HeartCore Enterprises reports FY24 EPS (7c) vs. (21c) last year

Reports revenue $30.4M vs. $21.8M last year. HeartCore CEO Sumitaka Kanno commented: “Over the past year, we made several strategic advancements in our software business model, all aimed at driving sustainable and predictable revenue growth, improving margins, and enhancing our ability to effectively cross-sell and upsell to our 1,000+ enterprise customers. While we are confident that the initiatives we have implemented will yield meaningful returns, we have also recognized that strategic acquisitions will be critical to maintaining our market leadership in Japan and sustaining our strong customer retention rate. With a well-established customer base built over the years, our acquisition strategy will primarily focus on deepening wallet share with each client we are engaged with, while seamlessly complementing and enhancing our existing suite of software solutions. This will include acquiring companies with synergistic technologies that align with our core offerings and leveraging effective use of AI to strengthen our value proposition and competitive edge. Outside of acquisitions, another key focus for HeartCore will be to accelerate the development of new products geared for global expansion in 2025, with the target launch aimed for the first half of 2026. Currently, only a small portion of our customer base consists of enterprises outside of Japan. By focusing on creating globally scalable solutions and enhancing our offerings with synergistic technologies through strategic acquisitions, we aim to expand our presence across international markets and drive additional growth in our software business. “Looking at our financial performance, we recorded approximately $7.2 million in impairment of goodwill and intangible asset, primarily related to our subsidiary, Sigmaways. While these losses impacted our full-year results, they are classified as one-time occurrences and are not expected to affect our financial performance in future quarters. To address this, we have already implemented several corrective measures, including separating Sigmaways’ liabilities and suspending all transactions with small venture companies to minimize any non-essential costs. While net loss for the year was $5.2 million, we believe a more relevant measure of our performance is adjusted EBITDA, which totaled $7.3 million for 2024, as it excludes the losses related to Sigmaways. Nevertheless, our subsidiaries continue to deliver synergistic technologies that enable us to effectively upsell and cross-sell to our shared clients. We believe that over the long term, as we continue to develop and innovate our solutions, acquire new technologies through M&A, and tap into mutual client portfolios across our partners and subsidiaries, we will drive positive outcomes for our financial performance. Outside of exploring synergistic M&A opportunities within our software business to fuel growth, we are also focused on expanding our Go IPO business. We recently announced our plans to extend our service into South Korea and have formed a strategic partnership with a venture fund in the region. To kick off this initiative, we will be hosting a seminar in September of this year. South Korea will be the first of several markets we aim to expand into across the APAC region, as IPO interests from foreign issuers have steadily increased over the years. Expanding beyond Japan’s borders marks a significant milestone for our Go IPO business, opening up new opportunities for us to leverage. To ensure successful market entry, we are actively seeking strategic partnerships, such as in South Korea, to gain access to their clientele portfolio that are interested in our services. We remain dedicated to executing both lines of business and look forward to our growth prospects throughout 2025.”