ProPhase Labs, Inc. Announces Financial Results for the Year Ended December 31, 2024
ProPhase Labs (NASDAQ: PRPH) reported its financial results for FY2024, highlighting significant strategic restructuring. The company completed the sale of its Pharmaloz manufacturing operations for $23 million in January 2025, reducing employee headcount from 96 to 28.
Key financial results show a substantial decline, with net revenue decreasing 80.6% to $6.8 million in 2024 from $35.0 million in 2023. The company reported a net loss of $53.4 million ($2.61 per share) compared to a $16.8 million loss ($0.98 per share) in 2023.
Strategic developments include accelerating BE-Smart Esophageal Cancer test commercialization as a cash-pay diagnostic, with a target market of 7 million endoscopies annually ($7-14 billion market). The company has also restructured Nebula Genomics, now controlling a database of over 65,000 genomes, and entered a potential $50 million recovery opportunity with Crown Medical Collections.
ProPhase Labs (NASDAQ: PRPH) ha riportato i risultati finanziari per l'anno fiscale 2024, evidenziando una significativa ristrutturazione strategica. L'azienda ha completato la vendita delle operazioni di produzione Pharmaloz per 23 milioni di dollari a gennaio 2025, riducendo il numero di dipendenti da 96 a 28.
I risultati finanziari chiave mostrano un notevole declino, con ricavi netti in diminuzione dell'80,6% a 6,8 milioni di dollari nel 2024, rispetto ai 35,0 milioni di dollari del 2023. L'azienda ha riportato una perdita netta di 53,4 milioni di dollari (2,61 dollari per azione) rispetto a una perdita di 16,8 milioni di dollari (0,98 dollari per azione) nel 2023.
Gli sviluppi strategici includono l'accelerazione della commercializzazione del test diagnostico per il cancro esofageo BE-Smart come test a pagamento, con un mercato target di 7 milioni di endoscopie annuali (mercato da 7 a 14 miliardi di dollari). L'azienda ha anche ristrutturato Nebula Genomics, ora controllando un database di oltre 65.000 genomi, ed è entrata in un'opportunità di recupero potenziale di 50 milioni di dollari con Crown Medical Collections.
ProPhase Labs (NASDAQ: PRPH) informó sus resultados financieros para el año fiscal 2024, destacando una reestructuración estratégica significativa. La compañía completó la venta de sus operaciones de fabricación de Pharmaloz por 23 millones de dólares en enero de 2025, reduciendo el número de empleados de 96 a 28.
Los resultados financieros clave muestran un notable descenso, con ingresos netos que disminuyeron un 80,6% a 6,8 millones de dólares en 2024, desde 35,0 millones de dólares en 2023. La empresa reportó una pérdida neta de 53,4 millones de dólares (2,61 dólares por acción) en comparación con una pérdida de 16,8 millones de dólares (0,98 dólares por acción) en 2023.
Los desarrollos estratégicos incluyen la aceleración de la comercialización de la prueba diagnóstica para el cáncer esofágico BE-Smart como un diagnóstico de pago, con un mercado objetivo de 7 millones de endoscopias anuales (mercado de 7 a 14 mil millones de dólares). La compañía también ha reestructurado Nebula Genomics, controlando ahora una base de datos de más de 65,000 genomas, y ha entrado en una oportunidad de recuperación potencial de 50 millones de dólares con Crown Medical Collections.
프로페이즈 랩스 (NASDAQ: PRPH)는 FY2024에 대한 재무 결과를 발표하며, 중요한 전략적 구조 조정을 강조했습니다. 회사는 2025년 1월에 2300만 달러에 Pharmaloz 제조 운영을 매각하여 직원 수를 96명에서 28명으로 줄였습니다.
주요 재무 결과는 상당한 감소를 보여주며, 2024년 순매출이 2023년 3500만 달러에서 680만 달러로 80.6% 감소했습니다. 회사는 2023년 1주당 0.98달러 손실에 비해 1주당 2.61달러의 5340만 달러 순손실을 보고했습니다.
전략적 개발에는 BE-Smart 식도암 검사 상용화를 가속화하는 것이 포함되며, 이는 연간 700만 건의 내시경 검사 시장(70억~140억 달러 시장)을 목표로 하고 있습니다. 회사는 또한 65,000개 이상의 유전체 데이터베이스를 관리하는 Nebula Genomics를 재구성했으며, Crown Medical Collections과 함께 5000만 달러의 회수 기회를 모색하고 있습니다.
