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What changed in AgEagle Aerial Systems Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of AgEagle Aerial Systems Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+231 added−318 removedSource: 10-K (2025-03-31) vs 10-K (2024-04-01)

Top changes in AgEagle Aerial Systems Inc.'s 2024 10-K

231 paragraphs added · 318 removed · 176 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

55 edited+18 added−84 removed73 unchanged
Biggest changeRegistration Date Status (RE)DEFINING AGRICULTURAL DRONE SENSING US 88 /521832 7/18/2019 6078193 6/16/2020 Registered ALTUM US 88 /412439 5/2/2019 6823409 8/23/2022 Registered US 97 /174411 12/15/2021 6918181 12/6/2022 Registered Canada 2198057 6/15/2022 Pending China 6/15/2022 1672211 6/15/2022 Registered ALTUM-PT European Union 6/15/2022 1672211 6/15/2022 Registered Japan 6/15/2022 Pending Mexico 6/15/2022 Pending Madrid Protocol A0124015 6/15/2022 1672211 6/15/2022 Registered MICASENSE US 86 /659942 6/11/2015 4922111 3/22/2016 Registered REDEDGE US 88 /749873 1/7/2020 6344611 5/11/2021 Registered REDEDGE-MX US 88 /749880 1/7/2020 6359035 5/25/2021 Registered US 97 /105307 11/2/2021 6917109 12/6/2022 Registered Canada 2189471 4/29/2022 Pending 20 REDEDGE-P European Union 4/29/2022 1664529 4/29/2022 Registered Japan 4/29/2022 Pending Mexico 4/29/2022 Pending Madrid Protocol A0122452 4/29/2022 1664529 4/29/2022 Registered THE SENSOR THAT DOESN’T COMPROMISE US 88 /521846 7/18/2019 6062427 5/26/2020 Registered AGEAGLE US 68 /08302 7/20/2021 90837274 8/2/2022 Registered THE DRONE AGE US 88 /946058 6/3/2020 Pending Canada 2068393 12/3/2020 Pending SENSEFLY, A KAMBILL COMPANY AND DESIGN India 12/16/2021 5249406 8/1/2022 Registered Australia 3/13/2013 1553690 3/13/2013 Registered Brazil 3/25/2013 840461313 1/12/2016 Registered Brazil 3/25/2013 840461305 3/6/2018 Registered Canada TMA932233 3/15/2013 1618501 3/21/2016 Registered China 3/13/2013 1156183 12/24/2013 Registered European Union 3/13/2013 1156183 3/13/2017 Registered EBEE Russia 3/13/2013 1156183 11/13/2014 Registered South Africa 2013/06574 3/14/2013 Pending South Africa 2013/06573 3/14/2013 Pending Switzerland 61158/2012 9/18/2012 638841 1/21/2013 Registered US 79128567 3/13/2013 4503673 4/1/2014 Registered WIPO 3/13/2013 7/8/5065 3/13/2013 Registered Australia 1/22/2015 1241930 1/22/2015 Registered Brazil 1/30/2015 908933975 Registered China 1/22/2015 1241930 1/22/2015 Registered European Union 1/22/2015 1241930 1/22/2015 Registered EXOM Russia 1/22/2015 1241930 1/22/2015 Registered South Africa 1/23/2015 2015/01806 Pending Switzerland 59684/2014 8/20/2014 663964 9/24/2014 Registered WIPO 1/22/2015 1241930 1/22/2015 Registered United Kingdom 1/22/2015 UK00801241930 2/11/2016 Registered Australia 11/8/2011 1100123 11/8/2011 Registered Brazil 3/4/2016 910715637 4/17/2018 Registered Brazil 3/4/2016 910715580 4/17/2018 Registered Canada TMA1013798 2/25/2016 1769512 1/24/2019 Registered China 11/8/2011 1100123 11/8/2011 Registered SENSEFLY European Union 11/8/2011 1100123 11/8/2011 Registered Russia 11/8/2011 1100123 11/8/2011 Registered Switzerland 62950/2010 5/8/2011 615741 5/26/2011 Registered US 79106546 11/8/2011 4166369 7/3/2012 Registered WIPO 1100123 11/8/2011 Registered Australia 9/9/2016 1814255 9/9/2016 Registered China 1322220 9/9/2016 Registered European Union 132220 9/9/2016 Registered ALBRIS Russia 132220 9/9/2016 Registered Switzerland 53355/2016 3/16/2016 685791 3/30/2016 Registered US 79197603 9/9/2016 5178765 4/11/2017 Registered WIPO 132220 9/9/2016 Registered EBEE TAC Switzerland 15306/2020 10/29/2020 754619 11/6/2020 Registered WIPO 4/21/2021 1615756 4/21/2021 Registered 21 Patents and Pending Patents Invention Name Country Code Status Application No.
Biggest changeRegistration Date Status (RE)DEFINING AGRICULTURAL DRONE SENSING US 88 /521832 7/18/2019 6078193 6/16/2020 Registered ALTUM US 88 /412439 5/2/2019 6823409 8/23/2022 Registered ALTUM-PT US 97 /174411 12/15/2021 6918181 12/6/2022 Registered Canada 2198057 6/15/2022 1672211 6/15/2022 Registered China 6/15/2022 1672211 6/15/2022 Registered European Union 6/15/2022 1672211 6/15/2022 Registered Japan 6/15/2022 6/15/2022 Registered Mexico 6/15/2022 6/15/2022 Registered Madrid Protocol A0124015 6/15/2022 1672211 6/15/2022 Registered MICASENSE US 86 /659942 6/11/2015 4922111 3/22/2016 Registered REDEDGE US 88 /749873 1/7/2020 6344611 5/11/2021 Registered REDEDGE-MX US 88 /749880 1/7/2020 6359035 5/25/2021 Registered REDEDGE-P US 97 /105307 11/2/2021 6917109 12/6/2022 Registered Canada 2189471 4/29/2022 1664529 4/29/2022 Registered 14 REDEDGE-P European Union 4/29/2022 1664529 4/29/2022 Registered Japan 4/29/2022 1664529 4/29/2022 Registered Mexico 4/29/2022 1664529 4/29/2022 Registered Madrid Protocol A0122452 4/29/2022 1664529 4/29/2022 Registered THE SENSOR THAT DOESN’T COMPROMISE US 88 /521846 7/18/2019 6062427 5/26/2020 Registered AGEAGLE US 90/837274 7/20/2021 6808302 8/2/2022 Registered Canada 2068393 12/3/2020 Pending SENSEFLY, A KAMBILL COMPANY AND DESIGN India 5249406 12/16/2021 3020013 7/23/2022 Registered Australia 1553690 3/13/2013 1156183 3/13/2013 Registered Brazil 3/25/2013 840461313 1/12/2016 Registered Brazil 3/25/2013 840461305 3/6/2018 Registered Canada 1618501 3/15/2013 TMA932233 3/21/2016 Registered China 3/13/2013 1156183 03/13/2013 Registered European Union 3/13/2013 1156183 3/13/2013 Registered EBEE Russia 3/13/2013 1156183 3/13/2013 Registered Switzerland 61158/2012 9/18/2012 638841 1/21/2013 Registered US 79128567 3/13/2013 4503673 4/1/2014 Registered WIPO 3/13/2013 1156183 3/13/2013 Registered United Kingdom UK00801156183 3/13/2013 UK00801156183 9/21/2016 Registered EXOM Australia 1/22/2015 1241930 1/22/2015 Registered China 1/22/2015 1241930 1/22/2015 Registered European Union 1/22/2015 1241930 1/22/2015 Registered Russia 1/22/2015 1241930 1/22/2015 Registered South Africa 2015/01806 1/23/2015 2015/01806 6/19/2017 Registered Switzerland 59684/2014 8/20/2014 663964 9/24/2014 Registered WIPO 1/22/2015 1241930 1/22/2015 Registered SENSEFLY Australia 11/8/2011 1100123 11/8/2011 Registered Brazil 3/4/2016 910715637 4/17/2018 Registered Brazil 3/4/2016 910715580 4/17/2018 Registered Canada 1769512 2/25/2016 TMA1013787 1/24/2019 Registered China 11/8/2011 1100123 11/8/2011 Registered European Union 11/8/2011 1100123 11/8/2011 Registered Russia 11/8/2011 1100123 11/8/2011 Registered Switzerland 62950/2010 5/8/2011 615741 5/26/2011 Registered WIPO 1100123 11/8/2011 Registered United Kingdom UK00801322220 9/9/2016 UK00801322220 5/11/2017 Registered ALBRIS Australia 1814255 9/9/2016 1322220 9/9/2016 Registered China 1322220 9/9/2016 Registered European Union 132220 9/9/2016 Registered ALBRIS Russia 132220 9/9/2016 Registered Switzerland 53355/2016 3/16/2016 685791 3/30/2016 Registered US 79197603 9/9/2016 5178765 4/11/2017 Registered WIPO 132220 9/9/2016 Registered EBEE TAC Switzerland 15306/2020 10/29/2020 754619 11/6/2020 Registered WIPO 4/21/2021 1615756 4/21/2021 Registered 15 Patents and Pending Patents Invention Name Country Code Status Application No.
Being the first company to receive this DVR from EASA for M2 mitigation is a milestone for AgEagle and our industry in the European Union and will be key to fueling growth of our international customer base. 16 ● Our global reseller network currently has more than 200 drone solutions providers in 75+ countries – By leveraging our relationships with the specialty retailers that comprise our global reseller network, AgEagle benefits from enhanced brand-building, lower customer acquisition costs and increased reach, revenues and geographic and vertical market penetration.
Being the first company to receive this DVR from EASA for M2 mitigation is a milestone for AgEagle and our industry in the European Union and will be key to fueling growth of our international customer base. ● Our global reseller network currently has more than 200 drone solutions providers in 75+ countries – By leveraging our relationships with the specialty retailers that comprise our global reseller network, AgEagle benefits from enhanced brand-building, lower customer acquisition costs and increased reach, revenues and geographic and vertical market penetration.
Altum-PT also features a global shutter for distortion-free results, open APIs and a new storage device allowing for two captures per second. ● RedEdge-P – Offering three times the capture speed and twice the spatial resolution of the RedEdge-MX , the all new RedEdge-P, launched in early 2022, the sensor that builds on the legacy of the rugged, high-quality, multispectral sensor that the industry has come to trust and adds the power of a higher resolution, panchromatic band to double the output data resolution.
Altum-PT also features a global shutter for distortion-free results, open APIs and a new storage device allowing for two captures per second. 7 ● RedEdge-P – Offering three times the capture speed and twice the spatial resolution of the RedEdge-MX , the all new RedEdge-P, launched in early 2022, the sensor that builds on the legacy of the rugged, high-quality, multispectral sensor that the industry has come to trust and adds the power of a higher resolution, panchromatic band to double the output data resolution.
We believe that this will serve to advance our efforts to achieve deeper penetration of the government sector over the next five years. 15 ● We offer market-tested drones, sensors and software solutions that have earned the longstanding trust and fidelity of customers worldwide – through successful execution of our acquisition integration strategy in 2022, AgEagle is now delivering a unified line of industry trusted drones, sensors and software that have been vigorously tested and consistently proven across multiple industry verticals and use cases.
We believe that this will serve to advance our efforts to achieve deeper penetration of the government sector over the next five years. ● We offer market-tested drones, sensors and software solutions that have earned the longstanding trust and fidelity of customers worldwide – through successful execution of our acquisition integration strategy in 2022, AgEagle is now delivering a unified line of industry trusted drones, sensors and software that have been vigorously tested and consistently proven across multiple industry verticals and use cases.
In addition, we have championed the development of end-to-end software solutions which power autonomous flight and deliver actionable, contextual data and analytics for numerous Fortune 500 companies, government agencies and a wide range of businesses in agriculture, energy and utilities, construction and other industry sectors. ● Our eBee TAC UAS has been approved by the Defense Innovation Unit (DIU) for procurement by the Department of Defense – We believe that the eBee TAC is ideally positioned to become an in-demand, mission critical tool for the U.S. military, government and civil agencies and our allies worldwide; and expect that this will prove to be a major growth catalyst for our Company in 2022, positively impacting our financial performance in the years ahead. eBee TAC is available for purchase by U.S. government agencies and all branches of the military on GSA Schedule Contract #47QTCA18D003G, supplied by Hexagon US Federal and partner Tough Stump Technologies as a standalone solution or as part of the Aerial Reconnaissance Tactical Edge Mapping Imagery System (“ARTEMIS”).
In addition, we have championed the development of end-to-end software solutions which power autonomous flight and deliver actionable, contextual data and analytics for numerous Fortune 500 companies, government agencies and a wide range of businesses in agriculture, energy and utilities, construction and other industry sectors. 9 ● Our eBee TAC UAS has been approved by the Defense Innovation Unit (DIU) for procurement by the Department of Defense – We believe that the eBee TAC is ideally positioned to become an in-demand, mission critical tool for the U.S. military, government and civil agencies and our allies worldwide; and expect that this will prove to be a major growth catalyst for our Company positively impacting our financial performance in the years ahead. eBee TAC is available for purchase by U.S. government agencies and all branches of the military on GSA Schedule Contract #47QTCA18D003G, supplied by Hexagon US Federal and partner Tough Stump Technologies as a standalone solution or as part of the Aerial Reconnaissance Tactical Edge Mapping Imagery System (“ARTEMIS”).
Tough Stump is actively engaged in training military ground forces based in the U.S. and in Central Europe on the use of eBee TAC for mid-range tactical mapping and reconnaissance missions. ● Our eBee X series of fixed wing UAS, including the eBee X and eBee TAC , are the first and only drones on the market to comply with Category 3 of the sUAS Over People rules published by the FAA .
Tough Stump is actively engaged in training military ground forces based in the U.S. and in Central Europe on the use of eBee TAC for mid-range tactical mapping and reconnaissance missions. ● Our eBee X series of fixed wing UAS, including the eBee X and eBee TAC , are the first drones on the market to comply with Category 3 of the sUAS Over People rules published by the FAA .
In August 2016, the FAA’s final rules for routine use of certain small UAS in the U.S. National Airspace System went into effect, providing safety rules for small UAS (under 55 pounds) conducting non-recreational operations. These rules limit flights to visual-line-of-sight daylight operation, unless the UAS has anti-collision lights in which case twilight operation is permitted.
National Airspace System. 10 In August 2016, the FAA’s final rules for routine use of certain small UAS in the U.S. National Airspace System went into effect, providing safety rules for small UAS (under 55 pounds) conducting non-recreational operations. These rules limit flights to visual-line-of-sight daylight operation, unless the UAS has anti-collision lights in which case twilight operation is permitted.
The aggregate purchase price for the shares of Measure is $45 million, less the amount of Measure’s debt and transaction expenses, and subject to a customary working capital adjustment. Measure became a wholly-owned subsidiary of the Company as a result of the Measure Acquisition. On October 18, 2021 (the “senseFly S.A.
The aggregate purchase price for the shares of Measure is $45 million, less the amount of Measure’s debt and transaction expenses, and subject to a customary working capital adjustment. Measure became a wholly-owned subsidiary of the Company as a result of the Measure Acquisition. 12 On October 18, 2021 (the “senseFly S.A.
Our goal is to offer opportunities for employees to improve their skills to achieve their career goals. Employee Health and Safety We acted quickly to protect the health and safety of our employees in response to the pandemic protocols. In March 2020, all employees who could work remotely began working from home.
Our goal is to offer opportunities for employees to improve their skills to achieve their career goals. 13 Employee Health and Safety We acted quickly to protect the health and safety of our employees in response to the pandemic protocols. In March 2020, all employees who could work remotely began working from home.
Camera options include RGB, multispectral and thermal payloads; and the system can also be upgraded to include additional features and payloads. ● In March 2022, AgEagle’s eBee TAC™ Unmanned Aerial System was the first approved drone to be added to the U.S. Department of Defense’s (“DoD”) Defense Innovation Unit’s (“DIU”) Blue UAS Cleared List as part of Blue sUAS 2.0.
Camera options include RGB, multispectral and thermal payloads; and the system can also be upgraded to include additional features and payloads. In March 2022, AgEagle’s eBee TAC™ Uncrewed Aerial System was the first approved drone to be added to the U.S. Department of Defense’s (“DoD”) Defense Innovation Unit’s (“DIU”) Blue UAS Cleared List as part of Blue sUAS 2.0.
Today, the Company is earning distinction as a globally respected market leader offering customer-centric, advanced, autonomous unmanned aerial systems (“UAS”) which drive revenue at the intersection of flight hardware, sensors and software for industries that include agriculture, military/defense, public safety, surveying/mapping and utilities/engineering, among others.
Today, the Company is earning distinction as a globally respected market leader offering customer-centric, advanced, autonomous uncrewed aerial systems (“UAS”) which drive revenue at the intersection of flight hardware, sensors and software for industries that include military/defense, public safety, surveying/mapping, agriculture, and utilities/engineering, among others.
On October 27, 2022, AgEagle announced that the Company’s eBee X series of fixed wing UAS were the first and only drones on the market at that time to comply with Category 3 (as defined below) of the Operations of Small Unmanned Aerial Systems Over People rules published by the FAA.
On October 27, 2022, AgEagle announced that the Company’s eBee X series of fixed wing UAS were the first and only drones on the market at that time to comply with Category 3 (as defined below) of the Operations of Small Uncrewed Aerial Systems Over People rules published by the FAA.
