SKYX Platforms Corp. Price & Performance (SKYX)

We expect significant project and order growth resulting in becoming cash flow positive in the second half of twenty twenty five. We also achieved revenue growth in four consecutive quarters for 2024, from Q1 of 19,000,000 to over $23,700,000 in Q4. For record sales. Our safety code standardization team which is led by Mark Early, former head of the National Electric Code, chief engineer of the NFPA, still a member of the International Electric Code, together with Eric Jacobsen, former president and CEO of the American Lighting Association. We anticipate major support from additional safety and leading members for our safety mandatory standardization of our electrical ceiling outlet receptacle to technology. We have recently received some indications that based on the significant safety aspects of our technology, we are being positively reviewed by leading personnel including leading safety experts that are assisting us with our mandatory safety standardization process as they strongly believe our technology has met all the criteria to become mandatory. A few, as we kind of look at it, we generated a record $23,700,000 in revenue in Q3 'twenty four compared to $22,200,000 in Q4 'twenty three. We reported $15,500,000 in cash, cash equivalents and restricted cash as of December 24, compared to $13,000,000 as of September thirty of 'twenty four.

In March '5, we secured additional $1,450,000 of funding including from a strategic investor through our $2 Series A-one preferred offering. As is common with companies such as ours, when sales are converted into cash rapidly, often referred to as the Dell working capital model, we continue to leverage our trades payable to finance our operations. To enhance our cash position and to lower our cost of capital. We reduced our G and A expenses by $5,700,000 to 31,400,000.0 and in 2024 from $37,000,000 as of 12/31/2023. We reported a $3,300,000 decrease in total liabilities and a reduction of $3,900,000 in net loss comparing 2024 to 2023. And as I said before, we plan to become cash flow positive in the second half of twenty twenty five. As we previously announced, we secured $11,000,000 of equity preferred stock investment led by the Shaner Group, a leading Marriott hotel owner with over 70 hotels including significant insider investing by myself, at $500,000 co CEO, Len Sokolow and John Campi, at $250,000 had a preferred investment representing the $2 per share of common stock with no warrants. We expect to grow increasingly units and growth to pro builders and retail segment We continue to grow our market penetration of our advanced and smart plug and play products expecting our products to be in 20,000 U. S. And Canadian homes and units by the end of Q1 twenty twenty five.

We expect our products to be in tens of thousands of additional homes incrementally this year. A big plus is our technology provide opportunities for recurring revenue through interchangeability upgrades, monitoring and subscriptions. We continue to focus on our razor and blade model, and our product range includes our advanced sealing and electrical outlet the razor our advanced and smart home plug and play products, the Blade, including lighting, chandeliers, pendants, ceiling fans, recessed lights, downlights, exit signs, emergency lights, holiday kits, theme lights, indooroutdoor wall, lights among other smart products. We continue to utilize our e commerce platform platform with over 60 websites for lighting and home decor to educate and enhance our market penetration to both the retail and professional segments. From a partnership and collaboration standpoint, we have significant collaborations and partners with Home Depot and Wayfair. For our advanced and smart plug and play products. For both retail and professional segments. Our product offerings will include a variety of our advanced and smart plug and play products including retrofit kits, smart light fixtures, smart ceiling fans, ceiling outlet receptacles, recessed lights and more. We continue to collaborate with U. S. And world leading lighting companies, including Kichler, KwaZel, European leading company Eglo, and world leading manufacturer Rui.

