Financial Performance - Total revenue for the three months ended March 31, 2024, was $1,516,000, a decrease of 83.5% compared to $9,194,000 for the same period in 2023[20]. - Net income for the three months ended March 31, 2024, was $114,024,000, compared to a net loss of $9,850,000 for the same period in 2023, indicating a significant turnaround[20]. - The company reported a significant change in fair value of earnout liabilities, resulting in a gain of $118,615,000 for the three months ended March 31, 2024[20]. - The company incurred a net loss of $10.1 million, with an accumulated deficit attributable to common stockholders of $51.4 million[43]. - The company reported total revenue of $1.516 million for the three months ended March 31, 2024, a decrease from $9.194 million for the same period in 2023[59]. - The net loss for the three months ended March 31, 2024, was $114.0 million, compared to a net loss of $9.9 million for the same period in 2023, indicating a significant increase in losses[117]. - The company recognized total revenue of $1.5 million from related party services provided to equity method investments for the three months ended March 31, 2024[59]. Expenses and Liabilities - Operating expenses for the three months ended March 31, 2024, were $6,829,000, down from $18,096,000 in the prior year, reflecting a reduction of 62.2%[20]. - The company incurred a loss from operations of $5.3 million for the three months ended March 31, 2024, and negative cash flows from operating activities of $3.8 million during the same period[43]. - The company has $15.1 million in debt maturing within the next 12 months, with insufficient cash or liquidity to cover these liabilities[45]. - The company has a working capital deficiency of $191.6 million, including a $155.3 million Earnout liability[45]. - The company’s long-term debt as of March 31, 2024 was $20,476 million, an increase from $22,965 million as of December 31, 2023[83]. - The Company’s accrued expenses and other current liabilities totaled $20,741 million as of March 31, 2024, slightly down from $20,840 million as of December 31, 2023[82]. Cash Flow and Investments - Cash and cash equivalents increased to $1,050,000 as of March 31, 2024, from $672,000 at the end of 2023, representing a growth of 56.2%[17]. - The company reported a net cash used in operating activities of $3,768,000 for the three months ended March 31, 2024, an improvement from $6,498,000 in the same period of 2023[23]. - Cash flows from investing activities showed a net cash outflow of $(2.1) million during the three months ended March 31, 2024, primarily due to purchases of computer equipment and a short-term advance to FCG[187]. - Net cash provided by financing activities increased to $6.2 million for the three months ended March 31, 2024, compared to $(0.1) million for the same period in 2023[188]. Business Operations and Strategy - The company operates through three business divisions: Falcon's Creative Group, Falcon's Beyond Destinations, and Falcon's Beyond Brands, focusing on content, technology, and experiences[31]. - The company aims to engage and entertain through a combination of digital and physical experiences, leveraging its multi-disciplinary creative teams[31]. - The company has committed to fund its share of additional investment in Karnival TP-AQ Holdings Limited for constructing Vquarium Entertainment Centers in China[44]. - The first location of Karnival is currently under development in Hong Kong, with the joint venture established to operate amusement centers in China[72]. - The company aims to expand its operations through equity method investments and new product offerings[145]. Internal Controls and Compliance - The company identified material weaknesses in its internal control environment, specifically in monitoring activities and control environment principles[196][197]. - The company has deficiencies in information and communication processes, impacting the quality of information used for internal controls[198]. - Management concluded that the consolidated financial statements present fairly the financial position and results of operations in accordance with U.S. GAAP[204]. - The company is committed to strengthening its control environment and improving internal controls to mitigate risks of accounting errors[202]. Shareholder Information - The weighted average shares outstanding for basic earnings per share was 9,021,520 for the three months ended March 31, 2024[20]. - The company has authorized a total of 650 million shares of common stock, including 500 million shares of Class A Common Stock and 150 million shares of Class B Common Stock[121]. - As of March 31, 2024, there were 5,380,360 warrants outstanding, with an exercise price of $11.50 and an expiration date in October 2028[128].
Falcon's Beyond (FBYD) - 2024 Q1 - Quarterly Report