ConnectM Issues Stockholder Letter from CEO & Chairman

Rhea-AI Summary

ConnectM Technology Solutions (NASDAQ: CNTM) released a stockholder letter highlighting significant achievements since its July 2024 IPO. The company reported strong financial growth with Q3 2024 revenue up 36% to $6.1M and projected Q4 2024 revenue of $9.0M, representing a 100% increase year-over-year. Full-year 2024 revenue is expected to reach $26.4M, up 32% from 2023.

The company's technological innovations include the Energy Intelligence Network (EIN), an AI-Powered Heat Pump with AHRI Cold Climate Certification, and an Automotive Graphics Visual Unit. Strategic acquisitions of DeliveryCircle, Green Energy Gains, and MHz Invensys have expanded their market reach and capabilities.

ConnectM has optimized its balance sheet by reducing total liabilities by $31M, including a $13.7M debt-to-equity swap and cutting annual interest expense by $2M. The company's environmental impact shows significant growth, with 95.5 GWh of electrification and 73,506 metric tons of CO2 displaced in 2024.

Positive

• Q3 2024 revenue increased 36% YoY to $6.1M
• Projected Q4 2024 revenue growth of 100% YoY to $9.0M
• Full-year 2024 revenue projected to increase 32% to $26.4M
• Reduced total liabilities by $31M since IPO
• Decreased annual interest expense by $2M
• Management purchased 700,000+ common shares post-IPO
• Secured No. 104 spot on Inc. 5000 list

Negative

• Significant debt restructuring needed with $13.7M debt-to-equity swap
• Currently operating with negative stockholder equity

Insights

Financial Analyst

ConnectM's letter reveals impressive revenue momentum with 36% YoY growth in Q3 2024 ($6.1 million), projected 100% growth in Q4 ($9.0 million), and anticipated 32% growth for full-year 2024 ($26.4 million). The Q1 2025 projection of $11.3 million indicates an accelerating $45.2 million annualized run rate.

The company's balance sheet optimization is noteworthy, having reduced liabilities by $31 million since going public. This includes a strategic debt-to-equity conversion of $13.7 million at $2.00 per share and $2.5 million in additional debt retirement in Q1 2025. These moves have cut annual interest expenses by over $2 million, improving free cash flow for operational investments.

The acquisition strategy appears targeted at expanding capabilities across complementary markets. DeliveryCircle provides access to the last-mile logistics vertical, while Green Energy Gains strengthens ConnectM's heat pump distribution channels. MHz Invensys is expected to generate $15 million in additional revenue over three years from the smart metering vertical.

Management's purchase of 700,000+ shares demonstrates alignment with stockholder interests. However, the company's stated goal to achieve just $5 million in positive stockholder equity by end-2025 seems modest relative to current operations. The focus remains heavily on revenue growth metrics rather than profitability milestones, which would provide a more complete picture of financial health.

Technology Analyst

ConnectM is positioning itself at the intersection of energy management and AI with three key technological innovations. The Energy Intelligence Network (EIN) represents a comprehensive platform approach to monitoring electrified assets throughout their lifecycle. This creates a potentially valuable data flywheel effect where performance data continuously improves AI models and network efficacy.

Their AI-powered heat pump system addresses a critical market limitation by earning AHRI Cold Climate Certification. Traditional heat pumps struggle in colder environments, so this certification signifies ConnectM has overcome a significant technical hurdle. The integration with their EIN platform creates a connected ecosystem rather than a standalone product.

The Automotive Graphics Visual Unit (AGVU) demonstrates ConnectM's expansion into electrified micro-mobility, balancing cost considerations with advanced features like real-time responsiveness and data visualization. This hardware element complements their software-focused offerings.

The MHz Invensys acquisition enhances wireless communication capabilities specifically for smart metering/Advanced Metering Infrastructure. This vertical expansion strengthens ConnectM's position in the utility monitoring space.

