Significant Number of Warrants Are Off the Books Among Other Improvements
Detroit, Michigan, Oct. 24, 2022 (GLOBE NEWSWIRE) — Artificial Intelligence Technology Solutions, Inc., (OTCPK:AITX) (the “Company”), a global leader in AI-driven security and productivity solutions for enterprise clients, filed its quarterly report on Form 10-Q for the 3 and 6 months ended August 31, 2022 with the Securities and Exchange Commission for its Q2 of fiscal year 2023. AITX is a fully reporting company with the SEC, filing annual and quarterly reports with audited and unaudited financial statements, respectively.
“The second quarter was an important quarter, delivering continued revenue growth, stability, and maturity,” said Steve Reinharz, CEO of AITX. “Not only did subscription revenue increase year over year, but the Company solidified across all platforms and departments.”
Key Takeaways from the Q2 FY 2023 10-Q Filing
Subscription Revenue Increases 85% Over Prior Year
Total subscription revenue of $228,145 for the three months year ended August 31, 2022 increased over the prior year’s quarter ended August 31, 2022 by $123,375 or 85%. The majority of the Company’s revenue is derived from subscription-based contracts.
Increase in Gross Profit Percentage
Gross profit percentage stabilized at 87% margin in Q2 after stabilizing from the inventory adjustments in Q1 and resulted in an unusually low 23% gross profit percentage.
Proceeds on Common Share Issuances
The Company through October 21, 2022, received approximated $4M in share proceeds net of issuance costs. The Company expects to raise an additional $4M to $6M through the issuance of additional shares over the fiscal year, which it plans to use for its growth and debt reduction.
Reduction in Warrants
The Company eliminated 955 million warrants to purchase common stock at an average price of $0.008, in exchange for $3M in debt maturing in 2 years at an interest rate of 15%. The execution of such warrants would have diluted the value of the Company’s stock, so reducing the number of outstanding warrants and thereby increasing the value of the common stock to both current and future shareholders.
AITX and its subsidiaries announced and/or launched several new solutions during the second quarter of the fiscal year. These solutions leverage the RAD platform to provide unique ‘security-in-a-box’ solutions that can be deployed in minutes and provide innovative solutions such as firearm detection and much more. Added to RAD’s award-winning line up during the quarter were RIO, ROSA-P, TOM, ROSS, plus enhancements to RAD’s software suite.
Continued Expansion of Sales Funnel and Opportunities
RAD’s sales funnel continued to substantially grow through its established dealer channel and direct end-users opportunities. The RAD dealer network expanded to 46, adding six new dealers in the fiscal quarter. Sales opportunities were added through RAD’s participation at several nationwide and regional industry conferences, multiple dealer meetings, end-user meetings and demonstrations at the REX facility. On July 18, 2022, RAD hosted a livestreamed demonstration and press event showcasing RAD’s firearm detection technology.
“One of the breakthrough moments of the quarter was the announcement of our AI-based firearm detection,” Reinharz added. “We have received tremendous response and media attention to this innovative technology and its related ‘Bailey’s Gift’ campaign. It’s apparent that the marketplace is eager for an affordable and easy to deploy tech solution that can help save lives. We are very proud of this development and expect great results as it rolls out.”
AITX through its subsidiary, Robotic Assistance Devices, Inc. (RAD), is redefining the $25 billion (US) security and guarding services industry through its broad lineup of innovative, AI-driven Solutions-as-a-Service business model. RAD solutions are specifically designed to provide a cost savings to businesses of between 35%-80% when compared to the industry’s existing and costly manned security guarding and monitoring model. RAD delivers this tremendous costs savings via a suite of stationary and mobile robotic solutions that complement, and at times, directly replace the need for human personnel in environments better suited for machines. All RAD technologies, AI-based analytics and software platforms are developed in-house.
RAD has a sales pipeline of over 35 Fortune 500 companies and numerous other client opportunities. RAD expects to continue to attract new business as it converts its existing sales opportunities into deployed clients generating a recurring revenue stream. Each Fortune 500 client has the potential of making numerous reorders over time.
RAD’s parent company AITX has filed for up listing to the OTCQB. Future announcements will be made regarding the status of the OTCQB application.
CAUTIONARY DISCLOSURE ABOUT FORWARD-LOOKING STATEMENTS
This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Statements in this news release other than statements of historical fact are “forward-looking statements” that are based on current expectations and assumptions. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied by the statements, including, but not limited to, the following: the ability of Artificial Intelligence Technology Solutions to provide for its obligations, to provide working capital needs from operating revenues, to obtain additional financing needed for any future acquisitions, to meet competitive challenges and technological changes, to meet business and financial goals including projections and forecasts, and other risks. No information contained in this news release should be construed as any indication whatsoever of the Company’s future stock price, revenues, or results of operations. Additionally, industry data provided herein is of no predictive value regarding the future sale of the Company’s products. Artificial Intelligence Technology Solutions undertakes no duty to update any forward-looking statement(s) and/or to confirm the statement(s) to actual results or changes in Artificial Intelligence Technology Solutions expectations.
About Artificial Intelligence Technology Solutions (AITX)
AITX is an innovator in the delivery of artificial intelligence-based solutions that empower organizations to gain new insight, solve complex challenges and fuel new business ideas. Through its next-generation robotic product offerings, AITX’s RAD, RAD-M and RAD-G companies help organizations streamline operations, increase ROI, and strengthen business. AITX technology improves the simplicity and economics of patrolling and guard services and allows experienced personnel to focus on more strategic tasks. Customers augment the capabilities of existing staffs and gain higher levels of situational awareness, all at drastically reduced cost. AITX solutions are well suited for use in multiple industries such as enterprises, government, transportation, critical infrastructure, education, and healthcare. To learn more, visit www.aitx.ai, stevereinharz.com, www.radsecurity.com, radgroup.ai, and www.radlightmyway.com, or follow Steve Reinharz on Twitter @SteveReinharz.