TOMI Environmental Solutions (TOMZ) Q2 2024 earnings summary

Executive summary

• Achieved profitability in Q2 2024 with net income of $30,000, marking the first profitable quarter since 2020 and reflecting strong execution, demand recovery, and a turnaround from prior losses.

• Quarterly revenue reached $3,013,000, up 170% sequentially and 9% year-over-year, driven by mobile equipment and BIT Solution sales, as well as international expansion.

• Strategic partnerships, notably with EMAQ, and cost reduction initiatives—including executive compensation and consulting fee reductions—contributed to improved margins and operational efficiency.

• Expanded customer base and secured significant new contracts in life sciences and international markets, with new product launches and increased focus on recurring solution sales.

• International revenue grew 130% year-over-year, with new customers in Canada, Mexico, the Philippines, and UAE.

Financial highlights

• Q2 2024 net revenue was $3,013,000, a 9% increase year-over-year from $2,775,000, and up from $1,114,000 in Q1 2024.

• Gross profit margin rose to 61.5% (Q2 2024) from 61.3% year-over-year; gross profit for Q2 was $1,855,000.

• Operating profit reached $121,000, reversing a prior year loss of $89,000; adjusted EBITDA for Q2 was $343,000.

• Net profit was $30,000, compared to a net loss of $89,000 in Q2 2023.

• Cash and cash equivalents stood at $709,000; working capital at $6.8 million; shareholders' equity at $7.3 million as of June 30, 2024.

Outlook and guidance

• Management anticipates a strong second half of 2024 and continued momentum into 2025 and 2026, supported by a robust sales pipeline and backlog.

• Year-to-date sales, including recognized revenue and open bookings, reached $5.6 million.

• Focus remains on revenue growth, cost control, and business development, with ongoing digital marketing and lead generation prioritized over tradeshows.

• Management expects continued growth in CES system sales and recurring solution revenue, with expansion into new markets and increasing operating margins.

• Cost control measures and strategic investments are expected to support profitability and liquidity over the next 12 months.