XTI Aerospace (XTIA) 10-Q15 May 172017 Q1 Quarterly reportFinancial data

Company Profile

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2017	May 11, 2017
Document and Entity Information [Abstract]
Entity Registrant Name	INPIXON
Entity Central Index Key	1,529,113
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Type	10-Q
Trading Symbol	INPX
Document Period End Date	Mar. 31, 2017
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q1
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		2,441,745

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Current Assets
Cash and cash equivalents	$ 738	$ 1,821
Accounts receivable, net	6,418	11,788
Notes and other receivables	341	362
Inventory	782	1,061
Prepaid licenses and maintenance contracts	10,907	13,321
Assets held for sale	23	23
Prepaid assets and other current assets	1,347	1,768
Total Current Assets	20,556	30,144
Prepaid licenses and maintenance contracts, non-current	4,282	5,169
Property and equipment, net	1,278	1,385
Software development costs, net	2,183	2,058
Intangible assets, net	16,308	17,691
Goodwill	9,028	9,028
Other assets	942	998
Total Assets	54,577	66,473
Current Liabilities
Accounts payable	22,528	23,027
Accrued liabilities	4,280	4,169
Deferred revenue	12,382	15,043
Short-term debt	4,618	6,887
Liabilities held for sale	2,046	2,041
Total Current Liabilities	45,854	51,167
Long Term Liabilities
Deferred revenue, non-current	4,932	5,960
Long-term debt	4,342	4,047
Other liabilities	374	371
Acquisition liability - Integrio	1,558	1,648
Acquisition liability - LightMiner		567
Total Liabilities	57,060	63,760
Commitments and Contingencies
Stockholders' (Deficit) Equity
Preferred stock, value
Convertible Series 1 Preferred Stock	1,340	1,340
Common stock - $0.001 par value; 50,000,000 shares authorized; 2,197,667 and 2,171,886 issued and 2,181,745 and 2,155,964 outstanding at March 31, 2017 and December 31, 2016, respectively	2	2
Additional paid-in capital	64,997	64,148
Treasury stock, at cost, 15,922 shares	(695)	(695)
Due from Sysorex Consulting Inc.	(666)	(666)
Accumulated other comprehensive income	63	52
Accumulated deficit (excluding $2,442 reclassified to additional paid in capital in quasi-reorganization)	(65,525)	(59,473)
Stockholders' (Deficit) Equity Attributable to Inpixon	(484)	4,708
Non-controlling Interest	(1,999)	(1,995)
Total Stockholders' (Deficit) Equity	(2,483)	2,713
Total Liabilities and Stockholders' (Deficit) Equity	$ 54,577	$ 66,473

Condensed Consolidated Balance3

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	2,250	2,250
Preferred stock, shares outstanding	2,250	2,250
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	2,197,667	2,171,886
Common stock, shares outstanding	2,181,745	2,155,964
Treasury stock, shares	15,922	15,922
Accumulated deficit reclassified to additional paid in capital in quasi-reorganization	$ 2,442	$ 2,442
Convertible Series 1 Preferred Stock [Member]
Preferred stock, par value	$ 1,000	$ 1,000
Preferred stock, shares issued	2,250	2,250
Preferred stock, shares outstanding	2,250	2,250
Preferred stock, liquidation preference	$ 2,250,000	$ 2,250,000

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Revenues
Products	$ 9,448	$ 10,348
Services	4,033	3,739
Total Revenues	13,481	14,087
Cost of Revenues
Products	8,054	8,042
Services	2,139	2,098
Total Cost of Revenues	10,193	10,140
Gross Profit	3,288	3,947
Operating Expenses
Research and development	558	587
Sales and marketing	2,040	2,501
General and administrative	4,658	3,965
Acquisition related costs	3	20
Amortization of intangibles	1,383	1,056
Total Operating Expenses	8,642	8,129
Loss from Operations	(5,354)	(4,182)
Other Income (Expense)
Interest expense	(684)	(143)
Change in fair value of shares to be issued		(1)
Change in fair value of derivative liability	56
Other (expense) income	(65)	20
Total Other Income (Expense)	(693)	(124)
Net Loss from Continuing Operations	(6,047)	(4,306)
Loss from Discontinued Operations, Net of Tax	(9)
Net Loss	(6,056)	(4,306)
Net Loss Attributable to Non-controlling Interest	(4)	(4)
Net Loss Attributable to Stockholders of Inpixon	$ (6,052)	$ (4,302)
Net Loss Per Share - Basic and Diluted	$ (2.79)	$ (2.57)
Weighted Average Shares Outstanding
Basic and Diluted	2,170,909	1,673,714

Condensed Consolidated Stateme5

Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Statement of Comprehensive Income [Abstract]
Net Loss	$ (6,056)	$ (4,306)
Unrealized foreign exchange gain/(loss) from cumulative translation adjustments	11	17
Comprehensive Loss	$ (6,045)	$ (4,289)

Condensed Consolidated Stateme6

Condensed Consolidated Statement of Changes in Stockholders' (Deficit) Equity (Unaudited) - 3 months ended Mar. 31, 2017 - USD ($) shares in Thousands, $ in Thousands	Total	Series 1 Convertible Preferred Stock	Common Stock	Additional Paid-In Capital	Treasury Stock	Due from Sysorex Consulting, Inc.	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit	Non-Controlling Interest
Balance at Dec. 31, 2016	$ 2,713	$ 1,340	$ 2	$ 64,148	$ (695)	$ (666)	$ 52	$ (59,473)	$ (1,995)
Balance, shares at Dec. 31, 2016		2,250	2,171,886		(15,922)
Common shares issued for services	21			21
Common shares issued for services, shares			5,380
Stock options granted to employees for services	262			262
Common shares issued for LightMiner Acquisition	566			566
Common shares issued for LightMiner Acquisition, shares			18,905
Fractional shares issued for stock split			1,496
Cumulative Translation Adjustment	11						11
Net loss	(6,056)							(6,052)	(4)
Balance at Mar. 31, 2017	$ (2,483)	$ 1,340	$ 2	$ 64,997	$ (695)	$ (666)	$ 63	$ (65,525)	$ (1,999)
Balance, shares at Mar. 31, 2017		2,250	2,197,667		(15,922)

Condensed Consolidated Stateme7

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Cash Flows from Operating Activities
Net loss	$ (6,056)	$ (4,306)
Adjustment to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	401	263
Amortization of intangible assets	1,383	1,056
Stock based compensation	283	364
Change in fair value of shares to be issued		1
Change in fair value of derivative liability	(56)
Amortization of technology	17
Amortization of deferred financing costs	43
Amortization of debt discount	294
Provision for doubtful accounts		212
Other	13	2
Changes in operating assets and liabilities:
Accounts receivable and other receivables	5,392	787
Inventory	278	(67)
Other current assets	420	140
Prepaid licenses and maintenance contracts	3,301	446
Other assets	(3)	1
Accounts payable	(499)	(848)
Accrued liabilities	168	(1,323)
Deferred revenue	(3,689)	3,371
Other liabilities	(82)	(103)
Total Adjustments	7,664	4,302
Net Cash Provided by (Used in) Operating Activities	1,608	(4)
Cash Flows Used in Investing Activities
Purchase of property and equipment	(82)	(48)
Investment in capitalized software	(351)	(414)
Net Cash Flows Used in Investing Activities	(433)	(462)
Cash Flows Provided by Financing Activities
Advances (repayment) of line of credit	(2,269)	(588)
Repayment of term loan		(167)
Repayments to related party		(3)
Net Cash Used In Financing Activities	(2,269)	(758)
Effect of Foreign Exchange Rate on Changes on Cash	11	17
Net Decrease in Cash and Cash Equivalents	(1,083)	(1,207)
Cash and Cash Equivalents - Beginning of period	1,821	4,060
Cash and Cash Equivalents - End of period	738	2,853
Cash paid for:
Interest	237	142
Income Taxes

Organization and Nature of Busi

Organization and Nature of Business and Going Concern	3 Months Ended
Organization and Nature of Business and Going Concern	Mar. 31, 2017
Organization and Nature of Business and Going Concern [Abstract]
Organization and Nature of Business and Going Concern	Note 1 - Organization and Nature of Business and Going Concern Inpixon, through its wholly-owned subsidiaries, Inpixon USA, Inpixon Federal, Inc. (“Inpixon Federal”), Inpixon Canada, Inc. (“Inpixon Canada”) and the majority-owned subsidiary, Sysorex Arabia LLC (“Sysorex Arabia”) (unless otherwise stated or the context otherwise requires, the terms “Inpixon” “we,” “us,” “our” and the “Company” refer collectively to Inpixon and the above subsidiaries), provides Big Data analytics and location based products and related services for the cyber-security and Internet of Things markets. The Company is headquartered in California, and has sales and subsidiary offices in Virginia, Hawaii, State of Washington, California, Vancouver, Canada and Riyadh, Saudi Arabia. On November 21, 2016, and as more fully described in Note 4, the Company completed the acquisition of substantially all of the assets and certain liabilities of Integrio Technologies, LLC, which is in the U.S. Federal Government IT contracts business. As of March 31, 2017, the Company has a working capital deficiency of approximately $25.3 million. For the three months ended March 31, 2017, the Company incurred a net loss of approximately $6.1 million. The aforementioned factors raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The financial statements do not include any adjustments relating to the recoverability and classification of asset amounts or the classification of liabilities that might be necessary should the Company be unable to continue as a going concern within one year after the date the financial statements are issued. On August 9, 2016, the Company entered into a Securities Purchase Agreement with Hillair Capital Investments L.P. pursuant to which it issued and sold (i) an 8% Original Issue Discount Senior Convertible Debenture in an aggregate principal amount of $5,700,000 due on August 9, 2018 and (ii) 2,250 shares of newly created Series 1 Convertible Preferred Stock, par value $0.001 per share, for an aggregate purchase price of $5,000,000. The Company also has a credit facility with GemCap Lending I for up to $10 million (the “Credit Facility”) which we borrow against based on eligible assets of which approximately $4.4 million is utilized. The Credit Facility has a maturity date of November 14, 2018. During the third quarter of 2016, the Company implemented a cost cutting program that would reduce operating expenses by approximately $1.8 million on an annual basis. The Company’s capital resources as of March 31, 2017, availability on the $10.0 million Credit Facility (of which $4.4 million is utilized as of March 31, 2017), higher margin business line expansion and credit limitation improvements, may not be sufficient to fund planned operations during 2017. The Company will need to raise outside capital under structures availability to it including debt and/or equity offerings. The Company also has an effective registration statement on Form S-3 which will may allow it to raise additional capital from the sale of its securities, subject to certain limitations for registrants with a market capitalization of less than $75 million. The information in this Form 10-Q concerning the Company’s Form S-3 registration statement does not constitute an offer of any securities for sale. If these sources do not provide the capital necessary to fund the Company’s operations during the next twelve months, the Company may need to curtail certain aspects of its expansion activities or consider other means of obtaining additional financing, such as through the sale of assets or of a business segment, although there is no guarantee that the Company could obtain the financing necessary to continue its operations.

