Xiao-I Corporation Announces Strong 2024 Results: Revenue Up 19% with Path to Profitability in 2025
Rhea-AI Summary
Xiao-I Corporation (NASDAQ: AIXI) reported strong financial results for 2024, with revenue reaching $70.31 million, up 18.8% year-over-year. The company's gross profit increased 21.9% to $48.05 million, with improved gross margin of 68.3%. Net loss narrowed significantly by 46.1% to $14.55 million, supported by a 33.8% reduction in R&D expenses to $34.66 million.
The growth was primarily driven by increased demand for Hua Zang LLM-powered Model-as-a-Service solutions and AI hardware sales. The company expects to achieve profitability in 2025, while managing risks from US-China technology decoupling and supply chain challenges. Xiao-I is also awaiting a court ruling in its patent infringement case against Apple Inc.
Positive
- Revenue grew 18.8% YoY to $70.31 million
- Gross profit increased 21.9% to $48.05 million with margin expansion to 68.3%
- Net loss reduced by 46.1% to $14.55 million
- R&D expenses decreased 33.8% to $34.66 million, showing improved efficiency
- Company projects reaching profitability in 2025
Negative
- Still operating at a loss with $14.55 million net loss in 2024
- Faces risks from US-China technology decoupling affecting hardware procurement
- Potential supply chain disruptions due to regional conflicts
- Ongoing legal uncertainty with Apple patent infringement case
Insights
Xiao-I shows strong fundamentals with 19% revenue growth, improved margins, and 46% reduced losses, positioning for 2025 profitability.
Xiao-I Corporation's 2024 results demonstrate robust financial momentum with revenue reaching
The company has made significant strides in operational efficiency, reducing R&D expenses by
The ongoing patent litigation against Apple represents both a potential risk and opportunity. A favorable ruling could provide a significant windfall and validate their intellectual property portfolio, while an unfavorable outcome could impact future licensing revenue streams.
Management has identified key risks including US-China technology decoupling and supply chain vulnerabilities for hardware components. Their strategy of maintaining
Profitability Roadmap: Efficiency and Discipline
Key Financial Highlights
- Revenue Growth: revenue for 2024 reached approximately
- Gross Profit: Gross profit increased from
- Margin Expansion: Gross profit margin improved to
- R&D Expenses: Research and development expenses totaled
- Net Loss Reduction: Net loss narrowed significantly to
Material Unfinished Matters
During the fiscal year 2024, Xiao-I Corporation pursued legal proceedings against Apple Inc. regarding alleged patent infringement. Key developments in the case include:
- July 31, 2024: The trial phase of the lawsuit concluded.
- September 24, 2024: The Shanghai High People's Court held a hearing session, attended by legal representatives from both parties.
- November 1, 2024: The Shanghai High People's Court held a second hearing session.
As of the date of this release, all legal processes have been completed, with all parties awaiting the court's final ruling.
Management Comment
"2024 marks our evolution into a mature AI-driven growth company, powered by the Hua Zang LLM foundation. Going forward, while advancing profitability through hardware innovations like AI Glasses and tAIkbox, we confront material risks requiring vigilant management. Geopolitical fragmentation—particularly US-China technology decoupling—impacts hardware procurement cycles and cross-border service deployments. Also, multi-tier supply chain resilience remains critical for AI hardware scaling, with regional conflicts posing potential component shortages. With
About Xiao-I Corporation
Xiao-I Corporation is a leading cognitive intelligence enterprise in China that offers a diverse range of business solutions and services in artificial intelligence, covering natural language processing, voice and image recognition, machine learning, and affective computing. Since its inception in 2001, the Company has developed an extensive portfolio of cognitive intelligence technologies that are highly suitable and have been applied to a wide variety of business cases. Xiao-I powers its cognitive intelligence products and services with its cutting-edge, proprietary AI technologies to enable and promote industrial digitization, intelligent upgrading, and transformation. For more information, please visit: www.xiaoi.com.
