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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
November 12, 2024
Ondas Holdings Inc.
(Exact name of registrant as specified in its charter)
Nevada |
|
001-39761 |
|
47-2615102 |
(State or other jurisdiction
of incorporation) |
|
(Commission File Number) |
|
(IRS Employer
Identification No.) |
One Marina Park Drive Unit 1410, Boston, MA 02210
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including
area code (888) 350-9994
N/A
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K
filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under
the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under
the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of
the Act:
Title of each class |
|
Trading Symbol |
|
Name
of each exchange on which registered |
Common Stock par value $0.0001 |
|
ONDS |
|
The Nasdaq Stock Market
LLC |
Indicate by check mark whether the registrant
is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the
Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by checkmark
if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards
provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of
Operations and Financial Condition.
On November 12, 2024, Ondas
Holdings Inc. (the "Company") issued a press release announcing its financial and operating results for the three months ended
September 30, 2024. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K. A slide presentation,
which includes supplemental information relating to the Company’s financial results for the three months ended September 30, 2024,
is furnished as Exhibit 99.2 to this Current Report on Form 8-K.
The information in Item 2.02
of this Current Report on Form 8-K (including Exhibit 99.1 and Exhibit 99.2) is furnished and shall not be deemed to be “filed”
for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject
to the liabilities of that section. The information in Item 2.02 of this Current Report on Form 8-K (including Exhibit 99.1 and Exhibit
99.2) shall not be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, whether
made before or after the date of this Current Report on Form 8-K, regardless of any general incorporation language in the filing.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: November 12, 2024 |
ONDAS HOLDINGS INC. |
|
|
|
|
|
|
|
By: |
/s/
Eric A. Brock |
|
|
Eric A. Brock |
|
|
Chief Executive Officer |
2
Exhibit 99.1
Ondas
Holdings Reports Third Quarter 2024 Financial Results: Secures $14.4 Million in Drone Platform Purchase Orders in Q3
Q3
marks the largest bookings in Ondas’ history
$14.4
million in purchase orders were from a major military customer for the Iron Drone Raider and Optimus System autonomous drone platforms
Iron
Drone Raider is emerging as a best-in-class ‘hard kill’ counter drone solution addressing the urgent need for protection from hostile
drones
Order
from Metra, Chicago’s primary commuter rail system, for system-wide 900 MHz upgrade secured by partner Siemens
Railroads
communicate plans for general purpose 900 MHz network architecture to be deployed to support resilient rail operations
Conference
Call Scheduled for Today at 8:30 a.m. ET
BOSTON,
MA – November 12, 2024 - Ondas Holdings Inc. (Nasdaq: ONDS) (“Ondas” or the “Company”), a leading provider
of private industrial wireless networks and commercial drone and automated data solutions through its Ondas Networks and Ondas Autonomous
Systems (OAS) business units, reported financial and operating results for the three months ended September 30, 2024.
“Ondas
had a strong quarter operationally marked by the receipt of significant orders at OAS and deeper engagement with railroad customers at
Ondas Networks,” said Eric Brock, Chairman and CEO of Ondas Holdings. “OAS secured multiple orders totaling $14.4 million
for our Iron Drone Raider and Optimus System drone platforms from a major military customer. This signals our entry into military markets
and establishes our Iron Drone Raider system as a third revenue-generating technology platform in Ondas’ portfolio. Ondas Networks is
benefiting from increased visibility on Class I railroads’ network plans and realized a significant milestone, with distribution
partner Siemens securing an order from Metra, a transit rail operator serving passengers in Chicago.
“At
Ondas Networks, we believe Metra’s order for a system-wide upgrade of the 900 MHz wireless network to the new A-block with the
jointly developed next-generation Advanced Train Control Systems (ATCS) platform confirms that Ondas Networks and Siemens have established
a comprehensive deployment and migration plan to support adoption of the dot16 wireless standard by railroads in North America. That
was further demonstrated during Q3 with Siemens’ receipt of an additional order from a Class I Railroad for an expansion of an
existing live 900 MHz network, also in Chicago. In short, we are demonstrating the robustness of the dot16 standard as we start 900 MHz
upgrades in Chicago – the most complex railroad wireless environment in the country.
“Our
exceptional efforts at OAS are translating into significant results as we have positioned the Iron Drone Raider system as a leading candidate
to own the category for ‘hard kill’ counter-uncrewed autonomous system (UAS) infrastructure. In addition, our Optimus System
will now be deployed to secure military bases and border checkpoints, demonstrating the exceptional capabilities of this market-leading
system in high value security markets. We see growing demand for aerial security and inspection from ‘drone-in-a-box’ systems.
As we scale with customers for military and public safety drone-as-a-first-responder (DFR) security applications with Optimus, we see
evidence that security officials and project managers in military, public safety and critical industrial markets are increasingly appreciating
OAS’ ability to satisfy the most demanding requirements to secure and protect high value assets and locations.”
Brock
concluded, “Ondas remains in a strong position, with leading technology platforms addressing large, high value end markets and
increased evidence of customer acceptance across both business units. Indeed, the third quarter represented the largest bookings quarter
in Ondas’ history. Further, we raised $10.5 million in capital between Ondas Holdings and our business units during both the third
quarter and fourth quarter-to-date, demonstrating continued investor support. Our top line revenue has been delayed, mainly due to 900
MHz timeline extensions with Ondas Networks rail customers, and supply chain and market-related issues stemming from the Gaza conflict
in Israel. Nonetheless, a strengthening order book and customer pipeline at OAS as well as improving engagement with the railroad customers
at Ondas Networks bodes well for our outlook. I expect a strong end to 2024 and am optimistic about our ability to drive significant
growth in 2025.”
Third
Quarter 2024 and Recent Highlights – Ondas Networks
| ● | Generated
approximately $445,000 in revenue during the third quarter of 2024. |
| ● | Secured
$3.0 million in capital from Charles & Potomac Capital LLC (Charles & Potomac) in
the third quarter and fourth quarter-to-date. |
| ● | Siemens
secured a purchase order from Metra, the primary commuter rail system serving the Chicago
metropolitan area, for Airlink dot-16 compliant wireless systems to upgrade the legacy 900
MHz ATCS network and migrate the network to the new 900 MHz A-block. |
| ● | Siemens
secured a purchase order from a Class I rail operator for Airlink dot-16 compliant wireless
systems to expand the final programs in advance of an expected upgrade of the legacy 900
MHz ATCS network and migration to the new 900 MHz A-block in Chicago. |
| ● | Achieved
key development milestones, including the provision on initial prototype radios with our
partner Siemens in the 220 MHz radio program on behalf of an Amtrak-sponsored upgrade to
its Advanced Civil Speed Enforcement System (ACSES), a Positive Train Control (PTC) system
utilized by passenger and transit, as well as certain freight rail operators in the Northeast
Corridor (NEC). Product development is expected to be completed in Q1 2025, and commercial
deliveries are slated for Q2 2025. |
| ● | Advanced
development program for on-locomotive radios designed for European rail markets. |
| ● | Announced
that Markus Nottelmann, an accomplished executive with significant railroad operations and
financial experience, joined Ondas as a Senior Advisor and board member of Ondas Networks. |
| ● | Continuing
engagement with MxV Rail regarding improved network operations and 802.16t applications.