Basis of Presentation

Basis of Presentation	3 Months Ended
Basis of Presentation	Mar. 31, 2017
Basis of Presentation/Summary of Significant Accounting Policies [Abstract]
Basis of Presentation	Note 2 - Basis of Presentation The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information, which are the accounting principles that are generally accepted in the United States of America. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The results of the Company’s operations for the three month period ended March 31, 2017 is not necessarily indicative of the results to be expected for the year ending December 31, 2017. These interim condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements and notes for the years ended December 31, 2016 and 2015 included in the annual report Form 10-K filed with the U.S. Securities and Exchange Commission on April 17, 2017.

Summary of Significant Accounti

Summary of Significant Accounting Policies	3 Months Ended
Summary of Significant Accounting Policies	Mar. 31, 2017
Basis of Presentation/Summary of Significant Accounting Policies [Abstract]
Summary of Significant Accounting Policies	Note 3 - Summary of Significant Accounting Policies The Company’s complete accounting policies are described in Note 2 to the Company’s audited consolidated financial statements and notes for the years ended December 31, 2016 and 2015. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during each of the reporting periods. Actual results could differ from those estimates. The Company’s significant estimates consist of: ● the valuation of stock-based compensation; ● the allowance for doubtful accounts; ● the valuation allowance for the deferred tax asset; and ● impairment of long-lived assets and goodwill. Revenue Recognition The Company provides Information Technology solutions and services to customers and derives revenues primarily from the sale of third-party hardware and software products, software, assurance, licenses and other consulting services, including maintenance services and recognizes revenue once the following four criteria are met: (1) persuasive evidence of an arrangement exists; (2) the price is fixed and determinable, (3) shipment (software and hardware) or fulfillment (maintenance) has occurred,; and (4) there is reasonable assurance of collection of the sales proceeds (the “Revenue Recognition Criteria”). In addition, the Company also records revenues in accordance with Accounting Standards Codification (“ASC”) Topic 605-45 “Principal Agent Consideration” (“ASC 605-45”). The Company evaluates the sales of products and services on a case by case basis to determine whether the transaction should be recorded gross or net, including, but not limited to, assessing whether or not the Company: (1) is the primary obligor in the transaction; (2) has inventory risk with respect to the products and/or services sold; (3) has latitude in pricing; and (4) changes the product or performs part of the services sold. The Company evaluates whether revenues received from the sale of hardware and software products, licenses, and services, including maintenance and professional consulting services, should be recognized on a gross or net basis on a transaction by transaction basis. As of March 31, 2017, the Company has determined that all revenues received should be recognized on a gross basis in accordance with applicable standards. Cooperative reimbursements from vendors, which are earned and available, are recorded during the period the related transaction has occurred. Cooperative reimbursements are recorded as a reduction of cost of sales in accordance with ASC Topic 605-50 “Accounting by a Customer (including reseller) for Certain Consideration Received from a Vendor.” Provisions for returns are estimated based on historical collections and credit memo analysis for the period. The Company receives Marketing Development Funds from vendors based on quarterly or annual sales performance to promote the marketing of vendor products and services. The Company must file claims with vendors for these cooperative reimbursements by providing invoices and receipts for marketing expenses. Reimbursements are recorded as a reduction of marketing expenses and other applicable selling, general and administrative expenses ratably over the period in which the expenses are expected to occur. The Company receives vendor rebates which are recorded to cost of sales. The Company also enters into sales transactions whereby customer orders contain multiple deliverables, and reports its multiple deliverable arrangements under ASC 605-25 “Revenue Arrangements with Multiple Deliverables” (“ASC-605-25”). These multiple deliverable arrangements primarily consist of the following deliverables: the Company’s design, configuration, installation, integration, warranty/maintenance and consulting services; and third-party computer hardware, software and warranty maintenance services. In situations where the Company bundles all or a portion of the separate elements, Vendor Specific Objective Evidence (“VSOE”) is determined based on prices when sold separately. For the three months ended March 31, 2017 and 2016 revenues recognized as a result of customer contracts requiring the delivery of multiple elements were $3.1 million and $5.3 million, respectively. Hardware, Software and Licensing Revenue Recognition Generally, the Revenue Recognition Criteria are met with respect to the sales of hardware and software products when they are shipped to the customer. The delivery of products to our customers occurs in a variety of ways, including (i) as a physical product shipped from the Company’s warehouse, (ii) via drop-shipment by a third-party vendor, or (iii) via electronic delivery with respect to software licenses. The Company leverages drop-ship arrangements with many of its vendors and suppliers to deliver products to customers without having to physically hold the inventory at its warehouse. In such arrangements, the Company negotiates the sale price with the customer, pays the supplier directly for the product shipped, bears credit risk of collecting payment from its customers and is ultimately responsible for the acceptability of the product and ensuring that such product meets the standards and requirements of the customer. As a result, the Company recognizes the sale of the product and the cost of such upon receiving notification from the supplier that the product has shipped. Vendor rebates and price protection are recorded when earned as a reduction to cost of sales or merchandise inventory, as applicable. Vendor product price discounts are recorded when earned as a reduction to cost of sales. Maintenance and Professional Services Revenue Recognition With respect to sales of our maintenance, consulting and other service agreements including our digital advertising and electronic services, the Revenue Recognition Criteria is met once the service has been provided. Revenue on time and material contracts is recognized based on a fixed hourly rate as direct labor hours are expended. The fixed rate includes direct labor, indirect expenses, and profits. Materials, or other specified direct costs, are reimbursed as actual costs and may include markup. Anticipated losses are recognized as soon as they become known. For the three months ended March 31, 2017 and 2016, the Company did not incur any such losses. These amounts are based on known and estimated factors. Revenues from time and material or firm fixed price long-term and short-term contracts are derived principally with various United States government agencies and commercial customers. The Company recognizes revenue for sales of all services billed as a fixed fee ratably over the term of the arrangement as such services are provided. Billings for such services that are made in advance of the related revenue recognized are recorded as deferred revenue and recognized as revenue ratably over the billing coverage period. Amounts received as prepayments for services to be rendered are recognized as deferred revenue. Revenue from such prepayments is recognized when the services are provided. The Company’s storage and computing maintenance services agreements permit customers to obtain technical support from the Company and/or the manufacturer and to update, at no additional cost, to the latest technology when new software updates are introduced when and if available during the period that the maintenance agreement is in effect. Since the Company assumes certain responsibility for product staging, configuration, installation, modification, and integration with other client systems, or retains general inventory risk upon customer return or rejection and is most familiar with the customer and its required specifications, it generally serves as the initial contact with the customer with respect to any storage and computing maintenance services required and therefore will perform all or part of the required service. Typically, the Company sells maintenance contracts for a separate fee with initial contractual periods ranging from one to three years with renewal for additional periods thereafter. The Company generally bills maintenance fees in advance and records the amounts received as deferred revenue with respect to any portion of the fee for which services have not yet been provided. The Company recognizes the related revenue ratably over the term of the maintenance agreement as services are provided. In situations where the Company bundles all or a portion of the maintenance fee with products, VSOE for maintenance is determined based on prices when sold separately. Customers that have purchased maintenance/warranty services have a right to cancel and receive a refund of the amounts paid for unused services at any time during the service period upon advance written notice to the Company. Cancellation and refund privileges with respect to maintenance/warranty services lapse as to any period during the term of the agreement for which such services have already been provided. Customers do not have the right to a refund of paid fees for maintenance/warranty services that the Company has earned and recognized as revenue. Invoices issued for maintenance/warranty services not yet rendered are recorded as deferred revenue and then recognized as revenue ratably over the service period. As a result, (1) the warranty and maintenance service fees payable by each customer are separately accounted for in each customer purchase order as a separate line item, and (2) upon the Company’s receipt and acceptance of a request for refund of maintenance/warranty services not yet provided, the Company’s obligation to perform any additional maintenance/warranty services will end. Sales are recorded net of discounts and returns. Stock-Based Compensation The Company accounts for options granted to employees by measuring the cost of services received in exchange for the award of equity instruments based upon the fair value of the award on the date of grant. The fair value of that award is then ratably recognized as expense over the period during which the recipient is required to provide services in exchange for that award. Options and warrants granted to consultants and other non-employees are recorded at fair value as of the grant date and subsequently adjusted to fair value at the end of each reporting period until such options and warrants vest, and the fair value of such instruments, as adjusted, is expensed over the related vesting period. The Company incurred stock-based compensation charges, net of estimated forfeitures of $283,000 and $364,000 for the three months ended March 31, 2017 and 2016, respectively, which is included in general and administrative expenses. The following table summarizes the nature of such charges for the periods then ended (in thousands): For the Three Months Ended March 31, 2017 2016 Compensation and related benefits $ 262 $ 338 Professional and legal fees 14 26 Acquisition transaction costs 7 -- Totals $ 283 $ 364 Net Loss Per Share The Company computes basic and diluted earnings per share by dividing net loss by the weighted average number of common shares outstanding during the period. Basic and diluted net loss per common share were the same since the inclusion of common shares issuable pursuant to the exercise of options and warrants in the calculation of diluted net loss per common shares would have been anti-dilutive. The following table summarizes the number of common shares and common share equivalents excluded from the calculation of diluted net loss per common share for the three months ended March 31, 2017 and 2016: For the Three Months Ended 2017 2016 Options 381,330 321,141 Warrants 287,417 37,417 Shares accrued but not issued 1,000 122,800 Convertible preferred stock 100,000 -- Convertible debenture 253,333 -- Totals 1,023,080 481,358 Preferred Stock The Company applies the accounting standards for distinguishing liabilities from equity under GAAP when determining the classification and measurement of its convertible preferred stock. Preferred shares subject to mandatory redemption are classified as liability instruments and are measured at fair value. Conditionally redeemable preferred shares (including preferred shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) are classified as temporary equity. At all other times, preferred shares are classified as permanent equity. Reclassification Certain accounts in the prior year’s financial statements have been reclassified for comparative purposes to conform to the presentation in the current year’s financial statements. These reclassifications have no effect on previously reported earnings. Derivative Liabilities During the year ended December 31, 2016, the Company issued a convertible debenture that included reset provisions considered to be down-round protection. In addition, the Company issued warrants that include a fundamental transaction clause which provide for the warrant holders to be paid in cash the fair value of the warrants as computed under a black scholes valuation model. The Company determined that the conversion feature and warrants are derivative instruments pursuant to ASC 815 “Derivatives and Hedging” issued by the Financial Accounting Standards Board (“FASB”). The accounting treatment of derivative financial instruments requires that the Company bifurcate the conversion feature and record it as a liability at fair value and the fair value of the warrants were computed as defined in the agreement. The instruments are marked-to-market at fair value as of each balance sheet date. Any change in fair value is recorded as a change in the fair value of derivative liabilities for each reporting period. The fair value of the conversion feature was determined using the Binomial Lattice model. The Company reassesses the classification at each balance sheet date. If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification. As of March 31, 2017, the fair value of the derivative liability was $154,000 and was included in accrued liabilities. Recent Accounting Standards In January 2017, the FASB issued ASU 2017-04: “Intangibles — Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment” (“ASU 2017-04”), which removes Step 2 from the goodwill impairment test. It is effective for annual and interim periods beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment test performed with a measurement date after January 1, 2017. The Company is currently evaluating the standard to determine the impact of its adoption on the consolidated financial statements. Reverse Stock Split The board of directors was authorized by the Company’s stockholders to effect a 1 for 15 reverse stock split of its issued and outstanding shares of common stock which was effective March 1, 2017. The financial statements and accompanying notes give effect to the 1 for 15 reverse stock split as if it occurred at the beginning of the first period presented. Subsequent Events The Company evaluates events and/or transactions occurring after the balance sheet date and before the issue date of the condensed consolidated financial statements to determine if any of those events and/or transactions requires adjustment to or disclosure in the consolidated financial statements.

