Paltalk, Inc. Reports Third Quarter 2022 Financial Results

Sequential Quarterly Reduction in Operating Expenses

Cash Balance of $15.5 Million at Quarter End

JERICHO, NY - (NewMediaWire) - November 07, 2022 - Paltalk, Inc. (“Paltalk,” the “Company,” “we,” “our” or “us”) (Nasdaq: PALT), a communications software innovator that powers multimedia social applications, today announced financial and operational results for the third quarter ended September 30, 2022.

Key Financial Highlights for:

Three Months Ended September 30, 2022

      Revenue decreased 22% to $2.6 million compared to the prior year period;

      Net loss increased 157% to $1.1 million compared to the prior year period;

   Adjusted EBITDA loss of $0.8 million compared to Adjusted EBITDA income of $0.3 million for the prior year period;

    Repurchased 207,000 shares of common stock pursuant to the Stock Repurchase Plan at an average price per share of $1.73, or an aggregate amount of $359,000, during the three months ended September 30, 2022;

    Determined that, based on performance as of September 30, 2022 and pursuant to the Securities Purchase Agreement entered into in connection with the ManyCam acquisition, it was likely that gross sales during the earn-out period would exceed $600,000 but be less than $700,000, resulting in a recorded liability in the amount of $150,000 for payment to Visicom; and

    Sales and marketing expenses decreased 23% compared to the second quarter of 2022, which had the effect of increasing Adjusted EBITDA 14% compared to the prior quarter.

Nine Months Ended September 30, 2022

      Revenue decreased 19% to $8.2 million compared to the prior year period;

      Net loss of $2.9 million compared to net income of $1.3 million for the prior year period;

   Adjusted EBITDA loss of $2.2 million compared to Adjusted EBITDA income of $1.5 million for the prior year period;

    Cash balance of $15.5 million at September 30, 2022; after utilizing $2.9 million, including $0.2 million of expenses, for the acquisition of the ManyCam assets and $0.6 million in repurchasing common stock pursuant to our stock repurchase plan (“Stock Repurchase Plan”);

   Repurchased 317,089 shares of common stock pursuant to the Stock Repurchase Plan at an average price per share of $1.80, or an aggregate amount of $572,000, during the nine months ended September 30, 2022;

    Deferred revenue increased 8% to $2.1 million compared to 12/31/2021; and

   The Company has no long-term debt on its balance sheet.

Business Highlights for the Third Quarter Ended September 30, 2022

      Signed up corporate customers for ManyCam subscriptions, advancing the business-to-business channel; and

      Made progress in optimizing ManyCam integration, which we expect to lead to revenue growth.

Patent Litigation Update

On July 23, 2021, the Company filed a patent infringement lawsuit against WebEx Communications, Inc., Cisco WebEx LLC, and Cisco Systems, Inc. in the U.S. District Court for the Western District of Texas. The trial is scheduled for the first quarter of 2023. On September 7, 2022, the United States Patent Office issued a reexamination of U.S. Patent No. 6,683,858. and on September 16, 2022, Cisco filed a motion to stay the lawsuit pending the reexamination.

Management Commentary

Jason Katz, Chairman and CEO of Paltalk, commented, “While our revenue continues to be impacted by the macroeconomic environment, we are pleased with the early traction and results of ManyCam and its integration, which is ongoing, with our portfolio of products of Paltalk, Camfrog and Tinychat. ManyCam is a live streaming software and virtual camera that allows users to deliver professional live videos on streaming platforms, video conferencing apps and distance learning tools, greatly complements our large collection of video-based communities. As ManyCam is a new product offering that sells primarily annual subscriptions, its revenue is accounted for in a manner consistent with similar subscription models, whereby we expect the cash received to initially outpace the subscription revenue recognized. We anticipate that subscription revenue related to ManyCam will increase in future quarters as the deferred revenue generated from ManyCam subscriptions is recognized.

