Artificial Intelligence

PowerFleet Reports Second Quarter 2021 Financial Results

Published

3 years ago

August 5, 2021

WOODCLIFF LAKE, N.J., Aug. 05, 2021 (GLOBE NEWSWIRE) — PowerFleet, Inc. (Nasdaq: PWFL), a global leader and provider of subscription-based wireless IoT and M2M solutions for securing, controlling, tracking, and managing high-value enterprise assets, reported results for the second quarter ended June 30, 2021.

Second Quarter 2021 Financial Highlights

Total revenue was $33.5 million, a 30% increase year-over-year.
High margin, recurring and services revenue was $18.1 million, or 54% of total revenue.
At quarter end, cash and cash equivalents totaled $39.9 million and $53.3 million of working capital.

Second Quarter 2021 and Recent Operational Highlights

Launched ‘Vista’, an advanced vehicle video solution with artificial intelligence capabilities to analyze and proactively manage risky driving situations across fleets.
Entered into a reseller agreement with Mitsubishi Logisnext Americas Group (Logisnext) to introduce PowerFleet Enterprise Telematic Solution to their North American customers and dealer network.
Selected by White Oak Transportation to equip their 875-trailer fleet with PowerFleet’s LV-500 solution for better asset visibility, and operational efficiencies.
Chosen by the Israeli Police to provide technological services for more than 7,500 vehicles for the next four years.
Provided Comasco with an IoT solution for real-time tracing and inventory management of their rented crane parts.

Management Commentary

“The measurable pickup we experienced in new sales activity across our geographic regions was a key driver of the robust revenue growth we generated in the second quarter,” said Chris Wolfe, PowerFleet CEO. “The acceleration we are seeing across our end markets drove a 16% sequential increase and 30% year-over-year increase in total revenue, while our focus on building predictable revenue streams produced an 11% year-over-year increase in high margin, recurring and services revenue. Our financial performance also demonstrates the leverage in our business model, reflected by our expanding profitability metrics. Overall, our second quarter results reveal the continued execution of our long-term strategy to increase high margin recurring and services revenue by expanding our high-value solutions offerings and growing our business in our targeted markets.

“PowerFleet’s improving financial performance is a direct result of the building sales activity we’ve been seeing across our key geographic regions, which is also validated by our robust backlog and opportunity pipeline. Domestically, we secured several new wins and follow-on orders in the quarter, including adding a major North American moving company and White Oak as new customers as well as signing a major 3,000-unit follow-on order with a customer who we announced last year. Internationally, our sales momentum and customer traction were equally as robust. Our Israeli operations achieved two major milestones in Q2, including surpassing 200,000 monthly subscribers and installing 6,400 units in the month of June, which is the highest monthly installation count since the company’s inception.

“As our financial and operational performance indicate, we have entered the second half of 2021 with encouraging momentum, giving us confidence in our growth prospects. We are making meaningful progress on our financial goals and toward realizing our vision to be the leading solutions provider in the massive industrial IoT solutions space.”

Second Quarter 2021 Financial Results
Total revenue increased 30% to $33.5 million from $25.8 million in the same year-ago period.

Services revenue was $18.1 million, or 54% of total revenue, an improvement compared to $16.4 million, or 64% of total revenue, in the same year-ago period. Product revenue, which drives future services revenue, was $15.5 million, or 46% of total revenue, an improvement compared to $9.4 million, or 36% of total revenue, in the same year-ago period.

Gross profit was $16.0 million, or 48% of total revenue, compared to $14 million, or 55% of total revenue, in the same year-ago period. Service gross profit was $11.4 million, or 63% of total service revenue, compared to $10.7 million, or 65% of total service revenue, in the same year-ago period. Product gross profit was $4.6 million, or 30% of total product revenue, compared to $3.4 million, or 35% of total product revenue, in the same year-ago period.

Selling, general and administrative expenses were $13.4 million, compared to $12.2 million in the same year-ago period. Research and development expenses were $2.8 million, compared to $2.6 million in the same year-ago period.

Net loss attributable to common stockholders totaled $2.6 million, or $(0.08) per basic and diluted share (based on 34.9 million weighted average shares outstanding), compared to net loss attributable to common stockholders of $3.8 million, or $(0.13) per basic and diluted share, in the same year-ago period (based on 29.4 million weighted average shares outstanding).

