Wearable Devices Ltd. (Nasdaq: WLDS) (“Wearable Devices” or the
“Company”), a growth company developing a non-invasive neural input
interface technology for B2B and B2C customers, today announced its
financial results for the six months ended June 30, 2022.
Wearable Devices continued its investment in
research and development activities and together with the expenses
incurred in connection with the Company’s initial public offering
(“IPO”), the Company’s net loss increased to $(2,051,000), or
$(0.18) per diluted share, for the six months ended June 30, 2022,
as compared to a net loss of $(640,000), or $(0.08) per diluted
share for the six months ended June 30, 2021.
As previously announced, on September 15, 2022,
the Company closed its IPO of 3,750,000 units. Each unit was
offered at a public offering price of $4.25 and consisted of one
ordinary share and two warrants to purchase one ordinary share
each, at an initial exercise price of $4.00 per ordinary share. In
addition, the underwriter for the IPO partially exercised its
over-allotment option with respect to 1,125,000 warrants to
purchase 1,125,000 ordinary shares. The gross proceeds of the
offering were approximately $16 million before deducting
underwriting discounts, commissions and offering expenses.
Commenting on the IPO and the upcoming goals of
the Company, Mr. Asher Dahan, Chairman of the Board and Chief
Executive Officer of Wearable Devices, said, “We are thankful to
all our investors and very excited about the successful IPO, which
is an important step as we bring to market revolutionary solutions
that enable the user’s hand to become a universal input device for
touchless interaction with technology. We believe that neural-based
interfaces will become as common to interaction with wearable
computing and digital devices in the near future as the touchscreen
is a universal input method for smartphones. This IPO enables us to
drive the development of our innovative technology for B2B
customers and transition to production on our B2C wearable Mudra
wrist band for controlling digital devices using subtle finger
movements.
With the Metaverse widely considered to be the
future of the internet, we believe the neural control interface
market is positioned for growth given that user interfaces
frequently dictate the pace of technology advancements. On the B2B
side, more than 100 companies have purchased our Mudra Inspire
development kit, and 30 of those are multinational technology
companies. These companies are exploring various input and control
use-cases for their products, across multiple countries and
industry sectors, including consumer electronics manufacturers,
consumer electronics brands, electronic components manufacturers,
IT services and software development companies, industrial
companies, and utility providers. Our objective with these
companies is to commercialize the Mudra technology by licensing it
for integration in the hardware and software of these companies’
products and services.
On the B2C side of our business, we are
launching a smart band for the Apple Watch which allows users to
control the watch and operate applications using same-hand
touchless finger movements. We plan to utilize IPO proceeds
in part to deliver pre-orders of our Mudra Band and to solidify
production capabilities and volumes. In parallel, we intend to
increase our marketing efforts to further expand global awareness
of our brand,” said Mr. Dahan.
About Wearable
Devices Ltd.
Wearable Devices is a growth company developing
a non-invasive neural input interface technology in the form of a
wrist wearable band for controlling digital devices using subtle
finger movements. Our company’s vision is to create a world in
which the user’s hand becomes a universal input device for
touchlessly interacting with technology, and we believe that our
technology is setting the standard input interface for the
Metaverse. Since our technology was introduced to the market, we
have been working with both Business-to-Business and
Business-to-Consumer customers as part of our push-pull strategy.
Combining our own proprietary sensors and Artificial Intelligence,
or AI, algorithms into a stylish wristband, our Mudra platform
enables users to control digital devices through subtle finger
movements and hand gestures, without physical touch or contact. For
more information, visit https://www.wearabledevices.co.il/.
