We’ve got our heavy-lift drones. As mentioned, we’ve launched the Commander 3XL. We have precision delivery systems. We have quick-release delivery boxes. We do have many payloads that are integrated with dozens of different sensors from other manufacturers, whether those are cameras, whether they’re ordinance, whether they’re surveillance. Whatever the case may be, we’ve really, again, designed this system so that all of those payloads can fit on this and then we are approaching the market as partners. The majority of our pipeline work now, really, is coming in from payload partners. So these payload partners work with a customer, whether it’s commercial or primarily military right now, where they’ve got a specific capability on their sensor.
And then that sensor is in demand. And then what we’ve done is integrated with that sensor to be the best-of-breed for that sensor to be able to work. And a big part of that is the amount of battery life that we can deliver and the amount of range that we can deliver with our particular platforms. It should be noted that we will – unexpectedly, we will be having a number of products come out through the rest of the year. These are purpose-driven products. These are products that have been specifically requested for us to build by customers at scale. And so this has been the real kind of eye-opening and pleasurable surprise that we’ve had this year, where we’ve standardized on our Commander 3XL and our heavy-lift drone as a platform, we will be having some new products come out this year that we will put into production lines by Q1 of next year, which is a lot quicker than we thought, but it’s just based on the specifications and the types of customers that are ordering and giving us demand signals at size.
So on this note, I’m going to turn it over to Paul to run through our financials, and then I’ll come back and go through some Q&A. Paul?
Paul Sun: Thanks, Cam, and thanks, everybody, for joining, as usual. At the beginning of the presentation, Cam went through the revenue for the year. Just to reiterate, $6.6 million versus $7.6 million year-over-year, so down about 15%. And I think Cam explained the reason why that happened. Again, the split on revenue, $5.3 million from product sales, $1.3 million coming from drone services. On the gross profit side, $2.1 million for the year compared to $791,000 from last year. This year’s gross profit included a onetime non-cash write-down of inventory of about $331,000, while last year’s included a non-cash adjustment of $1.9 million. So to do an apples-to-apples, if we ex out these adjustments, gross profit decreased by about $370,000 year-over-year.
And, as a percentage of sales, adjusted margin increased from 36.4% last year to 36.5%. So pretty much the same year-over-year on a gross margin perspective. Total comprehensive loss for the year, including all non-cash items, was $23.7 million compared to a loss of $27.3 million last year. Again, there was – the non-cash changes comprised of a gain in fair value of derivative liability of $211,000, an expense impairment on some notes receivable of $101,000, a write-down of inventory of $331,000 and expense of goodwill and intangible impairment of about $87,000, so otherwise, comprehensive loss. Netting all that out, actually wouldn’t have changed too much, $23.4 million versus last year’s $24 million, again, on an apples-to-apples adjusted basis.
So slightly better year-over-year. And then following that, the adjusted loss per share this year would still pretty much be the same at $0.56 compared to the adjusted loss from last year of about $0.71 versus the $0.81 shown here. On the next slide, please. Yes, just kind of looked at the quarters now, so we just went year-over-year. So we’ll now look at Q4, doing a year-over-year comparison. Revenue for the fourth quarter was down about 30% to $916,000 from $1.3 million in the fourth quarter of 2022. Fourth quarter revenue comprised of about $671,000 from product sales with the balance of $244,000 coming from drone services. The gross profit was $258,000, compared to negative $1.6 million in Q4 of last year due to onetime non-cash write-down of inventory and otherwise would have been $310,000 for the same quarter last year.
So gross profit for Q4 of this year would have been $382,000, if we took away the onetime inventory write-down of $123,000; while Q4 last year would have been $310,000 due to the onetime write-down that I mentioned earlier. Hence, gross profit for the quarter was up 23.1% year-over-year, while an adjusted margin, as a percentage of revenue was 41.7% versus last year’s 23.6%. So big jump on the quarters on a gross margin basis, and that’s as a result of more sales coming from higher margin products in this quarter versus same quarter last year. On the comprehensive loss for the quarter, $4.2 million compared to a loss of $16.7 million in the same quarter last year. As mentioned, the quarter included non-change and comprised of a fair value of derivative liability of $154,000 and $123,000 inventory write-down and would otherwise be a comprehensive loss of $4.2 million; comparing that to an adjusted loss of $7.5 million, ex-ing out that quarter’s onetime items.
So again, loss, quarter for the year, for Q4, quite a bit better. Decrease is primarily due to lower professional fees, wage costs, and share-based compensation. We just went through the year-over-year outlook for the quarter. I’ll now look at the quarter-over-quarter changes, meaning Q4 to Q3. So basically – sorry, Cam, just the previous – still the same slide there. Yes. Yes, that’s right. Yes. So basically, revenue for Q4 was down 57% compared to Q3, just mainly due to some lower product sales. Gross margin as a percentage for Q4 was 28.3% compared to 41% in the previous quarter. However, if we back up the onetime inventory write-down, gross margin for Q4, as mentioned, was effectively 41.7%, so pretty much in line with the previous quarter.
