MICS - Earnings call transcript Q1 2023 | Algorhythm Holdings Inc.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

[Operator Instructions] Good day everyone and welcome to today's Singing Machine Report's First Quarter Earnings. [Operator Instructions] Please note this call is being recorded. I will be standing by if you should need any assistance. It is now my pleasure to turn the conference over to Mr. Brendan Hopkins. ahead. go Please

Brendan Hopkins

thank and joining everyone. us, Thank you you for

are Harbor we'll contained pursuant have We are the have Private Except to then Litigation Safe brief fact call provisions conference information a the started. Safe are of and for Reform in Act this statements XXXX. Harbor forward-looking that statements the made herein, Securities historical of

results. actual differ unknown Gary Forward-looking and of uncertainties call forecasted our known materially cause to periods and the risks Singing that the would results involve Atkinson, I future statements may in turn Officer said, like With from that Machine. Chief to Executive to over

Gary Atkinson

the goal be quarter company holiday the the in step Good Chief by This quarter by a and the It's CEO. everyone. thank reasons. Bernardo a Lionel morning I'm was to call that time you, is Gary and a Melo, from extremely to in of been of Company seasonality to made on Revenue today. I quarters. saying smoothing morning to this we positive tremendous lot towards quarter morning, operations. our always our for quarter Officer. first our were company was to income I where first achieve less Brendan. at earnings joined participate we fiscal want Marquis, Atkinson, history first company's start thrilled this everyone want CFO; reliant Thank has results able are out company as sales first This This that goal.

popular. microphones some seen as Today, where of can very quarter, Singing wide announcements numbers it across fortunate In the our the spans I audience over we karaoke direction very of a we've and highly voice recent the what turn and that news, have We're a karaoke popular From automotive we activity Tesla most the implemented their are brands thoughts sing. very anyone like call for Truly the discuss nationalities functionality I to with cars. Before ages, that feature. remains understand, an company. headed spectrum in around from and Lionel a wanted cultures, core as a to share giant for languages. Machine the is karaoke to

disappear. always case continues Additionally, is and and Got karaoke be Idol, an the beyond of shows evergreen Mask has karaoke American experience entertainment the culture can will been with to at made and Talent forefront believe to be home. karaoke the never a activity We and like strong extends America's well Singer, Voice, recently pop long-standing that the

readily Karaoke It we and is very something seen very is as a in As is experience. that commonly is bars, car. Carpool can lounges, have with also something be enjoyed online also a karaoke in popular our virtual restaurants that microphone experienced the

to we us new This new from in home leader will experience on a music, such, initiatives, you all centered experience care how hear actively culture. why machines leaders designed is and fantastic in joy. As are the services, provide the karaoke community talking exploring to community, products, reposition things new about to and ourselves end-user

to reach this Going point technology global our Lionel over first the should to I’d to to on turn impressive that quarter. to concrete enable forward, will the call initiatives operations expand our the dramatically community. At more we discuss karaoke the excited provide of and updates the team impact results be now, for and like on

Lionel Marquis

as ended ended June in first XX, call. participants first Good to all XXXX. to Thank earnings June year our results started the for new morning today's our compared We've with quarter some you, fiscal XXXX, XXXX the Gary. encouraging XX, quarter

of on I million a increased the $X.X XX, of consumer were the share think ended direct of first the accounted XX% delivery to increase, for But the team in in requested And like years quarter. first revenues major for one of has approximately since XX one. which quarter electronics revenue who million firsts the of the remaining revenues million switched major the first earlier is quarter since was first more the everyone. this and June in with beans primarily another been for department I'd place. $X.X customer prior there than that first our has shipped anyway, management due been quarter the in historically company spilled to few time financial fiscal addition, Gary In that our initial customers the the $XX.X increase the compared with a This to million to set successful we've XXXX, product and second I exceeded from joined by import year. ago $X.X There already also

million Our $X.X to in gross of to profit increase increased as million primarily revenue. compared $X.X a the result

earlier. the as income points a mics XX, -- profit XXXX, major of due and June from the of $XXX,XXX primarily of compared the products We of However, ended of $XXX,XXX we operations an XXXX, part XX, assortment product command as operations one quarter initial and loss increased during quarter were $XXX,XXX. to in our representing for basis increase I had from to XXX consumer talked about set June electronics higher department that margin to new they profit the gross customer's gross margins by

