HOUSTON - Freight Technologies, Inc. (NASDAQ:FRGT), known as Fr8Tech, has reported a revenue increase of 6.6% in the first half of 2024, totaling approximately $8.1 million. The company, which specializes in logistics management innovation, attributes this growth to a robust freight market in the US, Mexico, and cross-border regions. Revenue from its Fr8Fleet business more than doubled, driven by an 82% surge in shipments.
The company also saw a 40% year-over-year rise in gross profits, reaching $1.0 million, with gross margin percentage improving by 280 basis points to 11.8%. As a result, Fr8Tech has updated its full-year revenue forecast for 2024, now expecting it to be between $15 million and $20 million.
According to CEO Javi Selgas, the company's growth is fueled by a dynamic freight market and an emphasis on high-quality, margin-enhancing customers. Fr8Tech's portfolio includes the Fr8App platform, Fr8Now, Fr8Fleet, and Waavely, all interconnected within a unified platform that leverages data and AI models to enhance supply chain efficiency.
The company has also announced the commercialization of its Transportation Management System (TMS) solution, which aims to serve as a comprehensive digital command center for logistics teams. The TMS is designed to enable real-time shipment tracking, carrier selection, route administration, driver communication, and integration with inventory and billing systems.
Fr8Tech's CFO, Don Quinby, highlighted the value delivered by Fr8Fleet and the company's ongoing commitment to process automation and refinement, which has been crucial in advancing the TMS solution.
Selgas emphasized the TMS offering's potential to revolutionize logistics with features like real-time carrier capacity data, AI pricing tools, premier tracking technology, and seamless API integration. He also noted the high gross margin for selling the TMS as a Software as a Service (SaaS) solution, which ranges between 50% and 80%.
The company's TMS development is informed by seven years of experience in the USMCA freight market, offering tailored solutions to meet the unique needs of cross-border and Mexico-based logistics.
This report is based on a press release statement from Fr8Tech.
In other recent news, Freight Technologies, also known as Fr8Tech, has made significant strides in its financial and operational developments. The company has successfully resolved outstanding financial obligations with Freight Opportunities LLC, extinguishing $906,000 in outstanding promissory notes, accumulated interest, and the remaining $220,000 of convertible notes. This move strengthens Fr8Tech's balance sheet and frees up cash for further investment.
On the operational front, Fr8Tech has expanded its partnership with Amazon (NASDAQ:AMZN) Mexico to include U.S.-Mexico cross-border shipping operations through its Fr8App platform. This is an extension of Fr8Tech's role during Amazon's high-demand season in Mexico, a collaboration that began in December 2023. Additionally, Fr8Tech has been selected by Solave, a significant player in the Blue Agave market, to manage its cross-border logistics, aiming to increase supply chain efficiency.
In terms of financial performance, Fr8Tech reported steady growth in its Q4 2023 revenue, with a revenue of approximately $5 million for the quarter. This marks a 7.5% increase from the previous quarter and a 16% rise from the same period in 2022. Despite facing potential Nasdaq delisting, these recent developments underline Fr8Tech's ongoing efforts to navigate compliance challenges, foster strategic partnerships, and maintain a positive financial trajectory.
InvestingPro Insights
In light of Freight Technologies, Inc.'s (NASDAQ:FRGT) reported revenue increase and optimistic outlook for the year, InvestingPro data provides a more nuanced view of the company's financial health. Despite a positive surge in shipments and gross profits in the first half of 2024, Fr8Tech's overall financial metrics indicate some challenges. The company's market capitalization stands at a modest $28.78 million, reflecting the scale of its operations within the logistics sector. Additionally, a negative P/E ratio of -3.09 for the last twelve months as of Q4 2023 suggests that investors are concerned about the company's profitability.
Moreover, the gross profit margin for the same period was reported at -27.04%, underscoring the company's struggle to translate revenues into gross profit. This aligns with one of the InvestingPro Tips that points out Fr8Tech's weak gross profit margins. Another significant concern highlighted by InvestingPro Tips is that analysts do not expect the company to be profitable this year, which could weigh on investor sentiment.
InvestingPro Tips also reveal that Fr8Tech's stock price has been quite volatile and is currently trading near its 52-week low, which may present a cautionary signal to potential investors. The company's stock price has experienced a sharp decline over the past year, with a 95.71% drop in price total return. This volatility is an important consideration for those looking at the long-term investment potential of Fr8Tech.
For readers interested in a deeper analysis of Freight Technologies, Inc., there are additional InvestingPro Tips available, providing further insights into the company's financials and stock performance. These tips can be found at https://www.investing.com/pro/FRGT, offering valuable information for making informed investment decisions.
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