We announced the collaboration with CABCO Homes, a leading U. S. Prefabricated home manufacturer on integrating our advanced and smart and plug plate technologies into Capco's high end premium homes shown at the Builders Show. GAPCO is a public company that has sold nearly 1,000,000 homes and continues to deliver close to 20,000 annually. Free luxury developments by 80 story high rise in Miami's Brickell District, and projects in Clearwater Beach in Jupiter, Florida will feature our technology. More than 12,000 smart plug and play products including ceiling outlets, lighting fans, and emergency fixtures will be supplied across 400 plus units. A 1,000 unit mixed use development by Jeremiah's Barron Companies will incorporate smart plug and play technologies with 140 units initial product supply. This product rollout will include ceiling outlets lighting fans and emergency fixtures, with deliveries continuing throughout construction. A strategic partnership with JI Electrical Supply, a leading builder supplier who'll expand SKYX's footprint in electrical lighting and ceiling fan markets JIT, which has supplied over 100,000 U. S. Homes, will distribute SKYX lighting solutions, ceiling fans, resets lights, emergency lights, exit signs and indooroutdoor wall light beginning early this year. On the people front, couple announcements. First, Huey Long, former Amazon e commerce director and executive at Walmart and Ashley Furniture, has joined as Head of our SKYX e platform.

He will collaborate with the existing team to expand market penetration across our 60 lighting and home decor websites and other key e commerce channels in The U. S. And Canada. Additionally, Greg St. John, former Head of office excuse me, Home Depot lighting, head and CEO of EGLU and Cordelia Lighting, has been appointed President of Lighting Fans and Smart Home Products. With thirty plus years of industry experience, he will lead expansion efforts in retail, homebuilder and commercial markets overseeing partnerships with Home Depot Wayfair and other major retailers. Hopefully, you can see that we have an awful lot going on that we feel very proud about. That will provide significant momentum as we go forward. I thank you. All right. At this point, I'd like to turn the call over to Len Socalo, our Co CEO, and talk more about our financials and where we're going. Len?

Thank you. Thank you very much, Joseph. Appreciate it. Just to recap a little bit. Besides the SKYX reporting, the 48% growth in revenues from $58,800,000 in 2023 to 86,300,000.0 in 2024 we generated a record $23,700,000 in revenue in Q4 compared to $22,200,000 in Q4 of twenty twenty three. Reported you know, as Steven mentioned, you know, we're we're reflecting the Dell working capital model. So our cash conversion is very rapid and we're leveraging our trade payables as we continue to grow our operations. We anticipate as Steve mentioned, number one, the significance of projects and orders And in addition, and in light of that, we we anticipate that we'll become cash flow positive during the second half of twenty twenty five. We reported a reduction in general and administrative expense by 5,700,000.0 to 31,400,000.0 as of 12/31/2024, from 37,000,000 at the December. We reported in addition, $3,300,000 decrease in total liabilities from 23 to '24 and a 10% reduction of approximately 3,900,000.0 in net loss. Our adjusted EBITDA loss per share is a non GAAP measure amount amounted to $0.13 per share. In 2024 as compared to $0.17 loss per share in 2023. The company also reported a 14% decrease in loss to $13,100,000 in 2024 from 15,200,000.0 in 2023 before interest, taxes, depreciation, amortization, as adjusted for share based payments or adjusted EBITDA which is a non GAAP measure.

And of significance is that our gross profit increased 36% year over year by approximately 6,500,000.0. So with that, in light of those highlights, Ronnie, anything further?

Thank you very much, Steve. And thank you very much, Lenny. Just would like to emphasize that as Steve mentioned, our leading code members, Mark Early, former head of the National Electrical Code, and Eric Jacobson, former president and CEO of the American Lighting Association are, receiving great support now to the code efforts There's several organizations that can help expedite that process and we're working together They're working together with those teams to expedite As Steve mentioned, we feel we met all this criteria, and there are several organizations that can help expediting that product. [indiscernible] And we also got some leading members that are helping us on a national level and, the co team are feel that they're very confident on their new path here. And that's something we're happy about. We're obviously encouraged by quarter to quarter growth and revenues and also very happy about the razor and the blade model As Steve mentioned, using this is really to start penetrating with more builders as you saw. We start announcing some collaborations with builders and as Steve and Lenny mentioned, we anticipate to have to announce additional projects, additional builders and some leading projects that we have here.

