What changed in MOVING iMAGE TECHNOLOGIES INC.'s 2023 10-K compared to 2022?

Across the narrative sections we track, MOVING iMAGE TECHNOLOGIES INC. (MITQ) added 140 paragraphs, removed 142, and edited 115 between the 2022 and 2023 10-K filings. The biggest movers are Item 7. Management's Discussion & Analysis (+53/−53), Item 1A. Risk Factors (+45/−48), Item 1. Business (+35/−37).

Did MOVING iMAGE TECHNOLOGIES INC. add new Risk Factors in the 2023 10-K?

Yes — Item 1A Risk Factors shows 45 new/edited paragraphs and 48 removed paragraphs versus the 2022 10-K.

What changed in MOVING iMAGE TECHNOLOGIES INC.'s MD&A (Item 7) in 2023?

Item 7 Management's Discussion & Analysis shows 53 new/edited paragraphs and 53 removed paragraphs year-over-year. Read the side-by-side diff to see exactly which revenue, margin, and outlook commentary was rewritten.

Where does this MITQ 10-K diff come from?

The source filings are MOVING iMAGE TECHNOLOGIES INC.'s official 2022 and 2023 Form 10-K annual reports from SEC EDGAR. 10q10k.net parses each filing, aligns paragraphs by section (Item 1, 1A, 1C, 2, 3, 7, 7A), and highlights every added, removed and edited sentence side-by-side.

MOVING iMAGE TECHNOLOGIES INC.MITQEarnings & Financial Report

NYSE · Information Technology · Photographic Equipment & Supplies

Deep Analysis

Silicon Image Inc. was an American fabless semiconductor company based in Hillsboro, Oregon, and active from 1995 to 2015. The company designed circuits for mobile phones, consumer electronics and personal computers (PCs). It also manufactured wireless and wired connectivity products used for high-definition content. The company's semiconductor and IP products were deployed by manufacturers in devices such as smartphones, tablets, digital televisions (DTVs), and other consumer electronics, as...

What changed in MOVING iMAGE TECHNOLOGIES INC.'s 10-K — 2022 vs 2023

Top changes in MOVING iMAGE TECHNOLOGIES INC.'s 2023 10-K

140 paragraphs added · 142 removed · 115 edited across 5 sections

Item 7. Management's Discussion & Analysis+53 / −53 · 39 edited
Item 1A. Risk Factors+45 / −48 · 41 edited
Item 1. Business+35 / −37 · 31 edited
Item 5. Market for Registrant's Common Equity+6 / −3 · 3 edited
Item 2. Properties+1 / −1 · 1 edited

Item 1. Business

Business — how the company describes what it does

31 edited+4 added−6 removed47 unchanged

2022 filing

2023 filing

We believe that our quality control procedures and the quality standards for the products that we distribute or service have contributed significantly to our reputation for high performance and reliability.

We believe that our quality control procedures and the quality standards for the products we distribute or service have contributed significantly to our reputation for high performance and reliability.

While LED displays have been around for years (e.g., the giant displays in virtually every sports arena), the constant miniaturization of the technology has now made cinema exhibition possible.

While LED displays have been around for years (e.g., the giant displays in virtually every sports arena), the constant miniaturization of this technology has now made cinema exhibition possible.

All open orders at June 30, 2021, except one for approximately $0.2 million due to customer deferral, were fulfilled in year ended June 30, 2022. Sales backlog typically represents the fixed contracted revenue under signed theater system installation or upgrade agreements that we believe will be recognized as revenue upon installation/upgrade and acceptance of the associated theater.

All open orders at June 30, 2022, except one for approximately $0.2 million due to customer deferral, were fulfilled in year ended June 30, 2023. Sales backlog typically represents the fixed contracted revenue under signed theater system installation or upgrade agreements that we believe will be recognized as revenue upon installation/upgrade and acceptance of the associated theater.

We will continue to evaluate our targeted acquisition strategy based on several factors, including profitability, enhancement of the overall customer experience, pricing models, throughput, types of content featured and differences in geographic areas. Sales and Marketing We market and sell directly to theater exhibitors, as well as through certain domestic and international value-added resellers.

We will continue to evaluate our targeted acquisition strategy based on several factors, including profitability, enhancement of the overall customer experience, pricing models, throughput, types of content featured and differences in geographic areas. Sales and Marketing We market and sell directly to theater exhibitors, and through certain domestic and international value-added resellers.

Fabrication of a majority of other parts and sub-assemblies is subcontracted to a group of third-party suppliers. We believe our significant suppliers will continue to supply quality products in quantities sufficient to satisfy our needs. We inspect all parts and sub-assemblies, complete the final assembly and then subject the system to comprehensive testing individually prior to shipment.

Fabrication of most other parts and sub-assemblies is subcontracted to a group of third-party suppliers. We believe our significant suppliers will continue to supply quality products in quantities sufficient to satisfy our needs. We inspect all parts and sub-assemblies, complete the final assembly and then subject the system to comprehensive testing individually prior to shipment.

Our telephone number is (714) 751-7998. 2 Table of Contents Description of Business We are a leading provider of technology, products, and services to movie theater operators and sports and entertainment venues. 1) We provide a set of valuable services to movie theater operators and other critical screening and viewing rooms.

Our telephone number is (714) 751-7998. 2 Table of Contents Description of Business We are a key provider of technology, products, and services to movie theater operators and sports and entertainment venues. 1) We provide a set of valuable services to movie theater operators and other critical screening and viewing rooms.

These mission critical components tie projectors, media servers, lighting and sound systems together to ensure a robust cinematic experience. Audio Systems — MiT has distribution and Master Reseller agreements for the Americas with world class manufacturers of signal processing, amplification and loudspeakers by Dolby, QSC, Samsung (Harman, JBL, Crown), Trinnov, LEA Professional, Krixx and Meyer Sound.

These mission critical components tie projectors, media servers, lighting and sound systems together to ensure a robust cinematic experience. 4 Table of Contents Audio Systems — MiT has distribution and Master Reseller agreements for the Americas with world class manufacturers of signal processing, amplification and loudspeakers by Dolby, QSC, Samsung (Harman, JBL, Crown), Trinnov, LEA Professional, Krixx and Meyer Sound.

Also, the LED is ideal for displaying High Dynamic Range (HDR) which we believe at present is the main video aesthetic enhancement being used to boost audience experience in cinemas. Since the LED consumes no power when they are switched off to ‘illuminate’ black, this saves on electricity versus the always-on energy of laser projection or xenon lamps.

Also, LED is ideal for displaying High Dynamic Range (HDR) which we believe is the main video aesthetic enhancement used to boost audience experience in cinemas. Since the LED consumes no power when they are switched off to ‘illuminate’ black, this saves on electricity versus the always-on energy of laser projection or xenon lamps.

Manufacturing and Assembly MiT has 28,000 square feet of office, warehouse and in-house manufacturing/assembly space in Southern California, which is home to our corporate offices, engineering, distribution, integration as well as service and support divisions. Our primary location is augmented by a global network of service partners and OEM manufacturers.

Manufacturing and Assembly MiT has 28,000 square feet of office, warehouse and in-house manufacturing/assembly space in Southern California, which is home to our corporate offices, engineering, distribution, integration as well as service and support divisions. A global network of service partners and OEM manufacturers augments our primary location.

According to the Motion Picture Association of America, international markets continue to be an increasingly important component of the overall box office revenues generated by Hollywood films, accounting for approximately 73% of 2019 total worldwide box office revenues. Introduction of New Platforms and Product Offerings that Enhance the Movie-Going Experience .

According to the Motion Picture Association of America, international markets continue to be an increasingly important component of the overall box office revenues generated by Hollywood films, accounting for approximately 71% of 2022 total worldwide box office revenues. Introduction of New Platforms and Product Offerings that Enhance the Movie-Going Experience .

There can be no assurance that in all instances a substitute for a prohibited raw material or process would be available, or be available at reasonable cost. Employees We employed 31 full-time personnel as of June 30, 2022. We are not a party to any collective bargaining agreement.

There can be no assurance that in all instances a substitute for a prohibited raw material or process would be available, or be available at reasonable cost. Employees We employed 32 full-time personnel as of June 30, 2023. We are not a party to any collective bargaining agreement.

We estimate that approximately 3,100 Series 1 projectors will need replacement over the next four years as obsolescence sets in and upgrades become the new normal to stay competitive. Laser projectors. These projectors are a significant upgrade over existing lamp-based digital projectors, offering a wider color gamut, which provides substantially more vivid colors, plus substantially brighter images.

We estimate that approximately 1,500 Series 1 projectors will need replacement over the next three years as obsolescence sets in and upgrades become the new normal to stay competitive. Laser projectors. These projectors are a significant upgrade over existing lamp-based digital projectors, offering a wider color gamut, which provides substantially more vivid colors, plus substantially brighter images.