Government Regulation UAV Regulation AgEagle is subject to industry-specific regulations due to the nature of the products we sell to our customers. For example, certain aspects of our U.S. business are subject to regulation by the Federal Aviation Administration (“FAA”), which regulates airspace for all air vehicles in the U.S. National Airspace System.
Government Regulation UAV Regulation AgEagle is subject to industry-specific regulations due to the nature of the products we sell to our customers. For example, certain aspects of our U.S. business are subject to regulation by the Federal Aviation Administration (“FAA”), which regulates airspace for all air vehicles in the U.S.
On the same day, the final rule for operation of small UAS over people also went into effect. This rule permits routine operations of small unmanned aircraft over people, moving vehicles and at night under certain conditions, provided that the operation meets the requirements of one of four operational categories.
On the same day, the final rule for operation of small UAS over people also went into effect. This rule permits routine operations of small uncrewed aircraft over people, moving vehicles and at night under certain conditions, provided that the operation meets the requirements of one of four operational categories.
Purchase Agreement”) The aggregate purchase price for the shares of senseFly S.A. is $21,000,000, less the amount of senseFly S.A.’s debt and subject to a customary working capital adjustment. senseFly S.A. became a wholly-owned subsidiary of the Company as a result. On October 18, 2021 (the “senseFly Inc.
Purchase Agreement”) The aggregate purchase price for the shares of senseFly S.A. is $21 million, less the amount of senseFly S.A.’s debt and subject to a customary working capital adjustment. senseFly S.A. became a wholly-owned subsidiary of the Company as a result. On October 18, 2021 (the “senseFly Inc.
AgEagle’s success with Blue sUAS 2.0 follows eBee ’s use as an integral asset for both conventional and unconventional Department of Defense units for over five years. ● eBee X – the eBee X has been recognized as the fixed-wing drone that revolutionized the unmanned aerial vehicle sector with its ease-of-use and multiple, state-of-the-art sensors designed to suit a wide range of mapping jobs.
AgEagle’s success with Blue sUAS 2.0 follows eBee ’s use as an integral asset for both conventional and unconventional Department of Defense units for over five years. 5 ● eBee X – the eBee X has been recognized as the fixed-wing drone that revolutionized the uncrewed aerial vehicle sector with its ease-of-use and multiple, state-of-the-art sensors designed to suit a wide range of mapping jobs.
Sensor Solutions Setting entirely new standards of excellence for high resolution aerial imaging solutions, our proprietary thermal and multispectral sensors are broadly recognized as the cameras of choice worldwide for advanced applications in agriculture, plant research, land management and forestry management. ● Altum-PT – an optimized three-in-one solution for advanced remote sensing and agricultural research.
Multi Spectral Cameras Setting entirely new standards of excellence for high resolution aerial imaging solutions, our proprietary thermal and multispectral sensors are broadly recognized as the cameras of choice worldwide for advanced applications in agriculture, plant research, land management and forestry management. ● Altum-PT – an optimized three-in-one solution for advanced remote sensing and agricultural research.
ITEM 1. BUSINESS Overview AgEagle ™ Aerial Systems Inc. (“AgEagle” or the “Company”), through its wholly owned subsidiaries, is actively engaged in designing and delivering best-in-class drones, sensors and software that solve important problems for our customers.
ITEM 1. BUSINESS Overview AgEagle ™ Aerial Systems Inc. (“AgEagle” or the “Company”, “we”, “our” or “us”), through its wholly owned subsidiaries, is actively engaged in designing and delivering best-in-class drones, sensors and software that solve important problems for our customers.
We may continue to experience potential supply chain disruptions in 2024 for the same reason.
We may continue to experience potential supply chain disruptions in 2025 for the same reason.
AgEagle believes that these measures to ban China-manufactured drones and components has fueled and will continue to fuel, demand for “Made in America” drones and components, creating a significant opportunity for U.S.-based drone manufacturers, like AgEagle.
AgEagle believes that these measures to ban China-manufactured drones and components not only protects our nation, but has fueled and will continue to fuel, demand for “Made in America” drones and components, creating a significant opportunity for U.S.-based drone manufacturers, like AgEagle.
The small size, lightweight, ease-of-use, autonomy, range and sensor capabilities make it a promising drone for tactical ISR missions.” As a result of the tests, European military units have ordered multiple eBee VISION prototypes, with delivery having occurred in late 2023. Commercial production of eBee VISION is planned for worldwide availability in early-2024 worldwide.
The small size, lightweight, ease-of-use, autonomy, range and sensor capabilities make it a promising drone for tactical ISR missions.” As a result of the tests, European military units ordered multiple eBee VISION prototypes, with delivery having occurred in late 2023.
Scheduled for global commercial release during the first quarter of 2024, the eBee VISION delivers high resolution, medium-range video imagery made possible by its 32x zoom and powerful thermal observation capabilities. Its sensor payloads are capable of detecting, tracking and geo-locating objects in both day and night conditions.
The eBee VISION delivers high resolution, medium-range video imagery made possible by its 32x zoom and powerful thermal observation capabilities. Its sensor payloads are capable of detecting, tracking and geo-locating objects in both day and night conditions.
With the integration of our 2021 acquisitions completed in 2021 (the “2021 Acquisitions”), we can now leverage our collective reseller network to accelerate our revenue growth by educating and encouraging our partners to market AgEagle’s full suite of airframes, sensors and software as bundled solutions in lieu of marketing only previously siloed products or product lines to end users.
We leverage our collective reseller network to accelerate our revenue growth by educating and encouraging our partners to market AgEagle’s full suite of airframes, sensors and software as bundled solutions in lieu of marketing only previously siloed products or product lines to end users.
Patent Date REFLECTANCE PANELS FEATURING MACHINE-READABLE SYMBOL AND METHODS OF USE US NP-Filed 62/160732 5/13/15 REFLECTANCE PANELS FEATURING MACHINE-READABLE SYMBOL AND METHODS OF USE US Granted 15/154719 5/13/16 20170352110 12/7/17 10467711 11/5/19 THERMAL CALIBRATION OF AN INFRARED IMAGE SENSOR US Granted 15/620627 6/12/17 20170358105 12/14/17 10518900 12/31/19 THERMAL CALIBRATION OF AN INFRARED IMAGE SENSOR US NP-Filed 62/350116 6/14/16 MULTI-SENSOR IRRADIANCE ESTIMATION PCT Converted US2017/066524 12/14/17 WO2018/136175 7/26/18 MULTI-SENSOR IRRADIANCE ESTIMATION US Granted 16/037952 7/17/18 20180343367 11/29/18 11290623 3/29/22 MULTI-SENSOR IRRADIANCE ESTIMATION China Published 201780083888.1 12/14/17 CN110291368A 9/27/19 MULTI-SENSOR IRRADIANCE ESTIMATION Europe Published 17892899.0 12/14/17 3571480 11/27/19 MULTI-SENSOR IRRADIANCE ESTIMATION Japan Published 2019-529189 12/14/17 2020-515809 5/28/20 IMAGE SENSOR AND THERMAL CAMERA DEVICE, SYSTEM AND METHOD Europe Published 19892185.0 12/3/19 3890466 10/13/21 22 IMAGE SENSOR AND THERMAL CAMERA DEVICE, SYSTEM AND METHOD China Allowed 201980079714.7 12/3/19 CN113226007A 8/6/21 IMAGE SENSOR AND THERMAL CAMERA DEVICE, SYSTEM AND METHOD US Published 17 /299258 6/2/21 20220038644 2/3/22 IMAGE SENSOR AND THERMAL CAMERA DEVICE, SYSTEM AND METHOD PCT Converted US2019/064296 12/3/19 WO2020/117847 6/11/20 DIFFUSER FOR IRRADIANCE SENSOR US Published 17 /720093 4/13/22 20220333979 10/20/22 DIFFUSER FOR LIGHT SENSOR US NP-Filed 63 /174929 4/14/21 AERIAL IMAGING SYSTEM AND METHOD HAVING MULTISPECTRAL AND PANCHROMATIC SENSORS PCT Pending US2022/075938 9/2/22 AERIAL IMAGING SYSTEM AND METHOD HAVING MULTISPECTRAL AND PANCHROMATIC SENSORS US NP-Filed 63/240730 9/3/21 CAMERA US Granted 29/691510 5/16/19 D907099 1/5/21 CAMERA US Granted 29/691512 5/16/19 D907100 1/5/21 LIGHT SENSOR US Granted 29/691513 5/16/19 D906845 1/5/21 LENS HOUSING US Granted 29/691516 5/16/19 D907102 1/5/21 Where You Can Find Additional Information The Company is subject to the reporting requirements under the Exchange Act.
Patent Date REFLECTANCE PANELS FEATURING MACHINE-READABLE SYMBOL AND METHODS OF USE US NP-Filed 62/160732 5/13/15 REFLECTANCE PANELS FEATURING MACHINE-READABLE SYMBOL AND METHODS OF USE US Granted 15/154719 5/13/16 20170352110 12/7/17 10467711 11/5/19 THERMAL CALIBRATION OF AN INFRARED IMAGE SENSOR US Granted 15/620627 6/12/17 20170358105 12/14/17 10518900 12/31/19 THERMAL CALIBRATION OF AN INFRARED IMAGE SENSOR US NP-Filed 62/350116 6/14/16 MULTI-SENSOR IRRADIANCE ESTIMATION PCT Converted US2017/066524 12/14/17 WO2018/136175 7/26/18 MULTI-SENSOR IRRADIANCE ESTIMATION US Granted 16/037952 7/17/18 20180343367 11/29/18 11290623 3/29/22 MULTI-SENSOR IRRADIANCE ESTIMATION China Published 201780083888.1 12/14/17 CN110291368A 9/27/19 AERIAL VEHICLE COMPRISING IRRADIANCE SENSOR AND IMAGING DEVICE Europe Converted 17892899.0 12/14/17 3571480 11/27/19 3571480 12/11/24 MULTI-SENSOR IRRADIANCE ESTIMATION Austria Belgium Switzerland/Lichtenstein Germany Denmark Spain Finland France United Kingdom Netherlands Norway Sweden Japan Granted 2019-529189 12/14/17 2020-515809 5/28/20 7321093 7/27/2023 IMAGE SENSOR AND THERMAL CAMERA DEVICE, SYSTEM AND METHOD Europe Published 19892185.0 12/3/19 3890466 10/13/21 IMAGE SENSOR AND THERMAL CAMERA DEVICE, SYSTEM AND METHOD China Granted 201980079714.7 12/3/19 CN113226007A 8/6/21 ZL201980079714.7 4/14/2023 IMAGE SENSOR AND THERMAL CAMERA DEVICE, SYSTEM AND METHOD US Granted 17 /299258 6/2/21 20220038644 2/3/22 12028588 7/2/2024 IMAGE SENSOR AND THERMAL CAMERA DEVICE, SYSTEM AND METHOD PCT Converted US2019/064296 12/3/19 WO2020/117847 6/11/20 IMAGE SENSOR AND THERMAL CAMERA DEVICE, SYSTEM AND METHOD US Allowed 18/744539 6/14/24 2019064296 12/3/19 DIFFUSER FOR IRRADIANCE SENSOR INCLUDING DIFFUSER PROTRUDING FROM EXTERIOR SURFACE US Granted 17 /720093 4/13/22 20220333979 10/20/22 12055434 8/6/2024 DIFFUSER FOR LIGHT SENSOR US NP-Filed 63 /174929 4/14/21 CAMERA US Granted 29/691510 5/16/19 D907099 1/5/21 CAMERA US Granted 29/691512 5/16/19 D907100 1/5/21 LIGHT SENSOR US Granted 29/691513 5/16/19 D906845 1/5/21 LENS HOUSING US Granted 29/691516 5/16/19 D907102 1/5/21 16 Where You Can Find Additional Information The Company is subject to the reporting requirements under the Exchange Act.
While environmental protection regulations have not had a significant adverse effect on our overall operations historically, it is reasonably possible that costs incurred to ensure continued environmental compliance in the future could have a material impact on our results of operations, financial condition or cash flows if additional work requirements or more stringent clean-up standards are imposed by regulators, or if new areas of soil, air and groundwater contamination are discovered and/or expansions of work scope are prompted by the results of investigations.
While environmental protection regulations have not had a significant adverse effect on our overall operations historically, it is reasonably possible that costs incurred to ensure continued environmental compliance in the future could have a material impact on our results of operations, financial condition or cash flows if additional work requirements or more stringent clean-up standards are imposed by regulators, or if new areas of soil, air and groundwater contamination are discovered and/or expansions of work scope are prompted by the results of investigations. 11 Suppliers In 2024, we maintained strong relationships established with companies that provide many of the parts and services necessary to construct our advanced fixed-wing drones and sensors.
Operating Segment Revenues The table below reflects our revenue by operating segment for the years indicated below: For the Year Ended December 31, Type 2023 2022 Drones $ 6,197,049 $ 9,840,321 Sensors 7,100,419 8,655,434 Software-as-a-Service (SaaS) 443,930 598,670 Total $ 13,741,398 $ 19,094,425 18 Research and Development Research and development activities are core components of our business, and we follow a disciplined approach to investing our resources to create new drone technologies and solutions.
Operating Segment Revenues The table below reflects our revenue by operating segment for the years indicated below: For the Year Ended December 31, Type 2024 2023 Drones $ 6,410,305 $ 6,197,049 Sensors 6,663,196 7,100,419 Software-as-a-Service (SaaS) 319,276 443,930 Total $ 13,392,777 $ 13,741,398 Research and Development Research and development activities are core components of our business, and we follow a disciplined approach to investing our resources to create new drone technologies and solutions.
Chamber of Commerce, National League of Cities, National Council of State Legislatures, American Association of State Highway and Transportation Officials, Commercial Drone Alliance and Association of Unmanned Vehicle Systems International among others. This bill is currently pending approval by the U.S.
Chamber of Commerce, National League of Cities, National Council of State Legislatures, American Association of State Highway and Transportation Officials, Commercial Drone Alliance and Association of Uncrewed Vehicle Systems International among others. This bill is currently pending approval by the U.S. Senate. The Military Drone Market is expected to see substantial growth in the coming years.
Intellectual Property As reflected in the table below, we currently have registered trademarks, several patents or pending patents for our proprietary drone, sensor and software technologies filed in the United States and certain jurisdictions abroad.
Intellectual Property As reflected in the table below, we currently have registered trademarks, several patents or pending patents for our proprietary drone, sensor and software technologies filed in the United States and certain jurisdictions abroad. As of December 31, 2024, our trademark portfolio includes registered and/or pending in various countries and patents in various stages of the patent granting process.
In December 2022, we unveiled our new eBee™ VISION , a small, fixed-wing UAS designed to provide real-time, enhanced situational awareness for critical intelligence, surveillance and reconnaissance missions; and in April 2023, were awarded a federal contract from the U.S.
Since launching our eBee ™ VISION, a small, fixed-wing UAS designed to provide real-time, enhanced situational awareness for critical intelligence, surveillance and reconnaissance missions , we have been awarded a contract from the U.S.
We acknowledge that our employees are the Company’s most valued asset and the driving force behind our success. For this reason, we aspire to be an employer that is known for cultivating a positive and welcoming work environment and one that fosters growth, provides a safe place to work, supports diversity and embraces inclusion.
For this reason, we aspire to be an employer that is known for cultivating a positive and welcoming work environment and one that fosters growth, provides a safe place to work, supports diversity and embraces inclusion.
AgEagle’s commitment to its discerning customers has driven its efforts to establish recognized centers of excellence in drone airframes, sensors and software, which, in turn, has resulted in the Company’s drone production operations receiving official ISO:9001 certification for its Quality Management System (“QMS”) in 2022.
AgEagle’s commitment to its discerning customers has driven its efforts to establish recognized centers of excellence in drone airframes, sensors and software, which, in turn, has driven the the Company’s drone production and distribution operations to actively seek ISO:9001 certification for its Quality Management System (“QMS”), a process that the Company expects to complete within the second quarter of 2025.
In 2022, the Company successfully integrated all three acquired companies with AgEagle to form one global company focused on taking autonomous flight performance to a higher level. 4 Our core technological capabilities include robotics and robotics systems autonomy; advanced thermal and multispectral sensor design and development; embedded software and firmware; secure wireless digital communications and networks; lightweight airframes; small UAS (“sUAS”) design, integration and operations; power electronics and propulsion systems; controls and systems integration; fixed wing flight; flight management software; data capture and analytics; human-machine interface development and integrated mission solutions.
Our core technological capabilities include robotics and robotics systems autonomy; advanced thermal and multispectral sensor design and development; embedded software and firmware; secure wireless digital communications and networks; lightweight airframes; small UAS (“sUAS”) design, integration and operations; power electronics and propulsion systems; controls and systems integration; fixed wing flight; flight management software; data capture and analytics; human-machine interface development and integrated mission solutions.
As a result, we have earned ISO:9001 international certification for our Quality Management System. ● AgEagle is more than just customer- and product-centric, we are obsessed with innovation and knowing the needs of our customers before they do – We are focused on capitalizing on our specialized expertise in innovating and commercializing advanced drone, sensor and software technologies to provide our existing and future customers with autonomous robotic solutions that meet the highest possible safety and operational standards and fit their specific business needs.