ProPhase Labs (NASDAQ: PRPH) a annoncé ses résultats financiers pour l'exercice 2024, mettant en avant une restructuration stratégique significative. L'entreprise a finalisé la vente de ses opérations de fabrication Pharmaloz pour 23 millions de dollars en janvier 2025, réduisant le nombre d'employés de 96 à 28.
Les résultats financiers clés montrent un déclin substantiel, avec un chiffre d'affaires net diminuant de 80,6 % pour atteindre 6,8 millions de dollars en 2024, contre 35,0 millions de dollars en 2023. L'entreprise a déclaré une perte nette de 53,4 millions de dollars (2,61 dollars par action) par rapport à une perte de 16,8 millions de dollars (0,98 dollars par action) en 2023.
Les développements stratégiques incluent l'accélération de la commercialisation du test diagnostique BE-Smart pour le cancer de l'œsophage en tant que diagnostic payant, avec un marché cible de 7 millions d'endoscopies par an (marché de 7 à 14 milliards de dollars). L'entreprise a également restructuré Nebula Genomics, contrôlant désormais une base de données de plus de 65 000 génomes, et est entrée dans une opportunité de récupération potentielle de 50 millions de dollars avec Crown Medical Collections.
ProPhase Labs (NASDAQ: PRPH) hat seine finanziellen Ergebnisse für das Geschäftsjahr 2024 veröffentlicht und eine bedeutende strategische Umstrukturierung hervorgehoben. Das Unternehmen hat im Januar 2025 den Verkauf seiner Pharmaloz-Produktionsbetriebe für 23 Millionen Dollar abgeschlossen und die Mitarbeiterzahl von 96 auf 28 reduziert.
Wichtige finanzielle Ergebnisse zeigen einen erheblichen Rückgang, wobei der Nettoumsatz 2024 um 80,6 % auf 6,8 Millionen Dollar gesunken ist, verglichen mit 35,0 Millionen Dollar im Jahr 2023. Das Unternehmen berichtete von einem Nettoverlust von 53,4 Millionen Dollar (2,61 Dollar pro Aktie) im Vergleich zu einem Verlust von 16,8 Millionen Dollar (0,98 Dollar pro Aktie) im Jahr 2023.
Strategische Entwicklungen umfassen die Beschleunigung der Kommerzialisierung des BE-Smart-Testes auf Speiseröhrenkrebs als kostenpflichtige Diagnose, mit einem Zielmarkt von 7 Millionen Endoskopien jährlich (Markt von 7 bis 14 Milliarden Dollar). Das Unternehmen hat auch Nebula Genomics umstrukturiert und kontrolliert nun eine Datenbank von über 65.000 Genomen und hat eine potenzielle Rückgewinnungsmöglichkeit von 50 Millionen Dollar mit Crown Medical Collections eingegangen.
- Sale of Pharmaloz manufacturing division for $23 million strengthening balance sheet
- Significant reduction in operational costs through headcount reduction from 96 to 28 employees
- BE-Smart diagnostic platform targeting $7-14 billion annual market opportunity
- Valuable genomics database with over 65,000 genomes across 130 countries
- Potential $50 million non-dilutive capital from Crown Medical Collections recovery
- Net revenue declined 80.6% to $6.8 million in 2024
- Net loss increased to $53.4 million in 2024 from $16.8 million in 2023
- Working capital decreased to -$1.5 million from $26.7 million year-over-year
- Cash and cash equivalents declined to $0.7 million from $1.6 million
- Gross margin turned negative at -2.2% compared to 44.5% in 2023
Insights
ProPhase Labs' 2024 financial results reveal a company in significant transition, with concerning financials but potentially promising strategic shifts. Revenue plummeted
Most alarming is the deteriorating balance sheet, with cash dropping to just
The workforce reduction from 96 to 28 employees represents a
The
While the immediate financial situation appears precarious, ProPhase has made decisive moves to streamline operations, eliminate underperforming segments, and focus on higher-potential assets. The effectiveness of this restructuring and the success of BE-Smart commercialization will determine whether this radical transformation can reverse the company's financial decline.
ProPhase's strategic pivot toward its BE-Smart Esophageal Cancer test represents a calculated bet on a potential breakthrough diagnostic. The test offers several clinical advantages - requiring just 1-2 biopsy tissue slices while providing disease severity assessment and progression prediction capabilities that exceed traditional methods.
