WASHINGTON, DC 20549 UNITED STATES SECURITIES AND EXCHANGE COMMISSION FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____ to ______ Commission File Number: 001-39775 ContextLogic Inc. (Exact Name of Registrant as Specified in its Charter) Delaware 27-2930953 (State or other ju ...

Company Outlook The first quarter of 2025 marked a pivotal step in the Company's evolution with the completion of the previously announced strategic investment from BC Partners (the "Strategic Investment") in a subsidiary of ContextLogic, which was an important milestone in advancing our value-maximization strategy through both organic growth and value-enhancing acquisitions. Following the Strategic Investment, ContextLogic made several important changes to its board of directors. In addition to naming Ted ...

OAKLAND, Calif., May 09, 2025 (GLOBE NEWSWIRE) -- ContextLogic Inc. (Nasdaq: LOGC) (“ContextLogic,” the “Company,” “we” or “our”) today reported its financial results for the quarter ended March 31, 2025. First-Quarter 2025 Financial Highlights Net Loss: Net loss was $4 million, compared to a net loss of $59 million in the first quarter of fiscal year 2024.As of March 31, 2025, the Company had $64 million in cash and cash equivalents, $158 million in marketable securities and $1 million in prepaid expenses ...

Core Viewpoint - ContextLogic Inc. (WISH) announced a strategic investment from BC Partners during its Q4 2024 earnings conference call, indicating a significant development for the company [1]. Group 1: Company Overview - The conference call was led by Chairman Ted Goldthorpe and CEO Rishi Bajaj, highlighting the importance of the strategic investment [1]. - A slide deck was referenced during the call, which is available on ContextLogic's Investor Relations website, providing additional context and information [2]. Group 2: Forward-Looking Statements - The call included forward-looking statements that may involve risks and uncertainties, which could lead to actual results differing from those anticipated [3]. - The company emphasized that all statements made, other than historical facts, are considered forward-looking and are subject to change based on various factors [4].

Financial Performance - Total revenue for the year ended December 31, 2024, was $43 million, a decrease of $244 million or 85% compared to $287 million in 2023[159] - Loss from operations for 2024 was $79 million, compared to a loss of $328 million in 2023[156] - The company incurred total operating expenses of $86 million in 2024, down from $387 million in 2023, reflecting a decrease of $301 million or 78%[156] - The accumulated deficit as of December 31, 2024, was $3.3 billion, with expectations of continued losses from operations due to acquisition-related costs[134] - Interest and other income, net decreased by $10 million, or 63%, to $6 million for the year ended December 31, 2024, compared to $16 million in 2023, with a percentage of revenue increasing from 6% to 14%[165] - Provision for income taxes increased by $1 million, or 20%, to $6 million for the year ended December 31, 2024, compared to $5 million in 2023, with a percentage of revenue rising from 2% to 14%[167] Cost Management - Sales and marketing expenses decreased by $125 million or 87% to $18 million in 2024, compared to $143 million in 2023[161] - Cost of revenue decreased by $192 million or 84% to $36 million in 2024, compared to $228 million in 2023[160] - Product development expenses decreased by $126 million, or 83%, to $26 million for the year ended December 31, 2024, compared to $152 million in 2023, representing 60% of revenue in 2024 versus 53% in 2023[162][163] - General and administrative expenses decreased by $50 million, or 54%, to $42 million for the year ended December 31, 2024, compared to $92 million in 2023, accounting for 98% of revenue in 2024 versus 32% in 2023[164] Asset Management - The company completed an Asset Sale to Qoo10 on April 19, 2024, selling substantially all assets except for certain tax attributes and cash equivalents[139] - Gain on Asset Sale increased by $4 million, or 100%, to $4 million for the year ended December 31, 2024, due to the completion of the Asset Sale on April 19, 2024[166] - Following the Asset Sale, the company no longer has revenue or deferred revenue, as it has no marketplace and logistics operations[183][184] Cash Flow - As of December 31, 2024, the company had cash and cash equivalents of $66 million and marketable securities of $83 million, which are expected to meet anticipated cash needs for at least the next 12 months[169] - Net operating cash outflows were $94 million for the year ended December 31, 2024, significantly improved from $341 million in 2023, primarily driven by a net loss of $75 million[170][175] - Net cash used in investing activities was $68 million for the year ended December 31, 2024, primarily due to $168 million in purchases of marketable securities[177] - Net cash used in financing activities was $1 million for the year ended December 31, 2024, compared to $5 million in 2023, both related to tax payments for employee stock settlements[179] Workforce and Operational Changes - Workforce reductions in 2023 involved approximately 400 employees, representing about 50% of the global workforce, incurring charges of approximately $13 million[136] - The company expects to incur minimal administrative costs post-Asset Sale while overseeing remaining assets[142] Market Conditions - The company is monitoring global financial market volatility, including inflation and rising interest rates, which may adversely affect business operations[135] Valuation and Taxation - The company utilizes the Black-Scholes option pricing model and Monte Carlo Simulation model to estimate the fair value of stock options and performance stock units (PSUs) respectively[196] - The assumptions used in the valuation models involve significant judgment and can lead to materially different stock-based compensation expenses if factors change[197] - The company is subject to income taxes in the U.S. and various international jurisdictions, requiring significant estimation and judgment[198] - Deferred tax liabilities and assets are recognized for expected future tax consequences of temporary differences and net operating loss carryforwards[199]