Integrio Technologies, LLC Asse

Integrio Technologies, LLC Asset Acquisition	3 Months Ended
Integrio Technologies, LLC Asset Acquisition	Mar. 31, 2017
Integrio Technologies, LLC [Member]
Business Acquisition [Line Items]
Integrio Technologies, LLC Asset Acquisition	Note 4 - Integrio Technologies, LLC Asset Acquisition On November 14, 2016, the Company and its wholly-owned subsidiary, Sysorex Government Services, Inc. (collectively, the “Buyer”), entered into an Asset Purchase Agreement, as amended by the Amendment No. 1 to Asset Purchase Agreement (as so amended, the “Purchase Agreement”) with Integrio Technologies, LLC (“Integrio”) and Emtec Federal, LLC, a wholly-owned subsidiary of Integrio, (collectively, the “Seller”) which are in the business of providing IT integration and engineering services to customers, primarily government agencies. The transaction closed on November 21, 2016. The consideration paid for the assets included an aggregate of (A) $1,800,000 in cash, of which $1,400,000 minus certain amounts payable to creditors of the Seller were paid upon the closing of the acquisition and $400,000 will be paid in two annual installments of $200,000 each on the respective anniversary dates of the closing, subject to certain set offs and recoupment by Buyer; (B) 35,333 unregistered restricted shares of the Company’s voting common stock valued at $22.50 per share; (C) certain specified assumed liabilities as detailed in the purchase price table below; and (D) up to an aggregate of $1,200,000 in earnout payments, of which up to $400,000 shall be payable to the Seller per year for the three years following the closing. Inpixon acquired these assets to pursue its previously stated strategy to expand its business into the federal government sector because of the large long-term contracts that the government sector offers. Inpixon started with bidding on government contracts directly and this acquisition provided an opportunity to accelerate this expansion. In addition, the acquisition allows Inpixon to offset the revenue softening in the commercial vertical for this business segment that it experienced in 2016. The total recorded purchase price for the transaction was $2,332,000 at closing on November 21, 2016 (“Closing”) which consisted of the cash paid at Closing of $753,000, $400,000 cash that will be paid in two annual installments of $200,000 each on the respective anniversary dates of the Closing, $1,078,000 in contingent earnout payments and $101,000 representing the fair value of the stock issued at Closing. The purchase price is allocated as follows (in thousands): Assets Acquired: Cash $ 189 Accounts receivable 2,365 Other receivables 377 Prepaid assets 4,164 Fixed assets 64 Other assets 34 Customer relationships 1,873 Supplier relationships 2,985 Goodwill (A) 3,261 15,312 Liabilities Assumed: Accounts payable $ 8,341 Accrued liabilities 344 Deferred revenue 4,252 Other long term liabilities 43 12,980 Total Purchase Price $ 2,332 (A) The goodwill will be deductible for tax purposes once the contingent and assumed liabilities are settled.

Proforma Financial Information

Proforma Financial Information	3 Months Ended
Proforma Financial Information	Mar. 31, 2017
Proforma Financial Information [Abstract]
Proforma Financial Information	Note 5 – Proforma Financial Information The following unaudited proforma financial information presents the consolidated results of operations of the Company and Integrio for the three months ended March 31, 2016, as if the acquisition of Integrio had occurred on January 1, 2016 instead of November 21, 2016. The proforma information does not necessarily reflect the results of operations that would have occurred had the entities been a single company during those periods. The financial information for LightMiner was deminimis. (in thousands, except share amounts ) For the Three Months Ended March 31, 2016 Revenues $ 25,756 Net Loss Attributable to Common Shareholder $ (4,946 ) Weighted Average Number of Common Shares Outstanding, Basic and Diluted 1,708,659 Loss Per Common Share - Basic and Diluted $ (2.89 )

Related Party

Related Party	3 Months Ended
Related Party	Mar. 31, 2017
Related Party [Abstract]
Related Party	Note 6 – Related Party Due from Related Parties Non-interest bearing amounts due on demand from a related party were $666,000 as of March 31, 2017 and December 31, 2016, and consist primarily of amounts due from Sysorex Consulting, Inc. (“SCI”). Subsequent to December 31, 2014, SCI is no longer a direct shareholder or investor in the Company. The amounts due from SCI as of March 31, 2017 and December 31, 2016 have been classified in and as a reduction of stockholders’ equity. Subsequent to March 31, 2017, the Company is in negotiations with SCI for the repayment and settlement of this receivable through the purchase of Sysorex India, a wholly owned subsidiary of SCI. The Company cannot provide assurance it will be successful in the consummation of the arrangement.

Inventory

Inventory	3 Months Ended
Inventory	Mar. 31, 2017
Inventory [Abstract]
Inventory	Note 7 - Inventory Inventory at March 31, 2017 and December 31, 2016 consisted of the following (in thousands): March 31, December 31, 2016 Raw materials $ 220 $ 326 Work in process 7 238 Finished goods 555 497 Total Inventory $ 782 $ 1,061

Discontinued Operations

Discontinued Operations	3 Months Ended
Discontinued Operations	Mar. 31, 2017
Discontinued Operations [Abstract]
Discontinued Operations	Note 8 - Discontinued Operations As of December 31, 2015, the Company’s management decided to close its Saudi Arabia legal entity as business activities and operations have been strategically shifted according to the business plan of the Company. In accordance with ASC topic 360 “Property, Plant and Equipment”, the Company has classified the assets and liabilities as discontinued assets and liabilities in the accompanying consolidated financial statements. The major categories of assets and liabilities held for sale in the condensed consolidated balance sheets at March 31, 2017 and December 31, 2016 (in thousands): March 31, 2017 December 31, 2016 Assets Accounts receivable, net 1 1 Notes and other receivables 8 8 Other assets 14 14 Total Current Assets 23 23 Other assets -- -- Total Assets $ 23 $ 23 Liabilities and Stockholders’ Equity Current Liabilities Accounts payable $ 178 $ 178 Accrued liabilities 908 904 Deferred revenue 236 236 Due to related party 2 1 Short-term debt 722 722 Total Current Liabilities 2,046 2,041 Long Term Liabilities -- -- Total Liabilities $ 2,046 $ 2,041 The Company has entered into surety bonds with a financial institution in Saudi Arabia which guaranteed performance on certain contracts. Deposits for surety bonds amounted to $0 as of March 31, 2017 and December 31, 2016, as a reserve was placed against the deposit balance during the year ended December 31, 2016 due to the uncertainty of when the bond will be released. The Company did not recognize any depreciation or amortization expense related to discontinued operations during the three months ended March 31, 2017 and 2016. There were no significant capital expenditures or non-cash operating or investing activities of discontinued operations during the periods presented. The operations of Sysorex Arabia were insignificant for the three months ended March 31, 2017 and 2016. End of Service Indemnity Provision In accordance with local labor laws, Sysorex Arabia is required to accrue benefits payable to its employees at the end of their services with Sysorex Arabia. For the three months ended March 31, 2017 and 2016, no amounts were required to be accrued under this provision.

