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SurgePays Announces Second Quarter 2024 Financial Results

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$5 Million Share Repurchase Authorized

BARTLETT, Tenn., Aug. 13, 2024 /PRNewswire/ — SurgePays, Inc. (NASDAQ: SURG) (“SurgePays” or the “Company”), a technology and telecom company focused on the underbanked and underserved, today announced its financial results for the second quarter ended June 30, 2024.

Management Commentary

Chairman and CEO Brian Cox commented on the quarter’s results, “The second quarter of 2024 begins a transition phase for SurgePays.  ACP funding has run out and there is no guarantee it will return.  Fortunately, in the first quarter we shored up our balance sheet and began implementing growth initiatives outside of the ACP program to continue to pursue our strategic goal of being one of the country’s largest providers of prepaid wireless and underbanked financial technology services.

“Second quarter sales of $15.1 million were about as expected, but were well below the first quarter 2024 revenues of $31.4 million and the year ago second quarter 2023 revenues of $35.9 million due to the ending of the government’s ACP funding in mid-May, which we knew was coming.  Both the first quarter of 2024 and the second quarter of 2023 had full ACP funding.

“Gross profits in the 2024 second quarter were a loss of ($3.4) million compared to a profit of $10.0 million in the year ago quarter as the original ACP funding ran out mid-quarter. Additionally, we made the strategic decision to have our balance sheet take on the funding to maintain continuity within our subscriber base for three main reasons: 

Congress could renew the ACP program at any time, and if we terminated service, we would have to go out and re-acquire customers from a standing start, which would cost tens of millions of dollars.If Congress delayed or didn’t fund the program, we had plan B to acquire a company with licenses to provide a similar wireless subsidy and offer our subscribers the option to remain on a free monthly plan subsidized by a sister program. This is in conjunction with incentivizing customers to switch to LinkUp Mobile, our non-subsidized prepaid wireless brand. We know how critical broadband service is in everybody’s life, and we believe it was simply the right thing to do. 

“We are in a transition phase and are looking to get back to generating positive free cash flow by the end of this year through the following initiatives:

Continue to grow our ACP revenue stream should Congress begin funding it again.Offer our ACP subscriber base a free monthly service plan utilizing the Lifeline program while enticing customers with a cost-saving LinkUp Mobile prepaid wireless plan.Scaling up our third-party wholesale transactions for other prepaid wireless company payments at convenience stores. We believe this initiative is necessary because it is a relationship gateway product for LinkUp Mobile activations and subscriber growth.Expand our offerings outside of wireless.  For instance, we recently launched our ClearLine customer engagement platform for convenience stores at last month’s RetailNOW Conference in Las Vegas.Expand product and service offerings to the same nationwide network of convenience stores we are building by exploring and executing prospective partnering or product distribution opportunities.Identify unique market opportunities that represent potential positive short-term cash flow.

“As we said last quarter, we knew that the ACP funding could run out, and we are not waiting around for Congress to provide additional funding. Many initiatives are underway to expand SurgePays’s footprint among the underbanked and underserved, who remain our key customers. We recognize that the expiration of ACP funding has adversely impacted our business and stock price. Therefore, we feel it’s an opportune time to announce a corporate stock buyback so our long-term investors know our interests are aligned. Until December 31, 2024, we will implement a buyback of up to $5 million (the “Maximum Amount”) of SurgePays common stock in the open market. Repurchases may be made from time to time at management’s discretion. The program will end upon the earlier of 6 months after the commencement of the program or the date upon which the Maximum Amount has been purchased and can be discontinued at any time. No shares have been repurchased under the program to date. There can be no assurance as to the timing or number of shares of any repurchases.”

Second Quarter 2024 Results Conference Call

SurgePays management will host a webcast at 5 p.m. ET / 2 p.m. PT to discuss these results. The live webcast of the call can be accessed on the company’s investor relations website at ir.surgepays.com, or by registering at the following link: Second Quarter Financial Results Call

Telephone access to the call will be available at 877-545-0320 (in the U.S.) or by dialing 973-528-0002 (outside the U.S.). Participant access code is 650138.

