[10-Q] Bright Mountain Media, Inc. Quarterly Earnings Report
Bright Mountain Media (BMTM) filed its Q3 2025 10‑Q. Revenue was $13.94 million versus $14.15 million a year ago. The company posted a small operating profit of $0.16 million but recorded a net loss of $2.83 million, narrower than $3.26 million last year.
For the nine months, revenue reached $43.54 million versus $39.60 million, while net loss improved to $10.15 million from $13.23 million. Cash and cash equivalents were $0.55 million, with $1.86 million in restricted cash. Management disclosed a substantial doubt about the company’s ability to continue as a going concern, citing a working capital deficit of about $17.3 million and dependence on financing.
Total debt under the related‑party Centre Lane Senior Secured Credit Facility had $83.57 million of outstanding principal. Amendments extended maturities to December 20, 2026 and temporarily converted certain September 30, 2025 cash interest and amortization to payment‑in‑kind. Stockholders’ deficit was $73.37 million. Operating cash flow for the nine months was $0.35 million.
- None.
- Going concern warning: management cites substantial doubt about the ability to continue as a going concern due to a ~$17.3M working capital deficit and financing dependence.
Insights
High leverage, going concern risk; maturities extended to 2026.
BMTM reported Q3 net loss of
Debt remains concentrated with a single related‑party lender. Outstanding principal under the Centre Lane facility was
While nine‑month revenue reached
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF |
1934 For the quarterly period ended
or
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from ___________ to ___________
Commission File Number
(Exact Name of Registrant as Specified in its Charter)
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State or Other Jurisdiction of |
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I.R.S. Employer |
Incorporation or Organization |
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Identification No. |
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Address of Principal Executive Offices |
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Zip Code |
Registrant’s Telephone Number, Including Area Code
Not applicable
Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
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Trading Symbol(s) |
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Name of each exchange on which registered |
None |
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None |
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None |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer |
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Accelerated filer |
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Smaller reporting company |
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Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No
As of November 1, 2025 there were
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
TABLE OF CONTENTS
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Page No. |
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PART I - FINANCIAL INFORMATION |
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Item 1. |
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Unaudited Consolidated Financial Statements: |
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Consolidated Balance Sheets as of September 30, 2025 (unaudited) and December 31, 2024 |
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Unaudited Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended September 30, 2025 and 2024 |
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Unaudited Consolidated Statements of Changes in Stockholders’ Deficit for the nine months ended September 30, 2025 and 2024 |
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Unaudited Consolidated Statements of Cash Flows for the nine months ended September 30, 2025 and 2024 |
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Notes to Consolidated Financial Statements |
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Item 2. |
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Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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Item 3. |
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Quantitative and Qualitative Disclosure About Market Risk |
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Item 4. |
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Controls and Procedures |
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PART II - OTHER INFORMATION |
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Item 1. |
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Legal Proceedings |
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Item 1A. |
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Risk Factors |
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Item 2. |
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Unregistered Sales of Equity Securities and Use of Proceeds |
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Item 3. |
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Default Upon Senior Securities |
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Item 4. |
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Mine Safety Disclosures |
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Item 5. |
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Other Information |
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Item 6. |
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Exhibits |
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Signatures |
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2
Table of Contents
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This report includes forward-looking statements that relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance, or achievements to differ materially from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Words such as, but not limited to, “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “targets,” “likely,” “aim,” “will,” “would,” “could,” and similar expressions or phrases identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and future events and financial trends that we believe may affect our financial condition, results of operation, business strategy and financial needs. Forward-looking statements include, but are not limited to, statements about:
3
Table of Contents
Most of these factors are difficult to predict accurately and are generally beyond our control. You should consider the areas of risk described in connection with any forward-looking statements that may be made herein. Readers are cautioned not to place undue reliance on these forward-looking statements and readers should carefully review this report, our Annual Report on Form 10-K for the year ended December 31, 2024 and our other filings with the U.S. Securities and Exchange Commission in their entirety. Except for our ongoing obligations to disclose material information under the Federal securities laws, we undertake no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events. These forward-looking statements speak only as of the date of this report, and you should not rely on these statements without also considering the risks and uncertainties associated with these statements and our business.
