Fresh Vine Wine(VINE) - 2024 Q3 - Quarterly Report

Financial Performance - Fresh Vine Wine reported net revenue of $63,209 for the three months ended September 30, 2024, a decrease of 92.6% compared to $847,959 for the same period in 2023[139]. - The gross profit for the three months ended September 30, 2024, was $152,646, compared to a gross loss of $(41,885) for the same period in 2023[139]. - The net loss for the three months ended September 30, 2024, was $(315,290), a significant improvement from a net loss of $(2,129,660) for the same period in 2023[139]. - Net revenue for the three months ended September 30, 2024, was $63,209, a decrease of 93% compared to $847,959 for the same period in 2023[161]. - Gross loss for the three months ended September 30, 2024, was $152,646, a significant improvement of 464% compared to a gross loss of $(41,885) in the same period of 2023[161]. - Selling, general and administrative expenses decreased by 60% to $459,988 for the three months ended September 30, 2024, compared to $1,141,390 in the same period of 2023[163]. - Cash used in operating activities decreased to $(1,346,789) for the nine months ended September 30, 2024, from $(4,585,403) in the same period of 2023[164]. - As of September 30, 2024, the company had an accumulated deficit of approximately $29.0 million and a total stockholders' deficit of approximately $2.4 million[169]. - Current assets amounted to approximately $482,000, while current liabilities were approximately $3.4 million, resulting in a working capital deficit of approximately $2.9 million[170]. - The company expects to incur losses in future periods as it continues to operate and incur expenses associated with being a public company[169]. Sales and Marketing - Direct-to-consumer (DTC) sales accounted for 87.7% of total revenue for the three months ended September 30, 2024, compared to 12.2% for the same period in 2023[154]. - Fresh Vine Wine's marketing strategy targets consumers aged 21 to 34 with moderate to affluent income, focusing on a healthy and active lifestyle[132]. - The company anticipates net revenue to peak during the quarter spanning from October through December due to increased consumer demand around major holidays[144]. Business Strategy and Operations - Fresh Vine Wine is licensed to sell through direct-to-consumer channels in 43 states and has active relationships with wholesale distributors in all 50 states[130]. - The company is working with leading distributors to expand its presence across the contiguous United States, including Southern Glazer's Wine & Spirits and Republic National Distributing Company[130]. - Fresh Vine Wine's asset-light operating model helps mitigate risks associated with agribusiness, such as droughts or fires, by sourcing inputs from multiple vendors[133]. - The company has been actively seeking new sources of capital and entered into purchase orders with Grocery Outlet to improve liquidity[172]. - The company projects that its existing cash balance will be sufficient to fund current operations through the first quarter of 2025, but requires additional financing to sustain operations[177]. Mergers and Acquisitions - Fresh Vine is exploring strategic opportunities through merger, acquisition, or other transactions to enhance stockholder value[180]. - The company entered into a Merger Agreement with Notes Live, which was later terminated on July 31, 2024[181]. - A new Business Combination Agreement was established on November 3, 2024, involving multiple subsidiaries and aiming for NYSE American listing[183]. - The Business Combination is contingent upon raising up to $10,000,000 through equity or debt securities to cover transaction expenses[184]. - If the Business Combination does not close, the company may consider suspending operations or liquidating assets, potentially leading to significant losses for stockholders[185]. - The company has funded operations through debt and equity financing as detailed in its Annual Report for the year ended December 31, 2023[186]. - Fresh Vine is classified as an emerging growth company, allowing it to utilize reduced reporting requirements and an extended transition period for new accounting standards[190].