UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(MARK ONE)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarter ended June 30, 2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-39642

CXApp Inc.

(Exact name of Registrant as Specified in Its Charter)

Delaware

85-2104918

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

Four Palo Alto Square, Suite 200

3000 El Camino Real

Palo Alto, CA 94306

(Address of principal executive offices, zip code)

(650) 785-7171

(Registrant’s telephone number)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Class A common stock, $0.0001 par value per share	CXAI	The Nasdaq Stock Market LLC
Warrants to purchase common stock	CXAIW	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

As of August 12, 2024, there were 15,266,959 shares of Class A common stock, $0.0001 par value, issued and outstanding.

CXAPP INC.

TABLE OF CONTENTS

Part I. FINANCIAL INFORMATION

	Item 1.	Interim Financial Statements	1
		Condensed Consolidated Balance Sheets as of June 30, 2024 (unaudited) and December 31, 2023	1
		Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and six months ended June 30, 2024 (unaudited) (Successor) and Condensed Consolidated Statements of Operations and Comprehensive Loss for the period from March 15, 2023 to June 30, 2023 (unaudited) (Successor), and the period from January 1, 2023 to March 14, 2023 (Predecessor)	2
		Condensed Consolidated Statements of Stockholders’ Equity for the three and six months ended June 30, 2024 (unaudited) (Successor) and Condensed Consolidated Statements of Stockholders’ Equity for the period from March 15, 2023 to June 30, 2023 (unaudited) (Successor), and the period from January 1, 2023 to March 14, 2023 (Predecessor)	3
		Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2024 (unaudited) (Successor) and Condensed Consolidated Statements of Cash Flows for the period from March 15, 2023 to June 30, 2023 (unaudited) (Successor), and the period from January 1, 2023 to March 14, 2023 (Predecessor)	4
		Notes to Unaudited Condensed Consolidated Financial Statements	5
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	29
	Item 3.	Quantitative and Qualitative Disclosures about Market Risk	39
	Item 4.	Controls and Procedures	39

Part II. OTHER INFORMATION

	Item 1.	Legal Proceedings	40
	Item 1A.	Risk Factors	40
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	40
	Item 3.	Defaults Upon Senior Securities	40
	Item 4.	Mine Safety Disclosures	40
	Item 5.	Other Information	40
	Item 6.	Exhibits	41

SIGNATURES			42

PART I. FINANCIAL INFORMATION

Item 1: Interim Financial Statements

CXAPP INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share data)


	June 30, 2024			December 31, 2023
	(unaudited)
Assets

Current Assets
Cash and cash equivalents	$	6,160		$	6,275
Accounts receivable, net of allowance for credit losses of $0 and $2, respectively		438			1,956
Unbilled and other receivables		171			211
Prepaid expenses and other current assets		663			587
Total current assets		7,432			9,029

Property and equipment, net		95			115
Intangible assets, net		16,770			18,136
Operating lease right-of-use asset, net		664			486
Goodwill		8,737			8,737
Other assets		76			78

Total Assets	$	33,774		$	36,581

Liabilities and Stockholders’ Equity

Current Liabilities
Accounts payable	$	584		$	975
Accrued liabilities		2,021			1,452
Deferred revenue		2,936			2,878
Warrant liability		4,206			1,683
Operating lease obligation, current		389			275
Note payable		4,103			3,053
Total current liabilities		14,239			10,316

Operating lease obligation, noncurrent		288			230
Deferred tax liability		270			637
Convertible debt		2,493			-
Other noncurrent liabilities		4			-

Total Liabilities	$	17,294		$	11,183

Commitments and Contingencies

Stockholders’ Equity
Class A Common Stock, $0.0001 par value; 200,000,000 shares authorized; 15,266,959 shares issued and outstanding at June 30, 2024 and 15,254,389 shares issued and outstanding at December 31, 2023		2			2
Additional paid-in capital		84,714			83,282
Accumulated deficit		(68,227	)		(57,801	)
Accumulated other comprehensive loss		(9	)		(85	)
Total Stockholders’ Equity	$	16,480		$	25,398

Total Liabilities and Stockholders’ Equity	$	33,774		$	36,581

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

CXAPP INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND

COMPREHENSIVE LOSS

(in thousands, except share and per share data)


	Successor								Predecessor
	(unaudited)
	Three Months Ended June 30, 2024		Six Months Ended June 30, 2024		Three Months Ended June 30, 2023		Period from March 15, 2023 to June 30, 2023		Period from January 1, 2023 to March 14, 2023
Revenues	$	1,766	$	3,584	$	1,915	$	2,257	$	1,620

Cost of Revenues		353		680		480		567		483

Gross Profit		1,413		2,904		1,435		1,690		1,137

Operating Expenses
Research and development		1,731		3,330		1,668		1,879		1,455
Sales and marketing		874		1,988		1,177		1,351		964
General and administrative		1,775		3,457		1,412		1,653		2,293
Acquisition related costs		-		-		164

SEC Form 10-Q filed by CXApp Inc.