NEW YORK - HeartCore Enterprises, Inc. (NASDAQ:HTCR), a Tokyo-based enterprise software and consulting services company, is currently facing delisting from the Nasdaq Capital Market due to non-compliance with the exchange's minimum bid price requirement. The company received notice on October 22, 2024, that its stock did not meet the $1.00 minimum bid price, and it has until today to appeal the decision before a Nasdaq Hearings Panel.
If HeartCore does not appeal or the appeal fails, trading of its common stock will be suspended on October 31, 2024, followed by the filing of a Form 25-NSE with the SEC, which will remove the company's securities from listing and registration on Nasdaq. HeartCore intends to request a hearing and present a strategic plan to regain compliance with Nasdaq's listing requirements.
Despite the compliance issue, HeartCore recently announced preliminary Q3 2024 results, anticipating revenues between $17 million and $19 million, which would mark a year-over-year increase of 263% to 305%. The company also expects net income for the same period to be between $9 million and $11 million. HeartCore remains confident in its operational execution and its ability to deliver shareholder value, calling this year projected to be the strongest in its history.
Previously, in October 2023, HeartCore was given 180 calendar days to regain compliance with the minimum bid price requirement. An additional grace period was granted in April 2024, extending the deadline to October 21, 2024. During these periods, there was no immediate impact on the company's listing or trading on the Nasdaq.
HeartCore offers a range of software as a service (SaaS) solutions and data analytics services. The company's customer experience management platform is designed to enhance customer experience and engagement. Additionally, HeartCore provides digital transformation services, including robotics process automation and consulting services for Japanese companies looking to go public in the U.S.
There is no assurance that HeartCore will regain compliance with the Minimum Bid Price Requirement, even though it may fulfill other listing standards. This news is based on a press release statement issued by HeartCore Enterprises, Inc.
In other recent news, HeartCore Enterprises is facing potential delisting from Nasdaq due to non-compliance with the minimum bid price requirement. The company has expressed its intention to appeal the decision, exploring possible actions to regain compliance. HeartCore also reported significant revenue of $17.9 million from SBC Medical Group Holdings Inc.'s initial public offering. This was due to initial fees and warrants valued at $17 million, including a $9 million sale of warrants to a Japanese financial institution.
HeartCore has also announced collaborations with Tosho Computer Systems Co., Ltd. and Fourmix Co., Ltd., aiming to boost sales of its investor relations support tool, irVision, and integrate its Content Management System platform into Fourmix's operations, respectively. At its annual virtual meeting of stockholders, all six nominees for the Board of Directors were elected to serve a one-year term, and the company received approval from its shareholders to implement a reverse stock split of its common stock.
For Q3 2024, HeartCore has projected revenues between $19 million and $23 million, with a net profit ranging from $4 million to $8 million. This is an increase compared to the first nine months of 2023, where the company expects to generate between $28.1 million to $32.1 million in revenue for the same period in 2024. These are some of the recent developments for HeartCore Enterprises.
InvestingPro Insights
Despite HeartCore Enterprises' (NASDAQ:HTCR) current delisting challenge, recent InvestingPro data reveals some intriguing aspects of the company's financial position. As of the last twelve months ending Q2 2024, HeartCore reported revenue of $17.13 million, which aligns with the preliminary Q3 2024 results mentioned in the article. This suggests that the company is maintaining its revenue levels despite the challenges it faces.
Interestingly, HeartCore's stock has shown remarkable resilience in the face of its listing woes. InvestingPro data indicates a strong return of 84.35% over the past year, with an impressive 52.42% gain in the last three months alone. This performance contradicts the narrative of a struggling company and may reflect investor optimism about HeartCore's future prospects.
An InvestingPro Tip notes that analysts anticipate sales growth in the current year, which could be a positive factor in the company's appeal to remain listed on Nasdaq. Additionally, HeartCore pays a significant dividend to shareholders, with a current dividend yield of 7.21% as of October 24, 2024. This generous dividend policy might be seen as a strategy to maintain investor interest during this critical period.
It's worth noting that HeartCore operates with a moderate level of debt, which could provide some financial flexibility as it navigates its current challenges. However, potential investors should be aware that the company is not profitable over the last twelve months, with an operating income margin of -41.69%.
For those interested in a deeper analysis, InvestingPro offers 15 additional tips for HeartCore Enterprises, providing a more comprehensive view of the company's financial health and market position.
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