Agrify Corporation Announces Results for First Quarter 2024
Agrify (Nasdaq: AGFY), a leading provider of cultivation and extraction solutions for the cannabis industry, announced its financial results for Q1 2024. Revenue fell to $2.6 million, down from $5.8 million in Q1 2023. However, the company achieved a near break-even quarter, with a net loss of $0.04 million compared to a $10 million loss in Q1 2023. Gross profit slightly decreased to $0.73 million from $1 million in the same period last year. Operating loss was significantly reduced to $0.8 million from $7.6 million in Q1 2023. Agrify credited increased sales of extraction products and consumables, alongside a renewed interest in its VFU technology among multi-state operators, for the improved financial performance.
- Operating loss reduced to $0.8 million in Q1 2024 from $7.6 million in Q1 2023.
- Net loss significantly decreased to $0.04 million in Q1 2024 from $10 million in Q1 2023.
- Gross profit was $0.73 million, a minor decrease from $1 million in Q1 2023, still maintaining profitability.
- Increased sales of extraction products and consumables.
- Renewed interest in VFU technology, especially among multi-state operators.
- Revenue dropped to $2.6 million in Q1 2024 from $5.8 million in Q1 2023.
Insights
Agrify Corporation's financial results for the first quarter of 2024 present a mixed yet overall positive picture when compared to the same period last year. Revenue decreased significantly from
Operating loss saw a significant reduction, dropping from
The gross profit for the quarter was
Long-term prospects appear promising especially if the company continues to cut costs and boost efficiencies. Investors should closely monitor subsequent quarters to confirm if this trend persists.
Agrify's performance highlights some noteworthy industry trends. The significant drop in revenue coupled with a substantial decrease in net loss suggests a shift in market dynamics. The uptick in extraction sales among prominent multi-state operators (MSOs) indicates a growing demand for high-quality cannabis products, which could benefit Agrify in the long run.
The rise in consumable and part sales signals that operators are increasingly investing in new equipment due to a diminishing supply of second-hand machinery. This could present sustained demand for Agrify's products, especially if the market continues to mature and operators seek to upgrade technology to stay competitive.
The success of Agrify's customer using their VFU technology in Las Vegas may serve as a strong case study, potentially driving future sales. This could enhance Agrify's market position as a provider of advanced cultivation solutions.
An important aspect for investors to consider is the impact of market regulation and potential changes in cannabis policy, which could influence future demand and sales trends.
The interest in Agrify's Vertical Farming Units (VFUs) is particularly intriguing from a technology perspective. VFUs offer advanced cultivation technology, which enhances flower quality, making them attractive to operators who aim to maximize yield and product quality.
This technology adoption indicates a trend towards more sophisticated farming methods within the cannabis industry. As growers seek to optimize their operations, Agrify's innovative solutions could become more popular. This bodes well for the company's future growth and market penetration.
Investors should find comfort in Agrify's potential for innovation-led growth. The company's ability to deliver technology that directly contributes to the success of their clients' operations could provide a sustainable competitive edge.
However, it's essential to consider the pace of technology adoption in the industry, as slower adoption rates could pose a challenge to revenue growth in the short term.
Company achieves near break-even quarterly results
TROY, Mich., May 21, 2024 (GLOBE NEWSWIRE) -- Agrify Corporation (Nasdaq:AGFY) (“Agrify” or the “Company”), a leading provider of innovative cultivation and extraction solutions for the cannabis industry, today announced financial results for the first quarter ended March 31, 2024.
First Quarter 2024 Financial Results Summary
- Revenue was
$2.6 million for the first quarter of 2024, compared to$5.8 million for the first quarter of 2023. - Gross profit was
$0.73 million for the first quarter of 2024, compared to a gross profit of$1 million for the first quarter of 2023. - Operating loss was
$0.8 million for the first quarter of 2024, compared to$7.6 million in the first quarter of 2023. - Net loss for the first quarter of 2024 was
$0.04 million , compared to$10 million in the first quarter of 2023.
"Following our first positive quarter in the fourth quarter of 2023, we are pleased to witness a sustained improvement in our business, marking another near break-even quarter. We have observed a notable uptick in extraction sales, particularly among prominent multi-state operators (MSOs). Additionally, consumable and part sales are on the rise as the supply of second-hand equipment diminishes, compelling operators to upgrade or replace their existing machinery. The success of our customer’s Las Vegas facility using our VFU technology has reignited interest in our VFUs, attracting both new and existing operators seeking advanced cultivation technology to enhance flower quality" stated Raymond Chang, Chairman and CEO of Agrify.
About Agrify (Nasdaq:AGFY)
Agrify is a leading provider of innovative cultivation and extraction solutions for the cannabis industry, bringing data, science, and technology to the forefront of the market. Agrify’s proprietary micro-environment-controlled Vertical Farming Units (VFUs) enable cultivators to produce the highest quality products with unmatched consistency, yield, and ROI at scale. Agrify’s comprehensive extraction product line, which includes hydrocarbon, ethanol, solventless, post-processing, and lab equipment, empowers producers to maximize the quantity and quality of extract required for premium concentrates. For more information, please visit Agrify at http://www.agrify.com.