This work includes the Base Station Controller which enables the dynamic sharing of spectrum
resources in 802.16t networks and a major testing program related to the use of 802.16t for
next-generation HOT/EOT systems. |
| ● | Demonstrated
the use of 802.16 in the 900 MHz band to support the Interoperable Train Control Messaging
(ITCM) protocol with multiple railroads and ecosystem vendors. ITCM is the primary transport
for PTC messaging and 900 MHz provides an alternate path to improve network reliability and
availability. Applications such as PTC, which were previously restricted to the 220 MHz network,
can now be supported by the new 900 MHz network, adding resiliency, redundancy and diversity
to critical railroad operations. |
| ● | Preparing
for field trial by a Class I railroad in November to host ITCM over 900 MHz; a program which
is being planned for expansion upon successful field activity. |
| ● | Submitted
proposals for network equipment and development programs upon request from rail vendors for
dot16 wireless network systems in international markets. |
| ● | Entered
into a platform agreement with KLEAR Inc., a provider of working capital financing. Ondas
Networks secured an initial $500,000 short-term working capital loan secured by customer
invoices during October. |
| ● | Partnered
with Siemens to exhibit at the Railway Systems Suppliers Inc. (RSSI) show in Louisville,
Kentucky and hosted a subsequent “Demo Day” for key customers which featured
a variety of general-purpose applications supported by an 802.16t wireless network. Demonstrations
included the hosting of ITCM messaging over the new 900 MHz band, which can be deployed to
eliminate single points of failure and support critical PTC redundancy of the 220 MHz network
for train operating and safety systems. |
| ● | Submitted
written testimony to members of the U.S. House of Representatives in advance of a hearing
on rail safety matters held by the U.S. House of Representatives’ Transportation Subcommittee
on Railroads, Pipelines and Hazardous Materials. The letter to the subcommittee was written
in support of the Railroad wireless technology roadmap and the new 900 MHz network and its
potential to support improved train safety and operations. |
Guy
Simpson, Ondas Networks President and Chief Operating Officer, commented, “Ondas Networks’ visibility from our railroad customers
is improving with respect to plans for the new 900 MHZ network. This is highlighted by the order received by Siemens from Metra for a
planned system-wide 900 MHz upgrade to support their passenger operations in Chicago. The Metra order was followed by the expansion of
a 900 MHz network for a Class I railroad, also in Chicago, that has been in live operation for nearly a year.
“In
addition, we continue to see expanding application and network opportunities for our dot16 software defined networking capabilities.
We advanced the PTC data radio program on behalf of Amtrak, which included delivering initial prototype radios. We also are engaged with
the American Association of Railroads (AAR) on solutions shaping for next-generation Head-of-Train and End-of-Train (NGHE) systems as
the industry seeks to enhance operational and safety systems supporting the operations of long trains. We believe Ondas Networks is well
positioned to support the next-generation NGHE – targeted for the 450 MHz frequency band – and intended to improve the system
supporting the safe operations of long trains.”
Simpson
concluded, “As we work to secure network buildout timelines and orders, we believe we have greater visibility into the freight
railroads’ roadmap plans for the 900 MHz A-block. We now expect the new 900 MHz network to serve as both a primary network for
next-generation ATCS and Centralized Train Control (CTC) protocols, as well as a backup for CTC and PTC running ITCM protocols native
to the 220 MHz network. This architecture, with inherent redundancy and the support of multiple applications on 900 MHz demonstrates
the value of the dot16 wireless standard. We will continue to work closely with Siemens and railroad customers to support deployments
in the 900 MHz network and to improve visibility in terms of orders and buildout plans for 2025.”
Third
Quarter 2024 and Recent Highlights – Ondas Autonomous Systems (OAS)
| ● | Generated
approximately $1.0 million in revenue and secured $14.4 million in purchase orders during
the third quarter of 2024. |
| ● | Secured
$3.5 million in capital from investors including Privet Ventures LLC, an investment company
owned by Eric Brock, and Charles & Potomac, an investment company owned by Ondas Board
Member Joe Popolo. |
| ● | Airobotics
secured several purchase orders from a major government military customer for the Iron Drone
Raider system totaling $9 million. During July and August 2024, Airobotics received purchase
orders for both initial deployment of new systems and for upgrades of the existing Iron Drone
Raider system from this customer. In September 2024, Airobotics received a third order for
operational deployment of the system in multiple locations, assisting in protecting national
borders, military units and other critical assets from hostile drones. |
| ● | Airobotics
secured a $5.4 million purchase order in September 2024 from a major government military
customer for the Optimus System, with deployments intended to support the protection of critical
assets at military bases and borders under challenging environmental conditions. |
| ● | Airobotics
continued to expand its operations with a local governmental entity in Dubai in support of
drone network infrastructure for public safety and other public services. The deployed fleet
of Optimus Systems has been extensively utilized by the local government entity, with potential
for additional orders expected in the fourth quarter of 2024. |
| ● | Airobotics
continued expanding its market reach into Europe and will perform designated demonstrations
for defense and critical infrastructure potential customers through reseller partnerships
with HHLA Sky and C-Astral Aerospace in Germany, Slovenia, and other European countries. |
| ● | Airobotics
received a $1.0 million grant from the Israeli Innovation Authority (IIA) to support further
enhancements of the Iron Drone Raider in November. |
| ● | American
Robotics secured and delivered a key contract with the United States Coast Guard (USCG) for
maritime emissions monitoring to support Environmental Protection Agency (EPA) Clean Port
initiatives at the Ports of Los Angeles and Long Beach, positioning American Robotics as
a prime vendor for a U.S. federal agency. |
| ● | American
Robotics demonstrated the Optimus System to key customers including a technology infrastructure
provider in Texas. This demonstration showcased its capability to remotely operate drone
fleets Beyond Visual Line of Sight (BVLOS) by leveraging Optimus’ FAA type certification
and the Kestrel system. |
| ● | American
Robotics is planning a major demonstration of its Optimus System in November for one of the
largest public safety departments in the United States. |
| ● | American
Robotics hosted an investor day at its Maryland Headquarters featuring the Iron Drone Raider
and Optimus Systems demonstration and webinar. |
| ● | OAS
entered into a strategic alliance with GenLab Venture Studio, a venture studio focused on
integrated AI solutions, to develop go-to-market business models in specific verticals with
the benefit of fused AI capabilities with the Optimus aerial security and inspection platform. |
OAS
President Meir Kliner commented, “OAS had a pivotal quarter as evidenced with bookings of over $14 million for our Optimus and
Iron Drone systems via multiple orders from a major military customer. These orders came as a result of our continuous efforts to leverage
the core advantages of our ‘built for purpose’ platforms which include market-leading functionality and reliability. As we
expand the markets for our dual-use platforms, we expect to benefit from strengthening demand as the world responds to both the value
and potential threats of drones deployed in defense, public safety, and critical infrastructure markets.
