BEIJING, May 26, 2022
/PRNewswire/ -- Luokung Technology Corp. (NASDAQ: LKCO)
("Luokung," "we," "our" or "us"), a leading spatial-temporal
intelligent big data services company and provider of interactive
location-based services ("LBS") and high-definition maps ("HD
Maps") in China, today made
available the following open letter to shareholders from Mr.
Xuesong Song, our Chairman and CEO,
regarding Luokung's business strategy and outlook for 2022 and
beyond:
To all of Luokung's shareholders,
We are incredibly proud of our progress in 2021, which was
highlighted by record revenue of over $145
million, more than seven times that in 2020. This was a
milestone year for Luokung, and this is only the beginning of our
plans in the years to come.
Over the past few years, Luokung has been dedicated to our
R&D efforts, strengthening our technologies and portfolio of
offerings while overcoming various challenges as a micro-cap,
China-based company listed in
the United States. In 2021, we
made several strategic decisions to create a solid foundation upon
which Luokung's current and future growth are based. We anticipate
continuing to build upon this positive momentum to accelerate our
expansion in the future.
We believe that Luokung's three core business pillars: smart
transportation and autonomous driving, carbon-neutral natural
resource asset data services, and LBS smart industry services, are
markets with significant untapped potential for rapid growth.
Luokung wishes to be a leader in building an intelligent
spatial-temporal big data Internet of Things ("IoT") world in these
markets.
Over the past three years, we have focused on leveraging
Luokung's leading technological capabilities to create new products
and services that are assembled in a standardized and modularized
way to improve service efficiencies and increase marginal benefits.
We took on several customized projects to achieve productization
while gathering industry insights to realize this goal.
Financially, these projects have resulted in low technical service
revenues and negative profit margins. However, we believe this was
a critical and necessary stage of strategic investment and
development of our value proposition.
In the first letter to shareholders that I shared in
September 2021, we revealed our
three-pillar business strategy for the first time. In these three
fields, Luokung has commercialized some products using its
technological competitive advantages and has begun providing these
services for specific needs. The launch of platform-based,
systematic, and modular AI data application products and services
marks the return of our continuous investments and the emergence of
the intrinsic value of these investments. We believe that upgrading
from single-point customized services to centralized, streamlined
and standardized services will enable us to lay a solid foundation
for an accelerating growth trajectory.
Luokung considers 2021 as a milestone for our revenue ramp.
While we saw significant revenue growth in 2021, Luokung did incur
losses for the year due to the investments in R&D and a strong
business foundation.
In 2022, we intend to continue to enhance our core capabilities
through research and development, keeping with our commitment to
ongoing innovation and constant improvement. We also expect to
continue improving our product lines for all three business pillars
to address various unfulfilled needs of our customers.
We anticipate our LBS business will continue to grow as the
largest revenue contributor, supported by growing revenues from our
smart transportation and carbon-neutral natural resource asset data
services offerings. As market demand continues to increase, we are
optimistic about the significant market opportunity presented by
the smart transportation and natural resource asset management
businesses. We expect revenues from these two lines of business
will begin to grow as a percentage of total revenues in 2022 and
beyond. Supported by business expansion and subsequent margin
expansion from the smart transportation and natural resource asset
management businesses, Luokung anticipates that operating cash flow
will improve for the next few years.
In the first quarter of 2022, we announced the acquisition of
Hongda Jiutong, a big data service company for the Internet of
Vehicles, bringing in-depth expertise to our vehicle-road
collaboration ("V2X") business. We anticipate that after we finish
the integration of Hongda Jiutong's V2X insights into our current
autonomous driving and smart expressway business, the launch of new
products will generate notable service revenues starting this year.
In 2022, Luokung has also increased investment in product R&D
based on blockchain technologies to add value to our offerings in
all three business sectors. BotAoit, an affiliate of Luokung, has
recently signed a service contract to provide electronic blockchain
data and certificate storage platform services. We expect to cover
more than six million commercial vehicles and over 100,000 units of
road-end metering and calibration-testing equipment annually. This
contract is expected to bring significant contributions
financially, and synergistic benefits to Luokung's smart expressway
V2X-related products.
As a public company, Luokung is committed to communicating with
our shareholders and the greater investment community to allow them
to have a clearer understanding of our business and vision. To that
end, we plan to publish our strategic business plan soon. The plan
will explain how Luokung's spatial-temporal digital base, driven by
our core technologies, empowers the application and interaction of
our three business pillars, and their respective product-service
composition and market objectives.
On behalf of our board of directors and management team, I would
like to once again thank you for your continued trust in and
support of Luokung, which has empowered us to expand our business.
We are excited about our journey ahead and are focused on
delivering on our growth initiatives.
Thank you.
Mr. Xuesong Song,
Chairman and CEO
For a current review of Luokung and a copy of this letter,
management invites you to visit our website: www.luokung.com.
About Luokung Technology Corp.
Luokung Technology Corp. is a leading spatial-temporal
intelligent big data services company, as well as a leading
provider of LBS and HD Maps for various industries in China. Backed by its proprietary technologies
and expertise in HD Maps and multi-sourced intelligent
spatial-temporal big data, Luokung established city-level and
industry-level holographic spatial-temporal digital twin systems
and actively serves industries including smart transportation
(autonomous driving, smart highway and vehicle-road collaboration),
natural resource asset management (carbon neutral and environmental
protection remote sensing data service), and LBS smart industry
applications (mobile Internet LBS, smart travel, smart logistics,
new infrastructure, smart cities, emergency rescue, among others).
The Company routinely provides important updates on its website:
https://www.luokung.com.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS
This press release contains certain forward-looking statements.
Forward-looking statements include, but are not limited to,
statements regarding our or our management's expectations, hopes,
beliefs, intentions or strategies regarding the future and other
statements that are other than statements of historical fact. In
addition, any statements that refer to projections, forecasts or
other characterizations of future events or circumstances,
including any underlying assumptions, are forward-looking
statements. The words "anticipate", "believe", "continue", "could",
"estimate", "expect", "intend", "may", "might", "plan", "probable",
"potential", "should", "would" and similar expressions may identify
forward-looking statements, but the absence of these words does not
mean that a statement is not forward-looking.
The forward-looking statements in this press release are based
upon various assumptions, many of which are based, in turn, upon
further assumptions, including without limitation, management's
examination and analysis of the existing law, rules and regulations
and other data available from third parties. Although we believe
that these assumptions were reasonable when made, because these
assumptions are inherently subject to significant uncertainties and
contingencies which are difficult or impossible to predict and are
beyond our control, we cannot assure you the statement herein will
be accurate. As a result, you are cautioned not to rely on any
forward-looking statements.
CONTACT:
The Company:
Mr. Jay Yu
Chief Financial Officer
Tel: +86-10-6506-5217
Email: ir@luokung.com
Investor Relations:
Ms. Carolyne Sohn
Vice President
The Equity Group Inc.
Tel: 415-568-2255
Email: csohn@equityny.com
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SOURCE Luokung Technology Corp.