Damon Inc. Reports Revenue Increase but Significant Net Loss Following Damon Motors Acquisition

Damon Inc., formerly known as Grafiti Holding Inc., reported its financial results for the three months ending September 30, 2024, revealing a revenue of $101,969, an increase from $97,908 in the same period last year. However, the company experienced a significant net loss of $1,564,540, compared to a much smaller loss of $3,692 in the prior year. This substantial increase in losses is attributed to higher operating expenses, particularly acquisition-related costs amounting to $1,085,297, following the recent business combination with Damon Motors Inc.

The company's total current assets decreased to $1,240,389 as of September 30, 2024, down from $1,691,943 at the end of the previous fiscal period. This decline was primarily driven by a reduction in cash reserves, which fell to $175,292 from $1,148,904. Current liabilities surged to $1,228,015, up from $644,999, largely due to increased accounts payable and accrued liabilities. As a result, Damon Inc. reported a stockholders' deficit of $1,959,401, a significant drop from $456,974 in the previous quarter.

Strategically, the company underwent a major transformation with the completion of its business combination with Damon Motors on November 13, 2024. This merger has positioned Damon Inc. to leverage Damon Motors' capabilities in the electric motorcycle market. The company also expanded its employee headcount, increasing from 3,600,001 shares issued and outstanding to 4,615,384 shares, reflecting the integration of Damon Motors into its operations.

Operationally, Damon Inc. is focusing on enhancing its product offerings and expanding its market presence. The company reported a notable increase in accounts receivable, which rose to $55,865 from $30,572, indicating a growing customer base. Additionally, the company has recognized deferred revenue of $151,377, suggesting a solid pipeline of future revenue from existing contracts. The management anticipates that the recent business combination will facilitate geographic expansion and improve product adoption rates in the electric vehicle sector.

Looking ahead, Damon Inc. is optimistic about its growth trajectory, bolstered by the recent financing commitments totaling $13 million secured in November 2024. The company aims to stabilize its operations and achieve profitability by capitalizing on the synergies from the Damon Motors acquisition. However, management has acknowledged the challenges posed by market conditions, including inflation and supply chain issues, which may impact future performance. The company remains committed to executing its strategic plans while navigating these uncertainties.