Fort Lauderdale, FL, Aug. 20, 2025 (GLOBE NEWSWIRE) -- Algorhythm Holdings, Inc. ("Algorhythm") (NASDAQ: RIME) - an AI technology holding company, announced today its results of operations for the second quarter ended June 30, 2025.
Second Quarter Financial Highlights:
- Revenues increased to $2.7 million in the second quarter of 2025 compared to $2.4 million in the same period last year.
- Gross profit margin increased to 35.1% in the second quarter of 2025 from 13.3% in the same period of the prior year. Gross profit was approximately $1.0 million for the second quarter 2025.
- Total operating expenses decreased by $4.8 million to $1.7 million in the second quarter of 2025, compared to $6.5 million in the same period last year.
- Net loss decreased by $5.3 million to $0.8 million for the second quarter of 2025 compared to $6.1 million in the same period last year.
- Cash on hand was $1.1 million as of June 30, 2025.
Second Quarter Business Highlights:
Algorhythm had a breakthrough quarter, marked by several major accomplishments since the beginning of the quarter. Most notable were the following:
- Algorhythm completed the acquisition of SMCB Solutions Private Ltd. ("SemiCab India"), the Indian managed services provider of SemiCab's AI logistics platform.
- Algorhythm completed the sale of its consumer karaoke subsidiary, Singing Machine, for $4.5 million, trimming approximately $4.0 million in liabilities and strengthening its balance sheet.
- SemiCab won five new contracts with leading multinational fast moving consumer goods ("FMCG") companies in India, expanding its footprint in the country's high-growth logistics market.
- Four existing contracts were expanded, with lanes and volumes increasing by 100%-200%, driving significant revenue growth potential.
- Fleet size increased from 140 to 450 trucks, positioning SemiCab to raise its annualized revenue run rate to $23 million.
"Our second quarter was marked by the achievement of several milestones that built upon the momentum that we gathered during our first quarter," stated Gary Atkinson, Chief Executive Officer of Algorhythm. "With the acquisition of SemiCab India and the sale of our Singing Machine business, we transformed Algorhythm Holdings into a high-growth, technology-focused AI distribution and logistics company while significantly reducing our cash burn and strengthening our balance sheet."
Mr. Atkinson continued, "We are now a people-light, asset-light, nimble and a cutting-edge technology company serving some of the largest consumer packaged goods companies in the world. Our SemiCab business has grown almost 300% from an annualized revenue run rate (ARR) of approximately $2 million in January to more than $7 million today, and is still quickly growing. We plan to develop our pipeline of pending contracts with new transporters to grow our fleet to over 1,000 vehicles by the end of 2025 to keep pace with demand. As more shippers and carriers join our platform, the flywheel begins to spin-network effects grow, and opportunities to optimize truck utilization multiply, unlocking significant value."
Q2 2025 Financial Summary
"Revenue for Q2 increased to $2.7 million, up from $2.4 million in the same period last year, driven primarily by the contribution from our SemiCab India acquisition, even for a partial quarter," said Alex Andre, Chief Financial Officer of Algorhythm.
"Net loss improved dramatically to $0.8 million, compared to a net loss of $6.1 million last year, reflecting a $3.9 million reduction in operating lease impairment and lower general and administrative expenses," Mr. Andre continued. "We expect net loss to continue trending lower over the next 12 months, primarily due to the sale of Singing Machine and the corresponding reduction in operating expenses which will be partially offset by strategic investments to accelerate growth in our SemiCab business."
Conference Call Details:
Date: Wednesday, August 20, 2025
Time: 10:00 a.m. EDT
Dial-in number: 888-999-3182
Conference ID: RIME
An audio rebroadcast of the call will be available later in the day at:
https://ir.algoholdings.com
About Algorhythm Holdings
Algorhythm Holdings, Inc. is an AI technology company focused on the growth and development of SemiCab, an emerging leader in the global logistics and distribution industry. Since 2020, SemiCab has enabled major retailers, brands and transportation providers to address these common supply-chain problems globally. Its AI-enabled, cloud-based Collaborative Transportation Platform achieves the scalability required to predict and optimize millions of loads and hundreds of thousands of trucks. SemiCab uses real-time data from API-based load tendering and pre-built integrations with TMS and ELD partners to orchestrate collaboration across manufacturers, retailers, distributors, and their carriers. SemiCab uses AI/ML predictions and advanced predictive optimization models to enable fully loaded round trips. With SemiCab's AI platform, shippers pay less and carriers make more without having to change a thing.
For additional information, please go to: http://www.semicab.com
Investor Relations Contact:
Brendan Hopkins
407-645-5295
investors@algoholdings.com
www.algoholdings.com
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Any statement that is not historical in nature is a forward-looking statement and may be identified by the use of words and phrases such as "expects," "anticipates," "believes," "will," "will likely result," "will continue," "plans to," "potential," "promising," and similar expressions. These statements are based on management's current expectations and beliefs and are subject to a number of risks, uncertainties and assumptions that could cause actual results to differ materially from those described in the forward-looking statements, including the risk factors described from time to time in Algorhythm's reports to the SEC, including, without limitation Algorhythm's Annual Report on Form 10-K for the year ended December 31, 2024. You should not place undue reliance on any forward-looking statement, each of which applies only as of the date of this press release. Except as required by law, we undertake no obligation to update or revise publicly any of the forward-looking statements after the date of this press release to conform our statements to actual results or changed expectations, or as a result of new information, future events or otherwise.
