Overview of CXApp’s Business

Executive Overview At CXApp, we are redefining the modern workplace through AI-powered solutions that enhance employee experience, operational efficiency, and workplace intelligence. As a leader in this rapidly evolving market, our strategic vision is to drive innovation, scale our enterprise customer base, and achieve long-term financial sustainability through disciplined execution.

In fiscal year 2024, we focused on three key priorities:

1. Expanding AI-Driven Capabilities – Creating a Generative AI based analytics platform designed to revolutionize the workplace environment, allowing organizations to analyze large datasets, generate actionable insights and make real-time decisions.
2. Strengthening Market Position “Land and Expand” – Growing our footprint in the Fortune 1000 and expanding offerings to existing clients.
3. Enhancing Financial Discipline – Driving cost efficiency while investing in strategic growth initiatives.

As we look ahead, our leadership team remains committed to balancing innovation with financial discipline, ensuring CXApp is positioned for sustainable, profitable growth in the years to come.

Financial Performance Summary Revenue Growth and Customer Expansion

• Fiscal year 2024 recurring revenue increased to 87% from 78%.
• Our customer base continues to expand across key industries, including financial services, healthcare, and technology.
• The transition to a recurring revenue model has strengthened revenue predictability and long-term growth prospects.

Operational Efficiencies and Cost Management

• Total operating expenses decreased to $19,598 thousand compared to $58,204 during the year ended December 31, 2023, reflecting cost optimization initiatives that have improved margins.
• Strategic workforce realignments have ensured resources are allocated to high-impact growth areas.

Cash Flow and Liquidity Position

• As of year-end, cash and cash equivalents was $4,880 thousand with access to an additional $3,500 thousand from a Securities Purchase Agreement the Company entered into on May 22, 2024, later bolstered by an additional $20,000 thousand secured on March 25, 2025, ensuring flexibility to support future growth.
• Ongoing investments in AI innovation and product enhancements are aligned with our long-term financial strategy.

Strategic Growth Initiatives

1. Product Innovation: Expanding our AI-native capabilities, enhancing analytics, and integrating with key enterprise platforms.
2. Market Expansion: Targeting new verticals, strengthening partnerships with cloud providers, and scaling international operations.
3. Operational Excellence: Optimizing cost structures, improving customer retention, and driving sales efficiency.

Competitive Positioning and Market Outlook

• The global employee experience market is projected to grow at 20% CAGR, presenting strong tailwinds for CXApp’s expansion.
• Our AI-driven platform differentiates us from traditional workplace management solutions, enabling scalable, data-driven decision-making.
• Despite macroeconomic uncertainties, enterprise demand for hybrid workplace solutions remains strong, positioning CXApp for continued momentum.

Conclusion As we move forward, our leadership team remains committed to executing on our strategic vision, leveraging AI to redefine employee experiences, and delivering long-term value for our stakeholders. We believe CXApp’s AI-first approach, financial discipline, and customer-centric strategy position us well for sustained growth.

Business Description

Company Overview CXApp Inc. (“CXAI”) is an AI-first employee experience platform that is redefining the employee experience market. Our mission is to put the employee first by delivering an intuitive and intelligent solution that seamlessly integrates the physical and digital workplace. With headquarters in the San Francisco Bay Area and satellite hubs in Toronto and Manila, we operate globally across more than 50 countries, serving Fortune 1000 companies in highly regulated industries such as financial services, healthcare, and technology.

Prior to the closing of the Business Combination on March 14, 2023, CXApp and subsidiaries were wholly owned subsidiary of Inpixon (“Inpixon”) and the Company’s financial statements consist of Design Reactor, Inpixon Canada, Inpixon Philippines and select assets, liabilities, revenues and expenses of Inpixon and Inpixon India (collectively the “Company,” “we,” “us” or “our”), show the historical combined carve-out financial position, results of operations, changes in net investment and cash flows of the Company and should be read in conjunction with the accompanying notes thereto. The Company’s combined carve-out financial statements do not necessarily reflect what the results of operations, financial position, or cash flows would have been had the Company been a separate entity nor are they indicative of future results of the Company.