OTHER PERTINENT INFORMATION
Unless specifically set forth to the contrary, when used in this report the terms “Bright Mountain,” the “Company,” “we,” “us," “our” and similar terms refer to Bright Mountain Media, Inc., a Florida corporation, and its subsidiaries. In addition, when used in this report, “third quarter of 2025” refers to the three and nine months ended September 30, 2025, “third quarter of 2024” refers to the three and nine months ended September 30, 2024, and “2024” refers to the year ended December 31, 2024. The information on, or that can be accessed through, our website at www.brightmountainmedia.com is not incorporated by reference in, or considered part of, this Quarterly Report on Form 10-Q.
4
Table of Contents
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
BRIGHT MOUNTAIN MEDIA, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share figures)
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September 30, 2025 |
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December 31, 2024 * |
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(unaudited) |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
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$ |
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Restricted cash |
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Accounts receivable, net |
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Prepaid expenses and other current assets |
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Total current assets |
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Property and equipment, net |
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Intangible assets, net |
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Goodwill |
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Operating lease right-of-use assets, net |
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Other long-term assets |
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Total assets |
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$ |
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$ |
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Liabilities and Stockholders' Deficit |
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Current liabilities: |
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Accounts payable and accrued expenses |
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$ |
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$ |
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Other current liabilities |
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Interest payable - Centre Lane Senior Secured Credit Facility - related party |
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- |
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Deferred revenue |
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Note payable - Centre Lane Senior Secured Credit Facility - related party (current) |
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Total current liabilities |
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Other long-term liabilities |
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Note payable - Centre Lane Senior Secured Credit Facility - related party (long-term) |
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Finance lease liabilities |
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- |
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Operating lease liabilities |
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Total liabilities |
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Stockholders' deficit: |
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Convertible preferred stock, par value $ |
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Common stock, par value $ |
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Treasury stock at cost, |
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Additional paid-in capital |
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Accumulated deficit |
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( |
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Accumulated other comprehensive income |
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Total stockholders' deficit |
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Total liabilities and stockholders' deficit |
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$ |
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$ |
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* Derived from audited consolidated financial statements.
See accompanying notes to unaudited consolidated financial statements.
5
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(unaudited)
(in thousands, except share and per share figures)
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Three Months Ended |
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Nine Months Ended |
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September 30, 2025 |
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September 30, 2024 |
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September 30, 2025 |
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September 30, 2024 |
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Revenue |
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$ |
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$ |
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$ |
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$ |
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Cost of revenue |
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Gross margin |
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General and administrative expenses |
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Income (loss) from operations |
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( |
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Financing and other expense: |
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Other income |
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Interest expense - Centre Lane Senior Secured Credit Facility - related party |
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( |
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( |
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( |
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( |
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Interest expense - |
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Other interest expense |
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( |
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( |
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( |
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Total financing and other expense, net |
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( |
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( |
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( |
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( |
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Net loss before income tax |
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( |
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( |
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( |
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Income tax provision |
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Net loss |
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$ |
( |
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$ |
( |
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$ |
( |
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$ |
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Foreign currency translation |
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( |
) |
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( |
) |
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( |
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Comprehensive loss |
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$ |
( |
) |
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$ |
( |
) |
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$ |
( |
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$ |
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Net loss per common share: |
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Basic |
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$ |
( |
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$ |
( |
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$ |
( |
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$ |
( |
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Diluted |
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$ |
( |
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$ |
( |
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$ |
( |
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$ |
( |
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Weighted-average shares outstanding: |
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Basic |
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Diluted |
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See accompanying notes to unaudited consolidated financial statements.