“We
are seeing significant interest in global defense markets for the Iron Drone Raider system and engagement from specific military customers.
The Iron Drone Raider system is emerging as a best-in-class, ‘hard kill’ counter drone solution addressing the urgent need for
protection from hostile drones. Similarly, demand for Optimus is strong in both defense and security markets and our customer pipeline
is maturing. As we move forward, we are investing to expand our operating infrastructure to support what we believe will be an increase
in orders and system deliveries in the months and quarters ahead for both Iron Drone and Optimus.”
Third
Quarter 2024 Financial Results
Revenues
were approximately $1.5 million for the three months ended September 30, 2024, compared to $2.7 million for the three months ended September
30, 2023. The decrease was primarily the result of delays in order activity for product sales at Ondas Networks, partially offset by
increases at OAS as we started to fulfill the new purchase orders received in the quarter.
Gross
profit was approximately $0.05 million for the three months ended September 30, 2024, compared to approximately $0.6 million for the
three months ended September 30, 2023. Gross profit as a percentage of revenues was approximately 3% for the three months ended September
30, 2024, compared to 21% for the three months ended September 30, 2023. This is due to the change in the mix of revenues in the third
quarter of 2024, which included development projects with lower gross margins as compared to product revenue with higher gross margins
in the third quarter of 2023, as well as certain fixed costs related to OAS service delivery. At this time, gross margins may be variable
on a quarter-to-quarter basis due to low revenue levels and shifts in revenue mix between product, development, and services revenues.
Operating
expenses were approximately $8.7 million for the three months ended September 30, 2024, as compared to approximately $6.5 million for
the three months ended September 30, 2023.
Cash
operating expenses for the three months ended September 30, 2024 were approximately $7.1 million, as compared to approximately $7.5 million
for the three months ended September 30, 2023. Cash operating expenses for the three months ended September 30, 2024, exclude non-cash
operating items during the period, including $1.3 million in depreciation and amortization, and $0.3 million of stock-based compensation
expense. For the three months ending September 30, 2023, cash operating expenses excluded $1.3 million in depreciation and amortization
and the reversal of $2.3 million of stock-based compensation expense because of employees leaving the company before the stock awards
vested. Cash operating expense is a non-GAAP financial measure.
The
Company realized an operating loss of approximately $8.7 million for the three months ended September 30, 2024, compared to $5.9 million
for the three months ended September 30, 2023.
Net
loss was approximately $9.5 million for the three months ended September 30, 2024, as compared to a net loss of $7.3 million for the
three months ended September 30, 2023. Adjusted EBITDA loss was approximately $7.1 million, as compared to an Adjusted EBITDA loss of
$6.9 million for the three months ended September 30, 2023. Adjusted EBITDA is a non-GAAP financial measure.
The
Company held cash and restricted cash of approximately $2.9 million as of September 30, 2024, as compared to approximately $15.0 million
as of December 31, 2023.
The
Company expects to fund its operations from the cash on hand as of September 30, 2024, proceeds from financing activities, gross profits
generated from revenue growth, potential prepayments from customers for purchase orders, potential proceeds from warrants issued and
outstanding, and additional funds that the Company may seek through equity or debt offerings and/or borrowings under additional notes
payable, lines of credit or other sources.
Subsequent
to September 30, 2024, the Company raised an additional $3.55 million of capital which included $3.5 million via a convertible note at
OAS, a transaction led by Privet Ventures and Charles & Potomac. Privet Ventures is an investment vehicle owned by Ondas’ CEO
Eric Brock.
Operational
and Financial Outlook for 2024
The
Company expects a recovery in revenue growth in the fourth quarter of 2024 driven primarily by the OAS business unit as the Company fulfills
backlog, which includes military orders secured in the third quarter. Revenue expectations for Ondas Networks are modest in the fourth
quarter of 2024, and limited to funded development programs, given the current visibility on deployment plans in the 900 MHz network
which point to growth in 2025.
Bookings
and revenue growth are expected to fluctuate from quarter-to-quarter given the uncertainty around the timing of customer activity in
front of the targeted commercial rollout for the 900 MHz rail network, the development programs underway with Siemens, in addition to
the timing of OAS’s deliveries of the Optimus and Iron Drone systems to its growing roster of customers globally.
Lastly,
Ondas has requested an additional 180-day compliance period from The Nasdaq Stock Market LLC (“Nasdaq”) to regain compliance
with the minimum bid price requirement of US$1.00 per share under Nasdaq’s Listing Rule 5550 (a) (2).
Earnings
Conference Call & Audio Webcast Details
Date:
Tuesday, November 12, 2024
Time:
8:30 a.m. Eastern time
Toll-free
dial-in number: 844-883-3907
International
dial-in number: 412-317-5798
Call
participant pre-registration link: here
The
Company encourages listeners to pre-register, which allows callers to gain immediate access and bypass the live operator. Please note
that you can register at any time during the call. For those who choose not to pre-register, please call the conference telephone number
10-15 minutes prior to the start time, at which time an operator will register your name and organization.
The
conference call will also be broadcast live and available for replay here and via the investor relations section of the Company’s
website at ir.ondas.com. A replay will be accessible from the investor relations website after completion of the event.
About
Ondas Holdings Inc
Ondas
Holdings Inc. (“Ondas”) is a leading provider of private wireless data solutions via Ondas Networks Inc. (“Ondas Networks”)
and commercial drone solutions through Ondas Autonomous Systems Inc. via its wholly owned subsidiaries American Robotics, Inc. (“American
Robotics” or “AR”) and Airobotics LTD (“Airobotics”), which we operate as a separate business unit called Ondas
Autonomous Systems.
Ondas
Networks is a developer of proprietary, software-based wireless broadband technology for large established and emerging commercial and
government markets. Ondas Networks’ standards-based (802.16s), multi-patented, software-defined radio FullMAX platform enables Mission-Critical
IoT (MC-IoT) applications by overcoming the bandwidth limitations of today’s legacy private licensed wireless networks. Ondas Networks’
customer end markets include railroads, utilities, oil and gas, transportation, aviation (including drone operators) and government entities
whose demands span a wide range of mission critical applications.
Ondas
Autonomous Systems Inc. (OAS) specializes in designing, developing, and marketing autonomous drone solutions via its two advanced drone
platforms: the Optimus System, the world’s first FAA-certified small UAS (sUAS) for aerial security and data capture, and the Iron
Drone Raider, a counter-drone system designed to combat hostile drones. Both platforms are highly automated, AI-powered, and capable
of continuous, remote operation for critical defense, infrastructure, industrial, and government applications. American Robotics and
Airobotics have achieved industry-leading regulatory milestones, including the first-ever FAA Type Certification for the Optimus System
and the first drone system approved by the FAA for automated beyond-visual-line-of-sight (BVLOS) operations without an on-site human
operator. Ondas Networks, American Robotics and Airobotics together provide users in defense, homeland security, public safety and
other critical industrial and government security and infrastructure markets with improved connectivity, situational awareness and data
collection and information processing capabilities.
