ADDvantage Technologies (AEYGQ) 10-Q14 Nov 222022 Q3 Quarterly reportFinancial data

Company Profile

Cover Page

Cover Page - shares	9 Months Ended
Cover Page - shares	Sep. 30, 2022	Nov. 09, 2022
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2022
Document Transition Report	false
Entity File Number	1-10799
Entity Registrant Name	ADDvantage Technologies Group, Inc.
Entity Incorporation, State or Country Code	OK
Entity Tax Identification Number	73-1351610
Entity Address, Address Line One	1430 Bradley Lane, Suite 196
Entity Address, City or Town	Carrollton
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	75007
City Area Code	(918)
Local Phone Number	251-9121
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		14,019,642
Entity Central Index Key	0000874292
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Amendment Flag	false

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 4,923	$ 1,837
Restricted cash	1,785	581
Accounts receivable, net of allowances of $250, respectively	2,403	6,469
Unbilled revenue	2,578	2,219
Inventories, net of allowances of $3,831 and $3,567, respectively	8,665	5,653
Prepaid expenses and other assets	1,648	1,371
Total current assets	22,002	18,130
Machinery and equipment	5,131	5,354
Leasehold improvements	899	821
Total property and equipment, at cost	6,030	6,175
Less: Accumulated depreciation	(2,828)	(2,558)
Net property and equipment	3,202	3,617
Right-of-use lease assets	1,776	2,466
Intangibles, net of accumulated amortization	788	1,027
Goodwill	58	58
Other assets	124	128
Total assets	27,950	25,426
Current liabilities:
Accounts payable	9,025	6,812
Accrued expenses	1,771	1,184
Deferred revenue	287	207
Bank line of credit	0	2,050
Right-of-use lease obligations, current	1,235	1,177
Finance lease obligations, current	573	652
Other current liabilities	567	706
Total current liabilities	13,458	12,788
Right-of-use lease obligations, long-term	905	1,839
Finance lease obligations, long-term	1,117	1,484
Total liabilities	15,480	16,111
Shareholders’ equity:
Common stock, $0.01 par value; 30,000,000 shares authorized; 14,043,642 and 13,041,127 shares issued and outstanding, respectively	140	130
Paid in capital	2,516	335
Retained earnings	9,814	8,850
Total shareholders’ equity	12,470	9,315
Total liabilities and shareholders’ equity	$ 27,950	$ 25,426

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Allowance for doubtful accounts	$ 250	$ 250
Allowance for excess and obsolete inventory	$ 3,831	$ 3,567
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	30,000,000	30,000,000
Common stock, shares issued (in shares)	14,043,642	13,041,127
Common stock, shares outstanding (in shares)	14,043,642	13,041,127

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Income Statement [Abstract]
Sales	$ 25,926	$ 19,727	$ 77,474	$ 49,411
Cost of sales	17,383	14,679	55,026	36,913
Gross profit	8,543	5,048	22,448	12,498
Operating expenses	2,303	2,607	7,600	7,282
Selling, general and administrative expenses	4,464	4,357	12,459	11,675
Depreciation and amortization expense	295	329	925	947
Gain on disposal of assets	311	10	309	23
Income (loss) from operations	1,792	(2,235)	1,773	(7,383)
Other income (expense):
Gain on extinguishment of debt	0	2,955	0	2,955
Interest income	0	20	0	87
Other expense, net	(273)	(49)	(675)	(91)
Interest expense	(36)	(82)	(134)	(170)
Other income (expense), net	(309)	2,844	(809)	2,781
Income (loss) before income taxes	1,483	609	964	(4,602)
Benefit for income taxes	0	(30)	0	(53)
Net income (loss)	$ 1,483	$ 639	$ 964	$ (4,549)
Income (loss) per share:
Basic (in dollars per share)	$ 0.11	$ 0.05	$ 0.07	$ (0.36)
Diluted (in dollars per share)	$ 0.11	$ 0.05	$ 0.07	$ (0.36)
Shares used in per share calculation:
Basic (in shares)	13,638,162	12,543,727	13,302,410	12,485,719
Diluted (in shares)	13,638,162	12,543,727	13,302,410	12,485,719
Product, Sales	Product [Member]	Product [Member]	Product [Member]	Product [Member]