So overall, we feel that the razor and the blade model is really working for us. And as we said many times before, we're penetrating first and foremost [indiscernible] a new, I would say, way to enhance our sales by providing our ceiling outlets here. You can see on the left, we had a 24 pack. We have a 24 pack, eight pack and four pack and one pack of the ceiling outlet receptacle what we call our razor and we anticipate enhancing and growing our market penetration with those razors. And as Steve mentioned, we expect those razors to create or those ceiling outlets to create recurring revenues from different types of fixtures and things usability then also down the road with smart products with monitoring subscription, data aggregation, and AI and other features.

We also are very proud that our members here our leading members that are helping us with the code, in addition to our leading members in other areas We also have Paul Chernofsky, Entrepreneur of the Year, second from right here.

Former entrepreneur of the year by E and Y is an 60 websites, but also with Home Depot, with Wayfair, and with other places that we're working on. So we're very happy from the progress that we're and feedback receiving using, again, the razor and the blade model to penetrate and we're getting great reaction from from builders. And also from hotels. We're working on with Chainer Group that owns over 60 Marriotts and 20 other hotels. We're working on some of their renovations that once we have some products in the market, the entire assortment, we believe we can start working towards hopefully hotel renovations, and definitely grow our builder and our pro segments. That we have. In addition to this, we, as Steve mentioned, we [indiscernible] been blessed to join the company, UE Long, that is a ecommerce leading US leading member was one of directors for Amazon when they started was also head of e commerce and marketing for Walmart and also was Ashley Furniture grew their business substantially when it comes to e commerce and joining him he anticipates to deliver real strong numbers with our e commerce platform and we'll share more about this in the coming months.

But one of his main goals is also to enhance our B2B towards the Pro and the builders through our e commerce [indiscernible] high 90% is retail and really single digit small single digit is pro. And now bringing all this assortment he sees a great opportunity to grow the B2B with the plug and play products. We also have the former, lighting head of Home Depot join us. So to accommodate our growth with Home Depot, and we hope to to share more news on other companies and other growth opportunities, including the existing one with Home Depot and others, but also with hopefully new accounts. So in general, we're happy happy and we're working very hard. We're growing our business and we're optimistic. Our co team is very optimistic on some things that help and assistance we're getting here. With that being said, thank you everyone and we're probably going to open up to Q and A. Thank you. We will now begin the question and answer session. To ask a question, If you're using a speakerphone, If and you would like to withdraw your question, please press star then 2. And at this time, we'll pause momentarily to assemble our roster.

Okay. So maybe Pat, from Noble.

Hey, Ronnie. Thanks for taking my questions and congrats on the strong quarter and the strong year. First, I just wanted to ask about, I think it's almost a mandatory question probably is about the tariffs Could you just touch on your partnership with Rui and how you may be able to avoid some of the impacts how that might be might be able to mitigate some of those risks. Thank you.

Pat. And we are the last call, we also was asked the same questions and we didn't know those new tariffs will happen. But the good news is we even last call, we answered that we're already working with with factories in Vietnam, in Taiwan, and now in Cambodia, and even Rui, for since last year way before those tariffs came. Has opened other options, including Cambodia and Vietnam, that he can supply products from there. And I must say the first two years of the tariffs with COVID and everything else happened, I think a lot of people didn't take it serious. But I must say that in the past two years, the Chinese manufacturers are taking those tariffs very seriously as they saw tremendous business was lost in China, and didn't until it didn't hurt them, they didn't find choices. So the good news is they're already working for two years and those solutions and happens to be that that that really serves us well with with the new tariffs that no one expected, but really that should not affect us as we already have in place And I said in last earnings call, same. So we already had it there.

That time, we definitely are utilizing it for now. So it won't affect our business here. But thank you for the question.

Great. And if I could squeeze in one more, was just also wondering if you mentioned earlier about the mandatory approval process and that there are some organizations that could sort of help expedite that process. I was wondering if you could give any more insight into what sorts of organizations those would be if you had any examples in mind or any more color you could give there.

The standardization?

Yes.

Yeah. So what we're finding out, and I don't wanna mention names at that point, but what we're finding out working with very high level people that working with our code team that you know, between Mark Hurley and Eric Jacobson, as they actually created more or influence more standardizations in electrical and the lighting industry than than anyone else in the past thirty five years in The US. So getting for them or they feel very confident that there's several other paths of safety organizations that have a criteria to help in situations like this.