Forward-Looking Statements
This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. When the Company uses words such as "may," "will," "intend," "should," "believe," "expect," "anticipate," "project," "estimate" or similar expressions that do not relate solely to historical matters, it is making forward-looking statements. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that may cause the actual results to differ materially from the Company's expectations discussed in the forward-looking statements. These statements are subject to uncertainties and risks including, but not limited to, the following: the Company's ability to achieve its goals and strategies, the Company's future business development and plans for future business development, including its financial conditions and results of operations, product and service demand and acceptance, reputation and brand, the impact of competition and pricing, changes in technology, government regulations, fluctuations in general economic and business conditions in China, and assumptions underlying or related to any of the foregoing and other risks contained in reports filed by the Company with the U.S. Securities and Exchange Commission ("SEC"). For these reasons, among others, investors are cautioned not to place undue reliance upon any forward-looking statements in this press release. Additional factors are discussed in the Company's filings with the SEC, including under the section entitled "Risk Factors" in its annual report on Form 20-F filed with the SEC on May 15, 2025, as well as its current reports on Form 6-K and other filings, all of which are available for review at www.sec.gov. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.
For investor and media inquiries, please contact:
Ms. Berry Xia
Email: ir@xiaoi.com
XIAO-I CORPORATION CONSOLIDATED BALANCE SHEETS (In U.S. dollars, except for share and per share data, or otherwise noted) | ||||||||
As of December 31, | ||||||||
2023 | 2024 | |||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 1,564,542 | $ | 846,593 | ||||
Restricted cash | 20,676 | - | ||||||
Accounts receivable, net | 28,326,985 | 55,543,017 | ||||||
Amounts due from related parties, current | - | 13,587,536 | ||||||
Inventories | 67,826 | 14,362 | ||||||
Contract costs | 1,691,293 | 2,502,678 | ||||||
Advance to suppliers | 1,149,642 | 3,205,098 | ||||||
Prepaid expenses and other current assets, net | 5,233,553 | 792,732 | ||||||
Total current assets | 38,054,517 | 76,492,016 | ||||||
Non-current assets: | ||||||||
Property and equipment, net | 2,125,629 | 1,867,736 | ||||||
Intangible assets, net | 212,445 | 143,370 | ||||||
Long-term investments | 2,650,458 | 2,497,594 | ||||||
Right of use assets | 2,431,475 | 833,030 | ||||||
Prepaid expenses and other non-current assets | 7,000,357 | 3,677,728 | ||||||
Amount due from related parties, non-current | 13,859,350 | - | ||||||
Total non-current assets | 28,279,714 | 9,019,458 | ||||||
TOTAL ASSETS | $ | 66,334,231 | $ | 85,511,474 | ||||
Liabilities | ||||||||
Current liabilities: | ||||||||
Short-term borrowings | $ | 26,760,940 | $ | 32,879,865 | ||||
Accounts payable | 13,674,339 | 27,131,439 | ||||||
Amount due to related parties, current | 704,947 | 217,068 | ||||||
Deferred revenue | 1,654,145 | 2,385,228 | ||||||
Convertible loans | - | 216,756 | ||||||
Accrued expenses and other current liabilities | 13,938,253 | 23,289,453 | ||||||
Lease liabilities, current | 929,755 | 483,658 | ||||||
Total current liabilities | 57,662,379 | 86,603,467 | ||||||
Non-current liabilities: | ||||||||
Amount due to related parties, non-current | 7,905,290 | 7,336,833 | ||||||
Accrued liabilities, non-current | 7,759,474 | 7,043,185 | ||||||
Lease liabilities, non-current | 1,473,950 | 295,962 | ||||||
Total non-current liabilities | 17,138,714 | 14,675,980 | ||||||
TOTAL LIABILITIES | 74,801,093 | 101,279,447 | ||||||
Commitments and Contingencies
| - | - | ||||||