Debt

Debt	3 Months Ended
Debt	Mar. 31, 2017
Debt [Abstract]
Debt	Note 9 – Debt Debt as of March 31, 2017 and December 31, 2016 consisted of the following (in thousands): March 31, 2017 December 31, 2016 Short-Term Debt Notes payable $ 170 $ 170 Revolving line of credit (A) 4,448 6,717 Total Short-Term Debt $ 4,618 $ 6,887 Long-Term Debt Notes payable $ 212 $ 212 Senior secured convertible debenture, less debt discount of $1,570 and $1,865 4,130 3,835 Total Long-Term Debt $ 4,342 $ 4,047 (A) Revolving Lines of Credit GemCap Loan and Security Agreement Amendment 2 On January 24, 2017, the Company, and its U.S. wholly-owned subsidiaries, Inpixon USA and Inpixon Federal, entered into Amendment Number 2 to the Loan and Security Agreement to amend that certain Loan and Security Agreement and Loan Agreement Schedule, both dated as of November 14, 2016, with GemCap Lending I, LLC whereby Section (21) of the definition of “Eligible Accounts” in Section 1.29 of the Loan Agreement was deleted and restated in its entirety as follows: Accounts that satisfy the criteria set forth in the foregoing items (1) – (20), which are owed by any other single Account Debtor or its Affiliates so long as such Accounts, in the aggregate, constitute no more than twenty percent (20%) of all Eligible Accounts, provided, that only for the period commencing on January 24, 2017 through and including April 24, 2017, Accounts in the aggregate only from and owed by Centene Corporation or its Affiliates may exceed twenty percent (20%) of all Eligible Accounts by an amount not to exceed $500,000, provided, further, that, from and after April 25, 2017, Accounts in the aggregate that are owed by Centene Corporation or its Affiliates that satisfy the criteria set forth in the foregoing items (1) – (20) shall not exceed twenty percent (20%) of all Eligible Accounts; and Borrower shall have paid to Lender an accommodation fee in the amount of $5,000 on February 2, 2017.

Common Stock

Common Stock	3 Months Ended
Common Stock	Mar. 31, 2017
Common Stock [Abstract]
Common Stock	Note 10 - Common Stock During the three months ended March 31, 2017, the Company issued 1,767 shares of common stock related to the acquisition of Integrio Technologies, LLC which were fully vested upon the date of grant. The Company recorded an expense of $7,050 for the fair value of those shares. During the three months ended March 31, 2017, the Company issued 3,613 shares of common stock for services which were fully vested upon the date of grant. The Company recorded an expense of $14,092 for the fair value of those shares. During the three months ended March 31, 2017, the Company issued 18,905 of common stock for the settlement of $567,000 of shares held in escrow related to the LightMiner asset acquisition.

Stock Options

Stock Options	3 Months Ended
Stock Options	Mar. 31, 2017
Stock Options [Abstract]
Stock Options	Note 11 - Stock Options In September 2011, the Company adopted the 2011 Employee Stock Incentive Plan which provides for the granting of incentive and non-statutory common stock options and stock based incentive awards to employees, non-employee directors, consultants and independent contractors. The plan was amended and restated in May 2014. Incentive stock options are granted at exercise prices not less than 100% of the estimated fair market value of the underlying common stock at date of grant. The exercise price per share for incentive stock options may not be less than 110% of the estimated fair value of the underlying common stock on the grant date for any individual possessing more that 10% of the total outstanding common stock of the Company. Unless terminated sooner by the Board of Directors, this plan will terminate on August 31, 2021. Options granted under the Company’s plan vest over periods ranging from immediately to four years and are exercisable over periods not exceeding ten years. The aggregate number of shares that may be awarded under the Company’s plan as of December 31, 2016 is 450,402. As of March 31, 2017, 381,330 of options were granted to employees and consultants of the Company (including 41,667 shares outside of our plan) and 110,739 options were available for future grant under our plan. During the three months ended March 31, 2017, the Company granted options for the purchase of 25,627 shares of common stock to employees and directors of the Company. These options vest pro-rata over 48 months and have a life of ten years and an exercise price of $3.90 per share. The Company valued the stock options using the Black-Scholes option valuation model and the fair value of the awards was determined to be $51,000. The fair value of the common stock as of the grant date was determined to be $3.90 per share. During the three months ended March 31, 2017 and 2016, the Company recorded a charge of $283,000 and $364,000, respectively, for the amortization of employee stock options. As of March 31, 2017, the fair value of non-vested options totaled $1,993,000 which will be amortized to expense over the weighted average remaining term of 1.23 years. The fair value of each employee option grant is estimated on the date of the grant using the Black-Scholes option-pricing model. Key weighted-average assumptions used to apply this pricing model during the three months ended March 31, 2017 and 2016 were as follows: For the Three Months Ended March 31, 2017 2016 Risk-free interest rate 2.27% 1.47% Expected life of option grants 7 years 7 years Expected volatility of underlying stock 47.34% 49.02% Dividends assumption $ -- $ -- The expected stock price volatility for the Company’s stock options was determined by the historical volatilities for industry peers and used an average of those volatilities. The Company attributes the value of stock-based compensation to operations on the straight-line single option method. Risk free interest rates were obtained from U.S. Treasury rates for the applicable periods. The dividends assumptions was $0 as the Company historically has not declared any dividends and does not expect to.

Credit Risk and Concentrations

Credit Risk and Concentrations	3 Months Ended
Credit Risk and Concentrations	Mar. 31, 2017
Credit Risk and Concentrations [Abstract]
Credit Risk and Concentrations	Note 12 - Credit Risk and Concentrations Financial instruments that subject the Company to credit risk consist principally of trade accounts receivable and cash and cash equivalents. The Company performs certain credit evaluation procedures and does not require collateral for financial instruments subject to credit risk. The Company believes that credit risk is limited because the Company routinely assesses the financial strength of its customers and, based upon factors surrounding the credit risk of its customers, establishes an allowance for uncollectible accounts and, as a consequence, believes that its accounts receivable credit risk exposure beyond such allowances is limited. The Company maintains cash deposits with financial institutions, which, from time to time, may exceed federally insured limits. Cash is also maintained at foreign financial institutions for its Canadian subsidiary and its majority-owned Saudi Arabia subsidiary. Cash in foreign financial institutions as of March 31, 2017 and December 31, 2016 was immaterial. The Company has not experienced any losses and believes it is not exposed to any significant credit risk from cash. The following table sets forth the percentages of revenue derived by the Company from those customers which accounted for at least 10% of revenues during the three months ended March 31, 2017 and 2016 (in thousands): For the Three Months Ended For the Three Months Ended $ % $ % Customer A -- -- 5,209 36% Customer B 1,616 12% 1,841 13% As of March 31, 2017, Customer D represented approximately 12% of total accounts receivable. As of March 31, 2016, Customer C represented approximately 33% and Customer A represented approximately 17% of total accounts receivable. As of March 31, 2017, one vendor represented approximately 38% of total gross accounts payable. Purchases from this vendor during the three months ended March 31, 2017 were $1.0 million. As of March 31, 2016, two vendors represented approximately 38% and 10% of total gross accounts payable. Purchases from these vendors during the three months ended March 31, 2016 were $4.5 million and $0.9 million. For the three months ended March 31, 2017, three vendors represented approximately 16%, 12%, and 10% of total purchases. For the three months ended March 31, 2016, three vendors represented approximately 55%, 11% and 10% of total purchases.

Segment Reporting and Foreign O

Segment Reporting and Foreign Operations	3 Months Ended
Segment Reporting and Foreign Operations	Mar. 31, 2017
Segment Reporting and Foreign Operations [Abstract]
Segment Reporting and Foreign Operations	Note 13 - Segment Reporting and Foreign Operations Effective January 1, 2017 the Company has changed the way it analyzes and assesses divisional performance of the Company. The Company has therefore re-aligned its operating segments along those division business lines and has created the following operating segments. The Company has retroactively applied these new segment categories to the prior periods presented below for comparative purposes. ● Indoor Positioning Analytics: This segment includes Inpixon’s proprietary products and services delivered on premise or in the Cloud as well as our hosted Software-as-a-Service (SaaS) based solutions. Our Indoor Positioning Analytics product is based on a unique and patented sensor technology that detects and locates accessible cellular, Wi-Fi and Bluetooth devices and then uses a lightning fast data-analytics engine to deliver actionable insights and intelligent reports for security, marketing, asset management, etc. ● Infrastructure: This segment includes third party hardware, software and related maintenance/warranty products and services that Inpixon resells to commercial and government customers. It includes but is not limited to products for enterprise computing; storage; virtualization; networking; etc. as well as services including custom application/software design; architecture and development; staff augmentation and project management. The following tables present key financial information of the Company’s reportable segments before unallocated corporate expenses (in thousands): Indoor Positioning Analytics Infrastructure Consolidated For the Three Months Ended March 31, 2017: Net revenues $ 981 $ 12,500 $ 13,481 Cost of net revenues $ (343 ) $ (9,850 ) $ (10,193 ) Gross profit $ 638 $ 2,650 $ 3,288 Gross margin % 65 % 21 % 24 % Depreciation and amortization $ 76 $ 325 $ 401 Amortization of intangibles $ 864 $ 519 $ 1,383 For the Three Months Ended March 31, 2016: Net revenues $ 1,024 $ 13,063 $ 14,087 Cost of net revenues $ (286 ) $ (9,854 ) $ (10,140 ) Gross profit $ 738 $ 3,209 $ 3,947 Gross margin % 72 % 25 % 28 % Depreciation and amortization $ 77 $ 186 $ 263 Amortization of intangibles $ 864 $ 192 $ 1,056 For the Three Months Ended March 31, 2017 2016 Income from operations of reportable segments $ 3,288 $ 3,947 Unallocated operating expenses (8,642 ) (8,129 ) Interest expense (684 ) (143 ) Other income (expense) (9 ) 19 Loss from discontinued operations (9 ) -- Consolidated net loss $ (6,056 ) $ (4,306 ) The Company’s operations are located primarily in the United States, Canada and Saudi Arabia. Revenues by geographic area are attributed by country of domicile of our subsidiaries. The financial data by geographic area are as follows (in thousands): United Saudi States Canada Arabia Eliminations Total For the Three Months Ended March 31, 2017 Revenues by geographic area $ 13,425 $ 56 $ -- $ -- $ 13,481 Operating loss by geographic area $ (4,953 ) $ (401 ) $ -- $ -- $ (5,354 ) Net loss by geographic area $ (5,647 ) $ (401 ) $ (9 ) $ -- $ (6,056 ) For the Three Months Ended March 31, 2016 Revenues by geographic area $ 14,049 $ 38 $ -- $ -- $ 14,087 Operating loss by geographic area $ (3,790 ) $ (383 ) $ (9 ) $ -- $ (4,182 ) Net loss by geographic area $ (3,914 ) $ (383 ) $ (9 ) $ -- $ (4,306 ) As of March 31, 2017 Identifiable assets by geographic area $ 54,019 $ 535 $ 23 $ -- $ 54,577 Long lived assets by geographic area $ 28,422 $ 375 $ -- $ -- $ 28,797 As of December 31, 2016 Identifiable assets by geographic area $ 66,050 $ 400 $ 23 $ -- $ 66,473 Long lived assets by geographic area $ 29,843 $ 319 $ -- $ -- $ 30,162