Consolidated Statements of Chan

Consolidated Statements of Changes in Shareholders' Equity - USD ($) $ in Thousands	Total	Common Stock	Paid-in Capital	Retained Earnings
Beginning balance (in shares) at Dec. 31, 2020		12,366,593
Beginning Balance at Dec. 31, 2020	$ 14,174	$ 124	$ (1,379)	$ 15,429
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(3,064)			(3,064)
Common stock issuance (in shares)		7,779
Common stock issuance	21		21
Restricted stock issuance, net of forfeitures (in shares)		(10,000)
Restricted stock issuance, net of forfeitures	(1)	$ (1)
Stock option exercise (in shares)		49,000
Stock option exercise	89		89
Amortization of stock-based compensation	246		246
Ending balance (in shares) at Mar. 31, 2021		12,413,372
Ending Balance at Mar. 31, 2021	11,466	$ 124	(1,023)	12,364
Beginning balance (in shares) at Dec. 31, 2020		12,366,593
Beginning Balance at Dec. 31, 2020	14,174	$ 124	(1,379)	15,429
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(4,549)
Ending balance (in shares) at Sep. 30, 2021		12,610,229
Ending Balance at Sep. 30, 2021	10,427	$ 126	(578)	10,879
Beginning balance (in shares) at Mar. 31, 2021		12,413,372
Beginning Balance at Mar. 31, 2021	11,466	$ 124	(1,023)	12,364
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(2,124)			(2,124)
Restricted stock issuance (in shares)		98,000
Restricted stock issuance	0	$ 1	(1)
Amortization of stock-based compensation	279		279
Ending balance (in shares) at Jun. 30, 2021		12,511,372
Ending Balance at Jun. 30, 2021	9,620	$ 125	(745)	10,240
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	639			639
Restricted stock issuance (in shares)		98,857
Restricted stock issuance	0	$ 1	(1)
Stock option exercise	0	$ 1	(1)
Amortization of stock-based compensation	169		169
Ending balance (in shares) at Sep. 30, 2021		12,610,229
Ending Balance at Sep. 30, 2021	$ 10,427	$ 126	(578)	10,879
Beginning balance (in shares) at Dec. 31, 2021	13,041,127	13,041,127
Beginning Balance at Dec. 31, 2021	$ 9,315	$ 130	335	8,850
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(1,394)			(1,394)
Common stock issuance (in shares)		143,985
Common stock issuance	168	$ 2	166
Restricted stock issuance (in shares)		4,000
Restricted stock issuance	0	$ 0	0
Amortization of stock-based compensation	247		247
Ending balance (in shares) at Mar. 31, 2022		13,189,112
Ending Balance at Mar. 31, 2022	$ 8,336	$ 132	748	7,456
Beginning balance (in shares) at Dec. 31, 2021	13,041,127	13,041,127
Beginning Balance at Dec. 31, 2021	$ 9,315	$ 130	335	8,850
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	$ 964
Ending balance (in shares) at Sep. 30, 2022	14,043,642	14,043,642
Ending Balance at Sep. 30, 2022	$ 12,470	$ 140	2,516	9,814
Beginning balance (in shares) at Mar. 31, 2022		13,189,112
Beginning Balance at Mar. 31, 2022	8,336	$ 132	748	7,456
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	875			875
Common stock issuance (in shares)		30,745
Common stock issuance	38		38
Restricted stock forfeitures (in shares)		(51,666)
Restricted stock forfeitures	0	$ (1)	1
Amortization of stock-based compensation	103		103
Ending balance (in shares) at Jun. 30, 2022		13,168,191
Ending Balance at Jun. 30, 2022	9,353	$ 132	890	8,331
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	1,483			1,483
Common stock issuance (in shares)		717,451
Common stock issuance	1,421	$ 7	1,414
Restricted stock issuance, net of forfeitures (in shares)		108,000
Restricted stock issuance, net of forfeitures	0	$ 1	(1)
Stock option exercise (in shares)		50,000
Stock option exercise	64	$ 1	63
Amortization of stock-based compensation	$ 150		150
Ending balance (in shares) at Sep. 30, 2022	14,043,642	14,043,642
Ending Balance at Sep. 30, 2022	$ 12,470	$ 140	$ 2,516	$ 9,814

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Operating Activities:
Net income (loss)	$ 964	$ (4,549)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation	686	709
Amortization	239	238
Non cash amortization of right-of-use asset and liability	(187)	(236)
Provision for excess and obsolete inventories	265	422
Charge for lower of cost or net realizable value inventories	0	105
Stock based compensation expense	500	694
Gain from disposal of property and equipment	(212)	(13)
Gain on extinguishment of debt	0	(2,955)
Changes in assets and liabilities:
Accounts receivable	4,066	(2,203)
Unbilled revenue	(359)	(1,337)
Income tax receivable/payable	0	1,249
Inventories	(3,276)	(249)
Prepaid expenses and other assets	(273)	(384)
Accounts payable	2,213	3,516
Accrued expenses and other liabilities	448	1,148
Deferred revenue	80	42
Net cash provided by (used in) operating activities	5,154	(3,803)
Investing Activities:
Proceeds from promissory note receivable	0	2,270
Purchases of property and equipment	(209)	(226)
Disposals of property and equipment	423	18
Net cash provided by investing activities	214	2,062
Financing Activities:
Payments on bank line of credit	(2,050)	(750)
Payments on financing lease obligations	(719)	(398)
Payments on notes payable	0	55
Proceeds from sale of common stock	1,627	21
Proceeds from stock options exercised	64	89
Net cash used in financing activities	(1,078)	(983)
Net increase (decrease) in cash, cash equivalents and restricted cash	4,290	(2,724)
Cash, cash equivalents and restricted cash at beginning of period	2,418	5,666
Cash, cash equivalents and restricted cash at end of period	$ 6,708	$ 2,942

