Eightco Announces First Quarter 2024 Financial Results

Core Viewpoint - The company is focusing on capital restructuring to enhance financial stability and drive long-term revenue growth, despite a decrease in revenues due to reduced capital for cell phone sales following the repayment of a convertible note [1][4]. Financial Performance - For the first quarter of 2024, the company reported net income of $4.9 million, a significant improvement from a net loss of $49.9 million in the same quarter of the previous year [3][6]. - Revenues for the first quarter of 2024 were $9.6 million, down from $15.9 million in the prior year quarter, primarily due to a reduction in capital available for inventory purchases after the repayment of the convertible note [3][5]. - Gross profit for the first quarter of 2024 was $1.9 million, reflecting a 3.7% increase from $1.8 million in the prior year quarter, with a gross profit margin of 19.6%, compared to 11.4% in the previous year [6][7]. - Selling, general, and administrative expenses decreased by 35.3% to $3.5 million from $5.3 million in the prior year quarter [6][5]. - EBITDA for the first quarter of 2024 was $3.7 million, compared to a loss of $46.4 million in the prior year quarter [6][7]. Strategic Focus - The company is prioritizing the operations of its largest subsidiary, Forever 8, which provides inventory capital for e-commerce sellers, indicating a strong demand for its services and a proven business model [4][5]. - The repayment of the convertible note has led to the cancellation of 5,846,627 dilutive shares, improving the balance sheet and shareholders' equity [4][5]. - The company aims to leverage its current core operations to scale revenues with a modest increase in expenses, positioning itself for future growth [4][5]. Balance Sheet Improvements - The company achieved over $10 million in balance sheet improvements, including the cancellation of $3 million in interest and the conversion of $1.1 million of interest into 1.4 million shares of common stock [6][7]. - The cancellation of earnout consideration with a fair value of $6.1 million also contributed to the overall financial health of the company [6][7]. Future Outlook - The company expresses confidence in its ability to accelerate growth and drive sustained success for its stakeholders as it emerges from a transformative period [4][5]. - The focus on strategic management and investment in its subsidiaries is expected to create significant value and growth opportunities [12][13].