Jet.AI Reports First Quarter 2024 Financial Results
- Increase in total revenues of 105% year-over-year
- 17% point increase in net margin, adjusted for stock option expense
- Cash and cash equivalents of $2.1 million as of April 1st, unchanged from December 31st, 2023
LAS VEGAS, May 15, 2024 (GLOBE NEWSWIRE) — Jet.AI Inc. (the “Company”) (Nasdaq: JTAI), an innovative private aviation and artificial intelligence (“AI”) company, today announced financial results for the first quarter ended March 31, 2024.
First Quarter 2024 and Recent Operational Highlights
- Released the National Jet Card Program using third party aircraft
- Announced partnership with FL3XX to integrate its DynoFlight carbon removal platform making it an easy option for thousands of FL3XX customers
- Launched Reroute AI, a web-based software tool designed to transform the way empty flight legs are utilized
- As previously disclosed, raised a $16.5 million convertible preferred from Ionic Ventures LLC
- Added a King Air 350i to its managed fleet
First Quarter 2024 Financial Results
Revenues were $3.8 million, an increase of $1.9 million compared to the same period last year. The primary reason for this increase was due to significant increases in Software App and Management and Other Services revenue.
Software App and Cirrus Aviation Charter Revenue, the gross amount of charters booked through CharterGPT and Cirrus Aviation, was $2.4 million compared to $1.0 million in the same period last year. The increase primarily reflects increased utilization of the Company’s Citation CJ4 managed aircraft during the first quarter of 2024 compared to 2023 as well as more than a 200% increase in bookings through the CharterGPT app.
Management and Other Services revenue, which is comprised of revenues generated from managing and chartering our customer aircrafts, totaled $800,000 compared to $334,000 in the same period last year.
Jet Card and Fractional Programs revenue, which is generated from the sale and use of jet cards and service revenue related to ongoing utilization by the Company’s fractional customers, totaled $677,000 compared to $548,000 in the same period last year.
Cost of revenues totaled $4.0 million compared to $2.0 million in the same period last year. The increase is primarily due to an increase in fleet utilization, third-party charter costs, and merchant fees and federal excise tax relating to charter flights.
Operating expenses excluding stock option expense totaled $1.8 million compared to $1.2 million in the same period last year. The increase was primarily due to increased sales and marketing expenses. Option expense in the period related to amortization of prior period grants.
Operating loss was approximately $3.1 million compared to $2.7 million in the same period last year. The increase was primarily due to increased professional services expense and D&O insurance costs as a result of being public.
Cash and cash equivalents including gross proceeds from the release of a tranche of a convertible preferred with Ionic Ventures, LLC was approximately $2.1 million as of April 1st, 2024, unchanged when compared to $2.1 million as of December 31, 2023. Cash and cash equivalents of approximately $0.6 million at March 31st, 2024 rose to $2.1 million the next day on April 1st as a Subscription Receivable attributable to the Ionic private placement was collected and booked to Cash.
Management Commentary
“Last quarter we doubled sales year over year and substantially improved bottom line margin, up 17% points adjusted for option expense. In addition, we closed on the $16.5 million sale of convertible preferred shares to Ionic Ventures LLC, with the goal of positioning the company well financially for the foreseeable future,” said Mike Winston, Executive Chairman and Founder of Jet.AI. “On the software side, we launched Reroute AI for operators and did a key integration deal for DynoFlight with a major software provider to the private jet industry (FL3XX). Challenger 3500 fleet financing conversations remain ongoing.
“Looking ahead, we just announced a national jet card program that allows Jet.AI to address hundreds of millions of dollars of market potential with little or no incremental capital outlay. In our regional jet card program, we’re limited by the number of planes we control and their range, with the national program we don’t have those limitations because we use off-fleet jets from safety vetted operators. That frees us to use our regional jet card sales and management capability on a larger scale. In addition, next week we expect to launch a new version of Reroute AI geared toward the tens of thousands of charter brokers who routinely search for value on behalf of their customers. Overall, we’re headed in the right direction and staying disciplined.”
