Innovative Eyewear 2nd Q24 Revenue increased 82%

The information contained within this announcement is deemed by the Company (Companies House registration number 08873361) to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). With the publication of this announcement via a Regulatory Information Service ("RIS"), this inside information is now considered to be in the public domain.

13 August 2024

Tekcapital Plc

("Tekcapital", the "Company" or the "Group")

Innovative Eyewear, Inc. Reports Second Quarter 2024 Financial Results  

       Quarterly Revenue Increased 82% vs Q2 2023      

Tekcapital Plc (AIM: TEK), the UK intellectual property investment group notes that Innovative Eyewear, Inc. ("Innovative Eyewear") (NASDAQ: LUCY; LUCYW), the developer and retailer of ChatGPT enabled smart eyewear under the Lucyd®, Nautica®, Eddie Bauer® and Reebok® brands, announced today its Second Quarter 2024 Financial Results which can be accessed on www.sec.gov.   

Net revenue for the quarter ended June 30, 2024 was $308,682, an increase of 82% from the quarter ended June 30, 2023. Net revenue for the six months ended June 30, 2024 was $692,153, an increase of 120% vs the comparable period in 2023. These year-over-year increases were primarily attributable to significant volume growth in the ecommerce channel, driven by Innovative Eyewear's strategic advertising and marketing initiatives implemented during the latter portion of 2023 and through the current period, combined with recent new product launches (including the Lyte XL, Nautica® Powered by Lucyd and Eddie Bauer® Powered by Lucyd collections).

Additionally, Innovative Eyewear's gross profit margins significantly improved from the prior year, from a deficit of -18% in the second quarter of 2023 to 18% in the second quarter of 2024, reflecting greater economies of scale coupled with achieving management's stated goal to reduce lens fulfilment costs.

Eddie Bauer® Horizon Model

Word's first rimless smart eyewear

Photo courtesy of Innovative Eyewear, Inc.

During the quarter Innovative Eyewear announced several important milestones:

•     Expanding Innovative Eyewear's first-to-market voice interface for ChatGPT through the launch of a Bixby app called LUCY to enable handsfree ChatGPT access on its glasses for Samsung users. This brings a powerful new feature to Samsung phone users for the first time, namely the ability to access ChatGPT via the device's native voice assistant from our eyewear.

•     Filed two new United States patent applications, a utility application, No. 18/605,092, entitled, "SMART EYEWEAR HAVING ACCESSIBLE TACTILE CONTROLS" and a design application, No. 29/930,655, entitled "SAFETY EYEWEAR." These two new patent applications are directed towards Innovative Eyewear's new Lucyd Armor smart safety glasses which are planned to be introduced later this year. Innovative Eyewear developed Lucyd Armor to meet the needs of industrial and medical safety glass users in response to multiple customer requests. Innovative Eyewear also received notices of allowance on three smart eyewear design patent applications (patent application Nos. 29/806,204, 29/806/207, 29/806/209).

•     Launch of Lucyd smart eyewear in ten select New Look stores in Quebec and on NewLook.ca. New Look is a leading eyewear retailer with over 450 stores in the US and Canada.

•     Innovative Eyewear signed a new distribution agreement with Windsor Eyes, a leading eyewear manufacturing and distribution firm. This agreement aims to forge a robust collaboration between Innovative Eyewear's unique, cutting-edge smart eyewear products and Windsor Eyes' well-established distribution network within the optical retail sector. Together, Innovative and Windsor intend to work closely to ensure extensive distribution of smart eyewear across the United States, targeting key large optical retail outlets.

•     Signed Micah Richards, former Olympic athlete, premier-league footballer and Sky News announcer, as a brand ambassador. Innovative Eyewear believes Mr. Richards will be a well-aligned headliner to promote the upcoming Reebok Powered by Lucyd collection, and spearhead efforts to expand sales in UK optical stores.

•     PCMag.com rated Innovative Eyewear's products the "Best Smart Eyewear for ChatGPT Super Fans," indicating a positive reception from a trusted tech news source for our GenAI featured eyewear.

•     Innovative Eyewear engaged a new audio engineering team to further enhance the music and call quality of several of its forthcoming products.

Commercial Outlook

After the recent successful launch of the Eddie Bauer® Powered by Lucyd line in the second quarter of 2024, Innovative Eyewear anticipates launching the Reebok® Powered by Lucyd line and the Lucyd Armor smart safety glasses in the second half of 2024, to be followed by a Reebok® Optical Smart Eyewear collection in the first half of 2025.