Our sales and marketing professionals have extensive experience with our product and service offerings and have long-term relationships throughout the industry. 6 Table of Contents Our top ten customers accounted for approximately 48% and 55% of net revenues for the years ended June 30, 2022 and 2021, respectively.

Our sales and marketing professionals have extensive experience with our product and service offerings and have long-term relationships throughout the industry. 6 Table of Contents Our top ten customers accounted for approximately 37% and 48% of net revenues for the years ended June 30, 2023 and 2022, respectively.

Many locations now offer a full dining and entertainment experience that includes appetizers, entrees, desserts, alcohol beverages and/or healthier snack options for guests. 3 Table of Contents In addition, luxury seats are offered in many locations, further enhancing the movie viewing experience.

Many locations now offer a full dining and entertainment experience that includes appetizers, entrees, desserts, alcohol beverages and/or healthier snack options for guests. In addition, luxury seats are offered in many locations, further enhancing the movie viewing experience.

Movie-going continues to be one of the most affordable forms of out-of-home entertainment, with an estimated average ticket price in the U.S. of $9.57 in 2021. Movie theaters continue to draw more people than all theme parks and major U.S. sports combined according to the Motion Picture Association of America. Increased Importance and Growth of International Markets .

Movie-going continues to be one of the most affordable forms of out-of-home entertainment, with an estimated average ticket price in the U.S. of $10.53 in 2022. Movie theaters continue to draw more people than all theme parks and major U.S. sports combined according to the Motion Picture Association of America. Increased Importance and Growth of International Markets .

Projection replacements and upgrades. According to the Motion Picture Association of America, at the end of 2019 there were 41,172 screens in the United States and more than 168,000 elsewhere around the globe, and 96% of the world’s cinema screens are digitized; the conversion to digital cinema began in 2006.

Projection replacements and upgrades. According to the Motion Picture Association of America, at the end of 2021 there were 40,000 screens in the United States and more than 176,000 elsewhere around the globe, and 96% of the world’s cinema screens are digitized; the conversion to digital cinema began in 2006.

We believe our success will not be dependent upon trademark protection, but rather upon our engineering capabilities and research and production techniques. Backlog Our sales backlog at June 30, 2022 was approximately $10.03 million, which represented orders currently planned to be shipped substantially by December 31, 2022. Backlog at June 30, 2021 was $9.44 million.

We believe our success will not be dependent upon trademark protection, but rather upon our engineering capabilities and research and production techniques. Backlog Our sales backlog at June 30, 2023 was approximately $12.02 million, which represented orders currently planned to be shipped substantially by January 31, 2024. Backlog at June 30, 2022 was $10.03 million.

Their markets include cinema, sports, grocery, performing arts, worship and retail industries. Products include patented cup holders and trays built into luxury cinema seats, cinema step and aisle lighting, and cups, trays, and advertising displays used in large sports arenas. Caddy products are protected by 21 active and 6 pending patents.

Products include patented cup holders and trays built into luxury cinema seats, cinema step and aisle lighting, cups, trays, and advertising displays used in large sports arenas. Caddy products are protected by 21 active and 6 pending patents.

Trade accounts receivable from these customers represented approximately 48% and 18% of net receivables at June 30, 2022 and 2021, respectively. No customer accounted for more than 10% of the Company’s revenue for the year ended June 30, 2022. One customer accounted for 23% of the Company’s revenue for the year ended June 30, 2021.

Trade accounts receivable from these customers represented approximately 19% and 48% of net receivables at June 30, 2023 and 2022, respectively. No customer accounted for more than 10% of the Company’s revenue for the years ended June 30, 2023 and 2022.

If the agreement is terminated, once MiT and the customer are released from all their future obligations under the agreement, all or a portion of the initial fees that the customer previously made to us are recognized as revenue.

New technologies like motion seats, immersive sound and virtual reality are also offered for in-theater enjoyment at some locations. New Theater Construction . According to the National Association of Theatre Owners, the number of U.S. movie screens remained relatively consistent at 41,172 in 2019 and 40,998 in 2020.

New technologies like motion seats, immersive sound and virtual reality are also offered for in-theater enjoyment at some locations. 3 Table of Contents New Theater Construction . According to the National Association of Theatre Owners, the number of U.S. movie screens remained relatively consistent at 40,150 in 2021 and 39,007 in 2022.

We provide a complete range of DCI compliant cinema projectors and media servers to accommodate any screen size or application. The afore-mentioned brands are the largest manufacturers of high-end DCI compliant digital cinema projectors and media servers in the world. All manufacturers provide MiT with an accommodation to resell and distribute in defined projects in other areas of the world.

Examples of these products include our ADA-compliant accessibility products and our Caddy brand, a leading provider of proprietary cup holders, trays, and other products sold into our strategic markets of motion picture exhibition, entertainment, and sports venues as well as other non-strategic markets.

Examples of these products include our ADA-compliant accessibility products and other products sold into our strategic markets of motion picture exhibition, entertainment, and sports venues as well as other non-strategic markets.

MiT personnel have designed, specified and 5 Table of Contents installed thousands of commercial cinemas, post production, screening and high-end residential rooms and have been involved in the digital cinema conversion rollouts of clients such as AMC, Cinemark, Cinepolis, Cinemex, Reading, Metropolitan, Hollywood, Regal, Syufy, Harkins, and other smaller circuits.

MiT personnel have designed, specified and installed thousands of commercial cinemas, post production, screening and high-end residential rooms and have been involved in the digital cinema conversion rollouts of clients such as AMC, Cinemark, Cinepolis, Cinemex, Reading, Metropolitan, Hollywood, Regal, Syufy, Harkins, and other smaller circuits. 5 Table of Contents New Business Initiatives We continue to explore new lines of business complementary with our core business, focusing on entertainment technologies and related products and services.

Live viewing of sports has recovered to pre-pandemic levels with stadiums and arenas selling out regularly. However, new builds, upgrades, and refurbishments of new stadiums and arenas have not recovered as quickly as the movie theater industry. In addition, an influx of government grant funds is being utilized by cinemas resulting in additional MiT sales.

LED panels will last up to 100,000 hours or 15 years, whereas projectors have a lifespan of barely half that. Strategic acquisitions of complementary products and technologies. Our first acquisition was the acquisition of Caddy Products LLC (“Caddy”) which closed effective January 1, 2019. Caddy products are utilized in over 270,000 facilities throughout more than 91 countries worldwide.

LED panels can also last up to 100,000 hours or 15 years, whereas projectors have a lifespan of barely half that. Strategic acquisitions of complementary products and technologies. Our first acquisition was the acquisition of Caddy Products LLC (“Caddy”) which closed effective January 1, 2019. Their markets include cinema, sports, grocery, performing arts, worship and retail industries.

Additionally, MiT utilizing our inhouse design fabrication and manufacturing has designed and installed custom DirectView LED Screen frames for two of those installations. We believe that direct view LED is disruptive to the current front projection paradigm and offers several benefits to exhibitors and filmmakers which we believe will drive demand for these systems.

We believe that Direct View LED is disruptive to the current front projection paradigm and offers several benefits to exhibitors and filmmakers which we believe will drive demand for these systems in the years to come.

All manufacturers provide MiT with an accommodation to resell and distribute in defined projects in other areas of the world. 4 Table of Contents MiT in-house designed, manufactured and assembled sub-systems – MiT designs and manufactures automation, pedestal, projection pod (for booth less operations), and power management systems.

MiT in-house designed, manufactured and assembled sub-systems – MiT designs and manufactures automation, pedestal, projection pod (for booth less operations), and power management systems.

This return to a more normalized environment led to a broader and more diverse slate of movie releases, more tentpoles (blockbusters) from a wider range of distributors, and movie studios cutting back on or abandoning the direct-to-streaming model. The domestic box office was $4.4 billion with significant momentum going into 2022.

Industry and Revenue Drivers Our Industry Trends In 2021, the return to a more normalized theater environment led to a broader and more diverse slate of movie releases compared to prior year’s lower pandemic-related movie releases, more tent poles (blockbusters) from a wider range of distributors, and movie studios cutting back on or abandoning the direct-to-streaming model.

Sign language will also be supported through the same system. Direct View LED screens . MiT is the only company that has installed and commissioned the three leading DCI Directview LED cinema systems (“Samsung ONYX Cinema”, “LG DVLED Cinema” & “SONY Crystal LED”).

MiT is the only company that has installed and commissioned the three leading DCI Directview LED cinema systems (“Samsung ONYX Cinema”, “LG DVLED Cinema” & “SONY Crystal LED”). Additionally, MiT utilizing our in-house design fabrication and manufacturing has designed and installed custom DirectView LED Screen frames for two of those installations.

This unique system uses AR (Augmented Reality) glasses to allow any language captioning to be displayed on the glasses, permitting non-native English -speaking patrons the ability to fully enjoy the cinematic experience. This system also allows cinemas to reach out to what we believe is an underserved audience base in their communities.

This system also allows cinemas to reach out to what we believe is an underserved audience base in their communities. Sign language will also be supported through the same system. Direct View LED screens .