Basis of Presentation and Accou

Basis of Presentation and Accounting Policies	9 Months Ended
Basis of Presentation and Accounting Policies	Sep. 30, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation and Accounting Policies	Basis of Presentation and Accounting Policies Basis of presentation The consolidated financial statements include the accounts of ADDvantage Technologies Group, Inc. and its subsidiaries, all of which are wholly owned (collectively, the “Company”). Intercompany balances and transactions have been eliminated in consolidation. The Company’s reportable segments are Wireless Infrastructure Services (“Wireless”) and Telecommunications (“Telco”). The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial statements and do not include all the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. However, the information furnished reflects all adjustments, which are, in the opinion of management, necessary in order to make the unaudited consolidated financial statements not misleading. The Company’s business is subject to seasonal variations due to weather in the geographic areas where services are performed, as well as calendar events and national holidays. Therefore, the results of operations for the nine months ended September 30, 2022 and 2021, are not necessarily indicative of the results to be expected for the full fiscal year. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2021. Change in year end In September 2022, the Company's Board of Directors approved a change in the Company's fiscal year end from September 30 to December 31, effective for the fiscal year beginning January 1, 2022. As a result of the change in year end, the Company filed a Transition Report on Form 10-Q for the period from October 1, 2021 through December 31, 2021. The Company's fiscal year will run from January 1, 2022 through December 31, 2022. Recently Issued Accounting Standards In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-13: “Financial Instruments – Credit Losses (Topic 326) – Measurement of Credit Losses on Financial Instruments.” This ASU requires entities to measure all expected credit losses for most financial assets held at the reporting date based on an expected loss model which includes historical experience, current conditions, and reasonable and supportable forecasts. Upon adoption, entities will use forward-looking information to better form their credit loss estimates. This ASU also requires enhanced disclosures to help financial statement users better understand significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an entity’s portfolio. On November 15, 2019, the FASB delayed the effective date of the standard for companies that qualify under smaller reporting company reporting rules. As amended, the effective date of ASC Topic 326 was delayed until fiscal years beginning after December 15, 2022 for SEC filers that are eligible to be smaller reporting companies under the Securities and Exchange Commission definition. We are currently in the process of evaluating this new standard update, however we do not anticipate the adoption will have a material impact on our results.

Revenue Recognition

Revenue Recognition	9 Months Ended
Revenue Recognition	Sep. 30, 2022
Revenue from Contract with Customer [Abstract]
Revenue Recognition	Revenue Recognition The Company’s principal sales are from Wireless services, sales of Telco equipment and Telco recycled equipment, primarily in the United States. Sales to international customers totaled approximately $1.1 million and $1.7 million for the three months ended September 30, 2022 and 2021, respectively, and $4.6 million and $4.3 million for the nine months ended September 30, 2022 and 2021, respectively. The Company’s customers include wireless carriers, wireless equipment providers, multiple system operators, resellers and direct sales to end-user customers. Sales, which individually amounted to 10% or greater of the Company's revenue, to two customers totaled 30%, and to one customer totaled 20% of consolidated revenues for the nine months ended September 30, 2022 and 2021, respectively. Our sales by type were as follows, in thousands: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Wireless services sales $ 7,898 $ 6,992 $ 22,907 $ 15,462 Telco equipment 18,028 12,272 54,363 33,287 Telco repair — 13 12 21 Telco recycle — 450 192 641 Total sales $ 25,926 $ 19,727 $ 77,474 $ 49,411 Contract assets and contract liabilities are included in unbilled revenue and deferred revenue, respectively, in the consolidated balance sheets. At September 30, 2022 and December 31, 2021, contract assets were $2.6 million and $2.2 million, respectively, and contract liabilities were $0.3 million and $0.2 million, respectively. The Company recognized $0.2 million of contract revenue during the nine months ended September 30, 2022 related to contract liabilities recorded in deferred revenue at December 31, 2021.

Accounts Receivable Agreements

Accounts Receivable Agreements	9 Months Ended
Accounts Receivable Agreements	Sep. 30, 2022
Receivables [Abstract]
Accounts Receivable Agreements	Accounts Receivable Agreements On March 17, 2022, the Company replaced its $3.0 million credit facility for its Nave and Triton subsidiaries with its primary financial lender with new accounts receivable purchase facilities with capacities of $12.5 million for Nave and $3.0 million for Triton. The lender charges a fee of 1.3% of sold receivables, and both facilities mature on March 17, 2023. On March 17, 2022, the Company also restructured its accounts receivable purchase facilities secured by the Company’s Fulton subsidiary’s receivables. Under the restructure, the credit capacity excluding a major customer is $1.0 million, with a fee of 1.6% of sold receivables. The credit capacity secured by receivables of a major customer is $2.5 million, with a fee of 1.5% of sold receivables. The facilities mature on December 17, 2022. For all four facilities, the lender advances the Company 90% of sold receivables and establishes a reserve of 10% of the sold receivables at initial sale, which increases to 100% over time after 120 days, until the Company collects the sold receivables. The Company has a total capacity under all four facilities of $19.0 million, which has been reallocated between the facilities to accommodate current needs. As of September 30, 2022, the lender has a reserve against the sold receivables of $1.8 million, which is reflected as restricted cash on the consolidated balance sheets. The facilities agreements address events and conditions which may obligate the Company to immediately repay the institution the outstanding purchase price of the receivables sold. The total amount of receivables uncollected by the institution was $11.0 million at September 30, 2022 for which there is a limit of $19.0 million. Although the sale of receivables is with recourse, the Company did not record a recourse obligation at September 30, 2022 as the Company concluded that the sold receivables are collectible. For the nine months ended September 30, 2022 and 2021, the Company received proceeds from the sold receivables from all of the facilities of $59.8 million and $13.3 million, respectively, and included the proceeds in net cash provided by or used in operating activities in the consolidated statements of cash flows. The Company recorded costs of $0.8 million and $0.1 million for the nine months ended September 30, 2022 and 2021, respectively, in other expense in the consolidated statements of operations.

