The Singing Machine Company, Inc. - MICS STOCK NEWS

The Singing Machine Company (NASDAQ: MICS) has provided an update on its acquisition of SemiCab, Inc., a leading AI technology company in global logistics. The company is finalizing the acquisition of SMCB Solutions Private , SemiCab's Indian subsidiary, which is expected to be completed within 45 days. SMCB has over $9 million in contracted services pipeline from existing client commitments, not including potential increases from two major customers.

Key highlights:

• SMCB's last twelve months sales as of March 31, 2024, were approximately $1.35 million (unaudited)
• The Indian operations are expected to be the primary driver for near-term revenue growth
• The acquisition is seen as the final step in integrating SemiCab's AI logistics business into Singing Machine's holding company structure
• Management views the Indian operations as the largest source of overall revenue growth for the next 12 months

The Singing Machine Company (NASDAQ: MICS) has completed its acquisition of SemiCab, a leading AI logistics firm. CEO Gary Atkinson emphasized the transaction's potential to overhaul their growth prospects and shareholder value. SemiCab, awarded Gartner Cool Vendor in 2020, is known for its cutting-edge AI technology and notable clientele. The company’s software, which launched in 2021, has shown significant improvements in freight utilization and cost savings. The deal included issuing 641,806 shares of Singing Machine’s common stock to SemiCab and assuming $2.6 million in liabilities. Additionally, Singing Machine has an option to acquire SemiCab’s Indian subsidiary, which generated $1.4 million in sales over the past year. This acquisition aims to enhance Singing Machine’s market position and operational efficiencies.

The Singing Machine (NASDAQ: MICS) announced the acquisition of SemiCab, an AI logistics tech firm, to enhance growth and shareholder value.

SemiCab, with $6 million revenue in 2023, optimizes freight for Fortune 1000 clients in the US and India, leveraging AI for a hyper-efficient trucking network.

The deal involves 952,710 shares of Singing Machine's stock and assumption of $2.6 million in liabilities. An additional 314,485 shares will be issued for SemiCab's Indian subsidiary, which generated $1.4 million in sales.

The transaction is expected to close by August 31, 2024, subject to regulatory approvals.

The Singing Machine Company (NASDAQ: MICS) has announced that its Executive Committee of the Board of Directors has authorized management to explore various strategic and corporate transactions to enhance shareholder value. These transactions could expand the company's business model beyond its core karaoke products to include disruptive software solutions and sustainability-centric technologies.

Potential strategies include reverse mergers, acquisitions, and mergers of equals. CEO Gary Atkinson emphasized the company's focus on long-term value through gamification, software-based karaoke subscriptions, and automotive karaoke. The initiative aims to address the company's struggle to maintain shareholder value since its NASDAQ uplisting.

The Singing Machine Company (NASDAQ: MICS) announced its Q1 2024 financial results, reporting a net sales decline to approximately $2.43 million, a 29% drop from Q1 2023. Gross profits fell by 39% to $0.50 million, with gross margins decreasing from 24.2% to 20.7% due to outsourced logistics costs. Operating expenses dropped to $2.79 million, with selling expenses decreasing and G&A expenses remaining flat. The company reported a net loss of $2.37 million, a $0.62 million improvement YoY. Strategic financial initiatives include improving product sales mix, reducing fixed overhead, and strict cost control, aimed at optimizing profitability moving forward.

The Singing Machine Company, Inc. reported $29.2 million in sales for the nine-month transition period ended December 31, 2023, with a focus on higher-end products and music subscription sales. Despite challenges in the retail environment, the company aims to drive growth and profitability by emphasizing higher-margin offerings and strategic partnerships. Net sales decreased by 18.7% compared to the previous year, with gross profit margins improving to 27.4% excluding a non-cash inventory impairment. Operating expenses increased primarily due to one-time expenses, leading to a net loss of $6.4 million for the period.

Singing Machine Company, Inc. (NASDAQ: MICS) secures a $2 million senior credit facility with Oxford Commercial Finance to support working capital needs. The credit facility has a 2-year term and aims to fund accounts receivable from ongoing sales, expanding financing options for the company.

Singing Machine Company, Inc. expands its presence into the China market through an exclusive license agreement with Zhuhai Fullwing Electronic Co., to market and distribute its karaoke products. The move aims to capitalize on Chinese consumers' interest in US brands known for quality and innovation.

The Singing Machine Company, Inc. reported a significant increase in sales, with their karaoke subscription service generating $3.28 million in gross sales in 2023, marking a 34.8% rise from the previous year. The partnership with Stingray Group, Inc. has been instrumental in this success, with the Company's profit share calculated at a 100% gross margin after deducting costs of goods sold and expenses.