Ondas
Networks, American Robotics and Airobotics together provide users in defense, homeland security, public safety and other critical industrial
and government security and infrastructure markets with improved connectivity, situational awareness and data collection and information
processing capabilities.
For
additional information on Ondas Holdings, visit www.ondas.com or follow Ondas Holdings on X formerly known as Twitter and LinkedIn. For
additional information on Ondas Networks, visit www.ondasnetworks.com or follow Ondas Networks on X and LinkedIn. For additional information
on American Robotics, visit www.american-robotics.com or follow American Robotics on X and LinkedIn. For additional information on Airobotics,
visit www.airoboticsdrones.com or follow Airobotics on X and LinkedIn. For additional information on Ondas Autonomous Systems, follow
us on LinkedIn.
Information
on our websites and social media platforms is not incorporated by reference in this release or in any of our filings with the U.S. Securities
and Exchange Commission.
Non-GAAP
Financial Measures
As
required by the rules of the Securities and Exchange Commission (“SEC”), we provide reconciliations of Adjusted EBITDA and
cash operating expenses, non-GAAP financial measures, contained in this press release to the most directly comparable measure under GAAP,
which reconciliations are set forth in the table below.
We
believe that Adjusted EBITDA and cash operating expenses facilitate analysis of our ongoing business operations because they exclude
items that may not be reflective of, or are unrelated to, the Company’s core operating performance, and may assist investors with comparisons
to prior periods and assessing trends in our underlying businesses. Other companies may calculate Adjusted EBITDA and cash operating
expenses differently, and therefore our measures may not be comparable to similarly titled measures used by other companies. Adjusted
EBITDA and cash operating expenses should only be used as supplemental measures of our operating performance.
We
believe that Adjusted EBITDA improves comparability from period to period by removing the impact of our capital structure (interest and
financing expenses), asset base (depreciation and amortization), tax impacts and other adjustments as set out in the table below, which
management has determined are not reflective of core operating activities and thereby assist investors with assessing trends in our underlying
businesses.
We
believe that cash operating expenses is useful to manage expenses as it excludes non-cash items (depreciation expense, amortization expense
and stock-based compensation expense) that may obscure our underlying business performance.
Management
uses Adjusted EBITDA and cash operating expenses in making financial, operating, and planning decisions and evaluating the Company’s
ongoing performance.
Forward-Looking
Statements
Statements
made in this release that are not statements of historical or current facts are “forward-looking statements” within the meaning
of the Private Securities Litigation Reform Act of 1995. We caution readers that forward-looking statements are predictions based on
our current expectations about future events. These forward-looking statements are not guarantees of future performance and are subject
to risks, uncertainties and assumptions that are difficult to predict. Our actual results, performance, or achievements could differ
materially from those expressed or implied by the forward-looking statements as a result of a number of factors, including the risks
discussed under the heading “Risk Factors” discussed under the caption “Item 1A. Risk Factors” in Part I of our most
recent Annual Report on Form 10-K or any updates discussed under the caption “Item 1A. Risk Factors” in Part II of our Quarterly
Reports on Form 10-Q and in our other filings with the SEC. We undertake no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise that occur after that date, except as required by law.
Contacts
IR
Contact for Ondas Holdings Inc.
888.350.9994
ir@ondas.com
Media
Contact for Ondas
Preston Grimes
Marketing Manager, Ondas Holdings Inc.
preston.grimes@ondas.com
ONDAS
HOLDINGS INC.
CONDENSED
CONSOLIDATED BALANCE SHEETS
| |
September 30, | | |
December 31, | |
| |
2024 | | |
2023 | |
| |
(Unaudited) | | |
| |
ASSETS | |
| | |
| |
Current
Assets: | |
| | |
| |
Cash | |
$ | 2,832,550 | | |
$ | 14,979,436 | |
Restricted
cash | |
| 40,736 | | |
| 42,564 | |
Accounts
receivable, net | |
| 2,876,087 | | |
| 3,429,974 | |
Inventory,
net | |
| 8,878,734 | | |
| 2,186,646 | |
Other
current assets | |
| 2,540,740 | | |
| 2,967,619 | |
Total
current assets | |
| 17,168,847 | | |
| 23,606,239 | |
| |
| | | |
| | |
Property
and equipment, net | |
| 2,734,321 | | |
| 4,175,958 | |
| |
| | | |
| | |
Other
Assets: | |
| | | |
| | |
Goodwill,
net of accumulated impairment charges | |
| 27,751,921 | | |
| 27,751,921 | |
Intangible
assets, net | |
| 28,222,161 | | |
| 31,329,182 | |
Lease
deposits and other assets | |
| 482,392 | | |
| 599,517 | |
Operating
lease right of use assets | |
| 3,799,014 | | |
| 4,701,865 | |
Total
other assets | |
| 60,255,488 | | |
| 64,382,485 | |
Total
assets | |
$ | 80,158,656 | | |
$ | 92,164,682 | |
| |
| | | |
| | |
LIABILITIES
AND STOCKHOLDERS’ EQUITY | |
| | | |
| | |
Current
Liabilities: | |
| | | |
| | |
Accounts
payable | |
$ | 4,021,804 | | |
$ | 5,177,022 | |
Operating
lease liabilities | |
| 771,943 | | |
| 685,099 | |
Accrued
expenses and other current liabilities | |
| 3,517,164 | | |
| 3,587,877 | |
Notes
payable, net of unamortized issuance costs of $558,785 and $0, respectively, related party | |
| 891,215 | | |
| - | |
Convertible
notes payable, net of unamortized debt discount and issuance cost of $13,153 and $0, respectively, related party | |
| 1,486,847 | | |
| - | |
Convertible
notes payable, net of unamortized debt discount and issuance cost of $965,066 and $1,968,411, respectively | |
| 27,824,724 | | |
| 25,692,505 | |
Government
grant liability | |
| 548,219 | | |
| 520,657 | |
Deferred
revenue | |
| 447,720 | | |
| 276,944 | |
Total
current liabilities | |
| 39,509,636 | | |
| 35,940,104 | |
| |
| | | |
| | |
Long-Term
Liabilities: | |
| | | |
| | |
Notes
payable | |
| 300,000 | | |
| 300,000 | |
Convertible
notes payable, net of current, net of unamortized debt discount and issuance cost of $0 and $391,718, respectively | |
| - | | |
| 2,812,156 | |
Accrued
interest | |
| 21,249 | | |
| 26,844 | |
Government
grant liability, net of current | |
| 1,895,434 | | |
| 2,229,047 | |
Operating
lease liabilities, net of current | |
| 5,254,623 | | |
| 5,800,710 | |
Other
liabilities | |
| 82,500 | | |
| - | |
Total
long-term liabilities | |
| 7,553,806 | | |
| 11,168,757 | |
Total
liabilities | |
| 47,063,442 | | |
| 47,108,861 | |
| |
| | | |
| | |
Commitments
and Contingencies (Note 11) | |
| | | |
| | |
| |
| | | |
| | |
Temporary
Equity | |
| | | |
| | |
Redeemable
noncontrolling interest | |
| 18,176,422 | | |
| 11,920,694 | |
| |
| | | |
| | |
Stockholders’
Equity | |
| | | |
| | |
Preferred
stock - par value $0.0001; 5,000,000 shares authorized at September 30, 2024 and December 31, 2023, respectively, and none issued
or outstanding at September 30, 2024 and December 31, 2023, respectively | |
| - | | |
| - | |
Preferred
stock, Series A - par value $0.0001; 5,000,000 shares authorized at September 30, 2024 and December 31, 2023, respectively,
and none issued or outstanding at September 30, 2024 and December 31, 2023, respectively | |
| - | | |
| - | |
Common
Stock - par value $0.0001; 300,000,000 shares authorized; 75,297,311 and 61,940,878 issued and outstanding, respectively September
30, 2024 and December 31, 2023, respectively | |
| 7,530 | | |
| 6,194 | |
Additional
paid in capital | |
| 240,943,416 | | |
| 231,488,999 | |
Accumulated
deficit | |
| (226,032,154 | ) | |
| (198,360,066 | ) |
Total
stockholders’ equity | |
| 14,918,792 | | |
| 33,135,127 | |
Total
liabilities and stockholders’ equity | |
$ | 80,158,656 | | |
$ | 92,164,682 | |
ONDAS
HOLDINGS INC.
