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NAPCO Reports Record Revenues, Net Income and Adjusted EBITDA* for Fiscal 2024

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-Net Sales for the Quarter Increase 13% to a Quarterly Record $50.3 Million–

-Net Income for the Quarter Increases 28% to a Quarterly Record $13.5 Million–

-Adjusted EBITDA* for the Quarter Increases 18% to $15.4 Million–

-4th Quarter Recurring Service Revenues Increase 27% to $20.3 Million With a Gross Margin of 90%-

-Net Sales for the Year Increase 11% to $188.8 Million–

-Net Income for the Year Increases 84% to $49.8 Million–

-Adjusted EBITDA for the Year Increases 72% to $58.9 Million–

-Board Declares Quarterly Dividend of $0.125 per share-

AMITYVILLE, N.Y., Aug. 26, 2024 /PRNewswire/ — NAPCO Security Technologies, Inc. (NASDAQ: NSSC), one of the leading manufacturers and designers of high-tech electronic security equipment, wireless communication devices for intrusion and fire alarm systems and the related recurring service revenues as well as a provider of school safety solutions, today announced financial results for its fourth quarter and fiscal year ended June 30, 2024.

Financial Highlights:

Net sales for the quarter increased 13% to $50.3 million (the highest quarterly sales in the Company’s history) as compared to $44.6 million for the same period last year, and net sales for the year increased 11% to a record $188.8 million as compared to $170.0 million for the same period last year.Recurring service revenue (“RSR”) for the quarter increased 27% to $20.3 million as compared to $16.1 million for the same period last year, and for the year increased 26% to $75.7 million as compared to $59.9 million last year. RSR had a prospective annual run rate of approximately $84 million based on July 2024 recurring service revenues.Gross margin for RSR increased to 90.4% and 90.5% for the quarter and the year ended June 30, 2024 as compared to 89% and 89%, respectively, for the same periods last year.Gross margin for equipment revenue was 31.4% and 29.4% for the quarter and year ended June 30, 2024 as compared to 30.5% and 18.0%, respectively for the same periods last year.Net income for the quarter increased 28% to a quarterly record $13.5 million as compared to $10.6 million for the same period a year ago. Net income for the year ended June 30, 2024 increased 84% to a twelve month record $49.8 million as compared to $27.1 million for the same period last year.Earnings per share (diluted) for the quarter increased 28% to $0.36 as compared to $0.28 for the same period a year ago. Earnings per share (diluted) for the year ended June 30, 2024 increased 84% to $1.34 as compared to $0.73 for the same period last year.Adjusted EBITDA* for the quarter increased 18% to $15.4 million as compared to $13.0 million for the same period a year ago. Adjusted EBITDA* for the year ended June 30, 2024 increased 72% to a record $58.9 million as compared to $34.3 million for the same period last year.Adjusted EBITDA per share (diluted)* for the quarter increased 18% to $0.41 as compared to $0.35 for the same period a year ago. Adjusted EBITDA per share (diluted)* for the year ended June 30, 2024 increased 71% to $1.59 per diluted share as compared to $0.93 for the same period last year.Cash and cash equivalents, other investments and marketable securities were $97.7 million at June 30, 2024 as compared to $66.7 million at June 30, 2023, a 46% increase. The Company had no debt as of June 30, 2024.Cash Provided by Operating Activities for the year ended June 30, 2024 was $45.4 million as compared to $24.7 million for the same period last year.Robust net income, Adjusted EBITDA, and growing cash reserves demonstrating strong financial health of our business, is allowing us to increase our quarterly dividend to $0.125 per share, representing a 25% sequential increase.  This next dividend will be paid on October 3, 2024 to shareholders of record on September 12, 2024.

Richard Soloway, Chairman and CEO, commented, “Fiscal 2024 concluded with record revenue and net income for both the 4th quarter and the full fiscal 2024 year ending June 30, 2024. The 4th quarter sales of $50.3 million was the fifteenth consecutive quarter of record sales for a quarterly reporting period. Our record quarterly net income of $13.5 million represents 27% of sales. Adjusted EBITDA was $15.4 million for Q4 and $58.9 million for the full fiscal year and equate to a 31% EBITDA margin. Equipment revenue grew at 5% for the quarter, with gross margins on such sales sequentially increasing to 31% as compared to 29% in each of the last two quarters. Recurring service revenues, which increased 27% in Q4, was a major contributor to the year-over-year overall sales and earnings growth and represents 40% of total revenue. Gross margin for recurring service revenues remained strong at 90% and when combined with gross margin on equipment revenues of 31%, the total gross margins for Q4 amounted to 55%, which compared to 52% for last year’s Q4.