And as we are starting our process in the last several weeks, the team, the CO team are very optimistic on several options and organizations that are looking into it and and some people that understand that type of business really think that we, a, we met as Steve mentioned, all the criteria to become mandatory, and it's very obvious, you know, there hundreds of millions of times people go here in The US on on ceilings and touching hazardous wires, staying long time as on ladders. [indiscernible] create electrocutions, ladder fall fires, and many other hazardous incidents And now that that brought to attention leading very high level leading members, they're kind of a quote unquote in a state of shock and how long it's taking. So our co team feels quite confident with that. And we hope we can announce some things in the next coming months and to give some more colors. But I think some doors have opened to us that we were not aware of or we did not have ways to explore in the past few weeks. And we hope that that's gonna lead to some things we can share in the near future.

Great. I appreciate the additional commentary, Ronnie. I'll pass the floor.

Thank you. And Jack, from Maxim. Hi, Jack. How are you?

Hey, Ronnie. Doing doing well. Thanks for taking my questions, So it's great to see the continued momentum behind the scenes. And definitely see a good control over the operating expenses.

I do want to touch on the fourth quarter gross margin. So that did dip down a bit. Just wondering because I think you touched on that. Is this a blip? Is this seasonality And then what kind of can we expect for gross margin in the first half of the year, which might be seasonally slower? Thanks.

Yes. So with the gross margins as you know, we're starting to and I saw that we showed it on our [indiscernible] we're starting to bring all our products in with several joint ventures that we announced, and those products have really much higher gross margins than our standard e commerce products have. And we're blending, we're starting to blend in great products in And really, what we have is just to put more and more products We're going to start ceiling fans. It looks like very soon towards this summer with with high margins We're going to start some wall sconces, recess lights, indoor and outdoor wall sconces, including variety of chandeliers and downlights among exit signs and emergency lights and we anticipate very high high gross margins And our goal is just to blend them more in our system and that's in the process. Once we have the entire assortment, and we anticipate Q2, will be we probably can announce the entire assortment is in place. To see that affecting our gross margins. In addition to that, as we're doing the razor and the blade model, we currently going with our razors, receptacles into the market. Once the blades hit the ceiling smart ceiling fan, smart light fixture, and other light fixtures that also will help our gross margin And we also mentioned that we're working anticipating some major projects and major, hopefully significant orders to come.

So all of this together, we anticipate will significantly improve our gross margins as we keep on coming with more products from our joint ventures. And collaboration Okay. No. That that that's very helpful. Can I zero in maybe on you have tons of new announcements? Obviously, there's so much to talk about. But just to not take up everyone's time, let me just drill down on the Home Depot and Wayfair collaborations real quick Can I get an update just kind of how those relationships are performing or moving along I think you were expected to be in 100 initial Home Depot stores or online locations?

Can you just give an update on how that's been going and what you expect in 2025 from maybe Home Depot and Wayfair just in general? Thanks.

Yes, sure. As we for the other for our ecommerce 60 websites, we're using the same products plug and play products, including ceiling fans and smart ceiling fans, smart lighting, recess light and all the emergency lights and exit signs and indoor outdoor wall lanterns to arrive. And as they're arriving, we're also enhancing our product assortment in both Home Depot and in Wayfair. At Home Depot, we're also getting into stores, and we hope that, the more stores the more, a products we have online, the percentage of products going to store [indiscernible] will grow. We're working on some some in store programs that we can't disclose yet, but it's really for us, it's all about to have more and more product coming in We're very encouraged that the last several months since our last call every month, I would say products more and more products are coming into the country. And we're continuing that training of products and that supply chain to grow. And the more we grow it, it's going to influence positively both our programs in Home Depot and in Wayfair.

Okay. Great. I I'll hop back in the queue.

Thank you. And then we have Jerry from Roth Capital.

