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- Revenue: $7.8 million in Q3 2024, a decrease from $8.2 million in Q3 2023.
- Gross Profit: Increased by 12% to $3.7 million in Q3 2024 from $3.3 million in Q3 2023.
- Gross Margin: Improved to 47% in Q3 2024 from 40% in Q3 2023.
- North America Revenue Growth: Increased by 30% year-on-year to $2 million in Q3 2024 from $1.6 million in Q3 2023.
- APAC Revenue Growth: Increased by 26% year-on-year.
- Operating Loss: $0.1 million in Q3 2024 compared to nil in Q3 2023.
- Net Loss: $0.2 million in Q3 2024, unchanged from Q3 2023.
- Adjusted EBITDA: $282,000 in Q3 2024, up from $240,000 in Q3 2023.
- Cash and Cash Equivalents: $6.7 million as of September 30, 2024, down from $8.1 million at December 31, 2023.
- Total (EPA:TTEF) Working Capital: $6.2 million as of September 30, 2024, down from $7.6 million at December 31, 2023.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Adcore Inc (ADCOF) achieved a 12% increase in gross profit, rising from 3.3 million in Q3 2023 to 3.7 million in Q3 2024.
- Gross margin improved significantly from 40% in Q3 2023 to 47% in Q3 2024.
- North America revenue grew by 30% year-on-year, becoming the second largest market for Adcore Inc (ADCOF).
- APAC region also showed strong growth with a 26% increase in revenue year-on-year.
- The company remains debt-free, maintaining a strong financial position with cash and cash equivalents of 6.7 million CAD as of September 30, 2024.
- Topline revenue saw a slight decline of 5%, from 8.2 million in Q3 2023 to 7.8 million in Q3 2024.
- EMEA region experienced a significant revenue decline of 39% year-on-year, attributed to geopolitical challenges.
- Operating loss increased to 0.1 million CAD in Q3 2024, primarily due to higher R&D and sales and marketing expenses.
- R&D expenses doubled compared to the previous year, driven by amortization of additional intangible assets.
- Total working capital decreased by 18% from December 2023, mainly due to a decrease in cash and cash equivalents and an increase in short-term liabilities.
A: Omri Brill (AS:BRIL), CEO: This trend has been ongoing for the past 8 to 10 quarters. The company has focused on profitability and efficiency, targeting activities and clients that generate higher gross margins. This focus, along with technology-driven, low-touch activities, has contributed to the improvement.
Q: Both North America and APAC showed impressive growth this quarter. Can you provide more information on what's driving the growth in those regions?
A: Omri Brill, CEO: Growth in these regions is primarily driven by new client acquisition. North America has been a focus for the past two years, with team expansion and a good market fit. APAC is recovering post-COVID, with growth driven by technology-related products.
Q: EMEA revenue decreased significantly. What's the reason for this?
A: Omri Brill, CEO: The decrease is due to geopolitical challenges in Europe and Israel. We believe this is a temporary setback and expect recovery in 2025.
Q: Revenue on the top line is relatively flat year over year. Can you explain the lack of growth?
A: Omri Brill, CEO: The flat revenue is mainly due to a decline in EMEA, despite strong growth in North America and APAC. The company prioritizes gross profit and margin over top-line growth, achieving a 12% increase in gross profit.
Q: R&D costs are relatively high for the quarter. Can you provide information on where the money is going?
A: Omri Brill, CEO: The increase is due to amortization of intangible assets and ongoing technology development. We view these expenses as strategic investments in technology, which is a key differentiator for us.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.