Nextech3D.ai Reports +157% Year to Date Revenue Growth

Rhea-AI Summary

Nextech3D.AI, a generative AI-powered 3D model supplier for major e-commerce retailers, reported a 155% increase in Q2 revenue compared to the same period last year. The company achieved record sales of $1.4 million in Q2 2023. They project a breakout Q3 quarter with revenue of $1.7 million. Nextech3D.AI has reduced its cash burn down to $300,000 and won't need to raise additional capital for the next 12 months. They have delivered over 50,000 3D models to date.

Positive

• Q2 revenue increased by 155% compared to the same period last year
• Record sales of $1.4 million in Q2 2023
• Projected revenue of $1.7 million for Q3
• Reduced cash burn down to $300,000
• Delivered over 50,000 3D models to date

Negative

• None.

Q2 & Six Months 2023 Financial Highlights

• Six months revenue up +157% compared to same period last year
• Q2 revenue up +155% compared to same period last year
• Q2 Gross profit remained consistent at 39%

TORONTO, ON / ACCESSWIRE / August 22, 2023 / Nextech3D.AI (formally "Nextech AR Solutions Corp'' or the "Company") (OTCQX:NEXCF)(CSE:NTAR)(FSE:EP2), a Generative AI-Powered 3D model supplier for Amazon, P&G, Kohls and other major e-commerce retailers is pleased to report its financial and operating results for its second quarter ended June 30, 2023.

Please join Evan Gappelberg, Chief Executive Officer and Andrew Chan, Chief Financial Officer after the close today August 22, 2023 at 5:00 P.M. ET where Nextech3D.ai will host a conference call to discuss these financial results.

Evan Gappelberg - CEO Commentary:

"Our results for Q2 were in line with our prelim numbers as we achieved record sales of $1.4 million +155% over Q2 2022. However, based on the current order flow from Amazon and others, we are projecting a breakout Q3 quarter with revenue of $1.7 million." He continued, "In Q3 we are not only seeing our revenue accelerate but our focused team has been successful in reducing our burn down to a minimum level that I have not seen in years. I'm excited to report to our loyal shareholders that with contributions from increased revenue and shares for services on an unconsolidated basis, we've reduced Nextech3D.ai's cash burn down to $300,000 which when combined with our recent capital raise, gives me the confidence in saying that we won't need to raise additional capital for the next 12 months. Nextech3D.ai's groundbreaking generative-AI technology positions the Company as a leading AI solution globally for scaling 3D model production in the thriving e-commerce, gaming, and manufacturing industries. Furthermore, thanks to our latest funding round, our cash position is now robust enough to accommodate the increased demand we anticipate in the second half of 2023 and beyond."

Unaudited Q2 2023 Financial Highlights:

• Three month quarterly revenue up +155% compared to same period last year;
• Sequential quarterly revenue grew 8%
• Delivery of over 50,000 3D models to date

6 Months Ending Ending June 30, 2023:

• Year to date revenue up +157% compared to same period last year;
• Gross profit remained consistent at 39%

Condensed Consolidated Interim Statements of Financial Position

As at
		June 30, 2023				December 31, 2022
Assets
Current assets
Cash & cash equivalents (Note 3)		$	3,810,323			$	3,777,117
Receivables (Note 4)			104,657				744,331
Deferred asset (Note 5)			211,641				256,818
Contract asset (Note 12)			199,546				332,197
Prepaid expenses			376,558				310,906
Inventory			-				45,289
Non current assets held for sale			-				501,188
			4,702,725				5,967,846
Non-current assets
Equipment (Note 6)			193,336				278,463
Deferred consideration (Note 14)			199,320				-
Deferred tax asset			191,306				-
Right of use asset (Note 7)			-				829,278
Finance lease receivable on sublease (Note 7)			914,665				-
Intangible assets (Note 8)			2,128,558				3,313,741
Goodwill (Note 8)			6,434,004				6,746,378
Total assets		$	14,763,914			$	17,135,706
Liabilities and Shareholders' Equity
Current liabilities
Accounts payable and accrued liabilities (Note 9)		$	3,899,601			$	2,641,918
Deferred revenue (Note 12)			281,044				437,746
Lease liability (Note 7)			176,328				222,250
Liabilities associated with assets held for sale							92,532
			4,356,973				3,394,446
Non-current liabilities
Lease liability (Note 7)			514,297				582,586
Deferred income tax liability			-				29,974
Total liabilities			4,871,270				4,007,006
Shareholders' Equity
Share capital (Note 10)			87,677,731				83,271,707
Reserves			16,238,629				12,754,706
Accumulated Other Comprehensive Income			1,184,974				827,101
Shareholder's equity attributable to Nextech shareholders			(97,867,520)				(85,898,862)
Total common shareholders' equity			7,233,814				10,954,652
Non controlling interest			2,658,830				2,174,048
Total equity			9,892,644				13,128,700
Total liabilities and shareholders' equity		$	14,763,914			$	17,135,706