In addition, AgEagle is committed to meeting and exceeding quality and safety standards for manufacturing, assembly, design and engineering and testing of drones, drone subcomponents and related drone equipment in our U.S. and Swiss-based manufacturing operations. ● AgEagle is more than just customer- and product-centric, we are obsessed with innovation and knowing the needs of our customers before they do – We are focused on capitalizing on our specialized expertise in innovating and commercializing advanced drone, sensor and software technologies to provide our existing and future customers with autonomous robotic solutions that meet the highest possible safety and operational standards and fit their specific business needs.
Strategic Acquisitions in 2021(the “2021 Acquisitions”) MicaSense ™ , Inc. In January 2021, AgEagle acquired MicaSense™, Inc. (“MicaSense”), a company that has been at the forefront of advanced drone sensor development since its founding in 2014.
(“MicaSense”), a company that has been at the forefront of advanced drone sensor development since its founding in 2014.
AgEagle’s Manufacturing Operations For years, federal agencies have been using drones for a wide range of use cases, from mapping to surveillance, search and rescue, and scientific research. However, in recent years federal agencies’ use of and ability to procure UAS has evolved, largely stemming from security concerns about drones from Chinese manufacturers. In 2020, for example, the U.S.
However, in recent years federal agencies’ use of and ability to procure UAS has evolved, largely stemming from security concerns about drones from Chinese manufacturers. In 2020, for example, the U.S.
On June 21, 2022, the Company announced that the eBee X was the first drone in its class to receive design verification essential for BVLOS and OOP from the European Union Aviation Safety Agency, enabling drone operations to seek Specific Operations Risk Assessment (“SORA”) authorization to fly BVLOS and OOP with eBee X in 27 European Union member states, as well as Iceland, Lichtenstein, Norway and Switzerland. 7 In October 2022, the eBee X series of fixed wing unmanned aircraft systems, including the eBee X , eBee Geo and eBee TAC , were the first and only drones on the market to comply with Category 3 of the Operations of Small Unmanned Aircraft Systems Over People rules published in the Federal Registry by the FAA in March 2021.
On June 21, 2022, the Company announced that the eBee X was the first drone in its class to receive design verification essential for BVLOS and OOP from the European Union Aviation Safety Agency, enabling drone operations to seek Specific Operations Risk Assessment (“SORA”) authorization to fly BVLOS and OOP with eBee X in 27 European Union member states, as well as Iceland, Lichtenstein, Norway and Switzerland.
Safe, ultra-light and easy to use, these autonomous drones are utilized by thousands of customers around the world in agriculture, government/defense, engineering, and construction, among other industry verticals, to collect actionable aerial data intelligence. 5 2022 Integration Activities In 2022, the Company built an enterprise architecture designed to seamlessly integrate the acquisitions completed in 2021, thereby unifying four disparate brands under one global brand: AgEagle.
Safe, ultra-light and easy to use, these autonomous drones are utilized by thousands of customers around the world in agriculture, government/defense, engineering, and construction, among other industry verticals, to collect actionable aerial data intelligence.
Moreover, with every new innovation in sensor technologies, the functionality and the underpinning value proposition of commercial UAS continues to improve and allows for an even wider range of possible applications.
Moreover, with every new innovation in sensor technologies, the functionality and the underpinning value proposition of commercial UAS continues to improve and allows for an even wider range of possible applications. AgEagle’s Manufacturing Operations For years, federal agencies have been using drones for a wide range of use cases, from mapping to surveillance, search and rescue, and scientific research.
The aggregate purchase price for the shares of senseFly Inc. is $2 million , less the amount of senseFly Inc.’s debt and subject to a customary working capital adjustment. senseFly Inc. became a wholly-owned subsidiary of the Company as a result. 19 Our Headquarters Our principal executive offices are located at 8201 E. 34 th Street North, Suite 1307, Wichita, Kansas 67226 and our telephone number is 620-325-6363.
The aggregate purchase price for the shares of senseFly Inc. is $2 million , less the amount of senseFly Inc.’s debt and subject to a customary working capital adjustment. senseFly Inc. became a wholly-owned subsidiary of the Company as a result.
Its coastal blue band – the first of its kind in the market – was specifically designed for vegetation analysis of water bodies; environmental monitoring; water management; habitat monitoring, protection and restoration; and vegetation species and weeds identification, including differentiating and counting plants, trees, invasive species and weeds.
Its coastal blue band – the first of its kind in the market – was specifically designed for vegetation analysis of water bodies; environmental monitoring; water management; habitat monitoring, protection and restoration; and vegetation species and weeds identification, including differentiating and counting plants, trees, invasive species and weeds. ● AgEagle was awarded a Multiple Award Schedule (“MAS”) Contract by the U.S. federal government’s General Services Administration (“GSA”) – In April 2023, the centralized procurement arm of the federal government, the GSA, awarded us with a five-year MAS contract.
Additional demonstrations with other military forces in the United States and NATO countries are being scheduled for the first quarter of 2024. Market Opportunity for UAVs Drones have transformed from being freelance videographer toys to mission critical inspection tools for enterprise businesses like construction, energy and agriculture, and for military/defense applications worldwide.
Commercial production of eBee VISION began shortly thereafter, with successful deliveries to a number of global military forces. 6 Market Opportunity for UAVs Drones have transformed from being freelance videographer toys to mission critical inspection tools for enterprise businesses like construction, energy and agriculture, and for military/defense applications worldwide.
This major milestone was achieved by AgEagle following months of work, historic reliability review and extensive testing conducted by Virginia Tech Mid-Atlantic Aviation Partnership (“MAAP”).
This major milestone was achieved by AgEagle following months of work, historic reliability review and extensive testing conducted by Virginia Tech Mid-Atlantic Aviation Partnership (“MAAP”). ● eBee VISION – in December 2022, AgEagle announced its latest innovation in commercial and tactical drone technology with the unveiling of its new eBee VISION Intelligence, Surveillance and Reconnaissance (“ISR”) UAS .
Our website address is www.ageagle.com. The information contained on, or that can be accessed through, our website is not a part of this Annual Report. We have included our website address in this Annual Report solely as an inactive textual reference. Human Capital Resources As of March 31, 2024, we employed 64 full-time employees and 2 part-time employees.
We have included our website address in this Annual Report solely as an inactive textual reference. Human Capital Resources As of March 31, 2025, we employed 50 full-time employees and 2 part-time employees. We acknowledge that our employees are the Company’s most valued asset and the driving force behind our success.
Our Branded Line of Unmanned Aerial Vehicles eBee ™ Line of Professional Drones Sold worldwide through AgEagle’s direct sales team and global network of trusted resellers, the Company’s eBee line of commercial and government/military UAS have logged more than 500,000 flight hours on more than one million successful missions over the past decade.
Our Branded Line of Uncrewed Aerial Vehicles eBee ™ Line of Professional Drones Sold worldwide through AgEagle’s direct sales team and global network of trusted resellers, the Company’s eBee line of commercial and government/military UAS have logged more than 500,000 flight hours on more than one million successful missions over the past decade. ● eBee TAC ™ – Designed specifically for government and military mapping and mission planning applications, the eBee TAC operates in disconnected environments, providing a higher accuracy mobile solution to map and locally share aerial imagery data on rapidly changing field conditions to analyze and provide near real-time situational awareness to ground forces.
Offered as Software-as-a-Service (“SaaS”), Ground Control is a cloud-based, plug-and-play operating system that empowers pilots and large enterprises with everything they need to operate drone fleets, fly autonomously, collaborate globally, visualize data, and integrate with existing business systems and processes. Ground Control serves a world class customer base, including many Fortune 500 companies.
Measure offered a Software-as-a-Service (“SaaS”) product known as “ Ground Control” as a cloud-based, plug-and-play operating system that enabled pilots and large enterprises to operate drone fleets, fly autonomously, collaborate globally, visualize data, and integrate with existing business systems and processes. Measure ceased operations on December 31, 2024. senseFly ™ , S.A. and SenseFly Inc.
With RedEdge-P , agricultural professionals benefit from a sensor that can enable effective plant counting and spectral analysis of small plants. Likewise, federal, state and local government and commercial forestry enterprises will also benefit from precise, efficient data collection and tree-level analysis as opposed to being limited to analyzing large swaths of land to make critical forestry management decisions.
Likewise, federal, state and local government and commercial forestry enterprises will also benefit from precise, efficient data collection and tree-level analysis as opposed to being limited to analyzing large swaths of land to make critical forestry management decisions. ● RedEdge-Pdual – A further specialized product, the RedEdge-Pdual offers a combined solution of the RedEdge-P and RedEdge-P blue cameras, this camera provides specialized insight into plant classification, weed identification, environmental research and vegetation analysis of water bodies, adding a coastal blue band.
Suppliers In 2023, we maintained strong relationships established with companies that provide many of the parts and services necessary to construct our advanced fixed-wing drones and sensors. As our Company grows, we expect to pursue additional supplier relationships from which we can source less costly and better supplies to stay ahead of the needs of the market.
As our Company grows, we expect to pursue additional supplier relationships from which we can source less costly and better supplies to stay ahead of the needs of the market. In addition, we have forged strong relationships with key suppliers in the U.S. and in U.S.-allied countries based on their ability to meet our needs and delivery timelines.
The Company files with, or furnishes to, the SEC quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports and will furnish its proxy statement. These filings are available free of charge on the Company’s website, wwwageagle.com, shortly after they are filed with, or furnished to, the SEC.
The Company files with, or furnishes to, the Securities and Exchange Commission (“SEC”) annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports and other filings with the SEC.
Ensuring the security of data transmission and control systems has been and continue to be critical in preventing unauthorized access and misuse. The Company is currently headquartered in Wichita, Kansas, where we house our sensor manufacturing operations, and we operate our business and drone manufacturing in Raleigh, North Carolina and Lausanne, Switzerland which supports our international business activities.
Ensuring the security of data transmission and control systems has been and continue to be critical in preventing unauthorized access and misuse.
The SEC maintains an Internet website, www.sec.gov, which contains reports and information statements and other information regarding issuers. 23
These filings are available free of charge on the Company’s website, www.ageagle.com, as soon as reasonably practicable after they are filed with, or furnished to, the SEC. The SEC maintains an Internet website, www.sec.gov, which contains reports and information statements and other information regarding issuers.
Our non-U.S. operations are subject to the laws and regulations of foreign jurisdictions, which may include regulations that are more stringent than those imposed by the U.S. government on our U.S. operations. 17 Domestic Hemp Production and Prevailing Regulatory Changes With the passing of the 2018 Farm Bill in December 2018, industrial hemp is now recognized as an agricultural commodity, such as corn, wheat, or soybeans.
Category 3 aircraft also require FAA-accepted means of compliance and FAA-accepted declaration of compliance. Our non-U.S. operations are subject to the laws and regulations of foreign jurisdictions, which may include regulations that are more stringent than those imposed by the U.S. government on our U.S. operations.
In addition, we have forged strong relationships with key suppliers in the U.S. and in U.S.-allied countries based on their ability to meet our needs and delivery timelines. We will continue to expand upon our suppliers’ expertise to improve our existing products and develop new solutions.
We will continue to expand upon our suppliers’ expertise to improve our existing products and develop new solutions.
We believe that by investing in complementary acquisitions, we can accelerate our revenue growth and deliver a broader array of innovative autonomous flight systems and solutions that address specialized market needs within our current target markets and in emerging markets that can benefit from innovations in artificial intelligence-enabled robotics and data capture and analytics. 14 Competitive Strengths AgEagle believes the following attributes and capabilities provide us with long-term competitive advantages: ● Proprietary technologies, in-house capabilities and industry experience – We believe our decade of experience in commercial UAS design and engineering; in-house manufacturing, assembly and testing capabilities; and advanced technology development skillset serve to differentiate AgEagle in the marketplace.
An international certification, ISO:9001 recognizes organizational excellence and good quality practices based on a strong customer focus, robust process approach and proof of continual improvement. 8 Competitive Strengths AgEagle believes the following attributes and capabilities provide us with long-term competitive advantages: ● Proprietary technologies, in-house capabilities and industry experience – We believe our decade of experience in commercial UAS design and engineering; in-house manufacturing, assembly and testing capabilities; and advanced technology development skillset serve to differentiate AgEagle in the marketplace.
Meeting a wide variety of strict standards, AgEagle has demonstrated that it delivers consistently high-quality products and services in every aspect of its fixed-wing drone operations, including design, manufacturing, marketing, sales and after-sales. An international certification, ISO:9001 recognizes organizational excellence and good quality practices based on a strong customer focus, robust process approach and proof of continual improvement.
Demonstrating that the Company delivers consistently high-quality products and services in every aspect of its fixed-wing drone operations, including design, manufacturing, marketing, sales and after-sales.
In a July 2022 report published by Allied Market Research, the firm’s market analysts reported that the global drone software market was valued at $5.96 billion in 2021, and is now projected to reach $21.93 billion by 2031, growing at a CAGR of 14.5% from 2022 to 2031. 12 Market Opportunity for U.S.
A recent report from Straits Research said that the global military drone market size was valued at USD 21.81 billion in 2024 and is expected to grow from USD 24.25 billion in 2025 to reach USD 56.69 billion by 2033, growing at a CAGR of 11.20% during the forecast period (2025-2033).
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Serving a world class customer base, Measure enables its customers to realize the transformative benefits of drone technology through its Ground Control solution.
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In 2022, the Company successfully integrated all three acquired companies with AgEagle to form one global company focused on taking autonomous flight performance to a higher level.
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By adding Measure’s advanced software to the AgEagle platform, combined with its sensors and other data capture and analytics innovations, our customers can capitalize on the significant economic, safety and efficiency benefits made possible by drones used at scale. senseFly ™ , S.A. In October 2021, the Company acquired senseFly, S.A. and senseFly Inc.
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The Company is currently headquartered in Wichita, Kansas, where we house our sensor manufacturing operations, and we manufacture drones in Lausanne, Switzerland. 4 Product Lines senseFly ™ , S.A. – Uncrewed Aerial Vehicles In October 2021, the Company acquired senseFly, S.A. and senseFly Inc.
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As part of this process, AgEagle executed an action plan to create long-term sustainable value through the efficiencies derived from economies of scale, sharing and optimizing resources – in particular, human capital and knowledge – and combining assets.
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Safe, ultra-light and easy to use, these autonomous drones are utilized by thousands of customers around the world in agriculture, government/defense, engineering, and construction, among other industry verticals, to collect actionable aerial data intelligence. MicaSense ™ , Inc. – Multi Spectral Cameras In January 2021, AgEagle acquired MicaSense™, Inc.
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Critical to the success of the integration and integral to the Company’s ability to stay disciplined, structurally organized and rooted in its core values was: ● implementation of a new enterprise resource planning (“ERP”) system and ongoing optimization will be in process through 2024; ● collapse of all acquired websites and the creation and launch of one website, found at www.ageagle.com, showcasing the Company’s full suite of products and capabilities and was completed in 2023; ● creation of an Intranet employee portal to support and promote enterprise-wide communication and connectivity and was completed in 2023; ● consolidation of the Company’s business and manufacturing operations in the United States from multiple offices spread across the country in Kansas, North Carolina, Texas, Washington and Washington, D.C. to three centralized locations in Wichita, Kansas, Raleigh, North Carolina and Lausanne, Switzerland – an initiative which commenced in late 2022 and was completed in 2023; ● commitment to on-going customer-centric product development roadmaps designed to best leverage the right combination of process, tools, training and project management to effectively meet product enhancement and new product launch deadlines and achieve post-launch sales and marketing key performance indicators; and ● shifts in the responsibilities of senior and mid-level management to optimize strengths and squarely align functional and cross-functional goals and objectives, which we monitor continually as an ongoing initiative.
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In October 2021, the Company acquired senseFly, S.A. and senseFly Inc. (collectively “senseFly”), a global leader in fixed-wing drones that simplify the collection and analysis of geospatial data, allowing professionals to make better and faster decisions.
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Moreover, according to AgEagle’s analysis of official FAA Part 107 commercial drone registration data supplied to the Company pursuant to a Freedom of Information Act Request submission, from 2016 through 2021, the eBee was the commercial sUAS of choice for U.S. commercial drone operators, outnumbering all other fixed wing drones registered, including Vertical Take-Off and Landing (“VTOL”) aircraft, accounting for 41% of all commercial fixed-wing drone registrations in the United States. ● eBee Ag – a reliable, affordable drone solution to help farmers, agronomists and service providers map and monitor crops quickly and easily.
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Founded in 2009, senseFly develops and produces a proprietary line of eBee™ -branded, high performance, fixed-wing drones which have flown more than one million flights around the world.
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The eBee Ag and its drone sensor deliver timely plant health insights with accuracy and efficiency that complements precision agriculture workflows. With its dual-purpose Duet M camera, eBee Ag captures accurate RGB and multispectral data from the sky to help users make better decisions on the ground. eBee Ag also features available Real-Time Kinematic (“RTK”) functionality for greater mapping precision.
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In October 2022, the eBee X series of fixed wing uncrewed aircraft systems, including the eBee X , eBee Geo and eBee TAC , were the first and only drones on the market to comply with Category 3 of the Operations of Small Uncrewed Aircraft Systems Over People rules published in the Federal Registry by the FAA in March 2021.