Hello, this is Brandon Rogers on for Jerry Sweeney. Can you guys hear me? Yes. Hello?

Yes.

Thanks for taking my call. So I just had a question about, bringing on, mister Long.

Given his background, does this have any impact to your strategy Any changes you guys are looking to implement in F twenty twenty five and any challenges on this front? Related to tariffs, you mean?

No. In terms of so just given his ecommerce background, [indiscernible] Yes. Correct. Yes.

Yes. So, yeah, Huey is really a veteran and well known actually was a director in Amazon and created Amazon's main Amazon Basic. That was their first brand out there. Today they have a hundred and he's really US leading ecommerce expert. And to bring a level high level talent in his level, he probably saw something into what we have and I'll take his word. He he started his career. As a as a buyer in Circuit City, and then he opened his own sourcing company grew it up from 0 to 800,000,000 at that time. And then sold it to the CEO of Circuit City And then we announced to to Amazon and Jeff Bezos that he sold his company. They grabbed him. And I'm saying that because his Circuit City experience is saying, we're gonna have 60 websites and hopefully, a lot of them soon. Starting to deep plug and play and down the right plug and play only, and that's going to give us, and we can still have competitive pricing that we don't need to significantly, if at all, to increase cost And that's kind of, he said, the Circuit City days, it's like selling TVs Circuit City would sell TVs with remote controls when the competitors will send them without.

So I think he's very optimistic and we're very happy to have a guy in that caliber come and explore and also some software options that can increase our conversion rates and competitive edge that he's working on. So we're quite excited and as I answered earlier, I think on another question, I think we'll have some announcements to with him in the coming months.

Thank you. And if I could just ask another one. Can you give me any updates on the continued expansion into the residential homebuilders channel? I know you said that you expect 20,000 homes by end of 1Q. And an additional tens of thousands of units in 2025. Any additional color on this front?

Yes. So as we announced, we we believe this quarter is going to be around 20,000 unitshomes with our products, and we have indications and started and we'll supply we believe tens of thousands hopefully on the higher side of tens of thousands, additional pipelines that we have here and that's with a variety of projects and we hope to be able to announce some of them the coming months. But we really have great feedback from builders, pro segment hotel owners, I don't know if we mentioned this, but not only the Shaner Group, 60 hotels, invested with us, and sixty Marriotts probably 20 Hilton's and InterContinental's that they own globally. And we hope to grow with them globally, but we also have one of our that round another leading investor that owns Waldorf Astoria, [indiscernible] several maybe 10 or more Hiltons that's also very excited. So for us, it's just to get the products here, and it's coming, it's slowly but surely. And again, I want to remind everyone it's a razor and the blade model. The razor always goes first. Sealing receptacle. And sometimes it can take you know, three to six to nine months until the blades come in, and that's where the revenue growth is anticipated.

So we're, very encouraged and on our razor and the blade model and we think that this program is really a great success for us We just need to get more blades, as we say, more products down here to accommodate demand. Thank you. And then if I could just ask one more You mentioned cash flow positive during second half twenty twenty five. Can you just walk me through what you need to accomplish to get to cash flow positive? You mentioned significant projects and orders. Any more to add there?

So it's a combination of orders that we anticipate in the razor and the blade model to more blades, more fixtures into the market and growing our collaborations with, that we announced on higher gross margins and getting more products here. So our management is confident that we have in the second half of the year, a path to get cash flow positive as we are going to get more products and more projects out there and anticipate some announcing some projects and orders in combination with our collaborations that all our in the direction of increasing gross margins, what we anticipate and expect that that can bring us to cash flow positive in the second half of twenty twenty five. Awesome. Thank you, Ronnie. Appreciate it. Thanks for taking my call.

Sure. Okay. Thank you very much. [indiscernible] We're looking forward to talk to you more and hopefully we can share more things that we're doing once we may come to fruition. But we're quite confident on on the company's direction And we'd like to say thank you, Steve Schmidt, our president, Dan our Co CEO, Lenny Sokolow, And thank you for you participating in that call. Looking forward for our next call. Thank you.

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