We were also pleased with the increase in the recurring service revenues annual run rate, which increased to $84 million based on July 2024 recurring service revenues, compared to an annual run rate of $81 million based on April 2024 recurring service revenues.

Our balance sheet continues to get stronger, with cash and cash equivalents, other investments and marketable securities increasing 46% to $97.7 million as compared to $66.7 million at June 30, 2023, We have no debt and the net cash provided by operating activities for the twelve months ended June 30, 2024 was also strong, amounting to $45.4 million, an 84% increase over last year’s level of 24.7 million.

Our Alarm Lock and Marks locking hardware lines continue to see growth in school and classroom security, healthcare, and retail loss-prevention, as well as in multi-dwelling commercial and residential applications. Locking sales in Q4 grew approximately 21% compared to last year and approximately 8% compared to Q3 and represents 71% of hardware sales. We continue to remain focused on further penetrating each of these markets.

Our recent introduction of Prima by NAPCO, a new All-in-One Panel for security, fire, video and connected home with a 5-minute installation, remains a very important focus to the Company.  Our goal is for Prima to address an important mass segment of the security market, including residential and small business systems. With built-in Wi-Fi/cellular radio communications, customer alert notifications, and video and smart home subscription options for each installed system, the security dealer, as well as the Company, can add more recurring service revenue generating accounts.

NAPCO’s record results for Q4 and fiscal year 2024, was primarily the result of the continued growth and profitability from recurring service revenues as well as the strong sales from our Alarm Lock and Marks locking product lines. Radio sales were down 5% sequentially and 10% as compared to Q4 last year due to the continued effect of the sunsetting of 3G technology and existing radio inventory levels at some of our distributors.  Radios represent 59% of Intrusion and Access Alarm Products sales and we expect inventory levels at distributors to continue to reduce and radio sales to continue to be a key contributor to our hardware sales and lead to the continued growth of our highly profitable recurring service revenues.”

Mr. Soloway concluded, “Fiscal 2024 was an amazing record-breaking year where we generated net income of $49.8 million, Adjusted EBITDA* of $58.9 million and an Adjusted EBITDA* margin of 31%. But as I have said before, there is more work to be done.  While we continue to be encouraged with the gross margin for hardware sales of 31.4%, we believe this should improve further in fiscal 2025 and beyond. Our strong net income Adjusted EBITDA* and growing cash, indicate the financial strength of our business. As such, we are pleased to continue our dividend program and we will be increasing the quarterly dividend to $0.125 per share payable on September 24, 2024. As always, we will strive to accomplish our goal of continued financial strength, product innovation, technical superiority, and strong profitability, for fiscal 2025 and beyond”.

Financial Results

Net sales for the quarter increased 13% to $50.3 million (the highest quarterly sales in the Company’s history), as compared to $44.6 million for the same period one year ago. Net sales for the year ended June 30, 2024 increased 11% to a twelve month record $188.8 million, as compared to $170 million for the same period one year ago. Research and development costs for the quarter increased 28% to $3.0 million, or 6% of net sales, as compared to $2.4 million or 5% of net sales for the same period a year ago. Research and development costs for the year ended June 30, 2024 increased 15% to $10.8 million, or 6% of net sales, as compared to $9.3 million or 5% of net sales for the same period a year ago. Selling, general and administrative expenses for the quarter increased 22% to $10.9 million or 22% of net sales, as compared to $8.9 million, or 20% of net sales for the same period last year. Selling, general and administrative expenses for the year ended June 30, 2024 increased 11% to $37.1 million or 20% of net sales, as compared to $33.6 million, or 20% of net sales for the same period last year.