The company's decision to initially launch BE-Smart as a cash-pay diagnostic follows a proven pathway used by other successful diagnostic companies like Castle Biosciences. This approach allows immediate market entry while pursuing more complex CPT coding and reimbursement channels.
The involvement of Dr. Joe Abdo (co-inventor) and GI pathology expert Dr. Christopher Hartley from Mayo Clinic adds scientific credibility. The pending publication of performance metrics in a peer-reviewed manuscript within 8-16 weeks will be crucial for clinical adoption.
What truly distinguishes BE-Smart is its proprietary multiplexing capability and exclusive IP on eight protein markers associated with disease progression to esophageal adenocarcinoma. These markers provide unique insights from tissue samples - a significant advantage over competing assays that require larger specimens.
The genomics database of 65,000 whole genomes across 130 countries represents an undervalued asset with potential applications in research partnerships, drug development, and diagnostic innovation. Unlike ancestry tests analyzing less than
While promising, the BE-Smart commercialization faces significant execution challenges - particularly establishing clinical adoption patterns, navigating the complex reimbursement landscape, and competing against entrenched diagnostic providers. The timeline from regulatory clearance to meaningful revenue remains uncertain.
Company to Accelerate BE-Smart Commercialization as a Cash-Pay Diagnostic
Significantly reduces overhead, improves margins heading into Q2 2025
Company to hold a conference call Monday, March 31, 2025, at 11:00 AM EST
GARDEN CITY, NY, March 31, 2025 (GLOBE NEWSWIRE) -- ProPhase Labs, Inc. (NASDAQ: PRPH), (the “Company” or “ProPhase”), a next generation biotech, genomics and consumer products company, today reported its financial and operational results for the full-year ended December 31, 2024 and outlined strategic corporate developments aimed at realigning the Company for sustained long-term growth, profitability, and strategic focus.
Ted Karkus, CEO of ProPhase Labs, will present to shareholders today, March 31, 2025, at 11:00 a.m. EST during the live Virtual Non-Deal Roadshow Series. The details are available below.
Following a year of operational reevaluation and bold decision-making, ProPhase has emerged with a significantly leaner structure, stronger balance sheet, and a renewed commitment to its core growth assets, including BE-Smart Esophageal Cancer test, Nebula Genomics/DNA Complete (with its proprietary genomic database) and its dietary supplements business.
Key Financial Milestone: Manufacturing Division Sold for
In January 2025, the Company completed the divestiture of its Pharmaloz manufacturing operations for approximately
BE-Smart Diagnostic Platform Launch
The Company has engaged Dr. Joe Abdo, former CEO of Stella Diagnostics and co-inventor of BE-Smart, in collaboration with our other consultants, to begin the commercialization of its high-performance assay for detection of esophageal diseases as a clinically available diagnostic test. BE-Smart is designed to deliver high accuracy using only 1–2 slices of biopsy tissue and can identify disease severity while also being predictive of progression, surpassing traditional diagnostics both in performance and utility.
Dr. Abdo is working alongside GI pathology expert Dr. Christopher Hartley, who leads the validation study at Mayo Clinic for BE-Smart. They, along with key stakeholders from multiple academic and clinical institutions, have presented compelling data nationwide and are currently preparing a peer-reviewed manuscript for publication to highlight the performance of BE-Smart.
The Company’s efforts are focused on producing a new manuscript that is currently in preparation that will provide a comprehensive overview of BE-Smart’s performance metrics. The manuscript is estimated to be submitted for peer-review within 4 to 8 weeks. We anticipate an additional 4 to 8 weeks for a decision on publication, following submission. Once published, this manuscript will reinforce the test’s efficacy and its advantages over existing diagnostics, further establishing its value to gastroenterologists and patients.
During the manuscript review and publication process, the Company will begin working on the next steps for commercialization. This includes exploring existing generic CPT codes to identify potential developmental paths for bringing BE-Smart to market. Similar to other diagnostic tests in the industry like Castle Biosciences’s TissueCypher, BE-Smart is expected to be launched initially as a cash-pay diagnostic for gastroenterologists while CPT coding is pursued. This will allow patients the choice for optimized esophageal screening with what the Company believes is the state-of-the-art diagnostic test. Despite the possibility of initial non-payment, this strategy will help initiate reimbursement discussions and increase the volume of tests ordered. Doctors can be assured that neither patients nor their clinics will face balance billing, ensuring a patient-friendly approach. Additionally, the Company will leverage our extensive network of key opinion leaders to connect with GI doctors and drive the promotion and adoption of the test at high impact conferences.
