Datasea Inc. Reports 127.86% Revenue Growth to $41.54 Million Despite Net Loss

Datasea Inc. reported significant financial growth in its latest 10-Q filing for the six months ending December 31, 2024, with revenues reaching $41.54 million, a 127.86% increase compared to $18.23 million in the same period of 2023. The company attributed this growth primarily to the rapid expansion of its 5G AI multimodal digital business, which has solidified its position as a leader in the sector. Despite the revenue increase, Datasea recorded a net loss of approximately $3.10 million for the six months, up from a loss of $2.69 million in the prior year, indicating ongoing challenges in achieving profitability.

The company’s operational metrics also reflected substantial changes. Datasea's gross profit for the six months was $614,433, compared to $176,970 in the previous year, resulting in a gross margin improvement from 1.1% to 1.5%. This increase in gross profit was driven by higher sales volumes and a growing customer base. However, total operating expenses rose to $3.88 million, up from $2.82 million, largely due to increased general and administrative costs, which surged by 88.3% to $2.30 million, reflecting higher professional service fees and stock compensation expenses.

Strategically, Datasea has made notable advancements, including the acquisition of intangible assets and the establishment of new customer agreements. The company issued 1,932,224 shares to three non-U.S. investors, including its CEO, at a price of $2.06 per share, raising approximately $4 million to support future operations. Additionally, Datasea has expanded its product offerings in the acoustic high-tech sector, with plans to launch new products in 2025, including devices for environmental disinfection and cortisol regulation.

Operationally, Datasea has focused on enhancing its market presence, signing agreements with multiple beauty and healthcare companies to deploy its acoustic high-tech products across 463 stores. The company aims to sell approximately 140,000 units by the end of 2025, projecting revenue of around $17.8 million from these initiatives. Furthermore, Datasea has improved its cash position, ending the reporting period with $268,101 in cash, a 47.91% increase from the previous period, bolstered by successful financing activities.

Looking ahead, Datasea's management remains optimistic about its growth trajectory, emphasizing the importance of technological innovation and market expansion. The company plans to continue leveraging its core competencies in acoustic technology and 5G AI to drive future revenue growth, while also addressing its ongoing challenges related to profitability and operational efficiency.