USBC, Inc.

Know Labs reported a Q3 fiscal 2024 net loss of $4.1 million versus $3.6 million in Q3 fiscal 2023, an increase of 13.9%. EPS was a loss of $0.05 versus a loss of $0.07 a year ago, an improvement of 29% before preferred stock dividends. Non-cash expenses in the quarter were $1.58 million, including $1 million of stock-based compensation, $276,000 of amortization of operating lease right-of-use asset, and $240,000 of interest expense for extension of notes and warrants. R&D expense declined 28.2% to $1.35 million from $1.88 million, while SG&A increased to $2.49 million from $1.36 million. Cash and cash equivalents were about $2.13 million at June 30, 2024. Subsequent to quarter end, the company closed a $3.445 million firm commitment underwritten public offering at $0.26 per unit, with a path to an additional $3.4 million from warrants. Management said this financing, together with cash on hand, should fund operations until at least December 31, 2024, and it plans to seek additional funding under its S-3 shelf to operate well into 2025.

Ron Erickson framed the quarter around execution on four workstreams: hardware, clinical data, algorithms, and intellectual property. He emphasized that KnowU is a wearable, non-invasive CGM that is 85% smaller than Gen1 and that the company is using it to collect continuous data across body locations and glycemic ranges. His tone was upbeat and strategic, but he also signaled that more work remains on miniaturization, clinical validation, and preparation for commercialization.

Pete Conley focused on the quarter’s financial profile and liquidity. He cited the $4.1 million net loss, the $1.58 million of non-cash expenses, the $1.35 million of R&D spending, and the $2.49 million of SG&A, then noted cash and cash equivalents of about $2.13 million at June 30, 2024. He said the $3.445 million post-quarter equity raise and existing cash should support operations until at least December 31, 2024, while the company takes steps to reduce fixed expenses, burn, and address negative shareholder equity through actions including debt conversion to equity.

There was no Q&A because the company said it was in the SEC quiet period following the recent capital raise. Management instead directed investors to the September 26 annual shareholders meeting, when they said questions could be taken. The closest thing to analyst-style discussion was the company’s commentary that it is seeking additional funding under its shelf registration and that the recent financing provides only short-term runway.