Market Opportunity The employee experience market is experiencing rapid transformation driven by the shift to hybrid work environments and the demand for AI-driven solutions that optimize employee engagement and operational efficiency. According to industry research from Gartner and Forrester, the global market for employee experience software is projected to grow significantly as organizations seek solutions that enhance employee productivity and satisfaction. We believe CXAI is uniquely positioned to capitalize on this trend by providing an AI-native platform designed to address the evolving needs of the modern workplace.

Products and Services Our flagship product, the CXAI Platform (pronounced “Sky”), provides a comprehensive suite of tools designed to empower employees and enable organizations to create smarter workplaces. Key components of the platform include:

• CXAI Apps: A multi-platform suite of applications (iOS, Android, and web) offering AI-driven, personalized workflows for employees, enhancing productivity and engagement.
• CXAI BTS (Behind the Scenes): The core AI engine that powers automation, content management, and security compliance for enterprise-wide deployments.
• CXAI-VU: A generative AI analytics platform that provides actionable insights into workplace utilization, employee engagement, and productivity, allowing real-time decision-making.

CXAI’s solutions are available through leading cloud marketplaces, including AWS, Google Cloud, and Microsoft Azure, offering seamless procurement and deployment options for enterprise customers.

Revenue Model CXAI generates revenue through a mix of:

• SaaS Subscriptions: Recurring revenue streams from our cloud-based application offerings.
• Professional Services: Implementation, customization, and support services tailored to client needs for deployment of the application.
• Hardware: Pass through beacons delivered to the customers.

Revenue Breakdown by Product Category

,,Successor,,,,,,,,Predecessor,,, ,,Year ended

     December 31  

2024,,,,Period from
March 15
2023 to
December 31
2023,,,,Period from
January 1
2023 to
March 14
2023,,, Software,,$,6 202,,,$,4 560,,,$,1 204,, Professional services,,,798,,,,1 186,,,,416,, Hardware,,,142,,,,-,,,,-,, Total revenue,,$,7 142,,,$,5 746,,,$,1 620,,

With 87% of our revenue derived from recurring subscriptions, CXAI enjoys stable and predictable cash flow, further supported by strong net retention rates and customer upsell opportunities.

Strategic Partnerships We have established strategic relationships with leading cloud providers, including Google Cloud, Microsoft Azure, and Amazon Web Services. These partnerships allow us to scale our solutions rapidly, access new markets, and leverage cutting-edge cloud technologies to enhance our offerings.

Technology and Innovation CXAI differentiates itself through proprietary AI technology and a commitment to innovation. Our intellectual property portfolio includes 37 filed patents, with 17 already issued, positioning us as a leader in employee experience software. Our platform leverages generative AI and autonomous agents to automate workflows, drive employee engagement, and optimize resource utilization.

Competition, Strengths, and Differentiation For our employee experience app products, we compete with companies such as Petur, Modo Labs, HqO, Robin Powered, and Comfy. For our mapping product, our competitors include MappedIn, Mapwize, and Esri.

We differentiate ourselves by offering a comprehensive and unified employee experience platform that addresses the evolving needs of modern enterprises:

• One App, Comprehensive Experience
• Seamless Employee Experience
• Versatile and Scalable Functionality
• Expansive Ecosystem and Integrations
• Enterprise-Grade Scalability
• Technology-Agnostic & Open Architecture

Competitive Positioning CXAI stands out in the competitive landscape through its deep AI integration, employee-first approach, and enterprise-grade security and compliance. Unlike traditional workplace management solutions, our platform offers:

• AI-driven automation to streamline workflows and reduce manual processes.
• Advanced analytics for actionable insights into workplace utilization and engagement.
• Seamless integration with enterprise systems and cloud environments, ensuring efficiency and scalability.

