10-Q: WEED, Inc. Reports First Quarter 2024 Results with Reduced Net Loss

WEED, Inc. reported a net loss of $170,635 for the first quarter of 2024, an improvement compared to the $197,127 loss in the same period of 2023.

Summary

• WEED, Inc. reported a net loss of $170,635 for the first quarter of 2024, which is an improvement from the $197,127 loss in the first quarter of 2023.
• The company's operating loss decreased to $170,053 from $183,908 year-over-year.
• There was no revenue reported for either the first quarter of 2024 or 2023.
• General and administrative expenses increased slightly to $136,565 from $133,782.
• Professional fees decreased slightly to $25,203 from $26,096.
• Depreciation and amortization expenses decreased significantly to $8,285 from $24,030.
• Interest expense decreased to $599 from $13,106.
• The company's cash balance decreased to $102,696 from $290,409 at the end of the previous quarter.
• The company's monthly cash burn rate is approximately $62,000.
• Total assets decreased to $703,807 from $904,062.
• Total liabilities decreased to $596,333 from $648,753.
• The company has an accumulated deficit of $84,563,215 as of March 31, 2024.

Sentiment

Score: 3

Explanation: The sentiment is negative due to the company's lack of revenue, continued losses, and dependence on external funding. While there are some improvements in reducing losses, the overall financial situation is precarious.

Positives

• The company's net loss decreased by $26,492 year-over-year.
• The operating loss decreased by $13,855 year-over-year.
• Depreciation and amortization expenses decreased significantly.
• Interest expense decreased significantly.
• Total liabilities decreased by $52,420.

Negatives

• The company has not generated any revenue since its inception.
• The company's cash balance decreased significantly.
• The company has a negative working capital of $467,763.
• The company has an accumulated deficit of $84,563,215.
• The company's monthly cash burn rate is approximately $62,000.
• The company's total assets decreased by $200,255.

Risks

• The company's ability to continue as a going concern is in doubt due to ongoing losses and negative working capital.
• The company is dependent on securing additional equity or debt financing.
• There is no assurance that the company will be successful in raising additional capital.
• The company has not generated any revenue since its inception.
• The company's disclosure controls and procedures were not effective as of March 31, 2024.
• The company does not have formal processes related to the identification and approval of related party transactions.

Future Outlook

The company plans to research and possibly enter the hemp and infused beverage industry through its newly acquired property in New York, and conduct Sangre's Cannabis Genomic Study. The company also plans to become a global Seed-to-Sale company providing infrastructure, financial solutions, and real estate options.

Management Comments

• Management is actively pursuing new products and services to begin generating revenues.
• The Company is currently seeking additional sources of capital to fund short term operations.
• Management believes it is more likely than not that the net deferred tax assets will not be fully realizable.

Industry Context

The company operates in the emerging cannabis and hemp market, which is characterized by rapid growth and evolving regulations. The company's focus on research, product development, and infrastructure aligns with the industry's need for innovation and quality. The company's international expansion plans reflect the global nature of the cannabis market.

Comparison to Industry Standards

• It is difficult to compare WEED, Inc. to industry standards due to its lack of revenue and early stage of development.
• Many cannabis companies are focused on cultivation, processing, and retail, while WEED, Inc. is focused on research, infrastructure, and real estate.
• Companies like Canopy Growth, Aurora Cannabis, and Tilray are larger, more established players with significant revenue streams, unlike WEED, Inc.
• WEED, Inc.'s focus on genomic research is unique and could provide a competitive advantage if successful, but it is also a high-risk, high-reward strategy.
• The company's lack of revenue and reliance on external funding is a significant deviation from industry standards for established companies.

Related Party Transactions

• The company has received short-term loans from officers and directors.
• The company has notes payable to related parties totaling $125,637 as of March 31, 2024.
• The company has accrued officer compensation of $128,879 as of March 31, 2024.
• The company has imputed interest expense related to notes payable to related parties.

Stakeholder Impact

• Shareholders are at risk due to the company's financial instability and dependence on external funding.
• Employees may be impacted by the company's financial challenges and potential restructuring.
• Customers are not currently impacted as the company has not yet commenced sales.
• Suppliers and creditors are at risk due to the company's financial instability and potential inability to pay obligations.

Next Steps

• The company plans to research and possibly enter the hemp and infused beverage industry.
• The company plans to conduct Sangre's Cannabis Genomic Study.
• The company will continue to seek additional sources of capital to fund operations.
• The company will look for opportunities to conduct future research, marketing, import and exporting, and manufacturing of any proprietary products on an international level.

Key Dates

Keywords

cannabis, hemp, genomics, cultivation, research, financials, loss, operating expenses, assets, liabilities