Meanwhile, Innovative Eyewear is focused on introducing Lucyd products in major national retailers, which they believe could have a significant positive impact on revenues in subsequent periods. To help achieve this, Innovative Eyewear has engaged Windsor Eyes as a premier distributor in the optical market, and as of July 2024, they have already helped introduce Lucyd frames into three new eyewear retailers.

In continuing efforts to reduce costs and improve margins, Innovative Eyewear has refined its product mix and anticipates reducing unit costs in the future by focusing on high volume, market-tested styles. Innovative Eyewear has also recently contracted with a new lower-cost lens supplier which is expected to further reduce lens costs beginning in the third quarter of 2024. Innovative Eyewear anticipates that gross profit margins may further improve in the fourth quarter of 2024 as the new Lucyd Armor and Reebok® Powered by Lucyd lines are launched, as the unit cost of these new products are estimated to be significantly lower than current Lucyd Lyte models.

Innovative Eyewear has nearly completed development of several new product lines and retail solutions to be launched in the fourth quarter of 2024 and 2025 and anticipates an end-to-end enhancement of its product offering to consumers and retailers by the first quarter of 2025. They believe this will bring additional improvements to product build quality and adjustability, sound quality, size and style variety, custom lens quality, companion app functionality, and sell-through rates of retail displays.

Harrison Gross, CEO of Innovative Eyewear Inc., commented:

"We have continued the trend of outperforming each quarter on a year-over-year basis, which we have done every quarter for the last 12 months. I am pleased by our continued growth and excited by the potential of further expansion later this year with the upcoming launches of new product lines and upgraded app releases.

While our ecommerce direct-to-consumer sales remain the most material portion of our sales to date, we believe that the wholesale optical channel represents a significant growth opportunity. We anticipate that as smart eyewear becomes more normalized for prescription wear, national eye care providers will begin to onboard more smart eyewear. As an innovator and value and variety leader in the category, we believe we are well positioned to earn a portion of this rapidly growing market."

About Innovative Eyewear, Inc.

Innovative Eyewear is a developer and retailer of cutting-edge smart eyewear, under the Lucyd^®, Nautica^®, Eddie Bauer^® and Reebok® brands. True to their mission to Upgrade Your Eyewear^®, their Bluetooth audio glasses allow users to stay safely and ergonomically connected to their digital lives, and are offered in hundreds of frame and lens combinations to meet the needs of the optical market. To learn more and explore our continuously evolving collection of smart eyewear, please visit www.lucyd.co.

Tekcapital currently owns 259,455 shares (approximately 17%) of Innovative Eyewear, Inc.

Tekcapital's percentage ownership has been reduced as a result of Innovative Eyewear Inc raising approximately $6m during 2024. Tekcapital views the enhanced balance sheet of Innovative Eyewear Inc. as a positive development for the Company as it strengthens its competitive position.

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About Tekcapital plc

Tekcapital creates value from investing in new, university-developed discoveries that can enhance people's lives and provides a range of technology transfer services to help organisations evaluate and commercialise new technologies. Tekcapital is quoted on the AIM market of the London Stock Exchange (AIM: symbol TEK) and is headquartered in the UK. For more information, please visit www.tekcapital.com.

LEI: 213800GOJTOV19FIFZ85

Forward-Looking Statements

This press release is for informational purposes only. The information herein does not constitute investment advice nor an offer to invest and may contain statements related to our future business and financial performance and future events or developments involving Innovative Eyewear, Inc., Lucyd or Tekcapital that may constitute forward-looking statements. These statements may be identified by words such as "expect," "look forward to," "anticipate" "intend," "plan," "believe," "seek," "estimate," "will," "project" or words of similar meaning. We may also make forward-looking statements in other reports, in presentations, in material delivered to customers, stakeholders and in press releases. In addition, our representatives may from time to time make oral forward-looking statements. Such statements may be based on the current expectations and certain assumptions of Tekcapital, Innovative Eyewear Inc. or Lucyd's management. Please note that these are subject to a number of risks, uncertainties and factors, including, but not limited to those described in various disclosures. Should one or more of these risks or uncertainties materialize, or should underlying expectations not occur or assumptions prove incorrect, actual results, performance or achievements of Innovative Eyewear Inc., Lucyd and/or Tekcapital may vary materially from those described explicitly or implicitly in the relevant forward-looking statement. Other than as required by relevant regulation or law,  neither Innovative Eyewear Inc, Lucyd nor Tekcapital intends, nor assumes any obligation, to update or revise these forward-looking statements in light of developments which differ from those anticipated.