A telephone replay will be available approximately one hour following completion of the call until August 27, 2024. To access the replay, please dial 877-481-4010 (in the U.S.) or 919-882-2331 (outside the U.S.). Replay passcode is 51057.

Share Repurchase Authorization

As indicated above, SurgePays’s board of directors has authorized the company to repurchase up to $5 million of common stock through the open market until December 31, 2024.

About SurgePays, Inc.

SurgePays, Inc. is a technology and telecom company focused on the underbanked and underserved communities. SurgePays’ technology-layered platform empowers clerks at over 8,000 convenience stores to provide a suite of prepaid wireless and financial products to underbanked customers. SurgePays prepaid wireless companies provide services to over 250,000 low-income subscribers nationwide. The company ranks as the 345th fastest-growing tech company in North America according to the 2023 Deloitte Technology Fast 500. Please visit SurgePays.com for more information.

Cautionary Note Regarding Forward-Looking Statements

This press release includes express or implied statements that are not historical facts and are considered forward-looking within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act. Forward-looking statements involve substantial risks and uncertainties. Forward-looking statements generally relate to future events or our future financial or operating performance and may contain projections of our future results of operations or of our financial information or state other forward-looking information. In some cases, you can identify forward-looking statements by the following words: “may,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue,” “ongoing,” “attempting,” or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words.

Although we believe that the expectations reflected in these forward-looking statements such as regarding our market potential along with the statements under the heading Management Commentary are reasonable, these statements relate to future events or our future operational or financial performance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements including but not limited to, our plans to expand our prepaid wireless company and the stock buyback program,  our ability to retain our subscribers on a free monthly plan subsidized by a sister program, our ability to obtain a company that has the license to subsidize our subscribers through a sister program and our expanded service and offerings. Furthermore, actual results may differ materially from those described in the forward-looking statements and will be affected by a variety of risks and factors that are beyond our control, including, without limitation, whether the ACP is funded again, our ability to obtain a company that has the license to subsidize our subscribers through a sister program, statements about our future financial performance, including our revenue, cash flows, costs of revenue and operating expenses; our anticipated growth; and our predictions about our industry. The forward-looking statements contained in this release are also subject to other risks and uncertainties, including those more fully described in our filings with the Securities and Exchange Commission (“SEC”), including in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. The forward-looking statements in this press release speak only as of the date on which the statements are made. We undertake no obligation to update, and expressly disclaim the obligation to update, any forward-looking statements made in this press release to reflect events or circumstances after the date of this press release or to reflect new information or the occurrence of unanticipated events, except as required by law.

 SurgePays, Inc. and Subsidiaries

Consolidated Balance Sheets

30-Jun-24

31-Dec-23

(Unaudited)

Assets

Current Assets

Cash

$

38,434,580

$

14,622,060

Accounts receivable – net

1,412,177

9,536,074

Inventory

8,363,434

9,046,594

Prepaids and other

507,927

161,933

Total Current Assets

48,718,118

33,366,661

Property and equipment – net

221,075

361,841

Other Assets

Note receivable

176,851

176,851

Intangibles – net

1,799,716

2,126,470

Internal use software development costs – net

428,010

539,424

Goodwill

4,166,782

1,666,782

Investment in CenterCom

498,273

464,409

Operating lease – right of use asset – net

396,475

387,869

Deferred income taxes – net

2,835,000

Total Other Assets

7,466,107

8,196,805

Total Assets

$

56,405,300

$

41,925,307

Liabilities and Stockholders’ Equity

Current Liabilities

Accounts payable and accrued expenses

$

4,297,557

$

6,439,120

Accounts payable and accrued expenses – related party

499,853

1,048,224

Accrued income taxes payable

100,000

570,000

Deferred revenue

20,000

Operating lease liability

96,332

43,137

Note payable – related party

1,606,654

4,584,563

Total Current Liabilities

6,600,396

12,705,044

Long Term Liabilities

Note payable – related party

2,730,796

Notes payable – SBA government

474,758

460,523

Operating lease liability

317,470

356,276

Total Long Term Liabilities

3,523,024

816,799

Total Liabilities

10,123,420

13,521,843

Stockholders’ Equity

Common stock, $0.001 par value, 500,000,000 shares authorized 19,431,549 and 14,403,261 shares issued and outstanding, respectively