Removed

Industry and Revenue Drivers Our Industry Trends In 2019, the movie industry reported the second highest domestic box office ever at $11.4 billion. In 2020, the domestic box office declined to $2.3 billion due to pandemic-related shutdowns, while 2021 was a tale of two halves.

Added

The domestic box office for 2021 finished at $4.5 billion with significant momentum going into 2022. With studios re-focusing on exclusive theatrical releases, 2022 continued to see the domestic box office recover, reporting $7.4 billion in sales. Convenient and Affordable Form of Out-Of-Home Entertainment .

Removed

The first half maintained the slow level of domestic box office sales, with movie studios unsuccessfully experimenting with direct-to-streaming movies through their proprietary streaming services. In contrast, the second half began to see a recovery in the market with the easing of pandemic-related restrictions.

Added

MiTranslator — beginning in 2016, the Americans with Disabilities Act (ADA) required theaters to have provisions for seeing- and hearing-impaired patrons. In 2022, we acquired the ADA compliance product line from USL, giving MiT ownership of the leading product for theater ADA compliance.

Removed

Through July 31, 2022, the domestic box office has continued to expand, estimating $7.0 billion with several tentpoles due to be released during the second half of the year. Convenient and Affordable Form of Out-Of-Home Entertainment .

Added

However, in partnership with Hana Media and Epson America, we recently productized and began marketing a new system targeting a much larger audience that is not proficient in English.

Removed

New Business Initiatives We continue to explore new lines of business complimentary with our core business, with a focus on entertainment technologies and complimentary products and services. Multi-language ADA — The Americans with Disabilities Act (ADA) requires theaters to have provisions for seeing- and hearing-impaired patrons.

Added

The MiTranslator, which combines full ADA compliance with a multi-language capability, is a unique offering accessible through a mobile application on a user’s mobile device or through AR (Augmented Reality) glasses to allow any language captioning to be displayed on the glasses, permitting non-native English-speaking patrons the ability to enjoy the cinematic experience more fully.

Removed

Even before the 2016 requirement date, these devices have been available; however, in partnership with Hana Media and Epson America, we have recently productized and begun marketing a new system which combines full ADA compliance with a multi-language capability.

Removed

Specifically, as a result of the effects of the COVID-19 pandemic, a significant number of our customers have temporarily ceased operations and others have cancelled or pushed back the delivery of pending product orders and/or delayed the start of scheduled theater refurbishing and construction projects. 7 Table of Contents Competition The markets for our products are highly competitive.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

41 edited+4 added−7 removed156 unchanged

2022 filing

2023 filing

Any such disagreement may cause the joint venture or business alliance to be terminated. We may need to raise additional capital required to grow our business, and we may not be able to raise capital on terms acceptable to us or at all. Growing and operating our business will require significant cash outlays and capital expenditures and commitments.

In addition, certain of our officers have built highly regarded reputations in the digital cinema industry, and they aid in attracting and identifying opportunities and negotiating for us with large and institutional clients. As we continue to grow, our success will largely depend on our ability to attract and retain qualified personnel in all areas of business.

Our future success will depend in large part on our ability to attract, train, and retain additional highly skilled executive level management with experience in the digital cinema industry. Competition is intense for these types of personnel from more established organizations, many of which have significantly larger operations and greater financial, marketing, human, and other resources than we have.

Our future success will largely depend in large part on our ability to attract, train, and retain additional highly skilled executive level management with experience in the digital cinema industry. Competition is intense for these types of personnel from more established organizations, many of which have significantly larger operations and greater financial, marketing, human, and other resources than we have.

If we are unable to generate sufficient cost savings to offset any price reductions, our financial condition, operating results and cash flows may be adversely affected. Our international operations subject us to indirect risks, which could adversely affect our operating results. The Company primarily sells internationally thru existing domestic customers.

If we are unable to generate sufficient cost savings to offset any price reductions, our financial condition, operating results and cash flows may be adversely affected. Our international operations subject us to indirect risks, which could adversely affect our operating results. The Company sells internationally thru existing domestic customers.

We will cease to be an “emerging growth company” upon the earliest of: (1) the last day of the fiscal year following the fifth anniversary of our initial public offering, (2) the last day of the first fiscal year in which our annual gross revenues are $1.07 billion or more, (3) the date on which we have, during the previous rolling three-year period, issued more than $1 billion in non-convertible debt securities, and (4) the date on which we are deemed to be a “large accelerated filer” as defined in the Exchange Act. 18 Table of Contents Our status as an “emerging growth company” under the JOBS Act may make it more difficult to raise capital as and when we need it.

We will cease to be an “emerging growth company” upon the earliest of: (1) the last day of the fiscal year following the fifth anniversary of our initial public offering, (2) the last day of the first fiscal year in which our annual gross revenues are $1.235 billion or more, (3) the date on which we have, during the previous rolling three-year period, issued more than $1 billion in non-convertible debt securities, and (4) the date on which we are deemed to be a “large accelerated filer” as defined in the Exchange Act. 18 Table of Contents Our status as an “emerging growth company” under the JOBS Act may make it more difficult to raise capital as and when we need it.

In addition to the factors discussed in this “Risk Factors” section and elsewhere in this Report, these factors include: ● the continuing effects of the COVID-19 pandemic; ● the success of competitive products or technologies; ● actual or anticipated changes in our growth rate relative to our competitors; ● announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures, collaborations or capital commitments; ● regulatory or legal developments in the United States and other countries; ● the recruitment or departure of key personnel; ● the level of expenses; ● changes in our backlog in a given period; ● seasonality in our business, specifically our second fiscal quarter which is traditionally weaker; ● actual or anticipated changes in estimates as to financial results, development timelines or recommendations by securities analysts; ● variations in our financial results or those of companies that are perceived to be similar to us; ● fluctuations in the valuation of companies perceived by investors to be comparable to us; ● inconsistent trading volume levels of our shares; ● announcement or expectation of additional financing efforts; ● sales of our Common Stock by us, our insiders or our other stockholders; 17 Table of Contents ● market conditions in the digital cinema sector; and ● general economic, industry and market conditions.

In addition to the factors discussed in this “Risk Factors” section and elsewhere in this Report, these factors include: ● the success of competitive products or technologies; ● actual or anticipated changes in our growth rate relative to our competitors; ● announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures, collaborations or capital commitments; ● regulatory or legal developments in the United States and other countries; ● the recruitment or departure of key personnel; ● the level of expenses; ● changes in our backlog in a given period; ● seasonality in our business, specifically our second fiscal quarter which is traditionally weaker; ● actual or anticipated changes in estimates as to financial results, development timelines or recommendations by securities analysts; ● variations in our financial results or those of companies that are perceived to be similar to us; ● fluctuations in the valuation of companies perceived by investors to be comparable to us; ● inconsistent trading volume levels of our shares; ● announcement or expectation of additional financing efforts; ● sales of our Common Stock by us, our insiders or our other stockholders; ● market conditions in the digital cinema sector; and 17 Table of Contents ● general economic, industry and market conditions.

In the event of a sustained market deterioration, and continued declines in revenues, we may need additional liquidity, which would require us to evaluate available alternatives and take appropriate actions. We cannot provide any assurance that we will be able to obtain additional sources of financing or liquidity on acceptable terms, or at all.

In the event of a sustained market deterioration, and continued revenue declines, we may need additional liquidity, which would require us to evaluate available alternatives and take appropriate actions. We cannot provide any assurance that we will be able to obtain additional sources of financing or liquidity on acceptable terms, or at all.

The COVID-19 pandemic has had an unprecedented impact on the world and the movie exhibition industry. The social and economic effects have been widespread.

The COVID-19 pandemic had an unprecedented impact on the world and the movie exhibition industry. The social and economic effects have been widespread.

During the course of preparing our consolidated financial statements for the years ended June 30, 2022 and 2021, we determined that we had material weaknesses in our internal control over financial reporting relating to our financial reporting processes relating to (i) the design and operation of our closing and financial reporting process, (ii) the fact that we had no formal or documented accounting policies or procedures, (iii) the fact that certain segregation of duties issues existed and (iv) the fact that there was no formal review process around journal entries recorded.

During the course of preparing our consolidated financial statements for the years ended June 30, 2023 and 2022, we determined that we had material weaknesses in our internal control over financial reporting relating to (i) the design and operation of our closing and financial reporting process, (ii) the fact that we had no formal or documented accounting policies or procedures, (iii) the fact that certain segregation of duties issues existed and (iv) the fact that there was no formal review process around journal entries recorded.

Any potential future acquisitions also involve numerous risks, including: ● problems assimilating the purchased operations, technologies or products; ● costs associated with the acquisition; ● adverse effects on existing business relationships with suppliers and customers; ● risks associated with entering markets in which we have no or limited prior experience; ● potential loss of key employees of purchased organizations; and ● potential litigation arising from the acquired company’s operations before the acquisition.

