Los Angeles-based Ispire Technology (Nasdaq: ISPR) posted a 31.4% revenue rise for fiscal year 2024, beating analyst expectations as it plans to hop back into the U.S. nicotine market.
The vaping tech firm saw revenue climb to $151.9 million for the year ending June 30, up from $115.6 million in fiscal 2023. The figure surpassed the average analyst expectation of $148.83 million, according to Yahoo Finance.
However, the company still reported a net loss of $14.8 million, wider than the previous year’s $6 million loss, largely due to a 73% surge in operating expenses.
In statement, Co-CEO Michael Wang said the year was “foundational” and “marked by record revenue and substantial margin expansion while strategically positioning us for faster growth in our global nicotine business and intentionally focusing our cannabis vaping hardware on high quality multistate operator (MSO) customers.”
Wang continued, saying the company, “forged strategic long-term partnerships with industry leaders such as Acreage Holdings, Hidden Hills Club, Dank Pack, and BRKFST, a brand produced and sold under a license arrangement with international singer and songwriter Burna Boy.”
The firm’s expansion efforts also include a new manufacturing facility in Malaysia to tap into the international nicotine market, which management expects will help with costs and boost profitability in the coming years.
Ispire said it submitted its first Premarket Tobacco Product Application (PMTA) to the U.S. Food and Drug Administration this month for disposable nicotine vapes with four flavors, in a bid to re-enter the wider U.S. nicotine vaping scene. The company said age-verification technology for its vapes is also in the works.
Ispire maintained an optimistic outlook, especially after its $12.3 million public offering in in the spring to support “future international growth opportunities in both the nicotine and cannabis sectors.”
U.S. product sales rose to $63.1 million, while European vaping product sales reached $65.3 million. Sales in other markets, such as South Africa, grew to $6 million.
CFO Jim McCormick noted challenges with “slow-paying customers related to the systemic cash demands placed on the U.S. cannabis industry,” citing industry-specific tax requirements and regulatory issues.
Ispire had $35.1 million in cash and cash equivalents on hand by the end of June, with working capital of $16.6 million.
[[{“value”:”The firm’s losses widened off higher costs and a cannabis cash crunch, even as it seeks a FDA nod for a nicotine vapes return.
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