6
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC
CONSOLIDATED STATEMENTS OF CHANGE IN STOCKHOLDERS’ DEFICIT
(unaudited)
(in thousands, except share figures)
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Common Stock |
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Treasury Stock |
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Additional Paid-in |
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Accumulated |
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Accumulated Other Comprehensive |
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Total Stockholders' |
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Shares |
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Amount |
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Shares |
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Amount |
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Capital |
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Deficit |
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Income |
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Deficit |
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Balance at December 31, 2024 * |
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$ |
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( |
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$ |
( |
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$ |
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$ |
( |
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$ |
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$ |
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Net loss |
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- |
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- |
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- |
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- |
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- |
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( |
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- |
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( |
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Common stock issued for options exercised |
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- |
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- |
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- |
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- |
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Treasury stock |
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- |
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- |
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( |
) |
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- |
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- |
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- |
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- |
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- |
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Stock-based compensation |
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- |
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- |
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- |
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- |
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- |
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- |
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Adjustment from foreign currency translation, net |
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- |
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- |
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- |
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- |
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- |
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- |
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Balance at March 31, 2025 |
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$ |
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( |
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$ |
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$ |
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$ |
( |
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$ |
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$ |
( |
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Net loss |
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- |
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- |
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- |
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- |
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- |
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( |
) |
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- |
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( |
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Stock-based compensation |
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- |
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- |
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- |
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- |
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- |
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- |
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Adjustment from foreign currency translation, net |
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- |
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- |
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- |
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- |
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- |
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- |
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( |
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( |
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Balance at June 30, 2025 |
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$ |
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$ |
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$ |
( |
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$ |
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Net loss |
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- |
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- |
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- |
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- |
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( |
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- |
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( |
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Common stock issued to Centre Lane Partners |
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- |
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- |
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- |
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- |
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Treasury stock |
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- |
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- |
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( |
) |
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- |
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- |
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- |
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- |
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- |
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Stock-based compensation |
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- |
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- |
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- |
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- |
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Adjustment from foreign currency translation, net |
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- |
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- |
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- |
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- |
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- |
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- |
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( |
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( |
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Balance at September 30, 2025 |
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$ |
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( |
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$ |
( |
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$ |
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$ |
( |
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$ |
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$ |
( |
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Common Stock |
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Treasury Stock |