19,435

14,404

Additional paid-in capital

72,967,169

43,421,019

Accumulated deficit

(26,827,373

(15,186,203

Stockholders’ equity

46,159,231

28,249,220

Non-controlling interest

122,649

154,244

Total Stockholders’ Equity

46,281,880

28,403,464

Total Liabilities and Stockholders’ Equity

$

56,405,300

$

41,925,307

 

SurgePays, Inc. and Subsidiaries

Consolidated Statements of Operations

(Unaudited)

For the Three Months Ended June 30,

For the Six Months Ended June 30,

2024

2023

2024

2023

Revenues

$

15,085,699

$

35,886,433

$

46,514,834

$

70,662,876

Costs and expenses

Cost of revenues

18,528,774

25,860,705

41,775,243

52,942,665

General and administrative expenses

7,432,978

3,823,227

13,863,783

6,812,648

Total costs and expenses

25,961,752

29,683,932

55,639,026

59,755,313

Income (loss) from operations

(10,876,053)

6,202,501

(9,124,192)

10,907,563

Other income (expense)

Interest expense

(116,722)

(156,267)

(249,305)

(348,593

Other income

636,868

636,868

Gain on investment in CenterCom

17,711

10,713

33,864

43,742

Total other income (expense) – net

537,857

(145,554)

421,427

(304,851

Net income (loss) before provision for income taxes

(10,338,196)

6,056,947

(8,702,765)

10,602,712

Provision for income tax benefit (expense)

(2,547,000)

(2,970,000)

Net income (loss) including non-controlling interest

(12,885,196)

6,056,947

(11,672,765)

10,602,712

Non-controlling interest

(19,431)

90,955

(31,595)

90,379

Net income (loss) available to common stockholders

$

(12,865,765)

$

5,965,992

$

(11,641,170)

$

10,512,333

Earnings per share – attributable to common stockholders

Basic

$

(0.66)

$

0.42

$

(0.63)

$

0.74

Diluted

$

(0.66)

$

0.4

$

(0.63)

$

0.71

Weighted average number of shares outstanding – attributable to common stockholders

Basic

19,431,549

14,191,083

18,562,416

14,154,163

Diluted

19,431,549

15,076,466

18,562,416

14,811,785

The accompanying notes are an integral part of these unaudited consolidated financial statements

 

SurgePays, Inc. and Subsidiaries

Consolidated Statements of Changes in Stockholders’ Equity

For the Three and Six Months Ended June 30, 2024

(Unaudited)

Common Stock

Additional

Accumulated

Non-Controlling

Total

Paid-in

Stockholders’

Shares

Amount

Capital

Deficit

Interest

Equity

December 31, 2023

14,403,261

$

14,404

$

43,421,019

$

(15,186,203)

$

154,244

$

28,403,464

Stock issued for cash

3,080,356

3,081

17,246,913

17,249,994

Cash paid as direct offering costs

(1,395,000)

(1,395,000

Exercise of warrants – cash

1,860,308

1,861

8,797,396

8,799,257

Exercise of warrants – cashless

40,238

41

(41)

Stock issued for services

47,386

48

411,692

411,740

Recognition of stock based compensation – unvested shares – related parties

1,497,417

1,497,417

Recognition of stock-based compensation – related party

6,196

6,196

Non-controlling interest

(12,164)

(12,164

Net income

1,224,595

1,224,595

March 31, 2024

19,431,549

19,435

69,985,592

(13,961,608)

142,080

56,185,499

Recognition of stock based compensation – unvested shares – related parties

2,981,577

2,981,577

Non-controlling interest

(19,431)

(19,431

Net loss

(12,865,765)

(12,865,765

June 30, 2024

19,431,549

$

19,435

$

72,967,169

$

(26,827,373)

$

122,649

$

46,281,880

SurgePays, Inc. and Subsidiaries

Consolidated Statements of Changes in Stockholders’ Equity

For the Three and Six Months Ended June 30, 2023

(Unaudited)