By combining AI-powered intelligence, user-centric design, and enterprise-ready capabilities, CXApp delivers a truly next-generation employee experience platform that sets us apart from the competition.

Corporate Strategy The modern office is no longer confined to a single location. We believe that empowering employees and teams to manage diverse workplace scenarios from their personal devices is the future of work. Enterprise organizations are increasingly recognizing the pivotal role of AI-driven mobile applications in managing distributed workforces and optimizing office environments.

Over the next five years, we anticipate that artificial intelligence (AI) will become a cornerstone of employee experience initiatives. CXApp is uniquely positioned as the central intelligence layer for hybrid workplace models. Our AI-powered employee experience platform integrates advanced analytics, automation, and machine learning to enhance employee engagement, streamline operations, and optimize resource utilization.

Our strategic approach focuses on transforming workplace efficiency through:

• Smart Workplace Automation: AI-driven management of desk and meeting room bookings, space allocation, and resource management.
• Predictive Analytics: Real-time data analysis to drive informed decision-making regarding space utilization and employee engagement.
• Contextual Employee Experiences: AI-powered personalization delivering tailored notifications, workspace suggestions, and relevant content.
• Proactive Facility Management: Intelligent mapping and occupancy tracking to prevent operational bottlenecks.

Through an AI-first strategic model, CXApp aims to provide a seamless, intelligent employee experience that adapts to evolving work styles. Our commitment to innovation and enterprise-grade AI solutions ensures that organizations can thrive in an increasingly digital and dynamic work environment.

Growth Strategy Since the launch of our core workplace product in 2017, CXApp has followed a direct-to-customer go-to-market strategy, targeting Fortune 1000 enterprises. This approach has allowed us to establish strong relationships with Fortune 500 companies in the financial services, media, and software industries, solidifying our leadership in enterprise workplace technology.

In addition, our technology partner program has played a crucial role in our expansion. With over 90 partnerships, including integrations with digital lockers, sensors, and single sign-on (SSO) platforms, we offer seamless workflows that enhance the employee experience.

Our future growth strategy focuses on the following key initiatives:

• Advancing AI-Driven Product Development: Expanding our platform with AI-powered automation, predictive analytics, and intelligent workplace recommendations to support digital transformation and hybrid workforce evolution.
• Expanding into New Vertical Markets: Scaling into industries such as corporate real estate, healthcare, financial services, and technology enterprises to capitalize on growing demand for AI-driven workplace solutions.
• Strengthening Our Channel Partner Ecosystem: Enhancing partnerships with Google Cloud and Amazon, while fostering relationships with workplace technology providers, resellers, and enterprise IT integrators.
• Building AI-Enabled Sales and Marketing Strategies: Leveraging AI-driven insights to increase brand awareness, expand industry collaborations, and drive thought leadership in workplace technology.

By combining innovation, strategic partnerships, and customer-centric solutions, we are committed to achieving sustainable growth and reinforcing our position as a market leader in employee experience technology.

Risk Management and Compliance We take a proactive approach to risk management by monitoring regulatory changes and implementing robust internal controls. Our compliance programs include adherence to global data privacy standards and security frameworks such as GDPR and SOC 2. By integrating these elements into our business strategy, CXAI is well-positioned to continue driving innovation and delivering value to stakeholders.

Recent Events

December 2023 Note Exchanges During the period from July 15, 2024, to December 26, 2024, the Company exchanged $3,428 thousands of the outstanding balance of the Note for approximately 2,012,107 shares of the Company’s Class A Common Stock at exchange prices between $1.47 and $2.23 per share.

Pursuant to the Exchange Agreements, the Lender will surrender the Partitioned Note in exchange for the Exchange Shares, which will be issued free of any restrictive securities legend. Other than the surrender of the Partitioned Note, no consideration of any kind shall be given by Lender to the Company in connection with this Agreement. Upon surrendering, the Partitioned Notes shall be cancelled, and all obligations of Borrower under the Partitioned Notes shall be deemed fulfilled.