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| |
Three Months Ended | |
| |
September 30, | |
| |
2024 | | |
2023 | |
| |
| | |
| |
Revenues, net | |
$ | 1,480,792 | | |
$ | 2,665,190 | |
Cost of goods sold | |
| 1,433,232 | | |
| 2,110,312 | |
Gross profit | |
| 47,560 | | |
| 554,878 | |
| |
| | | |
| | |
Operating expenses: | |
| | | |
| | |
General and administration | |
| 4,114,986 | | |
| 2,563,319 | |
Sales and marketing | |
| 1,410,944 | | |
| 1,224,144 | |
Research and development | |
| 3,182,345 | | |
| 2,701,436 | |
Total operating expenses | |
| 8,708,275 | | |
| 6,488,899 | |
| |
| | | |
| | |
Operating loss | |
| (8,660,715 | ) | |
| (5,934,021 | ) |
| |
| | | |
| | |
Other income (expense), net | |
| | | |
| | |
Other income (expense), net | |
| (1,786 | ) | |
| (124,636 | ) |
Change in fair value of government grant liability | |
| (86,307 | ) | |
| (295,094 | ) |
Interest income | |
| 121,608 | | |
| 379 | |
Interest expense | |
| (871,335 | ) | |
| (893,951 | ) |
Foreign exchange gain (loss), net | |
| (27,733 | ) | |
| (45,138 | ) |
Total other income (expense), net | |
| (865,553 | ) | |
| (1,358,440 | ) |
| |
| | | |
| | |
Loss before income taxes | |
| (9,526,268 | ) | |
| (7,292,461 | ) |
| |
| | | |
| | |
Provision for income taxes | |
| - | | |
| - | |
| |
| | | |
| | |
Net loss | |
| (9,526,268 | ) | |
| ((7,292,461 | ) |
Less preferred dividends attributable to noncontrolling interest | |
| 390,000 | | |
| 212,208 | |
Less deemed dividends attributable to accretion of redemption value | |
| 755,644 | | |
| 410,322 | |
Net loss attributable to common stockholders | |
$ | (10,671,912 | ) | |
$ | (7,914,991 | ) |
| |
| | | |
| | |
Net loss per share - basic and diluted | |
$ | (0.15 | ) | |
$ | (0.15 | ) |
| |
| | | |
| | |
Weighted average number of common shares outstanding, basic and diluted | |
| 70,741,662 | | |
| 53,892,848 | |
ONDAS
HOLDINGS INC.
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| |
Nine Months Ended | |
| |
September 30, | |
| |
2024 | | |
2023 | |
| |
| | |
| |
CASH FLOWS FROM OPERATING ACTIVITIES | |
| | |
| |
Net loss | |
$ | (27,672,088 | ) | |
$ | (30,706,098 | ) |
Adjustments to reconcile net loss to net cash flows used in operating activities: | |
| | | |
| | |
Depreciation | |
| 424,637 | | |
| 648,624 | |
Amortization of debt discount | |
| 1,502,657 | | |
| 2,438,462 | |
Amortization of intangible assets | |
| 3,161,729 | | |
| 3,103,591 | |
Amortization of right of use asset | |
| 902,851 | | |
| 715,041 | |
Loss on disposal of equipment | |
| 1,578 | | |
| 7,757 | |
Loss on intellectual property | |
| - | | |
| 12,223 | |
Stock-based compensation | |
| 988,683 | | |
| 636,350 | |
Change in fair value of government grant liability | |
| (605,889 | ) | |
| 161,764 | |
Changes in operating assets and liabilities: | |
| | | |
| | |
Accounts receivable | |
| 553,887 | | |
| (4,677,726 | ) |
Inventory | |
| (4,402,549 | ) | |
| 1,087,558 | |
Other current assets | |
| 426,879 | | |
| 767,152 | |
Deposits and other assets | |
| 117,125 | | |
| (370,684 | ) |
Accounts payable | |
| (482,249 | ) | |
| 1,536,991 | |
Deferred revenue | |
| 170,776 | | |
| (1,323,025 | ) |
Operating lease liability | |
| (459,243 | ) | |
| (710,546 | ) |
Accrued expenses and other current liabilities | |
| (71,933 | ) | |
| (1,436,178 | ) |
Other liabilities | |
| 82,500 | | |
| - | |
Net cash flows used in operating activities | |
| (25,360,649 | ) | |
| (28,108,744 | ) |
| |
| | | |
| | |
CASH FLOWS FROM INVESTING ACTIVITIES | |
| | | |
| | |
Patent costs | |
| (22,030 | ) | |
| (62,281 | ) |
Purchase of equipment | |
| (1,606,358 | ) | |
| (94,972 | ) |
Proceeds from sale of equipment | |
| 1,700 | | |
| 33,568 | |
Purchase of software intangible | |
| (32,678 | ) | |
| - | |
Cash paid for Iron Drone asset acquisition | |
| - | | |
| (135,000 | ) |
Cash acquired on the acquisition of Airobotics Ltd. | |
| - | | |
| 1,049,454 | |
Cash paid for Field of View LLC asset acquisition | |
| - | | |
| (145,833 | ) |
Net cash flows provided by (used in) investing activities | |
| (1,659,366 | ) | |
| 644,936 | |
| |
| | | |
| | |
CASH FLOWS FROM FINANCING ACTIVITIES | |
| | | |
| | |
Proceeds from sale of noncontrolling interest in Ondas Networks, net of issuance costs | |
| 4,375,035 | | |
| 14,692,335 | |
Proceeds from sale of common stock, net of issuance costs | |
| 7,327,334 | | |
| - | |
Proceeds from exercise of options and warrants | |
| 8,702 | | |
| 10,791 | |
Proceeds from government grant | |
| 299,838 | | |
| 189,752 | |
Proceeds from convertible notes, net of issuance costs | |
| 1,482,868 | | |
| 9,309,513 | |
Proceeds from notes payable, net of issuance costs | |
| 1,377,524 | | |
| | |
Payments on convertible notes payable | |
| - | | |
| (4,354,911 | ) |
Payments on government grant liability | |
| - | | |
| (6,576 | ) |
Payments on loan payable | |
| - | | |
| (1,140,301 | ) |
Net cash flows provided by financing activities | |
| 14,871,301 | | |
| 18,700,603 | |
| |
| | | |
| | |
Decrease in cash, cash equivalents, and restricted cash | |
| (12,148,714 | ) | |
| (8,763,205 | ) |
Cash, cash equivalents, and restricted cash, beginning of period | |
| 15,022,000 | | |
| 29,775,096 | |
Cash, cash equivalents, and restricted cash, end of period | |
$ | 2,873,286 | | |
$ | 21,011,891 | |
| |
| | | |
| | |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: | |
| | | |
| | |
Cash paid for interest | |
$ | 16,845 | | |
$ | 163,418 | |
Cash paid for income taxes | |
$ | - | | |
$ | - | |
| |
| | | |
| | |
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | |
| | | |
| | |
Common Stock and warrants issued in relation to acquisition of Airobotics, Ltd. | |
$ | - | | |
$ | 5,962,628 | |
Common Stock issued in relation to acquisition of the assets of Iron Drone, Ltd. | |
$ | - | | |
$ | 85,800 | |
Common stock issued in exchange for debt repayment | |
$ | 2,079,375 | | |
$ | 7,320,284 | |
Noncash consideration for settlement of development agreement payable | |
$ | 342,428 | | |
$ | - | |
Warrants in Ondas Autonomous Systems, in relation to sale of common stock | |
$ | 954,737 | | |
$ | - | |
Warrants in Ondas Holdings, in relation to sale of common stock | |
$ | 2,198,559 | | |
$ | - | |
Warrants in relation to sale of redeemable preferred stock in Ondas Networks | |
