BEIJING, Nov. 13,
2023 /PRNewswire/ -- Datasea Inc. (NASDAQ: DTSS)
("Datasea" or the "Company"), a global technology company that
develops and provides products utilizing intelligent acoustics
including ultrasound, infrasound and directional sound, and
provides 5G messaging, today announced its financial results for
the first quarter ended September 30,
2023.
"Our first quarter results delivered strong performance with
revenue of approximately $6.8
million. The increase in revenue was mainly due to the rapid
increase of our 5G messaging business in China. For the current period, we
benefitted from our diversified communications portfolio, our
expanded addressable market and our continued improvement in
productivity. Our continuously optimized products and application
services that have been developed to match the real needs of
customers have brought steady order flow and income to the Company.
In addition, our customized systems and services have led to an
improvement in our 5G segment operating margins in the first
quarter of 2024."
"Datasea is currently transitioning from a China-focused company to one focused on
developing business operations in both the US and globally. We are
committed to transforming our business into an international
technology company with R&D, manufacturing facilities, sales
networks, and customer bases in the US and around the world. We
plan to provide leading-edge artificial intelligence solutions in
the field of acoustic intelligence as we contribute to the
development of this essential feature of the digital world on a
global scale," commented CEO Zhixin
Liu of Datasea.
First Quarter Fiscal
Year 2024 Financial Highlights
- Revenue was $6,880,743, driven by
rapid increase of 5G messaging business in China. For the three months ended September 30, 2023, revenues mainly consisted of
service fees from our 5G SMS service.
- Selling expenses were $84,447, a
decrease of 18.9% or $19,667, as
compared to the year-ago period. This is mainly due to the
strengthening of the Company's budgeting processes via in-depth
analysis of its market, products, and sales targets, while
strengthening the monitoring of its sales budget execution via
making timely adjustments.
- General and administration expenses were $693,060, a decrease of 21.7% or $191,900, as compared to the year-ago period.
This is mainly due to the Company's detailed management expense
plan, including budgeting and control objectives for various
management expenses, as well as corresponding control
measures.
- Capital reserve balances were $32,194,070, an increase of 33.5% or $8,071,097, as compared to $24,122,973 in the year-ago period. This was
mainly due to the increase in the issuance of shares by the Company
which provided the Company with funding for its strategic growth
objectives.
Operations Update
Acoustic Intelligence
Datasea is a developer and promoter of the concept of acoustic
intelligence and plans to introduce this cutting-edge technology
and its wide range of applications to China, US and globally.
International Business Expansion: Datasea established its
wholly-owned subsidiary, Datasea Acoustics LLC, in Delaware, USA in July
2023. Since then, DTSS has embarked on its mission of
developing leading and high-quality ultrasonic air sterilizers,
bathroom and cloakroom sterilizers, and odor removal products.
Further, it has engaged in the continuous development of new
products including ultrasonic Skin Repair Robots and Schumann
frequency sleep monitors for the US and global market.
Technology Collaborations: DTSS has entered into
collaborations with renowned research institutions both
domestically and internationally, such as the Medical Ultrasound
Project with the Chinese Academy of Sciences and the
ultrasound-based products for mental alertness and attention
enhancement. In addition, Datasea plans to foster collaborations
with renowned U.S. universities and research institutions through
its U.S. subsidiary. By partnering with these institutions, the
Company will engage in joint research and development initiatives
to create, develop and produce new intelligent acoustics
technologies. The Company believes that this collaborative approach
will help Datasea to develop and sustain a technological leadership
position in the ultrasonic, infrasound and directional sound
technology fields.
U.S. Patent Acquisition and Technology Protection:
Datasea prioritizes the acquisition of U.S. patents to protect its
innovations and intellectual property. Our attainment of U.S.
patents for our technologies is essential to maintain our
competitive advantage and defend against potential infringement. We
believe that this proactive approach in patent acquisition will
ensure that Datasea's intellectual property remains protected in
the U.S. market and provide opportunities for licensing and
monetization. Currently, the Company is actively engaged in
obtaining U.S. patents through collaboration with a renowned
intellectual property firm. We aim to build an intellectual
property matrix in the United
States and on an international scale.