Any potential future acquisitions also involve numerous risks, including: ● problems assimilating the purchased operations, technologies or products; ● costs associated with the acquisition; 14 Table of Contents ● adverse effects on existing business relationships with suppliers and customers; ● risks associated with entering markets in which we have no or limited prior experience; ● potential loss of key employees of purchased organizations; and ● potential litigation arising from the acquired company’s operations before the acquisition.

While we have implemented a plan to remediate this weakness, we cannot assure you that we will be able to remediate this weakness, which could impair our ability to accurately and timely report our financial position, results of operations or cash flows.

While we have implemented a plan to remediate these weaknesses, we cannot assure you that we will be able to remediate this weakness, which could impair our ability to accurately and timely report our financial position, results of operations or cash flows.

The occurrence of the global COVID-19 pandemic has resulted in, and such other events could result in, among other things, operational disruptions, physical damage to or destruction or disruption of one or more of our properties or properties used by third parties in connection with the supply of products or services to us, the lack of an adequate workforce in parts or all of our operations and communications and transportation disruptions.

The occurrence of the global COVID-19 pandemic has resulted in, and such other events could result in, among other things, operational disruptions, or disruption of one or more of our properties or properties used by third parties in connection with the supply of products or services to us, the lack of an adequate workforce in parts or all of our operations and communications and transportation disruptions.

Specifically, as a result of the effects of the COVID-19 pandemic, a significant number of our customers had temporarily ceased operations and others have cancelled or pushed back the delivery of pending product orders and/or delayed the start of scheduled theater refurbishing and construction projects. We operate in a highly competitive market.

Specifically, as a result 12 Table of Contents of the effects of the COVID-19 pandemic, a significant number of our customers had temporarily ceased operations and others have cancelled or pushed back the delivery of pending product orders and/or delayed the start of scheduled theater refurbishing and construction projects. We operate in a highly competitive market.

The total value of the sales backlog represents all signed agreements that are expected to be recognized as revenue in the future and includes initial fees along with the value of fixed minimum ongoing fees due 12 Table of Contents over the term, but excludes contingent fees in excess of fixed minimum ongoing fees that might be received in the future and maintenance and extended warranty fees.

The total value of the sales backlog represents all signed agreements that are expected to be recognized as revenue in the future and includes initial fees along with the value of fixed minimum ongoing fees due over the term, but excludes contingent fees in excess of fixed minimum ongoing fees that might be received in the future and maintenance and extended warranty fees.

Based on this assessment, management concluded that our internal controls over financial reporting were not effective as of June 30, 2022 due to the material weaknesses described below.

Based on this assessment, management concluded that our internal controls over financial reporting were not effective as of June 30, 2023 due to the material weaknesses described below.

We have been and will continue to be required to expand our operational and financial systems significantly and to expand, train and manage our work force in order to manage the expansion of our operations.

We have been and will continue to be required to expand our operational and financial systems significantly and to expand, train and manage our work force to manage the expansion of our operations.

Confidential intellectual property is increasingly stored or carried on mobile devices, such as laptop computers, which increases the risk of inadvertent disclosure where the mobile devices are lost or stolen and the information has not been adequately safeguarded or encrypted.

If we are not successful in attracting and retaining these personnel, our business, prospects, financial condition and operating results would be materially adversely affected.

If we are not successful in attracting and retain these personnel, our business, prospects, financial condition and operating results would be materially adversely affected.

However, 15 Table of Contents we may not adequately protect these rights, and their disclosure to, or use by, third parties may harm our competitive position. Our inability to detect unauthorized use of, or to take appropriate or timely steps to enforce, our intellectual property rights may harm our business.

However, we may not adequately protect these rights, and their disclosure to, or use by, third parties may harm our competitive position. Our inability to detect unauthorized use of, or to take appropriate or timely steps to enforce, our intellectual property rights may harm our business.

We may not be successful in attracting and retaining qualified personnel on a timely basis, on competitive terms or at all. To date we have had to limit the engagement of critical management and other key personnel due in part to limited financial resources.

We may not be successfully attract and retaining qualified personnel on a timely basis, on competitive terms or at all. To date we have had to limit the engagement of critical management and other key personnel due in part to limited financial resources.

In connection with any such future transaction, we could issue dilutive equity securities, incur substantial debt, reduce our cash reserves or assume contingent liabilities. 14 Table of Contents Our experience in acquiring other businesses, product lines and technologies is limited.

In connection with any such future transaction, we could issue dilutive equity securities, incur substantial debt, reduce our cash reserves or assume contingent liabilities. Our experience in acquiring other businesses, product lines and technologies is limited.

No customer accounted for more than 10% of the Company’s revenue for the year ended June 30, 2022. One customer accounted for 23% of the Company’s revenue for the year ended June 30, 2021. While we believe our relationships with such customers are stable, most arrangements are made by purchase order and are terminable at will by either party.

No customer accounted for more than 10% of the Company’s revenue for the year ended June 30, 2023 or 2022. While we believe our relationships with such customers are stable, most arrangements are made by purchase order and are terminable at will by either party.

Securities litigation against us could result in substantial costs and divert our management’s attention from other business concerns, which could seriously harm our business. Insiders exercise significant control over our company and all corporate matters. Our directors and executive officers beneficially owned, in the aggregate, approximately 30.0% of our outstanding capital stock as of September 15, 2022.

Securities litigation against us could result in substantial costs and divert our management’s attention from other business concerns, which could seriously harm our business. Insiders exercise significant control over our company and all corporate matters. Our directors and executive officers beneficially owned, in the aggregate, approximately 31.6% of our outstanding capital stock as of September 22, 2023.

Our top ten customers accounted for approximately 48% and 55% of net revenues for the years ended June 30, 2022 and 2021, respectively. Trade accounts receivable from these customers represented approximately 48% and 18% of net receivables at June 30, 2022 and 2021, respectively.

Our top ten customers accounted for approximately 37% and 48% of net revenues for the years ended June 30, 2023 and 2022, respectively. Trade accounts receivable from these customers represented approximately 19% and 48% of net receivables at June 30, 2023 and 2022, respectively.

As a result of the aforementioned factors, our financial and operating results for the year ended June 30, 2022 have been and our projected financial and operating results for fiscal 2023 are expected to be materially adversely affected.

As a result of the aforementioned factors, our financial and operating results for the year ended June 30, 2023 have been and our projected financial and operating results for fiscal 2024 will be adversely affected.

We have recently undertaken some new lines of business and intend to continue to opportunistically pursue new lines in the future. For example, Caddy’s product line consists of products we had not previously offered to our customer base.

We are undertaking and may enter into new lines of business and these new business initiatives may not be successful. We have recently undertaken some new lines of business and intend to continue to opportunistically pursue new lines in the future. For example, Caddy’s product line consists of products we had not previously offered to our customer base.

Still, our international operations are exposed to the following risks, several of which are out of our control: ● political and economic instability, the effects of the COVID-19 pandemic, international terrorism and anti-American sentiment, particularly in emerging markets; ● preference for locally-branded products, and laws and business practices favoring local competition; ● unusual or burdensome foreign laws or regulations, and unexpected changes to those laws or regulations; ● import and export license requirements, tariffs, taxes and other barriers; ● costs of customizing products for foreign countries; ● increased difficulty in managing inventory; 13 Table of Contents ● less effective protection of intellectual property; and ● difficulties and costs of staffing and managing foreign operations.

Still, our international operations are exposed to the following risks, several of which are out of our control: ● political and economic instability, international terrorism and anti-American sentiment, particularly in emerging markets; ● preference for locally-branded products, and laws and business practices favoring local competition; ● unusual or burdensome foreign laws or regulations, and unexpected changes to those laws or regulations; ● import and export license requirements, tariffs, taxes and other barriers; ● costs of customizing products for foreign countries; ● increased difficulty in managing inventory; ● less effective protection of intellectual property; and ● difficulties and costs of staffing and managing foreign operations. 13 Table of Contents Any or all of these factors could adversely affect our ability to execute any geographic expansion strategies or have a material adverse effect on our business and results of operations.

At June 30, 2022, our sales backlog was approximately $10.03 million, which represented orders to be shipped substantially in the next six months. We list signed contracts for theater construction or refurbishing for which revenue has not been recognized as sales backlog prior to the time of revenue recognition.

At June 30, 2023, our sales backlog was approximately $12.02 million, which represented orders to be shipped substantially by January 2024. We list signed contracts for theater construction or refurbishing for which revenue has not been recognized as sales backlog prior to the time of revenue recognition.

We could also be adversely affected by such factors as changes in foreign currency rates and weak economic and political conditions in each of the countries in which we sell our products. 11 Table of Contents Our success depends on our ability to maintain our brand.

We could also be adversely affected by such factors as changes in foreign currency rates and weak economic and political conditions in each of the countries in which we sell our products. Our success depends on our ability to maintain our brand. If events occur that damage our brand, our business and financial results may be harmed.