The Company believes that some competing assays in the space do not have the unique multiplexablility of BE-Smart, which allows for detection of many significant disease progressors from very little tissue. Availability of these small biopsies remains a significant limitation with outsourced testing which limits the success of other diagnostic tests. BE-Smart is also the only assay to have the IP on eight key protein markers that are expressed in diseases of the foregut and have been associated with disease progression, specifically into esophageal adenocarcinoma. Other cash based esophageal cancer diagnostic tests have had significant success recently even though they require a large amount of tissue and cannot see our proprietary and highly informative markers. This highlights the potential for BE-Smart. The target market for BE-Smart is approximately 7 million endoscopies, in the U.S. alone, that are performed on patients at higher risk each year. This equates to a
Nebula Genomics Overhaul & Strategic Review
ProPhase’s wholly-owned subsidiary Nebula Genomics, under new leadership from Jason Karkus, has been strategically restructured. Following the lab shutdown, the division has formed partnerships with multiple external genomic sequencing labs, each competing to deliver superior pricing and quality. As part of these efforts, and in coordination with recently-hired Stu Hollenshead as COO, the Company has significantly reduced IT and data expenses, streamlined payroll, and eliminated substantial ongoing operational costs. These cost-effective strategies have drastically improved margins, enhanced cash flow, and reduced execution risk. Additionally, the Company’s direct-to-consumer platform, DNA Complete, has been refined and positioned for growth. Under the guidance of Stu Hollenshead, targeted advertising campaigns are expected to significantly ramp up revenues and profitability for this subsidiary.
In parallel, the Company is exploring a potential sale of Nebula Genomics and is in the early stages of evaluating strategic options.
Nebula Genomics Genomic Database
ProPhase now controls a database of over 65,000 genomes across 130 countries and is actively growing. This is equivalent in scientific depth to over 150 million ancestry tests. While most consumer DNA ancestry tests analyze less than
ProPhase has entered into a new revenue initiative with Crown Medical Collections. Crown estimates the recovery of approximately
A Unified Future: Supplements, Telehealth, and Cross-Sell Synergies
With infrastructure now in place across DNA Complete, BE-Smart, and ProPhase’s dietary supplement line, the Company is considering the launch of an integrated telehealth initiative. Several early-stage companies have approached ProPhase, and discussions are underway to leverage these partnerships and cross-sell its suite of health and genomic services.
Financial Results
December 31, 2024 compared with December 31, 2023
Net revenue for the year ended December 31, 2024, decreased
Cost of revenues for the year ended December 31, 2024 was
We realized a gross loss of
Diagnostic expenses for the year ended December 31, 2024 were zero as compared to
General and administration expenses increased
Research and development costs for the year ended December 31, 2024 and 2023 were
As a result of the effects described above, net loss for the year ended December 31, 2024 was
Our aggregate cash and cash equivalents as of December 31, 2024 were
Webcast Details
Investors interested in participating in this live event will need to register using the link below. After the event, a replay will be available on the Company’s investor website.
REGISTER HERE:
https://www.renmarkfinancial.com/events/fourth-quarter-year-end-2024-results-virtual-conference-call-nasdaq-prph-PA3S8FxovQ
- To ensure smooth connectivity, please access this link using the latest version of Google Chrome.
About ProPhase Labs
ProPhase Labs Inc. (Nasdaq: PRPH) (“ProPhase”) is a next-generation biotech, genomics and consumer products company. Our goal is to create a healthier world with bold action and the power of insight. We’re revolutionizing healthcare with industry-leading Whole Genome Sequencing solutions, while developing potential game changer diagnostics and therapeutics in the fight against cancer. This includes a potentially life-saving cancer test focused on early detection of esophageal cancer and potential breakthrough cancer therapeutics with novel mechanisms of action. We develop, manufacture, and commercialize health and wellness solutions to enable people to live their best lives. We are committed to executional excellence, smart diversification, and a synergistic, omni-channel approach. ProPhase Labs’ valuable subsidiaries, their synergies, and significant growth underscore our potential for long-term value.