Katz continued, “We have several near-term objectives, which we believe, when achieved, will result in positive milestones for our business and potential growth for our Company. Our team is continuing to adjust our spend to better align with overall macroeconomic conditions and invest in a measured way that ensures responsible cash management. This was apparent during the third quarter as our operating expenses decreased considerably compared to the previous quarter, resulting in a 1% decline in our overall expenses. Our reduction in expenses and efforts to streamline business efficiencies was ongoing throughout the third quarter, and we expect this trend to continue into the fourth quarter. We continue working with Roth Capital Partners, LLC to explore strategic opportunities, including, but not limited to, potential mergers or acquisitions of other assets or entities that are synergistic to our business. In addition, our product team continues to optimize our acquisition of the ManyCam software to not only maximize subscription revenue, but to integrate and cross-sell with our existing customer base and explore business-to-business sales opportunities.”

Katz continued, “Our technology and development teams continue to implement several enhancements to our live video chat applications as well as the integration of card and board games and other features focused on user retention and monetization, which collectively are intended to increase user engagement and revenue opportunities.

We remain focused on developing our consumer application platform strategy by seeking potential partnerships with large third-party communities to whom we could promote a co-branded version of our video chat products and potentially share in the incremental revenues generated by these partner communities. And finally, we are continuing to defend our intellectual property.”

Katz concluded, “Our cash position as of September 30, 2022 remains strong at $15.5 million and puts us in a good position as we seek a return to growth and profitability. We plan to continue to develop our consumer application platforms and defend our intellectual property as we seek to build stockholder value.”

Financial Results for Three Months Ended September 30, 2022

      Revenue for the three months ended September 30, 2022 decreased by $0.8 million, or 22%, to $2.6 million, compared to $3.4 million for the three months ended September 30, 2021. This decline was primarily attributable to the decrease in subscription revenue of 19%, or $0.6 million, related to the macro-economic environment as well as a decrease in technology service revenue as a result of the termination of our partnership with Open Props, Inc. (formerly “YouNow”).

      Advertising revenue decreased by 44% to $0.1 million, due to a slower growing user base as well as overall decline in the advertising market.

      Loss from operations for the three months ended September 30, 2022, totaled $1.1 million, an increase of $0.6 million, or 132%, compared to operating loss of $0.5 million for the three months ended September 30, 2021. The increase in operating loss is primarily due to a decrease in revenue of $0.8 million, coupled with increased product development expenses of $0.2 million, or 11%, in connection with implementation of newly purchased software tools for marketing, as well as increased general and administrative expenses of $0.2 million, or 22% in connection with non-cash amortization in connection with ManyCam asset acquisition.

      Net loss for the three months ended September 30, 2022 totaled $1.1 million, an increase of $0.6 million, or 157%, compared to net loss of $0.4 million for the three months ended September 30, 2021. The resulting net loss per share of common stock for the three months ended September 30, 2022, was $0.11, as compared to a net loss per share of common stock of $0.05 for the three months ended September 30, 2021.

      Adjusted EBITDA loss for the three months ended September 30, 2022 totaled $0.8 million, compared to Adjusted EBITDA income of $0.3 million for the three months ended September 30, 2021.

      Cash and cash equivalents totaled $15.5 million at September 30, 2022, a decrease of $6.3 million compared to $21.6 million at December 31, 2021. Of note, $2.9 million of cash was used for the acquisition of the ManyCam assets and $0.6 million was utilized in repurchasing common stock pursuant to the Stock Repurchase Plan.

      Currently, the Company has no long-term debt on its balance sheet.

Financial Results for Nine Months Ended September 30, 2022

      Revenue for the nine months ended September 30, 2022 decreased by $2.0 million, or 19%, to $8.2 million, compared to $10.2 million for the nine months ended September 30, 2022. This decline was mainly driven by a decrease in subscription revenue and technology service revenue. 

      Loss from operations for the nine months ended September 30, 2022 totaled $2.9 million, compared to operating income of $0.5 million for the nine months ended September 30, 2021.

      Net loss for the nine months ended September 30, 2022 totaled $2.9 million, compared to net income of $1.3 million for the nine months ended September 30, 2021. 

    Adjusted EBITDA loss for the nine months ended September 30, 2022 totaled $2.2 million, compared to Adjusted EBITDA income of $1.5 million for the nine months ended September 30, 2021.