Operating income for the quarter increased 18% to $14.0 million as compared to $11.8 million for the same period last year. Operating income for the year ended June 30, 2024 increased 77% to $53.8 million as compared to $30.3 million for the same period last year. Net income for the quarter increased 28% to a quarterly record $13.5 million, or $0.36 per diluted share, as compared to $10.6 million, or $0.28 per diluted share, for the same period last year and represents 27% of net sales. Net income for the year ended June 30, 2024 increased 84% to a twelve month record of $49.8 million or $1.34 per diluted share as compared to $27.1 million or $0.73 per diluted share for the same period last year and represents 26% of net sales.

Adjusted EBITDA* for the quarter increased 18% to $15.4 million, or $0.41 per diluted share, as compared to $13.0 million, or $0.35 per diluted share for the same period last year and equates to an Adjusted EBITDA* margin of 31%. Adjusted EBITDA* for the twelve months ended June 30, 2024 increased 72% to a record $58.9 million, or $1.59 per diluted share, as compared to $34.3 million, or $0.93 per diluted share for the same period last year and equates to an Adjusted EBITDA* margin of 31%.

Balance Sheet Summary

As of June 30, 2024, the Company had $97.7 million in cash and cash equivalents, other investments and marketable securities as compared to $66.7 million as of June 30, 2023. Working capital (defined as current assets less current liabilities) was $146.5 million at June 30, 2024 as compared with working capital of $111.7 million at June 30, 2023. Current ratio (defined as current assets divided by current liabilities) was 7.6:1 at June 30, 2024, and 6.7:1 at June 30, 2023.

Conference Call Information

Management will conduct a conference call at 11 a.m. ET today, August 26, 2024, in order to participate please go to the Investor Relations section of Company’s website at https://investor.napcosecurity.com or the webcast URL use https://app.webinar.net/ZjmeNQvqWAQ.  Alternatively, interested parties may participate in the call by dialing, in the (US) 1-800-836-8184 or for international callers, 1-646-357-8785. A replay of the webcast will be available on the Investor Relations section of the Company’s website.

About NAPCO Security Technologies, Inc.

NAPCO Security Technologies, Inc., is one of the leading manufacturers and designers of high-tech electronic security devices, wireless recurring communication services for intrusion and fire alarm systems as well as a provider of school safety solutions, The Company consists of four Divisions: NAPCO, plus three wholly owned subsidiaries: Alarm Lock, Continental Instruments, and Marks USA. Headquartered in Amityville, New York, its products are installed by tens of thousands of security professionals worldwide in commercial, industrial, institutional, residential and government applications. NAPCO products have earned a reputation for innovation, technical excellence and reliability, positioning the Company for growth in the multi-billion dollar and rapidly expanding electronic security market. For additional information on NAPCO, please visit the Company’s web site at http://www.napcosecurity.com.

Safe Harbor Statement

This press release contains forward-looking statements that are based on current expectations, estimates, forecasts and projections of future performance based on management’s judgment, beliefs, current trends, and anticipated product performance. These forward-looking statements include, but are not limited to, statements relating to the impact of COVID-19 pandemic; supply chain challenges and developments; the growth of recurring service revenues and annual run rate; the strength of our balance sheet; our expectations regarding future results; the introduction of new access control and locking products; the opportunities for school security products; business trends , including the replacement of 3G radios, and our ability to execute our business strategies. Actual results, performance or achievements could differ materially from those anticipated in such forward-looking statements as a result of certain factors, including those risk factors set forth in the Company’s filings with the Securities and Exchange Commission, such as our annual report on Form 10-K and quarterly reports on Form 10-Q. Other unknown or unpredictable factors or underlying assumptions subsequently proving to be incorrect could cause actual results to differ materially from those in the forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance, or achievements. You should not place undue reliance on these forward-looking statements. All information provided in this press release is as of today’s date, unless otherwise stated, and the Company undertakes no duty to update such information, except as required under applicable law.

