Bay Street News

Jet.AI Reports Second Quarter 2024 Financial Results

LAS VEGAS, Aug. 14, 2024 (GLOBE NEWSWIRE) — Jet.AI (the “Company”) (Nasdaq: JTAI), an innovative private aviation and artificial intelligence (“AI”) company, today announced financial results for the second quarter ended June 30, 2024.

Second Quarter 2024 and Recent Operational Highlights

Second Quarter 2024 Financial Results

Revenues were $3.1 million, an increase of $0.3 million compared to the same period last year. The primary reason was due to additional service revenue arising from an additional management agreement for customer aircraft and increased chartering of the Company’s Citation CJ4.

Software App and Cirrus Charter revenue, the gross amount of charters booked through CharterGPT and Cirrus, was $1.6 million, a slight increase compared to the same period last year.

Management and Other Services revenue, which is comprised of revenues generated from managing and chartering our customer aircrafts, totaled $914,000 compared to $423,000 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 $559,000 compared to $811,000 in the same period last year.

Cost of revenues totaled $3.5 million compared to $3.0 million in the same period last year. The increase is primarily due to an increase in Cirrus charter flight activity, costs related to the operation of aircraft and payments to Cirrus for their management.

Gross loss totaled approximately $417,000 compared to $201,000 in the same period last year. The increase was largely driven by reduced flights performed for the Company’s jet card customers without a corresponding reduction in fixed costs.

Operating expenses totaled $2.8 million compared to $2.2 million in the same period last year. The increase was primarily due to an increase in general and administrative expenses, research and development costs, offset by slightly lower sales and marketing expenses.

Operating loss was approximately $3.2 million compared to $2.4 million in the same period last year. The increase was primarily due to the increase in general and administrative expenses resulting from the increase in professional service expenses and wages following the Business Combination.

As of June 30, 2024, the Company had cash and cash equivalents of approximately $528,000 compared to $595,555 as of March 31, 2024.

Management Commentary
“In the second quarter, we made significant progress in our anticipated fleet deal with Bombardier, as we announced a non-binding, non-recourse debt financing arrangement, alongside securing $16.5 million in financing from Ionic Ventures LLC,” said Founder and Executive Chairman Mike Winston. “Additionally, we successfully completed the warrant exchange offer, eliminating potentially dilutive warrant overhang and simplifying our capital structure.”

“We received an unsolicited bid for one of our HondaJets at a price that would imply a net economic benefit compared to its continued use in the fleet and so have entered into a contract to sell it as part of our gradual reorientation of the fleet toward the higher margin Challenger 3500 aircraft. We separately have made several advancements on our software business, including the implementation of Reroute AI for our Jet Card holders offering empty leg benefits, and the launch of our enhanced DynoFlight 2.0 platform, which integrates AI and synced fleet data with our partner, FL3XX. These two solutions, along with CharterGPT, continue to attract market interest. We remain cautiously optimistic and look forward to announcing further news on our proposed fleet deal.”

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 fractions, jet cards, 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 statements that may be deemed to be “forward-looking statements” within the meaning of the federal securities laws, including the safe harbor provisions under the Private Securities Litigation Reform Act of 1995, 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. Statements that are not historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements relate to future events or our future performance or future financial condition. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about our Company, our industry, our beliefs and our assumptions. 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 or the negative of these terms or other similar expressions, but the absence of these words does not mean that a statement is not forward-looking. 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 Company’s most recent Annual Report on Form 10-K and subsequent reports filed with the Securities and Exchange Commission. 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, except as provided by law.

Jet.AI Investor Relations:
Gateway Group, Inc.
949-574-3860
Jet.AI@gateway-grp.com

JET.AI, INC.
(FORMERLY JET TOKEN, INC.)
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
           
  June 30,     December 31,  
  2024     2023  
  (Unaudited)        
           
Assets          
Current assets:          
Cash and cash equivalents $ 528,117     $ 2,100,543  
Accounts receivable 535,975     96,539  
Other current assets 72,769     190,071  
Prepaid offering costs 800,000     800,000  
Total current assets 1,936,861     3,187,153  
           
Property and equipment, net 6,329     7,604  
Intangible assets, net 20,401     73,831  
Right-of-use lease asset 1,312,332     1,572,489  
Investment in joint venture 100,000     100,000  
Deposits and other assets 798,211     798,111  
Total assets $ 4,174,134     $ 5,739,188  
           
Liabilities and Stockholders’ Deficit          
Current liabilities:          
Accounts payable $ 1,515,201     $ 1,656,965  
Accrued liabilities 2,749,030     2,417,115  
Deferred revenue 1,099,466     1,779,794  
Operating lease liability 517,733     510,034  
Note payable, net     321,843  
Notes payable – related party, net     266,146  
Total current liabilities 5,881,430     6,951,897  
           