Non-GAAP net income totaled $1.4 million, or $0.04 per basic and $0.03 per diluted share (based on 34.9 million weighted average basic shares outstanding and 43.1 million weighted average diluted shares outstanding), an improvement compared to non-GAAP net income of $789,000, or $0.03 per basic and $0.02 diluted share (based on 29.4 million weighted average basic shares outstanding and 36.6 million weight average diluted shares outstanding), in the same year-ago period (See the section below titled “Non-GAAP Financial Measures” for more information about non-GAAP net income and its reconciliation to GAAP net income/loss).

Adjusted EBITDA, a non-GAAP metric, totaled $2.8 million, an improvement from adjusted EBITDA of $2.1 million in the same year-ago period (See the section below titled “Non-GAAP Financial Measures” for more information about adjusted EBITDA and its reconciliation to GAAP net income/loss).

At quarter-end, the company had $39.9 million in cash and cash equivalents. The Company’s working capital position at quarter-end was $53.3 million.

Investor Conference Call
PowerFleet management will discuss these results and business outlook on a conference call today (Thursday, August 5, 2021) at 8:30 a.m. Eastern time (5:30 a.m. Pacific time).

PowerFleet management will host the presentation, followed by a question-and-answer session.

U.S. dial-in: 888-506-0062
International dial-in: 973-528-0011
Passcode: 284878

The conference call will be broadcast simultaneously and available for replay here and in the investor section of the company’s website at ir.powerfleet.com.

If you have any difficulty connecting with the conference call, please contact PowerFleet’s investor relations team at (949) 574-3860.

Non-GAAP Financial Measures
To supplement its financial statements presented in accordance with Generally Accepted Accounting Principles (GAAP), PowerFleet provides certain non-GAAP measures of financial performance. These non-GAAP measures include non-GAAP net income (loss), non-GAAP net income (loss) per basic and diluted share and adjusted EBITDA. Reference to these non-GAAP measures should be considered in addition to results prepared under current accounting standards, but are not a substitute for, or superior to, GAAP results. These non-GAAP measures are provided to enhance investors’ overall understanding of PowerFleet’s current financial performance. Specifically, PowerFleet believes the non-GAAP measures provide useful information to both management and investors by excluding certain expenses, gains and losses that may not be indicative of its core operating results and business outlook. Adjusted EBITDA is not a measure of financial performance or liquidity under GAAP and, accordingly, should not be considered as an alternate to net income or cash flow from operating activities as an indicator of operating performance or liquidity. Because PowerFleet’s method for calculating the non-GAAP measures may differ from other companies’ methods, the non-GAAP measures may not be comparable to similarly titled measures reported by other companies. Reconciliation of all non-GAAP measures included in this press release to the nearest GAAP measures can be found in the financial tables included in this press release.

PowerFleet, Inc. and Subsidiaries
Reconciliation of GAAP to Adjusted EBITDA Financial Measures
(Unaudited)




	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2020			2021			2020			2021

Net loss attributable to common stockholders	$	(3,766,000	)	$	(2,633,000	)	$	(8,315,000	)	$	(5,616,000	)
Non-controlling interest		(1,000	)		(1,000	)		(16,000	)		(1,000	)
Preferred stock dividend and accretion		1,140,000			1,196,000			2,263,000			2,392,000
Interest (income) expense, net		625,000			598,000			1,360,000			1,056,000
Other (income) expense, net		(5,000	)		2,000			(7,000	)		2,000
Income tax (benefit) expense		460,000			67,000			653,000			540,000
Depreciation and amortization		1,983,000			2,089,000			4,050,000			4,230,000
Stock-based compensation		977,000			1,096,000			2,086,000			2,193,000
Foreign currency translation		693,000			388,000			51,000			(631,000	)
Impact of the fair value mark-up of acquired inventory		(9,000	)		–			124,000			–

Adjusted EBITDA	$	2,097,000		$	2,802,000		$	2,249,000		$	4,165,000

PowerFleet, Inc. and Subsidiaries
Reconciliation of GAAP to Non-GAAP Net Income (Loss) Financial Measures
(Unaudited)