ConnectM's environmental impact metrics are substantial, with 331% increase in electrification impact (95.5 GWh) and 391% increase in CO2 displacement (73,506 metric tons). These metrics demonstrate the scale at which their technology is being deployed and its tangible environmental benefits. The company's technological approach appears focused on creating an interconnected ecosystem of hardware, software, and data analytics across multiple electrification verticals.

MARLBOROUGH, Mass., March 25, 2025 /PRNewswire/ -- ConnectM Technology Solutions, Inc. (Nasdaq: CNTM) ("ConnectM" or the "Company"), a high-growth technology company on the leading edge of the energy economy, today issued the following letter to stockholders from Bhaskar Panigrahi, Chief Executive Officer and Chairman:

Dear Valued ConnectM Stockholders,

As we mark our first eight months as a publicly traded company, I am pleased to share our significant accomplishments and outline our strategic vision for the future. Since our public debut on July 15, 2024, we have made remarkable strides in revenue growth, technological innovation, strategic acquisitions, and balance sheet optimization. I want to express my gratitude for your continued support and confidence in our mission.

Strong Revenue Growth

Our financial performance demonstrates the market's enthusiastic response to our innovative solutions:

• Q3 2024 revenue increased 36% to $6.1 million, compared to $4.45 million in Q3 2023
  
  
• Q4 2024 revenue is projected to increase 100% to $9.0 million, compared to $4.49 million in Q4 2023
  
  
• Full-year 2024 revenue is projected to increase 32% to $26.4 million, compared to $19.97 million in 2023
  
  
• Q1 2025 projected revenue of $11.3 million puts the company at a $45.2 million annualized revenue run rate

Technological Innovation

At ConnectM, we remain committed to developing cutting-edge technologies that drive the transition to sustainable energy solutions:

Energy Intelligence Network (EIN) – Our comprehensive technology platform monitors and manages electrified assets throughout their lifecycle, collecting anonymized performance data to refine AI models while continuously improving network performance. This infrastructure enables OEMs, service providers, and consumers to increase revenue and margins while also doing good for the planet.

AI-Powered Heat Pump – Our intelligent heat pump system for residential and light commercial use integrates with our EIN platform and features an IoT-enabled AI engine powered by a large language model trained on proprietary and public data. We are proud that this system has received the prestigious AHRI Cold Climate Certification, demonstrating superior heating efficiency in cold environments where traditional heat pumps struggle.

Automotive Graphics Visual Unit (AGVU) – This automotive-grade instrument cluster balances cost, performance, and durability with features including real-time responsiveness, advanced data visualization, and screen mirroring capabilities. The AGVU allows ConnectM to differentiate itself in the electrified micro-mobility space.

Strategic Acquisitions

We have executed several strategic acquisitions that expand our capabilities and market reach:

DeliveryCircle – This nationwide technology-enabled final-mile delivery company connects businesses with a network of over 500,000 drivers. This acquisition marks ConnectM's expansion into the last-mile transportation and logistics vertical, representing an adjacent electrification opportunity to our current markets.

Green Energy Gains – This all-stock transaction strengthens our portfolio with home energy assessment capabilities and expands the customer base for our AI-powered heat pump. It also provides access to a local partner ecosystem of HVAC contractors, creating a distribution channel for our products.

MHz Invensys – This acquisition bolsters our capabilities in wireless communication, particularly in the smart metering/Advanced Metering Infrastructure (AMI) vertical. We expect to generate an additional $15 million in revenue from the AMI vertical alone over the next three years.

Balance Sheet Optimization

Since going public, we have prioritized deleveraging our balance sheet.

• Reduced total liabilities by $31 million since our public debut:
  • Completed a debt-to-equity swap converting $13.7 million of outstanding debt to common equity at $2.00 per share
  • Reduced annual interest expense by more than $2 million, increasing free cash flow for operational investments
  • Retired an additional $2.5 million in debt during Q1 2025

We have initiated several strategic activities intended to surpass $5 million in positive stockholder equity by the end of 2025.

