Company: CXAI
Filing Date: 2025-08-13
Form Type: 10-Q
Source: 0001829126-25-006141
Chunk: 50

Company: CXApp Inc.
Filing Date: 2025-08-13
Form: 10-Q
Item: Part I, Item 1
Chunk 50
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 costs. For the three
months ended June 30, 2025, total operating expenses were $5,163 thousand, compared to $5,063 thousand for the same period in 2024,
representing an increase of $100 thousand.

This increase was primarily driven by a $462 thousand
rise in R&D expenses, reflecting increased investment in platform enhancements, including those related to the Company’s strategic
relationship with Google. These efforts include development of deeper integrations with Google Workspace and AI infrastructure alignment
designed to optimize data analytics and employee experience features across joint enterprise deployments.

The increase in R&D was partially offset by
a $279 thousand decrease in sales and marketing expenses, as the Company reallocated go-to-market resources toward high-ROI enterprise
accounts and strategic channel partnerships. Additionally, G&A expenses decreased by $83 thousand, reflecting ongoing cost control
measures in administrative functions.

Management believes that these investments in
innovation and platform interoperability position the Company to scale its AI-native offerings while driving long-term operating leverage.

Other Income/Expense

Other income/expense was an income of $973 thousand
and an expense of $1,765 thousand for the three months ended June 30, 2025, and the three months ended June 30, 2024, respectively.
This increase of $2,738 thousand in other income for the comparative periods was attributable to an increase in the change in fair value
of derivative warrant liabilities of approximately $1,931 thousand, an increase in other income of approximately $286 thousand, and a
decrease in interest expense of approximately $521 thousand.

Provision for Income Taxes

There was $1 thousand income tax expenses for the three months ended June 30, 2025, compared to $159 thousand tax benefit for the six months ended June 30, 2024. The income tax benefit for the three months ended June 30, 2024 is primarily a result of the release of valuation allowance attributable to acquired intangible assets from the Business Combination recorded in the first quarter of 2023.

37

Non-GAAP Financial information

EBITDA

The Company includes a non-GAAP measure that we use to supplement our results presented in accordance with U.S. GAAP. EBITDA is defined as earnings before interest and other income, taxes, depreciation and amortization. Adjusted EBITDA is used by our management as the matrix in which it manages the business. It is defined as EBITDA plus adjustments for other income