Condensed Consolidated Interim Statements of Comprehensive Loss

		Three months ended				Three months ended				Six months ended				Six months ended
		June 30, 2023				June 30, 2022				June 30, 2023				June 30, 2022
						Revised (Note 2)								Revised (Note 2)
Revenue (Note 12)		$	1,405,003			$	551,945			$	2,706,197			$	1,062,156
Cost of sales (Note 13)			(875,033)				(347,303)				(1,642,341)				(601,786)
Gross profit			529,970				204,642				1,063,856				460,370
Operating expenses:
Sales and marketing (Note 13)			1,358,985				1,249,004				3,009,293				2,901,712
General and administrative (Note 13)			2,673,998				3,941,315				5,265,627				6,963,302
Research and development (Note 13)			877,262				880,272				1,757,166				1,907,466
Stock based compensation (Note 10)			1,084,471				878,286				2,255,142				1,457,091
Amortization (Note 8)			500,094				750,429				1,030,753				1,478,807
Depreciation (Note 6)			15,546				31,580				44,877				63,239
Right of use amortization (Note 7)			(118)				19,227				55,728				38,453
			6,510,238				7,750,113				13,418,586				14,810,070
Other expense (income)
Loss (gain) on disposition (Note 14)			(34,830)				-				160,149				-
Impairment of goodwill (Note 14)			-				-				184,097				-
Impairment of intangible assets			-				2,702,313				-				2,702,313
Foreign exchange gain (loss)			743,127				(843,903)				649,165				(402,023)
			708,297				1,858,410				993,411				2,300,290
Loss before income taxes			(6,688,565)				(9,403,881)				(13,348,141)				(16,649,990)
Current income tax expense			(9,019)				(7,128)				(18,039)				(14,256)
Deferred income tax recovery			98,639				121,852				203,306				260,785
Net loss from operations		$	(6,598,945)			$	(9,289,157)			$	(13,162,874)			$	(16,403,461)
Income (loss) from discontinued operations		$	-				295,605			$	-			$	(293,636)
Other comprehensive loss
Exchange differences on translating foreign operations, continuing operations			454,321				11,126				357,873				11,126
Exchange differences on translating foreign operations, discontinued operations			-				(1,571)				-				(26,258)
Total comprehensive loss		$	(6,144,624)			$	(8,983,997)			$	(12,805,001)			$	(16,712,229)
Non controlling interests			(494,717)				-				(1,194,216)				-
Total comprehensive loss attributable to Nextech shareholders		$	(5,649,907)			$	(8,983,997)			$	(11,610,785)			$	(16,712,229)
Income (loss) per common share
Basic and diluted loss per common share, continuing operations			(0.06)				(0.09				(0.11				(0.17)
Basic and diluted loss per common share, discontinued operations			-				-				-				-
Weighted average number of common shares outstanding Basic and diluted			109,766,574				99,725,256				108,353,964				98,334,837

