Crown Electrokinetics (CRKN) Q2 2024 earnings summary

Executive summary

• Achieved record Q2 2024 revenue of $4.6 million, up from $37,000 in Q2 2023 and 582% over Q1 2024, driven by new fiber optics contracts and expanded divisions including lead pipe inspection and remediation.

• Eliminated all investment debt and preferred equity, significantly improving the balance sheet and regaining NASDAQ compliance.

• Attracted experienced leadership and added senior management across all divisions to drive growth and profitability.

• Launched Element 82 and PE Pipelines divisions to address large-scale lead pipe issues in the U.S., with projects commenced in multiple states.

• Substantial doubt remains about the ability to continue as a going concern due to ongoing losses and cash burn.

Financial highlights

• Q2 2024 revenue reached $4.6 million, a sixfold increase over Q1 2024; six-month revenue totaled $5.3 million, up from $0.1 million for the same period in 2023.

• Q2 cost of revenue was $4 million, with $2.7 million in subcontract labor and $2.6 million in equipment costs; six-month cost was $5.8 million.

• Q2 net loss was $5.0 million, improved from $14.5 million in Q2 2023; six-month net loss was $9.6 million, down from $16.8 million prior year.

• Cash at June 30, 2024, was $4.0 million, up $2.9 million from year-end; net cash used in operations for six months was $8.9 million.

• Accumulated deficit stood at $126.6 million as of June 30, 2024.

Outlook and guidance

• Q3 2024 revenue projected at $8 million, in line with previous guidance.

• Gen 1 Alpha Smart Window Insert expected to launch in limited quantities by year-end 2024.

• Management anticipates continued strong growth trajectory and significant year in 2025 for revenue and EBITDA.

• Remaining performance obligations of $6.0 million as of June 30, 2024, expected to be recognized within 12 months.

• Additional capital is required to fund ongoing operations.