Inuvo(INUV)2021-11-12 12:54Financial Performance - For the three months ended September 30, 2021, net revenue was $16,841,035, an increase of 82.8% compared to $9,214,350 in the same period of 2020[97]. - ValidClick revenue increased by 88% year-over-year for the third quarter of 2021, while IntentKey revenue rose by 71% in the same period[98]. - Gross profit for the nine months ended September 30, 2021, was $32,628,410, reflecting a 27.5% increase from $25,582,599 in 2020[97]. - The company reported a net loss of $6,359,663 for the nine months ended September 30, 2021, which included non-cash expenses of $2,343,874 for depreciation and amortization[114]. - The company reported a net loss of $6,589,604 for the comparable nine-month period in 2020, which included non-cash expenses of $2,452,930 for depreciation and amortization[115]. Operating Expenses - Operating expenses for the three months ended September 30, 2021, were $14,828,024, a 48.3% increase from $10,001,658 in the same period of 2020[100]. - Marketing costs for the three months ended September 30, 2021, were $10,163,006, up 79.3% from $5,668,707 in 2020[100]. - The change in operating assets and liabilities resulted in cash used in operations of $4,707,321 during the nine months ended September 30, 2021[114]. Cash Flow and Liquidity - In the nine months ended September 30, 2021, net cash used in operating activities was $7,543,216, compared to $4,335,631 in the same period of 2020[113]. - Net cash used in investing activities was $1,180,107 for the nine months ended September 30, 2021, an increase from $852,423 in 2020, primarily due to capitalized internal development costs[116]. - Net cash provided by financing activities was $12,535,122 for the nine months ended September 30, 2021, compared to $14,343,279 in 2020, mainly from proceeds from the sale of common stock[117]. - The company has sufficient liquidity to sustain operations for the next twelve months, but may need additional funding if growth plans are unsuccessful[111]. Intellectual Property and Technology - The company holds 18 issued and seven pending patents, indicating a strong intellectual property position in the market[89]. - The company has a plan to grow its AI technology, the IntentKey, which is expected to lead to positive cash flow from operations if successful[110]. Accounts Receivable and Financial Condition - The company experienced an increase in accounts receivable by $2,645,508 due to increased revenue in the third quarter of 2021[114]. - As of September 30, 2021, there were no off-balance sheet arrangements that could materially affect the company's financial condition[118]. Response to Market Conditions - The company implemented temporary compensation changes for senior officers and employees in response to reduced advertiser marketing budgets due to COVID-19[112]. - The company focused resources on areas with immediate revenue potential while reducing expenses to minimize daily operating disruptions[112]. Capital Raising - The company raised approximately $14.3 million in January 2021 through the sale of securities, and an additional $16.5 million in the second and third quarters of 2020[93]. - As of September 30, 2021, the company had a positive net working capital of $13.1 million[93].