About Jet.AI
Jet.AI operates in two segments, Software and Aviation, respectively. The Software segment features the B2C CharterGPT app and the B2B Jet.AI Operator platform. The CharterGPT app uses natural language processing and machine learning to improve the private jet booking experience. The Jet.AI operator platform offers a suite of stand-alone software products to enable FAA Part 135 charter providers to add revenue, maximize efficiency, and reduce environmental impact. The Aviation segment features jet aircraft share ownership, jet card, on-fleet charter, management, and buyer’s brokerage. Jet.AI is an official partner of the Las Vegas Golden Knights, 2023 NHL Stanley Cup® champions. The Company was founded in 2018 and is based in Las Vegas, NV and San Francisco, CA.
Forward-Looking Statements
This press release contains certain forward-looking statements within the meaning of the federal securities laws with respect to the products and services offered by Jet.AI and the markets in which it operates, and Jet.AI’s projected future results. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties that could cause the actual results to differ materially from the expected results. As a result, caution must be exercised in relying on forward-looking statements, which speak only as of the date they were made. Factors that could cause actual results to differ materially from those expressed or implied in forward-looking statements can be found in the Registration Statement and the amendments thereto on Form S-4 filed with the Securities and Exchange Commission (File No. 333-270848) and other documents filed by the Company from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Readers are cautioned not to put undue reliance on forward-looking statements, and Jet.AI assumes no obligation and does not intend to update or revise these forward-looking statements, whether because of new information, future events, or otherwise.
Jet.AI Investor Relations:
Gateway Group, Inc.
949-574-3860
Jet.AI@gateway-grp.com
| JET.AI, INC. CONSOLIDATED BALANCE SHEETS |
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| March 31, 2024 |
December 31, 2023 |
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| (unaudited) | ||||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 595,555 | $ | 2,100,543 | ||||
| Accounts receivable | 162,962 | 96,539 | ||||||
| Other current assets | 104,657 | 190,071 | ||||||
| Prepaid offering costs | 800,000 | 800,000 | ||||||
| Subscription receivable | 1,500,025 | – | ||||||
| Total current assets | 3,163,199 | 3,187,153 | ||||||
| Property and equipment, net | 6,967 | 7,604 | ||||||
| Intangible assets, net | 53,577 | 73,831 | ||||||
| Right-of-use lease asset | 1,442,884 | 1,572,489 | ||||||
| Investment in joint venture | 100,000 | 100,000 | ||||||
| Deposits and other assets | 798,111 | 798,111 | ||||||
| Total assets | $ | 5,564,738 | $ | 5,739,188 | ||||
| Liabilities and Stockholders’ Deficit | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 1,386,436 | $ | 1,656,965 | ||||
| Accrued liabilities | 2,444,004 | 2,417,115 | ||||||
| Deferred revenue | 1,395,285 | 1,779,794 | ||||||
| Operating lease liability | 513,869 | 510,034 | ||||||
| Note payable | – | 321,843 | ||||||
| Notes payable – related party | – | 266,146 | ||||||
| Total current liabilities | 5,739,594 | 6,951,897 | ||||||
| Lease liability, net of current portion | 891,415 | 1,021,330 | ||||||
| Redeemable preferred stock | 1,702,000 | 1,702,000 | ||||||
| Total liabilities | 8,333,009 | 9,675,227 | ||||||
| Commitments and contingencies (Note 2 and 5) | – | – | ||||||
| Stockholders’ Deficit | ||||||||
| Preferred Stock, 4,000,000 shares authorized, par value $0.0001, 0 issued and outstanding | – | – | ||||||
| Series B Convertible Preferred Stock, 5,000 shares authorized, par value $0.0001, 150 and 0 issued and outstanding, respectively | – | – | ||||||
| Common stock, 55,000,000 shares authorized, par value $0.0001, 12,555,144 and 9,754,364 issued and outstanding, respectively | 1,255 | 975 | ||||||
