NEWARK, CA / ACCESSWIRE / December 12, 2024 / Altigen Technologies (OTCQB:ATGN), a leading Silicon Valley-based Microsoft Cloud Communications Solutions provider, announced today its financial results for the fourth quarter and year ended September 30, 2024.
"This quarter demonstrates the effectiveness of Altigen's transformation initiatives," said Jeremiah Fleming, Altigen President & CEO. "We've streamlined operations, achieved consistent performance improvements, and are making tangible progress in bringing our AI solutions to market, paving the way for sustainable growth."
Full Year Highlights (Fiscal 2024 versus Fiscal 2023)
Net revenue was $13.6 million, compared with $13.7 million;
Services revenue was $5.1 million, compared with $4.3 million;
Cloud services revenue was $7.1 million, compared with $7.6 million;
Gross margin decreased to 61.6%, compared with 63.2% in the previous year;
GAAP net income totaled $1.6 million, with diluted EPS of $0.06, primarily due to a $1.8 million non-cash tax-related benefit resulting from the release of the valuation allowance for deferred tax assets;
Non-GAAP1 net income and non-GAAP diluted EPS of $0.5 million and $0.02, respectively.
Fourth Quarter Highlights (Fiscal 2024 versus Fiscal 2023)
Net Revenue was $3.7 million, compared with $3.5 million;
Services revenue was $1.7 million, compared with $1.1 million;
Cloud services revenue was $1.7 million, compared with $2.0 million;
Gross margin increased to 63.9%, compared with 62.4% in the prior year;
GAAP net income was $2.1 million, with diluted EPS of $0.08, driven primarily by the previously mentioned non-cash, tax-related benefit of $1.8 million;
Non-GAAP1 net income and non-GAAP diluted EPS of $0.5 million and $0.02, respectively.
Select Financial Metrics: Fiscal 2024 versus Fiscal 2023
(in thousands, except for EPS and percentages)
Fiscal 4Q24
Fiscal 4Q23
Change
YTD FY2024
YTD FY2023
Change
Total Revenue
$
3,736
$
3,482
7.3
%
$
13,619
$
13,681
-0.5
%
Cloud Services
1,680
1,983
-15.3
%
7,097
7,656
-7.3
%
Services and Other
1,731
1,100
57.4
%
5,159
4,301
19.9
%
Legacy Products
325
399
-18.5
%
1,363
1,724
-20.9
%
Software Assurance
315
353
-10.8
%
1,293
1,551
-16.6
%
Perpetual Software License
10
46
-78.3
%
70
173
-59.5
%
GAAP Operating Income/(Loss)
$
209
$
30
596.7
%
$
(305
)
$
(436
)
nm
Operating Margin
5.6
%
0.9
%
-2.2
%
-3.2
%
Non-GAAP Operating Income/(Loss)
$
228
$
58
293.1
%
$
(245
)
$
(317
)
nm
Non-GAAP Operating Margin
6.1
%
1.7
%
-1.8
%
-2.3
%
GAAP Net Income/(Loss)
$
2,079
$
(2,813
)
nm
$
1,560
$
(3,323
)
nm
GAAP Income/(Loss) Per Share
$
0.08
$
(0.11
)
nm
$
0.06
$
(0.14
)
nm
Non-GAAP Net Income
$
493
$
145
240.0
%
$
467
$
324
44.1
%
Non-GAAP Diluted Earnings Per Share
$
0.02
$
0.01
nm
$
0.02
$
0.01
nm
Adjusted EBITDA(1)
$
507
$
109
365.1
%
$
495
$
252
96.4
%
Cash Flow from Operations
$
641
$
(236
)
nm
$
510
$
62
nm
nm = not measurable/meaningful; *may not add up due to rounding
Throughout this release, the use of non-GAAP financial measures is intended to provide useful information that supplements Altigen's results in accordance with GAAP. Please refer to the Reconciliation of Non-GAAP Financial Measure at the end of this release.