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Additional Paid-in |
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Accumulated |
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Accumulated Other Comprehensive |
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Total Stockholders' |
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Shares |
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Amount |
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Shares |
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Amount |
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Capital |
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Deficit |
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Income |
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Deficit |
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|
|
|
|
|
|
|
|
|
|
||||||||
Balance at December 31, 2023 * |
|
|
|
|
$ |
|
|
|
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net loss |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Common stock issued for services rendered |
|
|
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
|
||||
Treasury stock |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Stock-based compensation |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
|
||
Adjustment from foreign currency translation, net |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Balance at March 31, 2024 |
|
|
|
|
$ |
|
|
|
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net loss |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Common stock issued for options exercised |
|
|
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
||||
Stock-based compensation |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
- |
|
|
|
|
|||
Adjustment from foreign currency translation, net |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Balance at June 30, 2024 |
|
|
|
|
$ |
|
|
|
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net loss |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Common stock issued for options exercised |
|
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
|
|||
Stock-based compensation |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
|
||
Adjustment from foreign currency translation, net |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Balance at September 30, 2024 |
|
|
|
|
$ |
|
|
|
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
||||
*Derived from audited consolidated financial statements.
See accompanying notes to unaudited consolidated financial statements.
7
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(in thousands)
|
|
For the Nine Months Ended |
|
|||||
|
|
September 30, 2025 |
|
|
September 30, 2024 |
|
||
|
|
|
|
|
|
|
||
Cash flows from operating activities: |
|
|
|
|
|
|
||
Net loss |
|
$ |
( |
) |
|
$ |
( |
) |
Adjustments to reconcile net loss to net cash provided by (used in) operations: |
|
|
|
|
|
|
||
Depreciation expense |
|
|
|
|
|
|
||
Interest paid-in-kind on Centre Lane Senior Secured Credit Facility - related party |
|
|
|
|
|
|
||
Amortization of operating lease right-of-use assets |
|
|
|
|
|
|
||
Amortization of debt discount |
|
|
|
|
|
|
||
Amortization of intangible assets |
|
|
|
|
|
|
||
Stock-based compensation |
|
|
|
|
|
|
||
Common stock issued for services rendered |
|
|
|
|
|
|
||
Common stock issued to Centre Lane Partners |
|
|
|
|
|
|
||
Provision for (recovery of) credit losses |
|
|
|
|
|
( |
) |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
||
Accounts receivable |
|
|
|
|
|
|
||
Prepaid expenses and other assets |
|
|
|
|
|
|
||
Operating lease liabilities |
|
|
( |
) |
|
|
( |
) |
Accounts payable and accrued expenses |
|
|
( |
) |
|
|
( |
) |
Other liabilities |
|
|
( |
) |
|
|
( |
) |
Interest payable - Centre Lane Senior Secured Credit Facility - related party |
|
|
( |
) |
|
|
|
|
Interest payable - |
|
|
|
|
|
( |
) |
|
Deferred revenue |
|
|
|
|
|
|
||
Net cash provided by (used in) operating activities |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|
|
||
Cash flows from investing activities: |
|
|
|
|
|
|
||
Purchase of property and equipment |
|
|
( |
) |
|
|
( |
) |
Capitalization of website development costs |
|
|
|
|
|
( |
) |
|
Net cash used in investing activities |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
||
Cash flows from financing activities: |
|
|
|
|
|
|
||
Proceeds from stock option exercises |
|
|
|
|
|
|
||
Principal payments on finance lease obligations |
|
|
( |
) |
|
|
( |
) |
Repayment of principal on Centre Lane Senior Secured Credit Facility - related party |
|
|
( |
) |
|
|
( |
) |
Repayment of principal on |
|
|
|
|
|
( |
) |
|
Net cash used in financing activities |
|
|
( |
) |
|
|
( |
) |
Effect of foreign exchange rates on cash |
|
|
( |
) |
|
|
|
|
Net decrease in cash, cash equivalents, and restricted cash |
|
|
( |
) |
|
|
( |
) |
Cash, cash equivalents, and restricted cash at the beginning of the period |
|
|
|
|
|
|
||
Cash, cash equivalents, and restricted cash at the end of the period |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheets: |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
|
|
$ |
|
||
Restricted cash |
|
|
|
|
|
|
||
Total cash, cash equivalents, and restricted cash |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Supplemental disclosure of cash flow information: |
|
|
|
|
|
|
||
Cash paid for interest |
|
|
|
|
|
|
||
Interest paid-in-kind on Centre Lane Senior Secured Credit Facility - related party |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Supplemental disclosure of non-cash investing and financing activities: |
|
|
|
|
|
|
||
Agency and exit fees to Centre Lane for debt financing |
|
|
|
|
|
|
||
Annual administration fee to Centre Lane for debt financing |
|
|
|
|
|
|
||
See accompanying notes to unaudited consolidated financial statements.
8
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
NOTE 1 – DESCRIPTION OF BUSINESS AND DEVELOPMENTS
Organization and Nature of Operations
Bright Mountain Media, Inc. (together with its wholly-owned subsidiaries, the “Company,” “Bright Mountain” or “we”) is an end-to-end digital media and advertising services company that efficiently connects brands with targeted consumer demographics. We focus on digital publishing, advertising technology, consumer insights, creative services, and media services.
Digital Publishing
Our digital publishing division focuses on developing content that attracts an audience and monetizes that audience through advertising. The current portfolio of owned and operated websites is focused on moms, parenting, families, and more broadly, women. The portfolio consists of popular websites including Mom.com, Cafemom.com, LittleThings.com, and MamasLatinas.com. This demographic is highly sought after by brands and their advertising agencies. We use internal and external technologies to constantly improve the effectiveness and efficiency of the content we create. Our publishing division monetizes its audiences through both direct and programmatic advertising sales.
Advertising Technology
Our advertising technology division focuses on delivering targeted ads to audiences on owned and operated sites as well as third-party publishers in a cost-effective manner through the deployment of proprietary technologies. By developing our own proprietary technology stack, we are able to pass along efficiencies to both the demand and supply side of the ecosystem. Our goal is to enable and support a streamlined, end-to-end advertising model that addresses both demand (buy side) and publisher supply (sell side) programmatic sales and delivery of digital advertisements using an array of audience targeting tools and advertising formats (display, audio, video, CTV, in-app). Programmatic advertising relies on software programs that leverage data and proprietary algorithms to match the optimal selection of an ad with a bid price offered by advertisers.
Consumer Insights
Our consumer insights division focuses on providing primary and secondary research and competitive intelligence to address customers' strategic issues. We provide cutting-edge and dynamic research, offering clients a comprehensive perspective on their consumers. This insight extends to strategic guidance on the optimal timing and channels to effectively connect with target audiences. Our cutting-edge approach combines advanced data analytics, artificial intelligence, and comprehensive market research, to uncover actionable insights that drive informed decision-making.
Creative Services
Our creative services division transforms data into award-winning campaigns. We are uniquely able to leverage insights teams with highly strategic media planning and buying teams to ensure brands not only position their advertising precisely, but also yield impactful business results. Our goal is to combine data-driven decisions with creativity fueled by a deep understanding of modern culture.
