Overview

Aeluma is a company that develops novel optoelectronic devices for sensing and communications applications. The company has pioneered a technique to manufacture devices using high-performance compound semiconductor materials on large-diameter substrates commonly used in mass-market microelectronics. This enables cost-effective manufacturing of high-performance photodetectors and photodetector array circuits for applications such as mobile device camera image sensors, LiDAR, AR/VR, and facial recognition.

Private Placements

Between December 2022 and May 2023, Aeluma entered into subscription agreements with accredited investors, issuing 2,017,498 shares of common stock at $3.00 per share for gross proceeds of $6,052,500. The company paid a cash placement agent fee of $411,015 and issued placement agent warrants to purchase up to 85,653 shares of common stock at $3.00 per share.

Additionally, between August 2024 and August 2027, Aeluma issued convertible promissory notes in the aggregate principal amount of $3,145,000 to 10 accredited investors. The notes mature in June 2026 and are convertible into shares of the company’s common stock upon certain events, such as a qualified financing or uplisting to a national securities exchange.

Departure and Appointment of Directors and Officers

In 2023, Mrs. Mehta decided not to run for re-election to the board of directors, and the board nominated Mr. Craig Ensley to fill the vacancy.

Plan of Operations

Aeluma has been developing its materials and characterization capabilities at its headquarters in Goleta, California, installing key manufacturing equipment and developing relationships with manufacturing partners. The company has gained access to a rapid prototyping facility and is leveraging this to fabricate early-stage prototypes. Aeluma intends to implement appropriate quality and manufacturing controls in the future.

The primary sources of funding for equipment procurement and installation have been the seed funding raised prior to becoming a public company and the financing rounds. Aeluma has also leveraged funds to continue strengthening its intellectual property, including patent applications, trademarks, and development of trade secrets and manufacturing process recipes.

Limited Operating History

Aeluma cannot guarantee that the proceeds from the recent financing will be sufficient to carry out all of its business plans. The company’s business is subject to risks inherent in growing an enterprise, including limited capital resources, risks in the research and development process, and possible rejection of its products in development.

Components of Results of Operations

Aeluma’s revenue currently consists of commercial product sales and government contracts. Operating expenses include cost of revenue, research and development expenses, and general and administrative expenses. Other income includes interest income and sublease income, which ended in March 2023.

Results of Operations

Aeluma’s revenue increased by 375.1% to $918,554 in the year ended June 30, 2024, compared to $193,339 in the prior year. This was driven by growth in both commercial product and service contracts and government contracts. Operating expenses decreased by 3.9% to $5,481,862, primarily due to a reduction in consulting expenses, offset by increased salaries and stock-based compensation. Other income decreased by 99.2% to $1,013, mainly due to the end of the sublease.

Capital Resources and Liquidity

Aeluma has been funding its operations through the sale of common stock in private placement transactions. As of June 30, 2024, the company had $1,291,072 in cash and cash equivalents, which management believes is insufficient to complete its business plan. Aeluma will need to seek additional financing, either through debt or equity, to continue operations. There is no assurance that such financing will be available or on terms satisfactory to the company.

Aeluma had working capital of $766,160 at June 30, 2024, down from $4,576,807 at the prior year-end, primarily due to a decrease in cash. Net cash used in operating activities was $3,454,779 and $3,637,972 for the years ended June 30, 2024 and 2023, respectively, due to net losses.

Recent Accounting Pronouncements

Aeluma has evaluated all issued but not yet effective accounting pronouncements and determined that they are either immaterial or not relevant to the company.