The industry’s recovery to historical levels of new film content, both in terms of the number of new films and box office performance, is still underway, as the 8 Table of Contents industry also continues to adjust to evolving theatrical release windows, competition from streaming and other delivery platforms, supply chain delays, inflationary pressures, labor shortages, wage rate pressures and other economic factors.

The industry’s recovery to historical levels of new film content, both in terms of the number of new films and box office performance, is still underway, as the industry also continues to adjust to evolving theatrical release windows, competition from streaming and other delivery platforms, supply chain delays, inflationary pressures, labor shortages, wage rate pressures and other economic factors. 8 Table of Contents On September 7, 2022, Regal Cinema’s (our customer) parent company, Cineworld, filed for bankruptcy protection due to the slow recovery following the effects of COVID on the industry resulting in a canceled order.

If we are unable to provide efficient and effective customer support, our ability to grow our operations may be harmed and we may need to hire additional support personnel, which could harm our margins and results of operations. Our sales are highly dependent on our business reputation and on positive recommendations from our existing customers.

The number of our business customers has grown significantly, which puts additional pressure on our support organization. If we are unable to provide efficient and effective customer support, our ability to grow our operations may be harmed and we may need to hire additional support personnel, which could harm our margins and results of operations.

We also believe that our reputation and brand may be harmed if we fail to maintain a consistently high level of customer service. If we fail to successfully maintain, promote, and position our brand and protect our reputation or if we incur significant expenses in this effort, our business, financial condition and operating results may be adversely affected.

If we fail to successfully maintain, promote, and position our brand and protect our reputation or if we incur significant expenses in this effort, our business, financial condition and operating results may be adversely affected. Any failure to offer high-quality customer support may harm our relationships with our customers and our results of operations.

Any failure to offer high-quality customer support may harm our relationships with our customers and our results of operations. Our customers depend on our customer support teams to resolve technical and operational issues if and when they arise. We may be unable to respond quickly enough to accommodate short-term increases in customer demand for customer support.

Our customers depend on our customer support teams to resolve technical and operational issues if and when they arise. We may be unable to respond quickly enough to accommodate short-term increases in customer demand for customer support. Customer demand for support may also increase as we expand the features available in our products.

Throughout 2020 and 2021 the theatres reopened as soon as local restrictions and the status of the COVID-19 pandemic would allow. As of June 30, 2022, a large majority of domestic and international theatres were open.

The repercussions of the COVID-19 global pandemic resulted in a significant impact to our customers, specifically those in the entertainment and cinema industries. Through 2020 and 2022 the theatres reopened as soon as local restrictions and the status of the COVID-19 pandemic would allow. As of June 30, 2023, a large majority of domestic and international theatres were open.

If events occur that damage our brand, our business and financial results may be harmed. Our business, results of operations and prospects depend, in part, on our ability to maintain the value of our brand and reputation for providing high quality products and services.

Our business, results of operations and prospects depend, in part, on our ability to maintain the value of our brand and reputation for providing high quality products and services. Maintaining, promoting, and positioning our brand depends largely on the success of our marketing efforts and our ability to provide consistent, high-quality products and services.

Commercial movie exhibitors generate revenues from consumer attendance at their theaters, which depends on the willingness of consumers to visit movie theaters and spend discretionary income at movie theaters.

General political, social and economic conditions can adversely affect our business. Demand for our products and services depends to a significant degree on spending in our markets. Commercial movie exhibitors generate revenues from consumer attendance at their theaters, which depends on the willingness of consumers to visit movie theaters and spend discretionary income at movie theaters.

Our ability to access the credit and capital markets in the future as a source of liquidity, and the borrowing costs associated with such financing, are dependent upon market conditions.

Our ability to access the credit and capital markets in the future as a source of liquidity, and the borrowing costs associated with such financing depend upon market conditions. We cannot provide any assurance that our assumptions used to estimate our liquidity requirements will remain accurate due to the unprecedented nature of the disruption to our operations.

In addition, as we continue to expand our business customer base, we need to be able to provide efficient and effective customer support that meets our business customers’ needs and expectations globally at scale. The number of our business customers has grown significantly, which puts additional pressure on our support organization.

Increased customer demand for customer support, without corresponding revenue, could increase costs and harm our results of operations. In addition, as we continue to expand our business customer base, we need to be able to provide efficient and effective customer support that meets our business customers’ needs and expectations globally at scale.

Such occurrences have had and could in the future have a material adverse effect on us and could also have indirect consequences such as increases in the costs of insurance if they result in significant loss of property or other insurable damage. 16 Table of Contents Risks Related to Ownership of Our Common Stock We do not know whether an active, liquid and orderly trading market will develop for our Common Stock or what the market price of our Common Stock will be and as a result it may be difficult for you to sell your shares of our Common Stock.

A lack of entertainment content featured at the cinema venues that we support as a result entertainment content providers labor disputes, strikes and shutdowns could ultimately have an adverse effect on our financial condition and results of operations. 16 Table of Contents Risks Related to Ownership of Our Common Stock We do not know whether an active, liquid and orderly trading market will develop for our Common Stock or what the market price of our Common Stock will be and as a result it may be difficult for you to sell your shares of our Common Stock.

Maintaining, promoting, and positioning our brand depends largely on the success of our marketing efforts and our ability to provide consistent, high quality products and services. Our brand could be harmed if we fail to achieve these objectives or if our public image or brand were to be tarnished by negative publicity.

Our brand could be harmed 11 Table of Contents if we fail to achieve these objectives or if our public image or brand were to be tarnished by negative publicity. We also believe that our reputation and brand may be harmed if we fail to maintain a consistently high level of customer service.

On September 7, 2022, Regal Cinema’s (our customer) parent company, Cineworld, filed for bankruptcy protection due to the slow recovery following the effects of COVID on the industry. Based on our current estimates of recovery, we believe we have, and will generate, sufficient cash to sustain operations.

On August 1, 2023, Cineworld emerged from bankruptcy. Based on our current estimates of recovery, we believe we have, and will generate, sufficient cash to sustain operations. Nonetheless, the COVID-19 pandemic has had, and continues to have, adverse effects on the Company’s business, results of operations, cash flows and financial condition.

Removed

The repercussions of the COVID-19 global pandemic resulted in a significant impact to our customers, specifically those in the entertainment and cinema industries.

Added

Our sales are highly dependent on our business reputation and on positive recommendations from our existing customers.

Removed

Added

Such occurrences have had and could in the future have a material adverse effect on us and could also have indirect consequences such as increases in the costs of insurance if they result in significant loss of property or other insurable damage. Our business could be adversely affected by entertainment content provider labor disputes, strikes and shutdowns.

Removed

Nonetheless, the COVID-19 pandemic has had, and continues to have, adverse effects on the Company’s business, results of operations, cash flows and financial condition. General political, social and economic conditions can adversely affect our business. Demand for our products and services depends to a significant degree on spending in our markets.

Added

From time to time, entertainment content providers can have labor disputes, strikes and shutdowns that curtail the production and release of entertainment content featured at the cinema venues that we support.

Removed

Specifically, as a result of the effects of the COVID-19 pandemic, a significant number of our customers have cancelled and/or delayed the start of scheduled theater refurbishing and construction projects.

Added

A lack of entertainment content at our customer cinema venues results in revenues losses at the cinema and may impact our customer’s ability to continue with existing or new venue upgrades using our products and services.

Removed

Customer demand for support may also increase as we expand the features available in our products. Increased customer demand for customer support, without corresponding revenue, could increase costs and harm our results of operations.

Removed

Any or all of these factors could adversely affect our ability to execute any geographic expansion strategies or have a material adverse effect on our business and results of operations. We are undertaking and may enter into new lines of business and these new business initiatives may not be successful.

Removed

We cannot provide any assurance that our assumptions used to estimate our liquidity requirements will remain accurate due to the unprecedented nature of the disruption to our operations and the unpredictability of the COVID-19 global pandemic.

Item 2. Properties

Properties — owned and leased real estate

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ITEM 2. PROPERTIES Our corporate headquarters is located in Fountain Valley, California, and covers 28,000 square feet pursuant to an operating lease that expires in 2024 at a monthly rental of $13,791. We also lease an additional 13,000 square foot warehouse facility in Fountain Valley pursuant to an operating lease that expires in 2024 at a monthly rental of $10,343.

ITEM 2. PROPERTIES Our corporate headquarters is located in Fountain Valley, California, and covers 28,000 square feet pursuant to an operating lease that expires in 2024 at a monthly rental of $14,000. We also lease an additional 13,000 square foot warehouse facility in Fountain Valley pursuant to an operating lease that expires in 2024 at a monthly rental of $11,000.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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2023 filing

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our Common Stock is listed on the NYSE American under the symbol “MITQ.” Holders As of September 28, 2022, there were 22 holders of record of our Common Stock. Dividends We have never declared or paid cash dividends on our capital stock.

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our Common Stock is listed on the NYSE American under the symbol “MITQ.” Holders As of September 26, 2023, there were 12 holders of record of our Common Stock. Dividends We have never declared or paid cash dividends on our capital stock.