Algorhythm Holdings, Inc. and Subsidiaries
CONDENSED CONSOLIDATED BALANCE SHEETS
| June 30, 2025 | December 31, 2024 | |||||||
| (unaudited) | ||||||||
| Assets | ||||||||
| Current Assets | ||||||||
| Cash | $ | 1,134,000 | $ | 7,550,000 | ||||
| Accounts receivable, net of allowances of $101,000 and $274,000, respectively | 2,317,000 | 4,373,000 | ||||||
| Accounts receivable, related party | 124,000 | 212,000 | ||||||
| Note receivable - related party | - | 701,000 | ||||||
| Inventory | 2,733,000 | 2,186,000 | ||||||
| Returns asset | 93,000 | 1,621,000 | ||||||
| Prepaid expenses and other current assets | 1,219,000 | 120,000 | ||||||
| Total Current Assets | 7,620,000 | 16,763,000 | ||||||
| Property and equipment, net | 252,000 | 284,000 | ||||||
| Other non-current assets | 90,000 | 124,000 | ||||||
| Intangible assets, net | 315,000 | 345,000 | ||||||
| Goodwill | 4,418,000 | 786,000 | ||||||
| Total Assets | $ | 12,695,000 | $ | 18,302,000 | ||||
| Liabilities and Shareholders' Equity | ||||||||
| Current Liabilities | ||||||||
| Accounts payable | $ | 1,996,000 | $ | 3,808,000 | ||||
| Accrued expenses | 3,295,000 | 4,224,000 | ||||||
| Refund due to customer | 1,232,000 | 38,000 | ||||||
| Reserve for sales returns | 521,000 | 3,355,000 | ||||||
| Warrant liability | - | 16,603,000 | ||||||
| Promissory notes payable,net | 379,000 | - | ||||||
| Current portion of promissory note payable - SemiCab, Inc. | 1,500,000 | - | ||||||
| Current portion of notes payable to related parties | 265,000 | 265,000 | ||||||
| Other current liabilities | 62,000 | 145,000 | ||||||
| Total Current Liabilities | 9,250,000 | 28,438,000 | ||||||
| Notes payable to related parties, net of current portion | 385,000 | 385,000 | ||||||
| Promoissory note payable - SemiCab, Inc., net of current portion | 250,000 | - | ||||||
| Total Liabilities | 9,885,000 | 28,823,000 | ||||||
| Commitments and Contingencies | ||||||||
| Shareholders' Equity (Deficit) | ||||||||
| Preferred stock, $1.00 par value; 1,000,000 shares authorized; no shares issued and outstanding at June 30, 2025 and December 31, 2024 | - | - | ||||||
| Common stock, $0.01 par value; 800,000,000 and 100,000,000 shares authorized; 2,514,571 and 470,825 shares issued and outstanding at June 30, 2025 and December 31, 2024 | 25,000 | 5,000 | ||||||
| Additional paid-in capital | 63,854,000 | 39,682,000 | ||||||
| Accumulated deficit | (58,948,000 | ) | (49,172,000 | ) | ||||
| Non-controlling interest | (1,363,000 | ) | (1,036,000 | ) | ||||
| Treasury stock, 10,990 and 0 shares reserved at June 30, 2025 and December 31, 2024 | (758,000 | ) | - | |||||
| Total Algorhythm Holdings Shareholders' Equity (Deficit) | 2,810,000 | (10,521,000 | ) | |||||
| Total Liabilities and Shareholders' Equity (Deficit) | $ | 12,695,000 | $ | 18,302,000 | ||||
Algorhythm Holdings, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| For the Three Months Ended | For the Six Months Ended | |||||||||||||||
| June 30, 2025 | June 30, 2024 | June 30, 2025 | June 30, 2024 | |||||||||||||
| Net Sales | $ | 2,716,000 | $ | 2,440,000 | $ | 4,709,000 | $ | 4,866,000 | ||||||||
| Cost of Goods Sold | 1,762,000 | 2,116,000 | 3,255,000 | 4,040,000 | ||||||||||||
| Gross Profit | 954,000 | 324,000 | 1,454,000 | 826,000 | ||||||||||||
| Operating Expenses | ||||||||||||||||
| Selling expenses | 234,000 | 547,000 | 998,000 | 1,177,000 | ||||||||||||
| General and administrative expenses | 1,502,000 | 2,053,000 | 4,048,000 | 4,212,000 | ||||||||||||
| Operating lease impairment expense | - | 3,878,000 | - | 3,878,000 | ||||||||||||
| Total Operating Expenses | 1,736,000 | 6,478,000 | 5,046,000 | 9,267,000 | ||||||||||||
| Loss from Operations | (782,000 | ) | (6,154,000 | ) | (3,592,000 | ) | (8,441,000 | ) | ||||||||
| Other Expenses | ||||||||||||||||
| Change in fair value of warrant liability | - | - | (6,468,000 | ) | - | |||||||||||