Key Financial and Operating Metrics from Operations (unaudited):

(in thousands, except for percentages)


Three Months Ended

 

 

 

September 30,

 

Change

 

2022

 

 

2021

 

 

$

 

%

Subscription revenue

$

2,539

 

 

$

3,149

 

 

$

(610

)

 

-19

%

Advertising revenue

$

85

 

 

$

151

 

 

$

(66

)

 

-44

%

Technology service revenue

$

--

 

 

$

78

 

 

$

(78

)

 

-100

%

Total revenues

$

2,624

 

 

$

3,378

 

 

$

(754

)

 

-22

%

Loss from operations

$

(1,060

)

 

$

(457

)

 

$

(603

)

 

-132

%

Net loss

$

(1,050

)

 

$

(409

)

 

$

(641

)

 

-157

%

Net cash (used in) provided by operating activities

$

(980

)

 

$

478

 

 

$

(1,458

)

 

-305

%

Adjusted EBITDA (a non-GAAP measure)

$

(781

)

 

$

301

 

 

$

(1,082

)

 

-359

%


 

Nine Months Ended

 

 

 

September 30,

 

Change

 

2022

 

 

2021

 

$

 

%

Subscription revenue

$

7,946

 

 

$

9,410

 

$

(1,464

)

 

-16

%

Advertising revenue

$

249

 

 

$

304

 

$

(55

)

 

-18

%

Technology service revenue

$

--

 

 

$

452

 

$

(452

)

 

-100

%

Total revenues

$

8,195

 

 

$

10,166

 

$

(1,971

)

 

-19

%

(Loss) income from operations

$

(2,857

)

 

$

529

 

$

(3,386

)

 

-640

%

Net (loss) income

$

(2,918

)

 

$

1,329

 

$

(4,247

)

 

-320

%

Net cash (used in) provided by operating activities

$

(2,624

)

 

$

1,090

 

$

(3,714

)

 

-341

%

Adjusted EBITDA (a non-GAAP measure)

$

(2,174

)

 

$

1,504

 

$

(3,678

)

 

-245

%


 

Third Quarter 2022 Conference Call

Date: Monday, November 7, 2022

Time: 4:30 PM ET

Dial-In Phone Numbers:

Toll Free: 877-545-0523

International: 973-528-0016

Participant Access Code: 410178

 

Link: https://www.webcaster4.com/Webcast/Page/2856/46816

 

Replay:

Toll Free: 877-481-4010

International: 919-882-2331

Replay Passcode: 46816

ABOUT PALTALK, INC. (Nasdaq: PALT)

Paltalk, Inc. is a communications software innovator that powers multimedia social applications. Our product portfolio includes Paltalk and Camfrog, which together host one of the world’s largest collections of video-based communities. Our other products include ManyCam, Tinychat and Vumber. The Company has an over 20-year history of technology innovation and holds 14 patents. For more information, please visit: www.paltalk.com.

To be added to our news distribution list, please visit: http://www.paltalk.com/investor-alerts/.

FORWARD-LOOKING STATEMENTS:

This press release contains "forward-looking statements." Such statements may be preceded by the words "intends," "may," "will," "plans," "expects," "anticipates," "projects," "predicts," "estimates," "aims," "believes," "hopes," "potential," or similar words.  Forward-looking statements are not guarantees of future performance, are based on certain assumptions and are subject to various known and unknown risks and uncertainties, many of which are beyond the Company's control, and cannot be predicted or quantified and consequently, actual results may differ materially from those expressed or implied by such forward-looking statements. Such risks and uncertainties include, without limitation, the anticipated impact of the ManyCam acquisition on our business and future financial and operating results; the Company’s ability to improve, market and promote the ManyCam software; the willingness of new and existing users to pay for the ManyCam software; our availability to consummate favorable acquisitions and integrate any companies or properties we acquire; the amount and timing of stock repurchases, if any, under the Company’s stock repurchase plan and our ability to enhance stockholder value through such plan; the Company’s ability to retain the listing of its common stock on The Nasdaq Capital Market; the impact of the COVID-19 pandemic on our results of operations and our business; our ability to effectively market and generate revenue from our applications; our ability to release new applications or improve upon or add features to existing applications on schedule or at all; risks and uncertainties related to our increasing focus on the use of new and novel technologies to enhance our applications, and our ability to timely complete development of applications using new technologies; our ability to effectively secure new software development and licensing customers; our ability to protect our intellectual property rights;  the use of the internet and privacy and protection of user data; risks related to our holdings of digital tokens, including risks related to the volatility of the trading price of digital tokens and our ability to convert digital tokens into fiat currency; and our ability to manage our partnerships and strategic alliances. More detailed information about the Company and the risk factors that may affect the realization of forward-looking statements is set forth in the Company's filings with the Securities and Exchange Commission ("SEC"), including the Company's most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Investors and security holders are urged to read these documents free of charge on the SEC's website at www.sec.gov.

