10-Q: Mobiquity Technologies Reports First Quarter 2024 Results, Revenue Increases but Losses Persist

Sentiment:

Quarterly Report 20 May 2024 4:00 PM

📋All filings for Mobiquity Technologies, INC

Mobiquity Technologies saw a revenue increase in Q1 2024 compared to Q1 2023, but continues to experience operating losses and faces going concern challenges.

Capital raiseThe company's management has stated that they will seek out equity and/or debt financing to obtain the capital required to meet the company's financial obligations.The company has raised $400,000 in cash from various accredited investors in conjunction with common stock subscription agreements between January and March 2024.The company has also received subscriptions for an additional $275,000 at the same price per share which are expected to be paid during the week of May 20, 2024.

Worse than expectedThe company's net loss, low cash balance, and going concern warning indicate worse than expected financial performance.

Summary

Mobiquity Technologies reported a net loss of $1,042,260 for the first quarter of 2024, compared to a net loss of $1,716,804 for the same period in 2023.
The company's revenue increased to $263,282 in Q1 2024 from $132,224 in Q1 2023, primarily due to an increase in political advertising revenue.
Cost of revenues increased to $211,269 in Q1 2024, up from $62,808 in Q1 2023.
Operating expenses decreased to $1,101,111 in Q1 2024 from $1,425,747 in Q1 2023, mainly due to lower professional fees and license costs.
The company's cash balance was $73,068 as of March 31, 2024, and it had a working capital deficit of $2,265,264.
Mobiquity has an accumulated deficit of $218,082,599 and stockholders' equity of $1,585,188 as of March 31, 2024.
The company's management has expressed substantial doubt about its ability to continue as a going concern due to ongoing losses and the need for additional capital.

Sentiment

Score: 3

Explanation: The document presents a mixed picture with some positive revenue growth but significant concerns about profitability, cash flow, and the company's ability to continue as a going concern. The going concern warning and the need for additional capital are major red flags.

Positives

The company experienced a significant increase in revenue, primarily driven by political advertising.
Operating expenses decreased due to lower professional fees and license costs.
The company is actively developing new software enhancements, including ATOS4P and AdHere, which are expected to contribute to future revenue growth.

Negatives

The company continues to incur significant operating losses.
The company has a substantial accumulated deficit and a working capital deficit.
The company's cash balance is very low, raising concerns about its ability to meet short-term obligations.
The company's auditors have raised substantial doubt about its ability to continue as a going concern.

Risks

The company's ability to continue as a going concern is dependent on obtaining additional capital.
The company faces intense competition and changes in consumer demand.
The company's operations are subject to significant financial and operational risks.
The company has experienced variability in sales and net earnings.
The company's contracts with customers generally do not obligate them to a specified term and they can generally terminate their relationship with the company at any time with a minimal amount of notice.
The loss of one of the company's major customers could have a material adverse effect on its results of operations and financial condition.

Future Outlook

The company plans to focus on technology development, seek equity and/or debt financing, explore partnerships, and identify market opportunities for short-term cash flow. The company also intends to hire new sales and sales support individuals to help generate additional revenue.

Management Comments

Management believes that the company provides one of the most accurate and scaled solutions for data collection and analysis.
Management's strategic plans include the execution of a business plan focused on technology development and improvement.
Management intends to seek out equity and/or debt financing to obtain the capital required to meet the company's financial obligations.
Management is continuing to explore and execute prospective partnering, distribution and acquisition opportunities.
Management is identifying unique market opportunities that represent potential positive short-term cash flow.

Industry Context

The company operates in the programmatic advertising industry, which is experiencing a paradigm shift where user data and targeting intelligence are moving from middlemen to content publishers. The company is positioning itself to capitalize on this trend by offering solutions that allow publishers to own their first-party data and manage their audience segments in-house.

