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Organization and Nature of Business
6 Months Ended
Jun. 30, 2020
Organization and Nature of Business [Abstract]  
Organization and Nature of Business

Note 1 - Organization and Nature of Business

 

Inpixon, and its wholly-owned subsidiaries, Inpixon Canada, Inc. ("Inpixon Canada"), Inpixon Limited, Inpixon GmbH and its majority-owned subsidiary Inpixon India Limited ("Inpixon India") (unless otherwise stated or the context otherwise requires, the terms "Inpixon" "we," "us," "our" and the "Company" refer collectively to Inpixon and the aforementioned subsidiaries), are an indoor intelligence company. Our business and government customers use our solutions to secure, digitize and optimize their indoor spaces with our positioning, mapping and analytics products. Our indoor intelligence platform uses sensor technology to detect accessible cellular, Wi-Fi, Bluetooth, ultra-wide band ("UWB") and radio frequency identification ("RFID") signals emitted from devices within a venue providing positional information similar to what global positioning system ("GPS") satellite systems provide for the outdoors. Combining this positional data with our dynamic and interactive mapping solution and a high-performance analytics engine, yields near real time insights to our customers providing them with visibility, security and business intelligence within their indoor spaces. Our highly configurable platform can also ingest data from our customers' and other third party sensors, Wi-Fi access points, Bluetooth beacons, video cameras, and big data sources, among others to maximize indoor intelligence. The Company also offers digital tear-sheets with optional invoice integration, digital ad delivery, and an e-edition designed for reader engagement for the media, publishing and entertainment industry. The Company is headquartered in Palo Alto, California, and has subsidiary offices in Coquitlam, Canada, New Westminster, Canada, Toronto, Canada and Hyderabad, India.

 

Liquidity

 

As of June 30, 2020, the Company has a working capital total of approximately $30.0 million and cash of $39.5 million. The Company experienced a net loss of approximately $7.3 million and $5.2 million for the three months ended June 30, 2020 and 2019, respectively, and a net loss of $13.5 million and $10.4 million for the six months ended June 30, 2020 and 2019, respectively. On March 3, 2020, the Company entered into an Equity Distribution Agreement ("EDA") with Maxim Group LLC ("Maxim") under which the Company may offer and sell shares of our common stock in connection with an at-the-market equity facility ("ATM") in an aggregate offering amount of up to $50 million, which was increased on June 19, 2020 to $150 million pursuant to an amendment to the EDA, from time to time through Maxim, acting exclusively as our sales agent. The Company issued 29,970,046 shares of common stock during the six months ended June 30, 2020 in connection with the ATM resulting in net proceeds to the Company of approximately $41.8 million. Subsequent to the quarter ended June 30, 2020, the Company issued an additional 1,604,312 shares of common stock in connection with the ATM, resulting in net proceeds to the Company of approximately $2.3 million.

 

Risks and Uncertainties

 

The Company cannot assure you that we will ever earn revenues sufficient to support our operations, or that we will ever be profitable. In order to continue our operations, we have supplemented the revenues we earned with proceeds from the sale of our equity and debt securities and proceeds from loans and bank credit lines. While we believe that the capital raised or that may be raised in connection with sales under our ATM in an aggregate amount of up to $150 million, the impact of the COVID-19 pandemic on our business and results of operations is uncertain at this time. While we have been able to continue operations remotely we have experienced supply chain constraints and delays in the receipt of certain components of our products impacting delivery times for our products, we have also seen some impact in the demand of certain products, delays in certain projects and customer orders either because they require onsite services which could not be performed while shelter in place orders have been in effect or because of the uncertainty of the customer's financial position and ability to invest in our technology. In addition, while certain anticipated second quarter projects were initially delayed by customers, following the end of the quarter we received a substantial purchase order for our sensors from a significant customer and have also secured certain reseller partnerships focused on increasing interest in our indoor intelligence solutions for workplace readiness which is directed at enterprise organizations and government agencies to assist them in optimizing the use of their facilities as well as in developing and monitoring compliance with corporate policies and government regulations for physical distancing, exposure notification, and the identification of high traffic areas for sanitizing and cleaning in order to keep their employees healthier and safer within the workplace. If we are successful in expanding the adoption of our products and services for this and or other solutions, and are able to add to our revenue growth through the completion of strategic transactions, we may be able to offset any revenue loss that may be experienced due to any constraints resulting from the pandemic or other general economic conditions, however, there are no assurances that we will be successful or that we will be able to offset any losses, if realized.

 

Given our cash balances and our budgeted cash flow requirements, the Company believes such funds are sufficient to support ongoing operations at least one year after the issuance of these financial statements. The Company has control over its expenditures and has the ability to adjust spending accordingly based on its budgeted cash flow requirements and the excess cash on hand.