Marketing and sales expansion. Datasea plans to
actively seek long-term contracts and collaborations with domestic
and international customers, partners, and major corporate clients.
On October 16, 2023, its Delaware operating entity, Datasea Acoustics
LLC, entered into a marketing promotion and sales cooperation
agreement with Meglio Interiors LLC ("Meglio"), based in
Chamblee, Georgia to develop,
promote and distribute the Company's intelligent acoustics products
in the US and internationally. Datasea plans to establish an
assembly line in the near future for its intelligent acoustics
products in Delaware and it is
planned that Meglio will be a primary distributor of such products.
In terms of our current sales activities, we have engaged in
discussions with potential clients such as New York real estate developers and
Philadelphia educational
institutions. These collaborations can encompass product sales,
technical cooperation, and joint research and development, which
will help DTSS to develop revenue and market share.
5G Messaging
Marketing and sales expansion. Datasea is one of the
first movers in the 5G messaging industry in China and has built a comprehensive 5G
messaging product portfolio with high brand recognition. The
Company adopted an integrated sales strategy to boost sales to
better promote business development and meet with the demand of
customers.
Key Customers and Agreements. Datasea's 5G messaging
solutions have been adopted by leading companies across 11
industries, including express, health care, retail and
tourism. As of September 30,
2023, Datasea's Chinese operating entities, Shuhai
Information Technology Co., Ltd. ("Shuhai Beijing") and its
subsidiaries have reached agreements with several new clients,
Hainuo Xintong (Qingdao) Network
Technology Co., Ltd. (hereinafter referred to as "Hainuo") and
Xiamen Duoqiao Mai Network Technology Co., Ltd. (hereinafter
referred to as "Xiamen Duoqiao"). In just a few months after
signing agreements with Hainuo Xintong and Xiamen Duoqiao, Shuhai
Beijing and its subsidiaries provided a 5G message top up service
worth approximately $8.1 million (or
RMB 57.99 million). From May 2023 to September
2023, the revenue from Maiduoqiao is valued at $6.2 million (or RMB
44.51million). From August
2023 to September 2023, the
revenue from Hainuo Xintong is $1.9
million (equivalent to RMB
13.5 RMB). Also, Datasea's Chinese operating entity,
Guozhong Times (Beijing) Technology Co., Ltd., has reached an
agreement with a new client, Qingdao Ruicheng Lida Network
Technology Co., Ltd. As of September 30,
2023, Shuhai Beijing and its subsidiaries have provided 5G
message top up services worth approximately $0.8 million (or RMB 5.6
million).
About Datasea Inc.
Datasea Inc. ("Datasea") is a leading provider of products,
services, and solutions for enterprise and retail customers in
converging and innovative industries, Intelligent Acoustics and 5G
messaging, especially focusing on ultrasonic, infrasound and
directional sound technology. The Company's advanced R&D
technology serves as the core infrastructure and backbone for its
products. Its 5G Messaging segment operates on a cloud platform
based on AI. Datasea leverages cutting-edge technologies in
intelligent acoustics, utilizing ultrasonic sterilization to combat
viruses and prevent human infections, and is also developing
innovations in directional sound and medical ultrasonic
cosmetology. In July 2023, Datasea
established a wholly-owned subsidiary, Datasea Acoustics LLC, in
Delaware, in a strategic move to
mark its global presence. This underlies Datasea's commitment to
Intelligent Acoustics and its intent to offer leading-edge acoustic
solutions to the US market. For additional information, please
visit: www.dataseainc.com.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 21E of the Securities Exchange Act of 1934
and as defined in the U.S. Private Securities Litigation Reform Act
of 1995. These forward-looking statements can be identified by
terminology such as "will", "expects", "anticipates", "future",
"intends", "plans", "believes", "estimates", "target", "going
forward", "outlook," "objective" and similar terms. Such statements
are based upon management's current expectations and current market
and operating conditions, and relate to events that involve known
or unknown risks, uncertainties and other factors, all of which are
difficult to predict and which are beyond Datasea's control, which
may cause Datasea's actual results, performance or
achievements (including the RMB/USD value of its anticipated
benefit to Datasea as described herein) to differ materially and in
an adverse manner from anticipated results contained or implied in
the forward-looking statements. Further information regarding these
and other risks, uncertainties or factors is included in Datasea's
filings with the U.S. Securities and Exchange Commission, which are
available at www.sec.gov. Datasea does not undertake any obligation
to update any forward-looking statement as a result of new
information, future events or otherwise, except as required under
law.