	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2020			2021			2020			2021

Net loss attributable to common stockholders	$	(3,766,000	)	$	(2,633,000	)	$	(8,315,000	)	$	(5,616,000	)
Preferred stock dividend and accretion		1,140,000			1,196,000			2,263,000			2,392,000
Other (income) expense, net		(5,000	)		2,000			(7,000	)		2,000
Intangible assets amortization expense		1,332,000			1,298,000			2,664,000			2,597,000
Stock-based compensation		977,000			1,096,000			2,086,000			2,193,000
Foreign currency translation		693,000			388,000			51,000			(631,000	)
Non-cash portion of income tax expense		427,000			21,000			615,000			492,000
Impact of the fair value mark-up of acquired inventory		(9,000	)		–			124,000			–
Non-GAAP net income (loss)	$	789,000		$	1,368,000		$	(519,000	)	$	1,429,000

Non-GAAP net income (loss) – basic	$	0.03		$	0.04		$	(0.02	)	$	0.04
Non-GAAP net income (loss) – diluted	$	0.02		$	0.03		$	(0.02	)	$	0.03
Weighted average common shares outstanding – basic		29,399,000			34,898,000			29,216,000			34,083,000
Weighted average common shares outstanding – diluted		36,583,000			43,083,000			29,216,000			42,403,000

About PowerFleet
PowerFleet® Inc. (NASDAQ: PWFL; TASE: PWFL) is a global leader and provider of subscription-based wireless IoT and M2M solutions for securing, controlling, tracking, and managing high-value enterprise assets such as industrial trucks, tractor trailers, containers, cargo, and vehicles and truck fleets. The company is headquartered in Woodcliff Lake, New Jersey, with offices located around the globe. PowerFleet’s patented technologies address the needs of organizations to monitor and analyze their assets to increase efficiency and productivity, reduce costs, and improve profitability. Our offerings are sold under the global brands PowerFleet, Pointer, and Cellocator. For more information, please visit www.powerfleet.com, the content of which does not form a part of this press release.

Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of federal securities laws. Forward-looking statements include statements with respect to PowerFleet’s beliefs, plans, goals, objectives, expectations, anticipations, assumptions, estimates, intentions, and future performance, and involve known and unknown risks, uncertainties and other factors, which may be beyond PowerFleet’s control, and which may cause its actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be forward-looking statements. For example, forward-looking statements include statements regarding prospects for additional customers; potential contract values; market forecasts; projections of earnings, revenues, synergies, accretion, or other financial information; emerging new products; and plans, strategies, and objectives of management for future operations, including growing revenue, controlling operating costs, increasing production volumes, and expanding business with core customers. The risks and uncertainties referred to above include, but are not limited to, future economic and business conditions, the ability to recognize the anticipated benefits of the acquisition of Pointer, which may be affected by, among other things, the loss of key customers or reduction in the purchase of products by any such customers, the failure of the market for PowerFleet’s products to continue to develop, the possibility that PowerFleet may not be able to integrate successfully the business, operations and employees of I.D. Systems and Pointer, the inability to protect PowerFleet’s intellectual property, the inability to manage growth, the effects of competition from a variety of local, regional, national and other providers of wireless solutions, and other risks detailed from time to time in PowerFleet’s filings with the Securities and Exchange Commission, including PowerFleet’s annual report on Form 10-K for the year ended December 31, 2020. These risks could cause actual results to differ materially from those expressed in any forward-looking statements made by, or on behalf of, PowerFleet. Unless otherwise required by applicable law, PowerFleet assumes no obligation to update the information contained in this press release, and expressly disclaims any obligation to do so, whether a result of new information, future events, or otherwise.

PowerFleet Company Contact
Ned Mavrommatis, CFO
[email protected]
(201) 996-9000

PowerFleet Investor Contact
Matt Glover
Gateway Investor Relations
[email protected]
(949) 574-3860

PowerFleet, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations Data

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2020			2021			2020			2021
	(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)
Revenue:
Products	$	9,394,000		$	15,466,000		$	22,602,000		$	26,886,000
Services		16,371,000			18,082,000			33,962,000			35,653,000

		25,765,000			33,548,000			56,564,000			62,539,000
Cost of revenue:
Cost of products		6,023,000			10,862,000			15,325,000			19,014,000
Cost of services		5,699,000			6,641,000			12,330,000			13,010,000

		11,722,000			17,503,000			27,655,000			32,024,000

Gross Profit		14,043,000			16,045,000			28,909,000			30,515,000

Operating expenses:
Selling, general and administrative expenses		12,166,000			13,421,000			27,269,000			27,029,000
Research and development expenses		2,582,000			2,779,000			5,754,000			5,524,000

