Name: Odysight.ai Inc. Q1 2024 Earnings Call
Start: 2025-11-20 09:33:22.634421+00

Executive Summary

Q1 2024 revenue was $0.187M, down 38% YoY and down sequentially vs Q2/Q3 2023; gross margin remained negative (-119.3%), driven by lower unit sales to the Fortune 500 medical customer and elevated cost base .
GAAP net loss widened to $3.162M (EPS -$0.30), while non-GAAP net loss was $2.662M; stock-based comp totaled $0.5M, per 8-K reconciliation .
Backlog surpassed $3.5M, and defense orders included a >$1M Seahawk program and an Apache prototype PdM deployment—key commercialization milestones that could act as catalysts as the company pivots into aerospace/defense PdM .
Liquidity remains adequate with $15.6M cash and short-term deposits; RPO stood at $2.2M as of Q1 2024 .
No formal quantitative guidance or consensus estimates were available; focus remains on R&D and market development (aviation/defense), implying continued opex intensity near term .

What Went Well and What Went Wrong

What Went Well
- Backlog traction: “with our backlog surpassing $3.5 million, we see a trend of growing demand for our solutions across multiple industries,” CEO Yehu Ofer noted—highlighting momentum outside medical .
- Initial aerospace/defense commercialization: >$1M Seahawk Maritime PdM order and Apache prototype deployment establish proof-points in rotary-wing fleets with large installed bases .
- Liquidity preserved: $7.4M cash + $8.2M deposits ($15.6M total) provide runway to continue R&D and commercialization efforts .
What Went Wrong
- Revenue decline: Q1 revenue fell to $0.187M from $0.303M YoY due to lower unit sales to the medical Fortune 500 customer .
- Gross margin pressure: Gross loss of -$0.223M on $0.187M revenue implies -119.3% gross margin—reflecting scale and mix challenges .
- Higher opex: R&D (+12% YoY), S&M (+33% YoY), and G&A (+40% YoY) increased as SCTC expanded I4.0 investments and organization—widening operating loss to -$3.364M .

Metric	Q1 2023	Q2 2023	Q3 2023	Q1 2024
Revenue ($USD Thousands)	303	674	110	187
Gross Loss ($USD Thousands)	(247)	(103)	(211)	(223)
Gross Margin %	-81.5%	-15.3%	-191.8%	-119.3%
Net Loss ($USD Thousands)	(2,686)	(2,876)	(2,542)	(3,162)
EPS (Basic & Diluted, $USD)	(0.37)	(0.39)	(0.32)	(0.30)

Estimates vs Actual (Q1 2024):

Consensus not available from S&P Global due to missing CIQ mapping; therefore, we cannot assess beats/misses (see Estimates Context) [GetEstimates error].

Segment revenue breakdown (where disclosed):

Segment	Q1 2023	Q3 2023	Q1 2024
Development Services ($USD Thousands)	106	105	106
Products ($USD Thousands)	197	29	81
Total Revenue ($USD Thousands)	303	134	187

KPIs and balance metrics:

KPI	Q1 2023	Q2 2023	Q3 2023	Q1 2024
RPO ($USD Millions)	$3.4	$2.9	$2.9	$2.2
Cash + Short-term Deposits ($USD Millions)	$24.6 (9.583+15.005)	$22.1 (3.319+18.736)	$19.5 (15.938+3.569)	$15.6 (7.362+8.228)
Contract Liabilities (Total, $USD Thousands)	3,416	2,961	2,851	2,247
Backlog ($USD Millions)	—	—	—	>$3.5

Non-GAAP (Q1 2024):

Non-GAAP net loss: $(2,662)K; GAAP net loss: $(3,162)K; stock-based comp adjustment $500K .

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY/Quarter	None provided	None provided	Maintained (no guidance)
Margins	FY/Quarter	None provided	None provided	Maintained (no guidance)
OpEx	FY/Quarter	None provided	None provided	Maintained (no guidance)
Tax Rate	FY/Quarter	None provided	None provided	Maintained (no guidance)

Topic	Previous Mentions (Q2 2023)	Previous Mentions (Q3 2023)	Current Period (Q1 2024)	Trend
AI/tech initiatives (PdM/CBM)	Emphasis on rebranding and I4.0 R&D build-out	Continued R&D expansion; new aerospace leases supporting growth	Platform gaining traction; defense collaborations emphasized	Positive commercialization momentum
Product performance (medical)	Revenue strength from Fortune 500 medical partner—$933K in 1H’23	9M’23 medical revenue drove first-time annual gross profit (per later 8-K)	Q1’24 lower unit sales; revenue down YoY	Mixed; near-term weaker units
Regional/geopolitical	No material impacts noted; new RG office	Israel war disclosed; limited operational impact as of filing	Continued disclosure; still limited impact; some reserve duty	Stable; monitoring
Regulatory/legal/IP	IIA grant and royalties obligations outlined	Risk disclosures updated; IIA and IP risks	EU patent revocations; U.S. reexamination; not expected material to ops	Neutral-to-cautious
R&D execution	R&D +39% (1H’23) to support I4.0	R&D +36% (9M’23)	R&D +12% YoY; continued hiring	Ongoing investment
Supply chain	Not specifically highlighted	Not specifically highlighted	Not specifically highlighted	Neutral

Note: No Q1 2024 earnings call transcript was available in our document search.

“Our unique visualization and AI platform solution is getting traction and with our backlog surpassing $3.5 million, we see a trend of growing demand for our solutions across multiple industries.” — Yehu Ofer, CEO .
Defense wins: Apache prototype partnership and >$1M Seahawk order position PdM solution in high-value aerospace fleets .
CFO transition: Appointment of Einav Brenner as CFO to strengthen leadership as commercial growth advances .

No Q1 2024 earnings call transcript found; therefore, no Q&A themes or clarifications could be extracted from a call [ListDocuments returned none].

Wall Street consensus (S&P Global/Capital IQ) was unavailable for SCTC due to missing CIQ mapping; we attempted to retrieve quarterly EPS and revenue estimates but could not access them. As a result, we cannot benchmark Q1 2024 results versus consensus or comment on beats/misses [GetEstimates error].

Near-term headwind: Q1 2024 revenue softness and negative gross margin underscore the need for scale and mix improvements in medical and emerging PdM lines .
Strategic pivot catalyst: Initial aerospace/defense orders (>$1M Seahawk; Apache prototype) validate PdM capabilities and could unlock larger fleet opportunities over time .
Liquidity adequacy: $15.6M cash/ST deposits provide operational runway through continued R&D and commercialization, but rising opex demands disciplined spend and milestones .
Customer concentration risk: Medical revenue remains heavily reliant on a single Fortune 500 customer—diversification via defense is strategically important .
IP/legal posture: EU patent revocations and U.S. reexamination noted but not expected to be material operationally; ongoing IIA obligations imply constraints on tech transfer/manufacturing .
Watch items: backlog conversion to revenue, gross margin trajectory, medical order cadence, and scaling defense pilots into multi-aircraft deployments .
Trading implications: Headlines around defense wins/backlog growth are positive catalysts; revenue/margin prints remain the gating factors for sustained re-rating until scale improves .