Lease liability, net of current portion 760,524     1,021,330  
Redeemable preferred stock 1,702,000     1,702,000  
Total liabilities 8,343,954     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      
Common stock, 55,000,000 shares authorized, par value $0.0001, 14,755,144 and 9,754,364 issued and outstanding 1,475     975  
Subscription receivable (6,724 )   (6,724 )
Additional paid-in capital 41,557,422     35,342,098  
Accumulated deficit (45,721,993 )   (39,272,388 )
Total stockholders’ deficit (4,169,820 )   (3,936,039 )
Total liabilities and stockholders’ deficit $ 4,174,134     $ 5,739,188  
JET.AI, INC.
(FORMERLY JET TOKEN, INC.)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
 
  Three Months Ended
  Six Months Ended
  June 30,
  June 30,
  2024     2023     2024     2023  
                       
Revenues $ 3,083,884     $ 2,792,808     $ 6,932,482     $ 4,668,316  
                       
Cost of revenues 3,500,880     2,993,631     7,473,834     4,944,157  
                       
Gross loss (416,996 )   (200,823 )   (541,352 )   (275,841 )
                       
Operating Expenses:                      
General and administrative (including stock-based compensation of $1,201,728, $1,348,043, $2,401,046, and $2,755,087, respectively) 2,663,753     2,115,704     5,210,047     4,603,722  
Sales and marketing 102,470     103,541     549,070     223,708  
Research and development 37,396     28,636     69,942     64,955  
Total operating expenses 2,803,619     2,247,881     5,829,059     4,892,385  
                       
Operating loss (3,220,615 )   (2,448,704 )   (6,370,411 )   (5,168,226 )
                       
Other expense (income):                      
Interest expense         79,314      
Other income (59 )       (120 )    
Total other expense (income) (59 )       79,194      
                       
Loss before provision for income taxes (3,220,556 )   (2,448,704 )   (6,449,605 )   (5,168,226 )
                       
Provision for income taxes              
                       
Net Loss $ (3,220,556 )   $ (2,448,704 )   $ (6,449,605 )   $ (5,168,226 )
                       
Less cumulative preferred stock dividends 29,727         59,455      
                       
Net Loss to common stockholders $ (3,250,283 )   $ (2,448,704 )   $ (6,509,060 )   $ (5,168,226 )
                       
Weighted average shares outstanding – basic and diluted 12,906,352     4,520,625     12,224,502     4,511,751  
Net loss per share – basic and diluted $ (0.25 )   $ (0.54 )   $ (0.53 )   $ (1.15 )
                       
                       
check – should be zero                    
Per BS             $ (6,449,605 )      
                       
Stock-based compensation $ 1,201,728     $ 1,348,043     $ 2,401,046     $ 2,755,087  
JET.AI, INC.
(FORMERLY JET TOKEN, INC.)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
   
  Six Months Ended
  June 30,
  2024     2023  
           
CASH FLOWS FROM OPERATING ACTIVITIES:          
Net loss $ (6,449,605 )   $ (5,168,226 )
Adjustments to reconcile net loss to net cash used in
operating activities:
         
Amortization and depreciation 67,626     67,192  
Amortization of debt discount 80,761      
Stock-based compensation 2,401,046     2,755,087  
Non-cash operating lease costs 260,157     252,686  
Changes in operating assets and liabilities:          
Accounts receivable (439,436 )    
Other current assets 117,302     171,876  
Accounts payable (141,764 )   254,773  
Accrued liabilities 331,915     (173,160 )
Deferred revenue (680,328 )   166,182  
Operating lease liability (253,107 )   (245,636 )
Net cash used in operating activities (4,705,433 )   (1,919,226 )
           
CASH FLOWS FROM INVESTING ACTIVITIES:          
Purchase of property and equipment     (4,340 )
Purchase of intangible assets (12,921 )   (17,174 )
Investment in joint venture     (100,000 )
Deposits and other assets (100 )   (135 )
Net cash used in investing activities (13,021 )   (121,649 )
           
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 Series B Preferred Stock 1,500,025      
Proceeds from sale of Common Stock 1,727,279     1,588,695  
Net cash provided by financing activities 3,146,028     1,151,726  
           
Decrease in cash and cash equivalents (1,572,426 )   (889,149 )
Cash and cash equivalents, beginning of period 2,100,543     1,527,391  
Cash and cash equivalents, end of period $ 528,117     $ 638,242  
           
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 Stock $     $ 25,479  


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