Fri, Aug 23, 7:56 PM (144 days ago)
In the second quarter of 2023, GrowLife, Inc. reported a significant decline in financial health, with a net loss of $3,377,000 compared to $1,684,000 in the same period of 2022. Revenue reached $147,000, attributed to Bridgetown Mushrooms, marking a notable increase from zero revenue in 2022. However, operating expenses surged to $678,000, up 87% year-over-year, driven by increased staffing and operational costs post-acquisition. The company's total liabilities ballooned to approximately $11.56 million, with a working capital deficit of $2.2 million and an accumulated deficit of $169.19 million. Cash reserves dwindled to $5,398, raising concerns about liquidity and the ability to sustain operations without additional financing. The report highlighted ongoing challenges, including substantial interest expenses ($1.79 million) and derivative liabilities of $3.61 million, indicating a reliance on convertible debt. Management expressed doubts about the company's ability to continue as a going concern, emphasizing the need for immediate capital to fund operations. Future financing will likely involve equity or debt offerings, which may dilute existing shareholders.