F-1/A: TNL Mediagene Files Amended Registration for Resale of 8.5 Million Shares Amidst Significant 2024 Losses and Nasdaq Compliance Concerns

TNL Mediagene, an Asia-focused digital media and advertising technology company, filed an amended F-1 registration statement to register the resale of up to 8.5 million ordinary shares by existing securityholders, while disclosing significant 2024 net losses and ongoing efforts to improve financial conditions.

Summary

• The filing is an Amendment No. 2 to Form F-1, registering the offer and resale of up to 8,558,677 ordinary shares by certain selling securityholders, including up to 8,000,000 shares by 3i, LP (from a convertible note) and 558,677 Green Quest Consideration Shares (from an acquisition).
• TNL Mediagene will not receive any proceeds from these resales.
• The company reported a net loss of $84,976,720 for the fiscal year ended December 31, 2024, a substantial increase from $1,215,789 in 2023.
• This significant loss was primarily due to one-off transaction costs of approximately $43.0 million related to the Merger and Nasdaq listing, and an impairment loss of $29.0 million on intangible assets (mainly goodwill from the Mediagene merger).
• Revenue increased by 35.3% to $48,493,897 in 2024 from $35,838,780 in 2023, driven by the full-year consolidation of Mediagene's revenue ($23.9 million) and growth in digital studio revenue.
• The company had recurring losses from operations ($76,344,202), negative working capital ($15,270,853), and net operating cash outflow ($10,212,070) for the fiscal year ended December 31, 2024, raising substantial doubt about its ability to continue as a going concern.
• TNL Mediagene is an 'emerging growth company' and a 'foreign private issuer,' allowing for reduced reporting and corporate governance requirements.
• The company's shares are quoted on Nasdaq under the symbol TNMG, with a closing price of $0.44 per share on July 16, 2025.
• On May 7, 2025, the company received a deficiency letter from Nasdaq for not meeting the minimum $1 bid price requirement.

Sentiment

Score: 3

Explanation: The company faces severe financial challenges, including substantial losses, negative cash flow, and a going concern warning, exacerbated by significant one-off costs and asset impairments. The Nasdaq non-compliance is a major concern. While revenue growth and strategic initiatives in AI and data are positive, the immediate financial health is very weak.

Positives

• Revenue increased by 35.3% to $48.5 million in 2024, driven by the full-year consolidation of Mediagene and growth in digital studio revenue.
• The company has a diversified client base of over 850 clients, including multinational companies and government agencies, with many corporate engagements lasting three to five years.
• Strong foundation in digital media with 25 brands reaching over 45 million average monthly unique users (MUU) and over 189 million average monthly digital footprints, primarily targeting Millennial and Gen Z audiences in Japan and Taiwan.
• Proprietary high-quality firstand zero-party data in the 'cookieless era' provides a competitive advantage for targeted advertising.
• Proven track record of growth and successful integration of ten acquisitions, retaining all founders.
• Adjusted EBITDA margin improved from negative 2.8% in 2023 to negative 1.8% in 2024, indicating progress towards profitability excluding one-off items.
• Secured service contracts exceeding $5.9 million in fees as of December 31, 2024, which have not yet been recognized as revenue.
• Maintained good reputation and banking credit, obtaining approximately $3.9 million in new loan facilities from financial institutions in early 2025.

Negatives

• Incurred a significant net loss of $84,976,720 for the fiscal year ended December 31, 2024, a substantial increase from $1,215,789 in 2023.
• Recurring losses from operations ($76,344,202), negative working capital ($15,270,853), and net operating cash outflow ($10,212,070) for 2024 raise substantial doubt about the company's ability to continue as a going concern.
• Recognized a significant impairment loss of $29.0 million on intangible assets in 2024, primarily $25.5 million against Mediagene goodwill due to anticipated synergies falling short of initial expectations.
• Incurred $42.3 million in one-off transaction costs and related expenses in 2024 due to the Merger and Nasdaq listing.
• Received a Nasdaq deficiency letter on May 7, 2025, for not meeting the minimum $1 bid price requirement, with the closing price at $0.44 per share on July 16, 2025.
• Management has limited experience operating a public company, which may lead to increased costs and diverted attention.
• Identified material weaknesses in internal control over financial reporting, including insufficient accounting personnel, lack of formalized controls, and ineffective IT controls.
• The sale of a substantial number of shares by selling securityholders (up to 8,558,677 shares) could cause significant dilution and depress the share price.
• The company does not intend to pay dividends for the foreseeable future.