Forward-Looking Statement
Disclaimer
This press release contains “forward-looking
statements” within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended, that are intended to be covered by the “safe
harbor” created by those sections. Forward-looking statements,
which are based on certain assumptions and describe our future
plans, strategies and expectations, can generally be identified by
the use of forward-looking terms such as “believe,” “expect,”
“may,” “should,” “could,” “seek,” “intend,” “plan,” “goal,”
“estimate,” “anticipate” or other comparable terms. For example, we
are using forward-looking statements when we are discussing our
beliefs regarding the neural control interface market position,
Metaverse being the future of the internet, our technological
capabilities and our future financial performance. All statements
other than statements of historical facts included in this press
release regarding our strategies, prospects, financial condition,
operations, costs, plans and objectives are forward-looking
statements. Forward-looking statements are neither historical facts
nor assurances of future performance. Instead, they are based only
on our current beliefs, expectations and assumptions regarding the
future of our business, future plans and strategies, projections,
anticipated events and trends, the economy and other future
conditions. Because forward-looking statements relate to the
future, they are subject to inherent uncertainties, risks and
changes in circumstances that are difficult to predict and many of
which are outside of our control. Our actual results and financial
condition may differ materially from those indicated in the
forward-looking statements. Therefore, you should not rely on any
of these forward-looking statements. Important factors that could
cause our actual results and financial condition to differ
materially from those indicated in the forward-looking statements
include, among others, the following: our use of proceeds from the
offering; the trading of our ordinary shares or warrants and the
development of a liquid trading market; our ability to successfully
market our products and services; the acceptance of our products
and services by customers; our continued ability to pay operating
costs and ability to meet demand for our products and services; the
amount and nature of competition from other security and telecom
products and services; the effects of changes in the cybersecurity
and telecom markets; our ability to successfully develop new
products and services; our success establishing and maintaining
collaborative, strategic alliance agreements, licensing and
supplier arrangements; our ability to comply with applicable
regulations; and the other risks and uncertainties described in the
prospectus dated September 12, 2022 and our other filings with the
SEC. We undertake no obligation to publicly update any
forward-looking statement, whether written or oral, that may be
made from time to time, whether as a result of new information,
future developments or otherwise.
Investor Contact:
John Nesbett/Jennifer BelodeauIMS Investor
Relations203.972.9200wearablesdevices@imsinvestorrelations.com
WEARABLE
DEVICES LTD. AND ITS SUBSIDIARY |
|
CONDENSED CONSOLIDATED INTERIM BALANCE SHEETS |
U.S. dollars (in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
|
December 31, |
|
|
|
2022 |
|
|
2021 |
|
ASSETS |
|
Unaudited |
|
|
|
|
|
|
|
|
|
|
|
CURRENT ASSETS: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash |
|
320 |
|
|
1,274 |
|
Trade receivables |
|
17 |
|
|
8 |
|
Governmental grant receivable |
|
55 |
|
|
62 |
|
Other receivables and prepaid expenses |
|
18 |
|
|
47 |
|
Deferred initial public offering cost |
|
25 |
|
|
- |
|
Inventories |
|
8 |
|
|
11 |
|
|
|
|
|
|
|
|
TOTAL CURRENT ASSETS |
|
443 |
|
|
1,402 |
|
|
|
|
|
|
|
|
NON-CURRENT ASSETS: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Right-of-use
asset |
|
25 |
|
|
- |
|
Property and
equipment, net |
|
47 |
|
|
43 |
|
|
|
|
|
|
|
|
TOTAL NON-CURRENT ASSETS |
|
72 |
|
|
43 |
|
|
|
|
|
|
|
|
TOTAL ASSETS |
|
515 |
|
|
1,445 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEARABLE
DEVICES LTD. AND ITS SUBSIDIARY |
|
CONDENSED CONSOLIDATED INTERIM BALANCE SHEETS |
U.S.
dollars (in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
|
December 31, |
|
|
|
2022 |
|
|
2021 |
|
LIABILITIES AND SHAREHOLDERS' EQUITY
(DEFICIT) |
|
Unaudited |
|
|
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
|
|
|
Accounts payables |
|
88 |
|
|
72 |
|
Advance payments |
|
284 |
|
|
273 |
|
Deferred revenues |
|
23 |
|
|
24 |
|
Accrued payroll and other employment related accruals |
|
293 |
|
|
222 |
|
Accrued expenses |
|
170 |
|
|
47 |
|
Lease liability |
|
25 |
|
|
- |
|
SAFEs |
|
500 |
|
|
- |
|
TOTAL CURRENT LIABILITIES |
|
1,383 |
|
|
638 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS' EQUITY (DEFICIT) |
|
|
|
|
|
|
Ordinary shares, NIS 0.01 par value: |
|
|
|
|
|
|
Authorized 20,000,000 and 50,000,000 as of December 31, 2021 and
June 30, 2022, respectively; Issued and outstanding 11,136,850
shares as of December 31, 2021 as of June 30, 2022 |
|
31 |
|
|
31 |
|
Additional paid-in capital |
|
8,065 |
|
|
7,689 |
|
Accumulated losses |
|
(8,964 |
) |
|
(6,913 |
) |
|
|
|
|
|
|
|
TOTAL SHAREHOLDERS’ EQUITY (DEFICIT) |
|
(868 |
) |
|
807 |
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
(DEFICIT) |
|
515 |
|
|
1,445 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEARABLE
DEVICES LTD. AND ITS SUBSIDIARY |
|
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE
LOSS (UNAUDITED) |
U.S.
