• Revenue: $38.5 million for Q2 2024, an 18.1% decrease from $47.1 million in Q2 2023.

• Gross Profit: $14.5 million for Q2 2024, down from $17.8 million in Q2 2023.

• Gross Profit Margin: 37.7%, a decrease of 20 basis points from the prior year period.

• Operating Expenses: $13.3 million for Q2 2024, a 15.8% decrease from $15.8 million in Q2 2023.

• Net Loss: $1.5 million or $0.18 per share for Q2 2024, compared to a net loss of $800,000 or $0.12 per share in Q2 2023.

• Adjusted EBITDA: $3.7 million for Q2 2024, down from $5.4 million in Q2 2023.

• Cash: $7.5 million as of June 30, 2024.

• Working Capital: $46.7 million as of June 30, 2024.

• Inventory: $37.8 million as of June 30, 2024.

• Total Assets: $138.8 million as of June 30, 2024.

• Debt: $40.3 million net of debt issuance cost of $1.9 million as of June 30, 2024.

• Stockholders' Equity: $7.5 million as of June 30, 2024.

• Common Shares Outstanding: 9.8 million as of June 30, 2024.

• Preferred Shares Outstanding: 3.1 million as of June 30, 2024.

• Warning! GuruFocus has detected 7 Warning Signs with BOXL.

Release Date: August 07, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Boxlight Corp (NASDAQ:BOXL) has successfully streamlined its operations, meeting profitability targets despite revenue headwinds.

• The company has introduced innovative products like UNITY and TimeSign, which align with industry demand catalysts such as school safety and STEM education.

• Boxlight Corp (NASDAQ:BOXL) has reduced operating expenses by 15.8% quarter-over-quarter, marking the lowest quarterly operating expense total since Q3 2021.

• The company has maintained strong gross margins, aided by a positive mix shift with increasing audio sales.

• Boxlight Corp (NASDAQ:BOXL) is well-positioned to capture market share with its comprehensive and integrated suite of edtech solutions.

Negative Points

• Boxlight Corp (NASDAQ:BOXL) experienced an 18.1% decrease in revenues for Q2 2024 compared to the same period in 2023.

• The company reported a net loss of $1.5 million for the quarter, an increase from the net loss of $800,000 in the prior year quarter.

• Market conditions remain challenging, with demand in key markets like the US and UK recovering slower than anticipated.

• The industry downturn has persisted longer than expected, affecting Boxlight Corp (NASDAQ:BOXL)'s revenue projections for the upcoming quarters.

• Boxlight Corp (NASDAQ:BOXL) faces competitive pricing pressures, which could impact future gross margins.

Q & A Highlights

Q: Last quarter, you mentioned improving market conditions for the second half. However, you now suggest that Q3 might not see such growth. What has changed in the last three months? A: Dale Strang, CEO: The US market for interactive flat panel displays has remained soft longer than anticipated, though some markets are recovering. The UK, for example, is showing signs of improvement following political clarity. Overall, market recovery is slower than expected, with varying conditions across different regions.

Q: The gross margin was strong this quarter. Was this due to product mix or pricing? What are your expectations for long-term sustainable gross margins? A: Gregory Wiggins, CFO: The strong margin was due to a positive mix shift, particularly increased audio sales, which carry higher margins. While we expect some competitive pricing pressure, margins have held up better than anticipated. We foresee margins in the 34% to 35% range in the near term, with potential long-term pressures.

Q: Are there any updates on improving the balance sheet? A: Dale Strang, CEO: While it's a priority, there are no immediate changes pending. We are working closely with our partners to ensure any actions taken are well-considered and not rushed.

Q: Can you provide some insight into customer discussions across your markets? A: Dale Strang, CEO: Conversations vary; partners focused on value-added solutions are optimistic and some are having record years. In contrast, those focused on volume without added value are more concerned about market conditions. Overall, there's a mix of optimism and caution.

Q: With new product launches like UNITY, are these contributing to sales yet? A: Dale Strang, CEO: These products were just announced and are starting to receive orders. While it's too early to include them in forecasts, we expect positive contributions to US results this year.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

This article first appeared on GuruFocus.