Revenue Performance - Revenue for Q1 2024 was $0.2 million, a decrease of $2.1 million or 90% compared to $2.3 million in Q1 2023, primarily due to a 100% decline in the Recruiters on Demand business [193]. - Marketplace Solutions revenue increased by $7 thousand or 4% to $206 thousand in Q1 2024, partially offsetting declines in other revenue streams [193]. - Other income for Q1 2024 was $275 thousand compared to an expense of $512 thousand in Q1 2023, mainly due to a gain on debt extinguishment of $580 thousand [201]. Cost and Expenses - Cost of revenue decreased to $3 thousand in Q1 2024 from $1.6 million in Q1 2023, representing a decrease of $1.6 million or 99% [194]. - Total operating expenses for Q1 2024 were $1.3 million, a decrease of $2.2 million or 64% from $3.5 million in Q1 2023 [196]. - Sales and marketing expenses for Q1 2024 were $53 thousand, down from $157 thousand in Q1 2023, a reduction of $104 thousand [198]. - Product development expenses decreased to $12 thousand in Q1 2024 from $242 thousand in Q1 2023, primarily due to a $222 thousand decrease in hosting and data expenses [198]. - General and administrative expenses for Q1 2024 were $0.9 million, down from $2.8 million in Q1 2023, including $300 thousand of non-cash stock-based compensation [200]. Profitability and Loss - Gross profit for Q1 2024 was $0.2 million, with a gross profit margin of 98%, compared to a gross profit of $0.7 million and a margin of 29% in Q1 2023 [195]. - Net loss from continuing operations for Q1 2024 was $0.8 million, an improvement from a net loss of $3.4 million in Q1 2023 [202]. - Adjusted EBITDA loss for Q1 2024 was $(420,945), compared to $(1,744,680) in Q1 2023, indicating improved operational performance [208]. Cash Flow and Liquidity - Net cash used in operating activities for Q1 2024 was $0.7 million, down from $1.5 million in Q1 2023 [209]. - As of March 31, 2024, the company had approximately $310 thousand in cash, insufficient to meet working capital needs for the next 12 months [213]. - The company has incurred net losses and negative operating cash flows since inception, raising substantial doubt about its ability to continue as a going concern [214]. - Future operations are expected to be funded through additional securities offerings, as equity offerings have been the primary source of liquidity to date [216]. Strategic Initiatives - The company is undergoing a strategic transformation, planning to sell its Recruiter.com website in 2024 and spin out recruitment-related businesses to Atlantic Energy Solutions, which is being renamed CognoGroup [184]. - A strategic partnership with Job Mobz was announced in March 2023 to transition certain Recruiters on Demand clients and staff, with an ongoing revenue stream expected [187]. - The planned sale of Recruiter.com to Job Mobz is expected to close by June 30, 2024, as part of the ongoing strategic transformation [189]. - The company executed a license agreement with GoLogiq for a worldwide exclusive license to develop fintech technology for a term of 10 years [196]. - The company introduced an AI-powered predictive analytics capability for Mediabistro to uncover job trends in the media industry [191]. Discontinued Operations and Valuation - Certain Recruiter Businesses are classified as discontinued operations, impacting the overall financial results and requiring estimates for cost allocation [237]. - The divestitures of the Recruiter Business represent a strategic shift with a major impact on the company [237]. - The company evaluates the carrying value of reporting units, including goodwill, against their fair value based on estimated discounted cash flows [235]. - Future cash flow estimates involve significant judgment, including assumptions about projected growth rates and industry-specific factors [236]. - The company uses a discounted cash flow methodology to estimate fair value, which includes selecting an appropriate discount rate [236]. - Accounting for discontinued operations involves making judgments regarding net asset values [237]. - The company has not disclosed any applicable market risk information [238].
Recruiter.com(RCRT) - 2024 Q1 - Quarterly Report