$ | 1,471,194 | | |
$ | 12,683,549 | |
Warrants in Ondas Networks, in relation to note payable | |
$ | 589,924 | | |
$ | - | |
Preferred dividends attributable to redeemable noncontrolling interest | |
$ | 1,114,138 | | |
$ | 21,208 | |
Accretion of redeemable preferred stock in Ondas Networks | |
$ | 2,112,784 | | |
$ | 410,322 | |
Transfer of equipment into inventory | |
$ | 2,289,539 | | |
$ | - | |
Operating leases right-of-use assets obtained in exchange of lease liabilities | |
$ | - | | |
$ | 105,950 | |
ONDAS
HOLDINGS INC.
ADJUSTED
EBITDA RECONCILIATION
(Unaudited)
| |
Three Months Ended September 30, | |
| |
2024 | | |
2023 | |
| |
| | |
| |
Net Loss | |
$ | (9,526,268 | ) | |
$ | (7,292,461 | ) |
Depreciation | |
| 190,332 | | |
| 235,999 | |
Amortization | |
| 1,056,141 | | |
| 1,064,798 | |
Other expense, net | |
| 865,553 | | |
| 1,358,440 | |
Stock-based compensation | |
| 311,133 | | |
| (2,266,875 | ) |
Adjusted EBITDA | |
$ | (7,103,109 | ) | |
$ | (6,900,099 | ) |
ONDAS
HOLDINGS INC.
CASH
OPERATING EXPENSE RECONCILIATION
(Unaudited)
| |
Three Months Ended September 30, | |
| |
2024 | | |
2023 | |
| |
| | |
| |
Operating expenses | |
$ | 8,708,275 | | |
$ | 6,488,899 | |
Depreciation | |
| (190,332 | ) | |
| (235,999 | ) |
Amortization | |
| (1,056,141 | ) | |
| (1,064,798 | ) |
Stock-based compensation | |
| (311,133 | ) | |
| 2,266,875 | |
Cash operating expenses | |
$ | 7,150,669 | | |
$ | 7,454,977 | |
Exhibit 99.2
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_001.jpg)
Third Quarter 202 4 Earfiifigs Release Copyright 2024. All rights reserved. N A S D A Q : O N D S | N o v e m b e r 1 2 , 2 0 2 4
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_002.jpg)
N a s d a q : O N D S This presentation may contain "forward - looking statements" as that term is defined under the Private Securities Litigation Reform Act of 1995 (PSLRA), which statements may be identified by words such as "expects," "projects," "will," "may," "anticipates," "believes," "should," "intends," "estimates," and other words of similar meaning . Ondas Holdings Inc . (“Ondas” or the “Company”) cautions readers that forward - looking statements are predictions based on its current expectations about future events . These forward - looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict . The Company’s actual results, performance, or achievements could differ materially from those expressed or implied by the forward - looking statements as a result of a number of factors, including, the risks discussed under the heading “Risk Factors” in the Company’s most recent Annual Report on Form 10 - K filed with the U . S . Securities and Exchange Commission (“SEC”), in the Company’s Quarterly Reports on Form 10 - Q filed with the SEC, and in the Company’s other filings with the SEC . The Company undertakes no obligation to publicly update or revise any forward - looking statements, whether as a result of new information, future events or otherwise that occur after that date, except as required by law . Also, this presentation contains certain non - GAAP financial measures . For a description of these non - GAAP financial measures, including reconciliations to the most comparable measure under GAAP, see the Appendix to this presentation . Information in this presentation is not an offer to sell securities or the solicitation of an offer to buy securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction . 2 D i s c l a i m e r
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_003.jpg)
N a s d a q : O N D S Ag e f i da 3 • Introduction • F i n a nc i a l R e v i e w & O u t l o o k • B u s i n e s s U pd a t e • Ondas Networks • Ondas Autonomous Systems (OAS) • Closing Remarks • Q&A
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_004.jpg)
N a s d a q : O N D S M E I R K L I N E R PRESIDENT Meir is an entrepreneur with over 20 years of proven track record in aerospace development and manufacturing. GUY SIMPSON P R E S I D E N T & C O O Guy joined Ondas Networks in 2010 bringing over 25 years of leadership, operations and engineering experience. E R I C B R O C K C H A I R M A N & C E O Eric is an entrepreneur with over 25 years of management and investing experience. N E I L L A I R D I N T E R I M C F O , TREASURER & SECRETARY Neil is an experienced financial executive with over 25 years of performance in the technology sector which includes CFO roles with multiple publicly listed companies. L e a d e r s h i p T e a m 4
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_005.jpg)
N a s d a q : O N D S O v e r v i e w 5 S t r o n g f i n i s h t o 2 0 2 4 • Iron Drone and Optimus secure $14.4 million in military orders • Defense sector is new vertical for OAS with expanded TAM / SOM • Iron Drone Raider positioned as best - in - class C - UAS • Global customer pipeline maturing; American Robotics gaining traction • Growing demand for public safety; DFR market evolving • Ondas Networks – improved visibility with 900 MHz • Secured 900 MHz system - wide buildout with Metra in Chicago • Expanding 900 MHz program with Class I Railroad, also in Chicago • Visibility on network architecture plans for 900 MHz improved • Outlook remains positive; revenue recovery expected • OAS revenue driven by order backlog and pipeline maturation • Ondas Networks sees certain railroads signaling 900 MHz plans; seeking timelines and orders for 2025
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_006.jpg)
6 N a s d a q : O N D S K E Y F I N A N C I A L I N S I G H T S : • P&L reflects early stage of initial platform adoption for Ondas Networks and OAS • Revenue as expected due to extended timelines on 900 MHZ at Ondas Networks • Gross margin reflects subscale operations with low revenues and certain fixed costs in COGS • C a s h O P E X d o w n Y o Y (1) Refer to “Non - GAAP Financial Measures” Fifiaficial Review 6 T h r e e M o n t h s E n d e d S e p t e m b e r 30 , S E L E C T P & L D A T A 2023 2024 (Unaudited) $ 2 ,665,190 $ 1,480,792 R e v e nu e s , n e t 2,110,312 1,433,232 C o s t o f g oo d s s o l d 554,878 47,560 G r o s s p r of i t 6,488,899 8,708,275 Total operating expenses $ (5,934,021) $ (8,660,715) Operating Loss $ (7,292,461) $ (9,526,268) Net Loss $ 7,454,977 $ 7,150,669 C a s h O p e r a t i n g E x p e n s e s ( 1 ) $ (6,900,099) $ (7,103,109) A d j u s t e d E B I T D A ( 1 )
