Xiao-I Corporation Announces Strong 2024 Results: Revenue Up 19% with Path to Profitability in 2025

PR Newswire

SHANGHAI, May 15, 2025

Profitability Roadmap: Efficiency and Discipline

SHANGHAI, May 15, 2025 /PRNewswire/ -- Xiao-I Corporation ("Xiao-I" or the "Company") $(AIXI)$, a global leader in artificial intelligence solutions, today announced selected audited financial results for the year 2024, highlighting approximately $70.31 million in revenue, representing a 18.8% year-over-year growth, a gross profit margin $(GPM)$ improvement of 2 percentage points, and a significant narrowing of net loss to $14.55 million. These results position the Company to achieve profitability in 2025.

Key Financial Highlights

- Revenue Growth: revenue for 2024 reached approximately $70.31 million, up 18.8% year-over-year, driven by surging demand for its Hua Zang LLM - powered Model-as-a-Service (MaaS) solutions and breakthrough AI hardware sales.

- Gross Profit: Gross profit increased from $39,423,570 in 2023 to $48,049,547 in 2024, representing a growth rate of approximately 21.9%.

- Margin Expansion: Gross profit margin improved to 68.3%, compared to 66.6% in 2023, reflecting operational leverage from MaaS commercialization and cost-optimized deployment.

- R&D Expenses: Research and development expenses totaled $34.66 million, down from $52.39 million in 2023. The 33.8% reduction reflects improved efficiency and the productization of core technologies.

- Net Loss Reduction: Net loss narrowed significantly to $14.55 million in 2024, down 46.1% from $27.01 million in 2023, underscoring disciplined cost management and revenue scalability.

Material Unfinished Matters

During the fiscal year 2024, Xiao-I Corporation pursued legal proceedings against Apple Inc. regarding alleged patent infringement. Key developments in the case include:

   -- July 31, 2024: The trial phase of the lawsuit concluded. 
 
   -- September 24, 2024: The Shanghai High People's Court held a hearing 
      session, attended by legal representatives from both parties. 
 
   -- November 1, 2024: The Shanghai High People's Court held a second hearing 
      session. 

As of the date of this release, all legal processes have been completed, with all parties awaiting the court's final ruling.

Management Comment

"2024 marks our evolution into a mature AI-driven growth company, powered by the Hua Zang LLM foundation. Going forward, while advancing profitability through hardware innovations like AI Glasses and tAIkbox, we confront material risks requiring vigilant management. Geopolitical fragmentation--particularly US-China technology decoupling--impacts hardware procurement cycles and cross-border service deployments. Also, multi-tier supply chain resilience remains critical for AI hardware scaling, with regional conflicts posing potential component shortages. With 90% domestic operational anchoring, MaaS model's tariff-agnostic nature provides partial insulation, while AI-driven G&A optimization below 15% of revenue enhances risk absorption capacity. Management remains committed to disciplined execution across these vectors to achieve 2025 profitability targets."

About Xiao-I Corporation

Xiao-I Corporation is a leading cognitive intelligence enterprise in China that offers a diverse range of business solutions and services in artificial intelligence, covering natural language processing, voice and image recognition, machine learning, and affective computing. Since its inception in 2001, the Company has developed an extensive portfolio of cognitive intelligence technologies that are highly suitable and have been applied to a wide variety of business cases. Xiao-I powers its cognitive intelligence products and services with its cutting-edge, proprietary AI technologies to enable and promote industrial digitization, intelligent upgrading, and transformation. For more information, please visit: www.xiaoi.com.

Forward-Looking Statements

This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. When the Company uses words such as "may," "will," "intend," "should," "believe," "expect," "anticipate," "project," "estimate" or similar expressions that do not relate solely to historical matters, it is making forward-looking statements. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that may cause the actual results to differ materially from the Company's expectations discussed in the forward-looking statements. These statements are subject to uncertainties and risks including, but not limited to, the following: the Company's ability to achieve its goals and strategies, the Company's future business development and plans for future business development, including its financial conditions and results of operations, product and service demand and acceptance, reputation and brand, the impact of competition and pricing, changes in technology, government regulations, fluctuations in general economic and business conditions in China, and assumptions underlying or related to any of the foregoing and other risks contained in reports filed by the Company with the U.S. Securities and Exchange Commission ("SEC"). For these reasons, among others, investors are cautioned not to place undue reliance upon any forward-looking statements in this press release. Additional factors are discussed in the Company's filings with the SEC, including under the section entitled "Risk Factors" in its annual report on Form 20-F filed with the SEC on May 15, 2025, as well as its current reports on Form 6-K and other filings, all of which are available for review at www.sec.gov. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.

