CXAI Partners with TouchSource Amid Ongoing Financial Struggles

What happened

CXApp Inc. has announced a strategic partnership with TouchSource to integrate its agentic AI platform with TouchSource's digital directory network across commercial real estate and healthcare venues. This collaboration aims to enhance in-venue experiences through joint marketing and sales efforts, leveraging TouchSource's over 11,000 U.S. deployments. However, CXAI is grappling with declining revenue, which fell 41% year-over-year in Q3 2025 to $1.1 million, and persistent operating losses of around $3 million per quarter. The company also faces a critical Nasdaq delisting risk due to its sub-$1 share price, with a cure deadline approaching in March 2026. While this partnership aligns with CXAI's focus on scaling its AI ecosystem, it does not immediately resolve its financial instability or dilution concerns from ongoing ATM financings.

Implication

The partnership with TouchSource could provide CXAI with access to new commercial real estate customers, potentially boosting ARR if deployments convert successfully. However, given CXAI's small revenue base and high cash burn, any revenue impact will likely be gradual and may not offset operating losses in the short term. Investors should monitor upcoming earnings for signs of revenue stabilization or new customer wins tied to this deal. The Nasdaq delisting risk remains a key overhang, requiring a share price recovery or reverse split to avoid potential equity impairment. Therefore, while strategically positive, this news does not alter the need for caution until clearer financial sustainability is demonstrated.

Thesis delta

The partnership adds to CXAI's ecosystem efforts but does not shift the investment thesis, as core risks like revenue stagnation, cash burn, and delisting concerns persist. Investors should continue to wait for evidence of sustainable revenue growth and ARR expansion before considering an entry, as highlighted in the 'WAIT' rating.