Common Stock

Additional

Accumulated

Non-Controlling

Total

Paid-in

Stockholders’

Shares

Amount

Capital

Deficit

Interest

Equity

December 31, 2022

14,116,832

$

14,117

$

40,780,707

$

(35,804,106)

$

127,535

$

5,118,253

Stock issued for services

60,082

60

307,398

307,458

Recognition of stock based compensation – stock options

9,294

9,294

Non-controlling interest

(576)

(576

Net income

4,546,341

4,546,341

March 31, 2023

14,176,914

14,177

41,097,399

(31,257,765)

126,959

9,980,770

Stock issued for services

64,927

65

311,121

311,186

Recognition of stock based compensation – stock options

9,294

9,294

Exercise of warrants for cash

43,814

44

207,196

207,240

Non-controlling interest

90,955

90,955

Net income

5,965,992

5,965,992

June 30, 2023

14,285,655

$

14,286

$

41,625,010

$

(25,291,773)

$

217,914

$

16,565,437

 

SurgePays, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(Unaudited)

For the Six Months Ended June 30,

2024

2023

Operating activities

Net income (loss) – including non-controlling interest

$

(11,672,765)

$

10,602,712

Adjustments to reconcile net income (loss) to net cash provided by (used in) operations

Depreciation and amortization

467,520

467,519

Amortization of right-of-use assets

46,995

21,494

Amortization of internal use software development costs

111,414

64,530

Stock issued for services

411,740

618,644

Recognition of stock based compensation – unvested shares – related parties

4,478,994

Recognition of share based compensation – options – related party

6,196

18,588

Interest expense adjustment – SBA loans

19,750

Right-of-use asset lease payment adjustment true up

(97,346)

Gain on equity method investment – CenterCom

(33,864)

(43,742

Changes in operating assets and liabilities

(Increase) decrease in

Accounts receivable

8,123,897

(1,059,014

Inventory

683,160

(6,900,674

Prepaids and other

(345,994)

(56,131

Deferred income taxes – net

2,835,000

Increase (decrease) in

Accounts payable and accrued expenses

(4,641,563)

(1,351,218

Accounts payable and accrued expenses – related party

(49,380)

(270,665

Accrued income taxes payable

(470,000)

Installment sale liability – net

(1,668,744

Deferred revenue

(20,000)

(199,910

Operating lease liability

56,134

(19,329

Net cash provided by (used in) operating activities

(90,112)

224,060

Investing activities

Capitalized internal use software development costs

(281,304

Net cash used in investing activities

(281,304

Financing activities

Proceeds from stock issued for cash

17,249,994

Proceeds from exercise of common stock warrants

8,799,257

207,240

Cash paid as direct offering costs

(1,395,000)

Repayments of loans – related party

(746,104)

(467,385

Repayments on notes payable

(1,520,954

Repayments on notes payable – SBA government

(5,515)

(9,213

Net cash provided (used in) by financing activities

23,902,632

(1,790,312

Net increase (decrease) in cash

23,812,520

(1,847,556

Cash – beginning of period

14,622,060

7,035,654

Cash – end of period

$

38,434,580

$

5,188,098

Supplemental disclosure of cash flow information

Cash paid for interest

$

259,765

$

209,840

Cash paid for income tax

$

$

Supplemental disclosure of non-cash investing and financing activities

Reclassification of accrued interest – related party to note payable – related party

$

498,991

$

Exercise of warrants – cashless

$

41

$

Right-of-use asset obtained in exchange for new operating lease liability

$

98,638

$

Goodwill (ClearLine Mobile, Inc.)

$

2,500,000

$

The accompanying notes are an integral part of these unaudited consolidated financial statements

 

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Infidigit Welcomes Pinaki Gupta as an Advisor to Foster Leadership and Drive Strategic Growth

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MUMBAI, India, Dec. 26, 2024 /PRNewswire/ — Infidigit, an AI-enabled digital growth partner known for delivering exceptional results in SEO, CRO, and digital growth, welcomes Pinaki Gupta as Director – Strategy and Oversight. Pinaki’s vast experience in driving business transformation and fostering innovation will be instrumental in shaping Infidigit’s strategic direction and positioning the organisation for long-term success.