Datasea investor and media Contact:
Email: investorrelations@shuhaixinxi.com
DATASEA INC.
CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(UNAUDITED)
|
|
|
|
|
|
THREE MONTHS
ENDED SEPTEMBER
30,
|
|
|
|
2023
|
|
|
2022
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
6,880,743
|
|
|
$
|
-
|
|
Cost of goods
sold
|
|
|
6,806,008
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Gross profit
|
|
|
74,735
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
|
Selling
|
|
|
84,447
|
|
|
|
104,114
|
|
General and administrative
|
|
|
693,060
|
|
|
|
884,960
|
|
Research and development
|
|
|
155,004
|
|
|
|
106,628
|
|
|
|
|
|
|
|
|
|
|
Total operating
expenses
|
|
|
932,511
|
|
|
|
1,095,702
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations
|
|
|
(857,776)
|
|
|
|
(1,095,702)
|
|
|
|
|
|
|
|
|
|
|
Non-operating income
(expenses)
|
|
|
|
|
|
|
|
|
Other expenses
|
|
|
(7,864)
|
|
|
|
(1,239)
|
|
Interest income
|
|
|
106
|
|
|
|
64
|
|
|
|
|
|
|
|
|
|
|
Total non-operating
expenses, net
|
|
|
(7,758)
|
|
|
|
(1,175)
|
|
|
|
|
|
|
|
|
|
|
Loss before income
tax
|
|
|
(865,534)
|
|
|
|
(1,096,877)
|
|
|
|
|
|
|
|
|
|
|
Income tax
|
|
|
-
|
|
|
|
8
|
|
|
|
|
|
|
|
|
|
|
Loss before
noncontrolling interest from continuing operation
|
|
|
(865,534)
|
|
|
|
(1,096,885)
|
|
Loss before
noncontrolling interest from discontinued operation
|
|
|
833,546
|
|
|
|
(337,062)
|
|
|
|
|
|
|
|
|
|
|
Less: loss attributable
to noncontrolling interest from continuing operation
|
|
|
(9,932)
|
|
|
|
5,135
|
|
Less: loss attributable
to noncontrolling interest from discontinued operation
|
|
|
-
|
|
|
|
(101,759)
|
|
|
|
|
|
|
|
|
|
|
Net loss attribute to
noncontrolling interest
|
|
|
(9,932)
|
|
|
|
(96,624)
|
|
|
|
|
|
|
|
|
|
|
Net loss to the Company
from continuing operation
|
|
|
(855,602)
|
|
|
|
(1,102,020)
|
|
Net loss to the Company
from discontinued operation
|
|
|
833,546
|
|
|
|
(235,303)
|
|
|
|
|
|
|
|
|
|
|
Net loss to the
Company
|
|
|
(22,056)
|
|
|
|
(1,337,323)
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
item
|
|
|
|
|
|
|
|
|
Foreign currency
translation gain (loss) attributable to the Company
|
|
|
(161,216)
|
|
|
|
12,338
|
|
Foreign currency
translation gain (loss) attributable to noncontrolling
interest
|
|
|
29,734
|
|
|
|
(3,690)
|
|
|
|
|
|
|
|
|
|
|
Comprehensive loss
attributable to the Company
|
|
$
|
(183,272)
|
|
|
$
|
(1,324,985)
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income
(loss) attributable to noncontrolling interest
|
|
$
|
19,802
|
|
|
$
|
(100,314)
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net
loss per share
|
|
$
|
(0.00)
|
|
|
$
|
(0.05)
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
used for computing basic and diluted loss per share
|
|
|
29,445,992
|
|
|
|
24,324,633
|
|
DATASEA INC.