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With its available RTK, the agriculture drone can achieve absolute accuracy down to 2.5 cm (1.0 inch) with its RGB camera. Highly-accurate vegetative index maps allow users to understand every acre while managing problematic areas field-wide – before they impact profits. Equipped with its standard battery, eBee Ag is capable of up to 45-minutes of flight.
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The report said: “A military drone, also known as an uncrewed aerial vehicle (UAV), is a type of aircraft that operates without a human pilot on board. These drones are equipped with advanced technologies for surveillance, reconnaissance, intelligence gathering, and, in some cases, targeted strikes.
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An available endurance battery increases flight times up to 55 minutes — allowing the drone to cover more than 160 hectares (395 acres) in a single flight and save precious time and money when compared with conventional crop scouting. It was announced on February 14, 2024 that the eBee Ag was placed on end-of-life and unavailable for sale.
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Military drones are used extensively in modern warfare for a variety of roles, including combat, surveillance, logistical support, and search-and-rescue missions. The global market is experiencing rapid growth, driven by technological advancements and increasing global demand for enhanced surveillance, intelligence, and reconnaissance capabilities.
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Enhancements were made to the eBee X to use as a replacement for this product. 6 ● eBee Geo – an affordable fixed-wing mapping drone designed to meet the highest demands of surveyors, civil engineers and GIS professionals worldwide.
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As nations recognize the strategic advantages of uncrewed aerial systems (UAS) in military operations, drones are increasingly deployed in both combat and non-combat roles. This expansion is further supported by rising defense budgets, particularly in regions such as Asia-Pacific, Europe, and the Middle East.
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Built upon more than 10 years of drone mapping experience, eBee Geo is rugged, intuitive to operate and makes surveying and mapping small to large areas faster and more efficient than using terrestrial surveying equipment alone.
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Despite the promising growth, there are significant challenges facing the global market, including complex regulatory issues and ethical concerns surrounding the use of autonomous weapons.
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The data collected can quickly be processed into highly-accurate georeferenced orthomosaics, digital elevation models, digital surface models and high-density point clouds to bring additional value beyond common vectors.
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However, innovations in artificial intelligence (AI), miniaturization, and battery life are expected to open new growth opportunities, enabling more advanced, efficient, and versatile drone capabilities in the near future.” Straits Research continued: “Geopolitical tensions, especially in regions like Asia-Pacific, the Middle East, and Eastern Europe, are driving a significant demand for military drones.
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Designed to complement the user’s surveying toolkit , eBee Geo comes with everything needed to get started, including professional drone camera technology and eMotion , AgEagle’s flight planning software originally designed and developed by senseFly.
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As nations seek to strengthen their surveillance, intelligence, and tactical capabilities, military drones have become integral to modern defense strategies. For example, the Indo-Pacific region increasingly views drones as vital for maintaining a strategic balance in contested areas.
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With eBee Geo, a user can map up to 160 ha (395 ac) at 120 m (400 ft) with a maximum flight time of 45 minutes. eBee Geo is also available with RTK positioning. Combined with the Company’s purpose-built Sensor Optimized for Drone Applications (“S.O.D.A”) , users are assured of sharp, accurate mapping outputs – even in the harshest conditions.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThese broad market and industry factors could reduce the market price of our securities, regardless of our actual operating performance. We do not intend to pay cash dividends. As a result, capital appreciation, if any, will be your sole source of gain. We intend to retain future earnings, if any, to fund the development and growth of our business.
Biggest changeWe intend to retain future earnings, if any, to fund the development and growth of our business. In addition, the terms of existing and future debt agreements may preclude us from paying dividends. As a result, capital appreciation, if any, from the sale of our Common Stock will be your sole source of gain for the foreseeable future.
We have a history of operating losses and expect to incur significant additional operating expenses. Through our wholly-owned subsidiary, AgEagle Aerial, Inc., we have been operating for over ten years. It was not until 2021 that we acquired the latest go-to-market airframes, sensors and software technologies of our products.
We have a history of operating losses and expect to incur significant additional operating expenses. We have been operating through our wholly-owned subsidiary, AgEagle Aerial, Inc. for over ten years. It was not until 2021 that we acquired the latest go-to-market airframes, sensors and software technologies of our products.
Our securities may experience substantial volatility as a result of a number of factors, including, among others: ● sales or potential sales of substantial amounts of our Common Stock; ● potential stock splits; ● announcements about us or about our competitors or new product introductions; ● developments concerning our product manufacturers; ● the loss or unanticipated underperformance of our global distribution channel; ● litigation and other developments relating to our patents or other proprietary rights or those of our competitors; ● conditions in the UAV, domestic hemp cultivation and drone-enabled package delivery industries; ● governmental regulation and legislation; ● variations in our anticipated or actual operating results; ● changes in securities analysts’ estimates of our performance, or our failure to meet analysts’ expectations; ● foreign currency values and fluctuations; and ● overall political and economic conditions, including Russia’s invasion of Ukraine.
Our securities may experience substantial volatility as a result of a number of factors, including, among others: ● sales or potential sales of substantial amounts of our Common Stock; ● potential stock splits; ● announcements about us or about our competitors or new product introductions; ● developments concerning our product manufacturers; 29 ● the loss or unanticipated underperformance of our global distribution channel; ● litigation and other developments relating to our patents or other proprietary rights or those of our competitors; ● conditions in the UAV, domestic hemp cultivation and drone-enabled package delivery industries; ● governmental regulation and legislation; ● variations in our anticipated or actual operating results; ● changes in securities analysts’ estimates of our performance, or our failure to meet analysts’ expectations; ● foreign currency values and fluctuations; and ● overall political and economic conditions, including Russia’s invasion of Ukraine.
The challenges, risks and uncertainties frequently encountered by companies in rapidly evolving markets could impact our ability to do the following: ● Generate sufficient revenue to achieve sustainable profitability; ● Acquire and maintain market share; ● Achieve or manage growth in our business operations; ● Renew contracts; ● Attract and retain software and system engineers and other highly qualified personnel; ● Successfully develop for the commercial market new products and end-to-end solutions; ● Adapt to new or changing polices and spending priorities of current and prospective clients; and ● Access to additional capital when required and on reasonable terms.
The challenges, risks and uncertainties frequently encountered by companies in rapidly evolving markets could impact our ability to do the following: ● Generate sufficient revenue to achieve sustainable profitability; ● Acquire and maintain market share; ● Achieve or manage growth in our business operations; ● Renew contracts; ● Attract and retain software and system engineers and other highly qualified personnel; ● Successfully develop for the commercial market new products and end-to-end solutions; 20 ● Adapt to new or changing polices and spending priorities of current and prospective clients; and ● Access to additional capital when required and on reasonable terms.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our officers, directors or control persons, the SEC has advised that such indemnification is against public policy and is therefore unenforceable. 34 Risks Associated with Our Securities Our executive officers and directors may sell shares of their stock, and these sales could adversely affect our stock price.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our officers, directors or control persons, the SEC has advised that such indemnification is against public policy and is therefore unenforceable. Risks Associated with Our Securities Our executive officers and directors may sell shares of their stock, and these sales could adversely affect our stock price.
We face competition for qualified personnel from other companies with significantly more resources available to them and thus may not be able to attract the level of personnel needed for our business to succeed. 29 If our proposed marketing efforts are unsuccessful, we may not earn enough revenue to become profitable.
We face competition for qualified personnel from other companies with significantly more resources available to them and thus may not be able to attract the level of personnel needed for our business to succeed. If our proposed marketing efforts are unsuccessful, we may not earn enough revenue to become profitable.
We may not be able to prevent the unauthorized disclosure or use of our technical knowledge or other trade secrets by employees or competitors. 27 Furthermore, our competitors may independently develop technologies and products that are substantially equivalent or superior to our technologies and products, which could result in decreased revenues.
We may not be able to prevent the unauthorized disclosure or use of our technical knowledge or other trade secrets by employees or competitors. Furthermore, our competitors may independently develop technologies and products that are substantially equivalent or superior to our technologies and products, which could result in decreased revenues.
Any unforeseen technical obstacles and challenges that we encounter in the research and development process could result in delays in or the abandonment of product commercialization, may substantially increase development costs, and will likely negatively affect our results of operations. 26 Successful technical development of our products does not guarantee successful commercialization.
Any unforeseen technical obstacles and challenges that we encounter in the research and development process could result in delays in or the abandonment of product commercialization, may substantially increase development costs, and will likely negatively affect our results of operations. Successful technical development of our products does not guarantee successful commercialization.
Any accident, even if fully covered or insured, could negatively affect our reputation among our customers and the public, and make it more difficult for us to compete effectively. We may incur substantial product liability claims relating to our products.
Any accident, even if fully covered or insured, could negatively affect our reputation among our customers and the public, and make it more difficult for us to compete effectively. 22 We may incur substantial product liability claims relating to our products.
To the extent any of these events occur, our operations and financial results could be adversely affected. 32 International trade disruptions or disputes could adversely affect our business and operating results. Significant portions of our business are conducted in Europe, Asia, and other international geographies.
To the extent any of these events occur, our operations and financial results could be adversely affected. International trade disruptions or disputes could adversely affect our business and operating results. Significant portions of our business are conducted in Europe, Asia, and other international geographies.
Our failure to compete effectively could have a material adverse effect on our business, prospects, financial condition or future operating results. If we fail to protect our intellectual property rights, we could lose our ability to compete in the marketplace.
Our failure to compete effectively could have a material adverse effect on our business, prospects, financial condition or future operating results. 21 If we fail to protect our intellectual property rights, we could lose our ability to compete in the marketplace.
Failure to do so could deprive us of the intended benefits of those acquisitions. 31 Cyberattacks and other security breaches of network or information technology security could have an adverse effect on our business. We maintain information necessary to conduct our business, including confidential and proprietary information as well as personal information regarding our customers and employees, in digital form.
Failure to do so could deprive us of the intended benefits of those acquisitions. 25 Cyberattacks and other security breaches of network or information technology security could have an adverse effect on our business. We maintain information necessary to conduct our business, including confidential and proprietary information as well as personal information regarding our customers and employees, in digital form.
Any decreased use of our products or limitation on our ability to export or sell our products would likely adversely affect our business, financial condition and results of operations. 33 Worldwide and domestic economic trends and financial market conditions, including an economic decline in the industries we serve, may adversely affect our operating performance.
Any decreased use of our products or limitation on our ability to export or sell our products would likely adversely affect our business, financial condition and results of operations. 28 Worldwide and domestic economic trends and financial market conditions, including an economic decline in the industries we serve, may adversely affect our operating performance.
Currently, the unmanned aerial systems industry lacks a formative insurance market. We may not be able to maintain insurance to protect against all operational risks and uncertainties that our customers confront.
Currently, the uncrewed aerial systems industry lacks a formative insurance market. We may not be able to maintain insurance to protect against all operational risks and uncertainties that our customers confront.
The Additional Warrant is exercisable upon issuance and has a three-year term. On June 5, 2023, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with certain accredited investors (the “Investors”).
The Additional Warrant is exercisable upon issuance and has a three-year term. On June 5, 2023, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with certain accredited investors, which included Alpha, (the “Investors”).
Pursuant to the terms of the Purchase Agreement, the Company has agreed to issue and sell to Investors (i) 16,720,000 shares of Common Stock (the “Offering Shares”) at $0.25 per share and (ii) warrants to purchase up to 25,080,000 shares of common stock (the “Warrants”), exercisable at $0.38 per share (the “Warrant Shares” together with the Warrants and Offering Shares, the “Securities”) and raised gross sales proceeds of $4,180,000.
Pursuant to the terms of the Purchase Agreement, the Company has agreed to issue and sell to Investors (i) 16,720 shares of Common Stock (the “Offering Shares”) at $250.00 per share and (ii) warrants to purchase up to 25,080 shares of common stock (the “Warrants”), exercisable at $380.00 per share (the “Warrant Shares” together with the Warrants and Offering Shares, the “Securities”) and raised gross sales proceeds of $4,180,000.
As a result, pursuant to the Purchase Agreement the Company issued 16,720,000 shares of Common Stock for proceeds of $3,817,400, net of issuance costs from the offering and warrants to purchase up to 25,080,000 shares of common stock exercisable at $0.38 per share.
As a result, pursuant to the Purchase Agreement the Company issued 16,720 shares of Common Stock for proceeds of $3,817,400, net of issuance costs from the offering and warrants to purchase up to 25,080 shares of common stock exercisable at $380.00 per share.
Pursuant to the Investor Notices received by the Company from the Investor and the Assignees on November 15, 2023, delivered in connection with the Assignment, the Investor and the Assignees have provided notices of their desire to purchase 1,850 shares of Preferred Stock (the “November Additional Series F Preferred”) convertible into 14,835,605 shares of Common Stock (the “November Conversion Shares”) at a conversion price of $0.1247 per share and warrants (the “November Additional Warrants”) to purchase up to 14,835,605 shares of our Common Stock an exercise price of $0.1247 per share for an aggregate purchase price of $1,850,000.
Pursuant to the investor notices received by the Company from Alpha and the Assignees on November 15, 2023, delivered in connection with the Assignment, the Investor and the Assignees have provided notices of their desire to purchase 1,850 shares of Preferred Stock (the “November Additional Series F Preferred”) convertible into 14,836 shares of Common Stock (the “November Conversion Shares”) at a conversion price of $124.70 per share and warrants (the “November Additional Warrants”) to purchase up to 14,836 shares of our Common Stock an exercise price of $124.70 per share for an aggregate purchase price of $1,850,000.
Our independent registered public accounting firm’s report contains an explanatory paragraph that expresses substantial doubt about our ability to continue as a “going concern.” As of December 31, 2023, the Company had $0.8 million of cash on hand and working capital of negative $0.5 million.
Our independent registered public accounting firm’s report contains an explanatory paragraph that expresses substantial doubt about our ability to continue as a “going concern.” As of December 31, 2024, the Company had $3.6 million cash on hand and a working capital of $3.1 million.
The Company is evaluating strategies to obtain the required additional funding for future operations and the restructuring of operations to grow revenues and reduce expenses. 25 If the Company is unable to generate significant sales growth in the near term and raise additional capital, there is a risk that the Company could default on obligations; and could be required to discontinue or significantly reduce the scope of its operations if no other means of financing options are available.
If the Company is unable to generate significant sales growth in the near term and raise additional capital, there is a risk that the Company could default on obligations; and could be required to discontinue or significantly reduce the scope of its operations if no other means of financing options are available.
During the year ended December 31, 2023, the Company incurred a net loss of approximately $42.4 million and used cash in operating activities of approximately $11.0 million.
During the year ended December 31, 2024, the Company incurred a net loss of approximately $35.0 million and used cash in operating activities of approximately $6.6 million.
Furthermore, we expect our revenues and operating results to fluctuate in the future due to a number of factors, including the following: ● the timing of sales or subscription of our products; ● unexpected delays in introducing new products and services; ● increased expenses, whether related to sales and marketing or administration; and ● costs related to possible acquisitions of businesses.
Furthermore, we expect our revenues and operating results to fluctuate in the future due to a number of factors, including the following: ● the timing of sales or subscription of our products; ● unexpected delays in introducing new products and services; ● increased expenses, whether related to sales and marketing or administration; and ● costs related to possible acquisitions of businesses. 24 Rapid technological changes may adversely affect the market acceptance of our products and could adversely affect our business, financial condition, and results of operations.
Despite the foregoing, we will require additional financing in the future. If we are unable to raise additional capital, we may have to delay, curtail, or eliminate commercializing, marketing and selling one or more of our solutions.
The Warrants were immediately exercisable upon issuance and have a three-year term. 19 Despite the foregoing, we will require additional financing in the future. If we are unable to raise additional capital, we may have to delay, curtail, or eliminate commercializing, marketing and selling one or more of our solutions.
In the event that these convertible instruments are converted into shares of outstanding Common Stock, or that we make additional issuances of other convertible or exchangeable securities, you could experience additional dilution.
We currently have outstanding instruments which are convertible into shares of Common Stock, and we may need to issue similar instruments in the future. In the event that these convertible instruments are converted into shares of outstanding Common Stock, or that we make additional issuances of other convertible or exchangeable securities, you could experience additional dilution.
We face a significant risk of failure because we cannot accurately forecast our future revenues and operating results. The rapidly changing nature of the markets in which we compete makes it difficult to accurately forecast our revenues and operating results.
The rapidly changing nature of the markets in which we compete makes it difficult to accurately forecast our revenues and operating results.
Pursuant to the Investor Notice received by the Company from Alpha, the Company sold to Alpha 650 shares of November Additional Series F Preferred, which are part of the 1,850 shares and are convertible into 5,212,510 shares of Common Stock at a conversion price of $0.1247 per share (which was adjusted to $0.10 per share as a result of the Common Stock Offering) and November Additional Warrants to purchase up to 5,212,510 shares of our Common Stock an initial exercise price of $0.1247 per share (which was adjusted to $0.10 per warrant as a result of the Common Stock Offering) for an aggregate purchase price of $650,000.
