Release Date: November 15, 2024

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

Positive Points

• Siyata Mobile Inc (NASDAQ:SYTA) reported a record revenue of $5.9 million for Q3 2024, marking a 218% increase compared to Q3 2023.
• Revenue from the US market was particularly strong, accounting for $4.8 million or 81% of total revenue.
• The company is experiencing increased demand for its SD7 handset and accessories, contributing to the revenue growth.
• Siyata Mobile Inc (NASDAQ:SYTA) is optimistic about its 5G product portfolio planned for 2025, which is expected to enhance its position as a leading PTT handset provider globally.
• Gross margin dollars increased significantly from $500,000 in Q3 2023 to $1.7 million in Q3 2024, indicating improved profitability potential.

Negative Points

• SG&A expenses rose to $4.7 million in Q3 2024 from $2.7 million in Q3 2023, primarily due to increased marketing expenses.
• Adjusted EBITDA was negative $3.3 million in Q3 2024, worsening from negative $1.6 million in Q3 2023.
• Working capital decreased to $200,000 as of September 30, 2024, from $1.3 million at the end of 2023.
• Despite revenue growth, the gross margin percentage slightly decreased from 28.2% in 2023 to 27.3% in 2024.
• The company continues to face challenges in achieving profitability, with ongoing negative EBITDA and increased expenses.

Q & A Highlights

• Warning! GuruFocus has detected 4 Warning Signs with SYTA.

Q: Can you provide more details on the revenue growth and what drove the increase in Q3 2024? A: Mark Seelenfreund, CEO: The revenue for Q3 2024 was $5.9 million, marking a 218% increase compared to Q3 2023. This growth was primarily driven by the increased demand for our SD7 handset and accessories, as well as having the necessary inventory to meet this demand. The U.S. market contributed $4.8 million, or 81% of total revenue, compared to $1.3 million, or 69% of total revenue, in Q3 2023.

Q: What are the expectations for the 5G product portfolio launch in 2025? A: Mark Seelenfreund, CEO: We are excited about our 5G product portfolio planned for launch in 2025, which we believe will position us as a leading PTT handset provider globally. T-Mobile is the first wireless carrier to launch part of this portfolio, and we anticipate more carriers will follow. Details of these innovative devices will be released in the coming months.

Q: How did the gross margin and SG&A expenses change in Q3 2024 compared to Q3 2023? A: Mark Seelenfreund, CEO: The gross margin percentage for Q3 2024 was 29%, up from 26.6% in Q3 2023, with gross margin dollars increasing from $500,000 to $1.7 million. SG&A expenses rose to $4.7 million from $2.7 million, primarily due to marketing expenses related to investor awareness.

Q: What is the current status of working capital and how has it changed? A: Mark Seelenfreund, CEO: As of September 30, 2024, working capital was $200,000, down from $1.3 million as of December 31, 2023. Excluding non-cash warrant and preferred share liabilities, working capital would have been $1.3 million at the end of Q3 2024 and $1.4 million at the end of 2023.

Q: What are the company's goals for revenue growth and profitability? A: Mark Seelenfreund, CEO: We are committed to achieving strong revenue growth and aim for profitability in the coming quarters. The rapid adoption of our disruptive solutions, particularly the push-to-talk over cellular technology, is expected to drive meaningful growth for our innovative products.

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