“Executive Compensation - 2019 Omnibus Incentive Stock Plan.” (c) Number of securities remaining (a) (b) available Number of Weighted- for future securities average issuance to be issued exercise under equity upon price per compensation exercise of share of plans outstanding outstanding (excluding options, options, securities warrants warrants reflected in Plan Category and rights and rights column (a)) Equity compensation plans approved by stockholders 150,000 3.00 600,000 Equity compensation plans not approved by stockholders — — — Total 150,000 3.00 600,000 ITEM 6.

“Executive Compensation - 2019 Omnibus Incentive Stock Plan.” (c) Number of securities remaining (a) (b) available Number of Weighted- for future securities average issuance to be issued exercise under equity upon price per compensation exercise of share of plans outstanding outstanding (excluding options, options, securities warrants warrants reflected in Plan Category and rights and rights column (a)) Equity compensation plans approved by stockholders 250,000 1.10 1,220,000 Equity compensation plans not approved by stockholders — — — Total 250,000 1.10 1,220,000 ITEM 6.

As a result, capital appreciation, if any, of our shares of common stock will be your sole source of gain for the foreseeable future. 22 Table of Contents Issuer’s Purchases of Equity Securities None. Securities Authorized for Issuance Under Equity Compensation Plans The following table summarizes our equity compensation plan information as of June 30, 2022.

As a result, capital appreciation, if any, of our shares of common stock will be your sole source of gain for the foreseeable future. 22 Table of Contents Issuer’s Purchases of Equity Securities On March 23, 2023, the Board of Directors re-authorized a stock repurchase program.

Added

Under the stock repurchase program, the Company may repurchase up to $1 million of its outstanding Common Stock over the next 12 months. .

Added

For the year ended June 30, 2023, the Company repurchased a combined total of 272,620 share representing 2.55% of the 10,685,778 outstanding shares at the end of June 30, 2023 at an average price of $1.111 per share.

Added

During three months ended June 30, 2023, the Company repurchased 225,153 shares of the Company’s Common Stock, as follows: Total Number of Approximate Shares Dollar Value of Purchased as Shares that May Total Number of Part of Publicly Yet Be Purchased Shares Average Price Announced Plans Under the Plans Period Purchased Paid per Share or Programs or Programs May 1 - June 30, 2023 225,153 $ 1.13 $ 225,153 $ 697,000 Total 225,153 $ 1.13 $ 225,153 $ 697,000 Securities Authorized for Issuance Under Equity Compensation Plans The following table summarizes our equity compensation plan information as of June 30, 2023.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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2023 filing

Liquidity and Capital Resources During the past several years, we have primarily met our working capital and capital resource needs from our operating cash flows and financing activities. We believe that our existing sources of liquidity, including cash, credit facilities and operating cash flow, will be sufficient to meet our projected capital needs for the foreseeable future.

Liquidity and Capital Resources During the past several years, we have primarily met our working capital and capital resource needs from our operating cash flows and financing activities. We believe that our existing sources of liquidity, including cash and operating cash flow, will be sufficient to meet our projected capital needs for the foreseeable future.

Examples of these products include our ADA-compliant accessibility products and our Caddy brand, a leading provider of proprietary cup holders, trays, and other products sold into our strategic markets of motion picture 23 Table of Contents exhibition, entertainment, and sports venues as well as other non-strategic markets.

Throughout 2020 to 2022 the theatres reopened as soon as local restrictions and the status of the COVID-19 pandemic would allow. As of June 30, 2023, a large majority of domestic and international theatres were open.

This asset purchase agreement was not within the Company's normal policy of acquiring small amounts of inventory, however the Company viewed this purchase as a strategic opportunity to expand its strategy of enabling under-served communities to enjoy the movie going experience and as such entered into this transaction.

This asset purchase agreement was not within the Company's normal policy of acquiring small amounts of inventory, however management viewed this purchase as a strategic opportunity to improve its gross margins and expand its strategy of enabling under-served communities to enjoy the movie going experience and as such entered into this transaction.

We have invested, and intend to continue to invest, in expanding our operations, increasing our headcount, developing our products and services to support our growth and expanding our infrastructure. We expect our total 24 Table of Contents operating expenses to increase in the foreseeable future to meet our growth objectives.

We have invested, and intend to continue to invest, in expanding our operations, increasing our headcount, developing our products and services to support our growth and expanding our infrastructure. We expect our total operating expenses to increase in the foreseeable future to meet our growth objectives.

As of June 30, 2022, a large majority of domestic and international theatres were open.

As of June 30, 2023, a large majority of domestic and international theatres were open.

The net change in working capital was primarily due to a decrease in accounts payable and prepaid and other, offset by a decrease in accounts receivable and an increase in customer deposits. Cash Flows from Investing Activities Net cash used in investing activities was $4.96 million for the year ended June 30, 2022.

The net change in working capital was primarily due to a decrease in accounts payable and prepaid and other, offset by a decrease in accounts receivable and an increase in customer deposits. Cash Flows from Investing Activities Net cash provided by investing activities was $(4.31) million for the year ended June 30, 2023.

Financial Instruments and Credit Risk Concentrations Our top ten customers accounted for approximately 48% and 55% of net revenues for the years ended June 30, 2022 and 2021, respectively. Trade accounts receivable from these customers represented approximately 48% and 18% of net receivables at June 30, 2022 and 2021, respectively.

Financial Instruments and Credit Risk Concentrations Our top ten customers accounted for approximately 37% and 48% of net revenues for the years ended June 30, 2023 and 2022, respectively. Trade accounts receivable from these customers represented approximately 19% and 48% of net receivables at June 30, 2023 and 2022, respectively.

Net sales The principal factors that have affected or could affect our net sales from period to period are: ● The condition of the economy in general and of the cinema and/or cinema equipment industry in particular, ● Our customers’ adjustments in their order levels, ● Seasonality in our business, specifically our second fiscal quarter which is traditionally weaker, ● Changes in our pricing policies or the pricing policies of our competitors or suppliers, ● The addition or termination of key supplier relationships, 25 Table of Contents ● The rate of introduction and acceptance by our customers of new products and services, ● Our ability to compete effectively with our current and future competitors, ● Our ability to enter into and renew key relationships with our customers and vendors, ● Changes in foreign currency exchange rates, ● A major disruption of our information technology infrastructure, ● Unforeseen catastrophic events such as the COVID-19 pandemic, armed conflict, terrorism, fires, typhoons and earthquakes, and ● Any other disruptions, such as labor shortages, unplanned maintenance or other manufacturing problems.

Accordingly, backlog, the recognition of backlog into revenue and related earnings may fluctuate from quarter to quarter depending on our customers’ particular requirements, which can sometimes change between the initial signing of a contract to its ultimate fulfillment. 25 Table of Contents Net sales The principal factors that have affected or could affect our net sales from period to period are: ● The condition of the economy in general and of the cinema and/or cinema equipment industry in particular, ● Our customers’ adjustments in their order levels, ● Seasonality in our business, specifically our second fiscal quarter which is traditionally weaker, ● Changes in our pricing policies or the pricing policies of our competitors or suppliers, ● The addition or termination of key supplier relationships, ● The rate of introduction and acceptance by our customers of new products and services, ● Our ability to compete effectively with our current and future competitors, ● Our ability to enter into and renew key relationships with our customers and vendors, ● Changes in foreign currency exchange rates, ● A major disruption of our information technology infrastructure, ● Unforeseen catastrophic events such as the COVID-19 pandemic, armed conflict, terrorism, fires, typhoons and earthquakes, and ● Any other disruptions, such as labor shortages, unplanned maintenance or other manufacturing problems.

The future estimated payments under these arrangements are summarized below: (in 000’s) Total Operating leases Payments 2023 $ 293 2024 302 2025 174 Total future lease payments $ 769 There were no other material contractual obligations other than inventory and property, plant and equipment purchases in the ordinary course of business.

The future estimated payments under these arrangements are summarized below: (in 000’s) Total Operating leases Payments 2024 302 2025 154 Total future lease payments $ 456 There were no other material contractual obligations other than inventory, property and production and computer equipment purchases in the ordinary course of business.

Our accounting policies are discussed in Note 1 to the financial statements in this Report. Management believes the following critical accounting policies reflect its more significant estimates and assumptions used in the preparation of the financial statements. Revenue Recognition The Company follows Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (“ASC 606”).

Management believes the following critical accounting policies reflect its more significant estimates and assumptions used in the preparation of the financial statements. 30 Table of Contents Revenue Recognition The Company follows Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (“ASC 606”).

Factors affecting our performance Effect of COVID-19 global pandemic .The COVID-19 pandemic has had an unprecedented impact on the world and the movie exhibition industry. The social and economic effects have been widespread.

The COVID-19 pandemic has had an unprecedented impact on the world and the movie exhibition industry. The social and economic effects have been widespread.