Trended Financial Information
(in thousands, except for EPS and percentages)
Fiscal 1Q23
Fiscal 2Q23
Fiscal 3Q23
Fiscal 4Q23
Fiscal 1Q24
Fiscal 2Q24
Fiscal 3Q24
Fiscal 4Q24
FY2023
FY2024
Total Revenue
$
3,460
$
3,373
$
3,366
$
3,482
$
3,240
$
3,360
$
3,283
$
3,736
$
13,681
$
13,619
Cloud Services
1,822
1,894
1,957
1,983
1,890
1,817
1,710
1,680
7,656
7,097
Services and Other
1,174
1,028
999
1,100
996
1,183
1,249
1,731
4,301
5,159
Legacy Products
464
451
410
399
354
360
324
325
1,724
1,363
Software Assurance
424
390
384
353
342
340
296
315
1,551
1,293
Perpetual Software License
40
61
26
46
12
20
28
10
173
70
GAAP Operating Income/(Loss)
$
(188
)
$
(131
)
$
(147
)
$
30
$
(342
)
$
(240
)
$
68
$
209
$
(436
)
$
(305
)
Operating Margin
-5.4
%
-3.9
%
-4.4
%
0.9
%
-10.6
%
-7.1
%
2.1
%
5.6
%
-3.2
%
-2.2
%
Non-GAAP Operating Income/(Loss)
$
(156
)
$
(101
)
$
(118
)
$
58
$
(330
)
$
(225
)
$
82
$
228
$
(317
)
$
(245
)
Non-GAAP Operating Margin
-4.5
%
-3.0
%
-3.5
%
1.7
%
-10.2
%
-6.7
%
2.5
%
6.1
%
-2.3
%
-1.8
%
GAAP Net Income/(Loss)
$
(188
)
$
(140
)
$
(183
)
$
(2,813
)
$
(345
)
$
(236
)
$
62
$
2,079
$
(3,324
)
$
1,560
Non-GAAP Net Income/(Loss)
$
44
$
95
$
40
$
145
$
(156
)
$
(72
)
$
202
$
493
$
324
$
467
Non-GAAP Diluted Earnings/ Loss Per Share
$
0.00
$
0.00
$
0.00
$
0.01
$
(0.01
)
$
(0.00
)
$
0.01
$
0.02
$
0.01
$
0.02
Adjusted EBITDA(1)
$
44
$
95
$
4
$
109
$
(159
)
$
(67
)
$
214
$
507
$
252
$
495
Throughout this release, the use of non-GAAP financial measures is intended to provide useful information that supplements Altigen's results in accordance with GAAP. Please refer to the Reconciliation of Non-GAAP Financial Measure at the end of this release.
Conference Call
Altigen will be discussing its financial results and outlook on a conference call today at 2:00 p.m. Pacific Time (5:00 p.m. ET). The conference call can be accessed by dialing (888) 506-0062 (domestic) or (973) 528-0011 (international), conference ID #182309. A live webcast will also be made available at www.altigen.com. To access the replay, dial (877) 481-4010 (domestic) or (919) 882-2331 (international), conference ID #51729. A web archive will be made available at www.altigen.com for 90 days following the call's conclusion.
About Altigen Technologies
Altigen Technologies (OTCQB: ATGN) is focused on driving digital transformation in today's modern workplace. Our Cloud Communications solutions and Technology Consulting services empower companies of all sizes to elevate customer engagement, increase employee productivity and improve operational efficiency. We're headquartered in Silicon Valley with operations strategically located in five countries spanning three continents. For more information, call 1-888-ALTIGEN or visit our website at www.altigen.com.
Safe Harbor Statement
This press release contains forward‐looking information. The statements are based on reasonable assumptions, beliefs and expectations of management and the Company provides no assurance that actual events will meet management's expectations. Furthermore, the forward-looking statements contained in this press release are based on the Company's views of future events and financial performances which are subject to known and unknown risks and uncertainties including, but not limited to, statements regarding the Company's operational improvements, performance enhancements, AI solution development, and expectations for sustainable growth. There can be no assurances that the Company will achieve the expected results, and actual results may be materially different than expectations and from those stated or implied in forward-looking statements.
Please refer to the Company's most recent Annual Report filed with the OTCQB over-the-counter market for a further discussion of risks and uncertainties. Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. The Company does not undertake any obligation to update any forward-looking statements.
Contact: Carolyn David Vice President of Finance Altigen Communications, Inc. (408) 597-9033 www.altigen.com
ALTIGEN COMMUNICATIONS, INC. CONSOLIDATED BALANCE SHEETS (In thousands)
September 30,
2024
September 30,
2023
ASSETS
Current assets:
Cash and cash equivalents
$
2,575
$
2,641
Accounts receivable, net
1,770
1,495
Other current assets
185
236
Total current assets
4,530
4,372
Property and equipment, net
-
3
Operating lease right-of-use assets
149
301
Goodwill
2,725
2,725
Intangible assets, net
1,242
1,568
Capitalized software development cost, net
1,363
1,215
Deferred tax asset
5,638
3,737
Other long-term assets
2
-
Total assets
$
15,649
$
13,921
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable
$
98
$
58
Accrued compensation and benefits
593
417
Accrued expenses
446
455
Deferred consideration - current
744
510
Operating lease liabilities - current
104
324
Deferred revenue - current
481
477
Total current liabilities
2,466
2,241
Deferred consideration - long-term
-
208
Operating lease liabilities - long-term
49
-
Deferred revenue - long-term
176
134
Total liabilities
2,691
2,583
Stockholders' equity:
Common stock
24
24
Treasury stock
(1,565
)
(1,565
)
Additional paid-in capital
73,193
73,133
Accumulated deficit
(58,694
)
(60,254
)
Total stockholders' equity
12,958
11,338
Total liabilities and stockholders' equity
$
15,649
$
13,921
