Revenue Performance - Revenue for the three months ended June 30, 2023, was $721,488, a decrease of approximately $1,089,666 or 60% compared to $1,811,154 in the same period of the prior year[101] - Revenue for the six months ended June 30, 2023, was $1,533,199, a decrease of approximately $1,037,735 or 40% compared to $2,570,934 in the same period of the prior year[112] - The company expects an improvement in revenues in fiscal 2023 as the COVID-19 pandemic appears to be abating[92] Cost of Revenues - The cost of revenues decreased to $101,389 during the three months ended June 30, 2023, compared to $497,733 during the same period in 2022, with cost of revenues as a percentage of revenue at 14% in 2023 versus 27% in 2022[104] - Cost of revenues decreased to $196,266 during the six months ended June 30, 2023, compared to $598,298 during the same period in 2022, with cost of revenues as a percentage of revenue decreasing from 23% to 13%[115] Expenses - Selling, general and administrative expenses were $2,453,615 during the three months ended June 30, 2023, an increase of $978,161 from $1,475,455 in the same period of 2022[106] - Selling, general and administrative expenses increased to $3,569,634 during the six months ended June 30, 2023, compared to $2,912,050 in the same period of 2022, an increase of $657,584[117] Losses - The company incurred a loss from operations of $1,833,516 for the three months ended June 30, 2023, compared to a loss of $193,078 for the same period in 2022[108] - The company incurred a loss from operations of $2,232,701 for the six months ended June 30, 2023, compared to a loss of $988,938 for the same period in 2022[119] - The net loss for the three months ended June 30, 2023, was $1,840,686, compared to a net loss of $193,590 for the same period in 2022[110] - The net loss for the six months ended June 30, 2023, was $2,265,602, compared to a net income of $78,491 for the same period in 2022[121] Cash Position - The company had cash of $2,134,182 available to fund operations and expansion plans as of June 30, 2023[94] - Cash used in operating activities for the six months ended June 30, 2023, was approximately $981,092, compared to $35,910 in the same period of 2022[128] - Cash provided by financing activities for the six months ended June 30, 2023, was $1,992,316, compared to $250,000 in the same period of 2022[131] - As of June 30, 2023, the company had cash on hand amounting to $2,134,182[124] Financial Health - The company recorded a stockholders' deficit of $273,935 at June 30, 2023, raising substantial doubt about its ability to continue as a going concern[122] - The loans have an interest rate of 3.75% per annum, with a combined repayment of principal and interest of $3,500 per month over 30 years[138] - As of June 30, 2023, the note payable had a principal balance of $661,035 and accrued interest payable of $38,098[138] - As of December 31, 2022, the accrued interest payable was $45,541, indicating a decrease in interest payable over the period[138] Accounting Policies and Estimates - The company has not made any changes to its critical accounting policies that would impact the condensed consolidated financial statements[140] - Significant estimates include those related to uncollectible accounts, depreciable lives of property and equipment, and impairments of long-term assets[140] - The company is not required to provide quantitative and qualitative disclosures about market risk as a smaller reporting company[142] Digital Engagement - The average number of unique visitors to the company's digital platforms was 700,000 per month during the year ended December 31, 2022[90] - Mobile revenue has grown to 49% of B2C revenue, with over 6.4 million downloads of the company's apps for the year ended December 31, 2022[90] - The B2B sales program comprises 50% of revenue, indicating significant growth since its introduction in 2004[91] Investing Activities - The company had no investing activities for the six months ended June 30, 2023, while cash provided by investing activities for the same period in 2022 was $12,805[130] - There were no off-balance sheet arrangements reported by the company[139]
RDE Inc(RSTN) - 2023 Q2 - Quarterly Report