$ 13,340	$ 14,177	$ 13,430	$ 14,936	$ 14,630

	Adjusted Gross Margin (1)
	Three months ended
	December 31,	March 31,	June 30,	September 30,	December 31,
	2023	2024	2024	2024	2024
	(in thousands)
Rental	$ 19,199	$ 20,620	$ 20,698	$ 22,908	$ 23,107
Sales	620	323	21	(185)	(449)
Aftermarket services	440	170	283	169	321
Total	$ 20,259	$ 21,113	$ 21,002	$ 22,892	$ 22,979

	Adjusted Gross Margin %
	Three months ended
	December 31,	March 31,	June 30,	September 30,	December 31,
	2023	2024	2024	2024	2024
Rental	60.7 %	61.1 %	59.3 %	61.3 %	60.4 %
Sales	21.2 %	12.9 %	0.9 %	(10.0) %	(45.0) %
Aftermarket services	26.3 %	25.4 %	21.9 %	11.3 %	22.4 %
Total	55.9 %	57.2 %	54.6 %	56.3 %	56.5 %

	Compression Units (at end of period)
	Three months ended
	December 31,	March 31,	June 30,	September 30,	December 31,
	2023	2024	2024	2024	2024
Rented horsepower	420,432	444,220	454,568	475,534	491,756
Fleet horsepower available	520,365	542,256	552,599	579,699	598,840
Horsepower utilization	80.8 %	81.9 %	82.3 %	82.0 %	82.1 %

Units utilized	1,247	1,245	1,242	1,229	1,208
Fleet units	1,876	1,894	1,899	1,909	1,912
Unit utilization	66.5 %	65.7 %	65.4 %	64.4 %	63.2 %

(1) For a reconciliation of adjusted gross margin to its most directly comparable financial measure calculated and presented in accordance GAAP, please read “Non-GAAP Financial Measures – Adjusted Gross Margin” below.

Non-GAAP Financial Measure – Adjusted Gross Margin: “Adjusted Gross Margin” is defined as total revenue less costs of revenues (excluding depreciation and amortization expense). Adjusted gross margin is included as a supplemental disclosure because it is a primary measure used by our management as it represents the results of revenue and costs (excluding depreciation and amortization expense), which are key components of our operations. Adjusted gross margin differs from gross margin, in that gross margin includes depreciation and amortization expense. We believe Adjusted gross margin is important because it focuses on the current operating performance of our operations and excludes the impact of the prior historical costs of the assets acquired or constructed that are utilized in those operations. Depreciation and amortization expense does not accurately reflect the costs required to maintain and replenish the operational usage of our assets and therefore may not portray the costs from current operating activity. Rather, depreciation and amortization expense reflect the systematic allocation of historical property and equipment costs over their estimated useful lives.

Adjusted gross margin has certain material limitations associated with its use as compared to gross margin. These limitations are primarily due to the exclusion of depreciation and amortization expense, which is material to our results of operations. Because we use capital assets, depreciation and amortization expense is a necessary element of our costs and our ability to generate revenue. In order to compensate for these limitations, management uses this non-GAAP measure as a supplemental measure to other GAAP results to provide a more complete understanding of our performance. As an indicator of our operating performance, Adjusted gross margin should not be considered an alternative to, or more meaningful than, gross margin as determined in accordance with GAAP. Our Adjusted gross margin may not be comparable to a similarly titled measure of another company because other entities may not calculate Adjusted gross margin in the same manner.

The following table calculates our gross margin, the most directly comparable GAAP financial measure, and reconciles it to Adjusted gross margin for the periods presented:

	Adjusted Gross Margin
	Three months ended
	December 31,	March 31,	June 30,	September 30,	December 31,
	2023	2024	2024	2024	2024
	(in thousands)
Total revenue	$ 36,221	$ 36,907	$ 38,491	$ 40,686	$ 40,658
Cost of revenue, exclusive of depreciation	(15,962)	(15,794)	(17,489)	(17,794)	(17,679)
Depreciation allocable to costs of revenue	(6,919)	(6,936)	(7,572)	(7,956)	(8,349)
Gross margin	13,340	14,177	13,430	14,936	14,630
Depreciation allocable to costs of revenue	6,919	6,936	7,572	7,956	8,349
Adjusted gross margin	$ 20,259	$ 21,113	$ 21,002	$ 22,892	$ 22,979

Non-GAAP Financial Measures – Adjusted EBITDA: “Adjusted EBITDA” reflects net income or loss before interest, taxes, depreciation and amortization, non-cash equity-classified stock-based compensation expense, non-recurring restructuring charges including severance expenses, impairments, increases in inventory allowance and retirement of rental equipment. Adjusted EBITDA is a measure used by management, analysts and investors as an indicator of operating cash flow since it excludes the impact of movements in working capital items, non-cash charges and financing costs. Therefore, Adjusted EBITDA gives the investor information as to the cash generated from the operations of a business. However, Adjusted EBITDA is not a measure of financial performance under accounting principles GAAP, and should not be considered a substitute for other financial measures of performance. Adjusted EBITDA as calculated by NGS may not be comparable to Adjusted EBITDA as calculated and reported by other companies. The most comparable GAAP measure to Adjusted EBITDA is net income (loss).

The following tables reconciles our net income, the most directly comparable GAAP financial measure, to Adjusted EBITDA for the periods presented:

	Three months ended
	December 31,	March 31,	June 30,	September 30,	December 31,
	2023	2024	2024	2024	2024
	(in thousands)
Net income	$ 1,702	$ 5,098	$ 4,250	$ 5,014	$ 2,865
Interest expense	2,297	2,935	2,932	3,045	3,015
Income tax expense	431	1,479	1,294	1,383	283
Depreciation and amortization	7,160	7,087	7,705	8,086	8,469
Stock-based compensation expense	228	274	242	522	783
Severance and restructuring charges	—	—	33	—	—
Impairments	—	—	—	136	705
Inventory allowance	3,965	—	—	—	1,863
Retirement of rental equipment	505	5	—	—	23
Adjusted EBITDA	$ 16,288	$ 16,878	$ 16,456	$ 18,186	$ 18,006

	Year ended December 31,
	2023	2024
	(in thousands)
Net income	$ 4,747	$ 17,227
Interest expense	4,082	11,927
Income tax expense	1,873	4,439
Depreciation and amortization	26,550	31,347
Stock-based compensation expense	2,054	1,821
Severance and restructuring charges	1,224	33
Impairments	779	841
Inventory allowance	3,965	1,863
Retirement of rental equipment	505	28
Adjusted EBITDA	$ 45,779	$ 69,526

Conference Call Details: The Company will host a conference call to review its fourth-quarter and year-end financial results on Tuesday, March 18 at 8:30 a.m. (EST), 7:30 a.m. (CST). To join the conference call, kindly access the Investor Relations section of our website at www.ngsgi.com or dial in at (800) 550-9745 and enter conference ID 167298 at least five minutes prior to the scheduled start time. Please note that using the provided dial-in number is necessary for participation in the Q&A section of the call. A recording of the conference will be made available on our Company’s website following its conclusion. Thank you for your interest in our Company’s updates.

