Safe Pro Group Inc. reported a significant decline in financial performance for the first quarter of 2025, with total revenues of $184,802, down 39.9% from $307,653 in the same period of 2024. The decrease was primarily driven by a reduction in both product sales, which fell to $140,600 from $222,356, and service revenues, which dropped to $44,202 from $85,297. The company attributed this decline to budgetary cuts in federal funding for security services, which it expects to be temporary until a new budget is approved.
The company's gross profit also decreased sharply, falling to $61,566 from $127,215, resulting in a gross margin of 33.3% compared to 41.4% in the prior year. Total operating expenses surged to $4,067,256, a 235.6% increase from $1,212,101, largely due to a substantial rise in salary, wages, and payroll taxes, which included stock-based compensation. The net loss for the quarter was $3,965,017, compared to a loss of $1,143,860 in the same quarter of 2024, marking a 246.6% increase in losses.
In terms of operational metrics, Safe Pro Group's cash position decreased significantly, with cash on hand dropping to $912,219 from $1,970,719 at the end of 2024. Current assets also fell by 46% to $1,485,653, while total assets decreased by 25.5% to $3,686,590. The company reported a working capital of $613,628, down from $1,856,203, indicating a tightening liquidity position.
Strategically, Safe Pro Group has been focusing on expanding its product offerings and enhancing its technology capabilities. The company has invested in its AI-powered software, SpotlightAI, which is designed for processing aerial imagery. Additionally, the company is actively seeking new customers in the private sector to diversify its revenue streams. On May 9, 2025, Safe Pro Group closed a private offering, raising $1.05 million through the sale of Series C convertible preferred stock, which is expected to support its operations and growth initiatives.
Looking ahead, management remains cautious but optimistic about future revenue growth, anticipating a return to normal revenue levels in the second quarter of 2025 as new contracts are secured and existing customer relationships are strengthened. However, the company acknowledges the ongoing challenges posed by market conditions and the need for continued capital to support its operations.
About Safe Pro Group Inc.
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