Smartkem Reports First Quarter 2025 Financial Results
- First revenue generation with $23,000 in Q1 2025 from TRUFLEX® materials sales
- Strategic partnerships secured with AUO, Chip Foundation, and RiTdisplay Corporation
- Introduction of new MiP4 platform for MicroLED Smart Backlight technology
- Operating losses increased to $3.1 million, up from $2.4 million YoY
- Cash position declined significantly from $7.1M to $3.9M in one quarter
- Operating expenses increased by 26% YoY to $3.4 million
Insights
Smartkem shows initial commercialization progress with partnerships and first revenue, but concerning cash burn threatens sustainability without additional funding.
Smartkem's Q1 2025 results reveal mixed signals in their journey to commercialize organic transistor technology. The company achieved its first-ever revenue of
Their cash position declined dramatically from
On the positive side, Smartkem has made tangible commercial progress through strategic partnerships with key industry players. The collaboration with AUO on rollable transparent MicroLED displays, initial material sales to Chip Foundation, and the MOU with RiTdisplay for OTFT integration on their Gen2.5 line represent validation from established industry participants. The debut of their "MiP4" platform at Touch Taiwan demonstrates technical progress in their LCD backlight technology targeted at automotive applications.
What's particularly noteworthy is Smartkem's strategic positioning in the emerging MicroLED display market. Their organic transistor technology potentially offers advantages in flexibility and transparency that could differentiate displays in premium segments. However, the significant gap between their current revenue generation and substantial operating expenses indicates they remain in early commercialization stages despite these partnerships.
The combination of promising technical progress, meaningful industry partnerships, and critical financial constraints creates a challenging outlook. Without substantial revenue acceleration or additional financing, the promising technology developments may face existential challenges in the near term.
Smartkem Chairman and CEO, Ian Jenks, commented: "Progress toward commercialization continued in the first quarter of 2025. As previously announced, we commenced our project with AUO to develop the world's first rollable, transparent MicroLED display, made the first sales of our TRUFLEX® advanced semiconductor materials to Chip Foundation, and signed a memorandum of understanding with RiTdisplay Corporation for the integration of Smartkem's OTFT process on RiTdisplay's Gen2.5 line. In addition, the Company appointed Jonathan Watkins as our new COO.
"Building on our momentum in the first quarter, in April, we introduced the first application of our "MiP4" platform at Touch Taiwan 2025. This MicroLED Smart Backlight showcases how our unique semiconductor materials and chip-first architecture can unlock higher brightness and better contrast for LCDs, particularly in automotive displays.
"Tomorrow, during Display Week 2025 and as part of the associated SID Business Conference, I'll be giving a presentation titled "Changing the World of Electronics: Unveiling a Breakthrough in Transistor Technology for the Future of MicroLED Displays" that will present the latest advancements in our technology.
"I look forward to keeping you informed of our progress this year as we strengthen our position as a global leader in organic transistor technology and close in on our goal of commercializing our technology," Jenks concluded.
First Quarter 2025 Financial Highlights:
- Cash and cash equivalents were
$3.9 million $7.1 million - Revenues were
$23 thousand - Operating expenses were
$3.4 million $2.7 million - Loss from operations was
$3.1 million $2.4 million
About Smartkem
Smartkem is seeking to change the world of electronics with a new class of transistors developed using its proprietary advanced semiconductor materials. Our TRUFLEX® materials can be used in a range of applications including next generation MicroLED, LCD and AMOLED displays, as well as advanced computer and AI chip packaging, and a new type of sensor.
Smartkem's MiP4 is designed to replace existing MiniLED packages in LCD backlights and signage applications. The MiP4 will offer higher brightness at lower power, lower production costs, and compatibility with existing MiniLED die bonding equipment. MiP4s are expected to ship -on-blue tape format for seamless industry adoption.
For MicroLED display applications, Smartkem's low temperature process allows its liquid transistors to be poured directly onto MicroLEDs, eliminating the need to use current high-cost, low-yield manufacturing processes. This innovation is expected to reduce defects and enhance yield, and to integrate seamlessly into existing manufacturing infrastructure, with the potential to make MicroLED displays more commercially viable across a number of sectors including smartphones, wearables, automotives and digital signage.
Smartkem designs and develops its materials at its research and development facility in
The company has an extensive IP portfolio including 138 granted patents across 17 patent families, 16 pending patents and 40 codified trade secrets. For more information, visit our website or follow us on LinkedIn.