Forward-Looking Statements
Except for the historical information contained herein, this document contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our strategy, plans, objectives and initiatives, including our expectations regarding the future revenue growth potential of each of our subsidiaries, our expected timeline for commercializing our BE-Smart Esophageal Cancer Test, our expectations regarding future liquidity events, the success of our efforts to collect accounts receivables and anticipated timeline for any payments relating thereto, and our ability to successfully transition into a consumer products company. Management believes that these forward-looking statements are reasonable as and when made. However, such forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially from those projected in the forward-looking statements. These risks and uncertainties include but are not limited to our ability to obtain and maintain necessary regulatory approvals, general economic conditions, consumer demand for our products and services, challenges relating to entering into and growing new business lines, the competitive environment, and the risk factors listed from time to time in our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and any other SEC filings. The Company undertakes no obligation to update forward-looking statements except as required by applicable securities laws. Readers are cautioned that forward-looking statements are not guarantees of future performance and are cautioned not to place undue reliance on any forward-looking statements.
Media Relations and Institutional Investor Contact:
ProPhase Labs, Inc.
investorrelations@prophaselabs.com
Retail Investor Relations Contact:
Renmark Financial Communications
John Boidman
212-812-7680
Jboidman@renmarkfinancial.com
PROPHASE LABS, INC AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)
| December 31, 2024 | December 31, 2023 | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 678 | $ | 1,609 | ||||
| Marketable securities, available for sale | — | 3,127 | ||||||
| Accounts receivable, net | 20,058 | 35,814 | ||||||
| Inventory, net | 1,143 | 2,291 | ||||||
| Prepaid expenses and other current assets | 2,615 | 1,955 | ||||||
| Current assets held-for-sale | 6,143 | 2,789 | ||||||
| Total current assets | 30,637 | 47,585 | ||||||
| Property, plant and equipment, net | 7,501 | 10,330 | ||||||
| Prepaid expenses, net of current portion | 217 | 832 | ||||||
| Operating lease right-of-use asset, net | 4,115 | 4,572 | ||||||
| Intangible assets, net | 9,750 | 12,333 | ||||||
| Goodwill | 5,231 | 5,231 | ||||||
| Deferred tax asset | — | 7,313 | ||||||
| Other assets | 310 | 1,163 | ||||||
| Non-current assets held-for-sale | 5,439 | 2,568 | ||||||
| TOTAL ASSETS | $ | 63,200 | $ | 91,927 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | 13,717 | $ | 8,644 | ||||
| Accrued diagnostic services | 31 | 314 | ||||||
| Accrued advertising and other allowances | 151 | 24 | ||||||
| Finance lease liabilities | 2,147 | 1,840 | ||||||
| Operating lease liabilities | 1,214 | 953 | ||||||
| Short-term loan payable, net of discount of | 3,207 | — | ||||||
| Deferred revenue | 1,698 | 2,382 | ||||||
| Income tax payable | 1,987 | 3,279 | ||||||
| Other current liabilities | 2,115 | 2,586 | ||||||
| Current liabilities held-for-sale | 5,867 | 835 | ||||||
| Total current liabilities | 32,134 | 20,857 | ||||||
PROPHASE LABS, INC AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)
Continued
| December 31, 2024 | December 31, 2023 | |||||||
| Non-current liabilities: | ||||||||
| Unsecured promissory notes, net of discount of | $ | 9,873 | $ | 7,334 | ||||
| Unsecured long-term debt, net of discount of | 1,779 | — | ||||||
| Due to sellers (see Note 3) | 2,000 | 2,000 | ||||||
| Deferred revenue, net of current portion | 784 | 1,100 | ||||||
| Finance lease liabilities, net of current portion | 2,591 | 4,092 | ||||||
| Operating lease liabilities, net of current portion | 3,762 | 4,237 | ||||||
| Non-current liabilities held-for-sale | 2,924 | 2,924 | ||||||
| Total non-current liabilities | 23,713 | 21,687 | ||||||
| Total liabilities | 55,847 | 42,544 | ||||||
| COMMITMENTS AND CONTINGENCIES | ||||||||
| Stockholders’ equity | ||||||||
| Preferred stock authorized 1,000,000, | — | — | ||||||
| Common stock authorized 50,000,000, | 23 | 18 | ||||||
| Additional paid-in capital | 129,921 | 118,694 | ||||||
| Accumulated deficit | (58,393 | ) | (5,029 | ) | ||||