Inventories

Inventories	9 Months Ended
Inventories	Sep. 30, 2022
Inventory Disclosure [Abstract]
Inventories	Inventories Inventories, which are all within the Telco segment, at September 30, 2022 and December 31, 2021 are as follows, in thousands: September 30, 2022 December 31, 2021 New equipment $ 2,192 $ 1,396 Refurbished and used equipment 10,304 7,824 Allowance for excess and obsolete inventory (3,831) (3,567) Total inventories, net $ 8,665 $ 5,653

Intangible Assets

Intangible Assets	9 Months Ended
Intangible Assets	Sep. 30, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible Assets	Intangible Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the asset’s carrying amount may not be recoverable. The Company groups assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities and evaluate the asset group against the sum of the undiscounted future cash flows. If the undiscounted future cash flows do not indicate the carrying amount of the asset is recoverable, an impairment charge is measured as the amount by which the carrying amount of the asset group exceeds its fair value based on discounted cash flow analysis or appraisals. Intangible assets with their associated accumulated amortization at September 30, 2022 and December 31, 2021 are as follows, in thousands: September 30, 2022 Intangible assets: Gross Accumulated Amortization Net Customer relationships – 10 years $ 3,155 $ (2,886) $ 269 Trade name – 10 years 2,122 (1,603) 519 Total intangible assets $ 5,277 $ (4,489) $ 788 December 31, 2021 Intangible assets: Gross Accumulated Net Customer relationships – 10 years $ 3,155 $ (2,807) $ 348 Trade name – 10 years 2,122 (1,443) 679 Total intangible assets $ 5,277 $ (4,250) $ 1,027

Debt

Debt	9 Months Ended
Debt	Sep. 30, 2022
Debt Disclosure [Abstract]
Debt	Debt Credit Agreement On March 17, 2022, the Company closed its $3.0 million credit facility for its Nave and Triton subsidiaries with its primary financial lender. See Note 3 - Accounts Receivable Agreements for more information about the Company's receivables purchase facilities.

Equity Distribution Agreement a

Equity Distribution Agreement and Sale of Common Stock	9 Months Ended
Equity Distribution Agreement and Sale of Common Stock	Sep. 30, 2022
Equity [Abstract]
Equity Distribution Agreement and Sale of Common Stock	Equity Distribution Agreement and Sale of Common Stock On April 24, 2020, the Company entered into an Equity Distribution Agreement with Northland Securities, Inc., as agent (“Northland”), pursuant to which the Company may offer and sell, from time to time, through Northland, shares of the Company’s common stock, par value 0.01 per share, having an aggregate offering price of up to $13.9 million ("Shares"). The offer and sale of the Shares will be made pursuant to a shelf registration statement on Form S-3 and the related prospectus filed by the Company with the Securities and Exchange Commission (the “SEC”) on March 3, 2020, as amended on March 23, 2020, and declared effective by the SEC on April 1, 2020. Pursuant to the Sales Agreement, Northland may sell the Shares by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415 of the Securities Act of 1933 (the “Securities Act”), including sales made by means of ordinary brokers’ transactions, including on The Nasdaq Global Market, at market prices or as otherwise agreed with Northland. Northland will use commercially reasonable efforts consistent with its normal trading and sales practices to sell the Shares from time to time, based upon instructions from the Company, including any price or size limits or other customary parameters or conditions the Company may impose. The Sales Agreement may be terminated without prior notice at any time prior to the fulfillment if additional sales are deemed not warranted.

Earnings per Share

Earnings per Share	9 Months Ended
Earnings per Share	Sep. 30, 2022
Earnings Per Share [Abstract]
Earnings Per Share	Earnings Per Share Basic and diluted earnings per share for the three and nine months ended September 30, 2022 and 2021 are (in thousands, except per share amounts): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Net income (loss) attributable to common shareholders $ 1,483 $ 639 $ 964 $ (4,549) Basic and diluted weighted average shares 13,638,162 12,543,727 13,302,410 12,485,719 Basic and diluted income (loss) per common share $ 0.11 $ 0.05 $ 0.07 $ (0.36) The table below includes information related to stock options that were outstanding at the end of each respective three and nine month period ended September 30, but have been excluded from the computation of weighted-average stock options for dilutive securities because their effect would be anti-dilutive. Three Months Ended September 30, Nine Months Ended 2022 2021 2022 2021 Stock options excluded — 50,000 — 50,000 Weighted average exercise price of stock options $ 1.28 $ 1.28 Average market price of common stock $ 2.45 $ 2.58

Supplemental Cash Flow Informat

Supplemental Cash Flow Information	9 Months Ended
Supplemental Cash Flow Information	Sep. 30, 2022
Supplemental Cash Flow Elements [Abstract]
Supplemental Cash Flow Information	Supplemental Cash Flow Information (in thousands) Nine Months Ended September 30, 2022 2021 Supplemental cash flow information: Cash paid for interest $ 134 $ 214 Supplemental noncash investing and financing activities: Assets acquired under financing leases $ 273 $ 1,589