The November Additional Warrants will be exercisable upon issuance and have a three-year term. 18 Pursuant to the Investor Notice received by the Company from Alpha, the Company sold to Alpha 650 shares of November Additional Series F Preferred, which are part of the 1,850 shares and are convertible into 5,213 shares of Common Stock at a conversion price of $124.70 per share (which was adjusted to $100.00 per share as a result of the Common Stock Offering) and November Additional Warrants to purchase up to 5,213 shares of our Common Stock an initial exercise price of $124.70 per share (which was adjusted to $100.00 per warrant as a result of the Common Stock Offering) for an aggregate purchase price of $650,000.
As of December 31, 2023, we had an accumulated deficit of approximately $165.58 million which included net losses of approximately $42.42 million and $58.25 million for the years ended December 31, 2023 and 2022, respectively.
As of December 31, 2024, we had an accumulated deficit of approximately $218.4 million which included net losses of approximately $35.0 million and $42.4 million for the years ended December 31, 2024 and 2023, respectively.
The failure to recruit additional key personnel when needed, with specific qualifications, on acceptable terms and with an ability to maintain positive relationships with our partners, might impede our ability to continue to develop, commercialize and sell our products and services.
For our business to be successful, we need to attract and retain highly qualified executive, technical and sales personnel. The failure to recruit additional key personnel when needed, with specific qualifications, on acceptable terms and with an ability to maintain positive relationships with our partners, might impede our ability to continue to develop, commercialize and sell our products and services.
As the Company will require additional liquidity to continue its operations and meet its financial obligations over the next twelve months, there is substantial doubt about the Company’s ability to continue as a going concern.
As the Company will require additional liquidity to continue its operations and meet its financial obligations over the next twelve months, there is substantial doubt about the Company’s ability to continue as a going concern. The Company is evaluating strategies to obtain the required additional funding for future operations and the restructuring of operations to grow revenues and reduce expenses.
Additionally, on March 15, 2023, Credit Suisse announced that it would borrow up to 50 billion Swiss francs, or $53.7 billion, from the Swiss National Bank to address its liquidity concerns.
For example, on March 10, 2023, Silicon Valley Bank failed and was taken into receivership by the FDIC. Additionally, on March 15, 2023, Credit Suisse announced that it would borrow up to 50 billion Swiss francs, or $53.7 billion, from the Swiss National Bank to address its liquidity concerns.
The preparation of our financial statements involves use of estimates, judgments and assumptions, and our financial statements may be materially affected if our estimates prove to be inaccurate. Financial statements prepared in accordance with generally accepted accounting principles in the United States require the use of estimates, judgments, and assumptions that affect the reported amounts.
Financial statements prepared in accordance with generally accepted accounting principles in the United States require the use of estimates, judgments, and assumptions that affect the reported amounts.
In addition, defects in our products may lead to other potential life, health and property risks. Any claims against us, regardless of their merit, could severely harm our financial condition, strain our management and other resources.
In addition, defects in our products may lead to other potential life, health and property risks. Any claims against us, regardless of their merit, could severely harm our financial condition, strain our management and other resources. We are unable to predict if we will be able to obtain or maintain product liability insurance for any of our products.
Moreover, even if we achieve profitability, given the competitive and evolving nature of the industries in which we operate, we may be unable to sustain or increase profitability and failure to do so would adversely affect our business, including our ability to raise additional funds.
Moreover, even if we achieve profitability, given the competitive and evolving nature of the industries in which we operate, we may be unable to sustain or increase profitability and failure to do so would adversely affect our business, including our ability to raise additional funds. 17 We will need additional funding and may be unable to raise capital when needed, which would force us to delay, curtail or eliminate one or more of our research and development programs or commercialization efforts.
The November Additional Warrants will be exercisable upon issuance and have a three-year term.
The Warrants were immediately exercisable upon issuance and have a three-year term.
Rapid technological changes may adversely affect the market acceptance of our products and could adversely affect our business, financial condition, and results of operations. The markets in which we compete are subject to technological changes, introduction of new products, change in customer demands and evolving industry standards.
The markets in which we compete are subject to technological changes, introduction of new products, change in customer demands and evolving industry standards.
We cannot assure you that the response from regulatory agencies, customers and privacy advocates to these concerns will not delay or restrict the adoption of small UAS by the commercial use markets.
We cannot assure you that the response from regulatory agencies, customers and privacy advocates to these concerns will not delay or restrict the adoption of small UAS by the commercial use markets. We may pursue additional strategic transactions in the future, which could be difficult to implement, disrupt our business or change our business profile significantly.
FINRA requirements will likely make it more difficult for broker-dealers to recommend that their customers buy our Common Stock, which may have the effect of reducing the level of trading activity in the shares, resulting in fewer broker-dealers being willing to make a market in our shares, potentially reducing a stockholder’s ability to resell our securities. 36 If securities or industry analysts do not publish research or reports about our business, if they adversely change their recommendations regarding our shares or if our results of operations do not meet their expectations, the price of our securities and trading volume could decline.
FINRA requirements will likely make it more difficult for broker-dealers to recommend that their customers buy our Common Stock, which may have the effect of reducing the level of trading activity in the shares, resulting in fewer broker-dealers being willing to make a market in our shares, potentially reducing a stockholder’s ability to resell our securities.
If the release dates of our new products or enhancements are delayed or, if when released, they fail to achieve market acceptance, our business, operating results, and financial condition may be adversely affected. 30 Failure to obtain necessary regulatory approvals from the FAA or other governmental agencies, or limitations put on the use of small UAS in response to public privacy concerns, may prevent us from expanding the sales of our drone solutions to commercial and industrial customers in the United States.
Failure to obtain necessary regulatory approvals from the FAA or other governmental agencies, or limitations put on the use of small UAS in response to public privacy concerns, may prevent us from expanding the sales of our drone solutions to commercial and industrial customers in the United States.
As a result, capital appreciation, if any, from the sale of our Common Stock will be your sole source of gain for the foreseeable future. 35 Provisions in our articles of incorporation, our by-laws and Nevada law might discourage, delay or prevent a change in control of our Company or changes in our management and, therefore, depress the trading price of our Common Stock.
Provisions in our articles of incorporation, our by-laws and Nevada law might discourage, delay or prevent a change in control of our Company or changes in our management and, therefore, depress the trading price of our Common Stock.
The Warrant is not exercisable for the first six months after issuance and has a five-year term from the initial exercise date of June 6, 2023. 24 On March 10, 2023, the Company issued and sold to the Investor an additional 3,000 shares of Series F convertible into 2,381 shares of the Company’s common stock, per $1,000 Stated Value per share of Preferred Stock, at a conversion price of $0.42 per share and associated common stock warrant to purchase up to 7,142,715 shares of common stock at the exercise price of $0.42 per share warrant (the “Additional Warrant”) in a private placement and raised $3,000,000 in gross proceeds.
On March 10, 2023, the Company issued and sold to the Alpha Capital Anstalt (“Alpha” or “Investor”) an additional 3,000 shares of Series F convertible into 2,381 shares of the Company’s common stock, per $1,000 Stated Value per share of Preferred Stock, at a conversion price of $420.00 per share and associated common stock warrant to purchase up to 7,143 shares of common stock at the exercise price of $420.00 per share warrant (the “Additional Warrant”) in a private placement and raised $3,000,000 in gross proceeds.
Prolonged unrest intensified military activities or more extensive sanctions impacting the region could have a material adverse effect on the global economy, and such effect could in turn have a material adverse effect on the operations, results of operations, financial condition, liquidity and business outlook of our business.
Prolonged unrest intensified military activities or more extensive sanctions impacting the region could have a material adverse effect on the global economy, and such effect could in turn have a material adverse effect on the operations, results of operations, financial condition, liquidity and business outlook of our business. 27 There has been volatility in financial markets as a result of a number of factors, including, but not limited to, banking instability, global conflict, including the war in Ukraine and the Israel-Hamas war, inflation, changes in interest rates, and volatile markets.
In addition, we may not be able to continue to obtain such components from these suppliers on satisfactory commercial terms. Disruptions of our manufacturing operations would ensue if we were required to obtain components from alternative sources, which would have an adverse effect on our business, results of operations and financial condition.
Disruptions of our manufacturing operations would ensue if we were required to obtain components from alternative sources, which would have an adverse effect on our business, results of operations and financial condition. 23 If we are unable to recruit and retain key management, technical and sales personnel, our business would be negatively affected.
We currently have outstanding, and we may in the future issue, instruments which are convertible into shares of Common Stock, which will result in additional dilution to our shareholders. We currently have outstanding instruments which are convertible into shares of Common Stock, and we may need to issue similar instruments in the future.
For example, we expect that these rules and regulations will continue to make it more difficult and more expensive for us to obtain director and officer liability insurance. 30 We currently have outstanding, and we may in the future issue, instruments which are convertible into shares of Common Stock, which will result in additional dilution to our shareholders.
Moreover, these rules and regulations have increased our legal and financial compliance costs and have made some activities more time consuming and costly. For example, we expect that these rules and regulations will continue to make it more difficult and more expensive for us to obtain director and officer liability insurance.
Moreover, these rules and regulations have increased our legal and financial compliance costs and have made some activities more time consuming and costly.
We will require additional funds to support our continued research and development activities, as well as the costs of commercializing, marketing and selling any existing and new products and/or services resulting from those activities. Until such time, that we can generate sufficient revenue and achieve profitability, we will need to meet our future cash needs through equity or debt financings.
Our operations have consumed substantial amounts of cash since inception. We expect to continue to spend substantial amounts on product and software development. We will require additional funds to support our continued research and development activities, as well as the costs of commercializing, marketing and selling any existing and new products and/or services resulting from those activities.
We are unable to predict if we will be able to obtain or maintain product liability insurance for any of our products. 28 We maintain cash deposits in excess of federally insured limits. Adverse developments affecting financial institutions, including bank failures, could adversely affect our liquidity and financial performance.
We maintain cash deposits in excess of federally insured limits. Adverse developments affecting financial institutions, including bank failures, could adversely affect our liquidity and financial performance. We regularly maintain domestic cash deposits in Federal Deposit Insurance Corporation (“FDIC”) insured banks, which exceed the FDIC insurance limits.
Bank failures, events involving limited liquidity, defaults, non-performance or other adverse developments that affect financial institutions, or concerns or rumors about such events, may lead to liquidity constraints. For example, on March 10, 2023, Silicon Valley Bank failed and was taken into receivership by the FDIC.
We also maintain cash deposits in foreign banks where we operate, some of which are not insured or are only partially insured by the FDIC or other similar agencies. Bank failures, events involving limited liquidity, defaults, non-performance or other adverse developments that affect financial institutions, or concerns or rumors about such events, may lead to liquidity constraints.
There can be no assurance that we will be successful in our capital raising efforts.
Until such time, that we can generate sufficient revenue and achieve profitability, we will need to meet our future cash needs through equity or debt financings. There can be no assurance that we will be successful in our capital raising efforts.
Removed
We will need additional funding and may be unable to raise capital when needed, which would force us to delay, curtail or eliminate one or more of our research and development programs or commercialization efforts. Our operations have consumed substantial amounts of cash since inception. We expect to continue to spend substantial amounts on product and software development.
Added
On March 6, 2024, in connection with the Assigned Rights, the Company received investor notices from Alpha and the Assignees for the aggregate purchase of 1,000 shares of Series F Convertible Preferred convertible into 16,588 shares of Common Stock at a conversion price of $60.29 and warrants to purchase up to 16,588 shares of Common Stock an exercise price of $60.29 per share for an aggregate purchase price of $1,000,000.
Removed
On May 25, 2021, the Company entered into an at-the-market Sales Agreement (the “ATM Sales Agreement”) with Stifel, Nicolaus & Company, Incorporated and Raymond James & Associates, Inc. as sales agents (the “Agents”), in connection with the offer and sale from time to time of shares of the Company’s Common stock, having an aggregate offering price of up to $100,000,000 (the “ATM Shares”), through an at-the-market equity offering program (the “ATM Offering”).
Added
On April 12, 2024, the Company received an investor notice from Alpha for the aggregate purchase of 1,050 shares of Series F Convertible Preferred convertible into 28,378 shares of Common Stock, in the aggregate, at a conversion price of $37.00 and warrants to purchase up to 28,378 shares of Common Stock at an exercise price of $37.00 per share (based on the VWAPs of the Company’s common stock for April 9, 2024, April 10, 2024, and April 11,2024) for an aggregate purchase price of $1,050,000.
Removed
During 2022, we raised total gross proceeds of $17.8 million in debt and equity transactions, including $4.6 million through the ATM Offering. On June 26 2022, the Company entered into a Securities Purchase Agreement with an institutional investor (the “Investor”) which is an existing shareholder of the Company.
Added
The Warrants were immediately exercisable upon issuance and have a three-year term.
Removed
Pursuant to the terms of that agreement, the Company issued and sold to the Investor 10,000 shares of the Series F 5% Preferred Convertible Stock (“Series F”) and warrants to purchase up to 16,129,032 shares of the Company’s Common Stock at $0.96 per share in a registered direct offering and raised a total of $10,000,000 in gross proceeds.
Added
On May 31, 2024, the Company received investor notices from Alpha and certain of the Assignees for the aggregate purchase of 1,050 shares of Series F Convertible Preferred convertible into 32,659 shares of Common Stock at a conversion price of $32.15 and warrants to purchase up to 32,659 shares of Common Stock at an exercise price of $32.15 per share for an aggregate purchase price of $1,050,000.
Removed
On December 6, 2022, the Company and the Investor entered into a Securities Purchase Agreement pursuant to which the Company issued and sold to the Investor (i) a 8% original issue discount promissory note (the “Note”) in the aggregate principal amount of $3,500,000, and (ii) a common stock purchase warrant (the “Warrant”) to purchase up to 5,000,000 shares of the Company’s Common Stock (the “Shares”) at an exercise price of $0.44 per share, subject to standard anti-dilution adjustments.
Added
The Warrants were immediately exercisable upon issuance and have a three-year term.
Removed
The Note is an unsecured obligation of the Company. It has an original issue discount of 4% and bears interest at 8% per annum. The Company received net proceeds of $3,285,000 net of the original issue discount of $140,000 and $75,000 of issuance costs.
Added
On July 25, 2024, the Company received investor notice from Alpha for the aggregate purchase of 500 shares of Series F Convertible Preferred convertible into 21,598 shares of Common Stock at a conversion price of $23.15 and warrants to purchase up to 21,598 shares of Common Stock at an exercise price of $23.15 per share for an aggregate purchase price of $500,000.
Removed
The foregoing description of the Assignment Agreement does not purport to be complete and is qualified in its entirety by reference to the Assignment Agreement , filed as Exhibit 10.2 to this Current Report and incorporated by reference herein.
Added
The Warrants were immediately exercisable upon issuance and have a three-year term.
Removed
We regularly maintain domestic cash deposits in Federal Deposit Insurance Corporation (“FDIC”) insured banks, which exceed the FDIC insurance limits. We also maintain cash deposits in foreign banks where we operate, some of which are not insured or are only partially insured by the FDIC or other similar agencies.
Added
On August 27, 2024, the Company received investor notice from Alpha for the aggregate purchase of 500 shares of Series F Convertible Preferred convertible into 24,765 shares of Common Stock at a conversion price of $20.19 and warrants to purchase up to 24,765 shares of Common Stock at an exercise price of $20.19 per share for an aggregate purchase price of $500,000.
Removed
If we are unable to recruit and retain key management, technical and sales personnel, our business would be negatively affected. For our business to be successful, we need to attract and retain highly qualified executive, technical and sales personnel.
Added
The Warrants were immediately exercisable upon issuance and have a three-year term.
Removed
Federal, state and tribal government regulation of domestic hemp cultivation is new and subject to constant change and evolution, and unfavorable developments could have an adverse effect on our operating results. Any changes in laws or regulations relating to domestic hemp cultivation could adversely affect our business, results of operations and our business prospects for our HempOverview SaaS platform.
Added
On September 30, 2024, the Company entered into a placement agency agreement (the “Placement Agency Agreement”) with Spartan Capital Securities, LLC (the “Placement Agent”) in connection with the issuance and sale by the Company in a public offering (the “Offering”) of 538,000 units (the “Units”), consisting of common units (“Common Units”), each consisting of one share of common stock of the Company, $0.001 par value per share, one Series A warrant (“Series A Warrant”) to purchase one share of common stock and one Series B warrant (“Series B Warrant”) to purchase one share of common stock and pre-funded Units (the “Pre-Funded Units” and together with the Common Units, the “Units”), with each Pre-Funded Unit consisting of one pre-funded warrant (the “Pre-Funded Warrants”) to purchase one share of common stock, one Series A Warrant to purchase one share of common stock and one Series B Warrant to purchase one share of common stock, resulting in net proceed of $5,677,739.
Removed
We may pursue additional strategic transactions in the future, which could be difficult to implement, disrupt our business or change our business profile significantly.
Added
On October 7, 2024, as part of “October 2024 Offering”, the Company issued and delivered to Alpha 1,500 shares of Series F 5% Convertible Preferred Stock with an aggregate stated value of $1,500,000 and having all the rights and benefits of Series F 5% Convertible Preferred Stock convertible into 1,363,636 shares of Common Stock with a conversion price of $1.10 as of December 31, 2024.
Removed
These limitations or failures could result in reputational damage, legal liabilities, or loss of user confidence. We are making investments in AI initiatives, including generative AI, to, among other things, develop new products, and develop new features for existing products.