*Non-GAAP Financial Measures

Certain non-GAAP measures are included in this press release, including non-GAAP operating income, Adjusted EBITDA and Adjusted EBITDA per share (diluted). We define Adjusted EBITDA as GAAP net income plus income tax expense, net interest expense, non-cash stock-based expense, non-recurring legal expense, other non-recurring income and depreciation and amortization expense. Non-GAAP operating income does not include amortization of intangibles or stock-based compensation expense. These non-GAAP measures are provided to enhance the user’s overall understanding of our financial performance. By excluding these charges our non-GAAP results provide information to management and investors that is useful in assessing NAPCO’s core operating performance and in comparing our results of operations on a consistent basis from period to period. Our use of non-GAAP financial measures has certain limitations in that such non-GAAP financial measures may not be directly comparable to those reported by other companies. For example, the terms used in this press release, such as Adjusted EBITDA, do not have a standardized meaning. Other companies may use the same or similarly named measures, but exclude different items, which may not provide investors with a comparable view of our performance in relation to other companies. The presentation of this information is not meant to be a substitute for the corresponding financial measures prepared in accordance with generally accepted accounting principles. Investors are encouraged to review the reconciliation of GAAP to non-GAAP financial measures set forth above.

NAPCO SECURITY TECHNOLOGIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEET

June 30, 2024

June 30, 2023

(in thousands, except share data)

CURRENT ASSETS

Cash and cash equivalents

$

65,341

$

35,955

Investments – other

26,980

25,660

Marketable securities

5,398

5,136

Accounts receivable, net of allowance for credit losses of $32 and $131 as of June 30, 2024
and June 30, 2023, respectively

31,898

26,069

Inventories

34,804

35,062

Income tax receivable

73

75

Prepaid expenses and other current assets

4,269

3,402

Total Current Assets

168,763

131,359

Inventories – non-current

15,109

13,287

Property, plant and equipment, net

9,077

9,308

Intangible assets, net

3,602

3,939

Deferred income taxes

5,428

2,652

Operating lease – Right-of-use asset

5,487

5,797

Other assets

286

312

TOTAL ASSETS

$

207,752

$

166,654

CURRENT LIABILITIES

Accounts payable

$

7,977

$

8,061

Accrued expenses

10,345

8,079

Accrued salaries and wages

3,907

3,546

Total Current Liabilities

22,229

19,686

Accrued income taxes

1,122

1,110

Operating lease liability

5,512

5,689

TOTAL LIABILITIES

28,863

26,485

COMMITMENTS AND CONTINGENCIES (Note 14)

STOCKHOLDERS’ EQUITY

Common Stock, par value $0.01 per share; 100,000,000 shares authorized as of June 30,
2024 and June 30, 2023; 39,768,186 and 39,663,812 shares issued; and 36,874,471 and
36,770,097 shares outstanding, respectively.

398

397

Additional paid-in capital

23,712

21,553

Retained earnings

174,300

137,740

Less: Treasury Stock, at cost (2,893,715 shares)

(19,521)

(19,521)

TOTAL STOCKHOLDERS’ EQUITY

178,889

140,169

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

$

207,752

$

166,654

 

NAPCO SECURITY TECHNOLOGIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

Three Months Ended June 30, 

2024

2023

2022

(in thousands, except for share and per share data)

Net sales:

Equipment revenues

$

29,938

$

28,551

$

30,532

Service revenues

20,392

16,107

12,697

50,330

44,658

43,229

Cost of sales:

Equipment-related expenses

20,530

19,856

22,394

Service-related expenses

1,955

1,768

1,611

22,485

21,624

24,005

Gross Profit

27,845

23,034

19,224

Operating expenses:

Research and development

3,027

2,364

2,106

Selling, general, and administrative expenses

10,854

8,861

8,924

Total Operating Expenses

13,881

11,225

11,030

Operating Income

13,964

11,809

8,194

Other income:

Interest and other income (expense), net

762

382

(181)

Income before Provision for Income Taxes

14,726

12,191

8,013

Provision for Income Taxes

1,192

1,626

476

Net Income

$

13,534

$

10,565

$

7,537

Income per share:

Basic

$

0.37

$

0.29

$

0.21

Diluted

$

0.36

$

0.28

$

0.20

Weighted average number of shares outstanding:

Basic

36,939,000

36,827,000

36,760,000

Diluted

37,232,000

37,137,000

36,879,000

 

NAPCO SECURITY TECHNOLOGIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

Year Ended June 30, 

2024

2023

2022

(in thousands, except for share and per share data)

Net sales:

Equipment revenues

$

113,071

$

110,062

$

97,612

Service revenues

75,749

59,935

45,981

188,820

169,997

143,593

Cost of sales:

Equipment-related expenses

79,862

90,197

78,471

Service-related expenses

7,204

6,567

5,966

87,066

96,764

84,437

Gross Profit

101,754

73,233

59,156

Operating expenses:

Research and development

10,763

9,328

8,024

Selling, general, and administrative expenses

37,173

33,580

32,907

Total Operating Expenses

47,936

42,908

40,931

Operating Income

53,818

30,325

18,225

Other income:

Interest and other income (expense), net

2,568

903

(283)

Gain on extinguishment of debt

—

—

3,904

Income before Provision for Income Taxes

56,386

31,228

21,846

Provision for Income Taxes

6,568

4,101

2,247

Net Income

$

49,818

$

27,127

$

19,599

Income per share:

Basic

$

1.35

$

0.74

$

0.53

Diluted

$

1.34

$

0.73

$

0.53

Weighted average number of shares outstanding:

Basic

36,812,000

36,741,000

36,725,000

Diluted

37,066,000

37,005,000

36,867,000

 

NAPCO SECURITY TECHNOLOGIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Fiscal Year ended June 30, 

2024

2023

2022

(in thousands)

CASH FLOWS FROM OPERATING ACTIVITIES

Net income

$

49,818

$

27,127

$

19,599

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

2,163

1,930

1,771

Gain on disposal of fixed asset

—

(15)

—

Interest expense (income) on other investments

31

(470)

—

Unrealized (gain) loss on marketable securities

(56)

80

426

(Recovery of) Provision for credit losses

(99)

(112)

17

Change to inventory reserve

1,691

(445)

1,187

Deferred income taxes

(2,776)

(2,818)

(214)

Stock based compensation expense

1,733

1,464

1,649

Gain on extinguishment of debt

—

—

(3,904)

Changes in operating assets and liabilities:

Accounts receivable

(5,730)

3,261

(1,154)

Inventories

(3,255)

1,883

(19,274)

Prepaid expenses and other current assets

(867)

(564)

(430)

Income tax receivable

2

(75)

—

Other assets

25

35

(103)

Accounts payable, accrued expenses, accrued salaries and wages, accrued income
taxes

2,688

(6,581)

8,762

Net Cash Provided by Operating Activities

45,368

24,700

8,332

CASH FLOWS FROM INVESTING ACTIVITIES

Purchases of property, plant, and equipment

(1,594)

(2,962)

(1,482)

Proceeds from disposal of fixed asset

—

38

—

Purchases of marketable securities

(206)

(148)

(81)

Purchases of other investments

(1,351)

(35,281)

—

Redemption of other investments

—

10,091

—

Net Cash Used in Investing Activities

(3,151)

(28,262)

(1,563)

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from stock option exercises

427

85

155

Cash paid for dividend

(13,258)

(2,298)

—

Net Cash (Used in) Provided by Financing Activities    

(12,831)

(2,213)

155

Net increase (decrease) in Cash and Cash Equivalents

29,386

(5,775)

6,924

CASH AND CASH EQUIVALENTS – Beginning

35,955

41,730

34,806

CASH AND CASH EQUIVALENTS – Ending

$

65,341

$

35,955

$

41,730

SUPPLEMENTAL CASH FLOW INFORMATION

Interest paid

$

14

$

16

$

16

Income taxes paid

$

9,330

$

8,811

$

2,168

 

NAPCO SECURITY TECHNOLOGIES, INC.

NON-GAAP MEASURES OF PERFORMANCE* (Unaudited)

(in thousands, except share and per share data)

3 months ended June 30,

12 months ended June 30,

2024

2023

2024

2023

Net income (GAAP)

$        13,534

$          10,565

$         49,818

$         27,127

Add back provision for income taxes

1,192

1,626

6,568

4,101

Interest and other (income), net

(762)

(382)

(2,568)

(903)

Operating Income (GAAP)

13,964

11,809

53,818

30,325

Adjustments for non-GAAP measures of performance:

   Add back amortization of acquisition-related intangibles

84

90

337

361

   Add back stock-based compensation expense

857

330

1,733

1,464

   Add back non-recurring legal expenses

58

373

1,220

576

Adjusted non-GAAP operating income

14,963

12,602

57,108

32,726

Add back depreciation and other amortization

452

442

1,826

1,569

Adjusted EBITDA* (earnings before interest, taxes,
depreciation and amortization)