Financial Performance - Net loss for Q4 2024 was $2 million, a significant improvement compared to a net loss of $68 million in Q4 2023, representing a reduction of approximately 97%[9] - The company reported no revenue for Q4 2024, compared to $53 million in Q4 2023, indicating a complete shift in business operations following the sale of the Wish platform[14] - Net loss for the three months ended December 31, 2024, was $2 million, compared to a net loss of $68 million for the same period in 2023[16] Cash and Liquidity - As of December 31, 2024, the company had $66 million in cash and cash equivalents and $83 million in marketable securities, totaling $149 million in liquid assets[12] - The company has approximately $225 million in liquidity available for investment, including a recent $75 million investment from BC Partners[2] - Total cash, cash equivalents, and restricted cash at the end of the period was $73 million, down from $238 million at the end of the previous year[16] - The company reported a decrease in cash equivalents and restricted cash by $165 million for the year ended December 31, 2024[16] Operating Expenses - The company incurred $4 million in general and administrative expenses during Q4 2024, primarily due to legal and employee expenses[5] - Operating expenses for Q4 2024 were $81 million, down from $86 million in Q4 2023, reflecting a reduction of approximately 6%[14] - Cash used in operating activities for the year ended December 31, 2024, was $94 million, a decrease from $341 million in 2023[16] Investments and Securities - Interest income for Q4 2024 was $2 million, with investments primarily in U.S. government instruments[6] - Purchases of marketable securities for the year ended December 31, 2024, totaled $168 million, compared to $313 million in 2023[16] - Maturities of marketable securities for the year ended December 31, 2024, were $228 million, compared to $390 million in 2023[16] - Cash disposed on asset sale, net of proceeds, was $133 million for the year ended December 31, 2024[16] Financial Position - ContextLogic had total liabilities of $5 million as of December 31, 2024, a decrease from $206 million in 2023, indicating a significant reduction in financial obligations[12] - Total current assets decreased from $410 million in 2023 to $156 million in 2024, a decline of approximately 62%[12] Strategic Outlook - The company is focusing on strategic opportunities for growth through potential acquisitions and investments, as stated in its outlook[4]

Asset Sale - On April 19, 2024, ContextLogic Inc. completed the Asset Sale to Qoo10, selling substantially all of its assets, including the Wish platform, while retaining net operating losses and certain cash equivalents[22]. - Following the Asset Sale, the company no longer has revenues from marketplace and logistics operations[42]. - The Company completed an asset sale on April 19, 2024, resulting in total proceeds of $214 million[48]. - Following the asset sale, accrued liabilities decreased by 100% to $4 million, down from $90 million as of December 31, 2023[51][52]. - The Company terminated its Revolving Credit Agreement, which previously allowed borrowing up to $280 million, on April 19, 2024[50]. - Following the asset sale, the company received $162 million in cash from Qoo10, which included certain purchase price adjustments[113]. - The company's long-lived tangible assets were previously located 56% in the U.S. and 44% in China, but it no longer owns such assets post-asset sale[80]. Financial Performance - The Company generated marketplace revenue of $24 million and logistics revenue of $36 million for 2023, totaling $60 million in revenue[41]. - The provision for income taxes was $0 million for the three months ended September 30, 2024, compared to $3 million for the same period in 2023, primarily due to withholding taxes on intercompany dividends[75]. - The Company reported a net loss of $1 million for the three months ended September 30, 2024, compared to a net loss of $80 million for the same period in 2023[77]. - China accounted for nearly all marketplace and logistics revenue for the nine months ended September 30, 2024, with U.S. revenue being immaterial[80]. Cash and Assets - As of September 30, 2024, the Company reported total financial assets of $148 million, including $31 million in cash equivalents and $117 million in marketable securities[43][46]. - The Company’s marketable securities as of September 30, 2024, had an amortized cost of $117 million, with an estimated fair value of $117 million[47]. - As of September 30, 2024, the company had 556 total stock options and restricted stock units outstanding, a decrease from 3,125 in the previous year[78]. Stock and Compensation - The total stock-based compensation expense for the nine months ended September 30, 2024, was $12 million, a decrease from $54 million for the same period in 2023[74]. - Following the Asset Sale, all outstanding equity awards became fully vested, impacting the stock-based compensation expense[73]. - The Company’s CEO, Jun Yan, received RSUs and options with a total grant date fair value of $6 million, which became fully vested upon the Asset Sale[69]. Internal Controls and Governance - The company identified material weaknesses in internal controls over financial reporting, which have not resulted in material misstatements but could lead to potential issues[112]. - Management is redesigning a new control environment and IT systems following the asset sale to align with the company's current operations[113]. - There were no significant changes in internal controls over financial reporting during the third quarter of 2024 that materially affected the company's reporting[114]. - The company does not expect its disclosure controls and procedures to prevent all errors and fraud due to inherent limitations[115]. Workforce and Costs - The company announced workforce reductions of up to 150 and 255 employees in January and August 2023, respectively, totaling approximately 17% and 34% of the global workforce[82]. - The company incurred approximately $13 million in severance and personnel reduction costs related to the workforce reductions[82]. Accounting Policies and Standards - There have been no changes to the company's significant accounting policies that have had a material impact on its condensed consolidated financial statements[36]. - The Company expects the adoption of new accounting standards to have no material impact on its financial statements[37][38]. - The Company did not identify any available-for-sale marketable securities requiring an allowance for credit loss or impairment during the periods presented[47]. Operational Aspects - The company operates as a single operating segment, with its Chief Executive Officer making all operating decisions based on consolidated financial information[32]. - The company has not experienced any significant service interruptions during the three and nine months ended September 30, 2024, and 2023[35]. - The Asset Sale did not result in the company's operations meeting the criteria for discontinued operations, as the disposed operations were not clearly distinguishable from the rest of the company[30]. - The Company’s financial instruments include cash equivalents, marketable securities, and derivative instruments, with fair value measurements categorized based on the level of judgment associated with inputs[43][46].

