Evolution to Focus on Hospitality and Related Markets, Steady Product Revenue, Customer Growth and Expanding Leadership Team
Exits FY25 with Strong Cash Position to Accelerate AI Platform and Products and New Corporate Initiatives
Financial Highlights
- Net revenue increased 33% to
$0.8 million in Q4 2025, as compared to$0.6 million in Q4 2024. - Gross margin improved to 57.7% in Q4 2025, as compared to 23.3% in Q4 2024, a 3,443 basis point improvement.
- Net loss improved to
$2.1 million in Q4 2025, as compared to a net loss of$2.6 million in the previous year period. - Net loss per basic and diluted share was (
$0.11 ) in Q4 2025, as compared to ($0.15 ) per basic and diluted share in Q4 2024. - FY 2025 net revenue decreased to
$2.6 million from$3.2 million in FY 2024. - FY 2025 gross margin increased 500 basis points to 50.6%, as compared to 45.6% in the prior year period.
- FY 2025 net loss was
$11.4 million , or ($0.57 ) per basic and diluted share, compared to a net loss of$10.3 million , or ($0.94 ) per basic and diluted share in FY 2024. - Net cash used in operations decreased to
$12.5 million for the year endedDecember 31, 2025 , as compared to$13.3 million for the previous year period. - Cash and cash equivalents totaled
$100.6 million as ofDecember 31, 2025 .
Recent Business Highlights
- Introduced two hospitality specific products, one for luxury brands and the other for full-service independent property owners, which provide solutions for developing modular, native mobile apps, with cloud-driven updates and a range of solutions for enhancing on-property guest experiences and engagements and ancillary revenue growth.
- Launched a redesigned corporate website and a refined portfolio of products for enhancing hospitality guest-related experiences, engagements and revenues.
- Continued investment in artificial intelligence (“AI”) to employ and integrate within our internal systems and product and services offerings.
- Continued development and release of our AI Concierge product, which is designed to personalize customer guest journeys through real-time wayfinding, Q&A and on-property recommendations.
- Announced election of
Ed Lu to the Board of Directors, bringing financial, strategic and operational leadership experience to guide the Company's finance and technology strategy and customer initiatives. - Appointed
Elliot Han , a director of the Company since 2024 with experience in corporate finance and investments in digital asset companies, as Chairperson of the Board of Directors. - Appointed
Jeremy Krol , our Interim CEO, to the Board of Directors.
Management Commentary
“The decrease of approximately
"We recently introduced two hospitality-specific product tiers designed to align our platform with the distinct needs of different property segments. Our Luxury Engagement tier is built for premium hospitality brands. It delivers fully personalized digital guest experiences anchored by
"We continue to invest in artificial intelligence across our internal operations and products. We note that IDC, a leading market intelligence provider, estimates that 50% of AI budgets in hospitality and travel will be allocated to guest personalization efforts by 2030, powering ambient intelligence and preference anticipation to increase guest satisfaction, and we intend to capitalize on that trend. Our AI Concierge, a generative AI module embedded within our mobile applications, serves as a conversational, human-like interface that enhances guest engagement and creates new monetization opportunities for our hospitality customers. Unlike conventional chatbot solutions, the AI Concierge is deeply integrated with
"We recognize that hospitality brands are built on trust and we are taking a deliberate, collaborative approach on AI development for our products. Rather than deploying simple generative AI features at scale, we are working closely with our customers to develop agentic and predictive guest-focused AI solutions tailored to their immediate operational needs while progressively building more robust language models trained on increasingly complete guest behavior, location intelligence and property data. We believe this measured approach of combining near-term commercial value with longer-term data and model enterprise value and maturity positions us to deliver AI guest experience capabilities that luxury brands and independent property operators can deploy with confidence and their guests will actually use, which in our view is ultimately the threshold that separates AI as a strategic asset from AI as a marketing line item in this vertical. Beyond hospitality, we continue to serve healthcare customers where our wayfinding and mobile engagement capabilities address similar on-property navigation and patient experience challenges, and we see meaningful opportunity to extend our AI-enabled products into that vertical as it matures.
"Looking ahead, we remain deeply committed to executing our transformative approach within the hospitality industry, driving ancillary revenue growth while enhancing guest experiences through smart digital engagement. The hospitality industry is entering a new phase where technology, and AI in particular, is no longer simply an add-on feature, but is evolving to become the core infrastructure for maximizing guest experience and property value, unlocking customer operational efficiencies and revenues and delivering personalized guest experiences at scale. Our continued investment in AI, grounded in real product integration and close customer collaboration, is central to that vision.