For investor and media inquiries, please contact:

Ms. Berry Xia

Email: ir@xiaoi.com

 
XIAO-I CORPORATION CONSOLIDATED BALANCE SHEETS (In U.S. dollars, 
except for share and per share data, or otherwise noted) 
 
                                          As of December 31, 
                                    ------------------------------ 
                                         2023            2024 
                                    --------------  -------------- 
Assets 
Current assets: 
Cash and cash equivalents           $    1,564,542  $      846,593 
 Restricted cash                            20,676               - 
 Accounts receivable, net               28,326,985      55,543,017 
 Amounts due from related parties, 
  current                                        -      13,587,536 
 Inventories                                67,826          14,362 
 Contract costs                          1,691,293       2,502,678 
 Advance to suppliers                    1,149,642       3,205,098 
 Prepaid expenses and other 
  current assets, net                    5,233,553         792,732 
                                     -------------   ------------- 
Total current assets                    38,054,517      76,492,016 
                                     -------------   ------------- 
 
Non-current assets: 
 Property and equipment, net             2,125,629       1,867,736 
 Intangible assets, net                    212,445         143,370 
 Long-term investments                   2,650,458       2,497,594 
 Right of use assets                     2,431,475         833,030 
 Prepaid expenses and other 
  non-current assets                     7,000,357       3,677,728 
 Amount due from related parties, 
  non-current                           13,859,350               - 
                                     -------------   ------------- 
Total non-current assets                28,279,714       9,019,458 
                                     -------------   ------------- 
 
TOTAL ASSETS                        $   66,334,231  $   85,511,474 
                                     =============   ============= 
 
Liabilities 
Current liabilities: 
 Short-term borrowings              $   26,760,940  $   32,879,865 
 Accounts payable                       13,674,339      27,131,439 
 Amount due to related parties, 
  current                                  704,947         217,068 
 Deferred revenue                        1,654,145       2,385,228 
 Convertible loans                               -         216,756 
 Accrued expenses and other 
  current liabilities                   13,938,253      23,289,453 
 Lease liabilities, current                929,755         483,658 
                                     -------------   ------------- 
Total current liabilities               57,662,379      86,603,467 
                                     -------------   ------------- 
 
Non-current liabilities: 
 Amount due to related parties, 
  non-current                            7,905,290       7,336,833 
 Accrued liabilities, non-current        7,759,474       7,043,185 
 Lease liabilities, non-current          1,473,950         295,962 
                                     -------------   ------------- 
Total non-current liabilities           17,138,714      14,675,980 
                                     -------------   ------------- 
TOTAL LIABILITIES                       74,801,093     101,279,447 
                                     =============   ============= 
 
Commitments and Contingencies                    -               - 
Shareholders' deficit Ordinary 
 shares (par value of $0.00005 per 
 share; 1,000,000,000 shares   and 
 1,000,000,000 shares authorized 
 as of December 31, 2023 and 
   2024, respectively; 24,015,592 
 shares and 31,949,038 shares 
 issued   and outstanding as of 
 December 31, 2023 and 2024, 

 respectively)                      $        1,201  $        1,598 
Preferred shares (par value of 
 $0.00005 per share; 3,700,000 
 preferred    shares authorized as 
 of December 31, 2023 and 2024, 
 respectively;   3,700,000 
 preferred shares issued and 
 outstanding as of December   31, 
 2023 and 2024, respectively)                  185             185 
 Additional paid-in capital            108,729,047     115,745,140 
 Statutory reserve                         237,486         237,486 
 Accumulated deficit                 (110,833,045)   (125,338,509) 
 Accumulated other comprehensive 
  loss                                 (2,998,562)     (2,848,314) 
                                     -------------   ------------- 
 XIAO-I CORPORATION shareholders' 
  deficit                              (4,863,688)    (12,202,414) 
 Non-controlling interests             (3,603,174)     (3,565,559) 
                                     -------------   ------------- 
Total shareholders' deficit            (8,466,862)    (15,767,973) 
                                     -------------   ------------- 
TOTAL LIABILITIES AND 
 SHAREHOLDERS' DEFICIT              $   66,334,231  $   85,511,474 
                                     =============   ============= 
 