About Natural Gas Services Group, Inc.
Natural Gas Services Group is a leading provider of natural gas compression equipment, technology and services to the energy industry. The Company designs, rents, sells and maintains natural gas compressors for oil and natural gas production and plant facilities, primarily using equipment from third-party fabricators and OEM suppliers along with limited in-house assembly. The Company is headquartered in Midland, Texas, with a fabrication facility located in Tulsa, Oklahoma, and service facilities located in major oil and natural gas producing basins in the U.S. Additional information can be found at www.ngsgi.com.

Forward-Looking Statements

Certain statements herein (and oral statements made regarding the subjects of this release) constitute “forward-looking statements” within the meaning of the federal securities laws. Words such as “may,” “might,” “should,” “believe,” “expect,” “anticipate,” “estimate,” “continue,” “predict,” “forecast,” “project,” “plan,” “intend” or similar expressions, or statements regarding intent, belief, or current expectations, are forward-looking statements. These forward-looking statements are based upon current estimates and assumptions.

These forward–looking statements rely on a number of assumptions concerning future events and are subject to a number of uncertainties and factors that could cause actual results to differ materially from such statements, many of which are outside the control of the Company. Forward–looking information includes, but is not limited to statements regarding: guidance or estimates related to EBITDA growth, projected capital expenditures; returns on invested capital, fundamentals of the compression industry and related oil and gas industry, valuations, compressor demand assumptions and overall industry outlook, and the ability of the Company to capitalize on any potential opportunities.

While the Company believes that the assumptions concerning future events are reasonable, investors are cautioned that there are inherent difficulties in predicting certain important factors that could impact the future performance or results of its business. Some of these factors that could cause results to differ materially from those indicated by such forward-looking statements include, but are not limited to:

conditions in the oil and gas industry, including the supply and demand for oil and gas and volatility in the prices of oil and gas;

our reliance on major customers;

failure of projected organic growth due to adverse changes in the oil and gas industry, including depressed oil and gas prices, oppressive environmental regulations and competition;

our inability to achieve increased utilization of assets, including rental fleet utilization and monetizing other non-cash balance sheet assets;

failure of our customers to continue to rent equipment after expiration of the primary rental term;

our ability to economically develop and deploy new technologies and services, including technology to comply with health and environmental laws and regulations;

failure to achieve accretive financial results in connection with any acquisitions we may make;

fluctuations in interest rates;

regulation or prohibition of new well completion techniques;

competition among the various providers of compression services and products;

changes in safety, health and environmental regulations;

changes in economic or political conditions in the markets in which we operate;

the inherent risks associated with our operations, such as equipment defects, malfunctions, natural disasters and adverse changes in customer, employee and supplier relationships;

our inability to comply with covenants in our debt agreements and the decreased financial flexibility associated with our debt;

inability to finance our future capital requirements and availability of financing;

capacity availability, costs and performance of our outsourced compressor fabrication providers and overall inflationary pressures;

impacts of world events, such as acts of terrorism and significant economic disruptions and adverse consequences resulting from possible long-term effects of potential pandemics and other public health crises; and

general economic conditions.

In addition, these forward-looking statements are subject to other various risks and uncertainties, including without limitation those set forth in the Company’s filings with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. Thus, actual results could be materially different. The Company expressly disclaims any obligation to update or alter statements whether as a result of new information, future events or otherwise, except as required by law.

For More Information, Contact:
Anna Delgado, Investor Relations
(432) 262-2700
IR@ngsgi.com
www.ngsgi.com

NATURAL GAS SERVICES GROUP, INC. CONSOLIDATED BALANCE SHEETS (in thousands) (unaudited)
	December 31,
	2024	2023
ASSETS
Current Assets:
Cash and cash equivalents	$ 2,142	$ 2,746
Trade accounts receivable, net of provision for credit losses	15,626	39,186
Inventory, net of allowance for obsolescence	18,051	21,639
Federal income tax receivable	11,282	11,538
Prepaid expenses and other	1,075	1,162
Total current assets	48,176	76,271
Long-term inventory, net of allowance for obsolescence	—	701
Rental equipment, net of accumulated depreciation	415,021	373,649
Property and equipment, net of accumulated depreciation	22,989	20,550
Intangible assets, net of accumulated amortization	—	775
Other assets	6,342	6,783
Total assets	$ 492,528	$ 478,729
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$ 9,670	$ 17,628
Accrued liabilities	7,688	15,085
Total current liabilities	17,358	32,713
Credit facility	170,000	164,000
Deferred income taxes	45,873	41,636
Other long-term liabilities	4,240	4,486
Total liabilities	237,471	242,835
Commitments and contingencies
Stockholders’ Equity:
Preferred stock, 5,000 shares authorized, no shares issued or outstanding	—	—
Common stock, 30,000 shares authorized, par value $0.01; 13,762 and 13,688 shares issued as of December 31, 2024 and 2023, respectively	138	137
Additional paid-in capital	118,415	116,480
Retained earnings	151,508	134,281
Treasury shares, at cost, 1,310 shares for each of December 31, 2024 and 2023, respectively	(15,004)	(15,004)
Total stockholders’ equity	255,057	235,894
Total liabilities and stockholders’ equity	$ 492,528	$ 478,729