Risks

• Adverse economic conditions in Japan, Taiwan, and globally (recession, inflation, geopolitical instability) could negatively affect business, financial condition, and liquidity.
• Failure to increase user numbers or a decline in user/ad engagement could harm revenue and operating results.
• The digital advertising market is continuously and rapidly evolving; failure to respond successfully to changes could adversely affect growth.
• Inability to compete effectively with competitors for users and advertising spend could harm business and operating results.
• Recurring losses from operations, negative working capital, and negative cash flows from operating activities raise substantial doubt about the ability to continue as a going concern.
• Reliance on relationships with businesses for digital media content and advertising technology services means loss of advertisers or reduced spending could significantly impact revenue.
• Inability to successfully integrate TNL and Mediagene businesses, or failure to realize anticipated merger benefits, could incur significant costs and disrupt operations.
• Previous impairments in intangible assets (goodwill) indicate potential for future impairments, negatively affecting financial condition and results of operations.
• Loss of key personnel or failure to attract and retain other highly qualified personnel in the future could harm the business.
• Dependence on collecting and using data for advertising clients; changes in browser/device policies (e.g., limiting cookies) or data sharing could impair effectiveness and revenue.
• Security breaches or perceived breaches could damage brand and reputation, leading to loss of users/advertisers.
• Failure to comply with privacy, data protection, and consumer marketing laws and regulations could result in liabilities, negative publicity, and increased costs.
• The development, use, and potential misuse of generative AI in the digital media ecosystem may adversely affect the business (e.g., competition from AI-produced content, unauthorized use of company content for AI training, legal liability from AI tools).
• Reliance on third-party platforms (Google Search, Google Discover, Facebook, Instagram, YouTube, X) and online search engines; changes to their terms, algorithms, or competitive offerings could adversely affect user acquisition.
• Reliance on licensed trademarks, copyrights, and other intellectual property rights from third-party licensors; loss of these rights could materially adversely affect the business.
• Use of third-party content creators and social media influencers may materially and adversely affect reputation.
• Disruptions in products and services (service delays, outages, data loss) could harm business and operating results.
• Dependence on Amazon Web Services (AWS); any disruption of, degradation in, or interference with AWS use could negatively affect operations.
• Exposure to economic and political risks associated with doing business in Taiwan, particularly due to geopolitical tension with mainland China.
• Japanese and Taiwanese subsidiaries are subject to restrictions on paying dividends or making other payments to the parent company.
• Taiwanese subsidiaries are subject to foreign exchange controls imposed by Taiwanese authorities.
• Business is subject to the risks of earthquakes, fire, power outages, floods, outbreaks of infectious diseases, and other catastrophic events, and to interruption by man-made problems such as terrorism.
• The price of securities, including TNL Mediagene Ordinary Shares and TNL Mediagene Warrants, may be volatile, and the value may decline.
• Sales of a substantial number of securities in the public market by existing securityholders could cause substantial dilution of interests and the market price to decline.
• As a foreign private issuer, the company is not subject to certain U.S. proxy rules and has more lenient reporting obligations, potentially offering less protection to shareholders.
• Risk of losing foreign private issuer status in the future, which could result in significant additional costs and expenses.
• Concentration of ownership among existing executive officers, directors, and their affiliates may prevent new investors from influencing significant corporate decisions.
• Identified material weaknesses in internal control over financial reporting; failure to remediate could impact accurate and timely financial reporting.
• May not be able to comply with the continued listing standards of Nasdaq, which could limit investors' ability to make transactions and subject the company to additional trading restrictions.
• Issuance of additional share capital in connection with financings, acquisitions, investments, or equity incentive plans will dilute all other shareholders.
• No intention to pay dividends for the foreseeable future, meaning return on investment depends on share price appreciation.
• Uncertainty regarding U.S. federal income tax treatment if characterized as a Passive Foreign Investment Company (PFIC).
• Difficulty for investors to protect interests or enforce rights through U.S. Federal courts due to incorporation in Cayman Islands and operations in Japan/Taiwan.

Future Outlook

TNL Mediagene aims to expand its customer base, prudently control expenses, and secure additional capital through equity offerings or debt financings to improve operating and financial conditions. The company plans to continue investing in technology products to increase revenue from retail media, e-commerce, AdTech, and CDP/data licensing, with a long-term goal of providing offerings similar to Software-as-a-Service. Geographical expansion into other East and Southeast Asian markets (excluding mainland China) is a key strategy, though it is expected to increase costs in the short-to-medium term.

Management Comments

• We are Asias next-generation media company built around a portfolio of diverse and trusted digital media brands and a suite of AI-powered advertising and data analytics solutions.
• With data at its core, TNL Mediagene operates media, technology and digital studio businesses primarily in Japan and Taiwan, with a vision to expand into other key East and Southeast Asian markets outside of mainland China.
• Through its trusted digital media brands, AI-powered advertising and data analytics technology and digital studio solutions, TNL Mediagene aims to provide multinational clients with unmatched opportunities to contextually reach and engage with Millennial and Gen Z audiences across the East and Southeast Asian region, one of the largest and most attractive audience segments in the world.
• With its strong foundation in digital media, TNL Mediagene has prioritized collecting more and better data, developing more data-focused services and products, delivering performance advertising that gives its clients higher return on advertising spending, and achieving audience growth by strengthening its audience share in its existing content categories, expanding into new content categories and growing into new geographic markets.
• Our business plans consider, among others, cost management, the issuance of promissory notes and renewal of our loan facilities with financial institutions.
• We believe our combination of businesses allows us to provide clients with a one-stop access point for their digital advertising and marketing needs and gives us an advantage over our competitors, who remain fragmented in their capabilities and occupy limited spaces in this fast-changing digital advertising and marketing ecosystem.
• We believe that our operations in Taiwan, where we have a strong brand as a global advertising and data technology research and development company with a market-leading talent pool and where we benefit from relatively lower costs, provide a competitive advantage.