dollars (in thousands) |
|
|
|
|
|
|
|
|
|
|
|
Six
months |
|
Six
months |
|
|
ended |
|
ended |
|
|
June
30, |
|
June
30, |
|
|
2022 |
|
2021 |
|
|
|
|
|
|
|
|
|
|
|
|
U.S.
dollars |
|
|
in
thousands |
|
|
(except per share amounts) |
|
|
|
|
|
Revenues |
|
28 |
|
|
107 |
|
Cost of
materials |
|
(5 |
) |
|
(7 |
) |
Research and
development, net |
|
(944 |
) |
|
(388 |
) |
Sales and
marketing expenses, net |
|
(471 |
) |
|
(130 |
) |
General and
administrative expenses |
|
(587 |
) |
|
(188 |
) |
Initial
public offering expenses |
|
(74 |
) |
|
- |
|
OPERATING LOSS |
|
(2,053 |
) |
|
(606 |
) |
FINANCING INCOME (EXPENSES),net |
|
2 |
|
|
(34 |
) |
COMPREHENSIVE AND NET LOSS |
|
(2,051 |
) |
|
(640 |
) |
|
|
|
|
|
Net
loss per ordinary share, basic and diluted |
|
(0.18 |
) |
|
(0.08 |
) |
Weighted average number of ordinary shares outstanding
basic and diluted |
|
11,136,850 |
|
|
8,282,329 |
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS
(UNAUDITED) |
U.S.
dollars (in thousands) |
|
|
|
|
|
|
|
|
|
|
|
Six months
ended |
|
|
June
30, |
|
|
2022 |
|
|
2021 |
|
CASH
FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
Net
loss |
|
(2,051 |
) |
|
(640 |
) |
|
|
|
|
|
Adjustments
required to reconcile net loss to net cash used in |
|
|
|
|
operating
activities - |
|
|
|
|
|
|
|
|
|
Depreciation |
|
11 |
|
|
4 |
|
Share based
compensation expenses |
|
376 |
|
|
62 |
|
Accrued
interest on convertible securities |
|
- |
|
|
21 |
|
|
|
|
|
|
Changes in
operating assets and liabilities items: |
|
|
|
|
Decrease in
inventory |
|
3 |
|
|
5 |
|
Increase in
trade receivables |
|
(9 |
) |
|
- |
|
Increase in
deferred initial public offering cost |
|
(25 |
) |
|
- |
|
Decrease
(increase) in governmental grants receivables |
|
7 |
|
|
(104 |
) |
Decrease
(increase) in other receivables and prepaid expenses |
|
29 |
|
|
(44 |
) |
Increase in
advance payments |
|
11 |
|
|
102 |
|
Increase
(decrease) in deferred revenues |
|
(1 |
) |
|
2 |
|
Increase in
accounts payable |
|
16 |
|
|
18 |
|
Increase in
accrued payroll and other employment related accruals |
|
71 |
|
|
117 |
|
Decrease in
advance payments on governmental grants |
|
- |
|
|
(42 |
) |
Increase in
accrued expenses |
|
123 |
|
|
8 |
|
Net cash
used in operating activities |
|
(1,439 |
) |
|
(491 |
) |
|
|
|
|
|
CASH
FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
Purchase of
property and equipment |
|
(15 |
) |
|
(14 |
) |
Net cash
used in investing activities |
|
(15 |
) |
|
(14 |
) |
CASH
FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
Proceeds
from issuance of ordinary shares and warrants, net of issuance
cost |
|
- |
|
|
2,925 |
|
Proceeds
from issuance of SAFEs |
|
500 |
|
|
- |
|
Exercise of
options to ordinary shares |
|
- |
|
|
1 |
|
Net cash
provided by financing activities |
|
500 |
|
|
2,926 |
|
|
|
|
|
|
NET
INCREASE (DECREASE) IN CASH |
|
(954 |
) |
|
2,421 |
|
CASH
AT BEGINNING OF PERIOD |
|
1,274 |
|
|
475 |
|
CASH
AT END OF PERIOD |
|
320 |
|
|
2,896 |
|
|
|
|
|
|
SUPPLEMENTAL DISCLOSURES OF CASH FLOW
INFORMATION: |
|
|
|
|
Conversion of convertible securities into ordinary shares |
|
- |
|
|
3,072 |
|
Right-of-use asset recognized against lease liability |
|
56 |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
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