NATURAL GAS SERVICES GROUP, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) (unaudited)
	Three months ended		Year ended
	December 31,		December 31,
	2024	2023	2024	2023
Revenue:
Rental	$ 38,226	$ 31,626	$ 144,236	$ 106,159
Sales	997	2,921	7,613	8,921
Aftermarket services	1,435	1,674	4,893	6,087
Total revenue	40,658	36,221	156,742	121,167
Cost of revenues (excluding depreciation and amortization)
Rental	15,119	12,427	7,903	8,919
Sales	1,446	2,301	56,903	48,877
Aftermarket services	1,114	1,234	3,950	4,658
Total cost of revenues (excluding depreciation and amortization)	17,679	15,962	68,756	62,454
Selling, general and administrative expenses	5,831	4,390	21,012	16,938
Depreciation and amortization	8,469	7,160	31,347	26,550
Impairments	705	—	841	779
Inventory allowance	1,863	3,965	1,863	3,965
Retirement of rental equipment	23	505	28	505
Loss (gain) on sale of property and equipment, net	45	(200)	(430)	(481)
Total operating costs and expenses	34,615	31,782	123,417	110,710
Operating income	6,043	4,439	33,325	10,457
Other income (expense):
Interest expense	(3,015)	(2,297)	(11,927)	(4,082)
Other income (expense)	120	(9)	268	245
Total other expense, net	(2,895)	(2,306)	(11,659)	(3,837)
Income before income taxes	3,148	2,133	21,666	6,620
Provision for income taxes	(283)	(431)	(4,439)	(1,873)
Net income	$ 2,865	$ 1,702	$ 17,227	$ 4,747
Earnings per share:
Basic	$ 0.23	$ 0.14	$ 1.39	$ 0.39
Diluted	$ 0.23	$ 0.14	$ 1.37	$ 0.38
Weighted average shares outstanding:
Basic	12,438	12,378	12,412	12,316
Diluted	12,586	12,435	12,543	12,383

NATURAL GAS SERVICES GROUP, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands, except per share amounts) (unaudited)
	Three months ended		Year ended
	December 31,		December 31,
	2024	2023	2024	2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 2,865	$ 1,702	$ 17,227	$ 4,747
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	8,469	7,160	31,347	26,550
Impairments	705	—	841	779
Inventory allowance	1,863	3,965	1,863	3,965
Retirement of rental equipment	23	505	28	505
(Gain) loss on sale of property and equipment	45	(200)	(430)	(481)
Amortization of debt issuance costs	216	138	746	425
Deferred income taxes	182	430	4,237	1,838
Stock-based compensation	783	228	1,821	2,054
Provision for credit losses	—	293	433	492
(Gain) loss on company owned life insurance	(4)	186	(156)	235
Changes in operating assets and liabilities:
Trade accounts receivables	9,183	(11,438)	23,127	(25,010)
Inventory	1,355	1,939	2,477	(669)
Prepaid expenses and prepaid income taxes	1,177	274	152	(7)
Accounts payable and accrued liabilities	(18,580)	(12,478)	(17,727)	2,436
Other	1,144	(369)	477	174
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES	9,426	(7,665)	66,463	18,033
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of rental equipment, property and other equipment	(14,544)	(25,380)	(71,894)	(153,943)
Purchase of company owned life insurance	(187)	(44)	(22)	(422)
Proceeds from sale of property and equipment	(28)	246	476	477
NET CASH USED IN INVESTING ACTIVITIES	(14,759)	(25,178)	(71,440)	(153,888)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from credit facility borrowings	20,000	36,000	28,000	139,000
Repayments of credit facility borrowings	(13,000)	—	(22,000)	—
Payments of other long term liabilities	(158)	(45)	(780)	(95)
Payments of debt issuance costs	—	(562)	(962)	(2,693)
Proceeds from exercise of stock options	223	—	293	—
Taxes paid related to net share settlement of equity awards	—	(1)	(178)	(983)
NET CASH PROVIDED BY FINANCING ACTIVITIES	7,065	35,392	4,373	135,229
NET CHANGE IN CASH AND CASH EQUIVALENTS	1,732	2,549	(604)	(626)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	410	197	2,746	3,372
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$ 2,142	$ 2,746	$ 2,142	$ 2,746

MIL-OSI: Netcapital Announces Third Quarter Fiscal 2025 Financial Results

Source: GlobeNewswire (MIL-OSI)

Management to Host Earnings Call on March 19, 2025 at 10:00 a.m. ET

BOSTON, MA, March 17, 2025 (GLOBE NEWSWIRE) — Netcapital Inc. (Nasdaq: NCPL, NCPLW) (the “Company”), a digital private capital markets ecosystem, today announced financial results for the third quarter of fiscal year 2025 ended January 31, 2025.

“During the fiscal year, management shifted its focus to establishing the company’s wholly-owned broker-dealer subsidiary, Netcapital Securities Inc., which was approved by FINRA in November. We believe this major milestone will provide additional sources of revenue going forward,” said Martin Kay, CEO of Netcapital Inc. “We did face a tough quarter during an uncertain market environment. Looking forward, however, we are pleased that Algernon NeuroScience Inc. recently engaged Netcapital Securities for a planned Regulation A (Reg A) offering and to provide broker-dealer and administrative services.”

Third Quarter Fiscal 2025 Financial Results

Revenue decreased approximately 85% year-over-year to $152,682, compared to revenue of $1,042,793 million in the third quarter of fiscal year 2024
Operating loss was ($1,687,692) in the third quarter fiscal 2025, compared to ($1,205,157) for the third quarter fiscal 2024
Net loss was ($3,006,537) in the third quarter fiscal 2025, compared to net loss of ($2,227,542) for the same period in the prior year
Loss per share was ($1.57) in the third quarter fiscal 2025, compared to loss per share of ($13.60) for the same period in the prior year
As of January 31, 2025, the Company had cash and cash equivalents of $614,304

Conference Call Information

The Company will host an investor conference call on Wednesday, March 19, 2025, at 10 a.m. ET.

Participant access: 844-985-2012 or 973-528-0138
Conference entry code: 165756

For additional disclosure regarding Netcapital’s operating results, please refer to the Quarterly Report on Form 10-Q for the three-month period ended January 31, 2025, which has been filed with the Securities and Exchange Commission.

About Netcapital Inc.

Netcapital Inc. is a fintech company with a scalable technology platform that allows private companies to raise capital online and provides private equity investment opportunities to investors. The Company’s consulting group, Netcapital Advisors, provides marketing and strategic advice and takes equity positions in select companies. The Company’s funding portal, Netcapital Funding Portal, Inc. is registered with the U.S. Securities & Exchange Commission (SEC) and is a member of the Financial Industry Regulatory Authority (FINRA), a registered national securities association. The Company’s broker-dealer, Netcapital Securities Inc., is also registered with the SEC and is a member of FINRA.

