Wed, Aug 14, 9:32 PM (153 days ago)
In the first quarter of 2024, Eightco Holdings Inc. reported a significant decrease in revenue, which fell by 39.5% to $9.6 million compared to $15.9 million in Q1 2023. This decline was primarily due to reduced sales in the inventory management solutions segment. Cost of revenues also decreased by 45.0%, leading to a modest gross profit increase of 3.7%. Operating expenses decreased by 18.8% to $4.9 million, while restructuring and severance costs rose by 30.6%. Notably, the company recorded a net income of $1.9 million, a substantial turnaround from a net loss of $49.9 million in the prior year, largely driven by a $6.1 million gain from the forgiveness of earnout obligations. Cash flow from operations showed a net outflow of $723,292. The company ended the quarter with $808,777 in cash, down from $5.2 million at year-end 2023, raising concerns about liquidity and the ability to sustain operations in the coming year. Furthermore, the company is facing compliance issues with Nasdaq regarding minimum bid price and stockholder equity requirements, which could impact its future operations. The amendment to the financial statements was necessitated by a reclassification of a $3 million interest forgiveness from income to equity, affecting net income and additional paid-in capital.