Updates 2023 Revenue Guidance to $25-$30 Million
HOUSTON – May 12, 2023 – Freight Technologies, Inc. (Nasdaq: FRGT) (“Fr8Tech”), a technology company offering its custom-developed Fr8App, an industry-leading freight-matching platform powered by AI and machine-learning that offers a real-time portal for B2B cross-border and domestic shipping within the USMCA region, today reports first quarter 2023 revenue for the quarter ended March 31, 2023.
Fr8Tech reported preliminary revenue of $3.3 million for Q1 2023, down from a strong $5.3 million for Q1 prior year 2022. The Q1 year-over-year revenue decline was caused by a temporal decline in capacity available to the Fr8fleet during the first quarter in Mexico versus the prior year, the loss of a key cross-border account during the latter part of 2022 and the discontinuation of a strategic alliance in the US in favor of pursuing higher margin opportunities. As exemplified by a number of leading logistics companies results during the first quarter of 2023, the freight markets during the first quarter of 2023 tended to report lower margins and lower sales versus a year ago period in what is a very challenging market. While the market conditions in 2023 were more difficult than a year ago, and the company struggled with securing carrier capacity, management reiterated that it had its best month of new shipper client additions to its platform during the month of March 2023 and that the remainder of the year looks favorable in comparison to Q1 and to 2022.
Javier Selgas, CEO of Fr8Tech, said, “We had a very good Q1 a year ago. In contrast, this last quarter we had difficulty with securing capacity in a very tight carrier market during Q1 of this year and also suffered from some one-time client losses which makes year-over-year comparisons difficult. We also discontinued efforts to pursue some of our US domestic business in favor of focusing on higher margin and higher growth opportunities in other segments in which we operate which we are convinced is the appropriate tactical move for us at this stage. A selection of our routes in the US showed that rates were on average 25% lower than a year ago whereas our rates in Mexico and cross-border are faring much better. Our sales team has focused on successfully broadening our shipper base and we continue to work to increase our carrier base on Fr8App. Our Fr8Now project is only now starting to show some results and we are confident it will continue to grow throughout the year and into next. As previously announced, in spite of a challenging market so far this year, we are pleased with our record rate of signing up of new shippers in March, which gives us confidence in adjusting our 2023 revenue guidance for the year to $25-$30 million.”
About Freight Technologies Inc.
Freight Technologies (Nasdaq: FRGT) (“Fr8Tech”) is a technology company developing solutions to optimize and automate the supply chain process. Its wholly owned subsidiary Freight App, Inc. (“Fr8App”) is a B2B cross-border shipping marketplace in the USMCA region powered by AI and machine learning. Focused on making shipping transparent and efficient, Fr8App provides carriers with increased growth opportunities and shippers with flexibility, visibility and simplicity for the once-complex process of international over-the-road (“OTR”) shipping. Fr8App uses its proprietary technology platform to connect carriers and shippers and significantly improve matching and operation efficiency via innovative technologies such as live pricing and real-time tracking, digital freight marketplace, broker, transportation management, fleet management and committed capacity solutions. The company is headquartered in Houston, Texas.
For more information, please visit: www.fr8technologies.com
This press release includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Freight Technologies’ and Fr8App’s actual results may differ from their expectations, estimates and projections and, consequently, readers should not rely on these forward-looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “continue” and similar expressions (or the negative versions of such words or expressions) are intended to identify such forward-looking statements. These forward-looking statements include, without limitation, Freight Technologies’ and Fr8App’s expectations with respect to future performance and anticipated financial impacts of its acquisition of Fr8App.
These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from those discussed in the forward-looking statements. Most of these factors are outside Freight Technologies’ and Fr8App’s control and are difficult to predict. Factors that may cause such differences include, but are not limited to: (1) the impact of the COVID-19 pandemic on Fr8App’s business; (2) the inability to obtain or maintain the listing of Freight Technologies’ ordinary shares on Nasdaq; (3) the ability to recognize the anticipated benefits of the merger, which may be affected by, among other things, competition and the ability of Fr8App to grow, manage growth profitably and retain its key employees; (4) costs related to the merger; (5) changes in applicable laws or regulations; (6) the possibility that Freight Technologies or Fr8App may be adversely affected by other economic, business and/or competitive factors; (7) risks relating to the uncertainty of the projected financial information with respect to Fr8App; (8) risks related to the organic and inorganic growth of Fr8App’s business and the timing of expected business milestones; and (9) other risks and uncertainties identified, including those under “Risk Factors,” to be filed in Freight Technologies’ other filings with the SEC. Freight Technologies cautions that the foregoing list of factors is not exclusive. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by such forward-looking statements. Freight Technologies and Fr8App caution readers not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Freight Technologies and Fr8App do not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in their expectations or any change in events, conditions or circumstances on which any such statement is based.
Los Angeles, California