Forward Looking Statements

The information contained herein includes forward-looking statements. These statements relate to future events or to our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. You should not place undue reliance on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and which could, and likely will, materially affect actual results, levels of activity, performance or achievements. Any forward-looking statement reflects our current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to our operations, results of operations, growth strategy and liquidity. We assume no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

Investor Contact

800-460-0815
ir@netcapital.com

NETCAPITAL INC.
CONDENSED CONSOLIDATED BALANCE SHEETS

	January 31, 2025 (Unaudited)			April 30, 2024 (Audited)
Assets:
Cash and cash equivalents	$	614,304		$	863,182
Accounts receivable net		–			134,849
Other receivables		2,400			1,200
Note receivable		20,000			20,000
Prepaid expenses		36,115			23,304
Total current assets		672,819			1,042,535

Deposits		6,300			6,300
Notes receivable – related parties		202,000			202,000
Purchased technology, net		14,706,398			14,733,005
Investment in affiliate		240,080			240,080
Equity securities		24,073,080			25,333,386
Total assets	$	39,900,677		$	41,557,306

Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	2,160,727		$	793,325
Accrued expenses		250,983			310,300
Deferred revenue		360			466
Interest payable		98,218			92,483
Current portion of SBA loans		1,885,800			1,885,800
Loan payable – bank		34,324			34,324
Total current liabilities		4,430,412			3,116,698

Long-term liabilities:
Long-term SBA loans, less current portion		500,000			500,000
Total liabilities		4,930,412			3,616,698

Commitments and contingencies		–			–

Stockholders’ equity:
Common stock, $.001 par value; 900,000,000 shares authorized, 2,112,488 and 326,867 shares issued and outstanding		2,113			327
Shares to be issued		122,124			122,124
Capital in excess of par value		42,120,673			37,338,594
Retained earnings (deficit)		(7,274,645	)		479,563
Total stockholders’ equity		34,970,265			37,940,608
Total liabilities and stockholders’ equity	$	39,900,677		$	41,557,306

NETCAPITAL INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)

	Three Months Ended			Three Months Ended			Nine Months Ended			Nine Months Ended
	January 31, 2025			January 31, 2024			January 31, 2025			January 31, 2024

Revenues	$	152,682		$	1,042,793		$	465,437		$	4,604,260
Costs of services		7,155			58,875			37,156			97,062
Gross profit		145,527			983,918			428,281			4,507,198

Costs and expenses:
Consulting expense		63,555			175,357			240,581			544,033
Marketing		12,887			32,198			31,993			320,817
Rent		20,178			19,544			58,736			57,533
Payroll and payroll related expenses		815,024			869,517			2,701,318			2,957,394
General and administrative costs		921,575			1,092,459			3,794,013			2,529,378
Total costs and expenses		1,833,219			2,189,075			6,826,641			6,409,155
Operating income (loss)		(1,687,692	)		(1,205,157	)		(6,398,360	)		(1,901,957	)

Other income (expense):
Interest expense		(10,376	)		(11,918	)		(30,441	)		(35,784	)
Interest income		400			–			1,200			–
Impairment expense		(1,300,000	)		–			(1,300,000	)		–
Amortization of intangible assets		(8,869	)		(28,331	)		(26,607	)		(84,993	)
Unrealized loss on equity securities		–			(2,696,135	)		–			(2,696,135	)
Total other income (expense)		(1,318,845	)		(2,736,384	)		(1,355,848	)		(2,816,912	)
Net income (loss) before taxes		(3,006,537	)		(3,941,541	)		(7,754,208	)		(4,718,869	)
Income tax expense (benefit)		–			(1,713,999	)		–			(2,339,288	)
Net income (loss)	$	(3,006,537	)	$	(2,227,542	)	$	(7,754,208	)	$	(2,379,581	)

Basic earnings (loss) per share	$	(1.57	)	$	(13.60	)	$	(6.93	)	$	(17.61	)
Diluted earnings (loss) per share	$	(1.57	)	$	(13.60	)	$	(6.93	)	$	(17.61	)

Weighted average number of common shares outstanding:
Basic		1,915,367			163,807			1,119,479			135,111
Diluted		1,915,367			163,807			1,119,479			135,111

Kindly find the pdf file

MIL-OSI Asia-Pac: National Quantum Mission: India’s Quantum Leap

Source: Government of India

National Quantum Mission: India’s Quantum Leap

Unleashing the power of quantum technology and creating jobs of tomorrow

Posted On: 17 MAR 2025 6:42PM by PIB Delhi

Introduction

With technology taking over the world, India is stepping into the future with the National Quantum Mission (NQM), a major initiative by the Government of India to propel the nation to the forefront of quantum technology research and development. Approved on 19th April 2023 by the Union Cabinet, the mission the mission is set to span from 2023–24 to 2030–31, with a budget allocation of ₹6,003.65 crore.

National Quantum mission, is not just a mission, but it is a bold step through which India aims to harness the power of quantum technology to drive innovation, strengthen security, and boost various industries, positioning itself as a global leader in this cutting-edge field.

What is Quantum Computing

Quantum computers use special units called qubits to store and process information. Unlike regular computers, where bits can only be 0 or 1, qubits can be both 0 and 1 at the same time. This ability to be in multiple states at once makes quantum computers different and potentially much more powerful than traditional ones.

Many countries are actively working on quantum computing and other quantum technologies, and India has a great opportunity to make significant contributions. The national quantum mission offers India a chance to play a key role, especially with favourable conditions right now. The outcomes of this mission could impact healthcare, clean energy, climate change, job creation, and much more, affecting every citizen’s life.