CONSOLIDATED BALANCE
SHEETS
|
|
|
|
|
|
SEPTEMBER 30,
2023
(UNAUDITED)
|
|
|
JUNE 30,
2023
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
|
|
Cash
|
|
$
|
1,218,748
|
|
|
$
|
19,728
|
|
Accounts receivable
|
|
|
22,158
|
|
|
|
255,725
|
|
Inventory, net
|
|
|
242,789
|
|
|
|
241,380
|
|
Value-added tax prepayment
|
|
|
70,115
|
|
|
|
71,261
|
|
Prepaid expenses and other current assets
|
|
|
6,358,043
|
|
|
|
701,423
|
|
Total current
assets
|
|
|
7,911,853
|
|
|
|
1,289,517
|
|
|
|
|
|
|
|
|
|
|
NONCURRENT
ASSETS
|
|
|
|
|
|
|
|
|
Long-term investment
|
|
|
55,713
|
|
|
|
55,358
|
|
Property and equipment, net
|
|
|
67,700
|
|
|
|
85,930
|
|
Intangible assets, net
|
|
|
715,079
|
|
|
|
1,185,787
|
|
Right-of-use assets, net
|
|
|
65,854
|
|
|
|
137,856
|
|
Total noncurrent
assets
|
|
|
904,346
|
|
|
|
1,464,931
|
|
|
|
|
|
|
|
|
|
|
TOTAL
ASSETS
|
|
$
|
8,816,199
|
|
|
$
|
2,754,448
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
296,177
|
|
|
$
|
1,005,059
|
|
Short term loan
|
|
|
496,035
|
|
|
|
594,906
|
|
Unearned revenue
|
|
|
473,061
|
|
|
|
609,175
|
|
Accrued expenses and other payables
|
|
|
642,294
|
|
|
|
1,409,939
|
|
Due to related parties
|
|
|
494,927
|
|
|
|
1,162,856
|
|
Operating lease liabilities
|
|
|
34,367
|
|
|
|
124,640
|
|
Loan payables - current
|
|
|
2,032,920
|
|
|
|
-
|
|
Total current
liabilities
|
|
|
4,469,781
|
|
|
|
4,906,575
|
|
|
|
|
|
|
|
|
|
|
NONCURRENT
LIABILITIES
|
|
|
|
|
|
|
|
|
Operating lease liabilities
|
|
|
17,781
|
|
|
|
26,449
|
|
Loan payables - non-current
|
|
|
20,560
|
|
|
|
1,401,521
|
|
Total noncurrent
liabilities
|
|
|
38,341
|
|
|
|
1,427,970
|
|
|
|
|
|
|
|
|
|
|
TOTAL
LIABILITIES
|
|
|
4,508,122
|
|
|
|
6,334,545
|
|
|
|
|
|
|
|
|
|
|
COMMITMENTS AND
CONTINGENCIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS' EQUITY
(DEFICIT)
|
|
|
|
|
|
|
|
|
Common stock, $0.001 par value, 375,000,000 shares
authorized, 38,073,234
and 27,784,133 shares issued and
outstanding as of September 30, 2023 and
June 30, 2023,
respectively
|
|
|
38,073
|
|
|
|
27,784
|
|
Additional paid-in capital
|
|
|
32,194,070
|
|
|
|
24,122,973
|
|
Accumulated comprehensive income
|
|
|
232,036
|
|
|
|
393,252
|
|
Accumulated deficit
|
|
|
(28,085,314)
|
|
|
|
(28,063,258)
|
|
TOTAL COMPANY
STOCKHOLDERS' EQUITY (DEFICIT)
|
|
|
4,378,865
|
|
|
|
(3,519,249)
|
|
|
|
|
|
|
|
|
|
|
Noncontrolling interest
|
|
|
(70,788)
|
|
|
|
(60,848)
|
|
|
|
|
|
|
|
|
|
|
TOTAL EQUITY
(DEFICIT)
|
|
|
4,308,077
|
|
|
|
(3,580,097)
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES
AND EQUITY (DEFICIT)
|
|
$
|
8,816,199
|
|
|
$
|
2,754,448
|
|
DATASEA INC.