With a career spanning global enterprises such as Tata Interactive Systems and MPS Interactive and as the founder of Pisarto, a prominent home decor marketplace, Pinaki has consistently driven innovation and growth. His expertise will play a pivotal role in further scaling Infidigit’s vision and helping it explore untapped opportunities in the dynamic digital marketing ecosystem.

Sharing his thoughts, Pinaki Gupta, said, “Infidigit’s rise as a leader in digital marketing has been remarkable. Kaushal and his team have built an organisation with a strong culture of innovation and performance that truly sets them apart. I am excited to join Infidigit as an Advisor to bring a new perspective and help evaluate business opportunities and accelerate their growth journey. Together, we will focus on building strategic frameworks that ensure Infidigit continues to thrive in an evolving digital-first world.”

Kaushal Thakkar, Founder and Managing Director of Infidigit, said, “Pinaki and I share a long and fruitful professional history, during which I’ve consistently been impressed by his incisive strategic mind. His knack for challenging the status quo and driving transformative change makes him an ideal fit for Infidigit’s ambitious growth trajectory. We’re excited to leverage his mentorship as we reach new heights, fortify our leadership team, and continue delivering exceptional results for our clients.”

Infidigit, under Kaushal Thakkar’s leadership, has consistently set benchmarks in SEO, CRO, and digital growth strategies. With over 100 award-winning campaigns, Infidigit has delivered measurable results across industries. Pinaki’s addition to the leadership team further strengthens its mission of combining innovation, leadership, and performance to help businesses grow sustainably.

About Infidigit:

Infidigit, an AI-enabled digital growth partner, empowers top brands to achieve impactful results through SEO, ASO, CRO, and data-driven digital strategies. At the forefront of AI innovation in marketing, Infidigit is developing a SaaS product to further simplify SEO. With a proven track record of measurable success, Infidigit partners with startups, MSMEs, and enterprises across diverse industries, enabling them to thrive in the digital-first economy. Their commitment to excellence is underscored by over 100 award-winning campaigns recognized by prestigious platforms such as the SMX, APAC Search Awards, ET BrandEquity Shark Awards, Sparkies and Exchange4Media IDMA. Infidigit continues to set new standards in digital marketing, driving sustainable growth and unparalleled success for its clients.

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Logo: https://mma.prnewswire.com/media/2586856/Infidigit_Logo.jpg

 

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AU NOMO Credit Card: A Smart Way to Leverage Fixed Deposits

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AHMEDABAD, India, Dec. 26, 2024 /PRNewswire/ — AU Small Finance Bank (AU SFB) has unveiled its latest offering, the AU NOMO Credit Card, a groundbreaking financial product that allows individuals to access credit while still growing their savings. This innovative credit card leverages the power of Fixed Deposits (FDs) as collateral, providing cardholders with enhanced purchasing power without compromising their long-term savings goals.

The AU NOMO Credit Card enables users to use their fixed deposits to secure a credit limit, offering a unique opportunity for first-time credit card applicants or individuals wanting to build their credit scores responsibly. This solution particularly benefits those with limited documentation or a lack of traditional credit history.

Key Features of the AU NOMO Credit Card

Contactless Payments: Enjoy secure and seamless tap-and-pay transactions for daily purchases.Card Liability Protection: Safeguards user against unauthorized transactions, card skimming, and online fraud with comprehensive liability coverage.Reward Points Program: User can earn reward points on retail, utility, and insurance transactions to maximize the value of their spending.Milestone Rewards: Unlock additional rewards for meeting specific quarterly spending goals.Lounge Access Benefits: Get complimentary access to domestic airport and railway lounges, subject to meeting spending criteria.Fuel Surcharge Waiver: Save on fuel transactions within a specified range with a surcharge waiver.