Shareholders' deficit Ordinary shares (par value of | $ | 1,201 | $ | 1,598 | ||||
Preferred shares (par value of | 185 | 185 | ||||||
Additional paid-in capital | 108,729,047 | 115,745,140 | ||||||
Statutory reserve | 237,486 | 237,486 | ||||||
Accumulated deficit | (110,833,045) | (125,338,509) | ||||||
Accumulated other comprehensive loss | (2,998,562) | (2,848,314) | ||||||
XIAO-I CORPORATION shareholders' deficit | (4,863,688) | (12,202,414) | ||||||
Non-controlling interests | (3,603,174) | (3,565,559) | ||||||
Total shareholders' deficit | (8,466,862) | (15,767,973) | ||||||
TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIT | $ | 66,334,231 | $ | 85,511,474 | ||||
XIAO-I CORPORATION | ||||||||||||
For the years ended December 31, | ||||||||||||
2022 | 2023 | 2024 | ||||||||||
Sale of software products | $ | 3,547,113 | $ | 1,566,455 | $ | 1,516,169 | ||||||
Sale of hardware products | 46,295 | 75,363 | 1,395,345 | |||||||||
Technology development service | 16,419,889 | 7,839,700 | 24,105,644 | |||||||||
M&S service | 2,429,526 | 2,676,185 | 2,419,901 | |||||||||
Sale of cloud platform products | 25,742,135 | 47,007,556 | 40,877,256 | |||||||||
Net revenues | 48,184,958 | 59,165,259 | 70,314,315 | |||||||||
Cost of sale of software products | (888,220) | (834,570) | (98,442) | |||||||||
Cost of sale of hardware products | (25,141) | (51,201) | (583,939) | |||||||||
Cost of technology development service | (12,194,044) | (6,059,330) | (10,444,827) | |||||||||
Cost of M&S service | (1,255,973) | (971,417) | (781,258) | |||||||||
Cost of sale of cloud platform products | (3,015,766) | (11,825,171) | (10,356,302) | |||||||||
Cost of revenues | (17,379,144) | (19,741,689) | (22,264,768) | |||||||||
Gross profit | 30,805,814 | 39,423,570 | 48,049,547 | |||||||||
Operating expenses: | ||||||||||||
Selling expenses | (3,911,818) | (4,550,997) | (3,320,886) | |||||||||
General and administrative expenses | (6,028,637) | (4,407,215) | (22,940,916) | |||||||||
Research and development expenses | (24,001,138) | (52,387,540) | (34,658,779) | |||||||||
Total operating expenses | (33,941,593) | (61,345,752) | (60,920,581) | |||||||||
Loss from operations | (3,135,779) | (21,922,182) | (12,871,034) | |||||||||
Other income/(expenses): | ||||||||||||
Investment (loss)/income | (143,181) | 75,542 | (81,618) | |||||||||
Interest expenses, net | (2,440,815) | (2,323,341) | (2,319,820) | |||||||||
Foreign currency exchange (loss)/gain | (68,902) | 2,789 | 3,864 | |||||||||
Other income, net | 444,018 | 949,116 | 717,280 | |||||||||
Total other expenses | (2,208,880) | (1,295,894) | (1,680,294) | |||||||||
Loss before income tax expense | (5,344,659) | (23,218,076) | (14,551,328) | |||||||||
Income tax expense | (660,655) | (3,787,692) | - | |||||||||
Net loss | $ | (6,005,314) | $ | (27,005,768) | $ | (14,551,328) | ||||||
Net loss attributable to non-controlling interests | (106,779) | (543,961) | (45,864) | |||||||||
Net loss attributable to XIAO-I CORPORATION | (5,898,535) | (26,461,807) | (14,505,464) | |||||||||
Other comprehensive income | ||||||||||||
Foreign currency translation change, net of nil income | 403,816 | 303,114 | 233,727 | |||||||||
Total other comprehensive income | 403,816 | 303,114 | 233,727 | |||||||||
Total comprehensive loss | $ | (5,601,498) | $ | (26,702,654) | $ | (14,317,601) | ||||||
Total comprehensive income/(loss) attributable to non- | 95,280 | (504,951) | 37,615 | |||||||||
Total comprehensive loss attributable to XIAO-I | (5,696,778) | (26,197,703) | (14,355,216) | |||||||||
Loss per ordinary share attributable to XIAO-I | ||||||||||||
Basic | (0.27) | (1.12) | (0.56) | |||||||||
Diluted | (0.27) | (1.12) | (0.56) | |||||||||
Weighted average number of ordinary shares | ||||||||||||
Basic | 22,115,592 | 23,646,003 | 25,760,207 | |||||||||
Diluted | 22,115,592 | 23,646,003 | 25,760,207 | |||||||||
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SOURCE Xiao I Corporation
FAQ
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