		14,748,000			16,200,000			33,023,000			32,553,000

Loss from operations		(705,000	)		(155,000	)		(4,114,000	)		(2,038,000	)
Interest income		17,000			12,000			31,000			24,000
Interest expense		(679,000	)		(611,000	)		(1,429,000	)		(1,081,000	)
Foreign currency translation of debt		(805,000	)		(615,000	)		90,000			412,000
Other (expense) income, net		5,000			(2,000	)		7,000			(2,000	)

Net loss before income taxes		(2,167,000	)		(1,371,000	)		(5,415,000	)		(2,685,000	)

Income tax benefit (expense)		(460,000	)		(67,000	)		(653,000	)		(540,000	)

Net loss before non-controlling interest		(2,627,000	)		(1,438,000	)		(6,068,000	)		(3,225,000	)
Non-controlling interest		1,000			1,000			16,000			1,000

Net loss		(2,626,000	)		(1,437,000	)		(6,052,000	)		(3,224,000	)
Accretion of preferred stock		(168,000	)		(168,000	)		(336,000	)		(336,000	)
Preferred stock dividend		(972,000	)		(1,028,000	)		(1,927,000	)		(2,056,000	)

Net loss attributable to common stockholders	$	(3,766,000	)	$	(2,633,000	)	$	(8,315,000	)	$	(5,616,000	)

Net loss per share – basic and diluted	$	(0.13	)	$	(0.08	)	$	(0.28	)	$	(0.16	)
Weighted average common shares outstanding – basic
and diluted		29,399,000			34,898,000			29,216,000			34,083,000

PowerFleet, Inc. and Subsidiaries
Condensed Consolidated Balance Sheet Data


	As of
	December 31, 2020		June 30, 2021
			(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	18,127,000	$	39,861,000
Restricted cash		308,000		308,000
Accounts receivable, net		24,147,000		29,656,000
Inventory, net		12,873,000		13,472,000
Deferred costs – current		3,128,000		2,800,000
Prepaid expenses and other current assets		6,184,000		6,909,000
Total current assets		64,767,000		93,006,000

Deferred costs – less current portion		2,233,000		1,163,000
Fixed assets, net		8,804,000		8,866,000
Goodwill		83,344,000		83,344,000
Intangible assets, net		31,276,000		28,678,000
Right of use asset		9,700,000		9,451,000
Severance payable fund		4,056,000		4,062,000
Deferred tax asset		1,506,000		1,005,000
Other assets		3,115,000		3,177,000
Total assets	$	208,801,000	$	232,752,000

LIABILITIES
Current liabilities:
Short-term bank debt and current maturities of long-term debt	$	5,579,000	$	5,918,000
Accounts payable and accrued expenses		20,225,000		23,563,000
Deferred revenue – current		7,339,000		8,048,000
Lease liability – current		2,755,000		2,190,000
Total current liabilities		35,898,000		39,719,000

Long-term debt, less current maturities		23,179,000		20,015,000
Deferred revenue – less current portion		6,006,000		5,421,000
Lease liability – less current portion		7,050,000		7,416,000
Accrued severance payable		4,714,000		4,672,000
Other long-term liabilities		674,000		739,000

Total liabilities		77,521,000		77,982,000

MEZZANINE EQUITY
Convertible redeemable Preferred stock: Series A		51,992,000		52,327,000

STOCKHOLDERS’ EQUITY		–		–
Total Powerfleet, Inc. stockholders’ equity		79,213,000		102,364,000
Non-controlling interest		75,000		79,000
Total equity		79,288,000		102,443,000
Total liabilities and stockholders’ equity	$	208,801,000	$	232,752,000

PowerFleet, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flow Data


	Six Months Ended June 30,
	2020			2021
				(Unaudited)
Cash flows from operating activities (net of net assets acquired):
Net loss	$	(6,052,000	)	$	(3,224,000	)
Adjustments to reconcile net loss to cash (used in) provided by operating activities:
Non-controlling interest		(16,000	)		(1,000	)
Inventory reserve		126,000			135,000
Stock based compensation expense		2,167,000			2,452,000
Depreciation and amortization		4,050,000			4,231,000
Right-of-use assets, non-cash lease expense		1,437,000			1,503,000
Bad debt expense		543,000			531,000
Other non-cash items		(35,000	)		160,000
Deferred taxes		653,000			540,000
Changes in:
Operating assets and liabilities		1,542,000			(3,124,000	)