Eligibility Criteria

Here’s what one must know for eligibility criteria for AU NOMO credit card: 

Age: 18 to 75 yearsCitizenship: Indian ResidentFixed Deposit: Creation and maintenance of a fixed deposit with AU Small Finance Bank

The AU NOMO Credit Card (Credit Card against FD) offers an easy and seamless application process with a digital interface, making it accessible to anyone looking to leverage their savings for immediate spending power. The card promises to meet the needs of those starting their credit journey and those seeking additional flexibility in their financial dealings.

The AU NOMO Credit Card redefines the traditional approach to credit by allowing users to continue earning interest on their Fixed Deposits while enjoying the purchasing power that comes with a credit card. Whether for essential daily expenses or significant purchases, the AU NOMO Credit Card perfectly balances saving and spending, empowering individuals to achieve their financial goals without compromise.

For more information on the AU NOMO Credit Card, visit https://www.aubank.in/personal-banking/credit-cards/nomo-credit-card

About AU Small Finance Bank

AU Small Finance Bank, one of India’s leading small finance banks, is committed to transforming banking by focusing on customer-centric services and a deep understanding of the Indian market. More details on AU Small Finance Bank and its financial products like credit cards can be found online.

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Treat Yourself to a New Christmas Experience by Self-Gifting viaim’s AI Recording Earbuds, Perfect for a More Pleasant and Efficient Workplace

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SINGAPORE, Dec. 26, 2024 /PRNewswire/ — As Christmas approaches, the concept of self-gifting has become more popular with top business executives to help them get into the holiday mood. Especially designed for the office, a gift of AI recording true wireless earbuds launched by viaim, an AI technology hardware company deeply rooted in the smart office sector, can improve work efficiency, thereby lifting the spirits and improving quality of life for busy workplace elites ahead of the busy and stressful holiday period.

The person who understands themselves best is themselves. It is in this spirit that viaim is encouraging people to give themselves some extra love and care during this holiday season because they deserve it. The Christmas self-gifting trend that has been gaining popularity in recent years sees people pay more and more attention to creating a higher quality life for themselves in their busy work lives. Especially towards the end of the year, consumers are choosing to treat themselves with practical and pleasant gifts for Christmas. Earbuds have become a solid choice for self-gifting because of their usefulness in multiple scenarios, allowing users to enjoy a quality listening experience during work meetings and holiday relaxation time.

The amazing features of the Viaim Nano+ and Viaim Air open-ear AI recording true wireless earbuds make them the perfect choice for self-gifting this Christmas

13 language transcription and real-time translation: During the Christmas holidays, many business professionals travel internationally with friends or spend the holidays with family in countries that don’t speak their native language. viaim headphones allow users to communicate with local people around the world, jumping the language barrier and making cross-border communication smoother and the journey more interactive, fun, and memorable.VIAIM AI Smart Assistant: Generate Summaries and To-Do Lists with one click to help quickly complete an annual report or New Year’s business plan, allowing the festive atmosphere to be enjoyed without missing any key points.Flash Record function: Whether it is to conceive new ideas for next year’s project or suddenly think of a perfect Christmas gift list, inspiration during the holidays is often fleeting. Long press the viaim earbuds for one-click flash recording to capture ideas as soon as the spark of inspiration comes to mind.Noise reduction and a comfortable wearing experience: High-quality 45db noise reduction can provide users with a moment of quietness at Christmas parties, and the comfortable and lightweight design is suitable for long-term wear, meaning a quiet and enjoyable listening atmosphere can be enjoyed during the holidays.

Cecile from VIAIM shared: “Christmas is the time of year to relax and be grateful. It is of course a time to give gifts and be generous to others, but we also must remember to be kind to the person that knows us best – ourselves. Through our brand vision of “work smarter, not harder,” we hope to help people find their own special holiday moments in their busy work life by using our super-efficient office earbuds, so that everyone can enjoy a more productive and enjoyable life experience. I would like to personally wish all our customers, both new and old, a peaceful, relaxing, and happy Christmas.”

About VIAIM

VIAIM is an innovative technology company in the consumer-goods sector. With a focus on versatile, multimodal interactions, we strive to provide effective solutions that meet users’ specific needs. By harnessing state-of-the-art technology, we bring our visionary ideals to life, helping people embrace the incredible possibilities the Company offers.

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