Media Services
Our media services division focuses on advertisers and agencies by providing access to premium inventory, leveraging data to optimize programmatic campaigns. Our aim is to empower clients to access the most sought-after advertising spaces across diverse platforms tailored to their specific needs and preferences. Our data-driven approach aims to ensure that ad placements are not only well-targeted, but also continuously optimized for maximum efficiency and return on investment ("ROI"). Our commitment to combining premium inventory access with data-driven programmatic campaign optimization makes us a valuable partner in the success of our clients' advertising and marketing endeavors.
9
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
The Company generates revenue through:
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation and Basis of Presentation
The unaudited consolidated financial statements include the accounts of the Company and all of its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. The accompanying unaudited consolidated financial statements for the three and nine months ended September 30, 2025 and 2024, have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in accordance with rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, they do not include all the information and disclosures required by GAAP for complete consolidated financial statements. In the opinion of management, such unaudited consolidated financial statements include all adjustments (consisting of normal recurring accruals) necessary for the fair presentation of the consolidated financial position and the consolidated results of operations. The consolidated results of operations for periods presented are not necessarily indicative of the results to be expected for the full year or any future periods. The consolidated balance sheet information as of December 31, 2024, was derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. The interim consolidated financial statements should be read in conjunction with that report.
Going Concern and Liquidity
Historically, the Company has incurred losses, which have resulted in an accumulated deficit of approximately $
The Company’s ability to continue as a going concern is dependent upon its ability to meet its liquidity needs through a combination of factors. The Company is currently exploring several strategic alternatives, including restructuring or refinancing its debt, or seeking additional debt, including borrowing under the Centre Lane Senior Secured Credit Facility, or raising equity capital. The ability to access the capital markets depends, in part, upon the volume and market price of the Company's stock, which cannot be assured. Other measures include reducing or delaying certain business activities, and reducing general and administrative expenses, including a reduction in headcount. The ultimate success of these plans is not guaranteed.
The Company's current cash and working capital, as of the filing of this Quarterly Report on Form 10-Q, is not expected to be sufficient to fund its anticipated level of operations over the next twelve months. As a result, such matters create a substantial doubt regarding the Company’s ability to meet its financial obligations and continue as a going concern.
The accompanying unaudited consolidated financial statements are prepared on a going concern basis and do not include any adjustments that might result from uncertainty about the Company’s ability to continue as a going concern.
10
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
Cash and Cash Equivalents
The Company considers all highly liquid investments with a maturity of three months or less, when acquired, to be cash equivalents. The Company maintains its cash with various commercial banks in the United States, and other foreign countries in which the Company operates.
As of September 30, 2025 and December 31, 2024, the Company exceeded the federally insured limit of $
As of September 30, 2025 and December 31, 2024, the Company did not exceed the insurance limit of $
Any loss incurred or a lack of access to such funds could have a significant adverse effect on the Company's financial condition, results of operations, and cash flows.
At September 30, 2025, and December 31, 2024, the Company had $
Restricted Cash
The Company considers cash to be restricted when withdrawal or general use is legally restricted. The Company reports restricted cash as a separate line item in the consolidated balance sheets. At September 30, 2025 and December 31, 2024, the Company had $
Off-balance Sheet Arrangements
There were no off-balance sheet arrangements as of September 30, 2025 and December 31, 2024.
Use of Estimates
The preparation of consolidated financial statements in conformity with GAAP requires management to make certain estimates, judgments, and assumptions. We believe that the estimates, judgments, and assumptions upon which we rely are reasonable based upon information available to us at the time that these estimates, judgments, and assumptions are made. These estimates, judgments, and assumptions can affect the reported amounts of assets and liabilities as of the date of our consolidated financial statements as well as reported amounts of revenue and expenses during the periods presented. Our consolidated financial statements would be affected to the extent there are material differences between these estimates and actual results.
Significant estimates included in the accompanying consolidated financial statements include, valuation of goodwill and intangible assets, allowance for current expected credit losses, percentage of completion for revenue recognition, estimates of amortization period for intangible assets, estimates of depreciation period for property and equipment, discount rates used in the valuation of right-of-use assets and lease liabilities, litigation reserves, the valuation of equity-based transactions, valuation of the Centre Lane Senior Secured Credit Facility carrying value regarding debt modification or extinguishment, and the valuation allowance on deferred tax assets. While these estimates are based on our best knowledge of current events and actions that may affect us in the future, actual results may differ materially from these estimates.