Net cash (used in) provided by operating activities		4,415,000			3,203,000

Cash flows from investing activities:
Proceeds from sale of property and equipment		35,000			–
Capital expenditures		(822,000	)		(1,454,000	)

Net cash (used in) investing activities		(787,000	)		(1,454,000	)

Cash flows from financing activities:
Net proceeds from stock offering		4,041,000			26,867,000
Payment of preferred stock dividend		–			(2,056,000	)
Repayment of long-term debt		(991,000	)		(2,671,000	)
Short-term bank debt, net		(357,000	)		93,000
Proceeds from exercise of stock options		342,000			142,000
Purchase of treasury stock upon vesting of restricted stock		(248,000	)		(362,000	)

Net cash (used in) provided by financing activities		2,787,000			22,013,000

Effect of foreign exchange rate changes on cash and cash equivalents		(1,341,000	)		(2,028,000	)
Net increase in cash, cash equivalents and restricted cash		5,074,000			21,734,000
Cash, cash equivalents and restricted cash – beginning of period		16,703,000			18,435,000

Cash, cash equivalents and restricted cash – end of period	$	21,777,000		$	40,169,000

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Highlights of Avant’s Offerings:
Versatile AI Dataset: Available from Q3, this dataset will be regularly updated to support a wide array of AI projects, providing a solid foundation for development, and reducing the time to market for AI solutions.Dynamic Resource Scaling: The network dynamically adjusts computing resources to meet real-time demands, maximizing efficiency and minimizing costs.Accelerated AI Processing: Utilizes cutting-edge distributed computing to dramatically reduce data processing times, enabling rapid iteration and deployment of AI models.Robust Security Measures: Top-tier security protocols are in place to ensure data integrity and compliance with stringent regulatory standards.Seamless Integration: Designed to integrate smoothly with existing AI development environments, minimizing disruptions and simplifying technology adoption.Avant is committed to advancing the AI landscape by providing scalable solutions that will benefit diverse sectors looking to harness the power of artificial intelligence.
CONTINUED… Read this and more news for Avant Technologies at: https://usanewsgroup.com/2023/10/26/unlocking-the-trillion-dollar-ai-market-what-investors-need-to-know/
In other industry developments and happenings in the market this week include:
NVIDIA Corporation (NASDAQ: NVDA) (NEO: NVDA), a global leader in providing graphics and compute and networking solutions, recently received an investment of ~US$960 million from Japanese telecommunications company Softbank to enhance its supercomputing power and to support an ambitious generative AI (GenAI) strategy.
Generative AI is increasingly being incorporated into products and services across multiple sectors. A recent projection by Statista, a research firm based in Germany, predicts that the market for generative AI in Japan will expand to approximately $13 billion by 2030, representing a 17x increase from its size in 2023.
Microsoft Corporation (NASDAQ: MSFT) (NEO: MSFT), a global leader in developing and supporting software, services, devises and solutions recently announced it would be investing $1.5 billion into Abu Dhabi’s G42, the leading UAE-based AI tech holding company, to accelerate AI development and global expansion.
“Microsoft’s investment in G42 marks a pivotal moment in our company’s journey of growth and innovation, signifying a strategic alignment of vision and execution between the two organizations,” said H.H. Sheikh Tahnoon bin Zayed Al Nahyan, Chairman of G42. “This partnership is a testament to the shared values and aspirations for progress, fostering greater cooperation and synergy globally.”
G42 will operate its AI applications and services on Microsoft Azure, collaborating to offer advanced AI solutions to global public sector clients and large enterprises. Together, G42 and Microsoft aim to enhance AI and digital infrastructure across the Middle East, Central Asia, and Africa. This collaboration will help these regions gain fair access to services that address key government and business issues, while upholding the highest standards of security and privacy.
D-Wave Quantum Inc. (NYSE: QBTS), a leader in quantum computing systems, software, and services and the world’s first commercial supplier of quantum computers recently announced the launch the first fast-anneal feature, available now on all of D-Wave’s quantum processing units (QPUs) in the LeapTM real-time quantum cloud service. The fast-anneal feature has been central to D-Wave’s key research achievements, as highlighted in publications in Nature Physics and Nature, showing how annealing quantum computing outperforms traditional algorithms in tackling complex optimization problems.