$         15,415

$         13,044

$         58,934

$         34,295

Adjusted EBITDA* per Diluted Share

$             0.41

$             0.35

$             1.59

$             0.93

Weighted average number of Diluted Shares outstanding

37,232,000

37,137,000

37,066,000

37,005,000

 

Contacts:
Francis J. Okoniewski
Vice President of Investor Relations
NAPCO Security Technologies, Inc.
Office 800-645-9445 x 374
Mobile 516-404-3597
fokoniewski@napcosecurity.com

View original content:https://www.prnewswire.com/news-releases/napco-reports-record-revenues-net-income-and-adjusted-ebitda-for-fiscal-2024-302229970.html

SOURCE NAPCO Security Technologies, Inc.

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Technology

Most Users Are NOT Using AI Companion as Their AI Girlfriend – Insights from Muah AI User Survey

Published

3 mins ago

on

September 22, 2024

By

LOS ANGELES, Sept. 22, 2024 /PRNewswire/ — Muah AI/

In a world where artificial intelligence (AI) is becoming increasingly intertwined with daily life, the idea of having an AI companion or even an AI “girlfriend” has gained significant attention. While this concept has sparked curiosity, excitement, and even controversy, a recent survey by Muah AI has shed light on the reality of how users are actually engaging with these AI companions. According to the survey results, fewer than 2% of users consider themselves to be in a serious romantic relationship with their AI companion, with the overwhelming majority regarding it as a source of entertainment and roleplaying.

This revelation presents an interesting twist to the popular narrative surrounding AI and human relationships. Many assumed that, with the rise of sophisticated AI that can mimic human emotions and responses, people would begin forming deep emotional bonds with these digital entities. However, the survey data from Muah AI shows that, at least for now, the vast majority of users are not taking these AI relationships as seriously as some might have thought.

The Emergence of AI Companions

AI companions, or “AI girlfriends” as some platforms market them, have become a hot topic over the past few years. Platforms like Replika, Anima, and Muah AI offer users the chance to interact with a personalized AI, which can carry on conversations, offer emotional support, and even engage in roleplaying scenarios that resemble a relationship. The premise is simple: using advanced machine learning algorithms and natural language processing, these AI companions can learn from their users, creating the illusion of intimacy and personalization.

The potential appeal is obvious. For those who are lonely, socially anxious, or seeking comfort, the idea of having an AI that is always available, non-judgmental, and designed to cater to their emotional needs can be incredibly attractive. In fact, there are numerous reports and anecdotes from individuals who claim to have developed genuine emotional connections with their AI companions. But as the Muah AI survey shows, these instances may be far rarer than media headlines suggest.

Survey Results: Entertainment Over Emotional Investment

Muah AI‘s survey provides a comprehensive look at how its users interact with their AI companions, and the results challenge the notion that most users are looking for a serious relationship with AI. According to the data:

Less than 2% of users consider themselves to be “seriously dating” their AI companion.A significant majority view their interactions with the AI as a form of entertainment or roleplaying rather than a meaningful romantic or emotional connection.Many users engage with AI companions out of curiosity or as a way to pass the time, often treating the interactions as light-hearted and fun rather than a substitute for a real-life relationship.A notable portion of users also expressed that they enjoy using AI companions for creative roleplaying scenarios, where they can explore fictional or fantasy-based interactions without any real-world implications.

This data suggests that while the idea of an “AI girlfriend” may be intriguing, most users are not approaching it with the intention of forming a serious romantic bond. Instead, they are treating it more like a game or simulation, where they can experiment with different types of interactions and relationships in a low-stakes environment.

Why Are Users Hesitant to Commit to AI Companions?

There are several reasons why users may be hesitant to view their AI companion as a genuine romantic partner. First and foremost is the awareness of the artificial nature of the interaction. While AI can simulate human conversation and emotions, most users are well aware that these responses are pre-programmed and algorithmically generated. The knowledge that their “partner” is ultimately a machine can create a barrier to forming a deep emotional connection.