| Treasury stock, at cost, 12,940,967 and 18,940,967 shares, respectively | (64,000 | ) | (64,000 | ) | ||||
| Accumulated other comprehensive loss | (198 | ) | (300 | ) | ||||
| Total stockholders’ equity | 7,353 | 49,383 | ||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 63,200 | $ | 91,927 | ||||
PROPHASE LABS, INC & SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
| For the years ended | ||||||||
| December 31, 2024 | December 31, 2023 | |||||||
| Cash flows from operating activities | ||||||||
| Net loss | $ | (53,364 | ) | $ | (16,782 | ) | ||
| Less: loss from discontinued operations, net of tax | (3,839 | ) | (402 | ) | ||||
| Net loss from continuing operations | (49,525 | ) | (16,380 | ) | ||||
| Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||
| Realized loss on marketable debt securities | 18 | (22 | ) | |||||
| Depreciation and amortization | 6,187 | 6,050 | ||||||
| Amortization of debt discount | 1,485 | 132 | ||||||
| Amortization on right-of-use assets | 457 | 421 | ||||||
| Gain from disposal of fixed assets | (91 | ) | (23 | ) | ||||
| Stock-based compensation expense | 3,638 | 3,536 | ||||||
| Accounts receivable allowances | — | 724 | ||||||
| Inventory valuation reserve | (212 | ) | — | |||||
| Credit loss expense, direct write-offs | 11,018 | 91 | ||||||
| Debt extinguishment loss | 333 | — | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | 4,738 | (617 | ) | |||||
| Inventory | 1,360 | 170 | ||||||
| Prepaid expenses and other current assets | (45 | ) | (216 | ) | ||||
| Deferred tax asset | 7,150 | (7,313 | ) | |||||
| Other assets | 853 | — | ||||||
| Accounts payable and accrued expenses | 5,066 | 2,862 | ||||||
| Accrued diagnostic services | (283 | ) | (695 | ) | ||||
| Accrued advertising and other allowances | 127 | (75 | ) | |||||
| Deferred revenue | (1,000 | ) | (76 | ) | ||||
| Deferred tax liability | — | (307 | ) | |||||
| Lease liabilities | (1,408 | ) | (181 | ) | ||||
| Income taxes payable | (1,292 | ) | (911 | ) | ||||
| Other liabilities | (377 | ) | 637 | |||||
| Net cash used in operating activities - continuing operations | (11,803 | ) | (12,193 | ) | ||||
| Net cash (used in) provided by operating activities - discontinued operations | (5,735 | ) | 305 | |||||
| Net cash used in operating activities | (17,538 | ) | (11,888 | ) | ||||
| Cash flows from investing activities | ||||||||
| Business acquisitions, escrow received | — | 478 | ||||||
| Business acquisitions, net of cash acquired | — | (2,904 | ) | |||||
| Purchase of marketable securities | — | (3,819 | ) | |||||
| Proceeds from sales of marketable securities | — | 3,817 | ||||||
| Proceeds from maturities of marketable securities | 3,374 | 4,168 | ||||||
| Proceeds from dispositions of property and other assets, net | 229 | 46 | ||||||
| For the years ended | ||||||||
| December 31, 2024 | December 31, 2023 | |||||||
| Capital expenditures | (906 | ) | (2,084 | ) | ||||
| Net cash provided by (used in) investing activities - continuing operations | 2,697 | (298 | ) | |||||
| Net cash used in investing activities - discontinued operations | (275 | ) | (1,071 | ) | ||||
| Net cash provided by (used in) investing activities | 2,422 | (1,369 | ) | |||||
| Cash flows from financing activities | ||||||||
| Proceeds from issuance of common stock from public offering, net | 7,594 | — | ||||||
| Proceeds from issuance of note payable | 9,862 | 7,600 | ||||||
| Proceeds from exercise of warrants | — | 1,200 | ||||||
| Repayment of common stock for payment of statutory taxes on cashless exercise of stock options | — | (5,379 | ) | |||||
| Repayment of note payable | (4,249 | ) | — | |||||
| Repurchases of common shares | — | (588 | ) | |||||
| Net cash provided by financing activities - continuing operations | 13,207 | 2,833 | ||||||
| Net cash (used in) provided by financing activities - discontinued operations | 978 | 2,924 | ||||||
| Net cash provided by financing activities | 14,185 | 5,757 | ||||||
| Decrease in cash, cash equivalents and restricted cash | (931 | ) | (7,500 | ) | ||||
| Cash and cash equivalents at the beginning of the year | 1,609 | 9,109 | ||||||
| Cash and cash equivalents at the end of the year | $ | 678 | $ | 1,609 | ||||
| Supplemental disclosures: | ||||||||
| Cash paid for income taxes | $ | 1,126 | $ | 3,000 | ||||
| Interest payment on the promissory notes | $ | 3,105 | $ | 932 | ||||
| Supplemental disclosure of non-cash investing and financing activities: | ||||||||
| Assets obtained in exchange for new finance lease obligations | $ | 3,783 | $ | 5,809 | ||||