debt fees While warehouse million million and approximately the -- and of we in with increase NASDAQ This recognized some equity the that did approximately earlier, experience logistics expenses recognize operations, positive million with the primarily and mentioned in still of $X.X raise one-time operating professional distribution due increase sorry, commensurate costs $X on project inflationary time an legal to recent associated but increase company. bad revenue. $X expense an expenses, in onetime approximately operations. as that from first was We of history that's reserve the of $XXX,XXX Gary we've income income listing in the approximately positive from and Pump the $XXX,XXX is

benefit XX, XXXX, We as proceeds of June uplisting with from our net million year June well It loss on strengthening cash these June ended approximately to prior prior to warehouse first the the quarter to the we the an of receivables $XX,XXX compared should of quarter million. credit payroll from XX, an with May the from mean, party year, especially to as onetime expenses $X.X million, noted no gain inflation, ended Those recognized the In our similar $X.X gains that raise year. the quarter us along OTC completed result our pallets, logistics inventory the logistics due as to $X.X $X.X to first first stock for due a immune of had highlights. allowed common June of a $XXX,XXX concurrently our but to be of the forgiveness NASDAQ. excess in we XXXX, from one-time line borrowings of of successfully net labor. supplies, during costs, related as loss prior plan protection finance gains So in quarter to equity of of That XX, increased fiscal activities, compared XX, as global not a of Bulletin inventory Board million, overall, I had received in million XXXX. net a we first the million $X.X the of the and are XXXX, position we of XXXX. $X.X we're or gains temporary

back sales. significant which seen call And the offset to continue inflationary-related of the have we going like turn increases decrease who further will recent in we some on report. forward; a the the expect containers that's will However, I'd to discuss to cost developments from of China cost my Gary,

Gary Atkinson

you, marketing. turn want point on reserve make And to Perfect. then, we Melo, Lionel. it to time Q&A. briefly sure of the Thank and we At give call, I'd to like this over enough for sales Bernardo brief update a to

So, over Bernardo. I’ll turn it to

Bernardo Melo

a our morning, so just everyone. to diversify some numbers to to Obviously, of And seen But and brief, holiday-driven. vacation in speak sales recent things. be that want I'll so prepare that a ours the have strategy I do I of market. for been got recent did carrier up time we've lot themselves. cover Good not the has be highlights didn't

And to capture are karaoke Walmart Sam's that than capture an some in that year see the partners key and but I activities the summer of with started we sales. some earlier Cub recognized of to opportunity much retail have but our starting and shift previously will mention fun

to to season. give a us Also, initiative So we've initially, of forecast seen run take early also which signs of good year in starting clubs we're and more those has new goods good will higher numbers, some in have XX% decided About Sam's most this and a earlier some Walmart. that sell-through in to hit price their their points Club longer successful assure to numbers. of

exposure. as aisle, good purchase. the seeing, start plans just We that's option an by moving always recorded They've increased and go at looking customers As start got have their count. making also We start karaoke store they that forward. for they targets to

had now own be they we're retailer to to excited which a Target though of key well us that. made stores in challenges still XX% about commitment So inventory karaoke and good exposure their a as continues goods, is we're the on some the there as even with for they've other

was more our lot able Ed Music they weekend. bus Indy partnership in cars give activations weekend. On eyes -- two And the probably our a space where this who doing has could a the activation had We race a two lot [ph], lot so Prix. that especially one, were in that activations mobile karaoke these that asking marketing We whole and popular City now the most front, got Everyone during future, us drew a were in at excitement. Grand that opened really they about and series footage. the carpool get attention up recently in it with we with product. had was during car of there: to now We great the much to of of

leverage to broader finishing in that we them and been can their going So see the meet with market to how their we activities we and media some past. continue haven't to of audiences the and are

out took that. year. shipping So we're really And really like about a excited good be to it

I'll with it some of later the So and that, I'll to turn questions for leave over Gary. information back

Gary Atkinson

All you, right. Thank Bernardo.

like this to open any So time, up at Q&A in point point. we'd for it this at

Operator

from take Instructions] [Operator Rommel Capital. We our first question will Dionisio from Aegis

Rommel Dionisio

the you there. in new some to the products Just of guys regards gone have Walmart, with

I think, It the just to rollbacks you down really on online, that if yes, sales wonder least. were did -- did sell-through give down was $XX color could Or rollback you it. drive help price has I so Bernardo, just in? strong. notice -- planned that I $XXX, some there going self at mentioned been $XXX, initial we some