“Providing direct access to Fast Anneal, which has been at the heart of D-Wave’s recent advancements, represents a significant step forward in our mission to provide customers with the resources they need to drive innovation and achieve extraordinary results,” said Dr. Alan Baratz, CEO of D-Wave. “We believe it will further empower them to build industry-shaping applications with the most powerful quantum computing environment available today.”
With enhanced control allowing for notably quicker annealing times than before, this feature enables customers to replicate and expand upon D-Wave’s significant optimization results. Now widely available, this feature allows users to execute quantum computations at unprecedented speeds, significantly mitigating issues like thermal fluctuations and noise that typically disrupt quantum calculations.
Rigetti Computing, Inc. (NASDAQ: RGTI, RGITW), a pioneer in full-stack quantum-classical computing, recently announced the successful completion of its Innovate UK project with Oxford Instruments to launch one of the first UK-based quantum computers. The consortium also included the Quantum Software Lab at the University of Edinburgh, Phasecraft, and Standard Chartered Bank, with financial backing from the UK government’s Quantum Technologies Challenge, led by UK Research & Innovation (UKRI).
“Completing this project, with the end result being a useful 32-qubit quantum computer, is an exceptional achievement for all of the project partners,” said Dr. Subodh Kulkarni, CEO of Rigetti. “It takes a world-class team to build and deploy a quantum computer. The UK has become a world leader in quantum computing technologies, and we are excited to continue to contribute to its quantum computing capabilities. Additionally, Rigetti plans to leverage this experience to continue to develop our UK quantum computing leadership as we embark on deploying a 24-qubit Ankaa-class quantum computer at the NQCC’s Harwell campus.”
Source: https://usanewsgroup.com/2023/10/26/unlocking-the-trillion-dollar-ai-market-what-investors-need-to-know/
CONTACT:USA NEWS [email protected] (604) 265-2873
DISCLAIMER: Nothing in this publication should be considered as personalized financial advice. We are not licensed under securities laws to address your particular financial situation. No communication by our employees to you should be deemed as personalized financial advice. Please consult a licensed financial advisor before making any investment decision. This is a paid advertisement and is neither an offer nor recommendation to buy or sell any security. We hold no investment licenses and are thus neither licensed nor qualified to provide investment advice. The content in this report or email is not provided to any individual with a view toward their individual circumstances. USA News Group is a wholly-owned subsidiary of Market IQ Media Group, Inc. (“MIQ”). MIQ has been paid a fee for Avant Technologies Inc. advertising and digital media from the company directly. There may be 3rd parties who may have shares Avant Technologies Inc., and may liquidate their shares which could have a negative effect on the price of the stock. This compensation constitutes a conflict of interest as to our ability to remain objective in our communication regarding the profiled company. Because of this conflict, individuals are strongly encouraged to not use this publication as the basis for any investment decision. The owner/operator of MIQ own shares of Avant Technologies Inc. which were purchased as a part of a private placement. MIQ reserves the right to buy and sell, and will buy and sell shares of Avant Technologies Inc. at any time thereafter without any further notice. We also expect further compensation as an ongoing digital media effort to increase visibility for the company, no further notice will be given, but let this disclaimer serve as notice that all material disseminated by MIQ has been approved by the above mentioned company; this is a paid advertisement, and we own shares of the mentioned company that we will sell, and we also reserve the right to buy shares of the company in the open market, or through further private placements and/or investment vehicles. While all information is believed to be reliable, it is not guaranteed by us to be accurate. Individuals should assume that all information contained in our newsletter is not trustworthy unless verified by their own independent research. Also, because events and circumstances frequently do not occur as expected, there will likely be differences between any predictions and actual results. Always consult a licensed investment professional before making any investment decision. Be extremely careful, investing in securities carries a high degree of risk; you may likely lose some or all of the investment.

