GTXO(.009):$370,727 2nd Q net income. No PR yet.
GTXO typically issues PR up to a week after Financials. Since this is the first Q with impressive numbers, I thought they'd be quicker to PR, but no.
Here's the highlights. Totally below radar, IMO.
88,887,406 common shares issued and outstanding as of August 13, 2019.
Revenue $842,105
Gross Margin $777,896
Net Income $370,726
Revenues
Revenues as a whole in Q2 2019 increased by 472% or $694,857 in comparison to Q2 2018, primarily because of the increase in sales related to IP license fee income. Product revenues increased in Q2 2019 by 6% or $4,444 over Q2 2018 primarily due to the revenue we received from our military sales, service income increasing by 81% or $43,912 as recurring fees continue to increase and IP licensing revenues increased 5172% or $646,500. IP licensing income from Inventergy in Q2 2019 continued with 1 licensing and settlement agreement executed.
The Company’s goal is to generate recurring subscription revenues from the use of all of our tracking products.
We had a 44% increase in international subscribers, 38% domestic subscribers and a 42% increase in total subscribers for Q2 2019 compared to Q2 2018.
Cost of goods sold
Cost of goods sold increased by 53% or $22,146 during Q2 2019 in comparison to Q2 2018 primarily due to the sales of IP revenues with little or no costs associated with them. The total gross margin increased from 71.43% in Q2 of 2018 to 92.38% in Q2 of 2019 primarily from the high margin sales related to IP licensing revenue.
Wages and benefits
Wages and benefits during Q2 2019 decreased by 17% or $38,109 in comparison to Q2 2018, primarily on lower staffing expenses.
Professional fees
Professional fees consist of costs attributable to consultants and contractors who primarily spend their time on legal, accounting, product development, business development, corporate advisory services and investor relations. Such costs increased $77,695 or 127% during Q2 2019 as compared to Q2 2018, primarily due to issuance of non-cash stock-based compensation to advisors related to the Inpixon transaction of $67,723 and non-cash related retention bonuses of $60,729.
Sales and marketing expenses
Sales and marketing expenses decreased by 69% or $4,186 during Q2 2019 in comparison to Q2 2018. These costs are expected to ramp up as we begin to launch new products.
General and administrative
General and administrative costs during Q2 2019 decreased by $23,114 or 34% in comparison to Q2 2018 due to lower D&O insurance costs, R&D and travel and entertainment expenses.
Other expense, net
Other expense, net decreased 90% or $391,921 from Q2 2018 to Q2 2019 primarily as a result of not adding any new debt instruments that carry non-cash derivative liabilities or increasing the amortization of debt discounts related to debt financings. As of June 30, 2019, the Company had $227,423 in derivative liabilities. Other expense, net also includes interest expenses related to notes.
