Cannabis Vaping Sales Propel Q2 Revenue For Marijuana Co. Doing Business With Burna Boy, Berner - HEMPACC

Ispire Technology Inc. (NASDAQ:ISPR) reported financial results on Tuesday for the second quarter of fiscal 2024, three months ended Dec. 31, 2023.

The Los Angeles-based company reported a 30.7% year-over-year increase in revenue to $41.7 million in the second quarter. Cannabis vaping products contributed $19.5 million to revenue the total revenue, representing a 149% year-over-year increase, while tobacco vaping products contributed $22.1 million.

"This significant growth in cannabis vaping hardware revenues is a testament to our commitment to innovation and the immense potential of our industry," Daniel Machock, the company's CFO said.

Ispire Technology went public last year, after closing its initial public offering of 2.7 million shares of common stock at the initial public offering price of $7.00 per share.

In April 2023, the company entered into a strategic partnership with cannabis brand Cookies founded by rap star Berner, a.k.a. Gilbert Milam. Under that deal, Cookies agreed to work with Ispire to help facilitate the purchase of an aggregate of 15 million units of mutually agreed Ispire products by Cookies’ third-party retail and wholesale partners.

In November, Aspire North America, one of Ispire's operating subsidiaries, entered a five-year exclusive manufacturing and global distribution agreement with Hempacco Co., Inc. (NASDAQ:HPCO), under which Aspire will distribute and commercialize Hempacco’s branded cannabinoid and nicotine vapor products, namely Snoop Dogg‘s Dogg Lbs.

In December, the company entered a five-year exclusive global manufacturing and distribution agreement with BrkFst, a lifestyle brand co-created by GRAMMY-Award winner Burna Boy a.k.a. Damini Ebunoluwa Ogulu and his inner circle of young entrepreneurs last year.

Q2 2024 Financial Highlights

Gross profit totaled $6.4 million, up from $5.1 million in the prior year's period.
Gross margin was 15.3% compared to 16.1% for the same period in fiscal 2023.
Total operating expenses climbed to $10.3 million, from $4.8 million in the corresponding quarter of fiscal 2023.
Net loss was $4 million, up from 130,242 in the second quarter of last year.
As of Dec. 31, 2023, the company had $90.6 million in total assets and roughly $58.5 million in total current liabilities.

“This quarter proved to be quite pivotal for not only our product expansions but also our business operations. We commenced several strategic initiatives, including ISO and GMP certification for our Malaysian facility and a path to receive Pre-market Tobacco Product Application approval in the U.S.," said Michael Wang, co-chief executive officer of Ispire. "After seeing such remarkable growth trends related to our cannabis vaping hardware sales, we aim to intensify our presence and further expand our footprint in this domestic market.”

2024 Outlook

Revenue for cannabis vaping products for fiscal year 2024 is projected to range between $80 million to $90 million, representing growth of 100% to 125% from fiscal year 2023.

Revenue for tobacco vaping products for fiscal year 2024 is projected to be in the range of $95 million to $105 million, representing growth in the range of 33% to 47% from fiscal year 2023.

ISPR Price Action

Ispire Technology's shares traded 13.94% lower at $10 per share during the pre-market session on Wednesday morning.

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HPCOHEMPACCO CO INC by Hempacco Co., Inc.

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ISPRIspire Technology Inc

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