SPRINGBIG HOLDIN(SBIG) - 2024 Q3 - Quarterly Results

Financial and Operational Highlights Third Quarter 2024 Financial Highlights In Q3 2024, Springbig reported $6.4 million revenue, achieved positive Adjusted EBITDA of $0.4 million, and significantly narrowed its net loss to $(0.6) million, driven by a 44% reduction in operating expenses Q3 2024 Financial Performance vs. Q3 2023 (in millions, except per share data) | Metric | Q3 2024 | Q3 2023 | | :--- | :--- | :--- | | Revenue | $6.4 | $6.9 | | Subscription Revenue | $5.2 | $5.4 | | Gross Profit | $4.4 | $5.3 | | Operating Expenses | $4.5 | $8.0 | | Net Loss | $(0.6) | $(2.7) | | Adjusted EBITDA* | $0.4 | $(0.9) | | Basic Net Loss Per Share | $(0.01) | $(0.07) | - Operating expenses were reduced by 44% year-on-year to $4.5 million, which also represents a 6% sequential reduction from the second quarter[6] Nine Month 2024 Financial Highlights For the first nine months of 2024, revenue was $19.5 million, with a significant profitability turnaround to positive Adjusted EBITDA of $0.9 million, a $4.3 million improvement driven by a 38% reduction in operating expenses - The company achieved positive Adjusted EBITDA for the third consecutive quarter, reaching $0.9 million year-to-date, a $4.3 million improvement year-on-year[5][2] Nine Months 2024 Financial Performance vs. 2023 (in millions) | Metric | Nine Months 2024 | Nine Months 2023 | | :--- | :--- | :--- | | Revenue | $19.5 | $21.3 | | Subscription Revenue | $16.1 | $16.6 | | Gross Profit | $13.8 | $16.8 | | Operating Expenses | $14.2 | $23.0 | | Net Loss | $(0.8) | $(7.0) | | Adjusted EBITDA* | $0.9 | $(3.4) | - Year-to-date operating expenses were reduced by 38% or $8.8 million year-on-year[5][10] Debt Restructuring Amendment to Debt Obligations Springbig extended the maturity of its $6.4 million Convertible Notes and $1.6 million Term Loan to January 2027, with amended interest rates of 13% and 17% respectively, including a rate reduction mechanism tied to Adjusted EBITDA targets, and anticipates strong free cash flow in 2025 - The maturity of the $6.4 million Secured Convertible Notes and $1.6 million Secured Term Loan has been extended by twelve months to January 2027[8][5] - The interest rates were amended to 13% for the Convertible Notes and 17% for the Term Loan[8] - A rate reduction mechanism is in place: for each quarter the company reports an Adjusted EBITDA of at least $0.9 million, the interest rate on both debts will be reduced by 0.75%, up to a maximum of 3.0%[8] - The company is now in compliance with all terms of its debt obligations and anticipates generating strong free cash flow in 2025[9] Financial Outlook Fourth Quarter 2024 Guidance For the fourth quarter of 2024, Springbig projects revenue to be between $6.5 million and $6.8 million and expects to continue its trend of profitability with an Adjusted EBITDA in the range of $0.8 million to $1.0 million Q4 2024 Outlook | Metric | Expected Range (in millions) | | :--- | :--- | | Revenue | $6.5 - $6.8 | | Adjusted EBITDA* | $0.8 - $1.0 | Consolidated Financial Statements Condensed Consolidated Balance Sheets As of September 30, 2024, the company reported total assets of $7.5 million, total liabilities of $16.3 million, and a total stockholders' deficit of $(8.8) million, with cash increasing to $0.85 million and current liabilities at $13.7 million Balance Sheet Summary (in thousands) | Account | September 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $847 | $331 | | Total current assets | $4,424 | $4,445 | | Total assets | $7,482 | $5,105 | | Total current liabilities | $13,700 | $13,551 | | Total liabilities | $16,325 | $13,779 | | Total stockholders' deficit | $(8,843) | $(8,674) | Condensed Consolidated Statement of Operations The company's net loss significantly narrowed to $(0.6) million for Q3 2024 and $(0.8) million for the nine-month period, a substantial improvement from prior years driven by reduced operating expenses and a $1.6 million gain on note repurchase Statement of Operations Summary (in thousands) | Metric | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :--- | :--- | :--- | :--- | :--- | | Revenues | $6,425 | $6,888 | $19,511 | $21,259 | | Gross Profit | $4,435 | $5,284 | $13,812 | $16,794 | | Total operating expenses | $4,480 | $7,976 | $14,196 | $22,987 | | Loss from operations | $(45) | $(2,692) | $(384) | $(6,193) | | Net loss | $(554) | $(2,742) | $(784) | $(7,032) | Condensed Consolidated Statement of Cash Flows For the nine months ended September 30, 2024, net cash used in operating activities improved to $(1.3) million, with $1.9 million provided by financing activities, resulting in a net cash increase of $0.5 million and an ending cash balance of $0.85 million Cash Flow Summary for Nine Months Ended Sep 30 (in thousands) | Cash Flow Activity | 2024 | 2023 | | :--- | :--- | :--- | | Net cash used in operating activities | $(1,334) | $(3,468) | | Net cash used in investing activities | $(64) | $(259) | | Net cash provided by financing activities | $1,914 | $474 | | Net increase/(decrease) in cash | $516 | $(3,253) | | Cash and cash equivalents, end of period | $847 | $293 | Non-GAAP Financial Measures Explanation of Non-GAAP Measures The company uses non-GAAP measures like EBITDA and Adjusted EBITDA to supplement GAAP results, believing they are key for evaluating operating performance, planning, and strategic decisions, providing useful and comparable investor information - The company discloses EBITDA and Adjusted EBITDA, which are non-GAAP measures, to provide investors with additional information regarding financial results[14] - Management uses these metrics to evaluate operating performance, generate future operating plans, and make strategic decisions, believing they provide improved comparability between fiscal periods[15] Reconciliation of Net Loss to Non-GAAP EBITDA and Adjusted EBITDA For Q3 2024, a net loss of $(0.6) million was reconciled to an Adjusted EBITDA of $0.4 million, and for the nine-month period, a net loss of $(0.8) million was reconciled to an Adjusted EBITDA of $0.9 million, with key adjustments including interest expense, stock-based compensation, and gains on debt repurchase Reconciliation of Net Loss to Adjusted EBITDA (in thousands) | Metric | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :--- | :--- | :--- | :--- | :--- | | Net loss | $(554) | $(2,742) | $(784) | $(7,032) | | EBITDA | $38 | $(2,277) | $1,322 | $(5,736) | | Adjusted EBITDA | $409 | $(882) | $889 | $(3,370) |