Stock-Based Compensation

Stock-Based Compensation	9 Months Ended
Stock-Based Compensation	Sep. 30, 2022
Share-Based Payment Arrangement [Abstract]
Stock-Based Compensation	Stock-Based Compensation Plan Information The 2015 Incentive Stock Plan (the “Plan”) provides for awards of stock options and restricted stock to officers, directors, key employees and consultants. In September 2022, at the Company's annual meeting of shareholders, the shareholders authorized an additional 1,000,000 shares of common stock be added to the Plan. At September 30, 2022, 3,100,415 shares of common stock were reserved for stock award grants under the Plan. Of these reserved shares, 1,160,695 shares were available for future grants. Stock Options As of December 31, 2021, there were 50,000 stock options with a weighted average exercise price of $1.28 per share and an aggregate intrinsic value of $22 thousand outstanding under the Plan. There were 50,000 stock options exercised during the nine months ended September 30, 2022. As of September 30, 2022, no stock options remained outstanding. Restricted stock awards A summary of the Company's non-vested restricted share awards at September 30, 2022 and changes during the quarter ended September 30, 2022 is presented in the following table (in thousands, except shares): Shares Fair Value Non-vested at June 30, 2022 531,787 $ 1,228 Granted 108,000 146 Vested (107,190) (269) Forfeited — — Non-vested at September 30, 2022 532,597 $ 1,105 During the three month period ended September 30, 2022 and 2021, expenses related to share-based arrangements including restricted stock and stock option awards, were $0.1 million and $0.2 million, respectively. During the nine month period ended September 30, 2022 and 2021, compensation expenses related to share-based arrangements including restricted stock and stock option awards, were $0.5 million and $0.7 million respectively. The Company did not recognize a tax benefit for compensation expense recognized during the three and nine month period ended September 30, 2022 and 2021. At September 30, 2022, unrecognized compensation expense related to non-vested stock-based compensation awards not yet recognized in the consolidated statements of operations was $0.4 million. That cost is expected to be recognized over a period of 2.75 years.

Leases

Leases	9 Months Ended
Leases	Sep. 30, 2022
Leases [Abstract]
Leases	Leases Our Wireless segment has an operating lease for a building in Fridley, Minnesota for Fulton Technologies, Inc. As a result of closing down and vacating Fulton Technologies, Inc.’s Minnesota office in May 2019, a third-party telecom company began subleasing this building in June 2019. The lease term expired on December 31, 2021. Our Telco segment has an operating lease for a building in Jessup, Maryland for Nave Communications. As a result of moving Nave’s operations to Palco Telecom, a third-party logistics provider in Huntsville, Alabama, in fiscal year 2020, Nave completely vacated the building in May 2020 and has subleased the building through the end of the lease period.

Segment Reporting

Segment Reporting	9 Months Ended
Segment Reporting	Sep. 30, 2022
Segment Reporting [Abstract]
Segment Reporting	Segment Reporting The Company is reporting its financial performance based on its external reporting segments: Wireless Infrastructure Services and Telecommunications. These reportable segments are described below. Wireless Infrastructure Services (“Wireless”) The Company's Wireless segment provides turn-key wireless infrastructure services for the four major U.S. wireless carriers, communication tower companies, national integrators, and original equipment manufacturers that support these wireless carriers. These services primarily consist of the installation and upgrade of technology on cell sites and the construction of new small cells for 5G. Telecommunications (“Telco”) The Company’s Telco segment sells new and refurbished telecommunications networking equipment, including both central office and customer premise equipment, to its customer base of telecommunications providers, enterprise customers and resellers located primarily in North America. This segment also offers its customers repair and testing services for telecommunications networking equipment. The Company evaluates performance and allocates its resources based on operating income. The accounting policies of its reportable segments are the same as those described in the summary of significant accounting policies. Segment assets consist primarily of cash and cash equivalents, accounts receivable, inventory, property and equipment, goodwill and intangible assets. The Company allocates its corporate general and administrative expenses to the reportable segments. Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2022 2021 2022 2021 Sales Wireless $ 7,898 $ 6,992 $ 22,908 $ 15,462 Telco 18,028 12,735 54,566 33,949 Total sales $ 25,926 $ 19,727 $ 77,474 $ 49,411 Gross profit Wireless $ 2,839 $ 1,908 $ 6,350 $ 4,668 Telco 5,704 3,140 16,098 7,830 Total gross profit (loss) $ 8,543 $ 5,048 $ 22,448 $ 12,498 Income (loss) from operations Wireless $ (202) $ (2,105) $ (3,859) $ (5,759) Telco 1,994 (130) 5,632 (1,624) Total income (loss) from operations $ 1,792 $ (2,235) $ 1,773 $ (7,383) (in thousands) September 30, 2022 December 31, 2021 Segment assets Wireless $ 7,655 $ 7,640 Telco 14,340 14,545 Non-allocated 5,955 3,241 Total assets $ 27,950 $ 25,426

Basis of Presentation and Acc_2

Basis of Presentation and Accounting Policies (Policies)	9 Months Ended
Basis of Presentation and Accounting Policies (Policies)	Sep. 30, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of presentation	Basis of presentation The consolidated financial statements include the accounts of ADDvantage Technologies Group, Inc. and its subsidiaries, all of which are wholly owned (collectively, the “Company”). Intercompany balances and transactions have been eliminated in consolidation. The Company’s reportable segments are Wireless Infrastructure Services (“Wireless”) and Telecommunications (“Telco”). The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial statements and do not include all the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. However, the information furnished reflects all adjustments, which are, in the opinion of management, necessary in order to make the unaudited consolidated financial statements not misleading. The Company’s business is subject to seasonal variations due to weather in the geographic areas where services are performed, as well as calendar events and national holidays. Therefore, the results of operations for the nine months ended September 30, 2022 and 2021, are not necessarily indicative of the results to be expected for the full fiscal year. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2021.
Recently Issued Accounting Standards	Recently Issued Accounting Standards In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-13: “Financial Instruments – Credit Losses (Topic 326) – Measurement of Credit Losses on Financial Instruments.” This ASU requires entities to measure all expected credit losses for most financial assets held at the reporting date based on an expected loss model which includes historical experience, current conditions, and reasonable and supportable forecasts. Upon adoption, entities will use forward-looking information to better form their credit loss estimates. This ASU also requires enhanced disclosures to help financial statement users better understand significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an entity’s portfolio. On November 15, 2019, the FASB delayed the effective date of the standard for companies that qualify under smaller reporting company reporting rules. As amended, the effective date of ASC Topic 326 was delayed until fiscal years beginning after December 15, 2022 for SEC filers that are eligible to be smaller reporting companies under the Securities and Exchange Commission definition. We are currently in the process of evaluating this new standard update, however we do not anticipate the adoption will have a material impact on our results.
Change in year end	Change in year end In September 2022, the Company's Board of Directors approved a change in the Company's fiscal year end from September 30 to December 31, effective for the fiscal year beginning January 1, 2022. As a result of the change in year end, the Company filed a Transition Report on Form 10-Q for the period from October 1, 2021 through December 31, 2021. The Company's fiscal year will run from January 1, 2022 through December 31, 2022.

