- Algorhythm Holdings (RIME, Financial) reported a decline in Q1 2025 revenues to $2.0 million, a 16.7% decrease from $2.4 million in Q1 2024.
- The company's net loss widened to $9.2 million, notably impacted by $6.4 million in non-cash warrant-related expenses.
- The recent acquisition of SemiCab India is projected to significantly bolster revenue, potentially reaching $23 million in the second half of 2025.
Algorhythm Holdings, Inc. (RIME), an AI technology and consumer electronics holding company, announced its financial results for the first quarter of 2025, revealing a revenue decline to $2.0 million compared to $2.4 million in the same period last year. This revenue shrinkage is primarily attributed to reduced sales in its karaoke product line, which has been adversely affected by tariffs.
The company reported a net loss of $9.2 million for the quarter, a stark increase from the $2.4 million loss in Q1 2024. A significant portion of this loss, $6.4 million, was attributed to non-cash expenses related to a warrant liability from a previous public offering.
Despite the revenue decline, Algorhythm achieved an improved gross profit margin, which increased by 4.4% to reach 25.1%. The company's operating loss, however, expanded to $2.8 million from $2.3 million year over year.
A strategic pivot is underway for Algorhythm through its acquisition of SemiCab India, which operates a cloud-based AI logistics platform. This acquisition is expected to be a key growth driver, with an annualized revenue run rate currently at $4.6 million and projections to double by year-end. SemiCab has expanded its fleet to 140 trucks, with access to 450 additional vehicles, potentially increasing revenues to $23 million in the latter half of 2025.
Inventory management was a focus during the quarter, with inventory levels reduced by 14% from $2.2 million to $1.9 million, indicating efficient resource scaling as part of the company's strategic adjustments.
Algorhythm's cash reserves at the end of Q1 stood at $3.3 million, which, given the current financial trajectory, provides a limited operational runway without additional revenue enhancement or external financing. The company remains committed to its strategic shift towards AI logistics, aiming to expand its fleet to over 1,000 vehicles by the end of 2025 to leverage growing manufacturing trends in India driven by global tariff shifts.