Financial Performance - Net loss for Q3 2024 was $1 million, a significant improvement from a net loss of $80 million in Q3 2023[1] - Net loss for Q3 2024 was $73 million, a significant improvement from a net loss of $249 million in Q3 2023[12] - Net cash used in operating activities decreased to $92 million from $266 million year-over-year[12] - Cash flows from investing activities resulted in a net cash outflow of $103 million, compared to a net inflow of $75 million in the previous year[12] - The company reported a depreciation and amortization expense of $1 million for Q3 2024, down from $3 million in Q3 2023[12] - Stock-based compensation for the quarter was $12 million, a decrease from $54 million in the same quarter last year[12] - Proceeds from asset sales amounted to $133 million, with no comparable figure reported in Q3 2023[12] - The company experienced a foreign currency effect on cash of $2 million, compared to $7 million in the previous year[12] - Cash paid for income taxes was negligible in Q3 2024, compared to $1 million in Q3 2023[12] Cash and Assets - As of September 30, 2024, the company had $33 million in cash and cash equivalents and $117 million in marketable securities[2] - Total cash, cash equivalents, and restricted cash at the end of the period was $40 million, down from $310 million at the end of Q3 2023[12] - Total current assets decreased from $410 million in 2023 to $158 million in 2024[10] - The company had $33 million in cash and cash equivalents at the end of the period, down from $303 million a year ago[12] Liabilities and Expenses - Total liabilities as of September 30, 2024, were $5 million, with expectations to remain low until future targets are identified[7] - The company incurred $3 million in general and administrative expenses during Q3 2024, primarily due to legal and employee expenses[4] Strategic Focus - The company is focused on identifying and evaluating strategic opportunities to enhance stockholder value[3] - The company aims to provide stakeholders with a more substantive update on strategic opportunities in the coming quarters[8] Employment - The company had eight full-time employees at the end of Q3 2024[4] Tax Assets - The company reported a deferred tax asset of $609 million as of December 31, 2023, subject to a full valuation allowance[6] Interest Income - Interest income for Q3 2024 was $2 million, with an expectation to earn approximately $2 million in Q4 2024[5]

Financial Performance - The company reported a net loss of $1 million for Q3 2024, a significant improvement compared to a net loss of $80 million in Q3 2023 [2] - As of September 30, 2024, the company had $33 million in cash and cash equivalents, $117 million in marketable securities, and $8 million in prepaid expenses and other current assets [2] - The company incurred $3 million in general and administrative expenses during Q3 2024, primarily related to legal and employee expenses [4] Company Outlook - The company has streamlined its administrative structure to focus on strategic goals, including acquiring or building operating businesses [3] - Management is actively identifying and evaluating strategic opportunities to benefit the company and its stockholders [3][8] - The company expects to earn approximately $2 million in interest income in Q4 2024, projecting a total of around $155 million in cash, cash equivalents, marketable securities, and restricted cash by the end of fiscal 2024 [5] Balance Sheet and Assets - As of September 30, 2024, total liabilities were reported at $5 million, with expectations to remain low until future targets are identified [7] - The company has deferred tax assets, including net operating losses of $609 million, but these are subject to a full valuation allowance [6] - The total current assets as of September 30, 2024, amounted to $158 million, down from $410 million as of December 31, 2023 [11]