Revenue Recognition (Tables)

Revenue Recognition (Tables)	9 Months Ended
Revenue Recognition (Tables)	Sep. 30, 2022
Revenue from Contract with Customer [Abstract]
Schedule of Disaggregation of Revenue	Our sales by type were as follows, in thousands: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Wireless services sales $ 7,898 $ 6,992 $ 22,907 $ 15,462 Telco equipment 18,028 12,272 54,363 33,287 Telco repair — 13 12 21 Telco recycle — 450 192 641 Total sales $ 25,926 $ 19,727 $ 77,474 $ 49,411

Inventories (Tables)

Inventories (Tables)	9 Months Ended
Inventories (Tables)	Sep. 30, 2022
Inventory Disclosure [Abstract]
Schedule of Inventories	Inventories, which are all within the Telco segment, at September 30, 2022 and December 31, 2021 are as follows, in thousands: September 30, 2022 December 31, 2021 New equipment $ 2,192 $ 1,396 Refurbished and used equipment 10,304 7,824 Allowance for excess and obsolete inventory (3,831) (3,567) Total inventories, net $ 8,665 $ 5,653

Intangible Assets (Tables)

Intangible Assets (Tables)	9 Months Ended
Intangible Assets (Tables)	Sep. 30, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of Intangible Assets and Goodwill	Intangible assets with their associated accumulated amortization at September 30, 2022 and December 31, 2021 are as follows, in thousands: September 30, 2022 Intangible assets: Gross Accumulated Amortization Net Customer relationships – 10 years $ 3,155 $ (2,886) $ 269 Trade name – 10 years 2,122 (1,603) 519 Total intangible assets $ 5,277 $ (4,489) $ 788 December 31, 2021 Intangible assets: Gross Accumulated Net Customer relationships – 10 years $ 3,155 $ (2,807) $ 348 Trade name – 10 years 2,122 (1,443) 679 Total intangible assets $ 5,277 $ (4,250) $ 1,027

Earnings Per Share (Tables)

Earnings Per Share (Tables)	9 Months Ended
Earnings Per Share (Tables)	Sep. 30, 2022
Earnings Per Share [Abstract]
Schedule of Earnings Per Share, Basic and Diluted	Basic and diluted earnings per share for the three and nine months ended September 30, 2022 and 2021 are (in thousands, except per share amounts): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Net income (loss) attributable to common shareholders $ 1,483 $ 639 $ 964 $ (4,549) Basic and diluted weighted average shares 13,638,162 12,543,727 13,302,410 12,485,719 Basic and diluted income (loss) per common share $ 0.11 $ 0.05 $ 0.07 $ (0.36)
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share	The table below includes information related to stock options that were outstanding at the end of each respective three and nine month period ended September 30, but have been excluded from the computation of weighted-average stock options for dilutive securities because their effect would be anti-dilutive. Three Months Ended September 30, Nine Months Ended 2022 2021 2022 2021 Stock options excluded — 50,000 — 50,000 Weighted average exercise price of stock options $ 1.28 $ 1.28 Average market price of common stock $ 2.45 $ 2.58

Supplemental Cash Flow Inform_2

Supplemental Cash Flow Information (Tables)	9 Months Ended
Supplemental Cash Flow Information (Tables)	Sep. 30, 2022
Supplemental Cash Flow Elements [Abstract]
Schedule of Cash Flow, Supplemental Disclosures	(in thousands) Nine Months Ended September 30, 2022 2021 Supplemental cash flow information: Cash paid for interest $ 134 $ 214 Supplemental noncash investing and financing activities: Assets acquired under financing leases $ 273 $ 1,589

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	9 Months Ended
Stock-Based Compensation (Tables)	Sep. 30, 2022
Share-Based Payment Arrangement [Abstract]
Schedule of Disclosure of Share-based Compensation Arrangements by Share-based Payment Award	A summary of the Company's non-vested restricted share awards at September 30, 2022 and changes during the quarter ended September 30, 2022 is presented in the following table (in thousands, except shares): Shares Fair Value Non-vested at June 30, 2022 531,787 $ 1,228 Granted 108,000 146 Vested (107,190) (269) Forfeited — — Non-vested at September 30, 2022 532,597 $ 1,105

Segment Reporting (Tables)

