Company Overview - Cineverse has over 71,000 film and TV assets and has reached over 82 million streaming viewers, with more than 1.4 million SVOD subscribers[18]. - The company aims to grow its viewership significantly beyond the current base of 82 million monthly viewers to potentially hundreds of millions across billions of connected devices[20]. - Cineverse has transformed from a digital cinema equipment distributor to a leading independent streaming company[210]. - The company played a pioneering role in transitioning movie screens from traditional analog film prints to digital distribution[210]. Technology and Operations - Cineverse's proprietary technology platform, Matchpoint™, enables the company to automate content distribution and features a robust data analytics platform[16]. - The company operates a proprietary technology platform, Matchpoint™, which supports various streaming capabilities and data analytics[113]. - The company collaborates with major brands and content creators, distributing products through platforms like Netflix, Hulu, and Amazon Prime[17]. - Cineverse's strategic partnerships with connected streaming TV companies aim to expand its device and platform reach[20]. - The company has established a comprehensive cybersecurity program integrated into its risk management and internal control systems[91]. Financial Performance - For the fiscal year ended March 31, 2025, total revenue increased by $29.1 million to $78.2 million, with streaming and digital revenue growing by 19% to $44.4 million[145]. - For the fiscal year ended March 31, 2025, the company reported a net income attributable to common stockholders of $3.2 million, while maintaining an accumulated deficit of $500.9 million[115]. - The company generated $17.4 million of net positive cash flows from operations for the year ended March 31, 2025, with cash and cash equivalents of $13.9 million and total equity of $37.8 million[47]. - The company reported a net cash provided by operating activities of $17,411,000, compared to a cash used of $10,592,000 in 2024[201]. - The company achieved a net income attributable to common shareholders of $3.2 million for the year ended March 31, 2025[211]. Challenges and Risks - Cineverse recorded a goodwill impairment charge of $14 million in the prior fiscal year, indicating potential future risks related to asset valuation[33]. - Future operations may be impacted by the inability to generate sufficient cash flow, which is subject to various uncontrollable factors[44]. - The commercial success of media content is unpredictable, and the company faces risks related to audience reactions and competition[52]. - Changes in economic conditions could adversely affect demand for the company's products and services, impacting financial performance[56]. - The company is vulnerable to cybersecurity risks, which could lead to service disruptions and negatively impact user experience[59]. - The company's reliance on Amazon Web Services (AWS) for computing infrastructure poses a risk, as any disruption could adversely affect operations[64]. Capital Structure and Funding - The company has incurred long-term losses and primarily financed operations through equity investments and borrowings, indicating a reliance on external funding[47]. - The company may need to adopt alternative strategies, including reducing capital expenditures and seeking additional funding, if unable to service its indebtedness[50]. - The company has a Line of Credit Facility with East West Bank providing for a $12.5 million facility, expandable to $15.0 million, with an interest rate of 8.75% as of March 31, 2025[116]. - The company has a history of generating net losses and may continue to do so in the foreseeable future[211]. Stock and Shareholder Information - The company has no current intention of paying dividends on its Common Stock, which may limit returns for investors[81]. - The company approved a share repurchase program in March 2023, renewed in February 2024 and 2025, contingent on favorable market conditions[83]. - The company has 2.7 million shares of Common Stock that may be diluted due to outstanding warrants[69]. - The liquidity of the company's Common Stock is uncertain, with limited trading volume potentially leading to significant price fluctuations[67]. Operational Metrics - The company has positive working capital of $3.6 million as of March 31, 2025, indicating a current assets surplus over current liabilities[47]. - The company has experienced periodic service interruptions and lacks live fail-over capability to switch to another cloud provider, which could impair service delivery[65]. - The company incurred a Goodwill impairment of $14.0 million for the year ended March 31, 2024, due to a decline in share price[80]. - The company's share price was $8.40 on March 31, 2023, declined to $1.39 by March 31, 2024, and partially recovered to $3.16 by March 31, 2025[79].
Cineverse (CNVS) - 2025 Q4 - Annual Report