"Operationally, we are expanding business and sales initiatives, including new sales and marketing personnel to accelerate momentum for our existing products and drive adoption of our AI Concierge and future AI-enabled capabilities. With approximately
Note about Non-GAAP Financial Measures
A non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with accounting principles generally accepted in
In addition to financial results presented in accordance with GAAP, this press release presents adjusted EBITDA, which is a non-GAAP measure. Adjusted EBITDA is determined by taking net loss and adding interest expense (income), income tax expense, depreciation, and further adjusted for non-cash impairment, valuation adjustments and stock-based compensation expense. The company believes that this non-GAAP measure, viewed in addition to and not in lieu of net loss, provides additional information to investors by providing a more focused measure of operating results. This metric is an integral part of the Company’s internal reporting to evaluate its operations and the performance of senior management. A reconciliation of adjusted EBITDA to net loss, the most comparable GAAP measure, is available in the accompanying financial tables below. The non-GAAP measure presented herein may not be comparable to similarly titled measures presented by other companies.
| US-GAAP NET LOSS TO ADJUSTED EBITDA RECONCILIATION | ||||||||
| Year Ended | ||||||||
| (in thousands) | 2025 | 2024 | ||||||
| Net loss | $ | (11,401 | ) | $ | (10,316 | ) | ||
| Add back: Depreciation | 13 | 16 | ||||||
| Add back: Interest expense | 32 | 135 | ||||||
| Less: Interest income | (4,268 | ) | (1,732 | ) | ||||
| Add back: Income tax (benefit) expense | (19 | ) | 41 | |||||
| EBITDA | (15,643 | ) | (11,856 | ) | ||||
| Add back: Stock-based compensation | 455 | 1,656 | ||||||
| Less: Gain on extinguishment of debt | - | (535 | ) | |||||
| Add back: Loss on disposal of subsidiary | - | 418 | ||||||
| Less: Gain on legal settlement | (959 | ) | - | |||||
| Adjusted EBITDA | $ | (16,147 | ) | $ | (10,317 | ) | ||
About
Phunware’s mission is to achieve unparalleled connectivity and monetization through the widespread adoption of
For more information on
Safe Harbor / Forward-Looking Statements
This press release includes forward-looking statements. All statements other than statements of historical facts contained in this press release, including statements regarding our future results of operations and financial position, business strategy and plans, and our objectives for future operations, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” and similar expressions are intended to identify forward-looking statements. For example,
The forward-looking statements contained in this press release are based on our current expectations and beliefs concerning future developments and their potential effects on us. These forward-looking statements involve risks, uncertainties, and other assumptions that may cause actual results to differ materially from those expressed or implied. These risks and uncertainties include, but are not limited to, those factors described under the heading “Risk Factors” in our filings with the
By their nature, forward-looking statements involve risks and uncertainties. We caution you that forward-looking statements are not guarantees of future performance and that our actual results may differ materially from those expressed or implied by these forward-looking statements.
Investor Relations Contact:
949-491-8235
PHUN@mzgroup.us
www.mzgroup.us
Consolidated Balance Sheets (In thousands, except share and per share information) | ||||||||
| 2025 | 2024 | |||||||
| Assets: | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 100,587 | $ | 112,974 | ||||
| Accounts receivable, net of allowance for credit losses of | 300 | 276 | ||||||
| Digital currencies | 96 | 103 | ||||||
| Prepaid expenses and other current assets | 19,164 | 406 | ||||||
| Total current assets | 120,147 | 113,759 | ||||||
| Non-current assets: | ||||||||
| Property and equipment, net | 11 | 24 | ||||||
| Right-of-use asset, net | 552 | 840 | ||||||
| Other assets | 158 | 158 | ||||||