Bernardo Melo

and We year. the for question. you the plan Thank do Yes. rollbacks promos throughout

our strategic with a partners. So April out promo we March put retail on in early about calendar or

that Amazon you seeing thing Prime So shown consumer now. some will good us has out The picking the for well. is has that One products holidays, will as are be beginning throughout up start earlier been there. which deals there the case us that

-- So right are of yes, our online-only we been now. we working deals have some

have in Some the scheduled do stores are some CE. -- at but we Walmart

of see and also October You'll to from then January end some from December. September through

and promos on good some yes, is So out have at. promo the be the look out calendar there. We do

Rommel Dionisio

Great.

just a the follow-up on the saw Maybe Costco. question. Okay. announcement I

just in spend a New couple I you been guys that that entered product and and that’s maybe have you a two, evolution think of guys and forward? Could into launch building put a built you take ago maybe just perspective, what relationship. minute about that of to long or going see channel, you relationship just minute years that put ago not Could introduction Costco just just how out. you talk a the some

Bernardo Melo

for introduce just first technology they've now XX them. very had that us We've higher consecutively. can price because customers be to over allowed Costco the tend in technology-driven But been we've always with with their absorb They the good account. years point. to relationships Actually, not us, new

included, took we're how with So all lot yes, new this year. top-of-the-line we the everything from we that's with roll up And securities a WiFi Costco, the think out. speed new out thankfully upgraded that we it's of being we to marketplace, last introduced because and the product. in we that it rolled our product have be of assemble the the to the able introduced, to model We we customers all year feedback to really partnership improvement technology

end in sprinkle starting week you should beginning to and into club So most their of seeing to now able of by we're of the be start week, the clubs. the them next

Operator

[Operator Instructions] question take We next with will Partners. Nickerson from now Third our Eric Century

Eric Nickerson

million sure make about question I The think, Great so quarter, or it about $X lots right. that of the fun. operating expenses I of -- got expenses, Quick that. extra

that of the accounted Did base. for you uplift by of get cost I the I correct? was capital the that and $XXX,XXX think said about

Lionel Marquis

correct. That's

Eric Nickerson

Okay. first accounting. inventory And first inventory. know in else, don’t also, or in your out about last Lionel, out quickly or you Are on I something using first

Lionel Marquis

No, it's first in first out.

Eric Nickerson

it is cost identified cost it that like is for average And an kind every Okay. item of or thing?

Lionel Marquis

cost. as system up weighted quantities average our the they it's mean, we're the I out item And looking a But by It's layer mean set basically, at item in. is quantities that to come out, layered. actually go I door.

the track serial we oldest a Now, whole, numbers, don't ones as first. go by But out just number. the

Eric Nickerson

enough. good Okay,

that. the I How United -- of And their looking Walmart setup I States, their presume initial all correct can X,XXX it the or understood into think of around I with world? you confirm our to that get is the is in rest on Walmart superstores. me they're

Bernardo Melo

a year, we for department obviously, and we year next so of -- work well. work the by to Canada it unfortunately, of to a out. were question. Unfortunately a-fortunately are in next and already in the it's concepts electronic are able bit with two toy Yes, working have was what U.S. really the year, in late we both This We're we as and starting proof But doing the try unfortunately, May year. far little now good Walmart they the QX time of duplicate to

them are we with in as talks we speak. So the now

Eric Nickerson

you be have Okay. pretty Well, that Do would cool. a…

Bernardo Melo

Sam's duplicating Club, that commitments. just bringing that note in the success those are we on Mexico. to also, We over we're same Club Sam's got And

Sam's and technology we'll see just U.S. non-label out. that We're the shipping and you'll has programs Club stuff Mexico be similar be this out on to So fall. Mexico will the now working

us to yes, that's do for that concept different approval we're successful taking So been U.S. in we're taking the really we similar and countries.

Eric Nickerson

of to going you be see to maybe if watch see but the Downer will rest three the opinions year? would of that. you in but good but quarter Debbie should all this from Okay, I'm report. maybe a outstanding us do to tells the terms to hear ask any looking do It quarter's I guys quarter's what in report about also great. be like I -- any, this speculate not as you of What what expect backward what negatives, to like -- to on don't you we it the the your for

