Franklin Wireless Corp. reported significant financial improvements for the three months ended September 30, 2024, compared to the same period in 2023. Net sales reached $13.3 million, marking a 38.0% increase from $9.7 million in the prior year. This growth was primarily driven by increased sales of approximately $6.4 million for two wireless products from major carrier customers, despite a decrease of about $2.7 million in sales of another product line.

Gross profit for the quarter was $2.1 million, up 36.9% from $1.5 million in the previous year, although the gross profit margin slightly declined to 15.5% from 15.7%. Operating expenses increased to $2.4 million, representing 18.3% of net sales, down from 21.7% in the prior year. The company reported a net income of $648,656, a significant turnaround from a net loss of $337,201 in the same quarter of 2023. This resulted in earnings per share attributable to Parent Company stockholders of $0.04, compared to a loss of $0.02 per share in the prior year.

Total assets as of September 30, 2024, increased to $51.6 million from $46.7 million at the end of June 2024, while total liabilities rose to $14.4 million from $10.3 million. The Parent Company stockholders’ equity also saw a slight increase to $35.8 million from $35.1 million.

Cash and cash equivalents improved to $14.6 million, up from $12.3 million at the end of June 2024, with net cash provided by operating activities amounting to $2.7 million, a stark contrast to the net cash used of $5.2 million in the same quarter of 2023. The company also reported a net increase in cash and cash equivalents of $2.4 million, compared to a decrease of $5.4 million in the prior year.

Strategically, Franklin Wireless continues to focus on its core business of providing integrated wireless solutions, including mobile hotspots and fixed wireless routers. The company has a majority ownership of 66.3% in its subsidiary, Franklin Technology Inc. (FTI), which is based in South Korea and plays a crucial role in product design and development. The company is also adapting to market trends, particularly the declining demand for mobile device management services, by enhancing its software offerings.

In terms of operational changes, Franklin Wireless has entered into a joint venture with MeiG Smart Technology Co., Ltd., contributing $3 million to the new corporation, which will be owned 60% by Franklin Wireless. The company has also accrued an incentive bonus of $1 million as of September 30, 2024, reflecting its ongoing commitment to incentivizing performance.