On July 7, 2021, the Company completed an initial public offering resulting in net proceeds of approximately $11.24 million. Our cash balance at June 30, 2022 was approximately $2.34 million, as compared to $1.27 million at June 30, 2021. Our short-term investments balance at June 30, 2022 was $4.36 million compared to $0 at June 30, 2021.

On July 7, 2021, the Company completed an initial public offering resulting in net proceeds of approximately $11.24 million. Our cash balance at June 30, 2023 was approximately $6.62 million, as compared to $2.34 million at June 30, 2022.

Financial instruments that potentially expose us to a concentration of credit risk principally consist of accounts receivable and notes receivable. We sell products to a large number of customers in many different geographic regions. To minimize credit concentration risk, we perform ongoing credit evaluations of our customers’ financial condition or use letters of credit.

Results of Operations Year ended June 30, 2022 compared to year ended June 30, 2021 Net sales Year Ended June 30, (in 000’s) 2022 2021 $ 18,351 $ 7,247 Net revenues increased 153.2% to $18.35 million for the year ended June 30, 2022 from $7.25 million for the prior fiscal year primarily due to the recovery from the impact of COVID-19 on the exhibition industry.

Results of Operations Year ended June 30, 2023 compared to year ended June 30, 2022 Net sales Year Ended June 30, (in 000’s) 2023 2022 $ 20,207 $ 18,351 Net revenues increased 10.1% to $20.21 million for the year ended June 30, 2023 from $18.35 million for the prior fiscal year primarily due to the recovery from the impact of COVID-19 on the exhibition industry.

As a result, the historical financial statements of MiT LLC and MiT Inc. for the year ended June 30, 2021 have been retroactively revised to reflect the consolidation of MiT, Inc. and MiT LLC. All inter-company transactions and balances between MiT Inc. and MiT, LLC have been eliminated.

As a result, the historical financial statements of MiT LLC and MiT Inc. for the year ended June 30, 2022 have been retroactively revised to reflect the consolidation of MiT, Inc. and MiT LLC. All inter-company transactions and balances between MiT Inc. and MiT, LLC have been eliminated. Factors affecting our performance Effect of COVID-19 global pandemic .

Backlog at June 30, 2022 was approximately $10.03 million, which represented orders currently planned to be shipped substantially by December 31, 2022. Backlog at June 30, 2021 was $9.44 million. All open orders at June 30, 2021, except one for approximately $0.2 million due to customer deferral, were fulfilled in FY 2022.

Backlog at June 30, 2023 was approximately $12.02 million, which represented orders currently planned to be shipped substantially by January 31, 2024. Backlog at June 30, 2022 was $10.03 million. All open orders at June 30, 2022, except one for approximately $0.2 million due to customer deferral, were fulfilled in the fiscal year 2023.

Inherent in the estimates of net realizable values are management’s estimates related to customer demand and the development of new technology, which could make our theater and digital media products obsolete, among other items. Income Taxes The Company utilizes an asset and liability approach for financial accounting and reporting for income taxes.

Net cash used in operating activities was $1.7 million for the year ended June 30, 2021, due to the operating loss combined with, the negative cash impact of the gain on forgiveness of debt and net changes in working capital items of approximately $200,000.

Net cash used in operating activities was $3.39 million for the year ended June 30, 2022, due to the operating loss combined with, the non-cash gain on forgiveness of debt and net changes in working capital items of approximately $0.20 million.

As a result, the Company implemented various cash preservation strategies, including, but not limited to, temporary personnel and salary reductions, halting non-essential operating and capital expenditures, and negotiating modified timing and/or abatement of contractual payments with landlords and other major suppliers. 24 Table of Contents Throughout 2020 and 2021 the theatres reopened as soon as local restrictions and the status of the COVID-19 pandemic would allow.

Net cash provided by financing activities of $1.36 million for the year ended June 30, 2021 was due to proceeds from our private placement of securities, plus proceeds received for the PPP loan, less payments on notes payable and our line of credit.

Net cash provided by financing activities of $9.41 million for the year ended June 30, 2022 was due to proceeds received from the IPO, less payments on notes payable and our line of credit.

A large part of our business is concerned with new theater builds, which often see substantial delays due to weather, but also financing 29 Table of Contents timing, permits and governmental delays, and other unpredictable problems often associated with large real estate projects.

Seasonality Our operating results can vary from quarter to quarter as a result of seasonality in consumer spending and payment patterns. A large part of our business is concerned with new theater builds, which often see substantial delays due to weather, but also financing timing, permits and governmental delays, and other unpredictable problems often associated with large real estate projects.

Taxes collected from customers are included in Accounts Payable on a net basis (excluded from revenues) until remitted to the government. Deferred contract acquisition costs consist of sales commissions paid to the sales force and the related employer payroll taxes, collectively “deferred contract acquisition costs”, are considered incremental and recoverable costs of obtaining a contract with a customer.

Deferred contract acquisition costs consist of sales commissions paid to the sales force and the related employer payroll taxes, collectively “deferred contract acquisition costs”, are considered incremental and recoverable costs of obtaining a contract with a customer.

Inflation We believe that the relatively moderate rates of inflation in recent years have not had a significant impact on our net revenues or profitability. During the year ended June 30, 2022, inflation increased to levels not seen since the 1980’s. The Company has historically been able to offset any inflationary effects by either increasing prices or improving cost efficiencies.

Inflation We believe that the relatively moderate rates of inflation in recent years have not had a significant impact on our net revenues or profitability. During the fiscal year ended June 30, 2023, inflation increased to levels not seen since the 1980’s.

This was comprised primarily of investments in marketable securities. Net cash provided by investing activities was $548,000 for the year ended June 30, 2021. This was comprised predominately of sales of marketable securities. Cash Flows from Financing Activities Net cash provided by financing activities was $9.41 million for the year ended June 30, 2022.

This was comprised primarily of marketable securities investment sales. Net cash used by investing activities was $(4.96) million for the year ended June 30, 2022 was comprised predominately of sales of marketable securities. Cash Flows from Financing Activities Net cash provided by financing activities was ($0.30) million for the year ended June 30, 2023 due the stock buyback program.

Actual results and the timing of events may differ materially from those stated in or implied by these forward-looking statements due to a number of factors, including those discussed in the sections entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements”, and elsewhere in this Report. 23 Table of Contents Overview We are a key provider of technology, products, and services to movie theater operators and sports and entertainment venues. 1) We provide a set of valuable services to movie theater operators and other critical screening and viewing rooms.

If there are circumstances where the above criteria are not met, revenues recognized are presented net of cost of goods sold. Contract assets consist of conditional or unconditional rights to consideration. Accounts receivable represent amounts billed to customers where the Company has an enforceable right to payment for performance completed to date (i.e., unconditional rights to consideration).

In addition, the margin increase was affected by an increase in higher margin Caddy cupholder sales. Research and Development Year Ended June 30, (in 000’s) 2022 2021 $ 238 $ 152 The increase in research and development expense was primarily associated with the impact of COVID-19 on 2021.

Research and Development Year Ended June 30, (in 000’s) 2023 2022 $ 261 $ 238 The increase in research and development expense was primarily associated with the impact of COVID-19 I in 2022.

Gross Profit Year Ended June 30, (in 000’s), 2022 2021 $ 4,461 $ 1,689 Gross profit increased 164.1% to $4.46 million for the year ended June 30, 2022 from $1.69 million for the prior fiscal year.

Gross Profit Year Ended June 30, (in 000’s), 2023 2022 $ 5,310 $ 4,461 Gross profit increased 19.0% to $5.31 million or by $0.85 million for the year ended June 30, 2023 from $4.46 million for the prior fiscal year.

As a percentage of total revenues, gross margin increased to 24.3% for the year ended June 30, 2022 from 23.3% for the prior year. The increase in gross margin as a percentage of revenues was driven primarily by product mix, as higher margin parts and services revenues made up a larger percentage of total revenues.

The increase in gross margin as a percentage of revenues was driven primarily by product mix, as higher margin parts and services revenues such as the QSC LLC purchases made up a larger percentage of total revenues.

Net Loss Year Ended June 30, (in 000’s) 2022 2021 $ (1,345) $ (645) Net loss was $(1.35) million for the year ended June 30, 2022 compared to a net loss of $(0.645) million for the prior year.

In 2022, the $(0.24) million unrealized loss was offset by $(0.71) million in PPP loan forgiveness for a net $(0.42) million. Net Loss Year Ended June 30, (in 000’s) 2023 2022 $ (1,798) $ (1,345) Net loss of $(1.80) million for the year ended June 30, 2023 compared to a net loss of $(1.35) million for the prior year increased by $(0.45) million.

Based on the Company’s current estimates of recovery, it believes it has, and will generate, sufficient cash to sustain operations.

Based on the Company’s current estimates of recovery, it believes it has, and will generate, sufficient cash to sustain operations. Nonetheless, the COVID-19 pandemic has had, and continues to have, adverse effects on the Company’s business, results of operations, cash flows and financial condition.

