Profitability Roadmap: Efficiency and Discipline
SHANGHAI, May 16, 2025 /PRNewswire/ — Xiao-I Corporation (“Xiao-I” or the “Company”) (NASDAQ: AIXI), a global leader in artificial intelligence solutions, today announced selected audited financial results for the year 2024, highlighting approximately $70.31 million in revenue, representing a 18.8% year-over-year growth, a gross profit margin (GPM) improvement of 2 percentage points, and a significant narrowing of net loss to $14.55 million. These results position the Company to achieve profitability in 2025.
Key Financial Highlights
– Revenue Growth: revenue for 2024 reached approximately $70.31 million, up 18.8% year-over-year, driven by surging demand for its Hua Zang LLM – powered Model-as-a-Service (MaaS) solutions and breakthrough AI hardware sales.
– Gross Profit: Gross profit increased from $39,423,570 in 2023 to $48,049,547 in 2024, representing a growth rate of approximately 21.9%.
– Margin Expansion: Gross profit margin improved to 68.3%, compared to 66.6% in 2023, reflecting operational leverage from MaaS commercialization and cost-optimized deployment.
– R&D Expenses: Research and development expenses totaled $34.66 million, down from $52.39 million in 2023. The 33.8% reduction reflects improved efficiency and the productization of core technologies.
– Net Loss Reduction: Net loss narrowed significantly to $14.55 million in 2024, down 46.1% from $27.01 million in 2023, underscoring disciplined cost management and revenue scalability.
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 90% domestic operational anchoring, MaaS model’s tariff-agnostic nature provides partial insulation, while AI-driven G&A optimization below 15% of revenue enhances risk absorption capacity. Management remains committed to disciplined execution across these vectors to achieve 2025 profitability targets.”
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
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XIAO-I CORPORATION CONSOLIDATED BALANCE SHEETS (In U.S. dollars, except for share and per share data, or otherwise noted) |
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As of December 31, |
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|
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 $0.00005 per share; 1,000,000,000 shares |
$ |
1,201 |
$ |
1,598 |
||||
|
Preferred shares (par value of $0.00005 per share; 3,700,000 preferred |
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 |
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XIAO-I CORPORATION |
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For the years ended December 31, |
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|
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 |
|||||||||