 
XIAO-I CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS AND 
COMPREHENSIVE LOSS (In U.S. dollars, except for share and per share 
data, or otherwise noted) 
 
                           For the years ended December 31, 
                      ------------------------------------------- 
                          2022           2023           2024 
                      -------------  -------------  ------------- 
Sale of software 
 products             $   3,547,113  $   1,566,455  $   1,516,169 
Sale of hardware 
 products                    46,295         75,363      1,395,345 
Technology 
 development 
 service                 16,419,889      7,839,700     24,105,644 
M&S service               2,429,526      2,676,185      2,419,901 
Sale of cloud 
 platform products       25,742,135     47,007,556     40,877,256 
                       ------------   ------------   ------------ 
Net revenues             48,184,958     59,165,259     70,314,315 
Cost of sale of 
 software products        (888,220)      (834,570)       (98,442) 
Cost of sale of 
 hardware products         (25,141)       (51,201)      (583,939) 
Cost of technology 
 development 
 service               (12,194,044)    (6,059,330)   (10,444,827) 
Cost of M&S service     (1,255,973)      (971,417)      (781,258) 
Cost of sale of 
 cloud platform 
 products               (3,015,766)   (11,825,171)   (10,356,302) 
                       ------------   ------------   ------------ 
Cost of revenues       (17,379,144)   (19,741,689)   (22,264,768) 
                       ------------   ------------   ------------ 
Gross profit             30,805,814     39,423,570     48,049,547 
                       ------------   ------------   ------------ 
 
Operating expenses: 
 Selling expenses       (3,911,818)    (4,550,997)    (3,320,886) 
 General and 
  administrative 
  expenses              (6,028,637)    (4,407,215)   (22,940,916) 
 Research and 
  development 
  expenses             (24,001,138)   (52,387,540)   (34,658,779) 
                       ------------   ------------   ------------ 
Total operating 
 expenses              (33,941,593)   (61,345,752)   (60,920,581) 
                       ------------   ------------   ------------ 
 
Loss from operations    (3,135,779)   (21,922,182)   (12,871,034) 
                       ------------   ------------   ------------ 
 
Other 
income/(expenses): 
 Investment 
  (loss)/income           (143,181)         75,542       (81,618) 
 Interest expenses, 
  net                   (2,440,815)    (2,323,341)    (2,319,820) 
 Foreign currency 
  exchange 
  (loss)/gain              (68,902)          2,789          3,864 
 Other income, net          444,018        949,116        717,280 
                       ------------   ------------   ------------ 
Total other expenses    (2,208,880)    (1,295,894)    (1,680,294) 
                       ------------   ------------   ------------ 
 
Loss before income 
 tax expense            (5,344,659)   (23,218,076)   (14,551,328) 
 Income tax expense       (660,655)    (3,787,692)              - 
                       ------------   ------------   ------------ 
Net loss              $ (6,005,314)  $(27,005,768)  $(14,551,328) 
                       ------------   ------------   ------------ 
 Net loss 
  attributable to 
  non-controlling 
  interests               (106,779)      (543,961)       (45,864) 
                       ------------   ------------   ------------ 
 Net loss 
  attributable to 
  XIAO-I CORPORATION 
  shareholders          (5,898,535)   (26,461,807)   (14,505,464) 
Other comprehensive 
income 
 Foreign currency 
  translation 
  change, net of nil 
  income taxes              403,816        303,114        233,727 
                       ------------   ------------   ------------ 
 Total other 
  comprehensive 
  income                    403,816        303,114        233,727 
                       ------------   ------------   ------------ 
Total comprehensive 
 loss                 $ (5,601,498)  $(26,702,654)  $(14,317,601) 
                       ============   ============   ============ 
Total comprehensive 
 income/(loss) 
 attributable to 
 non-   controlling 
 interests                   95,280      (504,951)         37,615 
Total comprehensive 
 loss attributable 
 to XIAO-I 
   CORPORATION 
 shareholders           (5,696,778)   (26,197,703)   (14,355,216) 
Loss per ordinary 
share attributable 
to XIAO-I 
  CORPORATION 
shareholders 
  Basic                      (0.27)         (1.12)         (0.56) 
  Diluted                    (0.27)         (1.12)         (0.56) 
Weighted average 
number of ordinary 
shares outstanding 
 Basic                   22,115,592     23,646,003     25,760,207 
 Diluted                 22,115,592     23,646,003     25,760,207 
 

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