MIAMI - ShiftPixy, Inc. (NASDAQ:PIXY), a staffing enterprise focused on the gig economy, has announced the acquisition of TurboScale, an AI technology company specializing in scalable GPU cloud infrastructure. The $150 million deal, split evenly between stock and debt, aims to enhance ShiftPixy's platform with advanced AI capabilities.
TurboScale's technology provides GPU-accelerated infrastructure that simplifies the deployment and scaling of AI models for businesses. This acquisition is expected to bolster ShiftPixy's staffing efficiency and labor forecasting by integrating TurboScale's AI solutions.
Scott Absher, CEO of ShiftPixy, expressed enthusiasm about the acquisition, stating that TurboScale's AI infrastructure will amplify the company's capabilities and open new possibilities for clients. Chandler Song, CEO of TurboScale, echoed this sentiment, highlighting the synergy between AI and human intelligence in accelerating workforce productivity.
ShiftPixy plans to introduce new AI-powered features, such as real-time predictive analytics and machine learning-driven automation, to improve workforce management. The company anticipates that the integration of TurboScale's scalable solutions will enable businesses to fully leverage AI while maintaining cost efficiency. New AI-driven tools are expected to be rolled out by early 2025.
The partnership underscores ShiftPixy's commitment to innovation and its position at the forefront of workforce automation technology. By providing more intelligent and agile staffing solutions, the company aims to meet the evolving needs of its clients.
This acquisition is based on a press release statement and includes forward-looking statements that involve risks and uncertainties. ShiftPixy has advised that future results could differ materially from those expressed in these statements due to various factors, including changes in the law and the general economic climate.
In other recent news, ShiftPixy, a Miami-based employment agency, is grappling with potential delisting from Nasdaq due to non-compliance with the minimum publicly held shares requirement. The company is also facing delisting due to a market value shortfall. ShiftPixy has been given the opportunity to present its case at a Nasdaq Hearings Panel.
ShiftPixy's stockholders have approved proposals to amend the company's warrant agreement and increase its authorized shares. The company also declared a reverse stock split aimed at consolidating the company's shares. The CEO, Scott Absher, has been granted a conditional option to acquire over 5 million shares of Preferred Class A Stock, contingent upon the reverse stock split.
The company announced a securities offering facilitated by A.G.P./Alliance Global Partners (NYSE:GLP), which could potentially raise about $2.5 million. The offering includes over 2.4 million common shares and series A and B warrants. These are recent developments that investors should be aware of.
InvestingPro Insights
While ShiftPixy's acquisition of TurboScale marks a significant strategic move, recent financial data from InvestingPro paints a challenging picture for the company. ShiftPixy's market capitalization stands at a modest $2.75 million, reflecting investor caution. The company's revenue for the last twelve months as of Q3 2024 was $15.02 million, with a concerning revenue decline of 27.85% over the same period.
InvestingPro Tips highlight some critical issues facing ShiftPixy. The company is "quickly burning through cash" and "short-term obligations exceed liquid assets," which could potentially impact its ability to fully leverage the TurboScale acquisition. Additionally, ShiftPixy "suffers from weak gross profit margins," with the latest data showing a gross profit margin of just 3.88%.
These financial challenges are reflected in the stock's performance. InvestingPro data shows that ShiftPixy's stock has "taken a big hit over the last week," with a one-week price total return of -46.08%. The longer-term picture is equally concerning, with a one-year price total return of -97.06%.
Despite these headwinds, the TurboScale acquisition could potentially address some of ShiftPixy's operational inefficiencies. The integration of AI capabilities might help improve the company's gross profit margins and overall operational performance in the long run.
Investors considering ShiftPixy should note that InvestingPro lists 18 additional tips for this stock, offering a more comprehensive analysis of the company's financial health and market position. These insights could prove valuable in assessing the potential impact of the TurboScale acquisition on ShiftPixy's future prospects.
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