Condensed Consolidated Interim Statements of Cash Flows

		Three months ended				Three months ended				Six months ended				Six months ended
		June 30, 2023				June 30, 2022				June 30, 2023				June 30, 2022
						Revised (Note 2)								Revised (Note 2)
Cashflows from operating activities
Net loss, continuing operations		$	(6,598,945)			$	(9,289,157)			$	(13,162,874)			$	(16,403,461)
Net loss, discontinuing operations							295,605				-				(293,636)
Items not affecting cash
Amortization of intangible assets			500,094				750,429				1,030,753				1,478,807
Deferred income tax recovery			(98,639)				(121,852)				(203,306)				(260,785)
Impairment of intangible assets & goodwill			-				2,702,313				184,097				2,702,313
Amortization of right to use asset			(118)				19,227				55,728				38,453
Finance income on sublease			41,576				-				41,567				-
Depreciation of property and equipment			15,546				31,580				44,877				63,239
Employee pay program			(84,506)				148,500				225,087				865,566
Treasury shares for employee pay program			-				-				(201,717)				-
Stock based compensation			1,084,471				878,286				2,255,142				1,457,091
Write off equipment			-				-				85,679				-
Deferred consideration receivable on sale of PET			5,910				-				(199,320)				-
Gain on write off of right of use assets			(120,626)				-				(120,626)				-
Changes in non-cash working capital balances
Receivables			836,414				600,222				706,634				662,372
Deferred asset			56,281				(153,185)				45,177				(153,185)
Contract asset			53,928				(68,653)				132,651				192,567
Prepaid expenses			16,836				362,636				(35,827)				217,305
Inventory			-				160,434				434,765				1,022,339
Accounts payable and accrued liabilities			(1,148,207)				739,778				(1,131,989)				(109,080)
Deferred revenue			(258,268)				(200,758)				(156,702)				(186,861)
Deferred tax liability			-				-				-				-
Cashflows from operating activities, continuing operations		$	(5,698,253)			$	(2,605,203)			$	(9,970,204)			$	(8,496,077)
Cashflows from operating activities, discontinued operations			-				(792,705)				-				(210,879)
Cashflows from investing activities
Purchase of equipment			(7,603)				(37,485)				(36,603)				(84,038)
Purchase of short term investments			-				-								-
Interest on lease liability			(7,122)				(6,890)				(13,945)				(13,602)
Net cash provided by (used in) investing activities, continuing operations		$	(14,725)			$	(38,685)			$	(50,548)			$	(86,756)
Net cash provided by (used in) investing activities, discontinued operations			-				(5,690)				-				(10,884)
Cashflows from financing activities
Proceeds from Employee Pay Program			701,794				-				2,281,014				-
Proceeds from private placement, net of issuance costs			(6,350)				1,910				2,645,380				8,938,406
Payment of lease obligations			19,801				(74,369)				(111,698)				(147,767)
Receivables financing (net)			2,297,143				-				2,297,143				-
Issuances to non controlling interest, net of issuance costs			2,277,289				-				2,364,037				-
Net cash provided by (used in) financing activities, continuing operations		$	5,289,677			$	(43,090)			$	9,475,876			$	8,893,406
Net cash provided by (used in) financing activities, discontinued operations			-				(29,369)				-				(102,767)
Change in cash during the period			(423,301)				(3,514,742)				(544,876)				(13,957)
Cash, beginning of period			3,502,217				10,781,775				3,786,493				7,237,296
Effects of foreign exchange on cash			731,407				(203,765)				568,706				(160,072)
Cash, end of period, continuing operations			3,810,323				6,048,083				3,810,323				6,048,083
Cash, end of period, discontinued operations			-				1,015,185				-				1,015,185
Cash, end of period		$	3,810,323			$	7,063,268			$	3,810,323			$	7,063,268
Supplemental cash flow information
Taxes paid			21,607				(224)				22,407				21,571
Interest paid			11,221				9,022				16,688				17,857
Interest received			17,766				11,956				51,555				39,329

Earnings Call Details

Title: Nextech3D.ai 2023 Second Quarter Earnings & Conference Call
Call Date: Tuesday, August 22, 2023
Time: 5:00PM (GMT-04:00) Eastern Time (US and Canada)

Participant Details

Participant Toll-Free Dial-In Number: 1 (888) 330-2024
Participant Toll Dial-In Number: 1 (646) 960-0187
Conference ID: 7778367
Webcast Link: https://events.q4inc.com/attendee/996074403

For those unable to join the live event, a recording of the presentation will be posted on the Company's IR website.

Update on Previously Announced Warrant Issuances

The Company previously announced on July 13, 2023 that in order to manage its cash flow and reduce or possibly eliminate its dependency of raising capital for payroll or contractor expenses it has renewed its previous share purchase warrant program pursuant to which, over the ensuing 12 month period, it will issue an aggregate of 6,661,388 share purchase warrants (the "Warrants") to its service providers in connection with their employment and/or consulting arrangements with the Company. Each Warrant will be exercisable to acquire one common share of the Company (an "Underlying Share") at an exercise price of Cdn$0.55 for a period of one year. The Company has now issued these warrants as of August 21, 2023.