Objectives of the National Quantum Mission

With the broader aim to harness quantum technologies in India to bolster sectors like communication, cryptography, and computing, National Quantum Mission has outlined specific objectives to advance India’s capabilities in the quantum realm:

Quantum Computing Evolution: Develop intermediate-scale quantum computers with 20-50 physical qubits (3 years), 50-100 physical qubits (5 years), and 50-1000 physical qubits (8 years) across platforms like superconducting and photonic technologies to advance computational capabilities.
Satellite-Based Quantum Communication: Establish satellite-enabled quantum-secured communication between two ground stations over 2000 km within India and extend this technology for long-distance secure quantum communication with other countries.
Inter-City Quantum Key Distribution (QKD): Implement quantum-secured communication spanning 2000 km using trusted nodes and wavelength division multiplexing (WDM) on existing optical fiber infrastructure, enhancing secure data transmission.
Multi-Node Quantum Networks: Develop a multi-node quantum network incorporating quantum memories, entanglement swapping, and synchronized quantum repeaters at each node, enabling scalable and robust quantum communication (2-3 nodes).
Advanced Quantum Sensing & Clocks: Design highly sensitive quantum devices including magnetometers with 1 femto-Tesla/sqrt(Hz) sensitivity in atomic systems and better than 1 pico-Tesla/sqrt(Hz) in Nitrogen Vacancy centers, gravity sensors with better than 100 nano-meter/second² sensitivity, and atomic clocks with 10⁻¹⁹ fractional instability for precision timing, navigation, and secure communication.
Quantum Materials & Devices: Develop and synthesize next-generation quantum materials such as superconductors, novel semiconductor structures, and topological materials for the fabrication of qubits, single-photon sources/detectors, entangled photon sources, and quantum sensing/metrological devices for applications in computing and communication.

The National Quantum Mission (NQM) is one of the nine initiatives under the Prime Minister’s Science Technology Innovation Advisory Council (PMSTIAC), aimed at positioning India as a global leader in quantum technology. By fostering advancements in secure quantum communication, quantum computing, and precision sensing, the mission is poised to transform sectors such as telecommunications, defense, finance, and healthcare, delivering a profound societal impact.

Implementation Strategy: Thematic Hubs (T-Hubs)

The National Quantum Mission is a nationwide initiative driving cutting-edge advancements in quantum technology. As part of this mission, four Thematic Hubs (T-Hubs) have been set up, bringing together 14 Technical Groups across 17 states and 2 Union Territories. These hubs focus on technology innovation, skill development, entrepreneurship, industry partnerships, and global collaborations, ensuring a truly national impact. Women scientists from every corner of the country are actively encouraged to participate and benefit from the mission’s exciting programs.

The four T-Hubs have been established across leading institutions in India:

Indian Institute of Science (IISc) Bengaluru
Indian Institute of Technology (IIT), Madras along with the Centre for Development of Telematics, New Delhi
Indian Institute of Technology (IIT), Bombay
Indian Institute of Technology (IIT), Delhi.

These hubs were selected through a rigorous competitive process and each hub focuses on a specific quantum domain, driving advancements in Quantum Computing, Quantum Communication, Quantum Sensing & Metrology, and Quantum Materials & Devices.

Quantum Domains of Four Thematic Hubs

Hub-Spoke-Spike Model

Each T-Hub will follow the Hub-Spoke-Spike model, fostering a cluster-based network where research projects (Spokes) and individual research groups (Spikes) operate alongside central hubs. This structure enhances collaboration among research institutions, allowing them to share resources and expertise more effectively.

State-wise Funds Allocation

The four T-Hubs selected under NQM collectively involve 152 researchers from 43 institutions nationwide, fostering a collaborative ecosystem to drive research and innovation in quantum technologies. The activities carried out by these hubs include Technology Development, Human Resource Development, Entrepreneurship Development, Industry Collaborations, and International Collaborations.

State-wise Funds Released During 2024-2025

Initiatives under National Quantum Mission

Under NQM, dedicated efforts are underway to develop quantum-resilient encryption techniques and post-quantum cryptographic (PQC) frameworks, ensuring India’s critical database systems remain secure in the quantum era. Key initiatives include:

Quantum-Safe Ecosystem Framework: A concept paper has been developed to outline a strategic roadmap for securing and strengthening India’s digital infrastructure against quantum threats.
DRDO Initiatives: The Defence Research and Development Organization (DRDO) is leading projects focused on designing and testing quantum-resilient security schemes, along with quantum-safe symmetric and asymmetric key cryptographic algorithms.
Advancements by SETS: The Society for Electronic Transactions and Security (SETS), under the Office of the Principal Scientific Adviser (PSA), is accelerating Post-Quantum Cryptography (PQC) research. It has implemented PQC algorithms for applications such as Fast IDentity Online (FIDO) authentication tokens and Internet of Things (IoT) security.
C-DoT Innovations: The Centre for Development of Telematics (C-DoT), under the Department of Telecommunications (DoT), has developed cutting-edge solutions, including Quantum Key Distribution (QKD), Post-Quantum Cryptography (PQC), and Quantum Secure Video IP Phones.

These initiatives are crucial for safeguarding India’s digital infrastructure against emerging quantum-era cybersecurity threats.

Global Competitiveness and Strategic Impact

The NQM has the potential to transform the country’s technology development ecosystem, making it globally competitive. It will drive advancements across key sectors such as communication, healthcare, finance, and energy, with applications in drug discovery, space exploration, banking, and security. Moreover, the mission will play a crucial role in advancing national initiatives like Digital India, Make in India, Skill India, Stand-up India, Start-up India, Self-Reliant India, and the Sustainable Development Goals (SDGs).

Conclusion

The National Quantum Mission (NQM) is more than just a technological initiative—it is a strategic step towards securing India’s future in the quantum era. With significant investments, world-class research collaborations, and dedicated innovation hubs, the mission is set to propel India to the forefront of the global quantum revolution.

This initiative underscores India’s commitment to scientific excellence, economic resilience, and national security in a world where quantum technologies are poised to reshape industries and societies.

References:

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Santosh Kumar/ Sarla Meena/ Priya Nagar

(Release ID: 2111953) Visitor Counter : 44

MIL OSI Asia Pacific News –

MIL-OSI: Hallador Energy Company Reports Fourth Quarter and Full Year 2024 Financial and Operating Results

Source: GlobeNewswire (MIL-OSI)

– Q4 2024 Total Revenue of $94.2 Million; FY’24 Total Revenue of $404.4 Million –
– Q4 2024 Operating Cash Flow up Materially to $32.5 Million; FY’24 Operating Cash Flow of $65.9 Million –
– Q4 2024 Adjusted EBITDA up ~3x YoY to $6.2 Million; FY’24 Adjusted EBITDA of $16.8 Million –

TERRE HAUTE, Ind., March 17, 2025 (GLOBE NEWSWIRE) — Hallador Energy Company (Nasdaq: HNRG) (“Hallador” or the “Company”) today reported its financial results for the fourth quarter and full year ended December 31, 2024.

