10-K - Motorsport Games Inc. (0001821175) (Filer)

Thu, Mar 20, 8:19 PM (38 days ago)

**Summary of Motorsport Games Inc. (MSGM) Financial Performance:** **Revenue:** - **2024:** $8.7 million - **2023:** $6.9 million - **Growth:** 25.7% **Net Income:** - **2024:** -$3.0 million - **2023:** -$14.3 million - **Improvement:** $11.3 million **Operating Expenses:** - **2024:** $11.2 million - **2023:** $22.7 million - **Reduction:** $11.5 million **Earnings Per Share (EPS):** - **2024:** -$0.94 - **2023:** -$5.56 - **Improvement:** $4.62 **Financial Condition:** - **Cash and Cash Equivalents (2024):** $0.9 million - **Cash and Cash Equivalents (2023):** $1.7 million - **Cash Burn (2024):** $0.2 million per month - **Cash Burn (2023):** $1.2 million per month **Market Position Changes:** - **Stockholders' Equity (2024):** $1.2 million - **Stockholders' Equity (2023):** $2.1 million - **Deficiency Letter from NASDAQ:** Received on November 20, 2024, not in compliance with the Stockholders' Equity Requirement. **Strategic Overview:** - **Product Releases:** Continued focus on digital game and downloadable content sales, particularly for Le Mans Ultimate. - **Cost Reduction:** Implemented additional measures to reduce year-over-year operating expenses through workforce reductions. - **Funding:** Completed a registered direct offering and a concurrent private placement raising approximately $1.0 million in gross proceeds. **Future Outlook:** - **Liquidity:** Continues to explore strategic alternatives and potential options for the business, including the sale or licensing of certain assets. - **Restructuring:** Ongoing efforts to reduce monthly net cash burn and improve liquidity position. - **Risk Factors:** Significant doubt regarding the ability to continue as a going concern, dependence on additional capital, and market position changes. **Risk Factors:** - **Financial Condition:** Significant losses and negative cash flows from operations. - **Business and Industry:** Dependence on popular products, concentration in the racing game genre, and challenges in delivering high-quality products. - **Relationship with Driven Lifestyle:** Control over the direction of the business and potential conflicts of interest. - **Ownership of Class A Common Stock:** Potential delisting from NASDAQ and the impact on market price and liquidity. - **General Risk Factors:** Dependence on management's accounting judgments and estimates, and the impact of changing laws and regulations.