Added
On December 18, 2024, the Company received investor notice from Alpha for the aggregate purchase of 750 shares of Series F Convertible Preferred convertible into 142,857 shares of Common Stock at a conversion price of $5.25 and warrants to purchase up to 142,857 shares of Common Stock at an exercise price of $5.25 per share for an aggregate purchase price of $750,000.
Removed
There are significant risks involved in development and deploying AI and there can be no assurance that the usage of AI will enhance our products or services or be beneficial to our business, including our efficiency or profitability.
Added
In addition, we may not be able to continue to obtain such components from these suppliers on satisfactory commercial terms.
Removed
For example, our AI-related efforts may give rise to risks related to accuracy, intellectual property infringement or misappropriation, data privacy, and cybersecurity, among others.
Added
Additionally, the countries in which we purchase raw materials from to manufacture our finished product could become subject to new trade restrictions, including increased taxation on imported goods, customs restrictions, tariffs or quotas. We face a significant risk of failure because we cannot accurately forecast our future revenues and operating results.
Removed
In addition, these risks include the possibility of new or enhanced governmental or regulatory scrutiny, litigation, or other legal liability, ethical concerns, negative consumer perceptions as to automation and AI, or other complications that could adversely affect our business, reputation, or financial results. Further, we face significant competition from other companies that are developing their own AI products and technologies.
Added
If the release dates of our new products or enhancements are delayed or, if when released, they fail to achieve market acceptance, our business, operating results, and financial condition may be adversely affected.
Removed
Those other companies may develop AI products and technologies that are similar or superior to our technologies or are more cost-effective to develop and deploy.
Added
These limitations or failures could result in reputational damage, legal liabilities, or loss of user confidence. 26 The preparation of our financial statements involves use of estimates, judgments and assumptions, and our financial statements may be materially affected if our estimates prove to be inaccurate.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

11 edited+1 added−1 removed5 unchanged
Biggest changeThe Audit Committee oversees management’s implementation of our cybersecurity risk management program and receives updates on the cybersecurity risk management program from management at least annually. In addition, management updates the Audit Committee regarding any material or significant cybersecurity incidents, as well as incidents with lesser impact potential as necessary.
Biggest changeCybersecurity Governance Our Board considers cybersecurity risks as part of its risk oversight function of cybersecurity and other information technology risks. The Audit Committee oversees management’s implementation of our cybersecurity risk management program and receives updates on the cybersecurity risk management program from management at least annually.
The Chief Financial Officer will oversees our information security programs, including cybersecurity initiatives, and is integrated into our Cybersecurity Incident response process. The Audit committee oversees cybersecurity risk management activities, supported by Company management, the Board of Directors, and external consultants. We assess and prioritize risks based on potential impact, implement technical controls, and monitor third-party vendors’ security practices. 38
The Chief Operating Officer oversees our information security programs, including cybersecurity initiatives, and is integrated into our Cybersecurity Incident response process. The Audit committee oversees cybersecurity risk management activities, supported by Company management, the Board of Directors, and external consultants. We assess and prioritize risks based on potential impact, implement technical controls, and monitor third-party vendors’ security practices.
Despite well-designed controls, we acknowledge the inability to foresee all security breaches, including those stemming from third-party misuse of AI technologies, and the potential challenges in implementing timely preventive measures. Please refer to Item 1A: Risk Factors for further insights into cyber attack-related risks.
However, given the escalating sophistication of cyber threats, our preventive measures may not always suffice. Despite well-designed controls, we acknowledge the inability to foresee all security breaches, including those stemming from third-party misuse of AI technologies, and the potential challenges in implementing timely preventive measures. Please refer to Item 1A: Risk Factors for further insights into cyber attack-related risks.
We have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition.
Ongoing Risks We have not experienced any material cybersecurity incidents. We have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected us, including our operations, business strategy, results of operations, or financial condition.
The Company is in the process of establishing a cybersecurity policy which implement protocols to evaluate, recognize, and address significant risks, including those posed by cybersecurity threats.
This cybersecurity policy is designed to establish a comprehensive framework for identifying, assessing, mitigating, and responding to cybersecurity risks across the organization. The Company is in the process of establishing a cybersecurity policy which implement protocols to evaluate, recognize, and address significant risks, including those posed by cybersecurity threats.
The Audit Committee reports to the full Board annually regarding cybersecurity. The full Board also receives annual briefings from external experts on cybersecurity as part of the Board’s continuing education on topics that impact public companies. Ongoing Risks We have not experienced any material cybersecurity incidents.
In addition, management updates the Audit Committee regarding any material or significant cybersecurity incidents, as well as incidents with lesser impact potential as necessary. The Audit Committee reports to the full Board annually regarding cybersecurity. The full Board also receives annual briefings from external experts on cybersecurity as part of the Board’s continuing education on topics that impact public companies.
Our cybersecurity risk management program is integrated into our overall enterprise risk management program and shares common methodologies, reporting channels, and governance processes that apply across the enterprise risk management program to other legal, compliance, strategic, operational, and financial risk areas.
We use the NIST CSF as a guide to help us identify, assess, and manage cybersecurity risks relevant to our business. 31 Our cybersecurity risk management program is integrated into our overall enterprise risk management program and shares common methodologies, reporting channels, and governance processes that apply across the enterprise risk management program to other legal, compliance, strategic, operational, and financial risk areas.
We have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected us, including our operations, business strategy, results of operations, or financial condition. For more information on our cybersecurity related risks, see Item 1A Risk Factors of this Annual Report on Form 10-K.
We have no t identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition. For more information, please refer to Item 1A: Risk Factors for further insights into cyber attack-related risks.
Risk Management and Strategy The Company recognizes the critical importance of cybersecurity in safeguarding sensitive information, maintaining operational resilience, and protecting stakeholders’ interests. This cybersecurity policy is designed to establish a comprehensive framework for identifying, assessing, mitigating, and responding to cybersecurity risks across the organization.
For more information on our cybersecurity related risks, see Item 1A Risk Factors of this Annual Report on Form 10-K. 32 Risk Management and Strategy The Company recognizes the critical importance of cybersecurity in safeguarding sensitive information, maintaining operational resilience, and protecting stakeholders’ interests.
This does not imply that we meet any particular technical standards, specifications, or requirements. We use the NIST CSF as a guide to help us identify, assess, and manage cybersecurity risks relevant to our business.
This does not imply that we meet any particular technical standards, specifications, or requirements.
Cybersecurity threats haven’t significantly impacted our operations, and we don’t anticipate such risks materially affecting our business, strategy, financial condition, or results of operations. However, given the escalating sophistication of cyber threats, our preventive measures may not always suffice.
This approach is designed to help identify and mitigate risks related to data breaches or other cybersecurity incidents originating from third-parties in order to better protect our assets and data. Cybersecurity threats haven’t significantly impacted our operations, and we don’t anticipate such risks materially affecting our business, strategy, financial condition, or results of operations.
Removed
For more information, please refer to Item 1A: Risk Factors for further insights into cyber attack-related risks. 37 Cybersecurity Governance Our Board considers cybersecurity risks as part of its risk oversight function of cybersecurity and other information technology risks.
Added
We are aware of the risks associated with third-party service providers and have implemented policies and processes to oversee and assist with managing these risks. Our management team evaluates third-party providers before engagement and monitors these providers on an ongoing basis commensurate with the level of risk and complexity of the relationship with, and the activities performed by, such providers.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeNorthlake Way Seattle, Washington (Subleased) Offices 60 January 2026 As of December 31, 2023, the Company held properties in Wichita, KS, Lausanne, Switzerland; and Seattle, WA and represent non-cancellable lease obligations assumed by the Company as a result of its 2021 business acquisitions of senseFly S.A., senseFly Inc., Measure Global Inc., and MicaSense, Inc., respectively.
Biggest changeNorthlake Way Seattle, Washington (Subleased) Offices 60 December 31, 2026 As of December 31, 2024, the Company held properties in Wichita, KS, Lausanne, Switzerland; and Seattle, WA and represent non-cancellable lease obligations assumed by the Company as a result of its 2021 business acquisitions of senseFly S.A., senseFly Inc., Measure Global Inc., and MicaSense, Inc., respectively. 33
PROPERTIES As of December 31, 2023, the Company is a party to the following non-cancellable operating leases for manufacturing facilities and office space: Location Purpose Initial Term (months) Lease Expiration Date 8201 E. 34 th Cir N Suite 1307 Wichita, Kansas Manufacturing Facility & Corporate Headquarters 36 October 31, 2026 Route de Genève 38 1033 Cheseaux-sur-Lausanne, Switzerland Distribution & Assembly Facility & Offices 60 April 30, 2028 1300 N.
PROPERTIES As of December 31, 2024, the Company is a party to the following non-cancellable operating leases for manufacturing facilities and office space: Location Purpose Initial Term (months) Lease Expiration Date 8201 E. 34 th North Suite 1307 Wichita, Kansas Manufacturing Facility & Corporate Headquarters 36 October 31, 2026 Route de Genève 38 1033 Cheseaux-sur-Lausanne, Switzerland Distribution & Assembly Facility & Offices 60 April 30, 2028 1300 N.
Removed
Starting late 2022, the Company has been engaged in consolidating its business and manufacturing operations from multiple offices to two centralized locations in Wichita, Kansas and Lausanne, Switzerland. We expect to complete our consolidation efforts before the end of 2024. We vacated our offices in Seattle, Washington and subleased the offices to a third party in May 2023.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed2 unchanged
Biggest changeLiabilities in excess of our insurance coverage, including coverage for professional liability and certain other claims, could have a material adverse effect on our business, financial condition and results of operations. As of March 31, 2024, there are no pending, nor to our knowledge threatened, legal proceedings against us.
Biggest changeLiabilities in excess of our insurance coverage, including coverage for professional liability and certain other claims, could have a material adverse effect on our business, financial condition and results of operations. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

8 edited+9 added−3 removed2 unchanged
Biggest changeThe table represents the price closures for fiscal year 2023, prior to the approved reverse stock split as of February 9, 2024, as well as the adjusted 20 for 1 reverse stock split on an historical basis for comparison. 2024 High Post Split Low Post Split First Quarter (through March 28, 2024) (post split as of February 9, 2024) $ 11.60 $ 0.68 2023 High Pre Split High Post Split Low Pre Split Low Post Split First Quarter $ 0.58 $ 11.60 $ 0.35 $ 7.00 Second Quarter $ 0.50 $ 10.00 $ 0.22 $ 4.40 Third Quarter $ 0.26 $ 5.20 $ 0.16 $ 3.20 Fourth Quarter $ 0.18 $ 3.60 $ 0.10 $ 2.00 2022 High Pre Split High Post Split Low Pre Split Low Post Split First Quarter $ 1.76 $ 35.20 0.91 $ 18.20 Second Quarter $ 1.19 $ 23.80 0.58 $ 11.60 Third Quarter $ 0.79 $ 15.80 0.46 $ 9.20 Fourth Quarter $ 0.58 $ 11.60 0.31 $ 6.20 As of March 31, 2024, we had approximately 285 individual shareholders of record of our Common Stock.
Biggest changeThe table represents the price closures for fiscal year 2024, prior to the approved reverse stock split as of October 14, 2024, as well as the adjusted 50 for 1 reverse stock split on an historical basis for comparison. 2024 High Pre Split High Post Split 50:1 Low Pre Split Low Post Split 50:1 First Quarter $ 2.25 $ 112.40 $ 0.68 $ 34.00 Second Quarter $ 0.79 $ 39.68 $ 0.49 $ 24.34 Third Quarter $ 0.49 $ 24.42 $ 0.09 $ 4.71 Fourth Quarter $ 0.18 $ 8.94 $ 0.03 $ 1.61 2023 High Pre Split High Post Split 50:1 Low Pre Split Low Post Split 50:1 First Quarter $ 11.60 $ 580.00 $ 7.00 $ 350.00 Second Quarter $ 10.00 $ 500.00 $ 4.40 $ 220.00 Third Quarter $ 5.20 $ 260.00 $ 3.20 $ 160.00 Fourth Quarter $ 3.60 $ 180.00 $ 2.00 $ 100.00 As of March 31, 2025, we had approximately 285 individual shareholders of record of our Common Stock.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our Common Stock is currently quoted on the NYSE American under the symbol “UAVS.” The following table sets forth, for the period indicated, the quarterly high and low closing sales prices per share of our Common Stock for each quarter during our last three fiscal years, as reported by the New York Stock Exchange.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our Common Stock is currently quoted on the NYSE American under the symbol “UAVS.” The following table sets forth, for the period indicated, the quarterly high and low closing sales prices per share of our Common Stock for each quarter during our last two fiscal years, as reported by the New York Stock Exchange.
Any future determination related to our dividend policy will be made at the discretion of our Board of Directors and will depend upon, among other factors, our results of operations, financial condition, capital requirements, contractual restrictions, business prospects and other factors our Board of Directors may deem relevant. 40 Equity Compensation Plan The following table sets forth information as of the fiscal year ended December 31, 2023 about our equity compensation plan and arrangements.
Any future determination related to our dividend policy will be made at the discretion of our Board of Directors and will depend upon, among other factors, our results of operations, financial condition, capital requirements, contractual restrictions, business prospects and other factors our Board of Directors may deem relevant. 34 Equity Compensation Plan The following table sets forth information as of the fiscal year ended December 31, 2024 about our equity compensation plan and arrangements.
Plan Category Number of shares to be issued upon exercise of outstanding options, and restricted stock units Weighted-average exercise price of outstanding options and restricted stock units Number of shares remaining available for future issuance under equity compensation plans Equity compensation plans approved by stockholders 5,558,732 $ 0.90 5,959,773 Equity compensation plans not approved by stockholders — — — 5,558,732 $ 0.90 5,959,773 Recent Sales of Unregistered Securities On December 6, 2022, the Company issued and sold to an institutional investor a Common Stock Purchase Warrant to purchase up to 5,000,000 shares of the Company’s Common Stock at an exercise price of $0.44 per share, subject to adjustments pursuant to the Common Stock Purchase Warrant.
Plan Category Number of shares to be issued upon exercise of outstanding options, and restricted stock units Weighted-average exercise price of outstanding options and restricted stock units Number of shares remaining available for future issuance under equity compensation plans Equity compensation plans approved by stockholders 7,349 $ 33.63 3,473 Equity compensation plans not approved by stockholders — — — 7,349 $ 33.63 3,473 Recent Sales of Unregistered Securities On March 6, 2024, the Company received an investor notice from Alpha and the Assignees for the aggregate purchase of 1,000 shares of Series F Convertible Preferred convertible into 16,588 shares of Common Stock at an initial conversion price of $60.29 and warrants to purchase up to 16,588 shares of Common Stock at an initial exercise price of $60.29 (the “Warrants”) per share for an aggregate purchase price of $1,000,000.
Issuer Purchases of Securities There were no repurchases of the Company’s securities during the year ended December 31, 2023 by or on behalf of the Company or any “affiliated purchaser,” as defined in § 240.10b-18(a)(3) of the Exchange Act. Purchases of Equity Securities by Issuer and Its Affiliates None. ITEM 6. [RESERVED]
The Series F Preferred Stock and the Warrants, except those issued pursuant to placement agent agreements, include pricing adjustments for stock splits, dividends, recapitalization and subsequent equity sales and issuance of equity-linked instruments. 35 Issuer Purchases of Securities There were no repurchases of the Company’s securities during the year ended December 31, 2024 by or on behalf of the Company or any “affiliated purchaser,” as defined in § 240.10b-18(a)(3) of the Exchange Act.
On March 9, 2023, the Company received an Investor Notice to purchase 3,000 Additional Series F Preferred, with each Additional Series F Preferred convertible into 2,381 shares of the Company’s common stock at a conversion price of $0.42 per share and associated common stock warrant to purchase up to 7,142,715 Additional Warrants for an aggregate purchase price of $3,000,000 pursuant to a Series F Agreement dated June 26, 2022.
On July 25, 2024, the Company received investor notice from Alpha for the aggregate purchase of 500 shares of Series F Convertible Preferred convertible into 21,598 shares of Common Stock at a conversion price of $23.15 and warrants to purchase up to 21,598 shares of Common Stock at an exercise price of $23.15 per share for an aggregate purchase price of $500,000.
On November 15, 2023, the Company issued and sold to investors the November Additional Warrants to purchase 14,835,605 shares of our Common Stock at initial exercise price of $0.1247 per share, subject to adjustments pursuant to the November Additional Warrants, for an aggregate purchase price of $1,850,000 .
On May 31, 2024, the Company received investor notices from Alpha and certain of the Assignees for the aggregate purchase of 1,050 shares of Series F Convertible Preferred convertible into 32,659 shares of Common Stock at an initial conversion price of $32.15 and warrants to purchase up to 32,659 shares of Common Stock at an initial exercise price of $32.15 per share for an aggregate purchase price of $1,050,000.
On June 5, 2023, the Company issued and sold to three institutional investors 16,720,000 shares of the Company’s common stock at $0.25 per share and associated common stock warrant to purchase up to 25,080,000 shares at an exercise price of $0.38 per share, subject to adjustments pursuant to the Common Stock Purchase Warrants.
On December 18, 2024, the Company received investor notice from Alpha for the aggregate purchase of 750 shares of Series F Convertible Preferred convertible into 142,857 shares of Common Stock at an initial conversion price of $5.25 and warrants to purchase up to 142,857 shares of Common Stock at an initial exercise price of $5.25 per share for an aggregate purchase price of $750,000.
