Latch - CW26 | 10-Q: FY2024 Q3 Revenue: USD 14.94 M

Revenue: As of FY2024 Q3, the actual value is USD 14.94 M.

EPS: As of FY2024 Q3, the actual value is USD -0.11.

EBIT: As of FY2024 Q3, the actual value is USD -17.79 M.

Financial Metrics by Segment

Revenue

• Hardware Revenue: $3.6 million for the three months ended September 30, 2024, compared to $3.2 million for the same period in 2023, an increase of 12.3%.
• Software Revenue: $5.1 million for the three months ended September 30, 2024, compared to $4.7 million for the same period in 2023, an increase of 8.9%.
• Professional Services Revenue: $6.3 million for the three months ended September 30, 2024, compared to $1.8 million for the same period in 2023, an increase of 247.9%.
• Total Revenue: $14.9 million for the three months ended September 30, 2024, compared to $9.7 million for the same period in 2023, an increase of 54.5%.

Cost of Revenue

• Hardware Cost of Revenue: $3.5 million for the three months ended September 30, 2024, compared to $1.4 million for the same period in 2023, an increase of 153.9%.
• Software Cost of Revenue: $0.5 million for the three months ended September 30, 2024, compared to $0.5 million for the same period in 2023, a decrease of 4.9%.
• Professional Services Cost of Revenue: $4.8 million for the three months ended September 30, 2024, compared to $1.6 million for the same period in 2023, an increase of 193.4%.
• Total Cost of Revenue: $8.9 million for the three months ended September 30, 2024, compared to $3.6 million for the same period in 2023, an increase of 147.8%.

Operating Expenses

• Research and Development: $4.9 million for the three months ended September 30, 2024, compared to $10.2 million for the same period in 2023, a decrease of 52.4%.
• Sales and Marketing: $4.0 million for the three months ended September 30, 2024, compared to $3.8 million for the same period in 2023, an increase of 3.5%.
• General and Administrative: $12.8 million for the three months ended September 30, 2024, compared to $18.8 million for the same period in 2023, a decrease of 31.7%.
• Depreciation and Amortization: $1.8 million for the three months ended September 30, 2024, compared to $1.9 million for the same period in 2023, a decrease of 2.7%.
• Total Operating Expenses: $23.5 million for the three months ended September 30, 2024, compared to $34.7 million for the same period in 2023, a decrease of 32.4%.

Other Income, Net

• Change in Fair Value of Warrant Liability: - $0.1 million for the three months ended September 30, 2024, compared to $0.6 million for the same period in 2023, a decrease of 111.0%.
• Interest Income, Net: $0.4 million for the three months ended September 30, 2024, compared to $0.8 million for the same period in 2023, a decrease of 49.9%.
• Other (Expense), Net: - $0.01 million for the three months ended September 30, 2024, compared to - $0.03 million for the same period in 2023, an increase of 54.8%.
• Total Other Income, Net: $0.3 million for the three months ended September 30, 2024, compared to $1.3 million for the same period in 2023, a decrease of 75.2%.

Net Loss

• Net Loss: - $17.1 million for the three months ended September 30, 2024, compared to - $27.3 million for the same period in 2023, a decrease of 37.5%.

Future Outlook and Strategy

Core Business Focus

• The Company plans to continue expanding its DOOR Platform and device integrations to encompass broader smart home solutions, managing devices such as sensors, thermostats, and lighting.
• The Company aims to create a building intelligence platform, automating and streamlining building operations, including work order management and automation, property maintenance, and unit inspections and repairs.

Non-Core Business

• The Company is actively expanding its professional services offerings, including connecting multifamily property customers with partners for installation of Latch and third-party smart access and smart home hardware.
• The HelloTech platform, in combination with the technology acquired in the HDW Acquisition, supports the Company’s professional services offering, providing a scalable, nationwide network of skilled independent technicians.

Priority

• The Company emphasizes the importance of communication between the sales, accounting, and finance departments regarding key terms of, and changes or modifications to, sales transactions, including by establishing controls requiring finance department approval of certain non-standard terms.
• The Company plans to continue to design and implement control activities to mitigate risks identified and test the operating effectiveness of such controls.