“2024 was a transformative year for Hallador as we continued our evolution from a bituminous coal producer to a vertically integrated independent power producer (“IPP”), while also advancing our products and services up the energy value chain,” said Brent Bilsland, President and Chief Executive Officer. “This deliberate transition aligns with market trends and reflects our conviction in the superior economics of the IPP business model. In fall 2024, we reached an important milestone in our transformation by signing a non-binding term sheet with a leading global data center developer on a transaction that would, if completed, sell a majority of our power production and accredited capacity at enhanced margins for more than a decade to come. We are making meaningful progress toward finalizing definitive agreements for this transaction within the exclusivity period that runs from January through early June 2025, further strengthened by our partner’s commitment to pay up to $5 million during this period. While navigating these complex transactions requires coordination across multiple stakeholders and while there can be no assurance that definitive agreements will be entered into, we remain encouraged by our partner’s commitment and believe this strategic partnership will drive long-term value for our shareholders.”

“The ongoing industry shift from dispatchable generators, such as coal and natural gas, to non-dispatchable resources like wind and solar, has increased the value of our Hallador Power subsidiary due to the enhanced reliability, resilience and consistency that we provide over the less predictable non-dispatchables. At the same time, the retirement of coal-based generation has reduced demand for coal supply, impacting the value of our Sunrise Coal subsidiary. In anticipation of these market dynamics, we proactively reduced production volume and shifted our focus away from the higher cost coal reserves, which lowered our operational cash costs in the fourth quarter. These strategic actions along with lower long-term coal price projections resulted in a fourth-quarter non-cash write-down of Sunrise Coal’s carrying value by approximately $215 million, which underscores the foresight of our transition to power generation in the coming years.”

Bilsland continued, “Looking ahead, our focus remains on maximizing the value of our Merom Power Plant while actively pursuing opportunities to acquire additional dispatchable generators that can add durability, scale, and geographic expansion to our electric operations. Additionally, we are forging strong relationships with sophisticated counterparties to secure favorable collateral terms and effectively manage our forward power sales in 2025 and 2026, which we believe will enhance our financial flexibility in the short to medium term. During 2024, we also reduced our bank debt by more than 50% to $44 million at year-end. We are excited about our continued transformation from a commodity-focused coal producer to an IPP with a secure fuel supply, a strategy we believe will unlock expanding energy market margins, drive sustainable growth, and enhance cash flow generation for our shareholders.”

Fourth Quarter 2024 Highlights

Hallador advanced its restructuring efforts for its subsidiary Sunrise Coal, focusing on production optimization and cost reductions to strengthen its operations.
- During 2024, the Company reduced its coal production volume by approximately 40% and shifted its focus away from the higher cost portions of its coal reserves. This optimization of coal production reduced Hallador’s operational cash cost structure to better align its coal strategy to support its internal electric generation.
- As a result of reducing coal production, optimizing its reserve base, and the declining price of contracted coal sales, Hallador realized an approximate $215 million non-cash write down in the fourth quarter associated with the carrying value of its Sunrise Coal subsidiary.
The Company continues to shift its revenue mix to prioritize electric sales as an independent power producer.
- Fourth quarter electric sales were $69.7 million or 74% of total Q4 revenue, compared to $37.1 million or 31% of total Q4 revenue in the year-ago period.
- Fourth quarter Coal sales were $23.4 million or 25% of total revenue, compared to $81.3 million or 68% of total revenue in the year-ago period.
Hallador continues to focus on forward sales to secure its energy position.
- At year-end, Hallador had total forward energy, capacity and coal sales to 3rd party customers of $1.1 billion through 2029, up from $937.2 million at the end of the third quarter.
- Subsequent to year end, Hallador signed an exclusive commitment agreement with a leading global data center developer, effective January 2, 2025. This agreement is in furtherance of the previously announced non-binding term sheet signed during the third quarter of 2024, reflecting an important milestone as both the Company and the developer seek to finalize a definitive transaction agreement to support the delivery of energy and capacity (through a utility partner) to a potential data center development within the State of Indiana. The completion of this proposed transaction is subject to, among other matters, the negotiation and execution of definitive agreements and there can be no assurance that definitive agreements will be entered into or that the proposed transaction will be consummated on the terms or timeframe currently contemplated, or at all.
The Company continues to strengthen its balance sheet.
- Total bank debt was $44.0 million at December 31, 2024, compared to $70.0 million at September 30, 2024 and $91.5 million at December 31, 2023.
- Total liquidity was $37.8 million at December 31, 2024 compared to $34.9 million at September 30, 2024 and $26.2 million at December 31, 2023.


Financial Summary ($ in Millions and Unaudited)

	Q1 2024			Q2 2024			Q3 2024			Q4 2024
Electric Sales	$	60.7		$	59.4		$	71.7		$	69.7
Coal Sales– 3^rd Party	$	49.6		$	32.8		$	31.7		$	23.3
Other Revenue	$	1.3		$	1.0		$	1.4		$	1.8
Total Operating Revenue	$	111.6		$	93.2		$	104.8		$	94.8
Net Income (Loss)	$	(1.7	)	$	(10.2	)	$	1.6		$	(215.8	)
Operating Cash Flow	$	18.5		$	26.1		$	(11.2	)	$	32.5
Adjusted EBITDA*	$	6.8		$	(5.8	)	$	9.6		$	6.2

_________________________________

_*_{Non-GAAP financial measure, defined as operating cash flows} _{less effects of certain subsidiary and equity method investment activity, plus bank interest, less effects of working capital period changes, plus other amortization}

Adjusted EBITDA should not be considered an alternative to net income, income from operations, cash flows from operating activities or any other measure of financial performance presented in accordance with GAAP. Our method of computing Adjusted EBITDA may not be the same method used to compute similar measures reported by other companies.