| Subscription receivable | (6,724 | ) | (6,724 | ) | ||||
| Additional paid-in capital | 39,738,635 | 35,342,098 | ||||||
| Accumulated deficit | (42,501,437 | ) | (39,272,388 | ) | ||||
| Total stockholders’ deficit | (2,768,271 | ) | (3,936,039 | ) | ||||
| Total liabilities and stockholders’ deficit | $ | 5,564,738 | $ | 5,739,188 | ||||
| JET.AI, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) |
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| Three Months Ended | ||||||||
| March 31, | ||||||||
| 2024 | 2023 | |||||||
| Revenues | $ | 3,848,598 | $ | 1,875,508 | ||||
| Cost of revenues | 3,972,954 | 1,950,526 | ||||||
| Gross loss | (124,356 | ) | (75,018 | ) | ||||
| Operating Expenses: | ||||||||
| General and administrative (including stock-based compensation of $1,199,318 and $1,407,044, respectively) | 2,546,294 | 2,488,018 | ||||||
| Sales and marketing | 446,600 | 120,167 | ||||||
| Research and development | 32,546 | 36,319 | ||||||
| Total operating expenses | 3,025,440 | 2,644,504 | ||||||
| Operating loss | (3,149,796 | ) | (2,719,522 | ) | ||||
| Other expense (income): | ||||||||
| Interest expense | 79,314 | – | ||||||
| Other income | (61 | ) | – | |||||
| Total other expense | 79,253 | – | ||||||
| Loss before provision for income taxes | (3,229,049 | ) | (2,719,522 | ) | ||||
| Provision for income taxes | – | – | ||||||
| Net Loss | $ | (3,229,049 | ) | $ | (2,719,522 | ) | ||
| Less cumulative preferred stock dividends | 29,728 | – | ||||||
| Net Loss to common stockholders | $ | (3,258,777 | ) | $ | (2,719,522 | ) | ||
| Weighted average shares outstanding – basic and diluted | 11,441,443 | 3,902,489 | ||||||
| Net loss per share – basic and diluted | $ | (0.28 | ) | $ | (0.70 | ) | ||
| JET.AI, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) |
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| Three Months Ended | ||||||||
| March 31, | ||||||||
| 2024 | 2023 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net loss | $ | (3,229,049 | ) | $ | (2,719,522 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Amortization and depreciation | 33,813 | 33,596 | ||||||
| Amortization of debt discount | 80,761 | – | ||||||
| Stock-based compensation | 1,199,318 | 1,407,044 | ||||||
| Non-cash operating lease costs | 129,605 | 125,884 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | (66,423 | ) | – | |||||
| Other current assets | 85,414 | (98,571 | ) | |||||
| Accounts payable | (270,529 | ) | 22,105 | |||||
| Accrued liabilities | 26,889 | (192,625 | ) | |||||
| Deferred revenue | (384,509 | ) | 352,401 | |||||
| Operating lease liability | (126,080 | ) | (122,359 | ) | ||||
| Net cash used in operating activities | (2,520,790 | ) | (1,192,047 | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Purchase of property and equipment | – | (4,339 | ) | |||||
| Purchase of intangible assets | (12,922 | ) | (4,294 | ) | ||||
| Investment in joint venture | – | (100,000 | ) | |||||
| Deposits and other assets | – | 15,000 | ||||||
| Net cash used in investing activities | (12,922 | ) | (93,633 | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Repayments – notes payable | (371,250 | ) | – | |||||
| Repayments – related party notes payable | (297,500 | ) | – | |||||
| Offering costs | (155,000 | ) | (436,969 | ) | ||||
| Exercise of warrants | 742,474 | – | ||||||
| Proceeds from sale of Common Stock | 1,110,000 | 1,588,695 | ||||||
| Net cash provided by financing activities | 1,028,724 | 1,151,726 | ||||||
| Decrease in cash and cash equivalents | (1,504,988 | ) | (133,954 | ) | ||||
| Cash and cash equivalents, beginning of period | 2,100,543 | 1,527,391 | ||||||
| Cash and cash equivalents, end of period | $ | 595,555 | $ | 1,393,437 | ||||
| Supplemental disclosures of cash flow information: | ||||||||
| Cash paid for interest | $ | 79,314 | $ | – | ||||
| Cash paid for income taxes | $ | – | $ | – | ||||
| Non cash financing activities: | ||||||||
| Subscription receivable from sale of common and preferred stock | $ | 1,500,025 | $ | 9,935 | ||||