Industry Context

The digital media and advertising industry is at an inflection point, moving away from traditional mass reach models to data analytics and performance advertising (ROAS) and retail media. The industry is fragmented, and TNL Mediagene aims to leverage its integrated media, technology, and digital studio capabilities to offer a one-stop solution, differentiating itself from competitors. The emergence of generative AI tools presents both opportunities and challenges, potentially increasing competition from AI-produced content and raising legal/ethical concerns.

Comparison to Industry Standards

• In terms of average MUU (45 million for 12 months ended March 31, 2025), TNL Mediagene outranks major media outlets in East Asia and Southeast Asia, including Nikkei and Asahi in Japan, United Daily News and Liberty Times in Taiwan, and South China Morning Post in Hong Kong.
• TNL Mediagene's MUU is comparable to major media outlets in the United States, including CNBC, The Washington Post, and Time.
• The company's audience demographic is prominently Millennial and Gen Z (approximately 57% for the 12 months ended March 31, 2025), which is a highly attractive segment for advertisers.
• The company's focus on firstand zero-party data collection provides a competitive edge in the evolving 'cookieless era' of advertising, unlike companies dependent on traditional tracking cookies.
• The company's advertising network in Taiwan can reach a significant majority of mobile internet users, providing substantially more ad impressions per dollar than crowded programmatic ad networks.

Management Changes

Corporate Governance

Legal Proceedings

• Currently not involved in any material legal or administrative proceedings.
• May from time to time be subject to various legal or administrative claims and proceedings arising in the ordinary course of business, including those related to defamation, intellectual property rights (copyright, trademark, trade secret, patent), rights of publicity and privacy, and regulations of relevant authorities in Japan and Taiwan.

Related Party Transactions

• Service costs paid to Ad Hu Tung Co., Ltd. (Ad Hu) of $406,433 in 2024.
• Service costs paid to AccuHit AI Technology Taiwan Co., Ltd. (AccuHit) of $8,171 in 2024.
• Accounts payable to Ad Hu of $576 and to AccuHit of $346 as of December 31, 2024.
• Key management personnel, Tzu-Wei Chung, provided guarantees for the company's short-term and long-term bank loans.
• Loans from related parties (Yi Chuan, Tzu-Wei Chung, Yu-Ling Yang) totaling $796,462 as of December 31, 2024, with interest rates ranging from 3.119% to 8%.
• November PIPE Convertible Notes were issued to certain members of Blue Ocean's board of directors, management team, and advisory board, and other shareholders of Blue Ocean.
• The Sponsor Lock-Up and Support Agreement was entered into with Sponsor, Apollo, Insiders, and Other Investors regarding Earn-Out Shares and Blue Ocean Private Placement Warrants.
• The Omnibus Note Settlement Agreement was entered into with Blue Ocean and TNL Mediagene, under which TNL Mediagene assumed Blue Ocean's promissory note obligations to Sponsor's lenders.

Stakeholder Impact

• Shareholders face potential for significant dilution from future share sales by selling securityholders, risk of losing investment due to going concern issues and volatile share price, reduced protections as a foreign private issuer, and no dividends expected.
• Employees benefit from the company's commitment to diversity and inclusion, competitive compensation, and health and safety programs, including share-based compensation plans.
• Customers and advertisers are offered a one-stop access point for digital advertising and marketing needs, with a focus on high return on advertising spend (ROAS) and access to Millennial and Gen Z audiences, but face risks if ad effectiveness cannot be consistently demonstrated or due to security breaches.
• Suppliers and creditors may face increased risk due to the company's going concern issues, although the company has maintained good banking credit and secured loan facilities.

Next Steps

• Regain compliance with Nasdaq's minimum $1 bid price rule by November 3, 2025.
• Remediate identified material weaknesses in internal control over financial reporting.
• Actively expand customer base and prudently control expenses.
• Secure additional capital through equity offerings or debt financings.
• Continue to invest in technology products (retail media, e-commerce, AdTech, CDP/data licensing).
• Broaden geographical reach and increase audience in new East and Southeast Asian markets.
• Issue 558,677 Green Quest Consideration Shares in Q2 2025.
• Continue making installment payments under the Initial Note to 3i (cash payment of $0.5 million in May 2025).
• Develop and launch key Diversity & Inclusion educational opportunities.
• Explore future initiatives based on carbon reduction guidance and certifications.

Key Dates

Recommendation

Keywords

Digital Media, Advertising Technology, AI-powered Solutions, SEC Filing, F-1/A, Nasdaq Listing, Financial Performance, Risk Factors, Corporate Governance, Share Resale, Convertible Notes, Acquisitions, Japan Market, Taiwan Market, Millennial Audience, Gen Z Audience, First-Party Data, Zero-Party Data, Retail Media, Digital Studio, Impairment Loss, Going Concern, Foreign Private Issuer, Internal Controls, Share Dilution, Market Volatility