Management believes the non-GAAP financial measure, Adjusted EBITDA, is an important measure in analyzing our liquidity and is a key component of certain material covenants contained within our Credit Agreement, specifically the minimum quarterly EBITDA. Noncompliance with the covenants could result in our lenders requiring the Company to immediately repay all amounts borrowed. If we cannot satisfy these financial covenants, we would be prohibited under our Credit Agreement from engaging in certain activities, such as incurring additional indebtedness, making certain payments, and acquiring and disposing of assets. Consequently, Adjusted EBITDA is critical to the assessment of our liquidity. The required amount of Adjusted EBITDA is a variable based on our debt outstanding and/or required debt payments at the time of the quarterly calculation based on a rolling prior 12-month period.

Reconciliation of the non-GAAP financial measure, Adjusted EBITDA, to Income (Loss) before Income taxes, the most comparable GAAP measure, is as follows (in thousands) for the twelve months ended December 31, 2024 and 2023, respectively.


Reconciliation of GAAP “Income (Loss) before Income Taxes” to non-GAAP “Adjusted EBITDA” (In $ Thousands and Unaudited)

	Year Ended
	December 31,
	2024			2023
NET INCOME (LOSS)	$	(226,138	)	$	44,793
Interest expense		13,850			13,711
Income tax expense (benefit)		(9,404	)		4,465
Depreciation, depletion and amortization		65,626			67,211
EBITDA		(156,066	)		130,180
Other operating revenue		(275	)		10
Stock-based compensation		4,454			3,554
Asset impairment		215,136			—
Asset retirement obligations accretion		1,628			1,804
Other amortization		(46,310	)		(30,613	)
(Gain) loss on disposal or abandonment of assets, net		(50	)		398
Loss on extinguishment of debt		2,790			1,491
Equity method investment (loss)		746			552
Settlement of litigation		2,750			—
Other reclassifications		(8,043	)		—
Adjusted EBITDA	$	16,760		$	107,376


Solid Forward Sales Position – Segment Basis, Before Intercompany Eliminations (unaudited):

	2025		2026		2027		2028		2029		Total
Power
Energy
Contracted MWh (in millions)		4.25		3.36		1.78		1.09		0.27		10.75
Average contracted price per MWh	$	37.24	$	44.43	$	54.66	$	52.94	$	51.33
Contracted revenue (in millions)	$	158.27	$	149.28	$	97.29	$	57.70	$	13.86	$	476.40

Capacity
Average daily contracted capacity MWh		773		727		623		454		100
Average contracted capacity price per MWd	$	201	$	230	$	226	$	225	$	230
Contracted capacity revenue (in millions)	$	55.95	$	61.12	$	51.40	$	37.33	$	3.47	$	209.27

Total Energy & Capacity Revenue

Contracted Power revenue (in millions)	$	214.22	$	210.40	$	148.69	$	95.03	$	17.33	$	685.67

Coal
Priced tons – 3rd party (in millions)		2.95		2.50		2.50		0.50		—		8.45
Avg price per ton – 3rd party	$	51.04	$	55.49	$	56.74	$	59.00	$	—
Contracted coal revenue – 3rd party (in millions)	$	150.57	$	138.73	$	141.85	$	29.50	$	—	$	460.65

TOTAL CONTRACTED REVENUE (IN MILLIONS) – CONSOLIDATED	$	364.79	$	349.13	$	290.54	$	124.53	$	17.33	$	1,146.32

Priced tons – Intercompany (in millions)		2.30		2.30		2.30		2.30		—		9.20
Avg price per ton – Intercompany	$	51.00	$	51.00	$	51.00	$	51.00	$	—
Contracted coal revenue – Intercompany (in millions)	$	117.30	$	117.30	$	117.30	$	117.30	$	—	$	469.20

TOTAL CONTRACTED REVENUE (IN MILLIONS) – SEGMENT	$	482.09	$	466.43	$	407.84	$	241.83	$	17.33	$	1,615.52

Forward-Looking Statements
This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act“), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act“). Statements that are not strictly historical statements constitute forward-looking statements and may often, but not always, be identified by the use of such words such as “expects,” “believes,” “intends,” “anticipates,” “plans,” “estimates,” “guidance,” “target,” “potential,” “possible,” or “probable” or statements that certain actions, events or results “may,” “will,” “should,” or “could” be taken, occur or be achieved. Forward-looking statements include, without limitation, those relating to our ability to execute definitive agreements with respect to the non-binding term sheet with a leading global data center developer. Forward-looking statements are based on current expectations and assumptions and analyses made by Hallador and its management in light of experience and perception of historical trends, current conditions and expected future developments, as well as other factors appropriate under the circumstances that involve various risks and uncertainties that could cause actual results to differ materially from those reflected in the statements. These risks include, but are not limited to, those set forth in Hallador’s annual report on Form 10-K for the year ended December 31, 2024, and other Securities and Exchange Commission filings. Hallador undertakes no obligation to revise or update publicly any forward-looking statements except as required by law.

Conference Call and Webcast

Hallador management will host a conference call on Monday, March 17, 2025 at 5:30 p.m. Eastern time to discuss its financial and operational results, followed by a question-and-answer period.

Date: Monday, March 17, 2025
Time: 5:30 p.m. Eastern time
Dial-in registration link: here
Live webcast registration link: here

The conference call will also be broadcast live and available for replay in the investor relations section of the Company’s website at www.halladorenergy.com.


Hallador Energy Company Condensed Consolidated Balance Sheets As of December 31, (in thousands) (unaudited)

	2024			2023
ASSETS
Current assets:
Cash and cash equivalents	$	7,232		$	2,842
Restricted cash		4,921			4,281
Accounts receivable		15,438			19,937
Inventory		36,685			23,075
Parts and supplies		39,104			38,877
Prepaid expenses		1,478			2,262
Assets held-for-sale		—			1,540
Total current assets		104,858			92,814
Property, plant and equipment:
Land and mineral rights		70,307			115,486
Buildings and equipment		429,857			537,131
Mine development		92,458			158,642
Finance lease right-of-use assets		13,034			12,346
Total property, plant and equipment		605,656			823,605
Less – accumulated depreciation, depletion and amortization		(347,952	)		(334,971	)
Total property, plant and equipment, net		257,704			488,634
Equity method investments		2,607			2,811
Other assets		3,951			5,521
Total assets	$	369,120		$	589,780