Foreign Currency
We translate the consolidated financial statements of our foreign subsidiaries, which have a functional currency in the respective country’s local currency, to U.S. dollars using month-end exchange rates for assets and liabilities and actual exchange rates for revenue, cost and expenses on the date of the transaction. Translation gains and losses as a result of consolidation are included in accumulated other comprehensive income. Transaction gains and losses are included within general and administrative expenses on the consolidated statements of operations and comprehensive loss.
11
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
Concentrations of Credit Risk
Financial instruments that potentially subject us to concentration of credit risk consist principally of cash, cash equivalents, restricted cash, and accounts receivable. We place our cash, cash equivalents, and restricted cash with high credit-quality financial institutions. Such deposits may be in excess of federally insured limits. In addition, the Company maintains various bank accounts in Thailand and Israel, with some level of insurance. We perform periodic evaluations of the relative credit standing of financial institutions. Any loss incurred or a lack of access to such funds could have a significant adverse impact on the Company's financial condition, results of operations, and cash flows.
We perform credit evaluations of our customers’ financial condition and require no collateral from our customers. We maintain an allowance for current expected credit losses based upon the expected collectability of accounts receivable balances.
The following tables provide information about concentrations that exceed 10% of revenue and accounts receivable for the period:
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, 2025 |
|
|
September 30, 2024 |
|
|
September 30, 2025 |
|
|
September 30, 2024 |
|
||||
Revenue Concentration |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Customers exceeding 10% of revenue |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Percentage of revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Customer 1 |
|
|
% |
|
|
% |
|
|
% |
|
|
% |
||||
Customer 2 |
|
|
% |
|
* |
|
|
* |
|
|
* |
|
||||
Total percentage of revenue |
|
|
% |
|
|
% |
|
|
% |
|
|
% |
||||
* Represents a customer revenue balance less than the 10% threshold.
|
|
September 30, 2025 |
|
|
December 31, 2024 |
|
|
||
Accounts Receivable Concentration |
|
|
|
|
|
|
|
||
Customers exceeding 10% of accounts receivable |
|
|
|
|
|
|
|
||
Percentage of accounts receivable: |
|
|
|
|
|
|
|
||
Customer 1 |
|
|
% |
|
|
% |
|
||
Customer 2 |
|
|
% |
|
* |
|
|
||
Customer 3 |
|
* |
|
|
|
% |
|
||
Customer 4 |
|
* |
|
|
|
% |
|
||
Total percentage of accounts receivable |
|
|
% |
|
|
% |
|
||
* Represents a customer accounts receivable balance less than the 10% threshold.
Effective Accounting Pronouncements Adopted
In August 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40). This ASU simplifies the accounting for certain financial instruments with characteristics of liabilities and equity. The FASB reduced the number of accounting models for convertible debt and convertible preferred stock instruments and made certain disclosure amendments to improve the information provided to users. The
12
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
For 2024 annual reporting, we
Accounting Pronouncements Not Yet Adopted
In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which improves the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the effective tax rate reconciliation and income taxes paid disaggregated by jurisdiction. It also includes certain other amendments to improve the effectiveness of income tax disclosures. This guidance is effective for our Annual Report on Form 10-K for the year ended December 31, 2025. The guidance should be applied on a prospective application, with retrospective application permitted. We are evaluating the effect that this guidance will have on our consolidated financial statements and related disclosures.
In July 2024, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. When applying the current expected credit loss model to current accounts receivable and contract assets arising from transactions accounted for under ASC 606, this standard provides a practical expedient that assumes that current conditions as of the balance sheet date do not change for the remaining life of the asset. Entities are required to disclose whether they have elected the practical expedient and should be applied prospectively. This guidance is effective for our Annual Report on Form 10-K for the year ended December 31, 2025. We are evaluating the effect that this guidance will have on our consolidated financial statements and related disclosures.
In November 2024, and as amended in January 2025, the FASB issued ASU No. 2024-03, Income Statement Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The new guidance requires disaggregated information about certain income statement expense line items on an annual and interim basis. This guidance will be effective for annual periods beginning in the year ending December 31, 2027 and for interim periods thereafter. The new standard permits early adoption and can be applied prospectively or retrospectively. We are evaluating the effect that this guidance will have on our consolidated financial statements and related disclosures.