All forward-looking statements speak only as of the date on which they are made. The Company undertakes no obligation to update any forward-looking statement or statements to reflect events or circumstances after the date on which such statement was made, except to the extent required by applicable securities laws.

Investor Contacts:

IR@paltalk.com

 

ClearThink

nyc@clearthink.capital

        917-658-7878

 

 

 

PALTALK, INC.

RECONCILIATION OF GAAP TO NON-GAAP RESULTS


Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Reconciliation of net (loss) income to Adjusted EBITDA:

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income

 

$

(1,050,365

)

 

$

(409,036

)

 

$

(2,918,016

)

 

$

1,329,377

 

Interest (income) expense, net

 

 

(19,750

)

 

 

195

 

 

 

3,004

 

 

 

(1,852

)

Other (income) expense, net

 

 

-

 

 

 

-

 

 

 

27,361

 

 

 

-

 

Gain on extinguishment of term debt

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(506,500

)

Provision for income taxes

 

 

9,712

 

 

 

6,166

 

 

 

30,496

 

 

 

9,466

 

Realized gain from sale of digital tokens

 

 

-

 

 

 

(53,867

)

 

 

-

 

 

 

(301,160

)

Impairment loss on digital tokens

 

 

-

 

 

 

571,458

 

 

 

7.262

 

 

 

756,195

 

Depreciation and amortization expense

 

 

220,124

 

 

 

92,257

 

 

 

404,565

 

 

 

286,447

 

Stock-based compensation expense

 

 

59,729

 

 

 

93,430

 

 

 

271,349

 

 

 

(67,544

)

Adjusted EBITDA

 

$

(780,550

)

 

$

300,603

 

 

$

(2,173,979

)

 

$

1,504,429


Non-GAAP Financial Measures

The Company has provided in this release certain non-GAAP financial measures, including Adjusted EBITDA, to supplement the consolidated financial statements, which are prepared in accordance with generally accepted accounting principles in the United States ("GAAP"). The Company Adjusted EBITDA is defined as net income (loss) adjusted to exclude interest expense (income), net, provision for income taxes, gain on extinguishment of term debt, depreciation and amortization expense, other expense, net, stock-based compensation expense, gain on the termination of an lease, realized loss from sale of digital tokens and impairment loss on digital tokens.

 Management uses these financial metrics internally in analyzing the Company’s financial results to assess operational performance and to determine the Company’s future capital requirements. The presentation of this financial information is not intended to be considered in isolation or as a substitute for the financial information prepared in accordance with GAAP. The Company believes that both management and investors benefit from referring to these financial metrics in assessing our performance and when planning, forecasting and analyzing future periods. The Company believes these financial metrics are useful to investors and others to understand and evaluate the Company’s operating results and it allows for a more meaningful comparison between the Company’s performance and that of competitors. Our use of Adjusted EBITDA has limitations as an analytical tool, and you should not consider this performance measure in isolation from or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are that Adjusted EBITDA does not reflect: cash capital expenditures for assets underlying depreciation and amortization expense that may need to be replaced or for new capital expenditures; interest income (expense), net; other income, net; the potentially dilutive impact of stock-based compensation; gain on the extinguishment of term debt; and the provision for income taxes. Other companies, including companies in our industry, may calculate Adjusted EBITDA differently, which reduces its usefulness as a comparative measure.

Because of these limitations, you should consider these financial metrics along with other financial performance measures, including total revenues, subscription revenue, deferred revenue, net income (loss), cash and cash equivalents, restricted cash, net cash used in operating activities and our financial results presented in accordance with GAAP.