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
Commitments and Contingencies	Mar. 31, 2017
Commitments and Contingencies [Abstract]
Commitments and Contingencies	Note 14 - Commitments and Contingencies Litigation Certain conditions may exist as of the date the condensed consolidated financial statements are issued which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company, or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims, as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s consolidated financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed, unless they involve guarantees, in which case the guarantees would be disclosed. There can be no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows. During the year ended December 31, 2011, a judgment in the amount of $936,000 was levied against Sysorex Arabia in favor of Creative Edge, Inc. in connection with amounts advanced for operations. Of that amount, $214,000 has been repaid, and the remaining $722,000 has been accrued and is included as a component of liabilities held for sale as of March 31, 2017 and December 31, 2016 in the condensed consolidated balance sheets.

Subsequent Events

Subsequent Events	3 Months Ended
Subsequent Events	Mar. 31, 2017
Subsequent Events [Abstract]
Subsequent Events	Note 15 - Subsequent Events On April 10, 2017, the Company issued 50,000 shares of common stock for services which were fully vested upon the date of grant. The Company recorded an expense of $141,000 for the fair value of those shares. On April 19, 2017, Inpixon entered into an exchange agreement (the “Exchange Agreement”) with Hillair Capital Investments L.P. in connection with an interest payment due on May 9, 2017 pursuant to the Company’s 8% Original Issue Discount Senior Secured Convertible Debenture in the principal amount of $5,700,000. In accordance with the Exchange Agreement, solely in respect of the interest payment in the amount of $343,267 due on May 9, 2017, the parties agreed that $315,700 of such interest payment will be made in in the form of 110,000 shares of the Company’s common stock issued at an interest conversion rate equal to $2.87 per share. The shares were issued on April 20, 2017. On May 8, 2017, Hillair Capital Investments L.P. delivered a conversion notice to the Company pursuant to which it converted 2,250 shares of the Company’s Series 1 Convertible Preferred Stock into 100,000 shares of the Company’s common stock. Such shares of common stock were issued on May 9, 2017.

Summary of Significant Accoun23

Summary of Significant Accounting Policies (Policies)	3 Months Ended
Summary of Significant Accounting Policies (Policies)	Mar. 31, 2017
Basis of Presentation/Summary of Significant Accounting Policies [Abstract]
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during each of the reporting periods. Actual results could differ from those estimates. The Company’s significant estimates consist of: ● the valuation of stock-based compensation; ● the allowance for doubtful accounts; ● the valuation allowance for the deferred tax asset; and ● impairment of long-lived assets and goodwill.
Revenue Recognition	Revenue Recognition The Company provides Information Technology solutions and services to customers and derives revenues primarily from the sale of third-party hardware and software products, software, assurance, licenses and other consulting services, including maintenance services and recognizes revenue once the following four criteria are met: (1) persuasive evidence of an arrangement exists; (2) the price is fixed and determinable, (3) shipment (software and hardware) or fulfillment (maintenance) has occurred,; and (4) there is reasonable assurance of collection of the sales proceeds (the “Revenue Recognition Criteria”). In addition, the Company also records revenues in accordance with Accounting Standards Codification (“ASC”) Topic 605-45 “Principal Agent Consideration” (“ASC 605-45”). The Company evaluates the sales of products and services on a case by case basis to determine whether the transaction should be recorded gross or net, including, but not limited to, assessing whether or not the Company: (1) is the primary obligor in the transaction; (2) has inventory risk with respect to the products and/or services sold; (3) has latitude in pricing; and (4) changes the product or performs part of the services sold. The Company evaluates whether revenues received from the sale of hardware and software products, licenses, and services, including maintenance and professional consulting services, should be recognized on a gross or net basis on a transaction by transaction basis. As of March 31, 2017, the Company has determined that all revenues received should be recognized on a gross basis in accordance with applicable standards. Cooperative reimbursements from vendors, which are earned and available, are recorded during the period the related transaction has occurred. Cooperative reimbursements are recorded as a reduction of cost of sales in accordance with ASC Topic 605-50 “Accounting by a Customer (including reseller) for Certain Consideration Received from a Vendor.” Provisions for returns are estimated based on historical collections and credit memo analysis for the period. The Company receives Marketing Development Funds from vendors based on quarterly or annual sales performance to promote the marketing of vendor products and services. The Company must file claims with vendors for these cooperative reimbursements by providing invoices and receipts for marketing expenses. Reimbursements are recorded as a reduction of marketing expenses and other applicable selling, general and administrative expenses ratably over the period in which the expenses are expected to occur. The Company receives vendor rebates which are recorded to cost of sales. The Company also enters into sales transactions whereby customer orders contain multiple deliverables, and reports its multiple deliverable arrangements under ASC 605-25 “Revenue Arrangements with Multiple Deliverables” (“ASC-605-25”). These multiple deliverable arrangements primarily consist of the following deliverables: the Company’s design, configuration, installation, integration, warranty/maintenance and consulting services; and third-party computer hardware, software and warranty maintenance services. In situations where the Company bundles all or a portion of the separate elements, Vendor Specific Objective Evidence (“VSOE”) is determined based on prices when sold separately. For the three months ended March 31, 2017 and 2016 revenues recognized as a result of customer contracts requiring the delivery of multiple elements were $3.1 million and $5.3 million, respectively. Hardware, Software and Licensing Revenue Recognition Generally, the Revenue Recognition Criteria are met with respect to the sales of hardware and software products when they are shipped to the customer. The delivery of products to our customers occurs in a variety of ways, including (i) as a physical product shipped from the Company’s warehouse, (ii) via drop-shipment by a third-party vendor, or (iii) via electronic delivery with respect to software licenses. The Company leverages drop-ship arrangements with many of its vendors and suppliers to deliver products to customers without having to physically hold the inventory at its warehouse. In such arrangements, the Company negotiates the sale price with the customer, pays the supplier directly for the product shipped, bears credit risk of collecting payment from its customers and is ultimately responsible for the acceptability of the product and ensuring that such product meets the standards and requirements of the customer. As a result, the Company recognizes the sale of the product and the cost of such upon receiving notification from the supplier that the product has shipped. Vendor rebates and price protection are recorded when earned as a reduction to cost of sales or merchandise inventory, as applicable. Vendor product price discounts are recorded when earned as a reduction to cost of sales. Maintenance and Professional Services Revenue Recognition With respect to sales of our maintenance, consulting and other service agreements including our digital advertising and electronic services, the Revenue Recognition Criteria is met once the service has been provided. Revenue on time and material contracts is recognized based on a fixed hourly rate as direct labor hours are expended. The fixed rate includes direct labor, indirect expenses, and profits. Materials, or other specified direct costs, are reimbursed as actual costs and may include markup. Anticipated losses are recognized as soon as they become known. For the three months ended March 31, 2017 and 2016, the Company did not incur any such losses. These amounts are based on known and estimated factors. Revenues from time and material or firm fixed price long-term and short-term contracts are derived principally with various United States government agencies and commercial customers. The Company recognizes revenue for sales of all services billed as a fixed fee ratably over the term of the arrangement as such services are provided. Billings for such services that are made in advance of the related revenue recognized are recorded as deferred revenue and recognized as revenue ratably over the billing coverage period. Amounts received as prepayments for services to be rendered are recognized as deferred revenue. Revenue from such prepayments is recognized when the services are provided. The Company’s storage and computing maintenance services agreements permit customers to obtain technical support from the Company and/or the manufacturer and to update, at no additional cost, to the latest technology when new software updates are introduced when and if available during the period that the maintenance agreement is in effect. Since the Company assumes certain responsibility for product staging, configuration, installation, modification, and integration with other client systems, or retains general inventory risk upon customer return or rejection and is most familiar with the customer and its required specifications, it generally serves as the initial contact with the customer with respect to any storage and computing maintenance services required and therefore will perform all or part of the required service. Typically, the Company sells maintenance contracts for a separate fee with initial contractual periods ranging from one to three years with renewal for additional periods thereafter. The Company generally bills maintenance fees in advance and records the amounts received as deferred revenue with respect to any portion of the fee for which services have not yet been provided. The Company recognizes the related revenue ratably over the term of the maintenance agreement as services are provided. In situations where the Company bundles all or a portion of the maintenance fee with products, VSOE for maintenance is determined based on prices when sold separately. Customers that have purchased maintenance/warranty services have a right to cancel and receive a refund of the amounts paid for unused services at any time during the service period upon advance written notice to the Company. Cancellation and refund privileges with respect to maintenance/warranty services lapse as to any period during the term of the agreement for which such services have already been provided. Customers do not have the right to a refund of paid fees for maintenance/warranty services that the Company has earned and recognized as revenue. Invoices issued for maintenance/warranty services not yet rendered are recorded as deferred revenue and then recognized as revenue ratably over the service period. As a result, (1) the warranty and maintenance service fees payable by each customer are separately accounted for in each customer purchase order as a separate line item, and (2) upon the Company’s receipt and acceptance of a request for refund of maintenance/warranty services not yet provided, the Company’s obligation to perform any additional maintenance/warranty services will end. Sales are recorded net of discounts and returns.
Stock-Based Compensation	Stock-Based Compensation The Company accounts for options granted to employees by measuring the cost of services received in exchange for the award of equity instruments based upon the fair value of the award on the date of grant. The fair value of that award is then ratably recognized as expense over the period during which the recipient is required to provide services in exchange for that award. Options and warrants granted to consultants and other non-employees are recorded at fair value as of the grant date and subsequently adjusted to fair value at the end of each reporting period until such options and warrants vest, and the fair value of such instruments, as adjusted, is expensed over the related vesting period. The Company incurred stock-based compensation charges, net of estimated forfeitures of $283,000 and $364,000 for the three months ended March 31, 2017 and 2016, respectively, which is included in general and administrative expenses. The following table summarizes the nature of such charges for the periods then ended (in thousands): For the Three Months Ended March 31, 2017 2016 Compensation and related benefits $ 262 $ 338 Professional and legal fees 14 26 Acquisition transaction costs 7 -- Totals $ 283 $ 364
Net Loss Per Share	Net Loss Per Share The Company computes basic and diluted earnings per share by dividing net loss by the weighted average number of common shares outstanding during the period. Basic and diluted net loss per common share were the same since the inclusion of common shares issuable pursuant to the exercise of options and warrants in the calculation of diluted net loss per common shares would have been anti-dilutive. The following table summarizes the number of common shares and common share equivalents excluded from the calculation of diluted net loss per common share for the three months ended March 31, 2017 and 2016: For the Three Months Ended 2017 2016 Options 381,330 321,141 Warrants 287,417 37,417 Shares accrued but not issued 1,000 122,800 Convertible preferred stock 100,000 -- Convertible debenture 253,333 -- Totals 1,023,080 481,358
Preferred Stock	Preferred Stock The Company applies the accounting standards for distinguishing liabilities from equity under GAAP when determining the classification and measurement of its convertible preferred stock. Preferred shares subject to mandatory redemption are classified as liability instruments and are measured at fair value. Conditionally redeemable preferred shares (including preferred shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) are classified as temporary equity. At all other times, preferred shares are classified as permanent equity.
Reclassification	Reclassification Certain accounts in the prior year’s financial statements have been reclassified for comparative purposes to conform to the presentation in the current year’s financial statements. These reclassifications have no effect on previously reported earnings.
Derivative Liabilities	Derivative Liabilities During the year ended December 31, 2016, the Company issued a convertible debenture that included reset provisions considered to be down-round protection. In addition, the Company issued warrants that include a fundamental transaction clause which provide for the warrant holders to be paid in cash the fair value of the warrants as computed under a black scholes valuation model. The Company determined that the conversion feature and warrants are derivative instruments pursuant to ASC 815 “Derivatives and Hedging” issued by the Financial Accounting Standards Board (“FASB”). The accounting treatment of derivative financial instruments requires that the Company bifurcate the conversion feature and record it as a liability at fair value and the fair value of the warrants were computed as defined in the agreement. The instruments are marked-to-market at fair value as of each balance sheet date. Any change in fair value is recorded as a change in the fair value of derivative liabilities for each reporting period. The fair value of the conversion feature was determined using the Binomial Lattice model. The Company reassesses the classification at each balance sheet date. If the classification changes as a result of events during the period, the contract is reclassified as of the date of the event that caused the reclassification. As of March 31, 2017, the fair value of the derivative liability was $154,000 and was included in accrued liabilities.
Recent Accounting Standards	Recent Accounting Standards In January 2017, the FASB issued ASU 2017-04: “Intangibles — Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment” (“ASU 2017-04”), which removes Step 2 from the goodwill impairment test. It is effective for annual and interim periods beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment test performed with a measurement date after January 1, 2017. The Company is currently evaluating the standard to determine the impact of its adoption on the consolidated financial statements.
Reverse Stock Split	Reverse Stock Split The board of directors was authorized by the Company’s stockholders to effect a 1 for 15 reverse stock split of its issued and outstanding shares of common stock which was effective March 1, 2017. The financial statements and accompanying notes give effect to the 1 for 15 reverse stock split as if it occurred at the beginning of the first period presented.
Subsequent Events	Subsequent Events The Company evaluates events and/or transactions occurring after the balance sheet date and before the issue date of the condensed consolidated financial statements to determine if any of those events and/or transactions requires adjustment to or disclosure in the consolidated financial statements.