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_007.jpg)
N a s d a q : O N D S K E Y F I N A N C I A L I N S I G H T S : • Cash balance of $2.9 million • Cash used in operations decreased $2.7 million due to efficiencies including the business combination at OAS • Reflects increase of systems inventory at both business units • Cash provided by financing includes $6.95 million raised in Q3 2024 as detailed below: • $4.0 million gross proceeds in registered direct offering by Ondas Holdings (common stock) • $1.5 million gross proceeds raised by Ondas Networks (convertible loan) • $1.45 million gross proceeds raised by Ondas Networks (secured loan) 7 7 Fifiaficial Review N i n e M o n t h s E n d e d S e p t e m b e r 3 0 , S E L E C T C A S H F L OW D A T A 2023 2024 (Unaudited) $ (28,108,744) $ (25,360,649) Net cash used in operating activities 644,936 (1,659,366) Net cash provided by (used in) investing activities 18,700,603 14,871,301 Net cash provided by financing activities (8,763,205) (12,148,714) Decrease in cash 29,775,096 15,022,000 Cash, cash equivalents and restricted cash, beginning of period $ 21,011,891 $ 2,873,286 Cash, cash equivalents and restricted cash, end of period
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_008.jpg)
N a s d a q : O N D S K E Y F I N A N C I A L I N S I G H T S : • Convertible notes outstanding at Ondas Holdings total $27.8 million • Convertible notes outstanding at Ondas Networks total $1.5 million • Additional capital raised subsequent to September 30, 2024: • $ 3 . 5 million gross proceeds raised by OAS (convertible note) in financing led by Privet Ventures and Charles & Potomac • $ 500 , 000 in short - term working capital loan via KLEAR Inc . Balafice Sheet D e c . 3 1 , 2 0 2 3 S e p t . 3 0 , 2 02 4 S E L E C T B A L A N C E S H E E T D A T A (Unaudited) ASSETS $ 15,022,000 $ 2,873,286 C a s h a n d r e s t r i c t e d c a s h $ 92,164,682 $ 80,158,656 Total assets L I A B I L I T I E S A N D S T O C K H O L D E R S ' D E F I C IT $ 300,000 $ 1,191,215 Other debt - 1,486,847 Convertible notes - Networks, current 25,692,505 27,824,724 Convertible notes - Holdings, current 2,812,156 - Convertible notes - Holdings, long - term $ 28,804,661 $ 30,502,786 Total debt $ 47,108,861 $ 47,063,442 Total liabilities $ 11,920,694 $ 18,176,422 Redeemable noncontrolling interests $ 33,135,127 $ 14,918,792 Total Stockholders' equity $ 92,164,682 $ 80,158,656 Total liabilities and stockholders' equity 7 8
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_009.jpg)
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_010.jpg)
N a s d a q : O N D S 9 0 0 M H z – A T C S & d o t 1 6 U p d a t e 10 90 0 MH Z p l a n s c o m i n g i n t o f o c u s • Metra order reflects growing visibility in railroad 900 MHz plans • S ys t e m - w i d e u p g r a d e f o r 90 0 M H z A T C S n e t w o r k b e g i n s i n Q 4 20 2 4 • Class I Railroad ordered expanded 900 MHz deployment in Chicago • Live Airlink data traffic active since November 2023 • Class I Railroads signal intent to build mixed - use, multi - application network in 900 MHz • Railroads intend 900 MHz to be both a primary ATCS network, as well as a b a c k u p s ys t em f o r t h e 22 0 M H z P T C n e t w o r k • Railroads plan to move legacy 900 MHz CTC traffic to 220 MHz network in certain locations; a redundant path for ITCM traffic on the new 900 MHz is planned • AAR maintains commitment to build 900 MHz in FCC comment letter
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_011.jpg)
N a s d a q : O N D S S t r a t e g i c R o a d m a p 11 P u r su i n g d e p l o y me n t t i m e li n e s a n d o r d e rs • Supporting deployment of customer networks • Migration of multiple networks to new 900 MHz A - Block • Expect initial ITCM over 900 MHz field activity during Q4 • Execute on 220 MHz PTC data radio on behalf of Amtrak • Milestones achieved; first prototypes delivered in August • Development program to complete in Q1 2025 • E x p e d i t ed d e l i ve r y o f P T C d a t a r a d i o s i n Q 2 2 02 5 • Siemens UK program for on - locomotive data radio continues; prototypes to be delivered by end of the year • Next Generation HOT / EOT Testing with AAR in Progress • Continue prudent expense management
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_012.jpg)
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_013.jpg)
N a s d a q : O N D S OAS Update 13 OAS leverages growing investments in defense, homeland security and public safety capabilities • Secured $14.4 million in orders for Iron Drone and Optimus for military and homeland security applications • Established programs with major military customer • Advanced Iron Drone Raider capabilities and operational deployments with defense customers • E x ec u t e d f i x e d p r i c e c o n t r ac t f o r t h e U S C oa s t G u a r d f o r e m i s s i o n s m o n i t o r i n g a t P o rt s o f L A a n d L o n g B e ac h • C u s to m e r p i pe l i n e de e p e n i n g a n d m a t u r i n g i n U S a n d E u r o p e • Advanced marketing with additional customers • Public safety, ports and terminals • Data centers and construction project management • Multiple demonstrations and BVLOS waivers secured • Established a strategic alliance with GenLab Venture Studio
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_014.jpg)
N a s d a q : O N D S Goverfimefital Security Market A pivotal quarter with recorded high bookings of over $14 million U s e C a se Segment Product O r d e r A mo unt Description N e x t S t e ps B o r d e r / P e r i m e t e r S e c u r i ty B o r d e r / A s s e ts P r o t e c t i o n H o m e l a n d S e c u r i t y Defense Optimus I r o n D r o n e $5.4M $9.0M • I m p l e m e n t a t i on of f u l l y a u t o n omo u s a e r i a l p r o t e c t i on a n d surveillance under challenging environmental conditions • I n i t i a l s y s t e ms d e p l o y m e n t ( J u l y ) • Sp e c i f i c u p g r a d e s ( A u g u s t ) • M u l t i p l e l o c a t i o n s d e p l o y m e n t ( S e p t ) - F u l l d e p l o y m e n t ( Q 4 / Q 1 ) - E x p a n s i o n 2 0 2 5 – 2 0 2 6 - F u l l d e p l o y m e n t ( Q 4 / Q 1 ) - E x p a n s i o n 2 0 2 5 – 2 0 2 6 14