Recent News

• Nextech3D.ai Announces New Production Record Having Delivered More Than 50,000 3D Models
• Nextech3D.ai Provides Earnings Call Details for Q2 2023 Financial Results August 22nd
• Nextech3D.ai Reports Record Preliminary Q2 Revenue Up +155% To $1.4Mill & Guides Towards Breakout Q3 Revenue +200% of $1.7Mill - $1.9Mill Amid Surging 3D Model Demand

The Public Company CEO Experience Podcast

Nextech3D.ai has recently "The Public Company CEO Experience Podcast," featuring Evan Gappelberg, a highly accomplished three-time public company CEO and serial entrepreneur. The podcast offers listeners an exclusive behind-the-scenes look into the dynamic life of a public company CEO with valuable insights, while also discussing trending topics and providing business updates on Nexech3D.ai, Toggle3D.ai, and ARway.ai. To learn more please visit https://www.nextechar.com/investors/the-ceo-experience

Listen Now
https://publiccompanyceoexperience.buzzsprout.com/

Subscribe
https://www.nextechar.com/the-ceo-experience/subscribe

About Nextech3D.ai

Nextech3D.ai, formerly known as "Nextech AR Solutions Corp" or the "Company," (OTCQX:NEXCF)(CSE:NTAR)(FSE:EP2), is a versatile augmented reality and AI technology company that utilizes its proprietary artificial intelligence (AI) to craft immersive 3D experiences at scale for E-COMMERCE. The Company's primary focus lies in creating high-quality 3D WebAR photorealistic models for Amazon and various other online retailers. Nextech3D.ai has adopted a unique approach to creating shareholder value beyond its operating business of creating 3D models.

The Company also develops or acquires disruptive AI-technologies, which are subsequently spun out to shareholders as standalone public companies. This spin-out strategy allows Nextech3D.ai to issue stock dividends to its shareholders while maintaining significant ownership in the public spin-out, without dilution to the parent company Nextech3D.ai.

Notably, Nextech3D.ai successfully spun out "ARway," (OTCQB:ARWYF)(CSE:ARWY) its spatial computing platform, as a standalone public company on October 26, 2022. The Company retains a 49% stake with 13 million shares in ARway Corp. while distributing 4 million shares to Nextech AR shareholders.

Similarly, Nextech3D.ai accomplished its second spin-out launching Toggle3D.ai, (OTC:TGGLF)(CSE:TGGL) an AI-powered 3D design studio aimed at competing with Adobe. The Company retains a 44% stake with 13 million shares in Toggle3D.ai Corp.

To learn more, please follow us on Twitter, YouTube, Instagram, LinkedIn, and Facebook, or visit our website: https://www.Nextechar.com.

For further information, please contact:

Investor Relations Contact
Lindsay Betts
investor.relations@Nextechar.com
866-ARITIZE (274-8493) Ext 7201

Nextech3D.ai

Evan Gappelberg
CEO and Director
866-ARITIZE (274-8493)

Forward-looking Statements

The CSE has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Certain information contained herein may constitute "forward-looking information" under Canadian securities legislation. Generally, forward-looking information can be identified by the use of forward-looking terminology such as, "will be" or variations of such words and phrases or statements that certain actions, events or results "will" occur. Forward-looking statements regarding the completion of the transaction are subject to known and unknown risks, uncertainties and other factors. There can be no assurance that such statements will prove to be accurate, as future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward-looking information. Nextech will not update any forward-looking statements or forward-looking information that are incorporated by reference herein, except as required by applicable securities laws.

SOURCE: Nextech3D.ai

View source version on accesswire.com:
https://www.accesswire.com/776017/Nextech3Dai-Reports-157-Year-to-Date-Revenue-Growth

FAQ

What is the company name?

The company's name is Nextech3D.AI.

What is Nextech3D.AI's main business?

Nextech3D.AI is a generative AI-powered 3D model supplier for major e-commerce retailers.

What was the revenue growth in Q2 2023 compared to the same period last year?

The revenue in Q2 2023 increased by 155% compared to the same period last year.

What were the Q2 2023 sales?

The company achieved record sales of $1.4 million in Q2 2023.

What is the projected revenue for Q3?

The projected revenue for Q3 is $1.7 million.

Has the company reduced its cash burn?

Yes, Nextech3D.AI has reduced its cash burn down to $300,000.

How many 3D models has Nextech3D.AI delivered?

Nextech3D.AI has delivered over 50,000 3D models to date.