ALTIGEN COMMUNICATIONS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
Twelve Months Ended
September 30,
2024
2023
Cash flows from operating activities:
Net income (loss)
$
1,560
$
(3,324
)
Adjustments to reconcile net income to net cash from operating activities:
Impairment of capitalized software
53
-
Impairment of intangible assets
142
131
Depreciation and amortization
3
4
Deferred income tax expense
(1,901
)
2,756
Change in operating lease liabilities
(19
)
-
Amortization of intangible assets
184
183
Amortization of capitalized software
375
587
Stock-based compensation
60
119
Changes in operating assets and liabilities:
Accounts receivable and unbilled accounts receivable
(275
)
(275
)
Prepaid expenses and other current assets
51
(30
)
Other long-term assets
(2
)
37
Accounts payable
40
5
Accrued expenses
193
30
Deferred revenue
46
(161
)
Net cash provided by operating activities
510
62
Cash flows from investing activities:
Capitalized software development costs
(576
)
(471
)
Net cash used in investing activities
(576
)
(471
)
Cash flows from financing activities:
Payment related to business acquisition
-
(225
)
Proceeds from issuances of common stock
-
43
Net cash used in financing activities
-
(182
)
Net decrease in cash and cash equivalents
(66
)
(591
)
Cash and cash equivalents, beginning of year
2,641
3,232
Cash and cash equivalents, end of year
$
2,575
$
2,641
ALTIGEN COMMUNICATIONS, INC. CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (In thousands, except per share data)
Three Months Ended
Twelve Months Ended
September 30,
September 30,
2024
2023
2024
2023
Net revenue
$
3,736
$
3,482
$
13,619
$
13,681
Gross profit
2,386
2,172
8,395
8,648
Operating expenses:
Research and development
885
1,187
4,268
5,066
Selling, general & administrative
1,292
955
4,432
4,018
Operating income (loss)
209
30
(305
)
(436
)
Interest expense
(3
)
(37
)
(26
)
(74
)
Interest and other income
16
1
52
2
Net income (loss) before provision for income taxes
222
(6
)
(279
)
(508
)
Income tax benefit (expense) (1)
1,857
(2,807
)
1,839
(2,816
)
Net income (loss)
$
2,079
$
(2,813
)
$
1,560
$
(3,324
)
Per share data:
Basic
$
0.08
$
(0.11
)
$
0.06
$
(0.14
)
Diluted
$
0.08
$
(0.11
)
$
0.06
$
(0.14
)
Weighted average shares outstanding:
Basic
24,919
24,917
24,919
24,550
Diluted
25,903
24,917
25,959
24,550
(1) The Company's fourth quarter fiscal year 2024 results include a non-cash tax benefit of $1.8 million, resulting from the release of the valuation allowance for deferred tax assets, while the Company's fourth quarter fiscal year 2023 results include a non-cash tax expense of approximately $2.7 million, primarily due to differences between the Company's income tax rate and the statutory rate.
ALTIGEN COMMUNICATIONS, INC. RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (In thousands, except per share data)
Three Months Ended
Twelve Months Ended
September 30,
September 30,
2024
2023
2024
2023
Reconciliation of GAAP to Non-GAAP Gross Profit:
GAAP gross profit
$
2,386
$
2,172
$
8,395
$
8,648
Amortization of capitalized software
56
124
335
531
Amortization of acquired customer relationships
40
40
160
160
Non-GAAP gross profit
$
2,482
$
2,336
$
8,890
$
9,339
Reconciliation of GAAP to Non-GAAP Expenses:
GAAP operating expenses
$
2,177
$
2,142
$
8,700
$
9,084
Asset impairment
142
-
142
-
Depreciation and amortization
-
1
3
4
Amortization of capitalized software
9
13
40
56
Amortization of intangible assets
6
6
24
24
Stock-based compensation
18
29
60
119
Non-GAAP operating expenses
$
2,002
$
2,093
$
8,431
$
8,881
Reconciliation of GAAP to Non-GAAP Net Income:
GAAP net loss
$
2,079
$
(2,813)
$
1,560
$
(3,324)
Asset impairment
142
-
142
-
Depreciation and amortization
-
1
3
4
Amortization of capitalized software
65
137
375
587
Amortization of intangible assets
46
46
184
184
Stock-based compensation
18
29
60
119
Deferred tax asset valuation allowance
(1,857)
2,745
(1,857)
2,754
Non-GAAP net income
$
493
$
145
$
467
$
324
Per share data:
Basic
$
0.02
$
0.01
$
0.02
$
0.01
Diluted
$
0.02
$
0.01
$
0.02
$
0.01
Weighted average shares outstanding:
Basic
24,919
24,917
24,919
24,550
Diluted
25,903
26,122
25,959
25,663
Non-GAAP Financial Measures
In calculating non-GAAP financial measures, we exclude certain items to facilitate a review of the comparability of our core operating performance on a period-to-period basis. These non-GAAP financial measures exclude stock-based compensation expense, amortization of acquired intangible assets, depreciation and amortization expenses, acquisition-related costs, change in deferred tax asset valuation allowance, litigation costs and other non-recurring or unusual charges or benefits that may arise from time to time that we do not consider to be directly related to core operating performance. We use non-GAAP measures to evaluate the core operating performance of our business and to perform financial planning. Since we find these measures to be useful, we believe that investors benefit from seeing results reviewed by management in addition to seeing GAAP results. We believe that these non-GAAP measures, when read in conjunction with our GAAP financials, provide useful information to investors by facilitating: (i) the comparability of our on-going operating results over the periods presented and (ii) the ability to identify trends in our underlying business.