| Total non-current assets | 721 | 1,022 | ||||||
| Total assets | $ | 120,868 | $ | 114,781 | ||||
| Liabilities and stockholders' equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 1,070 | $ | 3,754 | ||||
| Accrued expenses | 19,905 | 148 | ||||||
| Deferred revenue | 1,386 | 1,034 | ||||||
| Lease liability | 342 | 313 | ||||||
| PhunCoin subscription payable | 1,202 | 1,202 | ||||||
| Total current liabilities | 23,905 | 6,451 | ||||||
| Deferred revenue | 369 | 528 | ||||||
| Lease liability | 277 | 619 | ||||||
| Total noncurrent liabilities | 646 | 1,147 | ||||||
| Total liabilities | 24,551 | 7,598 | ||||||
| Commitments and contingencies (See Note 7) | - | - | ||||||
| Stockholders' equity | ||||||||
| Common stock, | 2 | 2 | ||||||
| (502 | ) | (502 | ) | |||||
| Additional paid-in capital | 421,538 | 421,003 | ||||||
| Accumulated deficit | (324,721 | ) | (313,320 | ) | ||||
| Total stockholders' equity | 96,317 | 107,183 | ||||||
| Total liabilities and stockholders' equity | $ | 120,868 | $ | 114,781 | ||||
Consolidated Statements of Operations and Comprehensive Loss (In thousands, except share and per share information) | ||||||||
| Year Ended | ||||||||
| 2025 | 2024 | |||||||
| Net revenue | $ | 2,553 | $ | 3,189 | ||||
| Cost of revenue | 1,262 | 1,735 | ||||||
| Gross profit | 1,291 | 1,454 | ||||||
| Operating expenses: | ||||||||
| Sales and marketing | 3,352 | 2,605 | ||||||
| General and administrative | 15,295 | 10,473 | ||||||
| Research and development | 3,163 | 2,265 | ||||||
| Total operating expenses | 21,810 | 15,343 | ||||||
| Operating loss | (20,519 | ) | (13,889 | ) | ||||
| Other income (expense): | ||||||||
| Interest expense | (32 | ) | (135 | ) | ||||
| Interest income | 4,268 | 1,732 | ||||||
| Gain on extinguishment of debt | - | 535 | ||||||
| Other income, net | 4,863 | 1,482 | ||||||
| Total other income | 9,099 | 3,614 | ||||||
| Loss before taxes | (11,420 | ) | (10,275 | ) | ||||
| Income tax benefit (expense) | 19 | (41 | ) | |||||
| Net loss | (11,401 | ) | (10,316 | ) | ||||
| Net loss per share, basic and diluted | $ | (0.57 | ) | $ | (0.94 | ) | ||
| Weighted-average shares used to compute net loss per share, basic and diluted | 20,177,806 | 10,972,163 | ||||||
Consolidated Statements of Cash Flows (In thousands) | ||||||||
| Year Ended | ||||||||
| 2025 | 2024 | |||||||
| Operating activities | ||||||||
| Net loss | $ | (11,401 | ) | $ | (10,316 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Gain on extinguishment of debt | - | (535 | ) | |||||
| Non-cash writeoff of accounts payable | (201 | ) | (1,403 | ) | ||||
| Stock-based compensation | 455 | 1,656 | ||||||
| Other adjustments | (607 | ) | 1,219 | |||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | (21 | ) | 130 | |||||
| Prepaid expenses and other assets | (258 | ) | 86 | |||||
| Accounts payable and accrued expenses | (267 | ) | (2,933 | ) | ||||
| Lease liability payments | (360 | ) | (682 | ) | ||||
| Deferred revenue | 193 | (347 | ) | |||||
| Net cash used in operating activities from continued operations | (12,467 | ) | (13,125 | ) | ||||
| Net cash used in operating activities from discontinued operations | - | (177 | ) | |||||
| Net cash used in operating activities | (12,467 | ) | (13,302 | ) | ||||
| Investing activities | ||||||||
| Net cash for investing activities | - | - | ||||||
| Financing activities | ||||||||
| Proceeds from sales of common stock, net of issuance costs | 80 | 122,342 | ||||||
| Net cash provided by financing activities | 80 | 122,342 | ||||||
| Net (decrease) increase in cash and cash equivalents | (12,387 | ) | 109,040 | |||||
| Cash and cash equivalents at the beginning of the period | 112,974 | 3,934 | ||||||
| Cash and cash equivalents at the end of the period | $ | 100,587 | $ | 112,974 | ||||
| Supplemental disclosure of cash flow information | ||||||||
| Interest paid | $ | 32 | $ | 31 | ||||
| Income taxes paid | $ | 25 | $ | 14 | ||||
| Supplemental disclosures of non-cash financing activities: | ||||||||
| Issuance of common stock upon conversion of the 2022 Promissory Note | $ | - | $ | 4,505 | ||||
| Issuance of common stock for payment of bonuses and consulting fees | $ | - | $ | 35 | ||||
