Quarterly report pursuant to Section 13 or 15(d)

Discontinued Operations

v3.23.1
Discontinued Operations
 3 Months Ended
Mar. 31, 2023
Discontinued Operations and Disposal Groups [Abstract]  
Discontinued Operations Discontinued Operations
On March 14, 2023, the Company completed the Business Combination which divested its Enterprise Apps Business and certain related assets and liabilities through a spin-off of CXApp Holding Corp., a Delaware corporation ("Legacy CXApp") to Inpixon’s shareholders of record as of March 6, 2023 (the “Record Date”) on a pro rata basis. This Enterprise Apps Spin-off was considered a strategic shift that has a major impact on the Company, and therefore, the results of operations are recorded as a component of "Earnings (loss) from discontinued operations, net of income taxes" in the Condensed Consolidated Statements of Operations for all periods presented. The Company noted that Legacy CXApp was part of the Company’s Indoor Intelligence segment. The net assets distributed as a result of the Enterprise Apps Spin-off was $24.2 million. Included within the $24.2 million dividend recorded to Additional Paid in Capital as a result of the deconsolidation of CXApp through distribution to shareholders recorded during the three months ended March 31, 2023, is approximately, $1.2 million in accumulated other comprehensive income that was recognized as a result of those distributed assets and liabilities included in the foreign operations of CXApp.

The following table summarizes certain selected components of discontinued operations for the spun-off entity:

Three Months Ended March 31, 2023 Three Months Ended March 31, 2022
Revenues $ 1,620  $ 2,582 
Cost of Revenues 483  589
Gross Profit 1,137  1,993 
Operating Expenses
Research and development 1,514  1,961 
Sales and marketing 988  1,107 
General and administrative 1,644  1,446 
Earnout compensation benefit —  (2,827)
Acquisition related costs —  6
Transaction costs 1,043  — 
Amortization of intangibles 805  975 
Total Operating Expenses 5,994  2,668 
Loss from Operations (4,857) (675)
Other Income (Expense)
Interest (expense)/income, net 1  1
Total Other Income (Expense) 1  1
Loss from discontinued operations, before tax (4,856) (674)
Income tax provision $ —  (100)
Loss from discontinued operations, net of tax (4,856) (774)

Cash used in operating activities by the Enterprise Apps Business totaled approximately $0.8 million and $3.0 million for the three months ended March 31, 2023 and 2022, respectively. Cash provided by investing activities from the Enterprise Apps Business totaled approximately $0.1 million for the three months ended March 31, 2023 and cash used in investing activities by the Enterprise Apps Business totaled approximately $0.04 million for the three months ended March 31, 2022.
Note 24 - Discontinued Operations (continued)

The following table summarizes certain assets and liabilities of discontinued operations:

As of December 31, 2022
Current Assets of Discontinued Operations
Cash and cash equivalents $ 10,000 
Accounts receivable 1,338 
Prepaid expenses and other current assets 923 
Current Assets of Discontinued Operations $ 12,261 
Long Term Assets of Discontinued Operations
Property and equipment, net $ 202 
Operating Lease Right-of-Use Asset, net 681 
Software development costs, net 487 
Intangible assets, net 19,289 
Other Assets 52 
Long Term Assets of Discontinued Operations $ 20,711 
Current Liabilities of Discontinued Operations
Accounts payable $ 1,054 
Accrued liabilities 1,736 
Operating lease obligation, current 266 
Deferred revenue 2,162 
Current Liabilities of Discontinued Operations $ 5,218 
Long Term Liabilities of Discontinued Operations
Operating lease obligation, noncurrent $ 444 
Other Liabilities, noncurrent 28 
Long Term Liabilities of Discontinued Operations $ 472