View original content:https://www.prnewswire.co.uk/news-releases/ai-supercomputing-market-growing-at-21-cagr-as-industries-evolve-data-analysis-302124990.html

Artificial Intelligence

Artificial Intelligence Investment Soars to Trillions, Sparking Regulatory Interest

Published

6 hours ago

April 23, 2024

CISION (PR Newswire)

USA News Group Commentary
VANCOUVER, BC, April 23, 2024 /PRNewswire/ — USA News Group – In just a few years, the potential generated by the rise of Artificial Intelligence (AI) continues to entice investment to the tune of many trillions, with McKinsey & Company projecting generative AI to generate up to $7.9 trillion alone annually. It’s a sector that’s still in its early stages, and with that comes plenty of scrutiny, including the recent actions by US regulators regarding whether or not investors of OpenAI were misled, through an SEC inquiry launched in February. All the while, corporate AI investment is surging, with several companies benefitting including NVIDIA Corporation (NASDAQ:NVDA) (NEO:NVDA), Meta Platforms Inc. (NASDAQ:META) (NEO:META), Apple Inc. (NASDAQ:AAPL) (NEO:AAPL), C3.ai, Inc. (NYSE:AI), and Avant Technologies Inc. (OTC:AVAI).

Looking to help unlock the full potential of AI, Avant Technologies Inc. (OTC:AVAI) is pursuing its stated mission to build the nation’s first supercomputing network to provide big data and AI software companies with a faster, more powerful, and more cost-effective compute infrastructure. Recently Avant signed a co-development agreement with Wired4Tech, Inc. to create high-density compute infrastructure and supercomputer network software to move the company closer to achieving this mission.
“The technological innovations that we expect this collaboration to yield will help to usher in a new era of performance, cost efficiency and environmental sustainability for AI and Big Data,” said Timothy Lantz, CEO of Avant. “We have made exciting progress in the past several months, and we believe this partnership will further help to accelerate speed-to-market of our next generation solutions.”
The Wired4Tech collaboration aims to assist in the final stages of development and testing for Avant’s new high-density private cloud infrastructure solution. Additionally, it will start to establish the groundwork for Avant’s proposed AI supercomputing network. Avant expects to launch its next-generation infrastructure solution sometime in the first half of 2024.
“We’re at an inflection point where accelerated computing and generative AI have come together to speed innovation at an unprecedented pace,” said Paul Averill, Founder and CEO of Wired4Tech. “Our partnership with Avant Technologies will help AI companies accelerate their work with infrastructure, software and services that drive efficiency and reduce costs. There is no AI without the right infrastructure and Avant will lead the way with its unique and innovative and cost-effective AI platform.”
The collaboration was a follow-up to Avant’s announcement that the company is set to leverage its proprietary AI to drive proactive, next-generation data center security, through its enhancements to Avant! AI™, that seamlessly integrates with industry-standard data science tools and algorithms, enabling organizations to harness the power of data for deeper insights and informed decision-making.
“The rapid advancements in AI are unlocking tremendous opportunities and potential across almost every facet of our lives, but those same advancements can also pose an increased threat when used by those with an intent to harm,” said Lantz. “In today’s digital world cybersecurity is of paramount importance and Avant is committed to providing our customers with the necessary tools to ensure the safety and security of their information and that of their end-users.”
The planned improvements in Avant’s proprietary gen AI are designed to achieve two main goals: to provide early detection of potential security vulnerabilities and to offer recommendations for proactive measures to strengthen cybersecurity baselines, reduce risks, and ensure compliance in the ever-changing digital environment.
Under the hood of many of the biggest AI setups today are products from NVIDIA Corporation (NASDAQ:NVDA) (NEO:NVDA), which has seen its market cap surge to more than $2 trillion based upon an insatiable AI chip demand. This includes mega investments from some of the largest tech companies on the planet, including Meta Platforms Inc. (NASDAQ:META) (NEO:META) which is spending billions of dollars on Nvidia’s AI chips.
Shared through an Instagram Reels post by CEO Mark Zuckerberg, Meta’s “future roadmap” for AI requires the construction of “an absolutely massive amount of infrastructure.” By the end of 2024, Zuckerberg mentioned that this infrastructure will comprise 350,000 H100 graphics cards from Nvidia—which were being sold for more than $40,000 on eBay as recently as last April.
The ramp up of GPUs for Meta is projected to cost as much as $18 billion by the end of 2024. The ambitious loading up of infrastructure is similar to Meta’s $13 billion spent on Reality Labs, its metaverse division in 2022.
Competition for computing power will be ramping up, as Apple Inc. (NASDAQ:AAPL) (NEO:AAPL) has signalled the company will be investing significantly in generative AI, as it moves away from its self-driving electric car project. So far, Apple CEO Tim Cook hasn’t launched any competing products to models like OpenAI’s GPT or Google’s Gemini, but he has already teased a major announcement that the company will “break new ground” in GenAI coming later this year.