We expect research and development expense to increase as a percentage of sales in the future as we continue to increase product development on our green product line, SaaS (software as a service) products, LED screen support systems, Caddy products, and others as our business expands into new areas. 27 Table of Contents Selling, General and Administrative Expense Year Ended June 30, (in 000’s) 2022 2021 $ 5,985 $ 3,098 The increase in selling, general and administrative expense was due primarily to the impact of COVID-19 in the prior period as the Company instituted cost containment measures, such as headcount reduction, executive pay reduction and cost avoidance.

We expect research and development expense and headcount to increase as a percentage of sales in the future as we continue to increase product development on our green product line, SaaS (software as a service) products, LED screen support systems, Caddy products, and others as our business expands into new areas.

Recently Issued Accounting Pronouncements See Note 1, Business Activity and Summary of Significant Accounting Policies, to the consolidated financial statements for a description of recently issued accounting pronouncements. Critical Accounting Policies and Estimates The following accounting policies involve judgments and estimates used in preparation of the financial statements.

Critical Accounting Policies and Estimates The following accounting policies involve judgments and estimates used in preparation of the financial statements.

Off-Balance Sheet Arrangements and Contractual Obligations Our Contractual Obligations consist principally of leasing equipment and facilities under operating leases.

To minimize credit concentration risk, we perform ongoing credit evaluations of our customers’ financial condition or use letters of credit. 29 Table of Contents Off-Balance Sheet Arrangements and Contractual Obligations Our contractual obligations consist principally of leasing equipment and facilities under operating leases.

Such deposits are reflected as customer deposits and recognized in revenue when control of the products is transferred or when performance conditions are satisfied per the agreement. Cost of goods sold includes cost of inventory sold during the period, net of vendor discounts and allowances, and shipping and handling costs, and sales taxes.

Contract liabilities consist of refund and warranty liabilities, as well as deposits received in advance on sales to certain customers. Such deposits are reflected as customer deposits and recognized in revenue when control of the products is transferred or when performance conditions are satisfied per the agreement.

In response to uncertainties associated with the COVID-19 pandemic, we took significant steps to preserve cash and remain in a strong competitive position for when the crisis subsided. Throughout 2020 and 2021 the theatres reopened as soon as local restrictions and the status of the COVID-19 pandemic would allow.

Our short-term investments balance at June 30, 2023 was $0.00 million compared to the $4.36 million short-term investment balance at June 30, 2022 as the Company sold its investments in March 2023. 28 Table of Contents In response to uncertainties associated with the COVID-19 pandemic, we took significant steps to preserve cash and remain in a strong competitive position for when the crisis subsided.

Interest and Other (Expense)/ Income Year Ended June 30, (in 000’s) 2022 2021 $ 417 $ 916 The change in interest and other (expense)/income was primarily due to unrealized losses on marketable securities in the 2022 year.

The Company incurred no impairment costs during the year ended June 30, 2022. Interest and Other Expense/(Income) Year Ended June 30, (in 000’s) 2023 2022 $ (177) $ (417) The Company realized investment income including dividends and interest earned in 2023 compared to investment losses in 2022.

Removed

Overview We are a leading provider of technology, products, and services to movie theater operators and sports and entertainment venues. 1) We provide a set of valuable services to movie theater operators and other critical screening and viewing rooms.

Added

As a percentage of total revenues, gross margin increased to 26.3% for the year ended June 30, 2023 from 24.3% for the prior year.

Removed

Added

Selling, General and Administrative Expense Year Ended June 30, (in 000’s) 2023 2022 $ 6,070 $ 5,985 27 Table of Contents 2023 Selling, General and Administrative expense increased by a negligible $85,000 or 1% compared to 2022 as the Company controlled its spending in 2023. Impairment of Long Term Assets Year Ended June 30, (in 000’s) 2023 2022 $ 954 $ — During the year ended June 30, 2023 the Company impaired Goodwill, Intangible and Note Receivable assets totaling $0.954 million.

Removed

Additionally, during the year ended June 30, 2022 the Company incurred significant expenses associated with becoming a public company, such as increased legal, accounting and other regulatory costs.

Added

Due to a decline in Caddy revenues in the year ended 2023, the customer relations Intangible and Goodwill assets incurred an impairment charge.

Removed

This increase in net loss was predominately driven by higher selling, general and administrative expenses that offset increases in gross margin. In addition, net loss impacted by realized gain on investments of $0.459 million in 2021 versus and $0.242 million unrealized loss on investments in 2022, offset by a $0.197 million decrease in interest expense.

Added

To reduce volatility in investments and assure stable returns, the Company liquidated its marketable securities portfolio in March 2023 and placed the proceeds into a savings account.

Removed

Nonetheless, the COVID-19 pandemic has had, and continues to have, adverse effects on the Company’s business, results of operations, cash flows and financial condition. 28 Table of Contents Cash Flows from Operating Activities Net cash used in operating activities was $3.39 million for year ended June 30, 2022, due primarily to the operating loss combined with an increase in accounts receivable, an increase in inventory, offset by an increase in customer deposits.

Added

This net loss increase was largely due to the 2023 $(0.95) million Impairment of Long Term Assets, stock option expense of $(0.27) million in 2023 offset by higher gross margin of $0.85 million.

Removed

This increase was predominately due to the net proceeds of $11.2 million received from our IPO, offset by payments on Notes payable and our line of credit.

Added

Cash Flows from Operating Activities Net cash provided by operating activities was $0.27 million for year ended June 30, 2023 including the operating loss of $(1.80) million. Other sources of cash provided included accounts receivable, recovery of bad debts, non-cash impairment and amortization expense, non-cash option expense, and a decline in prepaid expense totaling $2.82 million.

Removed

Seasonality Our operating results can vary from quarter to quarter as a result of seasonality in consumer spending and payment patterns.

Added

Other uses of cash included a realized loss on investments, inventory increases to support the increased sales and related increases in accounts payable and lease liability totaling $(0.75) million.

Removed

Accounts receivable represent amounts billed to customers where the Company has an enforceable right to payment for performance completed to date (i.e., unconditional rights to consideration). 30 Table of Contents Contract liabilities consist of refund and warranty liabilities, as well as deposits received in advance on sales to certain customers.

Added

Historically, the Company has been able to offset any inflationary effects by either increasing prices or improving cost efficiencies and expects to do so in the future. Recently Issued Accounting Pronouncements See Note 1, Business Activity and Summary of Significant Accounting Policies, to the consolidated financial statements for a description of recently issued accounting pronouncements.

Removed

Income Taxes Prior to the effective date of the IPO, the operating company was a limited liability company treated as a partnership for federal and state income tax purposes with all income tax liabilities and/or benefits of MiT LLC being passed through to the members.

Added

Our accounting policies are discussed in Note 1 to the financial statements in this Report.

Removed

As such, there is no recognition of federal or state income taxes provided for in the year ended June 30, 2021 financial statements. Any uncertain tax position taken by the members is not an uncertain position of the Company.

Added

Cost of goods sold includes cost of inventory sold during the period, net of vendor discounts and allowances, and shipping and handling costs, and sales taxes. Taxes collected from customers are included in Accounts Payable on a net basis (excluded from revenues) until remitted to the government.

Removed

In accordance with the operating agreement of MiT LLC, to the extent possible without impairing MiT LLC’s ability to continue to conduct its business and activities, and in order to permit its members to pay taxes on the taxable income of MiT LLC, MiT LLC made distributions to members in the amounts equal to the estimated tax liability of its members computed as if members paid income tax at the highest marginal federal and state rate applicable to an individual resident of Fountain Valley, CA.

Added

The provisions for income taxes is based upon income or loss after adjustment for those permanent items that are not considered in the determination of taxable income.

Removed

Upon the effective date the IPO, the former MiT LLC members were eligible to receive a final tax distribution consisting of income taxes payable on MiT LLC earnings from January 1, 2019 through the effective date of the IPO (the “Final Tax Distribution”).

Added

Deferred income taxes represent the tax effects of difference between the financial reporting and tax basis of the Company’s assets and liabilities at the enacted tax rates in effect for the years in which the difference are expected to reverse.

Removed

Purchasers of shares of common stock in the IPO did not receive any portion of the Final Tax Distribution. On and after such date, we became fully subject to federal and state income taxes.

Added

The effects on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date.

Removed

We have agreed to pay, and to indemnify, defend and hold harmless the members of MiT LLC from any taxes which may at any time be asserted with respect to the Share Exchange. ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Not applicable. ITEM 8.

Added

Deferred tax assets are reduced by valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. 31 Table of Contents ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Not applicable. ITEM 8.

MOVING iMAGE TECHNOLOGIES INC.MITQEarnings & Financial Report

Top changes in MOVING iMAGE TECHNOLOGIES INC.'s 2023 10-K

Item 1. Business

Item 1A. Risk Factors

Item 2. Properties

Item 5. Market for Registrant's Common Equity

Item 7. Management's Discussion & Analysis

Other MITQ 10-K year-over-year comparisons