 

 

PALTALK, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS


September 30,

 

 

December 31,

 

 

 

2022

 

 

2021

 

Assets

 

(unaudited)

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

15,498,563

 

 

$

21,636,860

 

Accounts receivable, net of allowances of $3,648 as of September 30, 2022 and December 31, 2021

 

 

120,272

 

 

 

153,448

 

Prepaid expense and other current assets

 

 

308,096

 

 

 

239,258

 

Total current assets

 

 

15,926,931

 

 

 

22,029,566

 

Operating lease right-of-use asset

 

 

179,432

 

 

 

239,491

 

Property and equipment, net

 

 

4,282

 

 

 

69,599

 

Goodwill

 

 

6,326,250

 

 

 

6,326,250

 

Intangible assets, net

 

 

3,800,873

 

 

 

196,543

 

Digital tokens

 

 

-

 

 

 

7,262

 

Other assets

 

 

13,937

 

 

 

13,937

 

Total assets

 

$

26,251,705

 

 

$

28,882,648

 

 

 

 

 

 

 

 

 

 

Liabilities and stockholders’ equity

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

985,105

 

 

$

1,332,632

 

Accrued expenses and other current liabilities

 

 

193,415

 

 

 

344,441

 

Contingent consideration

 

 

150,000

 

 

 

--

 

Operating lease liabilities, current portion

 

 

81,705

 

 

 

80,309

 

Deferred subscription revenue

 

 

2,060,867

 

 

 

1,915,493

 

Total current liabilities

 

 

3,471,092

 

 

 

3,672,875

 

Operating lease liabilities, non-current portion

 

 

97,727

 

 

 

159,182

 

Deferred tax liability

 

 

851,298

 

 

 

-

 

Total liabilities

 

 

4,420,117

 

 

 

3,832,057

 

Commitments and contingencies (Note 11)

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

 

 

Common stock, $0.001 par value, 25,000,000 shares authorized, 9,864,120 shares issued as of September 30, 2022 and December 31, 2021 and 9,515,068 and 9,832,157 shares outstanding as of September 30, 2022 and December 31, 2021, respectively

 

 

9,864

 

 

 

9,864

 

Treasury stock, 349,052 and 31,963 shares as of September 30, 2022 and December 31, 2021, respectively

 

 

(766,536

)

 

 

(194,200)

 

Additional paid-in capital

 

 

35,911,259

 

 

 

35,639,910

 

Accumulated deficit

 

 

(13,322,999

)

 

 

(10,404,983

 

Total stockholders’ equity

 

 

21,831,588

 

 

 

25,050,591

 

Total liabilities and stockholders’ equity

 

$

26,251,705

 

 

$

28,882,648


PALTALK, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)


Three Months Ended

 

 

Nine Months Ended

 

September 30,

September 30,

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Subscription revenue

 

$

2,538,764

 

 

$

3,148,822

 

 

$

7,945,809

 

 

$

9,410,096

 

Advertising revenue

 

 

84,703

 

 

 

151,318

 

 

 

248,827

 

 

 

303,601

 

Technology service revenue

 

 

-

 

 

 

77,507

 

 

 

-

 

 

 

451,755

 

Total revenues

 

 

2,623,467

 

 

 

3,377,647

 

 

 

8,194,636

 

 

 

10,165,452

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenue

 

 

775,330

 

 

 

744,566

 

 

 

2,088,974

 

 

 

2,021,863

 

Sales and marketing expense

 

 

370,772

 

 

 

323,758

 

 

 

1,266,387

 

 

 

836,413

 

Product development expense

 

 

1,485,479

 

 

 

1,334,732

 

 

 

4,537,384

 

 

 

3,930,763

 

General and administrative expense

 

 

1,052,289

 

 

 

859,675

 

 

 

3,151,784

 

 

 

2,090,887

 

Impairment loss on digital tokens

 

 

-

 

 

 

571,458

 

 

 

7,262

 

 

 

756,195

 

Total costs and expenses

 

 

3,683,870

 

 

 

3,834,189

 

 

 

11,051,791

 

 

 

9,636,121

 

(Loss) income from operations

 

 

(1,060,403

)

 

 

(456,542

)

 

 

(2,857,155

)

 

 

529,331

 

Interest income (expense), net

 

 

19,750

 

 

 

(195

)

 

 

(3,004

)

 

 

1,852

 

Gain on extinguishment of term debt

 

 

-

 

 

 

-

 

 

 

-

 

 

 

506,500

 

Realized gain (loss) from the sale of digital tokens

 

 

-

 

 

 

53,867

 

 

 

-

 

 

 

301,160

 

Other income (expense)

 

 

-

 

 

 

-

 

 

 

(27,361

)

 

 

-

 

(Loss) income from operations before provision for income taxes

 

 

(1,040,653

)

 

 

(402,870

)

 