Summary of Significant Accoun24

Summary of Significant Accounting Policies (Tables)	3 Months Ended
Summary of Significant Accounting Policies (Tables)	Mar. 31, 2017
Basis of Presentation/Summary of Significant Accounting Policies [Abstract]
Schedule of stock-based compensation charges	For the Three Months Ended March 31, 2017 2016 Compensation and related benefits $ 262 $ 338 Professional and legal fees 14 26 Acquisition transaction costs 7 -- Totals $ 283 $ 364
Schedule of number of common shares and common share equivalents excluded from the calculation of diluted net loss per common share	The following table summarizes the number of common shares and common share equivalents excluded from the calculation of diluted net loss per common share for the three months ended March 31, 2017 and 2016: For the Three Months Ended 2017 2016 Options 381,330 321,141 Warrants 287,417 37,417 Shares accrued but not issued 1,000 122,800 Convertible preferred stock 100,000 -- Convertible debenture 253,333 -- Totals 1,023,080 481,358

Integrio Technologies, LLC As25

Integrio Technologies, LLC Asset Acquisition (Tables)	3 Months Ended
Integrio Technologies, LLC Asset Acquisition (Tables)	Mar. 31, 2017
Integrio Technologies, LLC [Member]
Business Acquisition [Line Items]
Schedule of assets acquired	Assets Acquired: Cash $ 189 Accounts receivable 2,365 Other receivables 377 Prepaid assets 4,164 Fixed assets 64 Other assets 34 Customer relationships 1,873 Supplier relationships 2,985 Goodwill (A) 3,261 15,312 Liabilities Assumed: Accounts payable $ 8,341 Accrued liabilities 344 Deferred revenue 4,252 Other long term liabilities 43 12,980 Total Purchase Price $ 2,332 (A) The goodwill will be deductible for tax purposes once the contingent and assumed liabilities are settled.

Proforma Financial Information

Proforma Financial Information (Tables)	3 Months Ended
Proforma Financial Information (Tables)	Mar. 31, 2017
Proforma Financial Information [Abstract]
Schedule of proforma financial information	(in thousands, except share amounts ) For the Three Months Ended March 31, 2016 Revenues $ 25,756 Net Loss Attributable to Common Shareholder $ (4,946 ) Weighted Average Number of Common Shares Outstanding, Basic and Diluted 1,708,659 Loss Per Common Share - Basic and Diluted $ (2.89 )

Inventory (Tables)

Inventory (Tables)	3 Months Ended
Inventory (Tables)	Mar. 31, 2017
Inventory [Abstract]
Schedule of inventory	March 31, December 31, 2016 Raw materials $ 220 $ 326 Work in process 7 238 Finished goods 555 497 Total Inventory $ 782 $ 1,061

Discontinued Operations (Tables

Discontinued Operations (Tables)	3 Months Ended
Discontinued Operations (Tables)	Mar. 31, 2017
Discontinued Operations [Abstract]
Schedule of major categories of discontinued assets and liabilities	March 31, 2017 December 31, 2016 Assets Accounts receivable, net 1 1 Notes and other receivables 8 8 Other assets 14 14 Total Current Assets 23 23 Other assets -- -- Total Assets $ 23 $ 23 Liabilities and Stockholders’ Equity Current Liabilities Accounts payable $ 178 $ 178 Accrued liabilities 908 904 Deferred revenue 236 236 Due to related party 2 1 Short-term debt 722 722 Total Current Liabilities 2,046 2,041 Long Term Liabilities -- -- Total Liabilities $ 2,046 $ 2,041

Debt (Tables)

Debt (Tables)	3 Months Ended
Debt (Tables)	Mar. 31, 2017
Debt [Abstract]
Schedule of debt	Debt as of March 31, 2017 and December 31, 2016 consisted of the following (in thousands): March 31, 2017 December 31, 2016 Short-Term Debt Notes payable $ 170 $ 170 Revolving line of credit (A) 4,448 6,717 Total Short-Term Debt $ 4,618 $ 6,887 Long-Term Debt Notes payable $ 212 $ 212 Senior secured convertible debenture, less debt discount of $1,570 and $1,865 4,130 3,835 Total Long-Term Debt $ 4,342 $ 4,047 (A) Revolving Lines of Credit

Stock Options (Tables)

Stock Options (Tables)	3 Months Ended
Stock Options (Tables)	Mar. 31, 2017
Stock Options [Abstract]
Schedule of weighted-average assumptions Black-Scholes option-pricing model	For the Three Months Ended March 31, 2017 2016 Risk-free interest rate 2.27% 1.47% Expected life of option grants 7 years 7 years Expected volatility of underlying stock 47.34% 49.02% Dividends assumption $ -- $ --

Credit Risk and Concentrations

Credit Risk and Concentrations (Tables)	3 Months Ended
Credit Risk and Concentrations (Tables)	Mar. 31, 2017
Credit Risk and Concentrations [Abstract]
Schedule of risk percentage of revenue from customers	For the Three Months Ended For the Three Months Ended $ % $ % Customer A -- -- 5,209 36% Customer B 1,616 12% 1,841 13%