Removed
The Additional Warrant is exercisable upon issuance and has a three-year term. On March 10, 2023, the Company issued and sold the Additional Series F Preferred and the Additional Warrant.
Added
The Warrants were immediately exercisable upon issuance and have a three-year term.
Removed
The Company also sold 1,500,000 shares of Common Stock at $0.10 per share, raising an additional $150,000 in gross proceeds.
Added
On April 12, 2024, the Company received an investor notice from Alpha for the aggregate purchase of 1,050 shares of Series F Convertible Preferred convertible into 28,378 shares of Common Stock, in the aggregate, at an initial conversion price of $37.00 and warrants to purchase up to 28,378 shares of Common Stock at an initial exercise price of $37.00 per share (based on the VWAPs of the Company’s common stock for April 9, 2024, April 10, 2024, and April 11, 2024) for an aggregate purchase price of $1,050,000.
Removed
On November 15, 2023, the Company issued to Dawson warrants to purchase 1,483,560 shares of our Common Stock at the exercise price of $0.1247 per warrant, and 1,281,796 of the 1,483,560 warrants were subsequently assigned by Dawson to certain Selling Shareholders.
Added
The Warrants were immediately exercisable upon issuance and have a three-year term.
Added
The Warrants were immediately exercisable upon issuance and have a three-year term.
Added
The Warrants were immediately exercisable upon issuance and have a three-year term.
Added
On August 27, 2024, the Company received investor notice from Alpha for the aggregate purchase of 500 shares of Series F Convertible Preferred convertible into 24,765 shares of Common Stock at an initial conversion price of $20.19 and warrants to purchase up to 24,765 shares of Common Stock at an initial exercise price of $20.19 per share for an aggregate purchase price of $500,000.
Added
The Warrants were immediately exercisable upon issuance and have a three-year term.
Added
The Warrants were immediately exercisable upon issuance and have a three-year term.
Added
Purchases of Equity Securities by Issuer and Its Affiliates None. ITEM 6. [RESERVED]

Item 7. Management's Discussion & Analysis

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

51 edited+9 added−31 removed78 unchanged
Biggest changeThis was offset with an increase of $0.9 million in interest expense, and due to the third quarter 2022 recognition of $6.5 million non-cash gain on debt extinguishment associated with reductions of holdback liabilities in connection with our acquisitions of senseFly and MicaSense that was not recognized in 2023, plus the loss on the debt extinguishment and interest on the Promissory Note amounting to $1.9 million. 50 Cash Flows Twelve Months Ended December 31, 2023 as Compared to the Twelve Months Ended December 31, 2022 As of December 31, 2023, cash on hand was $0.8 million, a decrease of $3.5 million or 81.4%, as compared to $4.3 million as of December 31, 2022.
Biggest changeThis was offset with an increase of $15.3 million on loss of equity financing that was not recognized in 2023. 44 Cash Flows For the Year Ended December 31, 2024 as Compared to the Year Ended December 31, 2023 As of December 31, 2024, cash on hand was $3.6 million, an increase of $2.8 million or 350%, as compared to $0.8 million as of December 31, 2023.
Intangible Impairment The annual intangible impairment conducted during the fourth quarter of 2023 indicated that the fair value of the SaaS and the Company’s Drones reporting units were less than carrying value.
The annual intangible impairment conducted during the fourth quarter of 2023 indicated that the fair value of the SaaS and the Company’s Drones reporting units were less than carrying value.
We believe that this will serve to advance our efforts to achieve deeper penetration of the government sector over the next five years. ● Our eBee TAC ™ UAS has been approved by the Defense Innovation Unit (DIU) for procurement by the Department of Defense – We believe that the eBee TAC is ideally positioned to become an in-demand, mission critical tool for the U.S. military, government and civil agencies and our allies worldwide; and expect that this will prove to be a major growth catalyst for our Company in 2022, positively impacting our financial performance in the years ahead. eBee TAC is available for purchase by U.S. government agencies and all branches of the military on GSA Schedule Contract #47QTCA18D003G, supplied by Hexagon US Federal and partner Tough Stump Technologies as a standalone solution or as part of the Aerial Reconnaissance Tactical Edge Mapping Imagery System (“ARTEMIS”).
We believe that this will serve to advance our efforts to achieve deeper penetration of the government sector over the next five years. ● Our eBee TAC ™ UAS has been approved by the Defense Innovation Unit (DIU) for procurement by the Department of Defense – We believe that the eBee TAC is ideally positioned to become an in-demand, mission critical tool for the U.S. military, government and civil agencies and our allies worldwide; and expect that this will prove to be a major growth catalyst for our Company and positively impacting our financial performance in the years ahead. eBee TAC is available for purchase by U.S. government agencies and all branches of the military on GSA Schedule Contract #47QTCA18D003G, supplied by Hexagon US Federal and partner Tough Stump Technologies as a standalone solution or as part of the Aerial Reconnaissance Tactical Edge Mapping Imagery System (“ARTEMIS”).
Risk Factors for a discussion of the uncertainties, risks and assumptions associated with these forward-looking statements. 41 Overview AgEagle ™ Aerial Systems Inc. (“AgEagle” or the “Company”), through its wholly owned subsidiaries, is actively engaged in designing and delivering best-in-class drones, sensors and software that solve important problems for our customers.
Risk Factors for a discussion of the uncertainties, risks and assumptions associated with these forward-looking statements. Overview AgEagle ™ Aerial Systems Inc. (“AgEagle” or the “Company”), through its wholly owned subsidiaries, is actively engaged in designing and delivering best-in-class drones, sensors and software that solve important problems for our customers.
We also review our portfolio on a regular basis to determine if and when to narrow our focus on the highest potential growth opportunities. ● Growth through acquisition. Through successful execution of our growth-through-acquisition strategies, we intend to acquire technologically advanced UAS companies and intellectual property that complement and strengthen our value proposition to the market.
We also review our portfolio on a regular basis to determine if and when to narrow our focus on the highest potential growth opportunities. 37 ● Growth through acquisition. Through successful execution of our growth-through-acquisition strategies, we intend to acquire technologically advanced UAS companies and intellectual property that complement and strengthen our value proposition to the market.
Being the first company to receive this DVR from EASA for M2 mitigation is a milestone for AgEagle and our industry in the European Union and will be key to fueling growth of our international customer base. 45 |In August 2022, we announced that the eBee X, eBee GEO and eBee AG were the first commercial drones to be designated with the C2 class identification label in accordance with EASA regulations.
Being the first company to receive this DVR from EASA for M2 mitigation is a milestone for AgEagle and our industry in the European Union and will be key to fueling growth of our international customer base. 39 |In August 2022, we announced that the eBee X, eBee GEO and eBee AG were the first commercial drones to be designated with the C2 class identification label in accordance with EASA regulations.
Today, the Company is earning distinction as a globally respected market leader offering customer-centric, advanced, autonomous unmanned aerial systems (“UAS”) which drive revenue at the intersection of flight hardware, sensors and software for industries that include agriculture, military/defense, public safety, surveying/mapping and utilities/engineering, among others.
Today, the Company is earning distinction as a globally respected market leader offering customer-centric, advanced, autonomous uncrewed aerial systems (“UAS”) which drive revenue at the intersection of flight hardware, sensors and software for industries that include agriculture, military/defense, public safety, surveying/mapping and utilities/engineering, among others.
We may be required to record additional inventory write-downs if actual market conditions are less favorable than those projected by our management. 47 Goodwill and Intangible Assets The assets and liabilities of acquired businesses are recorded under the acquisition method of accounting at their estimated fair values at the date of acquisition.
We may be required to record additional inventory write-downs if actual market conditions are less favorable than those projected by our management. 41 Goodwill and Intangible Assets The assets and liabilities of acquired businesses are recorded under the acquisition method of accounting at their estimated fair values at the date of acquisition.
Off-Balance Sheet Arrangements On December 31, 2023, we did not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources.
Off-Balance Sheet Arrangements On December 31, 2024, we did not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources.
If the asset group’s carrying amount exceeds the sum of the undiscounted future cash flows, we would determine the fair value of the asset group and record an impairment loss in net earnings. Intangible assets balance as of December 31, 2023 and 2022 was $2.6 million and $11.5 million, respectively.
If the asset group’s carrying amount exceeds the sum of the undiscounted future cash flows, we would determine the fair value of the asset group and record an impairment loss in net earnings. Intangible assets balance as of December 31, 2024 and 2023 was $2.0 million and $2.6 million, respectively.
Additionally, as of December 31, 2023 the Company recorded an aggregate intangible assets impairment of $5.9 million, no intangible impairment was recorded for the same period on 2022. Share-Based Compensation Awards The value we assign to the options that we issue is based on the fair market value as calculated by the Black-Scholes pricing model.
Additionally, as of December 31, 2023 the Company recorded an aggregate intangible assets impairment of $5.9 million, no intangible impairment was recorded for the same period during the year ended December 31, 2024. 42 Share-Based Compensation Awards The value we assign to the options that we issue is based on the fair market value as calculated by the Black-Scholes pricing model.
See Notes 7, 10, 12 and 13 to the consolidated financial statements for amounts outstanding as of December 31, 2023, for these contractual obligations. 51 Inflation During the year ended December 31, 2023, inflation has had a negative impact on the unmanned aerial vehicle systems industry, our customers, and our business globally.
See Notes 6, 10, 12 and 13 to the consolidated financial statements for amounts outstanding as of December 31, 2024, for these contractual obligations. Inflation During the year ended December 31, 2024, inflation has had a negative impact on the uncrewed aerial vehicle systems industry, our customers, and our business globally.
The decline in revenues is mainly due to the eBee drone products of $3.6 million, to the RedEdge-P and Altum-PT™ panchromatic sensors of $1.6 million and $0.2 million of our SaaS subscription services related to our HempOverview and Ground Control platforms.
The decline in revenues is mainly due to the, RedEdge-P and Altum-PT™ panchromatic sensors of $0.4 million, $0.1 million of our SaaS subscription services related to our HempOverview and Ground Control platforms, offsetting with the increase of the eBee drone products of $0.2 million.
We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources.
We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Our actual results may differ from these estimates under different assumptions or conditions.
As of December 31, 2023 and 2022, our goodwill balance was $7.4 million and $23.2 million, respectively, after goodwill impairment charges recognized during the years ended December 31, 2023 and 2022 of $15,8 million and $41.7 million, respectively.
As of December 31, 2024 and 2023, our goodwill balance was $4.5 million and $7.4 million, respectively, after goodwill impairment charges recognized during the years ended December 31, 2024 and 2023 of $2.9 million and $15.8 million, respectively.
The decrease was primarily due to a reduction in headcount, travel, tradeshows, general marketing activities, along with a decrease in consulting expenses offset by an increase with in-person demos, particularly for the new ebee VISON . Impairment Goodwill Impairment For the twelve months ended December 31, 2023, goodwill impairment was $15.8 million.
The decrease was primarily due to a reduction in headcount, travel, tradeshows, general marketing activities, along with a decrease in consulting expenses offset by an increase with in-person demos, particularly for the new ebee VISON . Impairment Goodwill Impairment For the year ended December 31, 2024, goodwill impairment was $2.9 million.
Further, we utilized our cash in our operating activities of $11.0 million, a decrease of $8.8 million as compared to $19.8 million for the year ended December 31, 2022.
Further, we utilized our cash in our operating activities of $6.6 million, a decrease of $4.4 million as compared to $11.0 million for the year ended December 31, 2023.
As of December 31, 2023, the Company recorded an aggregate goodwill impairment charge of $15.8 million on the two impaired reporting units. This impairment charge is based on the excess carrying value of the reporting units over their fair values. As of December 31, 2022, we performed our annual goodwill impairment tests for our three reporting units.
This impairment charge is based on the excess carrying value of the reporting units over their fair values. As of December 31, 2023, we performed our annual goodwill impairment tests for our three reporting units.
General and Administrative Expenses For the year ended December 31, 2023, general and administrative expenses were $13.6 million as compared to $17.8 million for the prior year ended December 31, 2022, resulting in a decrease of $4.2 million, or 23.6%.
General and Administrative Expenses For the year ended December 31, 2024, general and administrative expenses were $9.6 million as compared to $13.6 million for the prior year ended December 31, 2023, resulting in a decrease of $4.0 million, or 29.4%.
Overall, the net loss decrease is primarily a result of a $27.9 million decrease in operating expenses from 2022 to 2023.
Overall, the net loss decrease is primarily a result of a $25.7 million decrease in operating expenses from 2023 to 2024.
Our core technological capabilities include robotics and robotics systems autonomy; advanced thermal and multispectral sensor design and development; embedded software and firmware; secure wireless digital communications and networks; lightweight airframes; small UAS (“sUAS”) design, integration and operations; power electronics and propulsion systems; controls and systems integration; fixed wing flight; flight management software; data capture and analytics; human-machine interface development and integrated mission solutions.
Our core technological capabilities include robotics and robotics systems autonomy; advanced thermal and multispectral sensor design and development; embedded software and firmware; secure wireless digital communications and networks; lightweight airframes; small UAS (“sUAS”) design, integration and operations; power electronics and propulsion systems; controls and systems integration; fixed wing flight; flight management software; data capture and analytics; human-machine interface development and integrated mission solutions. 36 The Company is currently headquartered in Wichita, Kansas, where we house our sensor manufacturing operations, and we manufacture drones in Lausanne, Switzerland.
Sales and Marketing For the twelve months ended December 31, 2023, sales and marketing expenses were $3.7 million as compared to $4.9 million for the twelve months ended December 31, 2022, a decrease of $1.2 million, or 24.5%.
Sales and Marketing For the year ended December 31, 2024, sales and marketing expenses were $2.4 million as compared to $3.7 million for the year ended December 31, 2023, a decrease of $1.3 million, or 35.1%.
During the twelve months ended December 31, 2023, we raised $8.8 million in equity from the additional sale of Series F Preferred Stock and Offering of our Common Stock and for the conversion of warrants.
During the year ended December 31, 2024, we raised $15.7 million in equity from the additional sale of Series F Preferred Stock and The Offering of our Common Stock, sales of common stock offering, and for the conversion of warrants of Series B.
Other Income (Expenses), net For the year ended December 31, 2023, other income, net for the Company created a loss of $3.3 million as compared to a $6.0 million profit for the year ended December 31, 2022.
Other Income (Expenses), net For the year ended December 31, 2024, other expenses, net for the Company reported a loss of $22.4 million as compared to a $3.3 million loss for the year ended December 31, 2023.
The impairment was primarily attributable to the goodwill related to our SaaS and the sensor reporting units, specifically due to lower sales compared to forecasted sales along with the declining market conditions.
The impairment was attributable to the goodwill related to our SaaS and sensor reporting units, specifically due to lower sales compared to forecasted sales along with the declining market conditions. Intangible Impairment The annual intangible impairment conducted during the fourth quarter of 2024 indicated no impairment.
As of December 31, 2023, we performed our annual goodwill impairment tests for our three reporting units. The results of our annual impairment test indicated that the fair value of the sensors reporting unit and the fair value of the SaaS reporting units were less than their carrying amount, indicating an impairment.
The results of our annual impairment test indicated that the fair value of the sensors reporting unit and the fair value of the SaaS reporting units were less than their carrying amount, indicating an impairment. As of December 31, 2023, the Company recorded an aggregate goodwill impairment charge of $15.8 million on the two impaired reporting units.
Net Loss For the year ended December 31, 2023, the Company incurred a net loss of $42.4 million as compared to a net loss of $58.3 million for the year ended December 31, 2022, a decrease in loss of $15.9 million or 27.3%.
Net Loss For the year ended December 31, 2024, the Company incurred a net loss of $35.0 million as compared to a net loss of $42.4 million for the year ended December 31, 2023, a decrease in loss of $7.4 million or 17.4%.
For the year ended December 31, 2023, cash provided by financing activities was $8.6 million a decrease of $8.9 million, or 50.9% as compared to cash provided of $17.5 million for twelve months ended December 31, 2022.
For the year ended December 31, 2024, cash provided by financing activities was $9.5 million an increase of $0.9 million, or 10.5% as compared to cash provided of $8.6 million for the year ended December 31, 2023.
For the drones, the declines are attributed to customer postponing drone purchases until the new eBee VISION is released and was released in December 2023; for the sensors, the declines are attributed to the challenge to secure financing for the component parts to meet demand while at the same time utilizing the operating capital to expedite the eBee VISION completion.
For the sensors, the declines are attributed to the challenge to secure financing for the component parts to meet demand while at the same time utilizing the operating capital to expedite the eBee VISION completion.
Please see Note 2 to our consolidated financial statements, which are included in Item 8 “Financial Statements and Supplementary Data” of this Annual Report, for our Summary of Significant Accounting Policies. There have been no material changes made to the critical accounting estimates during the periods presented in the consolidated financial statements.
We believe the following critical accounting estimates affect the more significant judgments and estimates used in preparing our consolidated financial statements. Please see Note 2 to our consolidated financial statements, which are included in Item 8 “Financial Statements and Supplementary Data” of this Annual Report, for our Summary of Significant Accounting Policies.