Segment Reporting (Tables)	9 Months Ended
Segment Reporting (Tables)	Sep. 30, 2022
Segment Reporting [Abstract]
Schedule of Segment Reporting Information, by Segment	The Company evaluates performance and allocates its resources based on operating income. The accounting policies of its reportable segments are the same as those described in the summary of significant accounting policies. Segment assets consist primarily of cash and cash equivalents, accounts receivable, inventory, property and equipment, goodwill and intangible assets. The Company allocates its corporate general and administrative expenses to the reportable segments. Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2022 2021 2022 2021 Sales Wireless $ 7,898 $ 6,992 $ 22,908 $ 15,462 Telco 18,028 12,735 54,566 33,949 Total sales $ 25,926 $ 19,727 $ 77,474 $ 49,411 Gross profit Wireless $ 2,839 $ 1,908 $ 6,350 $ 4,668 Telco 5,704 3,140 16,098 7,830 Total gross profit (loss) $ 8,543 $ 5,048 $ 22,448 $ 12,498 Income (loss) from operations Wireless $ (202) $ (2,105) $ (3,859) $ (5,759) Telco 1,994 (130) 5,632 (1,624) Total income (loss) from operations $ 1,792 $ (2,235) $ 1,773 $ (7,383) (in thousands) September 30, 2022 December 31, 2021 Segment assets Wireless $ 7,655 $ 7,640 Telco 14,340 14,545 Non-allocated 5,955 3,241 Total assets $ 27,950 $ 25,426

Revenue Recognition - Additiona

Revenue Recognition - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Disaggregation of Revenue [Line Items]
Total sales	$ 25,926	$ 19,727	$ 77,474	$ 49,411
Contract assets	2,578		2,578		$ 2,219
Contract liabilities	287		287		$ 207
Contract liabilities, revenue recognized			$ 200
Customer Concentration Risk \| Revenue Benchmark \| Two Customers
Disaggregation of Revenue [Line Items]
Concentration risk, percentage			30%
Customer Concentration Risk \| Revenue Benchmark \| One Customer
Disaggregation of Revenue [Line Items]
Concentration risk, percentage				20%
Non-US
Disaggregation of Revenue [Line Items]
Total sales	$ 1,100	$ 1,700	$ 4,600	$ 4,300

Revenue Recognition - Disaggreg

Revenue Recognition - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Disaggregation of Revenue [Line Items]
Total sales	$ 25,926	$ 19,727	$ 77,474	$ 49,411
Wireless services sales
Disaggregation of Revenue [Line Items]
Total sales	7,898	6,992	22,907	15,462
Telco equipment
Disaggregation of Revenue [Line Items]
Total sales	18,028	12,272	54,363	33,287
Telco repair
Disaggregation of Revenue [Line Items]
Total sales	0	13	12	21
Telco recycle
Disaggregation of Revenue [Line Items]
Total sales	$ 0	$ 450	$ 192	$ 641

Accounts Receivable Agreements

Accounts Receivable Agreements (Details)		9 Months Ended
Accounts Receivable Agreements (Details)	Mar. 17, 2022 USD ($) facility	Sep. 30, 2022 USD ($) facility	Sep. 30, 2021 USD ($)	Dec. 31, 2021 USD ($)
Accounts, Notes, Loans and Financing Receivable [Line Items]
Line of credit, maximum borrowing capacity	$ 3,000,000	$ 19,000,000
Increase period	120 days
Number of facilities \| facility		4
Restricted cash		$ 1,785,000		$ 581,000
Certain Receivables to Unrelated Third-parties
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accounts receivable agreement percent of sold receivables advanced, deduction	1.30%
Accounts receivable agreement number of facilities \| facility	4
Accounts receivable agreement, percent of sold receivables advanced	90%
Accounts receivable agreement, reserve of sold receivables, percent	10%
Accounts receivable agreement percent of sold receivables final percent	100%
Certain Receivables to Unrelated Third-parties \| Other Nonoperating Income (Expense)
Accounts, Notes, Loans and Financing Receivable [Line Items]
Proceeds from collection of finance receivables		59,800,000	$ 13,300,000
Cost of selling receivables		800,000	$ 100,000
Certain Receivables to Unrelated Third-parties \| Customer One
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accounts receivable maximum credit purchase capacity	$ 1,000,000
Accounts receivable sales percentage	1.60%
Certain Receivables to Unrelated Third-parties \| Customer Two
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accounts receivable maximum credit purchase capacity	$ 2,500,000
Accounts receivable sales percentage	1.50%
Uncollectible Receivables
Accounts, Notes, Loans and Financing Receivable [Line Items]
Thirty party financial institution reserve		$ 11,000,000
Nave
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accounts receivable maximum credit purchase capacity	$ 12,500,000
Triton
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accounts receivable maximum credit purchase capacity	$ 3,000,000

Inventories - Schedule of Inven

Inventories - Schedule of Inventory (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Inventory [Line Items]
Allowance for excess and obsolete inventory	$ (3,831)	$ (3,567)
Total inventories, net	8,665	5,653
New equipment
Inventory [Line Items]
Inventory, gross	2,192	1,396
Refurbished and used equipment
Inventory [Line Items]
Inventory, gross	$ 10,304	$ 7,824

Intangible Assets - Schedule of

Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
Finite-Lived Intangible Assets [Line Items]
Gross	$ 5,277	$ 5,277
Accumulated Amortization	(4,489)	(4,250)
Net	788	1,027
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Gross	3,155	3,155
Accumulated Amortization	(2,886)	(2,807)
Net	$ 269	$ 348
Useful life	10 years	10 years
Trade name
Finite-Lived Intangible Assets [Line Items]
Gross	$ 2,122	$ 2,122
Accumulated Amortization	(1,603)	(1,443)
Net	$ 519	$ 679
Useful life	10 years	10 years