Segment Reporting and Foreign32

Segment Reporting and Foreign Operations (Tables)	3 Months Ended
Segment Reporting and Foreign Operations (Tables)	Mar. 31, 2017
Segment Reporting and Foreign Operations [Abstract]
Schedule of financial data by business segment	Indoor Positioning Analytics Infrastructure Consolidated For the Three Months Ended March 31, 2017: Net revenues $ 981 $ 12,500 $ 13,481 Cost of net revenues $ (343 ) $ (9,850 ) $ (10,193 ) Gross profit $ 638 $ 2,650 $ 3,288 Gross margin % 65 % 21 % 24 % Depreciation and amortization $ 76 $ 325 $ 401 Amortization of intangibles $ 864 $ 519 $ 1,383 For the Three Months Ended March 31, 2016: Net revenues $ 1,024 $ 13,063 $ 14,087 Cost of net revenues $ (286 ) $ (9,854 ) $ (10,140 ) Gross profit $ 738 $ 3,209 $ 3,947 Gross margin % 72 % 25 % 28 % Depreciation and amortization $ 77 $ 186 $ 263 Amortization of intangibles $ 864 $ 192 $ 1,056
Schedule of reconciliation of reportable segments' combined income from operations to the consolidated loss before income taxes	For the Three Months Ended March 31, 2017 2016 Income from operations of reportable segments $ 3,288 $ 3,947 Unallocated operating expenses (8,642 ) (8,129 ) Interest expense (684 ) (143 ) Other income (expense) (9 ) 19 Loss from discontinued operations (9 ) -- Consolidated net loss $ (6,056 ) $ (4,306 )
Schedule of financial data by geographic area	United Saudi States Canada Arabia Eliminations Total For the Three Months Ended March 31, 2017 Revenues by geographic area $ 13,425 $ 56 $ -- $ -- $ 13,481 Operating loss by geographic area $ (4,953 ) $ (401 ) $ -- $ -- $ (5,354 ) Net loss by geographic area $ (5,647 ) $ (401 ) $ (9 ) $ -- $ (6,056 ) For the Three Months Ended March 31, 2016 Revenues by geographic area $ 14,049 $ 38 $ -- $ -- $ 14,087 Operating loss by geographic area $ (3,790 ) $ (383 ) $ (9 ) $ -- $ (4,182 ) Net loss by geographic area $ (3,914 ) $ (383 ) $ (9 ) $ -- $ (4,306 ) As of March 31, 2017 Identifiable assets by geographic area $ 54,019 $ 535 $ 23 $ -- $ 54,577 Long lived assets by geographic area $ 28,422 $ 375 $ -- $ -- $ 28,797 As of December 31, 2016 Identifiable assets by geographic area $ 66,050 $ 400 $ 23 $ -- $ 66,473 Long lived assets by geographic area $ 29,843 $ 319 $ -- $ -- $ 30,162

Organization and Nature of Bu33

Organization and Nature of Business and Going Concern (Details) - USD ($) $ in Thousands	Aug. 09, 2016	Mar. 31, 2017	Sep. 30, 2016	Mar. 31, 2016
Organization and Nature of Business and Going Concern (Textual)
Working capital deficiency		$ 25,300
Net loss		(6,056)		$ (4,306)
S-3 Market capitalization ceiling		75,000
Credit facility, maximum borrowing capacity	$ 10,000	10,000
Credit facility, maturity date	Nov. 14, 2018
Line of credit facility utilized	$ 4,400	$ 4,400
Reduction in operating expenses on an annual basis			$ 1,800
Hillair Capital Investments L.P. [Member]
Organization and Nature of Business and Going Concern (Textual)
Securities purchase agreement, description	(i) an 8% Original Issue Discount Senior Convertible Debenture in an aggregate principal amount of $5,700,000 due on August 9, 2018 and (ii) 2,250 shares of newly created Series 1 Convertible Preferred Stock, par value $0.001 per share (the "Preferred Stock", together with the Debenture, the "Securities"), for an aggregate purchase price of $5,000,000 (the "Transaction").

Summary of Significant Accoun34

Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Stock-based compensation charges
Compensation and related benefits	$ 262	$ 338
Professional and legal fees	14	26
Acquisition transaction costs	7
Totals	$ 283	$ 364

Summary of Significant Accoun35

Summary of Significant Accounting Policies (Details 1) - shares	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Totals	1,023,080	481,358
Options [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Totals	381,330	321,141
Warrants [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Totals	287,417	37,417
Shares accrued but not issued [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Totals	1,000	122,800
Convertible preferred stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Totals	100,000
Convertible debenture [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Totals	253,333

Summary of Significant Accoun36

Summary of Significant Accounting Policies (Details Textual) - USD ($)	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Summary of Significant Accounting Policies (Textual)
Revenues	$ 13,481,000	$ 14,087,000
Stock-based compensation	283,000	364,000
Fair value of the derivative liability	$ 154,000
Reverse stock split, Description	The board of directors was authorized by the Company's stockholders to effect a 1 for 15 reverse stock split of its issued and outstanding shares of common stock which was effective March 1, 2017. The financial statements and accompanying notes give effect to the 1 for 15 reverse stock split as if it occurred at the beginning of the first period presented.
Multiple deliverable elements [Member]
Summary of Significant Accounting Policies (Textual)
Revenues	$ 3,100,000	$ 5,300,000

Integrio Technologies, LLC As37

Integrio Technologies, LLC Asset Acquisition (Details) - Integrio Technologies, LLC [Member] $ in Thousands	Mar. 31, 2017USD ($)
Assets Acquired:
Cash	$ 189
Accounts receivable	2,365
Other receivables	377
Prepaid assets	4,164
Fixed assets	64
Other assets	34
Customer relationships	1,873
Supplier relationships	2,985
Goodwill (A)	3,261	[1]
Asset Acquired Total	15,312
Liabilities Assumed:
Accounts payable	8,341
Accrued liabilities	344
Deferred revenue	4,252
Other long term liabilities	43
Liabilities Assumed Total	12,980
Total Purchase Price	$ 2,332

[1]	The goodwill will be deductible for tax purposes once the contingent and assumed liabilities are settled.

Integrio Technologies, LLC As38

Integrio Technologies, LLC Asset Acquisition (Details Textual) - Integrio Technologies, LLC [Member] - USD ($)	Nov. 14, 2016	Mar. 31, 2017
Integrio Technologies, LLC Asset Acquisition (Textual)
Total purchase price of acquisition		$ 2,332,000
Cash paid to acquire company		753,000
Value of common shares issued for acquisition		$ 101,000
Purchase price of transaction, Description		The total recorded purchase price for the transaction was $2,332,000 at closing on November 21, 2016 ("Closing") which consisted of the cash paid at Closing of $753,000, $400,000 cash that will be paid in two annual installments of $200,000 each on the respective anniversary dates of the Closing, $1,078,000 in contingent earnout payments and $101,000 representing the fair value of the stock issued at Closing.
Asset Purchase Agreement [Member]
Integrio Technologies, LLC Asset Acquisition (Textual)
Asset purchase agreement, description	The consideration paid for the assets included an aggregate of (A) $1,800,000 in cash, of which $1,400,000 minus certain amounts payable to creditors of the Seller were paid upon the closing of the Acquisition (the "Closing") and $400,000 will be paid in two annual installments of $200,000 each on the respective anniversary dates of the Closing, subject to certain set offs and recoupment by Buyer; (B) 35,333 unregistered restricted shares of the Company's voting common stock valued at $22.50 per share; (C) certain specified assumed liabilities as detailed in the purchase price table below; and (D) up to an aggregate of $1,200,000 in earnout payments, of which up to $400,000 shall be payable to the Seller per year for the three years following the Closing.

Proforma Financial Informatio39

Proforma Financial Information (Details) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2016USD ($)$ / sharesshares
Proforma Financial Information [Abstract]
Revenues	$ 25,756
Net Loss Attributable to Common Shareholder	$ (4,946)
Weighted Average Number of Common Shares Outstanding, Basic and Diluted \| shares	1,708,659
Loss Per Common Share - Basic and Diluted \| $ / shares	$ (2.89)

Related Party (Details)

Related Party (Details) - USD ($)	Mar. 31, 2017	Dec. 31, 2016
Related Party (Textual)
Due from Sysorex Consulting Inc.	$ 666,000	$ 666,000

Inventory (Details)

Inventory (Details) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Inventory [Abstract]
Raw materials	$ 220	$ 326
Work in process	7	238
Finished goods	555	497
Total Inventory	$ 782	$ 1,061

Discontinued Operations (Detail

Discontinued Operations (Details) - USD ($) $ in Thousands	Mar. 31, 2017	Dec. 31, 2016
Assets
Accounts receivable, net	$ 1	$ 1
Notes and other receivables	8	8
Other assets	14	14
Total Current Assets	23	23
Other assets
Total Assets	23	23
Current Liabilities
Accounts payable	178	178
Accrued liabilities	908	904
Deferred revenue	236	236
Due to related party	2	1
Short-term debt	722	722
Total Current Liabilities	2,046	2,041
Long Term Liabilities
Total Liabilities	$ 2,046	$ 2,041

Discontinued Operations (Deta43

Discontinued Operations (Details Textual) - USD ($)	Mar. 31, 2017	Dec. 31, 2016
Discontinued Operations (Textual)
Deposits for surety bonds	$ 0	$ 0

Debt (Details)

Debt (Details) - USD ($) $ in Thousands		Mar. 31, 2017	Dec. 31, 2016
Short-Term Debt
Notes payable		$ 170	$ 170
Revolving line of credit (A)	[1]	4,448	6,717
Total Short-Term Debt		4,618	6,887
Long-Term Debt
Notes payable		212	212
Senior secured convertible debenture, less debt discount of $1,570 and $1,865		4,130	3,835
Total Long-Term Debt		$ 4,342	$ 4,047

[1]	(A) Revolving Lines of Credit GemCap Loan and Security Agreement Amendment 2 On January 24, 2017, the Company, and its U.S. wholly-owned subsidiaries, Inpixon USA and Inpixon Federal, entered into Amendment Number 2 to the Loan and Security Agreement to amend that certain Loan and Security Agreement and Loan Agreement Schedule, both dated as of November 14, 2016, with GemCap Lending I, LLC whereby Section (21) of the definition of "Eligible Accounts" in Section 1.29 of the Loan Agreement was deleted and restated in its entirety as follows: Accounts that satisfy the criteria set forth in the foregoing items (1) (20), which are owed by any other single Account Debtor or its Affiliates so long as such Accounts, in the aggregate, constitute no more than twenty percent (20%) of all Eligible Accounts, provided, that only for the period commencing on January 24, 2017 through and including April 24, 2017, Accounts in the aggregate only from and owed by Centene Corporation or its Affiliates may exceed twenty percent (20%) of all Eligible Accounts by an amount not to exceed $500,000, provided, further, that, from and after April 25, 2017, Accounts in the aggregate that are owed by Centene Corporation or its Affiliates that satisfy the criteria set forth in the foregoing items (1) (20) shall not exceed twenty percent (20%) of all Eligible Accounts; and Borrower shall have paid to Lender an accommodation fee in the amount of $5,000 on February 2, 2017.