Environmental Impact

Our Electrification Impact Scorecard for year-end 2024 highlights our contribution to a sustainable future:

• 95.5 GWh of electrification, a 331% increase compared to last year, equivalent to powering 35,000 homes daily
• 73,506 metric tons of CO2 displaced, a 391% increase compared to last year, equivalent to the CO2 absorption of 3.4 million trees in a year
• 6.7 million gallons of fossil fuel displaced, a 343% increase compared to last year, equivalent to driving around the world approximately 7,000 times

Industry Recognition

ConnectM secured the No. 104 spot on the Inc. 5000 list of fastest-growing private companies in America, ranking No. 5 among energy companies and No. 4 in Massachusetts. This marks our third consecutive year on this esteemed list, with remarkable growth over the past three years.

Management's Alignment with Stockholders

As a demonstration of our confidence in ConnectM's future, I and other members of the management team purchased more than 700,000 common shares during open trading windows since the IPO. This underscores management's alignment with stockholders and our shared belief in the growth trajectory of the Company.

Looking Forward

I have a strong conviction that the future is bright for ConnectM. My team and I are focused on continuing to grow revenue, increase profitability, and take category leadership positions across our operating segments. As you can see by our aligned investment interest, we are committed to creating meaningful catalysts for growth with the goal of increasing long-term value for all stockholders.

Thank you for your continued support and confidence in ConnectM.

Sincerely,

Bhaskar Panigrahi
CEO & Chairman
ConnectM Technology Solutions, Inc.

About ConnectM Technology Solutions, Inc.

ConnectM is a constellation of companies powering the next generation of electrified equipment, mobility and distributed energy—thus enabling a faster, smarter transition to a modern energy economy. The Company provides residential and light commercial service providers and original equipment manufacturers with a proprietary Energy Intelligence Network platform to accelerate the transition to all-electric heating, cooling, and transportation. Leveraging technology, data, artificial intelligence, and behavioral economics, ConnectM aims to lower energy costs and reduce carbon emissions globally.

For more information, please visit: https://www.connectm.com/

Cautionary Note Regarding Forward-Looking Statements 
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). We have based these forward-looking statements on our current expectations and projections about future events. All statements, other than statements of present or historical fact included in this press release, regarding our future financial performance and our strategy, expansion plans, future operations, future operating results, estimated revenues, losses, projected costs, prospects, plans and objectives of management are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as "may," "should," "could," "would," "expect," "plan," "anticipate," "intend," "believe," "estimate," "continue," "project" or the negative of such terms or other similar expressions. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this press release. We caution you that the forward-looking statements contained herein are subject to numerous risks and uncertainties, most of which are difficult to predict and many of which are beyond our control. In addition, we caution you that the forward-looking statements regarding the Company contained in this press release are subject to the risks and uncertainties described in the "Cautionary Note Regarding Forward-Looking Statements" section of the Current Report on Form 8-K filed with the Securities and Exchange Commission on July 18, 2024. Such filing identifies and addresses other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and ConnectM is under no obligation to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise.

Contact:
Investor Relations
Dave Gentry, CEO
RedChip Companies, Inc.
1-407-644-4256
CNTM@redchip.com

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SOURCE ConnectM Technology Solutions, Inc.

FAQ

What is ConnectM's (CNTM) projected revenue for Q4 2024?

ConnectM projects Q4 2024 revenue of $9.0 million, a 100% increase from $4.49 million in Q4 2023.

How much debt has ConnectM (CNTM) reduced since its IPO in July 2024?

ConnectM has reduced total liabilities by $31 million since its public debut, including a $13.7M debt-to-equity swap.

What strategic acquisitions has ConnectM (CNTM) made since going public?

ConnectM has acquired DeliveryCircle, Green Energy Gains, and MHz Invensys to expand capabilities in last-mile delivery, home energy assessment, and wireless communication.

What was ConnectM's (CNTM) environmental impact in 2024?

In 2024, ConnectM achieved 95.5 GWh of electrification and displaced 73,506 metric tons of CO2, representing increases of 331% and 391% respectively.

How much stock has ConnectM's (CNTM) management team purchased since the IPO?

Management team members, including the CEO, have purchased over 700,000 common shares during open trading windows since the IPO.