The Company analyzed the exchange of principal under the note as an extinguishment and compared the net carrying value of the debt being extinguished to the reacquisition price (shares of common stock being issued) and recorded an approximately $1,052 thousand loss on the exchange of debt for equity as a separate item in the other income (expense) section of the consolidated statements of operations for the year ended December 31, 2024.

As of January 17, 2025, the Company paid down the entire December 2023 Note.

Interest expense for the December 2023 Note recognized on the consolidated statements of operations and comprehensive loss were approximately $1,204 thousand and $53 thousand for the year ended December 31, 2024, and for period from March 15, 2023, to December 31, 2023, respectively.

Convertible Debt Conversion On May 22, 2024, the Company entered into a Securities Purchase Agreement (the “SPA”), pursuant to which Streeterville Capital, LLC wants to purchase up to $10,000 thousand shares of the Company’s Common Stock and the Company issued an unsecured convertible Pre-Paid Purchase #1 to the Lender. The convertible Pre-Paid Purchase #1 has the original principal amount of $2,625 thousand and Lender gave consideration of $2,480 thousand, reflecting original issue discount of $125 thousand and Lender’s transaction cost of $20 thousand.

During the year ended December 31, 2024, the Company has issued 1,683,104 shares of the Company’s Class A Common Stock pursuant to multiple purchase notices for an exchange amount of $2,100 thousand.

Key Factors Affecting CXApp’s Results of Operations

Customer Base CXApp serves a diverse range of industries, providing intelligent employee experience solutions to enterprise customers across key sectors such as technology, financial services, consumer goods, healthcare, and media & entertainment. As of December 31, 2024, our customer base spans approximately across 51 countries, with the majority of our customers headquartered in the United States. Our customers include Fortune 1000 companies that rely on our AI-powered CXAI platform to enhance employee engagement, workplace productivity, and operational efficiency. Our strong security and compliance credentials make us a preferred choice for enterprises in highly regulated industries. We focus on delivering value to our customers through innovative solutions, ongoing product enhancements, and dedicated customer success initiatives.

We monitor key performance indicators such as revenue growth, customer expansion, recurring revenue rates, and customer retention to measure our market penetration and growth trajectory. In 2024, approximately 87% of our revenue was recurring, reflecting a significant increase from 78% in 2023.

CXApp’s ability to drive revenue growth depends on expanding relationships with existing customers and acquiring new customers by offering high-quality, scalable solutions that address the evolving needs of enterprises. Our direct sales efforts, strategic partnerships, and continuous innovation efforts play a crucial role in customer acquisition and retention. We maintain a diversified customer base, with our top three customers accounting for approximately 24% of our gross revenue in 2024, compared to 22% in 2023.

Acquisitions and Investments CXApp has not completed any mergers or acquisitions from March 14, 2023, to date; however, we continually evaluate strategic opportunities that align with our growth objectives and enhance our AI-driven employee experience platform. Our acquisition strategy focuses on expanding our product capabilities, entering new markets, acquiring top-tier talent, and achieving operational synergies.

We take a disciplined approach to potential acquisitions and investments, ensuring alignment with our strategic goals and financial performance. Opportunities may be pursued through cash, stock, or a combination of both, depending on market conditions and strategic fit.

While organic growth remains our priority, strategic acquisitions and partnerships are expected to play a key role in accelerating our expansion and strengthening our market position. There is no guarantee that we will pursue or complete any transactions, but we remain open to opportunities that we believe drive long-term value for our stakeholders.

Research and Development During the year, the Company added resources dedicated to developing the Artificial Intelligence (AI) based Augmented Reality (AR), AI based analytics and our CXAI Agentic AI offerings on the CXAI platform. Management believes that this investment in research and development will maintain a competitive position and create opportunities for the Company.

RESULTS OF OPERATIONS

Year Ended December 31, 2024, compared to the Year Ended December 31, 2023 For the purposes of the analysis of the results presented herein, the Company is presenting the combined results of operations for