Financial Performance - The company reported revenue of $7 million for the three months ended June 30, 2024, a decrease of 91% compared to $78 million for the same period in 2023[14]. - Gross profit for the same period was $1 million, down from $16 million year-over-year, indicating a significant decline in profitability[14]. - The net loss for the three months ended June 30, 2024, was $13 million, compared to a net loss of $80 million for the same period in 2023[14]. - The company reported a net loss of $72 million for the three months ended June 30, 2024, compared to a net loss of $169 million for the same period in 2023[25]. - The company incurred stock-based compensation expenses of $12 million for the three months ended June 30, 2024, down from $41 million in the same period of 2023[25]. - The total stock-based compensation expense for the three months ended June 30, 2024, was $3 million, compared to $15 million for the same period in 2023[97]. - The provision for income taxes was $0 million for the three months ended June 30, 2024, compared to $3 million for the same period in 2023[99]. Operating Expenses and Liabilities - Operating expenses totaled $20 million for the three months ended June 30, 2024, compared to $99 million in the prior year, reflecting an 80% reduction[14]. - Total current liabilities were reported at $5 million, significantly reduced from $196 million as of December 31, 2023[13]. - Total accrued liabilities decreased by 94% to $5 million as of June 30, 2024, primarily due to the Asset Sale on April 19, 2024[71]. - Other accrued liabilities decreased by 83% to $5 million, with $3 million related to payables to Qoo10 for restricted cash[71]. Cash and Cash Equivalents - Cash and cash equivalents decreased to $103 million as of June 30, 2024, down from $238 million at the end of 2023[13]. - Cash, cash equivalents, and restricted cash decreased to $110 million as of June 30, 2024, down from $325 million at the end of the previous year[25]. - As of June 30, 2024, total cash equivalents were $100 million, including $97 million in money market funds and $3 million in U.S. Treasury bills[61]. - Total marketable securities as of June 30, 2024, were $47 million, all in U.S. Treasury bills[62]. Asset Sale and Financial Impact - The company completed an asset sale, resulting in a gain of $4 million recognized in the financial statements[14]. - The company completed an asset sale on April 19, 2024, receiving $162 million in cash and marketable securities post-closing[28]. - The company recognized a gain of $4 million on the asset sale after accounting for net proceeds of $45 million and net assets sold of $41 million[69]. - Following the asset sale, the company no longer has marketplace and logistics operations, resulting in zero revenues[59]. - The Asset Sale to Qoo10 was approved by stockholders on April 18, 2024, and met the criteria for being classified as held for sale[42]. Tax Benefits and Legal Matters - The company has entered into a Tax Benefits Preservation Plan to protect its net operating losses, which were retained post-asset sale[33]. - The Company adopted a Tax Benefits Preservation Plan to protect its ability to utilize Net Operating Losses (NOLs) and other tax attributes, which are valuable assets[35]. - The Rights under the Tax Benefits Preservation Plan become exercisable upon the "Distribution Time," which occurs 10 days after a person or group becomes an "Acquiring Person" owning 4.9% or more of the Company's stock[36]. - The Rights will expire on February 10, 2027, or upon certain conditions such as redemption or merger approval by the Board of Directors[37]. - Legal contingencies include ongoing class action lawsuits, with no estimated range of potential losses available at this time[88][89]. - The Company believes there are no other legal contingency matters that would materially affect its financial position as of June 30, 2024[90]. Stock and Employee Matters - The company executed a 1-for-30 reverse stock split effective April 11, 2023, which did not change the number of authorized shares[31]. - As of June 30, 2024, the company had 366 thousand options outstanding with a weighted average exercise price of $18.00 and 200 thousand RSUs remaining[9]. - The company incurred approximately $13 million in severance and personnel reduction costs related to workforce reductions in January and August 2023, affecting about 405 employees[105]. - Following the Asset Sale, the company terminated its Employee Stock Purchase Plan[98]. Control Environment and IT Infrastructure - A new control environment has been developed with new systems, processes, and controls to support ongoing business operations following the asset sale[144]. - The implementation of a new IT infrastructure includes a General Ledger and Human Resources/Payroll system to enhance internal controls over financial reporting[144]. - Management acknowledges inherent limitations in disclosure controls and procedures, indicating that not all errors and fraud can be prevented[145]. - The design of the control system is subject to resource constraints and may not provide absolute assurance against misstatements due to error or fraud[145].