CONSOLIDATED
STATEMENTS OF CASH FLOWS
(UNAUDITED)
|
|
|
|
|
|
Common
Stock
|
|
|
Additional
paid-in
|
|
|
Accumulated
|
|
|
Accumulated
other
comprehensive
|
|
|
|
|
|
Noncontrolling
|
|
|
|
Shares
|
|
|
Amount
|
|
|
capital
|
|
|
deficit
|
|
|
income
|
|
|
Total
|
|
|
interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at July
1, 2023
|
|
|
27,784,133
|
|
|
$
|
27,784
|
|
|
$
|
24,122,973
|
|
|
$
|
(28,063,258)
|
|
|
$
|
393,252
|
|
|
$
|
(3,519,249)
|
|
|
$
|
(60,848)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(22,056)
|
|
|
|
-
|
|
|
|
(22,056)
|
|
|
|
(9,932)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of
common
stock for
equity
financing
|
|
|
10,289,101
|
|
|
|
10,289
|
|
|
|
8,050,997
|
|
|
|
-
|
|
|
|
-
|
|
|
|
8,061,286
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares issued
for stock
compensation
expense
|
|
|
-
|
|
|
|
-
|
|
|
|
20,100
|
|
|
|
-
|
|
|
|
-
|
|
|
|
20,100
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign
currency
translation
loss
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(161,216)
|
|
|
|
(161,216)
|
|
|
|
(8)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at
September
30, 2023
|
|
|
38,073,234
|
|
|
$
|
38,073
|
|
|
$
|
32,194,070
|
|
|
$
|
(28,085,314)
|
|
|
$
|
232,036
|
|
|
$
|
4,378,865
|
|
|
$
|
(70,788)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at July
1, 2022
|
|
|
24,324,633
|
|
|
$
|
24,325
|
|
|
$
|
20,729,559
|
|
|
$
|
(18,583,566)
|
|
|
$
|
283,587
|
|
|
$
|
2,453,905
|
|
|
$
|
(854,273)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(1,337,323)
|
|
|
|
-
|
|
|
|
(1,337,323)
|
|
|
|
(96,624)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares issued
for stock
compensation
expense
|
|
|
-
|
|
|
|
-
|
|
|
|
116,250
|
|
|
|
-
|
|
|
|
-
|
|
|
|
116,250
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign
currency
translation
gain (loss)
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
12,338
|
|
|
|
12,338
|
|
|
|
(3,690)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at
September
30, 2022
|
|
|
24,324,633
|
|
|
$
|
24,325
|
|
|
$
|
20,845,809
|
|
|
$
|
(19,920,889)
|
|
|
$
|
295,925
|
|
|
$
|
1,245,170
|
|
|
$
|
(954,587)
|
|
IMPORTANT NOTICE TO USERS (summary only, please refer to
the Form 10-Q for full text of notice); All information is
unaudited unless otherwise noted or accompanied by an audit opinion
and is subject to the more comprehensive information contained in
our SEC reports and filings. We do not endorse third-party
information. All information speaks as of the last fiscal quarter
or year for which we have filed a Form 10-K or 10-Q, or for
historical information the date or period expressly indicated in or
with such information. We undertake no duty to update the
information. Forward-looking statements are subject to risks and
uncertainties described in our Forms 10-Q and 10-K.
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SOURCE Datasea Inc.