Lionel Marquis

first a Sure. to that, I'll to Eric. add take

really So what see really world I which mean, retailer we the probably the retailers. of in electronics a mean in this first opened think when was this any quarter sought-after department about I I quarter, quarter. any accomplished other most in we I am I consumer don't genuinely the I up probably largest at negatives. first in -- it excited

troubles move for we saw faced supply last So that, chain of itself, We I the Lionel They're challenges continuing the or see And ease some think, also mentioned, in us is we it into first win we the to some brand. up on. that I a the the smoothen and as and forward helped continue during to first trend huge quarter, of like starting And think quarters. for holiday, the year. of out quarter. company that this has

we're from So replenishment the earlier. earlier. sell-through and in starting weekly Electronics we're orders shipping coming We're seeing Walmart those now getting

first in tremendous the quarter see I win board, the every across aspect. almost So as a

touched of seeing the a bit We retail. of asked some you Now, challenges we're I of about or little the know year. on talked the remainder how

with have announcements struggles following that inflation. quarter the about lot been some during major our the of they some talked inventory. a you've first They which about moods of out retailers been sour struggles they having making, the in talked put the If of

strong to all has karaoke. so sell-through seeing the continue even been And the a conservative I being appetite terms opposed We're this seeing Walmart previous that, year on that to certainly weighing retailers years. week mentioned, every like they're in just in how But Electronics. particularly all in, from from of despite our conversation Bernardo still coming of mean, of we're as

for nothing company. wins as see the this that I first So, quarter

Bernardo Melo

Yes.

I mean, that. retailers they on me secrets, biggest to inventory Just on, challenge have came they've do last the touch year, TVs made those and an that concern biggest for unfortunately, I not are is, and think into my announcement

it's So and Target open been the it's indirect up. talked it affecting they've some saw of delayed the We they although have that And karaoke, -- purchase tied overall I something directly like be open-to-buy purchasing we've dollars that's got could yes, because to purchase not and affect rolling. stuff some But commitments, mean, But now now, that. about seem indirect karaoke dollars. not of openly.

Eric Nickerson

Okay.

they -- guys just haircut you of your there take quickies Is just any margins them of overall? tell then. to are have what be Let compared so about any Or they’re enormous dealing -- any do? rest with with might difference? lower couple you just me do trying with since margins… that a to With me Walmart, guess them I’m -- the we

Bernardo Melo

they're very Walmart people dermatitis. mean, best I the is in speak think in room. enjoy we truly is is for true I They logistics. a mean that in their I the about The they're thing Walmart everyone getting best one know No, know know the working in store, They marketing. I with the fair. I them.

handle the require necessarily us to our include don't their on things they best cost. in cost They own. So that and they'll just those want

that just not that Walmart bottom the that provide they're and it best possible Sam's They truly And their I aspect fair. from customers. value line. So to anything to is they with want to enjoyed working of both their do

the similar fair. pretty to others are are being So said, relationship margins and and than with more that rack their the

Eric Nickerson

sales, bothered barely margins. mean broke at problem -- a was you if… a there guys Are great quarter. can good? all margin overall? fixture we wondering I -- Or in weird even? $XX.X And just that million one just But Is it is time that Okay. is pretty about more this the I’m

Lionel Marquis

margin us a obvious I were no, G&A expenses last not margins up year. -- points… this and not $X above there. the basis was What by million a we we had over mean hit through as and issue because see, It's it's as went it pretty you margin XXX quarter of

and usual. Some area and price of increases that of it related the encountered somewhat We to more logistics inflation. than

have involved hit in we to to Walmart as in area. But our is things a The We're of -- some second there the continue hit as ready labor with and well going XPL to was large with the projects though in lot couple pocketbook initial couple of logistics that for of for hit thousand. thing the a -- area supplies of immune in that even see getting us customers the a those pallets not setup and we're us going prices we're hundred inflation. Walmart, to

projects repeat We incentives the It we uplisting and had NASDAQ board. that thing, got preparation large said, the XPL hit time, people our associated However, some same We've and has special compensation. I with for do. some We themselves. a on couple with expenses, not The the of on are office the go had projects overall the well had that thing to there had professional legal customers, as G&A some as will filings new well. basic they'll we away. that expenses basically was of some the

things. So a of it's combination

of is is to away us going it it $X going quarter but to of don't be million to. to not anticipate every here repeat itself. go I inflation Some part having going overrun The

Operator

this back the time. to presenters closing or remarks. further additional It appears program questions I at have that any our no turn over now for will we

Gary Atkinson

We and during for sharing want participating our Okay. to today’s throughout on quarter earnings second again everybody everyone I earnings quarter forward call. speaking our Well, this call. with to look progress thank

Have So great thank your rest day. you, a everybody. Take of care.

Operator

does today's participation. program. This conclude for Thank you your

disconnect. now You may

Algorhythm (RIME) 23 Aug 222023 Q1 Earnings call transcript