XWELL, Inc. Q2 FY2023 earnings call

• Scott mentioned the business had sequential revenue growth of approx. 15.7% and sequential reduction in operating expenses of approx. 13% in Q2 2023. Net loss in Q2 2023 was $5.7 million, a $2.2 million or 28% reduction vs same period 2022. Excluding currency adjustment, net loss would have been $4.5 million non-GAAP, a 43% reduction vs Q2 last year. - Spa business performing better with increases in staffing, new products/services leveraging tech. International airport spas strong due to new locations and increased passenger traffic. - Innovations include expanding with autonomous service providers: pilot with Clockwork expanded, autonomous manicures launched in Miami with plans for Orlando and Atlanta; autonomous massage chairs reduced payback from 7 weeks to 5 weeks. - Express Test business helping with national biosurveillance program, 8 passenger screening centers testing travelers, renewed partnership with CDC for $15.9 million contract. - Scott welcomed Suzanne Scrabis as new CFO, highlighted her experience. - Suzanne mentioned learning about the company, focusing on high-growth areas and improving efficiencies.

For the spa business, sales grew approximately 64% compared to the same 6-month period last year. International airport spas delivered net sales growth of approximately 30% compared to the same 6-month period last year. The spa business and Treat segments had a total product margin of 58%. The Express Test business had sequential revenue growth of 35% or $2.3 million in the second quarter. Spa business revenue contribution and Express Test business revenue contribution aren't explicitly given as percentages of total revenue, but the spa business's 64% growth and Express Test's 35% sequential growth are key absolute performance metrics.

• Plan to modify the frequency of earnings conference calls to 2 times a year, with year-end call in March 2024 and second quarter midyear update in August 2024. - Plan to get out on the road, host virtual investor roadshows and attend investor conferences to communicate strategy. - Filed a new shelf registration with the SEC for financial flexibility.

• Fluctuations in U.S. dollar exchange rates can impact reported results, e.g., unfavorable impact of converting Turkish lira from new spas in Turkey increased Q2 2023 net loss by approx. $1.1 million.