On Thursday, shares of Siyata Mobile (US:SYTA) traded 15.5% higher following the Nasdaq index’s monster 7.4% lead and recovering November’s losses. After the markets closed, Siyata provided its third quarter update to investors.

Despite the strong rally into the earnings release, Siyata recently experienced immense selling pressure with shares gapping down more than 50% on investor concerns during October after the company announced that it would be raising capital.

Siyata, with the help of Maxim Group planned to raise $4 million in capital through the issuance of 15.8 million new shares at 23 cents per share, as well as 1.59 million in pre-funded warrants. The new issuance will significantly dilute existing holders with the Fintel platform reporting 17.88 million shares of the float currently on issue.

For the third quarter, Siyata grew revenues by 111% to $2.57 million from $1.22 million in the prior year. The revenue also came in well ahead of the $1 million generated in the prior quarter.

Gross profits expanded to $856K from $423K as the growth in sales outpaced cost growth for the sales.

The firm’s adjusted EBITDA loss narrowed to -$1.58 million from -$4.87 million in 2021 and the net loss improved even more to -$500K from -$5.67 million in the prior period.

Siyata’s CEO and Founder Marc Seelenfreund commented on the result highlighting to investors, “Our improved financial performance was driven primarily by a number of customer trials of our SD7 rugged push-to-talk device, which began shipping in the second quarter, many of which then converted into purchase orders with volumes in Q3 that increased over Q2”

Seelenfreund believes the rapid adoption of Siyata’s SD7 product line is only beginning to ramp up.

Following the initial digest of the result, SYTA’s traded up a further 7% in after hours trading.

The company plans to expand its target customer market from only first responders to other sectors including: government, schools, utilities, security companies, defense contractors, amusement parks, and hotel resorts and more.

Looking ahead, management expects to see growth in various product categories and strong growth in the Rugged Handset product category.

Siyata remains focused on winning new customers, more carrier launches, further product upgrades and a primary goal to see strong organic growth to lead to profitability.

In the lead-up to the result, Maxim Group’s analyst Jack Vander Aarde cut his target price on the stock from $3.00 to $0.50 on lower revised estimates and dilution from the equity raise.

Despite the reduction in valuation, Aarde still believes Siyata is heading towards an inflection point with the SD7 set being the strongest growth driver. The firm also highlighted that at current levels, the stock represents compelling valuation prospects.

SYTA has risen 39 ranks this week in popularity with retail investors and is now the 330th most held security. The average position size is $1.5K across holders. You can access this retail trade data for free by linking your portfolio here.

This article originally appeared on Fintel

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