Rekor Systems (NASDAQ: REKR) Q3 Results – Company Reports Continued Quarterly Revenue Growth, Revenue CAGR Of 268% Over 2018-2022

Finbold's data indicates that the AI industry had a market size of $207.9 billion in 2023. By 2030, this market is expected to skyrocket by 788.64%, reaching an unprecedented $1.87 trillion. The growth trajectory is projected to surpass the $1 trillion mark in 2028, presenting a unique opportunity for investors looking to tap into a highly profitable industry.

Rekor Systems REKR, a prominent player in roadway intelligence AI solutions, recently reported Q3 results, demonstrating the potential of AI technology to revolutionize various industries and serve as a lucrative opportunity for investors. Rekor is renowned for its AI-driven digital infrastructure operating system, Rekor OneTM. This system gathers vast amounts of data from various sources, utilizing it to improve transportation systems and create efficient and safe roadways. It can access data from its own IoT roadside sensors, as well as incorporate third-party data sources like Waze, proprietary data capture, and existing infrastructure information. Through Rekor One, customers can utilize these data points to make informed decisions regarding infrastructure investments.

According to the company, there are currently no strong competitors in the field of AI roadway intelligence, and the transportation infrastructure market is expected to witness significant growth. In 2021, the transportation infrastructure market was valued at $1.7 trillion, and it is projected to grow at a compound annual growth rate of 7.2% from 2022 to 2031, reaching a total market size of $3.6 trillion.

The company has been experiencing revenue growth, with revenues growing at a compound annual growth rate (CAGR) of 268% over 2018-2022. This demonstrates the company's success over time in a highly competitive industry.

In Q3 2023, Rekor achieved a record gross revenue of $9.1 million, representing a 35% increase compared to $6.8 million in Q3 2022. Additionally, the company's performance obligations increased by 41% to reach $30.2 million as of September 30, 2023, compared to $21.4 million as of December 31, 2022. These figures highlight the strength of the company's customer base and its ability to retain them over time.

The company also signed contracts worth a total value of $8.4 million in Q3 2023, a 74% increase compared to $4.8 million in the same quarter of 2022. This increase in contract value demonstrates the company's capability to secure new customers and expand its market share. The company's profitability also improved, with an Adjusted EBITDA loss reduced from $10.7 million in Q3 2022 to $6.6 million in Q3 2023. This underscores the company's ability to manage costs and its trajectory to profitability.

Eyal Hen, CFO of Rekor shared, "In the third quarter of 2023, we have maintained our impressive revenue growth trend while simultaneously reducing our losses and cash burn. We achieved record quarterly and nine-month revenues in 2023, all while continuing our efforts to expand our market presence and making further investments in our AI technology. This remarkable progress underscores our success in realizing our strategic vision.”

The promising future of AI – expected to exceed $1 trillion by 2028 – indicates that AI is here to stay and redefine life as we know it. Rekor, with its exclusive systems, seems poised to capitalize on this rapid industry growth and maintain its revenue trajectory. The company's cutting-edge artificial intelligence, machine learning technologies, and IoT Edge devices present a distinctive chance for ongoing operational learning, propelling the digitalization of road networks in the United States and beyond.

Featured photo by Aleksandr Popov on Unsplash

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