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_015.jpg)
N a s d a q : O N D S Market, Customer afid Product Expafisiofi Enhancing security and monitoring of critical facilities p r o j e c t s , p u b li c s a f e t y a n d m il i t a ry a s s e t s • Deliver and leverage Q3 bookings of the Iron Drone Raider and Optimus Systems • Advance specific upgrades in both systems • Execute on operational deployments; secure follow - on volume orders • Build supply chain and services infrastructure for sustainment • Capture new global defense customers • Fleet expansion in UAE expected to continue • Renewed and expanded service contract ; target 22 system fleet by end of 2025 • Potential for expanded commercial use cases in UAE • Drive Optimus adoption via American Robotics and our European partners • Demos in Europe with our partner HHLA SKY to potential customers • US police departments trending “Drone as a First Responder” 15
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_016.jpg)
N a s d a q : O N D S DFR Rapidly Evolvifig to Drofie Ififrastructure 16 16 Optimus is well positioned to provide public autonomous drone infrastructure required for scalable operations • Public safety drone adoption cycle is accelerating • A g en c i e s s e e i n g h u g e v a l u e f r o m d r o ne s – sa v i n g l i v e s • Autonomy unlocks scalable operations driving the next leg of growth • Municipalities seeking centralized drone operations across agencies • Scalable flight operations • Cost effective infrastructure investment • Optimus uniquely capable of meeting requirements • Type Certified UAV • Industrial grade reliability True Drone Infrastructure • Persistent availability (24x7); multi - functionality • Demonstrated multi - tenant success with Dubai Police and Intel DFR 3.0 _ _ _ _ _ __ Full Autonomy Remote Operations 24x7 One - to - Many Multi - Agency Shared Infrastructure
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_017.jpg)
N a s d a q : O N D S • Expect significant revenue recovery beginning in Q4 2024 • Delivering on OAS military orders; drive order book expansion • Advanced development programs; work with Railroads on 2025 buildout plans • Tracking demand for Optimus Systems from existing and new customers • Execute in field and build capacity to secure Iron Drone volume orders • Capitalize on security demand tailwinds for Optimus and Iron Drone platforms • Support additional Iron Drone orders with combat success • Optimus Systems orders from existing and new customers, including military • Accelerate a growing and maturing American Robotics pipeline • Management advancing funding strategy • Applied to Nasdaq for an 180 - day extension to meet minimum bid requirement Outlook F o c u s o n d e p l o y m e n t s a n d o p e r a t i o n a l s c a l e 17
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_018.jpg)
Third Quarter 2024 Earnings Release N A S D A Q : O N D S | N ov e m b e r 1 2 , 2 0 2 4 Q & A C o p y r i g h t 2 02 4 . A l l r i g h t s r e s e r v e d .
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_019.jpg)
19 N a s d a q : O N D S See the “Non - GAAP Financial Measures” section below. Appefidix Three Months Ended September 30, A D J U S T E D E B I T D A R E CO N C I L I A T I O N 2023 2024 (Unaudited) $ (7,292,461) $ (9,526,268) Net Loss 235,999 190,332 Depreciation Expense 1,358,440 865,553 Other Income (Expense), net 1,064,798 1,056,141 Amortization of Intangible Assets (2,266,875) 311,133 Stock Based Compensation $ (6,900,099) $ (7,103,109) Adjusted EBITDA (1) Three Months Ended September 30, C a s h O p e r a t i n g E x p e n s e R e c o n c il i a t i o n 2023 2024 (Unaudited) $ 6,488,899 $ 8,708,275 Total Operating Expense 235,999 190,332 Depreciation Expense 1,064,798 1,056,141 Amortization of Intangible Assets (2,266,875) 311,133 Stock Based Compensation $ 7,454,977 $ 7,150,669 T o t a l C a s h O p e r a t i n g E x p e n s e
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_020.jpg)
20 N a s d a q : O N D S As required by the rules of the Securities and Exchange Commission (“SEC”), we provide reconciliations of Earnings (Loss) before interest, depreciation, amortization, stock - based compensation and taxes (“Adjusted EBITDA”) and cash operating expenses, the non - GAAP financial measures contained in this presentation to the most directly comparable measures under GAAP, which reconciliations are set forth in the tables included in the Appendix of this presentation . We believe that Adjusted EBITDA and cash operating expenses facilitate the analysis of our ongoing business operations because they exclude items that may not be reflective of, or are unrelated to, the Company’s core operating performance, and may assist investors with comparisons to prior periods and assessing trends in our underlying businesses . Other companies may calculate Adjusted EBITDA and cash operating expenses differently, and therefore our measures may not be comparable to similarly titled measures used by other companies . Adjusted EBITDA and cash operating expenses should only be used as supplemental measures of our operating performance . We believe that Adjusted EBITDA improves comparability from period to period by removing the impact of our asset base (depreciation and amortization) and other adjustments as set out in the tables included in the Appendix of this presentation, which management has determined are not reflective of core operating activities and thereby assist investors with assessing trends in our underlying businesses . We believe that cash operating expenses is useful to manage expenses as it excludes non - cash items (depreciation expense, amortization expense and stock - based compensation expense) that may obscure our underlying business performance . Management uses Adjusted EBITDA and cash operating expenses in making financial, operating and planning decisions and evaluating the Company's ongoing performance . Nofi - GAAP Fifiaficial Measures
![](https://www.sec.gov/Archives/edgar/data/1646188/000121390024096228/ex99-2_021.jpg)
N a s d a q : O N D S 21 C o p y r i gh t 20 2 4 . A l l r i gh ts r e s e r v e d . N A S D A Q : O N D S | N o v e m b e r 1 2 , 2 0 2 4 T H A NK Y O U
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