Debt (Details Textual)

Debt (Details Textual) - USD ($) $ in Thousands	1 Months Ended
Debt (Details Textual) - USD ($) $ in Thousands	Jan. 24, 2017	Mar. 31, 2017	Dec. 31, 2016
Debt (Textual)
Debt discount		$ 1,570	$ 1,865
Loan and Security Agreement [Member] \| Amendment Number Two [Member]
Debt (Textual)
Description of loan amendment	The Loan Agreement was deleted and restated in its entirety as follows: Accounts that satisfy the criteria set forth in the foregoing items (1) (20), which are owed by any other single Account Debtor or its Affiliates so long as such Accounts, in the aggregate, constitute no more than twenty percent (20%) of all Eligible Accounts, provided, that only for the period commencing on January 24, 2017 through and including April 24, 2017, Accounts in the aggregate only from and owed by Centene Corporation or its Affiliates may exceed twenty percent (20%) of all Eligible Accounts by an amount not to exceed $500,000, provided, further, that, from and after April 25, 2017, Accounts in the aggregate that are owed by Centene Corporation or its Affiliates that satisfy the criteria set forth in the foregoing items (1) (20) shall not exceed twenty percent (20%) of all Eligible Accounts; and Borrower shall have paid to Lender an accommodation fee in the amount of $5,000 on February 2, 2017.

Common Stock (Details)

Common Stock (Details)	3 Months Ended
Common Stock (Details)	Mar. 31, 2017USD ($)shares
Common Stock (Textual)
Common shares issued for services, shares \| shares	3,613
Fair value of shares issued for services \| $	$ 14,092
Issuance of common stock under Lightminer acquisition remain in escrow, shares \| shares	18,905
Issuance of common stock under Lightminer acquisition remain in escrow \| $	$ 567,000
Integrio Technologies, LLC [Member]
Common Stock (Textual)
Issuance of common stock share for acquisition \| shares	1,767
Issuance of common stock value for acquisition \| $	$ 7,050

Stock Options (Details)

Stock Options (Details) - USD ($)	3 Months Ended
Stock Options (Details) - USD ($)	Mar. 31, 2017	Mar. 31, 2016
Schedule of weighted-average assumptions Black-Scholes option-pricing model
Risk-free interest rate	2.27%	1.47%
Expected life of option grants	7 years	7 years
Expected volatility of underlying stock	47.34%	49.02%
Dividends assumption

Stock Options (Details Textual)

Stock Options (Details Textual) - USD ($)	Sep. 11, 2011	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options exercise price as a % of FMV of underlying common stock	100.00%
Options exercise price as a % of FMV of underlying common stock for a individual owning 10% or more of Company	110.00%
Fair value of non-vested options		$ 1,993,000
Dividends assumption
Weighted average remaining term of non-vested options		1 year 2 months 23 days
Options granted to outside shares		41,667
Stock options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Amortization of employee stock options		$ 283,000	$ 364,000
Employees and directors [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total options granted at end of period		25,627
Options vest pro-rata		48 months
Option grant life		10 years
Options exercise price		$ 3.90
Fair value of options granted		$ 51,000
Fair value of the stock option as of grant date		$ 3.90
Employees and Consultants [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total options granted at end of period		381,330
Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate number of shares available to be awarded on the company stock option plan				450,402
Options available for future grant		110,739

Credit Risk and Concentration49

Credit Risk and Concentrations (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Concentration Risk [Line Items]
Net revenues	$ 13,481	$ 14,087
Customer concentration risk [Member] \| Customer A [Member]
Concentration Risk [Line Items]
Net revenues		$ 5,209
Concentration risk, percentage		36.00%
Customer concentration risk [Member] \| Customer B [Member]
Concentration Risk [Line Items]
Net revenues	$ 1,616	$ 1,841
Concentration risk, percentage	12.00%	13.00%

Credit Risk and Concentration50

Credit Risk and Concentrations (Details Textual) $ in Millions	3 Months Ended
	Mar. 31, 2017USD ($)Vendor	Mar. 31, 2016USD ($)Vendor
Credit Risk and Concentrations (Textual)
Number of vendors \| Vendor	3	3
Vendor One [Member]
Credit Risk and Concentrations (Textual)
Concentration risk, percentage	16.00%	55.00%
Vendor Two [Member]
Credit Risk and Concentrations (Textual)
Concentration risk, percentage	12.00%	11.00%
Vendor Three [Member]
Credit Risk and Concentrations (Textual)
Concentration risk, percentage	10.00%	10.00%
Accounts payable [Member]
Credit Risk and Concentrations (Textual)
Number of vendors \| Vendor	1	2
Accounts payable [Member] \| Vendor One [Member]
Credit Risk and Concentrations (Textual)
Concentration risk, percentage	38.00%	38.00%
Purchases from vendors \| $	$ 1	$ 4.5
Accounts payable [Member] \| Vendor Two [Member]
Credit Risk and Concentrations (Textual)
Concentration risk, percentage		10.00%
Purchases from vendors \| $		$ 0.9
Accounts Receivable [Member] \| Customer A [Member]
Credit Risk and Concentrations (Textual)
Concentration risk, percentage		17.00%
Accounts Receivable [Member] \| Customer C [Member]
Credit Risk and Concentrations (Textual)
Concentration risk, percentage		33.00%
Accounts Receivable [Member] \| Customer D [Member]
Credit Risk and Concentrations (Textual)
Concentration risk, percentage	12.00%

Segment Reporting and Foreign51

Segment Reporting and Foreign Operations (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Segment Reporting Information [Line Items]
Net revenues	$ 13,481	$ 14,087
Cost of net revenues	(10,193)	(10,140)
Gross profit	$ 3,288	$ 3,947
Gross margin %	24.00%	28.00%
Depreciation and amortization	$ 401	$ 263
Amortization of intangibles	1,383	1,056
Indoor Positioning Analytics [Member]
Segment Reporting Information [Line Items]
Net revenues	981	1,024
Cost of net revenues	(343)	(286)
Gross profit	$ 638	$ 738
Gross margin %	65.00%	72.00%
Depreciation and amortization	$ 76	$ 77
Amortization of intangibles	864	864
Infrastructure [Member]
Segment Reporting Information [Line Items]
Net revenues	12,500	13,063
Cost of net revenues	(9,850)	(9,854)
Gross profit	$ 2,650	$ 3,209
Gross margin %	21.00%	25.00%
Depreciation and amortization	$ 325	$ 186
Amortization of intangibles	$ 519	$ 192

Segment Reporting and Foreign52

Segment Reporting and Foreign Operations (Details 1) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Segment Reporting and Foreign Operations [Abstract]
Income from operations of reportable segments	$ 3,288	$ 3,947
Unallocated operating expenses	(8,642)	(8,129)
Interest expense	(684)	(143)
Other income (expense)	(9)	19
Loss from discontinued operations	(9)
Consolidated net loss	$ (6,056)	$ (4,306)

Segment Reporting and Foreign53

Segment Reporting and Foreign Operations (Details 2) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues by geographic area	$ 13,481	$ 14,087
Operating loss by geographic area	(5,354)	(4,182)
Net loss by geographic area	(6,056)	(4,306)
Identifiable assets by geographic area	54,577		$ 66,473
Long lived assets by geographic area	28,797		30,162
United States [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues by geographic area	13,425	14,049
Operating loss by geographic area	(4,953)	(3,790)
Net loss by geographic area	(5,647)	(3,914)
Identifiable assets by geographic area	54,019		66,050
Long lived assets by geographic area	28,422		29,843
Canada [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues by geographic area	56	38
Operating loss by geographic area	(401)	(383)
Net loss by geographic area	(401)	(383)
Identifiable assets by geographic area	535		400
Long lived assets by geographic area	375		319
Saudi Arabia [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues by geographic area
Operating loss by geographic area		(9)
Net loss by geographic area	(9)	(9)
Identifiable assets by geographic area	23		23
Long lived assets by geographic area
Eliminations [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues by geographic area
Operating loss by geographic area
Net loss by geographic area
Identifiable assets by geographic area
Long lived assets by geographic area

Commitments and Contingencies (

Commitments and Contingencies (Details Textual) - USD ($)	3 Months Ended	12 Months Ended
Commitments and Contingencies (Details Textual) - USD ($)	Mar. 31, 2017	Dec. 31, 2011	Dec. 31, 2016
Commitments and Contingencies (Textual)
Litigation settlement in favor of Creative Edge, Inc.		$ 936,000
Amount paid towards loss contingency	$ 214,000
Litigation amount accrued as advances payable	$ 722,000		$ 722,000

Subsequent Events (Details)

Subsequent Events (Details) - Subsequent Events [Member] - USD ($)	May 08, 2017	Apr. 19, 2017	Apr. 10, 2017
Subsequent Events (Textual)
Common shares issued for services, shares			50,000
Fair value of shares issued for services			$ 141,000
Exchange Agreement [Member]
Subsequent Events (Textual)
Amount of interest payable on debenture		$ 343,267
Due date of interest payment		May 9, 2017
Value of interest payment paid by company stock		$ 315,700
Number of shares issued in settlement of interest payable		110,000
Conversion rate		$ 2.87
Common stock issuance date		Apr. 20, 2017
Hillair Capital Investments L.P. [Member]
Subsequent Events (Textual)
Number of common shares the convertible shares were converted to	2,250
Hillair Capital Investments L.P. [Member] \| Series 1 Convertible Preferred Stock [Member]
Subsequent Events (Textual)
Number of common shares the convertible shares were converted to	100,000
Hillair Capital Investments L.P. [Member] \| Exchange Agreement [Member]
Subsequent Events (Textual)
Original Issue Discount percentage rate		8.00%
Principal amount of debt		$ 5,700,000