Debt (Details)

Debt (Details) - USD ($)	Sep. 30, 2022	Mar. 17, 2022
Debt Disclosure [Abstract]
Line of credit, maximum borrowing capacity	$ 19,000,000	$ 3,000,000

Equity Distribution Agreement_2

Equity Distribution Agreement and Sale of Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021	Apr. 24, 2020
Subsidiary, Sale of Stock [Line Items]
Common stock, par value (in dollars per share)	$ 0.01		$ 0.01
Proceeds from issuance of common stock gross	$ 1,700
Proceeds from sale of common stock, gross	$ 1,627	$ 21
Sales Agreement With Northland
Subsidiary, Sale of Stock [Line Items]
Common stock, par value (in dollars per share)				$ 0.01
Maximum aggregate offering price				$ 13,900
Commission rate	3%
Common stock issuance (in shares)	892,181

Earnings Per Share - Basic and

Earnings Per Share - Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended						9 Months Ended
	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Sep. 30, 2022	Sep. 30, 2021
Earnings Per Share [Abstract]
Net income (loss) attributable to common shareholders	$ 1,483	$ 875	$ (1,394)	$ 639	$ (2,124)	$ (3,064)	$ 964	$ (4,549)
Basic weighted average shares (in shares)	13,638,162			12,543,727			13,302,410	12,485,719
Diluted weighted average shares (in shares)	13,638,162			12,543,727			13,302,410	12,485,719
Basic income (loss) per common share (in dollars per share)	$ 0.11			$ 0.05			$ 0.07	$ (0.36)
Diluted income (loss) per common share (in dollars per share)	$ 0.11			$ 0.05			$ 0.07	$ (0.36)

Earnings Per Share - Anti-dilut

Earnings Per Share - Anti-dilutive Securities (Details) - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Earnings Per Share [Abstract]
Stock options excluded (in shares)	0	50,000	0	50,000
Weighted average exercise price of stock options (in dollars per share)		$ 1.28		$ 1.28
Average market price of common stock (in dollars per share)		$ 2.45		$ 2.58

Supplemental Cash Flow Inform_3

Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Supplemental cash flow information:
Cash paid for interest	$ 134	$ 214
Supplemental noncash investing and financing activities:
Assets acquired under financing leases	$ 273	$ 1,589

Stock-Based Compensation - Addi

Stock-Based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options outstanding (in shares)	50,000		50,000		50,000
Weighted average exercise price (in dollars per share)					$ 1.28
Options outstanding, intrinsic value					$ 22
Compensation expense	$ 100	$ 200	$ 500	$ 700
Compensation cost, not yet recognized	$ 400		$ 400
Recognized over a period			2 years 9 months
The 2015 Incentive Stock Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Additional shareholders authorized (in shares)			1,000,000
Common stock, capital shares reserved for future issuance (in shares)	3,100,415		3,100,415
Number of shares available for grant (in shares)	1,160,695		1,160,695

Stock-Based Compensation - Sche

Stock-Based Compensation - Schedule of Non-vested Restricted Share Awards (Details) $ in Thousands	3 Months Ended
	Sep. 30, 2022 USD ($) shares
Shares
Non-vested, beginning balance (in shares) \| shares	531,787
Granted (in shares) \| shares	108,000
Vested (in shares) \| shares	(107,190)
Forfeited (in shares) \| shares	0
Non-vested, ending balance (in shares) \| shares	532,597
Fair Value
Non-vested, beginning balance \| $	$ 1,228
Granted \| $	146
Vested \| $	(269)
Forfeited \| $	0
Non-vested, ending balance \| $	$ 1,105

Segment Reporting (Details)

Segment Reporting (Details) $ in Thousands	3 Months Ended		9 Months Ended
Segment Reporting (Details) $ in Thousands	Sep. 30, 2022 USD ($) carrier	Sep. 30, 2021 USD ($)	Sep. 30, 2022 USD ($) carrier	Sep. 30, 2021 USD ($)	Dec. 31, 2021 USD ($)
Segment Reporting [Abstract]
Number of US wireless carriers \| carrier	4		4
Segment Reporting Information [Line Items]
Total sales	$ 25,926	$ 19,727	$ 77,474	$ 49,411
Total gross profit (loss)	8,543	5,048	22,448	12,498
Total income (loss) from operations	1,792	(2,235)	1,773	(7,383)
Segment assets	27,950		27,950		$ 25,426
Operating segments
Segment Reporting Information [Line Items]
Total sales	25,926	19,727	77,474	49,411
Total income (loss) from operations	1,792	(2,235)	1,773	(7,383)
Non-allocated
Segment Reporting Information [Line Items]
Segment assets	5,955		5,955		3,241
Wireless \| Continuing Operations
Segment Reporting Information [Line Items]
Segment assets	7,655		7,655		7,640
Wireless \| Operating segments
Segment Reporting Information [Line Items]
Total sales	7,898	6,992	22,908	15,462
Total gross profit (loss)	2,839	1,908	6,350	4,668
Total income (loss) from operations	(202)	(2,105)	(3,859)	(5,759)
Telco \| Continuing Operations
Segment Reporting Information [Line Items]
Segment assets	14,340		14,340		$ 14,545
Telco \| Operating segments
Segment Reporting Information [Line Items]
Total sales	18,028	12,735	54,566	33,949
Total gross profit (loss)	5,704	3,140	16,098	7,830
Total income (loss) from operations	$ 1,994	$ (130)	$ 5,632	$ (1,624)