Finite-lived intangibles are amortized to expense over the applicable useful lives, ranging from five to ten years, based on the nature of the asset and the underlying pattern of economic benefit as reflected by future net cash inflows. We perform an impairment test of finite-lived intangibles whenever events or changes in circumstances indicate their carrying value may be impaired.
This impairment charge is based on the excess carrying value of the reporting units over their fair values. Finite-lived intangibles are amortized to expense over the applicable useful lives, ranging from three to ten years, based on the nature of the asset and the underlying pattern of economic benefit as reflected by future net cash inflows.
The decrease was primarily a result of the continued integration of the business acquisitions in 2021, which provided integration costs primarily from lease expenses due to combination of offices, reduction in employee payroll related costs due to integration of roles, ERP consulting integration costs, reduction in R&D consultants, less stock compensation costs offset by increased shareholder annual meeting costs. 49 Research and Development For the twelve months ended December 31, 2023, research and development expenses were $5.5 million as compared to $8.1 million for the twelve months ended December 31, 2022, a decrease of $2.6 million or 32.1%.
The decrease was driven by reduction in employee payroll related costs due to integration of roles, ERP consulting integration costs, less stock compensation costs offset by increased shareholder annual meeting costs. 43 Research and Development For the year ended December 31, 2024, research and development expenses were $4.0 million as compared to $5.5 million for the year ended December 31, 2023, a decrease of $1.5 million or 27.3%.
We intend to grow our business and preserve our leadership position by developing new drones, sensors and software and capturing a significant share of the global drone market. In addition, we expect to accelerate our growth and expansion through strategic acquisitions of companies offering distinct technological and competitive advantages and have defensible IP protection in place, if applicable.
In addition, we expect to accelerate our growth and expansion through strategic acquisitions of companies offering distinct technological and competitive advantages and have defensible IP protection in place, if applicable.
The decrease in cash used in operating activities was principally driven by lower sales and operating expenses which included significantly lower inventory purchases, prepaids, accounts payable, accrued expenses and contract liabilities.
For the year ended December 31, 2024, cash used in operations was $6.6 million, a decrease of $4.4 million, as compared to $11.0 million for the year ended December 31, 2023. The decrease in cash used in operating activities was principally driven by lower operating expenses which included significantly lower inventory purchases, prepaids, accounts payable, accrued expenses and contract liabilities.
We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.
We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders. 45 Contractual Obligations Material contractual obligations arising in the normal course of business primarily consist of principal and interest payments for loans made under the COVID program in Switzerland, defined benefit plan obligations, principal and interest payments for operating leases and other purchase obligations.
In addition, the eventual implications of higher government deficits and debt, tighter monetary policies and potentially higher, long-term interest rates may drive a higher cost of raising capital in the future.
In addition, the eventual implications of higher government deficits and debt, tighter monetary policies and potentially higher, long-term interest rates may drive a higher cost of raising capital in the future. Climate Change The drone industry is subject to many forms of environmental regulation, including but not limited to regulation of hazardous substances, and other risks associated with climate change.
We believe that by investing in complementary acquisitions, we can accelerate our revenue growth and deliver a broader array of innovative autonomous flight systems and solutions that address specialized market needs within our current target markets and in emerging markets that can benefit from innovations in artificial intelligence-enabled robotics and data capture and analytics. 43 Competitive Strengths AgEagle believes the following attributes and capabilities provide us with long-term competitive advantages: ● Proprietary technologies, in-house capabilities and industry experience – We believe our decade of experience in commercial UAS design and engineering; in-house manufacturing, assembly and testing capabilities; and advanced technology development skillset serve to differentiate AgEagle in the marketplace.
We believe that by investing in complementary acquisitions, we can accelerate our revenue growth and deliver a broader array of innovative autonomous flight systems and solutions that address specialized market needs within our current target markets and in emerging markets that can benefit from innovations in artificial intelligence-enabled robotics and data capture and analytics.
Revenue Recognition Most of the Company’s revenues are derived primarily through the sales of drones, sensors and related accessories, and software subscriptions. All contracts and agreements are a fixed price and are accounted for in accordance with ASC Topic 606, Revenue from Contracts with Customers .
All contracts and agreements are a fixed price and are accounted for in accordance with ASC Topic 606, Revenue from Contracts with Customers .
Critical Accounting Policies and Estimates Our management’s discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”).
If either we or any of our third parties in the supply chain for materials used in our manufacturing and assembly processes continue to be adversely impacted, our supply chain may be further disrupted, limiting its ability to manufacture and assemble products. 40 Critical Accounting Policies and Estimates Our management’s discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”).
For the year ended December 31, 2023, cash used in investing activities was $0.8 million, a decrease of $7.6 million as compared to $8.4 million for the year ended December 31, 2022.
For the year ended December 31, 2024, cash used in investing activities was $0.1 million, a decrease of $0.7 million as compared to $0.8 million for the year ended December 31, 2023. The decrease in cash used in our investing activities resulted mainly from a decrease in platform and internal-use software costs along with purchases of property and equipment.
All share-based awards are expensed on a straight-line basis over the vesting period of the options. 48 Results of Operations Year Ended December 31, 2023 as Compared to Year Ended December 31, 2022 Revenues For the year ended December 31, 2023, revenues were $13.7 million as compared to $19.1 million during the year ended December 31, 2022, a decrease of $5.4 million, or 28.3%.
Results of Operations Year Ended December 31, 2024 as Compared to Year Ended December 31, 2023 Revenues For the year ended December 31, 2024, revenues were $13.4 million as compared to $13.7 million during the year ended December 31, 2023, a decrease of $0.3 million, or 2.2%.
For the twelve months ended December 31, 2023, gross profit margin was 39.8% as compared to 43.0% for the twelve months ended December 31, 2022.
Gross Profit For the year ended December 31, 2024, gross profit was $6.3 million as compared to $5.5 million for the year ended December 31, 2023, an increase of $0.8 million or 14.5%. For the year ended December 31, 2024, gross profit margin was 47.0% as compared to 39.8% for the year ended December 31, 2023.
Liquidity and Capital Resources As of December 31, 2023, we had a working capital deficit of $0.5 million. For the year ended December 31, 2023, we incurred a loss from operations of $42.4 million, a decrease of $15.9 million, as compared to $58.3 million for the year ended December 31, 2022.
For the year ended December 31, 2024, we incurred a loss from operations of $12.6 million, a decrease of $26.5 million, as compared to $39.2 million for the year ended December 31, 2023.
For the twelve months ended December 30, 2022, we raised approximately $4.6 million of net proceeds from our ATM offering with co-agents Stifel, Nicolaus & Company, Incorporated and Raymond James & Associates. Our primary need for liquidity is to fund working capital requirements of our business, capital expenditures, acquisitions, debt service, and for general corporate purposes.
During the year ended December 31, 2023, we raised $8.6 million in equity from the additional sale of Series F Preferred Stock and Offering of our Common Stock and for the conversion of warrants. Our primary need for liquidity is to fund working capital requirements of our business, capital expenditures, acquisitions, debt service, and for general corporate purposes.
For the year ended December 31, 2023, cash used in operations was $11.0 million, a decrease of $8.8 million, as compared to $19.8 million for the year ended December 31, 2022.
Cost of Sales For the year ended December 31, 2024, cost of sales was $7.1 million as compared to $8.3 million during 2023, a decrease of $1.2 million, or 14.5%.
It inspires us to see around corners for our customers, understanding the problems they currently face or will be facing in the future, and delivering them solutions best suited for their unique needs. 42 ● Passion – this fuels our obsession with excellence, our desire to try the difficult things and tackle big problems, and our commitment to meet our customers’ needs – and then surpass them. ● Integrity – this is not optional or situational at AgEagle – it is the foundation for everything we do, even when no one is watching.
We expect to accomplish this goal by first bringing three core values to life in our day-to-day operations and aligning them with our efforts to earn the trust and continued business of our customers and industry partners: ● Innovation – committed to driving forward with positive change, our team is committed to innovate in technology, strategies, and cross-department initiatives. ● Passion – this fuels our obsession with excellence, our desire to try the difficult things and tackle big problems, and our commitment to meet our customers’ needs – and then surpass them. ● Integrity – this is not optional or situational at AgEagle – it is the foundation for everything we do, even when no one is watching.
Its coastal blue band – the first of its kind in the market – was specifically designed for vegetation analysis of water bodies; environmental monitoring; water management; habitat monitoring, protection and restoration; and vegetation species and weeds identification, including differentiating and counting plants, trees, invasive species and weeds.
Its coastal blue band – the first of its kind in the market – was specifically designed for vegetation analysis of water bodies; environmental monitoring; water management; habitat monitoring, protection and restoration; and vegetation species and weeds identification, including differentiating and counting plants, trees, invasive species and weeds. 38 ● We offer market-tested drones, sensors and software solutions that have earned the longstanding trust and fidelity of customers worldwide – Through successful execution of our acquisition integration strategy in 2022, AgEagle is now delivering a unified line of industry trusted drones, sensors and software that have been vigorously tested and consistently proven across multiple industry verticals and use cases.
The results of our annual impairment test indicated that the fair value of the sensors reporting unit exceeded its carrying amount, while the fair value of the SaaS and drones reporting units were less than their carrying amount, indicating an impairment.
As of December 31, 2024, we performed our annual goodwill impairment tests for our Sensor reporting unit. The results of our annual impairment test indicated that the fair value of the sensors reporting unit was less than their carrying amount, indicating an impairment. As of December 31, 2024, the Company recorded an aggregate goodwill impairment charge of $2.9 million.
The decrease in gross profit margin predominantly driven by significant price reduction in mid-Q2 to stimulate market demand and bring us in line specifically with competitive products manufactured in China and clearing out inventory to make way for the launch of the eBee VISION .
The increase in gross profit margin was a result of our drone products along with significant price reduction in the second and third quarter of 2023 to stimulate market demand and bring us in line specifically with competitive products manufactured in China. During the 2024 calendar year pricing of products stabilized increasing gross profit.
The decrease in cash provided by our financing activities was due to less sales of our Common stock through an at-the-market (“ATM”) offering and exercise of warrants in the prior year offset by the sale of Series F Preferred stock issuance of Common Stock and Warrant.
The increase in cash provided by our financing activities was due to exercise of Series B warrants, conversion of warrants issued with Series F shares, sale of Common stock and warrant liabilities and the sale of Series F Preferred stock. Liquidity and Capital Resources As of December 31, 2024, we had a working capital of $3.1 million.
Customer deposits represent customer prepayments and are recognized as revenue when the term of the sale or performance obligation is completed. The Company’s software subscriptions to its platforms, HempOverview and Ground Control , are offered on a subscription basis. These subscription fees are recognized ratably over each monthly membership period as the services are provided.
Contract liabilities are short-term in nature and are expected to be recognized in the next fiscal year. Customer deposits represent customer prepayments and are recognized as revenue when the term of the sale or performance obligation is completed.
Removed
AgEagle is led by a proven management team with years of drone industry experience and is currently headquartered in Wichita, Kansas, where we house our sensor manufacturing operations, and we operate our business and drone manufacturing operations in Raleigh, North Carolina. In addition, the Company operates business and manufacturing operations in Lausanne, Switzerland in support of our international business activities.
Added
We also operate a distribution and service center for our drone products in Raleigh, North Carolina. which supports our international business activities. We intend to grow our business and preserve our leadership position by developing new drones, sensors and software and capturing a significant share of the global drone market.
Removed
We expect to accomplish this goal by first bringing three core values to life in our day-to-day operations and aligning them with our efforts to earn the trust and continued business of our customers and industry partners: ● Curiosity – this pushes us to find value where others aren’t looking.
Added
Competitive Strengths AgEagle believes the following attributes and capabilities provide us with long-term competitive advantages: ● Proprietary technologies, in-house capabilities and industry experience – We believe our decade of experience in commercial UAS design and engineering; in-house manufacturing, assembly and testing capabilities; and advanced technology development skillset serve to differentiate AgEagle in the marketplace.
Removed
On September 6, 2023, the Company announced that commercial production of the eBee VISION had commenced and orders for the systems are now being accepted.
Added
Significant estimates include the reserve for obsolete inventory, stock options and consideration, valuation of intangible assets, fair value of derivative liabilities, and deemed dividends resulting from the triggering of down round provisions and modifications to equity-linked instruments.
Removed
In April of this year, AgEagle released Field Check for the Measure Ground Control mobile app. Measure Ground Control is a complete Software-as-a-Service solution for drone program management that is available as a web app and mobile app for both iOS and Android devices.
Added
There have been no material changes made to the critical accounting estimates during the periods presented in the consolidated financial statements. Revenue Recognition Most of the Company’s revenues are derived primarily through the sales of drones, sensors and related accessories, and software subscriptions.
Removed
The software’s capabilities include mission and equipment management, flight control, data processing and analysis, secure data storage and sharing, online collaboration and reporting. Field Check’s unique feature set enables users to review and validate the quality of their drone-captured imagery on-site.
Added
We perform an impairment test of finite-lived intangibles whenever events or changes in circumstances indicate their carrying value may be impaired.
Removed
Capturing target imagery right the first time in one trip to a project site allows users to eliminate time loss and costs associated with project reworks by ensuring data capture is complete and ready for processing into high-resolution outputs before leaving a site.
Added
All share-based awards are expensed on a straight-line basis over the vesting period of the options.
Removed
Reflecting our software development team’s superb problem-solving capabilities, Field Check provides our clients with a competitive edge in their drone operations and across the industries they serve by avoiding project repeats and downtime due to data processing errors or poor image quality. 44 ● We offer market-tested drones, sensors and software solutions that have earned the longstanding trust and fidelity of customers worldwide – Through successful execution of our acquisition integration strategy in 2022, AgEagle is now delivering a unified line of industry trusted drones, sensors and software that have been vigorously tested and consistently proven across multiple industry verticals and use cases.
Added
The primary factors contributing to the decrease in our cost of sales and the increase gross profit margin were due to the historical inventory adjustments and new bill of material system implementation.
Removed
If either we or any of our third parties in the supply chain for materials used in our manufacturing and assembly processes continue to be adversely impacted, our supply chain may be further disrupted, limiting its ability to manufacture and assemble products.
Added
The impairment was attributable to the goodwill related to our sensor reporting unit, specifically due to lower sales compared to forecasted sales along with the declining market conditions. For the year ending December 31, 2023, the company recorded a goodwill impairment of $15.8 million.
Removed
Significant estimates include the reserve for obsolete inventory, valuation of stock issued for services and stock options, valuation of intangible assets, and the valuation of deferred tax assets. On an ongoing basis, we evaluate our estimates and assumptions.
Added
The fluctuation of $19.1 million was primarily due to the $15.3 million on loss on equity financing, $1.6 million of loss on debt extinguishment, and $8.4 million interest on the Promissory Note and Note Payable, offset by the $3.1 million gain on change in fair value of warrant liabilities.
Removed
Our actual results may differ from these estimates under different assumptions or conditions. 46 We believe the following critical accounting estimates affect the more significant judgments and estimates used in preparing our consolidated financial statements.
Removed
As of December 31, 2022, the Company recorded an aggregate goodwill impairment charge of $41.7 million on the two impaired reporting units. This impairment charge is based on the excess carrying value of the reporting units over their fair values.
Removed
As a result, the Company experienced postponement or lost sales from delayed fulfillment. The deployment of capital from the sensor business and the reduction in workforce in the smaller revenue generating SaaS business contributed directly to the overall business decline in 2023 as management routed resources to expedite the eBee VISION launch and manage the sensor backlog.
Removed
Our continued innovation has demonstrated growth in our sales leading to strong demand of our products, specifically for our panchromatic sensor series, offsetting this growth are delays in our newly announced VISION drone product and Field Check for Measure Ground Control mobile app which we have just begun to deliver to marketplace.
Removed
Accordingly, our business continues to be negatively impacted by supply chain constraints, hawkish central bank activities, adverse labor market conditions and declining market valuation of our stock. Cost of Sales For the year ended December 31, 2023, cost of sales was $8.3 million as compared to $10.9 million during 2022, a decrease of $2.6 million, or 23.9%.
Removed
The primary factors contributing to the decrease in our cost of sales and the gross profit margin were due to the decline in revenues from our sensor and our drone products along with significant price reduction in mid-Q2 to stimulate market demand and bring us in line specifically with competitive products manufactured in China and clearing out inventory to make way for the launch of the eBee VISION.
Removed
In addition, our sensor sales continue to experience supply chain pressure, because of increases in raw components, labor costs and lack of process automation. Gross Profit For the twelve months ended December 31, 2023, gross profit was $5.5 million as compared to $8.2 million for the twelve months ended December 31, 2022, a decrease of $2.7 million or 32.9%.
Removed
In addition, our sensor sales continue to experience supply chain pressure, because of increases in raw components, labor costs and lack of process automation.
Removed
For the twelve months ended December 31, 2022, the company record a goodwill impairment of $41.7 million, which was primarily attributable to the goodwill impairment related to our SaaS and drones reporting units recorded in the fourth quarter of 2022.
Removed
This was due to lower sales compared to forecasted sales and profitability, a decline in market conditions, a decline in stock price and the delay in the eBee drone VISION launch.
Removed
The Company recorded an impairment charge to these two reporting units of $29.0 million and $12.7 million, respectively, during the fourth quarter and for the year ended December 31, 2022.

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