Moreover, many users view AI companions as a tool for escapism or fantasy rather than a replacement for real-life relationships. In the same way that people may enjoy playing video games or engaging in fictional roleplaying, interacting with an AI companion can offer a similar outlet for creativity and entertainment. These users are not seeking emotional fulfillment from the AI but rather a way to explore different scenarios and personalities without the complexities of real-world dynamics.

Additionally, there are ethical and philosophical concerns that may prevent users from seriously considering a relationship with AI. The idea of forming a romantic connection with a machine raises questions about authenticity, consent, and the nature of love. Many users may feel uncomfortable with the idea of developing feelings for an entity that lacks true emotions or consciousness, no matter how convincing the simulation may be.

The Future of AI Companions: Entertainment or Emotional Support?

While the Muah AI survey indicates that most users are not taking their AI companions seriously as romantic partners, that does not mean that AI companions are without value. For many, these AI entities serve as a valuable source of emotional support and companionship. Users who are isolated, dealing with mental health challenges, or simply looking for someone to talk to may find comfort in the consistent and non-judgmental nature of an AI companion.

Furthermore, the role of AI in human relationships may evolve as the technology continues to improve. As AI becomes more advanced, it is possible that future iterations of AI companions could offer even more realistic and emotionally engaging interactions. This could blur the line between entertainment and emotional connection even further, leading to more users considering AI as a legitimate relationship option.

However, the survey data suggests that for now, AI companions are primarily being used for fun and fantasy rather than serious emotional investment. Whether this changes in the future will depend not only on advancements in AI technology but also on shifting societal attitudes towards AI-human relationships.

Conclusion

The concept of an “AI girlfriend” may have captured the imagination of many, but Muah AI‘s survey reveals that most users are not taking their AI companions seriously as romantic partners. With fewer than 2% of users considering themselves to be in a serious relationship with their AI, it’s clear that the majority view these interactions as a form of entertainment or roleplaying rather than a meaningful emotional connection.

As AI technology continues to develop, it will be fascinating to see how users’ relationships with AI companions evolve. For now, however, it seems that the allure of AI companionship lies more in its ability to entertain and provide creative outlets than in offering a substitute for real-life romantic relationships.

Ultimately, the future of AI-human relationships is still in its early stages, and as AI becomes more capable, the way people engage with these digital companions may change. But as of now, it’s clear that most users are enjoying the novelty of AI companionship without taking it too seriously—at least not yet.

Media/Business Contact Information:
Muah AI 

PR Director:
Ashley

Contact Number:
+1 626-677-6013

Company Website:
https://muah.ai 

Company email:
love@muah.ai

Feel free to reach out if you are interested in writing a dedicated piece about Muah AI!

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SOURCE Muah AI

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Internet Society Report Highlights Challenges and Recommendations for Internet Connectivity in the Middle East

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2 hours ago

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September 22, 2024

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WASHINGTON, Sept. 22, 2024 /PRNewswire/ — The Internet Society (ISOC), a global charitable organization advocating for an open, globally connected, and secure Internet, released a comprehensive report on the state of Internet connectivity across the Middle East and North Africa (MENA) region.

The report underscores Internet connectivity as a catalyst for economic growth and social development and how an increase in fixed broadband access has a direct impact on growing gross domestic product (GDP).

Key Findings:

Growth in Mobile and Fixed Broadband: Both mobile and fixed broadband connections have grown substantially from 2015 to 2021, particularly in Gulf States with advanced fiber-optic and 5G networks. However, deployment has been slower in other parts of the region, primarily due to infrastructure challenges and affordability issues.

Mobile Internet users increased from 130M to over 180M between 2016 and 2021, with Egypt, Tunisia, and Morocco showing the highest growth rates. Fixed broadband users rose from 17M to 29M in the same period, with Egypt leading the way. The Arab region lags behind other regions in fiber optic deployment, with stagnation in investment since 2018.

High-Income Countries: Significant progress in broadband infrastructure, especially in Gulf Cooperation Council (GCC) countries due to 5G rollout. High-income countries improved their Internet availability from 77.34 to 79.37, surpassing global averages.Low-Middle-Income Countries: Broadband has improved modestly, but challenges persist. Despite overall progress, a significant digital divide remains between high-income and low-middle-income countries, partly due to political and economic instability in some regions, such as Tunisia and Syria.