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of bank debt, net	$	4,095		$	24,438
Accounts payable and accrued liabilities		44,298			62,908
Current portion of lease financing		6,912			3,933
Contract liabilities – current		97,598			66,316
Total current liabilities		152,903			157,595
Long-term liabilities:
Bank debt, net		37,394			63,453
Convertible notes payable		—			10,000
Convertible notes payable – related party		—			9,000
Long-term lease financing		8,749			8,157
Deferred income taxes		—			9,235
Asset retirement obligations		14,957			14,538
Contract liabilities – long-term		49,121			47,425
Other		1,711			1,789
Total long-term liabilities		111,932			163,597
Total liabilities		264,835			321,192
Commitments and contingencies (Note 22)
Stockholders’ equity:
Preferred stock, $.10 par value, 10,000 shares authorized; none issued		—			—
Common stock, $.01 par value, 100,000 shares authorized; 42,621 and 34,052 issued and outstanding, as of December 31, 2024 and December 31, 2023, respectively		426			341
Additional paid-in capital		189,298			127,548
Retained earnings (deficit)		(85,439	)		140,699
Total stockholders’ equity		104,285			268,588
Total liabilities and stockholders’ equity	$	369,120		$	589,780


Hallador Energy Company Condensed Consolidated Statements of Operations For the years ended December 31, (in thousands, except per share data) (unaudited)

	2024			2023
SALES AND OPERATING REVENUES:
Electric sales	$	261,527		$	267,927
Coal sales		137,448			361,926
Other revenues		5,419			5,025
Total sales and operating revenues		404,394			634,878
EXPENSES:
Fuel		49,343			103,388
Other operating and maintenance costs		118,364			199,855
Cost of purchased power		10,888			—
Utilities		15,914			17,730
Labor		116,164			152,417
Depreciation, depletion and amortization		65,626			67,211
Asset retirement obligations accretion		1,628			1,804
Exploration costs		260			904
General and administrative		26,527			26,159
Asset impairment		215,136			—
(Gain) loss on disposal or abandonment of assets, net		(50	)		398
Settlement of litigation		2,750			—
Total operating expenses		622,550			569,866

INCOME (LOSS) FROM OPERATIONS		(218,156	)		65,012

Interest expense (1)		(13,850	)		(13,711	)
Loss on extinguishment of debt		(2,790	)		(1,491	)
Equity method investment (loss)		(746	)		(552	)
NET INCOME (LOSS) BEFORE INCOME TAXES		(235,542	)		49,258

INCOME TAX EXPENSE (BENEFIT):
Current		(169	)		(164	)
Deferred		(9,235	)		4,629
Total income tax expense (benefit)		(9,404	)		4,465

NET INCOME (LOSS)	$	(226,138	)	$	44,793

NET INCOME (LOSS) PER SHARE:
Basic	$	(5.72	)	$	1.35
Diluted	$	(5.72	)	$	1.25

WEIGHTED AVERAGE SHARES OUTSTANDING
Basic		39,504			33,133
Diluted		39,504			36,827


Hallador Energy Company Condensed Consolidated Statements of Cash Flows For the years ended December 31, (in thousands) (unaudited)

	2024			2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	(226,138	)	$	44,793
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred income tax (benefit)		(9,235	)		4,629
Equity method investment (loss)		746			552
Cash distribution – equity method investment		—			625
Depreciation, depletion and amortization		65,626			67,211
Asset impairment		215,136			—
Loss on extinguishment of debt		2,790			1,491
(Gain) loss on disposal or abandonment of assets, net		(50	)		398
Amortization of debt issuance costs		1,747			3,233
Asset retirement obligations accretion		1,628			1,804
Cash paid on asset retirement obligation reclamation		(1,407	)		(3,384	)
Stock-based compensation		4,454			3,554
Amortization of contract asset and contract liabilities		(70,203	)		(97,018	)
Director fees paid in stock		150			—
Change in current assets and liabilities:
Accounts receivable		4,499			9,952
Inventory		(13,610	)		15,548
Parts and supplies		(227	)		(10,582	)
Prepaid expenses		784			1,186
Accounts payable and accrued liabilities		(14,580	)		(18,992	)
Contract liabilities		103,181			33,804
Other		643			610
Net cash provided by operating activities	$	65,934		$	59,414


Hallador Energy Company Condensed Consolidated Statements of Cash Flows For the years ended December 31, (in thousands) (continued) (unaudited)

	2024			2023
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	$	(53,367	)	$	(75,352	)
Proceeds from sale of equipment		4,239			62
Proceeds from held-for-sale assets		3,200			—
Investment in equity method investments		(542	)		—
Net cash used in investing activities		(46,470	)		(75,290	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on bank debt		(147,000	)		(59,713	)
Borrowings of bank debt		99,500			66,000
Payments on lease financing		(5,633	)		—
Proceeds from sale and leaseback arrangement		5,134			11,082
Issuance of related party notes payable		5,000			—
Payments on related party notes payable		(5,000	)		—
Debt issuance costs		(673	)		(6,013	)
ATM offering		34,515			7,318
Taxes paid on vesting of RSUs		(277	)		(2,101	)
Net cash provided by (used in) financing activities		(14,434	)		16,573
Increase in cash, cash equivalents, and restricted cash		5,030			697
Cash, cash equivalents, and restricted cash, beginning of year		7,123			6,426
Cash, cash equivalents, and restricted cash, end of year	$	12,153		$	7,123

CASH, CASH EQUIVALENTS, AND RESTRICTED CASH:
Cash and cash equivalents	$	7,232		$	2,842
Restricted cash		4,921			4,281
	$	12,153		$	7,123

SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest	$	10,511		$	9,966

SUPPLEMENTAL NON-CASH FLOW INFORMATION:
Change in capital expenditures included in accounts payable and prepaid expense	$	356		$	1,882

About Hallador Energy Company

Hallador Energy Company (Nasdaq: HNRG) is a vertically-integrated Independent Power Producer (IPP) based in Terre Haute, Indiana. The Company has two core businesses: Hallador Power Company, LLC, which produces electricity and capacity at its one Gigawatt (GW) Merom Generating Station, and Sunrise Coal, LLC, which produces and supplies fuel to the Merom Generating Station and other companies. To learn more about Hallador, visit the Company’s website at http://www.halladorenergy.com/.

Company Contact

Marjorie Hargrave
Chief Financial Officer
(303) 917-0777
MHargrave@halladorenergy.com

Investor Relations Contact

Sean Mansouri, CFA
Elevate IR
(720) 330-2829
HNRG@elevate-ir.com