SPRINGBIG HOLDIN(SBIG) - 2025 Q1 - Quarterly Report

Part I – Financial Information Financial Statements (Unaudited) SpringBig reported a net loss of $0.75 million for Q1 2025, a reversal from prior year, with revenues down 14% Condensed Consolidated Balance Sheets As of March 31, 2025, the company reported a total stockholders' deficit of $10.36 million and a working capital deficit of $2.0 million Condensed Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item | March 31, 2025 (unaudited) | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $1,087 | $1,179 | | Total current assets | $4,036 | $3,864 | | Total assets | $6,875 | $6,825 | | Total current liabilities | $6,057 | $5,670 | | Total liabilities | $17,234 | $16,596 | | Total stockholders' deficit | $(10,359) | $(9,771) | Condensed Consolidated Statements of Operations Net revenues decreased 14% to $5.52 million for Q1 2025, resulting in a net loss of $0.75 million Q1 2025 vs. Q1 2024 Statement of Operations (in thousands) | Metric | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Net revenues | $5,516 | $6,396 | | Gross profit | $4,310 | $4,680 | | Loss from operations | $(427) | $(282) | | Net (loss) income | $(751) | $417 | | Basic EPS | $(0.02) | $0.01 | | Diluted EPS | $(0.02) | $0.01 | Condensed Consolidated Statements of Cash Flows Net cash used in operating activities improved to $86,000 in Q1 2025, with overall cash decreasing by $92,000 Cash Flow Summary (in thousands) | Cash Flow Activity | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(86) | $(1,878) | | Net cash used in investing activities | $(6) | $(59) | | Net cash provided by financing activities | $0 | $3,274 | | Net (decrease) increase in cash | $(92) | $1,337 | Notes to the Condensed Consolidated Financial Statements Notes detail the company's single segment, liquidity, a $1.6 million PPP loan investigation, and the VICE CRM acquisition - The company has a history of losses, resulting in an accumulated deficit of $39.2 million as of March 31, 2025, though management projects sufficient liquidity for the next twelve months[30][32] - The company is under a civil investigative demand from the U.S. Attorney's Office regarding its eligibility for a $790,000 PPP loan received in 2020, creating a potential contingent loss of up to $1.6 million[90] - On March 17, 2025, the company announced its intent to acquire VICE CRM, an AI-enabled marketing platform, and appointed VICE CRM's founder, Jaret Christopher, as SpringBig's new CEO effective April 1, 2025[114] - In January 2024, the company issued $6.4 million in Secured Convertible Notes and $1.6 million in Secured Term Notes, with terms amended in November 2024[58][61] Management's Discussion and Analysis of Financial Condition and Results of Operations Management attributes the 14% revenue decline to market conditions, noting improved gross margin despite lower client numbers Key Operating and Financial Metrics | Metric | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Revenue (in thousands) | $5,516 | $6,396 | | Adjusted EBITDA (in thousands) | $326 | $150 | | Number of retail clients | 900 | 1,207 | | Net revenue retention | 86% | 89% | - Revenue decreased by $0.9 million (14%) year-over-year, with subscription revenue down 11% and excess use revenue down 40%, reflecting client budget-consciousness in the cannabis sector[146] - General and administrative expenses increased 36% year-over-year, primarily due to a $0.5 million expense related to the separation agreement with the former CEO[151] - The company's debt financing contains restrictive covenants that limit its ability to incur additional debt, pay dividends, sell assets, or issue additional equity, potentially constraining future capital-raising efforts[165] Quantitative and Qualitative Disclosure About Market Risk The company believes market risks from interest rates, inflation, and foreign currency exchange rates have not materially affected its business - The company does not believe that inflation has had a material effect on its business, financial condition, or results of operations[188] - Exchange rate risk from Canadian operations is considered immaterial as Canadian income and expenses are matched in the local currency[189] Controls and Procedures Management concluded that disclosure controls and procedures were not effective as of March 31, 2025 - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were not effective as of March 31, 2025[191] - No changes to internal control over financial reporting occurred in Q1 2025 that materially affected, or are reasonably likely to materially affect, the company's internal controls[192] Part II – Other Information Legal Proceedings The company is involved in a civil investigative demand regarding its PPP Loan eligibility, as detailed in Note 15 - The company is involved in a legal matter concerning a civil investigative demand regarding its Paycheck Protection Program (PPP) Loan. See Note 15 for details[194][90] Risk Factors No material changes to risk factors were reported from the Annual Report on Form 10-K for the year ended December 31, 2024 - The company directs investors to the Risk Factors section of its Annual Report on Form 10-K for the year ended December 31, 2024, indicating no new material risks are being reported in this 10-Q[195] Unregistered Sales of Equity Securities and Use of Proceeds The company reported no unregistered sales of equity securities during the period - None[196]