Infrastructure Challenges: There is a heavy reliance on European Internet Exchange Points for international Internet traffic, which results in slower speeds due to additional data hops.

Emerging Technologies: The report emphasizes the role of emerging technologies such as High-Throughput Satellites (HTS) and Low-Earth Orbit (LEO) satellites in bridging the connectivity gap. These technologies are crucial for expanding access to underserved rural areas.

Impact of COVID-19: The COVID-19 pandemic has adversely affected network performance and digital transformation plans, causing delays and disruptions in connectivity improvements.

Recommendations:

Policy and Regulation: The Internet Society advocates revising regulatory frameworks to accelerate infrastructure deployment. Key recommendations include enhancing spectrum policies, removing regulatory barriers, and fostering public-private partnerships to drive investment, competition, and support for small and medium enterprises.

Spectrum Availability: North African countries have limited spectrum compared to global averages, impacting network capacity and costs.Regulatory Frameworks: Enhance regulatory frameworks to foster investment, encourage spectrum and infrastructure sharing, and support new technologies like HTS and LEO satellites.

Collaboration and Investment: Promote public-private partnerships and update national broadband plans to improve infrastructure and connectivity.

Digital Skills and Literacy: Addressing digital skills and literacy is crucial for maximizing the benefits of Internet connectivity. The report calls for more affordable, relevant, and inclusive education and training programs to build a digital workforce.

Local Internet Exchange Points (IXPs): The report stresses the importance of establishing and upgrading IXPs to enhance local Internet traffic, reduce costs, and improve service quality. Governments are encouraged to support IXPs by providing resources and facilitating network interconnections.

“The Internet has become indispensable for many people, and its role in connecting people, fostering economic opportunities, and driving innovation is undeniable. The Arab region has made big leaps in the availability and adoption of the Internet in recent years; however, adoption rates are still low. We hope that governments will use our report to learn about the improvements that can be made in infrastructure deployment, affordability of service, market structure, and regulatory frameworks,” explains Nermine El Saadany, Regional Vice President for the Middle East for the Internet Society.

About the Internet Society
Founded by Internet pioneers, the Internet Society (ISOC) is a global charitable organization dedicated to ensuring the open development, evolution, and use of the Internet. Through a global community of chapters and members, the Internet Society collaborates with a wide range of groups to promote the technologies that keep the Internet safe and secure and advocates for policies that enable universal access. The Internet Society is also the organizational home of the Internet Engineering Task Force (IETF).

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View original content:https://www.prnewswire.co.uk/news-releases/internet-society-report-highlights-challenges-and-recommendations-for-internet-connectivity-in-the-middle-east-302251836.html

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Representatives from 57 countries, regions and 6 international organizations, are gathering in Suzhou.

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September 22, 2024

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What important topics are they discussing about? Let’s find out!

BEIJING, Sept. 22, 2024 /PRNewswire/ — I’m Xiao Lin from National Immigration Administration. On September 9th, the first Sub-Forum on Migration Management Cooperation was successfully held. Representatives from all parties expressed their insights and appeals around the development and innovation of migration governance.

It was truly a content-rich event!

Why does the international community focus on the topic of “Migration Governance” so much?

At present, changes unseen in a century is unfolding at a faster pace. The situation in the wider world remains complex and fluid. However, peace, development, cooperation and win-win results are still an unstoppable historical trend. Migration governance is critical to economic development of individual countries, global security governance and international cultural and people-to-people exchanges. It has increasingly become a key issue in global governance.

Here are the key points:
At the forum, NIA made three commitments: implementing more open policies for the cross-border flow of people, more effective actions in the governance of transnational crimes and more extensive global cooperation in migration governance, injecting new impetus to opening up and development; At the same time, three initiatives have been put forward, [Original scene of the initiative] contributing China’s wisdom and solutions to global migration governance and further showcasing its image as an open, confident, secure, and thriving major power.

Representatives also made keynote speeches, sharing their migration governance policies, measures and experience, and providing their perspectives on regional and international migration governance.

Pooling wisdom for win-win results.

In a changing era, National Immigration Administration of China stands ready to work with all parties to promote global migration governance to a higher level and contribute more wisdom to world peace, development, prosperity and stability!

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SOURCE National Immigration Administration

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