LOS ANGELES — Ispire Technology Inc., an innovator in vaping technology
and precision dosing, reported results for the fiscal first quarter 2025, which ended on September 30, 2024, and anticipates filing its annual report on Form 10-Q with the U.S. Securities and Exchange Commission on November 12, 2024.
Fiscal First Quarter 2025 Financial Results
- Revenue was $39.3 million as compared to $42.9 million in the fiscal first quarter of 2024.
- Gross profit increased 13.2% to $7.7 million compared to $6.8 million in the fiscal first quarter of 2024.
- Gross margin increased to 19.5% as compared to 16.0% in the fiscal first quarter of 2024
- Total operating expenses increased 67.0% to $12.9 million as compared to $7.7 million in the fiscal first quarter of 2024.
- Net loss of ($5.6) million as compared to net loss of ($1.3) million in the fiscal first quarter of 2024.
Michael Wang, Co-Chief Executive Officer of Ispire, commented, “Our results from the fiscal first quarter of 2025 reflect our commitment to our growth strategy of becoming the leading innovative vaping technology and precision dosing solutions
company worldwide. While our financial results were slightly impacted due to the strategic shifts we have made in our US business to focus on high quality customers and to improve payment terms and gross profit, I am pleased with our team’s overall performance
given the challenging macroeconomic environment and look forward to the remainder of fiscal 2025 and the opportunities that lay ahead.”
Mr. Wang continued, “Additionally, we have continued to make progress with the point-of-use age-gating technology and have begun the initial phase of commercialization worldwide. Also, our recently launched ‘I-80’ is set to revolutionize
the cannabis industry given its production efficiency and cost effectiveness and we continue to see increased adoption of our machine from leading players in the industry. Lastly, we are excited to have recently expanded our global reach through a landmark
5-year master distributor agreement with ANDS for the Middle East and North Affrica region and Global Duty-Free markets. This partnership will enable us to bring our Hidden Hills Club nicotine portfolio to new markets, offering adult consumers innovative,
harm-reduced alternatives to combustible cigarettes. We believe that the recent advancements we have made, combined with our solid financial performance, positions Ispire for continued growth and success as we proceed with our mission of providing industry-leading
vaping technology worldwide.”
Jim McCormick, Chief Financial Officer of Ispire, stated, “The results from our fiscal first quarter were in line with our internal projections as we shifted our U.S. strategy while we also had a few delayed shipments which impacted our
quarterly results. Despite the obstacles we’ve faced, our first quarter financial performance was still strong, including our gross profit increasing 13.2% year-over-year and our gross margins improving from 16.0% in the fiscal first quarter of 2024 to 19.5%
in the fiscal first quarter of 2025. As we head into the remainder of fiscal 2025, we are confident that we are well-positioned to continue delivering value to our shareholders as we advance our mission of becoming a global leading provider of innovative vaping
technology and precision dosing solutions.”
Financial Results for the Fiscal First Quarter Ended September 30, 2024
For the fiscal first quarter ended September 30, 2024, Ispire reported revenue of $39.3 million compared to $42.9 million during the same period last year, a decrease of 8.2%. The decrease in revenue is the combined effect of decreases
in product sales in the United States of $8.1 million from $17.8 million for the fiscal first quarter ended September 30, 2023, to $9.7 million for the three months ended September 30, 2024, offset by increases in sales of vaping products in Europe of $2.1
million from $19.9 million for the three months ended September 30, 2023 to approximately $22.0 million for the fiscal first quarter ended September 30, 2024, and increases in sales to other regions of $3.7 million from $0.06 million for the three months ended
September 30, 2023 to approximately $3.8 million for the fiscal first quarter ended September 30, 2024, mainly contributed by increase in sales to South Africa of $2.9 million.
Gross profit for the fiscal first quarter ended September 30, 2024, was $7.7 million compared to $6.8 million for the fiscal first quarter 2024 ended September 30, 2023. Over this same period, our gross margin grew to 19.5%, from 16.0%.
The increase in gross profit and gross margin was primarily due to changes in product mix with an increase in higher margin products being sold during the fiscal first quarter ended September 30, 2024.
Total operating expenses for the fiscal first quarter ended September 30, 2024 were $12.9 million as compared to $7.7 million for fiscal first quarter ended September 30, 2023. The increase in operating expenses is due to an increase in
our marketing activities, marketing campaign and trade shows of $0.7 million, stock-based compensation expense related to selling personnel of $1.0 million for the three months ended September 30, 2024 and headcount and payroll expense for Aspire Science of
$0.1 million. The Company also had an increase in stock-based compensation expense of $1.0 million for the three months ended September 30, 2024, as compensation and incentive for management, employees and service providers, and an increase in bad debt expense
as an allowance for credit losses of $1.9 million from accounts resulted from management’s assessment on Company’s account receivables balances.
For the fiscal first quarter ended September 30, 2024, net loss was ($5.6) million or ($0.10) per share, compared to a net loss of ($1.3) million, or ($0.02) per share for fiscal first quarter ended September 30, 2023.
As of September 30, 2024, Ispire had $37.7 million in cash and cash equivalents and working capital of $16.6 million.
About Ispire Technology Inc.
Ispire is engaged in the research and development, design, commercialization, sales, marketing, and distribution of branded e-cigarettes and cannabis vaping products. The Company’s operating subsidiaries own or license more than 200 patents received or filed
globally. Ispire’s tobacco products are marketed under the Aspire brand name and are sold worldwide (except in the U.S., People’s Republic of China and Russia) primarily through its global distribution network. The Company’s cannabis products are marketed
under the Ispire brand name primarily on an original design manufacturer (ODM) basis to other cannabis vapor companies. Ispire sells its cannabis vaping hardware only in the U.S., and it recently commenced its marketing activities in Canada and Europe.