 

(2,887,520

)

 

 

1,338,843

 

Provision for income taxes

 

 

(9,712

)

 

 

(6,166

)

 

 

(30,496

)

 

 

(9,466

)

Net (loss) income

 

$

(1,050,365

)

 

$

(409,036

)

 

$

(2,918,016

)

 

$

1,329,377

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income per share of common stock:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

(0.11

)

 

$

(0.05

)

 

$

(0.30

)

 

$

0.19

 

Diluted

 

$

(0.11

)

 

$

(0.05

)

 

$

(0.30

)

 

$

0.18

 

Weighted average number of shares of common stock used in calculating net (loss) income per share of common stock:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

9,722,157

 

 

 

7,718,034

 

 

 

9,774,904

 

 

 

7,179,953

 

Diluted

 

 

9,722,157

 

 

 

7,718,034

 

 

 

9,774,904

 

 

 

7,201,504

 


PALTALK, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


Nine Months Ended

 

September 30,

 

 

2022

 

 

2021

 

Cash flows from operating activities:

 

 

 

 

 

 

Net (loss) income

 

$

(2,918,016

)

 

$

1,329,377

 

Adjustments to reconcile net (loss) income from operations to net cash (used in) provided by operating activities:

 

 

 

 

 

 

 

 

Depreciation of property and equipment

 

 

65,317

 

 

 

147,947

 

Amortization of intangible assets

 

 

339,247

 

 

 

138,500

 

Amortization of operating lease right-of-use assets

 

 

60,059

 

 

 

54,625

 

Impairment loss on digital tokens

 

 

7,262

 

 

 

756,195

 

Realized gain from the sale of digital tokens

 

 

-

 

 

 

(301,160

)

Gain on extinguishment of term debt

 

 

-

 

 

 

(506,500

)

Stock-based compensation

 

 

271,349

 

 

 

(67,544

)

Bad debt expense

 

 

-

 

 

 

(3,235

)

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Digital tokens

 

 

-

 

 

 

(876,407

)

Accounts receivable

 

 

33,176

 

 

 

(42,943

)

Digital tokens receivable

 

 

-

 

 

 

210,000

 

Operating lease liability

 

 

(60,059

)

 

 

(54,625

)

Digital tokens payable

 

 

-

 

 

 

210,049

 

Prepaid expense and other current assets

 

 

(68,838

)

 

 

25,442

 

Accounts payable, accrued expenses and other current liabilities

 

 

(498,553

)

 

 

270,100

 

Deferred subscription revenue

 

 

145,374

 

 

 

(199,766

)

Net cash (used in) provided by operating activities

 

 

(2,623,682

)

 

 

1,090,055

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

Acquisition of ManyCam assets

 

 

(2,700,000

)

 

 

-

 

Acquisition related costs of ManyCam assets

 

 

(242,279

)

 

 

-

 

Proceeds from the sale of digital tokens

 

 

-

 

 

 

806,618

 

Net cash (used in) provided by investing activities

 

 

(2,942,279

)

 

 

806,618

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

Proceeds from issuance of common stock, net of issuances costs

 

 

-

 

 

 

3,230,739

 

Purchase of treasury stock

 

 

(572,336

)

 

 

-

 

Net cash (used in) provided by financing activities

 

 

(572,336

)

 

 

3,230,739

 

Net (decrease) increase in cash and cash equivalents

 

 

(6,138,297

)

 

 

5,127,412

 

Balance of cash and cash equivalents at beginning of period

 

 

21,636,860

 

 

 

5,585,420

 

Balance of cash and cash equivalents at end of period

 

$

15,498,563

 

 

$

10,712,832

 

Supplemental disclosure of cash flow information:

 

 

 

 

 

 

 

 

Cash paid during the periods:

 

 

 

 

 

 

 

 

Interest

 

$

-

 

 

$

-

 

Taxes

 

$

-

 

 

$

-

 

Non-cash investing and financing activities:

 

 

 

 

 

 

 

 

Write-off of property and equipment

 

$

1,475,649

 

 

$

-

 

Deferred tax liability associated with the acquisition of ManyCam assets

 

$

851,298

 

 

$

-

 

Accrued Contingent Consideration

 

$

150,000

 

 

$

-

 

Modification of operating lease right-of use asset and liability

 

$

-

 

 

$

244,940

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