Quick Update on iLearningEngines

At first sight, it looks like a disaster:

However, there is a simple explanation:

• On July 22, 2024, the company files a registration statement for existing shares

• This registration statement became effective, Friday, making the shares tradable.

• While the number is large (100M shares), this isn’t dilution, just registration of existing shares.

• Could this create overhang? Yes, of course, but the founder/CEO owns 70% of the company and he said he isn’t selling anytime soon.

• Meanwhile, the math hasn’t changed, tomorrow morning the company will present Q2 earnings, 97% of revenue is recurring which makes a big miss quite unlikely.

• We think it presents an opportunity here at $3, even if it could go lower on the overhang.

• The company solves a real problem, enabling businesses to apply AI to their organization with a platform that enables a quick build of AI-driven apps.

• The company touts a NRR of 132%, existing customers expand the use of the platform.