TORONTO, ON (May 24, 2024) - EQ Inc. (TSXV: EQ.V) (“EQ Works” or the “Company”), a leader in AI and data driven software and solutions, announced its financial results today for the first quarter ended March 31, 2024.

Interest in the EQ suite of products increased significantly during the first quarter of 2024. Revenue of $1.6 million was relatively in line with the previous year, however, pipeline activities and proposals, including a number of new opportunities for its proprietary SAAS product Clear Lake, increased by more than 50%. Gross margin increased over the same period a year ago as more strategic initiatives and higher margin campaigns were executed and the Company’s expense realignment process from 2023 also had a very positive impact resulting in a substantial improvement in the adjusted EBITDA. The Company’s plan for 2024 is to continue to focus on clients and solutions that utilize the full extent of its AI driven intelligence products and its proprietary data assets. These types of engagements are more strategic, generate more value for its clients and provide a much stronger recurring financial model.

The gross margin for the quarter of 41% was an improvement over the same period a year ago, and the adjusted EBITDA loss of $0.6 million was a 40% improvement over the same period a year ago. In addition, with the deployment of EQ’s new suite of data products its pipeline has improved significantly and second quarter revenues are already on pace to surpass those of the previous year. The Company is excited and confident about the remainder of 2024.

“Profitability and growth continue to be our focus for 2024,” said Geoffrey Rotstein, President and CEO of EQ Works. “Our work last year to streamline costs and focus the team on enhancing our proprietary data and AI solutions is paying off. Client interest and demand for our solutions are gaining traction, and we expect to see the results of our hard work and investments continue to materialize in 2024. Data and AI are essential components for growth across all industries, and we have positioned ourselves extremely well to take advantage of these opportunities. Our AI and data solutions have been built with a customer first approach to ensure they drive solutions that deliver real business value.”

Subsequent to the quarter end the Company granted 20,000 stock options to employees of the Company. These stock options are exercisable at CDN $1.10 per stock option and will expire on May 24, 2029. These stock options vest over a period of thirty-six months following the grant date and are governed by the terms and conditions of the Company's stock options plan. Following this grant of stock options, the Company has a total of 1,838,500 stock options outstanding representing approximately 2.6% of the outstanding common shares of the Company.

Non-IFRS Financial Measures

EQ Works measures the success of the Company’s strategies and performance based on Adjusted EBITDA, which is outlined and reconciled with net loss in the section entitled “Reconciliation of net loss for the period to Adjusted EBITDA” in the MD&A. The Company defines Adjusted EBITDA as net loss from operations before: (a) depreciation of property and equipment and amortization of intangible assets, (b) share-based payments, (c) finance income and costs, net, and (d) restructuring costs. Management uses Adjusted EBITDA as a measure of the Company's operating performance because it provides information on the Company's ability to provide operating cash flows for working capital requirements, capital expenditures, and potential acquisitions. The Company also believes that analysts and investors use Adjusted EBITDA as a supplemental measure to evaluate the overall operating performance of companies in its industry.

The non-IFRS financial measure is used in addition to, and in conjunction with, results presented in the Company’s consolidated financial statements prepared in accordance with IFRS and should not be relied upon to the exclusion of IFRS financial measures. Management strongly encourages investors to review the Company's consolidated financial statements in their entirety and to not rely on any single financial measure. Because non-IFRS financial measures are not standardized, it may not be possible to compare these financial measures with other companies non-IFRS financial measures having the same or similar names. In addition, the Company expects to continue to incur expenses similar to the non-IFRS adjustments described above, and exclusion of these items from the Company's non-IFRS measures should not be construed as an inference that these costs are unusual, infrequent, or non-recurring.

The table below reconciles net loss from operations and Adjusted EBITDA for the periods presented:

About EQ Works

EQ Works (www.eqworks.com) enables businesses to understand, predict, and influence customer behaviour. Using unique data sets, advanced analytics, machine learning and artificial intelligence, EQ Works creates actionable intelligence for businesses to attract, retain, and grow the customers that matter most. The Company’s proprietary SaaS platform mines insights from movement and geospatial data, enabling businesses to close the loop between digital and real-world consumer actions.

Neither the TSX-V nor its Regulation Services Provider (as that term is defined in policies of the TSX-V) accepts responsibility for the adequacy or accuracy of this release.

Forward-Looking Statements

Certain statements contained in this press release constitute “forward-looking statements”. All statements other than statements of historical fact contained in this press release, including, without limitation, those regarding the Company’s future financial position and results of operations, strategy, plans, objectives, goals and targets, and any statements preceded by, followed by or that include the words “believe”, “expect”, “aim”, “intend”, “plan”, “continue”, “will”, “may”, “would”, “anticipate”, “estimate”, “forecast”, “predict”, “project”, “seek”, “should” or similar expressions, or the negative thereof, are forward-looking statements. These statements are not historical facts but instead represent only the Company’s expectations, estimates, and projections regarding future events. These statements are not guarantees of future performance and involve assumptions, risks, and uncertainties that are difficult to predict. Therefore, actual results may differ materially from what is expressed, implied, or forecasted in such forward-looking statements. Additional factors that could cause actual results, performance, or achievements to differ materially include, but are not limited to, the risk factors discussed in the Company’s MD&A for the three months ended March 31, 2024. Management provides forward-looking statements because it believes they provide useful information to investors when considering their investment objectives but cautions investors not to place undue reliance on forward-looking information. Consequently, all of the forward-looking statements made in this press release are qualified by these cautionary statements and any other cautionary statements or factors contained herein, and there can be no assurance that the actual results or developments will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Company. These forward-looking statements are made as of the date of this press release, and the Company assumes no obligation to update or revise them to reflect subsequent information, events, or circumstances or otherwise, except as required by law.

EQ Inc. • Peter Kanniah, Chief Financial Officer • press@eqworks.com