| Issuance of treasury shares as collateral for a loan | $ | 3 | $ | — | ||||
| Stock-based compensation included in the prepaid expense | $ | — | $ | 1,024 | ||||
| Issuance of common shares for debt conversion | $ | — | $ | 2,400 | ||||
| Net unrealized loss, investments in marketable securities | $ | 265 | $ | 1,520 | ||||
| Issuance of warrants with unsecured promissory note | $ | — | $ | 398 | ||||
| Common stock issued in asset acquisition | $ | — | $ | 1,000 | ||||
Non-GAAP Financial Measure and Reconciliation
In an effort to provide investors with additional information regarding our results of operations as determined by accounting principles generally accepted in the United States of America (“GAAP”), we disclose certain non-GAAP financial measures. The primary non-GAAP financial measures we disclose are EBITDA and Adjusted EBITDA.
We define EBITDA as net income (loss) before net interest expense, income taxes, depreciation and amortization from continuing operations. Adjusted EBITDA further adjusts EBITDA by excluding acquisition costs, other non-cash items, and other unusual or non-recurring charges (as described in the table below).
Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. These non-GAAP financial measures do not reflect a comprehensive system of accounting, differ from GAAP measures with the same names and may differ from non-GAAP financial measures with the same or similar names that are used by other companies. We compute non-GAAP financial measures using the same consistent method from quarter to quarter and year to year. We may consider whether other significant items that arise in the future should be excluded from the non-GAAP financial measures.
We use EBITDA and Adjusted EBITDA internally to evaluate and manage the Company’s operations because we believe they provide useful supplemental information regarding the Company’s ongoing economic performance. We believe that these non-GAAP financial measures provide meaningful supplemental information regarding our operating results primarily because they exclude amounts that are not considered part of ongoing operating results when planning and forecasting and when assessing the performance of the organization. In addition, we believe that non-GAAP financial information is used by analysts and others in the investment community to analyze our historical results and in providing estimates of future performance and that failure to report these non-GAAP measures could result in confusion among analysts and others and create a misplaced perception that our results have underperformed or exceeded expectations.
The following table sets forth the reconciliations of EBITDA and Adjusted EBITDA from continuing operations excluding other costs to the most comparable GAAP financial measures (in thousands):
| For the years ended | ||||||||
| December 31, 2024 | December 31, 2023 | |||||||
| GAAP loss from continuing operations (1) | $ | (49,525 | ) | $ | (16,380 | ) | ||
| Interest, net | 3,350 | 1,188 | ||||||
| Income tax expense | 7,195 | (6,018 | ) | |||||
| Depreciation and amortization | 6,187 | 6,050 | ||||||
| EBITDA | (32,793 | ) | (15,160 | ) | ||||
| Share-based compensation expense | 3,638 | 3,536 | ||||||
| Non-cash rent expense (2) | 240 | 117 | ||||||
| Credit loss expense | 11,018 | 91 | ||||||
| Adjusted EBITDA from continuing operations | $ | (17,897 | ) | $ | (11,416 | ) | ||
(1) We believe that net loss from continuing operations is the financial measure calculated and presented in accordance with GAAP that is most directly comparable to EBITDA and Adjusted EBITDA. EBITDA and Adjusted EBITDA measure the Company’s operating performance without regard to certain expenses. EBITDA and Adjusted EBITDA are not presentations made in accordance with GAAP and the Company’s computation of EBITDA and Adjusted EBITDA may vary from others in the industry. EBITDA and Adjusted EBITDA have important limitations as analytical tools and should not be considered in isolation or as substitutes for analysis of the Company’s results as reported under GAAP.
(2) The non-cash portion of rent, which reflects the extent to which our GAAP rent expense recognized exceeds (or is less than) our cash rent payments. For newer leases, our rent expense recognized typically exceeds our cash rent payments, while for more mature leases, rent expense recognized is typically less than our cash rent payments.
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