Comparison to Industry Standards

The document does not provide specific comparable companies or projects to benchmark against.
The company's financial results, particularly the ongoing losses and low cash balance, are concerning when compared to industry standards for established technology companies.
The company's reliance on external financing and its going concern warning are not typical for well-established companies in the programmatic advertising space.
The company's focus on developing its own technology platforms, such as ATOS and MobiExchange, is a common strategy in the industry, but the success of these platforms will determine its competitiveness.

Legal Proceedings

Michael Trepeta, a former Co-CEO and director of the Company, filed a lawsuit against the Company and its subsidiary, Mobiquity Networks in April 2023.
The company believes the claims lack merit and intends to vigorously defend same.
The company was notified that its motion to dismiss Mr. Trepeta's action was granted but Mr. Trepeta has filed a notice of appeal.

Related Party Transactions

The company received a $300,000 loan from the Marital Trust GST Subject U/W/O Leopold Salkind, a related party through the company's Board chair.
Dr. Salkind, Board Chair, loaned the company $150,000 of short-term debt financing for working capital.
The company entered into a one-year consulting contract with Mr. Gene Salkind, its Chairman of the Board.
The company issued shares of common stock to Mr. Salkind as payment for accrued and unpaid interest.
The company issued shares of restricted common stock to Mr. Salkind for services previously rendered.

Stakeholder Impact

Shareholders face significant risk due to the company's ongoing losses and going concern warning.
Employees may be concerned about the company's financial stability and future prospects.
Customers may be impacted by the company's ability to continue providing services.
Suppliers and creditors face increased risk of non-payment due to the company's financial difficulties.

Next Steps

The company plans to hire new sales and sales support individuals.
The company will continue to develop and improve its technology platforms.
The company will seek equity and/or debt financing to obtain the capital required to meet its financial obligations.
The company will continue to explore and execute prospective partnering, distribution and acquisition opportunities.
The company will identify unique market opportunities that represent potential positive short-term cash flow.

Key Dates

Date	Description
2020-06-01	Date of Economic Injury Disaster Loan from the Small Business Administration.
2022-01-01	Start date of Secured Convertible Notes to Related Party.
2022-12-29	Date of Walleye Opportunities Master Fund transaction.
2022-12-30	Date of Securities Purchase Agreement with Walleye Opportunities Master Fund.
2023-01-04	Date of payment to the Small Business Administration to pay off outstanding principal and accrued interest on the company's SBA loan.
2023-02-12	Date of Underwriting Agreement with Spartan Capital Securities, LLC relating to a public offering.
2023-02-13	Date of closing of the February 2023 public offering.
2023-06-29	Date of Securities Purchase Agreements for the June 2023 public offering.
2023-06-30	Date of closing of the June 2023 public offering.
2023-08-07	Date of the one-for-15 reverse stock split.
2023-10-05	Date of one-year consulting contract with Mr. Gene Salkind.
2023-10-10	Date of $300,000 loan from the Marital Trust GST Subject U/W/O Leopold Salkind.
2023-11-01	Date of agreement for the purchase and sale of future receivables (2023 Merchant Agreement).
2023-12-15	Date of approval of the 2023 Plan.
2023-12-18	Date of exchange of Series G Preferred Stock into Series H Preferred Stock.
2023-12-19	Date of approval of granting five-year Non-Statutory Stock Options to purchase 1,800,000 shares of common stock.
2024-02-01	Date of agreement for the purchase and sale of future receivables (2024 Merchant Agreement).
2024-02-29	Date of short-term debt financing of $150,000 from Dr. Salkind.
2024-03-13	Date of issuance of a promissory note in the principal amount of $126,500.
2024-03-31	End of the first quarter of 2024.
2024-05-17	Date of the number of shares outstanding of the registrants common stock.

Keywords

programmatic advertising, location data, advertising technology, data intelligence, ATOS platform, MobiExchange, revenue, net loss, going concern, software development, capital raise

Disclaimer:The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.