“AI is woven into our users’ lives for all sorts of tasks, from the everyday to the essential,” said Tim Cook. “AI allows Apple Watch to help you track your workouts, automatically detecting whether you’re taking a walk or going for a swim. It enables your iPhone to call for help if you’re in a car accident.”
While Cook’s sentiments hint towards Apple moving more towards AI investment, the company’s investors have grown impatient with the tech giant after lagging behind its mega-tech peers who have shared much clearer AI strategies.
Enterprise AI application software company C3.ai, Inc. (NYSE:AI) is coming off of a healthy Q3 2024 financial results announcement, where they saw total revenue grow 18% year-over-year to $78.4 million, exceeding their guidance range. Perhaps more importantly, C3 AI saw its customer engagement grow 80% year-over-year, and a 23% increase in subscription revenue.
“Generative AI use cases continue to influence customer engagement, with 17 of 29 total pilots signed in the quarter driven by generative AI,” said Kingsley Crane, analyst at Canaccord Genuity, about C3 AI in a report. “So far, the company has been converting pilots into full-time customers roughly near the assumed spend levels of $210,000 per quarter, even if some pilots have pushed a bit beyond the initially planned six months and started a bit lower than $500,000 contribution over two quarters. If C3 can continue the sequential growth in product revenue we’ve seen over the past three quarters, the firm is on track to grow over 30%.”
Among the customer base that C3 AI has been working with is biotech giant Genentech, to improve the complex biologics manufacturing process with AI. Genentech began using the AI application in 2021 to ensure centrifuges in their facility remained operational, with patients benefitting by receiving their medicines on time. In 2022, the biotech developer would go on to expand its use of C3’s assets beyond centrifuges, to around 200 pieces of equipment in total. Now Genentech has nearly 200 users including data scientists and facility managers who are trained to use the C3 AI platform, and regularly use the AI application to evaluate equipment health and maintain manufacturing operations.
Source: https://usanewsgroup.com/2023/10/26/unlocking-the-trillion-dollar-ai-market-what-investors-need-to-know/
CONTACT:
USA News Group
[email protected]
DISCLAIMER: Nothing in this publication should be considered as personalized financial advice. We are not licensed under securities laws to address your particular financial situation. No communication by our employees to you should be deemed as personalized financial advice. Please consult a licensed financial advisor before making any investment decision. This is a paid advertisement and is neither an offer nor recommendation to buy or sell any security. We hold no investment licenses and are thus neither licensed nor qualified to provide investment advice. The content in this report or email is not provided to any individual with a view toward their individual circumstances. USA News Group is a wholly-owned subsidiary of Market IQ Media Group, Inc. (“MIQ”). MIQ has been paid a fee for Avant Technologies Inc. advertising and digital media from the company directly. There may be 3rd parties who may have shares Avant Technologies Inc., and may liquidate their shares which could have a negative effect on the price of the stock. This compensation constitutes a conflict of interest as to our ability to remain objective in our communication regarding the profiled company. Because of this conflict, individuals are strongly encouraged to not use this publication as the basis for any investment decision. The owner/operator of MIQ own shares of Avant Technologies Inc. which were purchased as a part of a private placement. MIQ reserves the right to buy and sell, and will buy and sell shares of Avant Technologies Inc. at any time thereafter without any further notice. We also expect further compensation as an ongoing digital media effort to increase visibility for the company, no further notice will be given, but let this disclaimer serve as notice that all material disseminated by MIQ has been approved by the above mentioned company; this is a paid advertisement, and we own shares of the mentioned company that we will sell, and we also reserve the right to buy shares of the company in the open market, or through further private placements and/or investment vehicles. While all information is believed to be reliable, it is not guaranteed by us to be accurate. Individuals should assume that all information contained in our newsletter is not trustworthy unless verified by their own independent research. Also, because events and circumstances frequently do not occur as expected, there will likely be differences between any predictions and actual results. Always consult a licensed investment professional before making any investment decision. Be extremely careful, investing in securities carries a high degree of risk; you may likely lose some or all of the investment.

View original content:https://www.prnewswire.co.uk/news-releases/artificial-intelligence-investment-soars-to-trillions-sparking-regulatory-interest-302124950.html