Forward-Looking Statements
All statements in this press release that are not historical are forward-looking statements, including, among other things, its market position and market opportunity, expectations and plans as to its product development, manufacturing and sales, and relations with its partners and investors. These statements are not historical facts but rather are based on Smartkem, Inc.'s current expectations, estimates, and projections regarding its business, operations and other similar or related factors. Words such as "may," "will," "could," "would," "should," "anticipate," "predict," "potential," "continue," "expect," "intend," "plan," "project," "believe," "estimate," and other similar or elated expressions are used to identify these forward-looking statements, although not all forward-looking statements contain these words. You should not place undue reliance on forward-looking statements because they involve known and unknown risks, uncertainties, and assumptions that are difficult or impossible to predict and, in some cases, beyond the Company's control. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described in the Company's filings with the Securities and Exchange Commission. The Company undertakes no obligation to revise or update information in this release to reflect events or circumstances in the future, even if new information becomes available.
Industry Representatives and Media
Selena Kirkwood
Head of Communications for Smartkem
T: +44 (0) 7971 460 364
s.kirkwood@smartkem.com
Analysts and Investors
David Barnard, CFA
Alliance Advisors Investor Relations
T: 1 415 433 3777
dbarnard@allianceadvisors.com
SMARTKEM, INC. AND SUBSIDIARIES | ||||||
Consolidated Balance Sheets | ||||||
(Unaudited) | ||||||
(in thousands, except number of shares and per share data) | ||||||
March 31, | December 31, | |||||
2025 | 2024 | |||||
Assets | ||||||
Current assets | ||||||
Cash and cash equivalents | $ | 3,881 | $ | 7,141 | ||
Research and development tax credit receivable | 664 | 519 | ||||
Prepaid expenses and other current assets | 1,091 | 849 | ||||
Total current assets | 5,636 | 8,509 | ||||
Property, plant and equipment, net | 220 | 269 | ||||
Right-of-use assets, net | 54 | 120 | ||||
Other assets, non-current | — | 6 | ||||
Total assets | $ | 5,910 | $ | 8,904 | ||
Liabilities and stockholders' equity | ||||||
Current liabilities | ||||||
Accounts payable and accrued expenses | $ | 1,439 | $ | 1,791 | ||
Lease liabilities, current | 24 | 47 | ||||
Other current liabilities | 639 | 450 | ||||
Total current liabilities | 2,102 | 2,288 | ||||
Lease liabilities, non-current | 21 | 25 | ||||
Total liabilities | 2,123 | 2,313 | ||||
Commitments and contingencies (Note 7) | — | — | ||||
Stockholders' equity: | ||||||
Preferred stock, par value | — | — | ||||
Common stock, par value | — | — | ||||
Additional paid-in capital | 122,651 | 122,316 | ||||
Accumulated other comprehensive loss | (2,110) | (1,105) | ||||
Accumulated deficit | (116,754) | (114,620) | ||||
Total stockholders' equity | 3,787 | 6,591 | ||||
Total liabilities and stockholders' equity | $ | 5,910 | $ | 8,904 | ||
SMARTKEM, INC. AND SUBSIDIARIES | ||||||
Consolidated Statements of Operations and Comprehensive Loss | ||||||
(Unaudited) | ||||||
(in thousands, except number of shares and per share data) | ||||||
Three Months Ended March 31, | ||||||
2025 | 2024 | |||||
Revenue | $ | 23 | $ | — | ||
Cost of revenue | 1 | — | ||||
Gross profit | 22 | — | ||||
Other operating income | 251 | 202 | ||||
Operating expenses | ||||||
Research and development | 1,497 | 1,276 | ||||
General and administrative | 2,009 | 1,362 | ||||
(Gain)/loss on foreign currency transactions | (95) | 13 | ||||
Total operating expenses | 3,411 | 2,651 | ||||
Loss from operations | (3,138) | (2,449) | ||||
Non-operating income/(expense) | ||||||
Gain/(loss) on foreign currency transactions | 969 | (6) | ||||
Change in fair value of the warrant liability | — | 753 | ||||
Interest income/(expense) | 10 | 6 | ||||
Total non-operating income/(expense) | 979 | 753 | ||||
Loss before income taxes | (2,159) | (1,696) | ||||
Income tax refund | 25 | — | ||||
Net loss | $ | (2,134) | $ | (1,696) | ||
Preferred stock deemed dividends | — | (7,094) | ||||
Net loss attributed to common stockholders | $ | (2,134) | $ | (8,790) | ||
Weighted average shares outstanding - basic and diluted | 6,649,603 | 2,735,375 | ||||
Basic and diluted net loss per common share attributed to common stockholders | $ | (0.32) | $ | (3.21) | ||
Net loss | $ | (2,134) | $ | (1,696) | ||
Other comprehensive loss: | ||||||
Foreign currency translation | (1,005) | (18) | ||||
Total comprehensive loss | $ | (3,139) | $ | (1,714) | ||
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SOURCE Smartkem
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