Revenue Performance - For the three months ended March 31, 2025, total revenues decreased by 11% to $429,340 compared to $481,094 in the same period of 2024[123] - Service revenues increased by 77% to $77,356, driven by a higher volume of marketing services provided[125] - Product revenues decreased by 20% to $351,984, primarily due to lower sales volume on the CWS Platform[126] Profitability and Loss - Gross profit for the three months ended March 31, 2025, was $30,158, a significant improvement from a gross loss of $79,497 in the same period of 2024[129] - Net loss for the three months ended March 31, 2025, was $2,389,650, a slight improvement from a net loss of $2,427,392 in the same period of 2024[132] - The net loss for the three months ended March 31, 2025, was $2,389,650, partially offset by non-cash charges of $868,189 and changes in operating assets and liabilities of $5,097,912[139] Cash Flow and Liquidity - As of March 31, 2025, cash and cash equivalents were $7,889,597, an increase from $5,386,789 as of December 31, 2024[133] - The Company reported a net cash used in operating activities of $6,619,373 for the three months ended March 31, 2025, compared to $1,374,040 for the same period in 2024[138] - The Company had net cash provided by financing activities of $9,122,181 for the three months ended March 31, 2025, compared to a net cash used of $547,515 in 2024[141] - The Company reported a net change in cash and cash equivalents of $2,502,808 for the three months ended March 31, 2025, compared to a decrease of $5,282,441 in 2024[138] Expenses - General and administrative expenses increased by 26% to $2,023,161, largely due to higher professional fees and personnel-related costs[130] - Sales and marketing expenses decreased by 48% to $406,853, attributed to the absence of website development costs incurred in the prior year[131] Funding and Financial Commitments - The company raised a total of $9,230,236 in net proceeds through the issuance of common stock during the three months ended March 31, 2025[134] - The Company entered into a Funding Commitment Agreement on November 1, 2023, committing to provide a minimum annual funding of $2,500,000 to the Product Handler for inventory purchases[142] Going Concern and Operational Challenges - The company has not generated profits since inception and has negative cash flows from operations of $6,619,374 for the three months ended March 31, 2025, raising doubts about its ability to continue as a going concern[135] - The Company has not been able to generate sufficient cash flows from operations to meet its obligations, raising concerns about its ability to continue as a going concern[137] - The Company is exploring various strategies, including customer acquisition and new partnerships, to increase volume and improve gross margins[136] Investments and Accounting Policies - The Company invested $4,030,986 in mutual fund investments in 2024 and received $670,000 back from an investment it was no longer pursuing[140] - There have been no material changes in the Company's critical accounting policies from those disclosed in the Annual Report for the fiscal year ended December 31, 2024[146] - There were no off-balance sheet arrangements that could affect the Company's financial condition[144]
LQR House (LQR) - 2025 Q1 - Quarterly Report