AGRIFY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
| Three months ended March 31, | ||||||||
| 2024 | 2023 | |||||||
| Revenue (including | $ | 2,598 | $ | 5,804 | ||||
| Cost of goods sold | 1,869 | 4,816 | ||||||
| Gross profit | 729 | 988 | ||||||
| General and administrative | 2,952 | 6,931 | ||||||
| Selling and marketing | 462 | 1,590 | ||||||
| Research and development | 275 | 735 | ||||||
| Change in contingent consideration | (2,180 | ) | (684 | ) | ||||
| Total operating expenses | 1,509 | 8,572 | ||||||
| Loss from operations | (780 | ) | (7,584 | ) | ||||
| Interest expense, net | (145 | ) | (799 | ) | ||||
| Change in fair value of warrant liabilities | 873 | 2,672 | ||||||
| Loss on extinguishment of long-term debt, net | — | (4,620 | ) | |||||
| Other income, net | 14 | 4 | ||||||
| Total other income (expense), net | 742 | (2,743 | ) | |||||
| Net loss before income taxes | (38 | ) | (10,327 | ) | ||||
| Income tax benefit (expense) | — | — | ||||||
| Net loss | (38 | ) | (10,327 | ) | ||||
| Net loss attributable to Agrify Corporation | $ | (38 | ) | $ | (10,327 | ) | ||
| Net loss per share attributable to Common Stockholders – basic and diluted (1) | $ | — | $ | (9.63 | ) | |||
| Weighted average common shares outstanding - basic and diluted (1) | 8,894,229 | 1,072,292 | ||||||
(1) Periods presented have been adjusted to reflect the 1-for-20 reverse stock split on July 5, 2023. Additional information regarding reverse stock splits may be found in Note 1 – Overview, Basis of Presentation, and Significant Accounting Policies, included elsewhere in the notes to the consolidated financial statements.
AGRIFY CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
| March 31, | December 31, | ||||||
| 2024 | 2023 | ||||||
| Assets | (Unaudited) | ||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 95 | $ | 430 | |||
| Marketable securities | 4 | 4 | |||||
| Accounts receivable, net of allowance for credit losses of | 211 | 1,149 | |||||
| Inventory, net of reserves of | 18,862 | 19,094 | |||||
| Loan receivable, current | 692 | — | |||||
| Prepaid expenses and other current assets | 1,028 | 3,332 | |||||
| Total current assets | 20,892 | 24,009 | |||||
| Loan receivable, net of allowance for credit losses of | 10,891 | 11,583 | |||||
| Property and equipment, net | 7,328 | 7,734 | |||||
| Operating lease right-of-use assets | 1,651 | 1,803 | |||||
| Other non-current assets | 99 | 141 | |||||
| Total assets | $ | 40,861 | $ | 45,270 | |||
| Liabilities and Stockholders' Deficit | |||||||
| Current liabilities: | |||||||
| Accounts payable | $ | 12,428 | $ | 20,766 | |||
| Accrued expenses and other current liabilities | 7,843 | 10,655 | |||||
| Operating lease liabilities, current | 615 | 599 | |||||
| Notes payable, current | 1,374 | — | |||||
| Long-term debt, current | 696 | 766 | |||||
| Related party debt, current | 1,000 | 4,444 | |||||
| Deferred revenue | 3,784 | 4,019 | |||||
| Total current liabilities | 27,740 | 41,249 | |||||
| Warrant liabilities | 417 | 1,290 | |||||
| Operating lease liabilities, net of current | 1,235 | 1,394 | |||||
| Notes payable, net of current | 3,464 | — | |||||
| Related party debt, net of current | 17,683 | — | |||||
| Long-term debt, net of current | 47 | 16,047 | |||||
| Total liabilities | 50,586 | 59,980 | |||||
| Stockholders' deficit: | |||||||
| Common Stock, | 13 | 2 | |||||
| Preferred Stock, | — | — | |||||
| Preferred A Stock, | — | — | |||||
| Additional paid-in capital | 255,867 | 250,855 | |||||
| Accumulated deficit | (265,835 | ) | (265,797 | ) | |||
| Total stockholders' deficit attributable to Agrify | (9,955 | ) | (14,940 | ) | |||
| Non-controlling interests | 230 | 230 | |||||
| Total liabilities and stockholders' deficit | $ | 40,861 | $ | 45,270 | |||
(1) Periods presented have been adjusted to reflect the 1-for-20 reverse stock split on July 5, 2023. Additional information regarding the reverse stock splits may be found in Note 1 – Overview, Basis of Presentation, and Significant Accounting Policies, included in the notes to the consolidated financial statements
AGRIFY CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(In thousands)
| Three months ended March 31, | ||||||||
| 2024 | 2023 | |||||||
| (Unaudited) | ||||||||
| Cash flows (used in) provided by: | ||||||||
| Operating activities | $ | (2,987 | ) | $ | (9,469 | ) | ||
| Investing activities | 328 | 9,795 | ||||||
| Financing activities | 2,324 | (9,307 | ) | |||||
| Net (decrease) in cash and cash equivalents | $ | (335 | ) | $ | (8,981 | ) | ||
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 concerning Agrify and other matters. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements including, without limitation, statements regarding future financial results, the potential for increased extraction sales, the ability to realize revenue from the bookings, backlog, and pipeline, project timelines, and Agrify’s ability to deliver solutions and services. In some cases, you can identify forward-looking statements by terms such as "may," "will," "should," "expects," "plans," "anticipates," "could," "intends," "targets," "projects," "contemplates," "believes," "estimates," "predicts," "potential" or "continue" or the negative of these terms or other similar expressions. The forward-looking statements in this press release are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. You should carefully consider the risks and uncertainties that affect our business, including those described in our filings with the Securities and Exchange Commission (“SEC”), including under the caption “Risk Factors” in our Annual Report on Form 10-K filed for the year ended December 31, 2023 with the SEC, which can be obtained on the SEC website at www.sec.gov. These forward-looking statements speak only as of the date of this communication. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements, whether as a result of any new information, future events or otherwise. You are advised, however, to consult any further disclosures we make on related subjects in our public announcements and filings with the SEC.
Company Contacts
Agrify Investor Relations
IR@agrify.com
(857) 256-8110
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