20-F: Siyata Mobile Reports FY2024 Results, Announces Merger with Core Gaming

Siyata Mobile reports a 41.3% revenue increase for FY2024 and announces a merger with Core Gaming, aiming to expand into the mobile gaming market.

Summary

• Siyata Mobile Inc. reported a 41.3% increase in revenue for the year ended December 31, 2024, reaching $11.63 million compared to $8.23 million in 2023.
• The increase in revenue was primarily driven by a $4.42 million increase in rugged device sales, offset by a $1.03 million decrease in booster sales.
• Gross margin decreased to 18.4% in 2024 from 32.3% in 2023, attributed to negative margins on EMEA sales and increased handling costs.
• The company experienced a net loss of $25.27 million for 2024, compared to a net loss of $12.93 million in 2023.
• Siyata announced a merger agreement with Core Gaming, Inc., a mobile gaming developer, on February 26, 2025.
• The merger aims to diversify Siyata's business into the mobile gaming market, with Core Gaming shareholders expected to own approximately 90% of the combined company.
• The company has been actively securing new orders and expanding partnerships, including with CTS Mobility, Hyperion Partners, and USCellular.
• Siyata is relocating its manufacturing operations from China to the United States in 2025.
• The company has been issuing common shares and prefunded warrants under an equity line of credit with Hudson Global Ventures, LLC.

Sentiment

Score: 5

Explanation: The document presents a mixed picture. While revenue increased, profitability declined, and the company faces significant financial challenges. The merger with Core Gaming offers potential for future growth, but it also introduces new risks.

Positives

• Revenue increased by 41.3% in FY2024, indicating growth in sales.
• The company is expanding its product portfolio with new devices like the SD7+ and SD7-ULTRA.
• Siyata is relocating its manufacturing operations to the United States, which could improve supply chain resilience.
• The merger with Core Gaming provides an opportunity to diversify into the mobile gaming market.
• The company has secured new orders and expanded partnerships, indicating growing market acceptance of its products.

Negatives

• The company experienced a net loss of $25.27 million in FY2024, indicating ongoing financial challenges.
• Gross margin decreased to 18.4% in FY2024, suggesting pricing pressures or increased costs.
• The company has a history of operating losses and a going concern explanatory paragraph in its audit report.
• The company has identified material weaknesses in its internal controls over financial reporting.

Risks

• The company's ability to continue as a going concern is uncertain.
• The company relies on channel partners to generate a substantial majority of its revenues.
• The company participates in a competitive industry, which may become more competitive.
• The consummation of the Merger is subject to the closing conditions contained in the Merger Agreement and the Merger could be delayed or may never occur.
• The company is subject to a wide range of product regulatory and safety, consumer, worker safety and environmental laws and regulations.

Future Outlook

Siyata expects to leverage expanded partnerships and product offerings to drive growth in North America and international markets. The company anticipates completing the merger with Core Gaming in Q2 2025.

Industry Context

The document highlights Siyata's participation in the Push-to-Talk over Cellular (PoC) market, which is experiencing growth as a replacement for traditional Land Mobile Radio (LMR) systems. The company is positioning itself to capitalize on this trend with its rugged handsets and in-vehicle solutions. The merger with Core Gaming represents a strategic move to diversify into the mobile gaming market.

Comparison to Industry Standards

• Siyata competes with companies like Sonim Technologies, Kyocera, and Samsung in the rugged mobile device market.
• In the Cellular Booster category, Siyata has several direct competitors, including Wilson Electronics, LLC, Nextivity, Inc. and SureCall Company.
• The company's reliance on channel partners is a common practice in the telecommunications industry, but it also presents risks related to partner performance and competition.
• The company's focus on the public safety market aligns with the growing demand for secure and reliable communication solutions for first responders.
• The company's expansion into the mobile gaming market through the merger with Core Gaming is a strategic move to diversify its revenue streams and capitalize on the growth of the gaming industry.

Legal Proceedings

• The Company was served with a lawsuit from one of its suppliers demanding an amount of $457,477.91 for services rendered to the Company. The Company is of the opinion that they are not liable for any amounts due however the Company has accrued these amounts in these financial statements.

Stakeholder Impact

• Shareholders will experience dilution as a result of the merger with Core Gaming and the issuance of new shares.
• Employees may be affected by the relocation of manufacturing operations to the United States.
• Customers may benefit from the expanded product portfolio and improved communication solutions.
• Suppliers may be affected by the relocation of manufacturing operations to the United States.

Next Steps

• Complete the merger with Core Gaming, Inc.
• Relocate manufacturing operations from China to the United States.
• Continue to expand partnerships and secure new orders.
• Focus on improving profitability and managing expenses.

Key Dates

Keywords

Siyata Mobile, Core Gaming, Merger, Financial Results, Rugged Devices, Push-To-Talk, Mobile Gaming, Revenue, Net Loss, Partnerships