| Interest expense | (27,000 | ) | (17,000 | ) | (43,000 | ) | (45,000 | ) | ||||||||
| Total Other Expenses | (27,000 | ) | (17,000 | ) | (6,511,000 | ) | (45,000 | ) | ||||||||
| Loss Before Income Tax Benefit | (809,000 | ) | (6,171,000 | ) | (10,103,000 | ) | (8,486,000 | ) | ||||||||
| Income Tax Benefit | - | 52,000 | - | - | ||||||||||||
| Net Loss | (809,000 | ) | (6,119,000 | ) | (10,103,000 | ) | (8,486,000 | ) | ||||||||
| Net loss attributable to non-controlling interest | 224,000 | - | 327,000 | - | ||||||||||||
| Net Loss Available to Common Shareholders | $ | (585,000 | ) | $ | (6,119,000 | ) | $ | (9,776,000 | ) | $ | (8,486,000 | ) | ||||
| Income (Loss) Per Common Share | ||||||||||||||||
| Basic and diluted | $ | (0.24 | ) | $ | (190.68 | ) | $ | (4.40 | ) | $ | (264.44 | ) | ||||
| Weighted Average Common and Common | ||||||||||||||||
| Equivalent Shares: | ||||||||||||||||
| Basic and diluted | 2,472,464 | 32,090 | 2,224,047 | 32,090 | ||||||||||||
Algorhythm Holdings, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| For the Six Months Ended | ||||||||
| June 30, 2025 | June 30, 2024 | |||||||
| Cash flows from operating activities | ||||||||
| Net loss | $ | (10,103,000 | ) | $ | (8,486,000 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation and amortization | 96,000 | 125,000 | ||||||
| Reduction in SMCB loan in exchange for services | 304,000 | - | ||||||
| Gain on allowance for credit loss | (439,000 | ) | - | |||||
| Change in fair value of warrant liability | 6,468,000 | - | ||||||
| Provision for estimated cost of returns | 1,528,000 | 1,301,000 | ||||||
| Provision for inventory obsolescence | 4,000 | - | ||||||
| Credit losses | 3,000 | 14,000 | ||||||
| Impairment expense | - | 3,878,000 | ||||||
| Reserve for sales returns | (2,834,000 | ) | (1,217,000 | ) | ||||
| Stock-based compensation | 47,000 | 36,000 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | 2,372,000 | 4,945,000 | ||||||
| Due from banks | - | (187,000 | ) | |||||
| Accounts receivable - related parties | 88,000 | (145,000 | ) | |||||
| Inventories | (551,000 | ) | (38,000 | ) | ||||
| Prepaid expenses and other current assets | (722,000 | ) | 69,000 | |||||
| Other non-current assets | 523,000 | (64,000 | ) | |||||
| Accounts payable | (2,184,000 | ) | (3,940,000 | ) | ||||
| Accrued expenses | (1,147,000 | ) | (771,000 | ) | ||||
| Refunds due to customers | 1,194,000 | (649,000 | ) | |||||
| Other liabilities | (83,000 | ) | (281,000 | ) | ||||
| Net cash used in operating activities | (5,436,000 | ) | (5,410,000 | ) | ||||
| Cash flows from investing activities | ||||||||
| Purchase of property and equipment | (22,000 | ) | (6,000 | ) | ||||
| Repurchase of shares of common stock | (758,000 | ) | - | |||||
| Cash received from acquisition of SMCB | 593,000 | - | ||||||
| Advances to SMCB | (1,172,000 | ) | - | |||||
| Net cash used in investing activities | (1,359,000 | ) | (6,000 | ) | ||||
| Cash flows from financing activities | ||||||||
| Proceeds from issuance of promissory notes, net | 379,000 | - | ||||||
| Other | - | (42,000 | ) | |||||
| Net cash provided by (used in) financing activities | 379,000 | (42,000 | ) | |||||
| Net change in cash | (6,416,000 | ) | (5,458,000 | ) | ||||
| Cash at beginning of year | 7,550,000 | 6,703,000 | ||||||
| Cash at end of period | $ | 1,134,000 | $ | 1,245,000 | ||||
| Supplemental disclosures of cash flow information: | ||||||||
| Cash paid for interest | $ | 43,000 | $ | 40,000 | ||||
| Non-Cash investing and financing cash flow information: | ||||||||
| Reclassification of Series A warrants to equity | $ | 7,857,000 | $ | - | ||||
| Common stock issued for exercise of Series B warrants | $ | 15,214,000 | $ | - | ||||
| Common stock issued for acquisition of SMCB | $ | 316,000 | $ | - | ||||
| Promissory note issued for acquisition of SMCB | $ | 1,750,000 | $ | - | ||||
