KORE Group Holdings Reports Slight Revenue Growth, Reduced Net Loss in Q3 2024

KORE Group Holdings, Inc. reported its financial results for the quarter ended September 30, 2024, showing a slight increase in total revenue to $68.9 million, up from $68.6 million in the same period of 2023. For the nine months ended September 30, 2024, total revenue reached $212.8 million, a 4% increase from $204.1 million in the prior year. The growth was primarily driven by a 13% increase in services revenue, attributed to the acquisition of Twilio’s IoT business, which contributed to a rise in IoT Connectivity revenue.

Despite the revenue growth, KORE experienced a net loss of $19.4 million for the three months ended September 30, 2024, significantly reduced from a net loss of $95.4 million in the same period last year. For the nine months, the net loss was $120.6 million, down from $133.4 million in 2023. The basic loss per share improved to $(1.00) from $(5.50) year-over-year.

Operating expenses for the three months ended September 30, 2024, were $43.8 million, a substantial decrease from $125.5 million in the same quarter of 2023. This reduction was influenced by strategic decisions to wind down less profitable hardware deals, resulting in a decrease in hardware revenue to $10.7 million from $11.6 million in the prior year. The company also recorded a goodwill impairment loss of $65.9 million in Q2 2024, which was adjusted in the financial statements.

KORE's cash position as of September 30, 2024, was $18.6 million, down from $27.1 million at the end of 2023. The company reported a total stockholders’ deficit of $77.2 million, a significant decline from a positive equity balance of $37.0 million at the end of 2023, primarily due to the accumulated deficit increasing to $(535.9 million).

In terms of strategic developments, KORE implemented a 1-for-5 reverse stock split effective July 1, 2024, and announced a restructuring plan affecting approximately 240 employees, incurring charges of about $2.0 million. The company is actively working to mitigate recurring operating losses by reducing operational expenses and reviewing its global footprint for cost-effectiveness.

KORE's financial statements were impacted by errors related to goodwill impairment calculations, leading to a restatement of previously issued financials. The company is addressing material weaknesses in its internal controls over financial reporting, particularly concerning goodwill impairment management review processes.