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HUNTERSVILLE, NC – Akoustis Technologies, Inc. (NASDAQ:AKTS), a manufacturer of telephone and telegraph apparatus, is currently at risk of being delisted from the Nasdaq Capital Market due to non-compliance with the minimum stockholders’ equity requirement.
The company, which was previously known as Danlax, Corp., received a notice from Nasdaq on Thursday, October 10, 2024, indicating its stockholders' deficit of approximately $57.1 million, falling short of the required $2.5 million equity threshold.
The notice follows an earlier warning regarding the company's failure to meet the $1.00 Minimum Bid Price requirement. Akoustis Technologies' common stock had closed at $0.10 or less per share for a consecutive 10-day trading period ending August 16, 2024, prompting Nasdaq to consider delisting. The company appealed this decision and presented a compliance plan at a hearing before a Nasdaq Hearings Panel on Monday, October 8, 2024.
While the Panel's decision is pending, trading of Akoustis Technologies' common stock will continue on the Nasdaq Capital Market. The company has expressed that there is no certainty that the Panel will grant a compliance period, nor can it assure that it will be able to regain compliance with the listing requirements.
This development is a significant concern for Akoustis Technologies, as a delisting could adversely impact its ability to raise capital and affect its financial condition and business operations. The company's forward-looking statements acknowledge the risks and uncertainties associated with the Panel's upcoming decision and its ability to address the compliance deficiencies.
Investors are advised that the company's current situation could lead to substantial costs and diversion of resources. The information provided in this article is based on a press release statement from Akoustis Technologies, Inc. and the company's recent SEC filing.
In other recent news, Akoustis Technologies, Inc. has made several significant developments. The company has announced the appointment of Kamran Cheema as its new Chief Executive Officer and board member.
On the financial front, Akoustis reported a 7% increase in Q3 FY2024 revenues, totaling $7.5 million, and secured a series of orders for its high-band RF filters, including a $13 million order for XBAW® filters for Wi-Fi Access Points.
However, the company is also dealing with substantial legal challenges, having been found liable for trade secret misappropriation and patent infringement. Damages awarded to rival Qorvo (NASDAQ:QRVO) Inc. total approximately $38.6 million, with an additional $11.7 million in attorneys' fees. The final judgment is pending, and depending on the outcome, Akoustis may need to seek bankruptcy protection.
Akoustis is also facing the risk of being delisted from Nasdaq due to non-compliance with the minimum bid price requirement, but plans to appeal the decision. B.Riley has maintained a Neutral rating for Akoustis Technologies following the Q3 earnings report.
Lastly, as part of its strategic approach towards financial management, Akoustis launched a direct stock offering of 50 million shares, managed by Roth Capital Partners. These are the recent developments for Akoustis Technologies.
InvestingPro Insights
Recent InvestingPro data paints a challenging picture for Akoustis Technologies (NASDAQ:AKTS), aligning with the company's current delisting risk. The company's market capitalization has dwindled to just $11.78 million, reflecting investor concerns. AKTS's financial health appears precarious, with InvestingPro Tips highlighting that the company operates with a significant debt burden and may have trouble making interest payments.
The stock's performance has been notably poor, with a staggering 91.09% decline over the past year. This aligns with the article's mention of AKTS failing to meet Nasdaq's minimum bid price requirement. Despite a recent 21.72% uptick over the last month, possibly related to the company's appeal to Nasdaq, the longer-term trend remains severely negative.
InvestingPro Tips also indicate that AKTS is quickly burning through cash and suffers from weak gross profit margins, which corroborates the company's reported stockholders' deficit of $57.1 million. These factors contribute to analysts' expectations that the company will not be profitable this year.
For investors seeking a more comprehensive analysis, InvestingPro offers 17 additional tips for AKTS, providing deeper insights into the company's financial situation and market performance.
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