In September 2025, the FASB issued ASU No. 2025-06, Intangibles - Goodwill and Other Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. This update provides revised guidance aimed at refining how costs related to internal-use software are accounted for. The update removes the concept of distinct project phases and requires that capitalization of software costs begins when management authorizes and commits to funding a computer software project, and when there is a high likelihood the project will be completed and the software will be used to perform the function as intended. When assessing whether completion is probable, entities must carefully consider any substantial uncertainties in development. In addition, the guidance introduces a requirement to disclose capitalized software costs as part of property and equipment. The new standard will take effect in the first quarter of 2028, though early adoption is permitted at the start of any annual reporting period. Entities may adopt the guidance using prospective application, retrospective application, or a modified transition approach. We are evaluating the effect that this guidance will have on our consolidated financial statements and related disclosures.
13
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
NOTE 3 – ACCOUNTS RECEIVABLE
Accounts receivable, net, consisted of the following:
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September 30, 2025 |
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December 31, 2024 |
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(in thousands) |
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Accounts receivable |
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$ |
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$ |
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Unbilled receivables (1) |
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Less: allowance for current expected credit losses |
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( |
) |
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( |
) |
Accounts receivable, net |
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$ |
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$ |
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||
(1) -
Accounts receivable, net, at January 1, 2024 was $
Expected credit losses (recoveries) were approximately $
NOTE 4 – PREPAID EXPENSES AND OTHER ASSETS
Prepaid expenses and other assets consisted of the following:
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September 30, 2025 |
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December 31, 2024 |
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(in thousands) |
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|
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Prepaid insurance (1) |
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$ |
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$ |
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Prepaid software |
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Deposits |
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Subscriptions |
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Other current assets (2) |
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Total prepaid costs and other assets |
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Less: other long-term assets |
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( |
) |
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( |
) |
Prepaid expenses and other current assets |
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$ |
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$ |
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||
(1) -
(2) -
NOTE 5 – PROPERTY AND EQUIPMENT, NET
Property and equipment, net, consisted of the following:
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Useful Life |
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September 30, 2025 |
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December 31, 2024 |
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(in thousands) |
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Computer equipment |
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$ |
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$ |
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Computer software |
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Less: accumulated depreciation |
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( |
) |
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( |
) |
Property and equipment, net |
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$ |
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|
$ |
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||
Depreciation and amortization expense for the three months ended September 30, 2025 and 2024, was $
14
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
NOTE 6 – INTANGIBLE ASSETS, NET
Website acquisitions, net, consisted of the following:
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September 30, 2025 |
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December 31, 2024 |
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(in thousands) |
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Website acquisition assets |
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$ |
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$ |
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Add: website development costs |
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Less: accumulated amortization |
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( |
) |
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( |
) |
Website acquisition assets, net |
|
$ |
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|
$ |
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||
Other intangible assets, net, consisted of the following:
|
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|
|
September 30, 2025 |
|
|
December 31, 2024 |
|
||||||||||||||||||
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Useful |
|
Gross |
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Accumulated |
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Net |
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Gross |
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Accumulated |
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Net |
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(in thousands) |
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Trade name |
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$ |
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$ |
( |
) |
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$ |
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$ |
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$ |
( |
) |
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$ |
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IP/technology |
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( |
) |
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( |
) |
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Customer relationships |
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( |
) |
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( |
) |
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Non-compete agreements |
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( |
) |
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- |
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( |
) |
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- |
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Other intangible assets, net |
|
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|
$ |
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|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||||
|
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September 30, 2025 |
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December 31, 2024 |
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(in thousands) |
|
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|
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||
Website |
|
$ |
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|
$ |
|
||
Other intangible assets |
|
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Intangible assets, net |
|
$ |
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|
$ |
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||
Amortization expense for the three months ended September 30, 2025 and 2024 was approximately $
As of September 30, 2025, expected remaining amortization expense of intangible assets and website acquisition by fiscal year is as follows (in thousands):
Remainder of 2025 |
|
$ |
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2026 |
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2027 |
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2028 |
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2029 |
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Thereafter |
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Total expected amortization expense |
|
$ |
|
15
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
NOTE 7 – GOODWILL
The following table represents the allocation of goodwill as of September 30, 2025, and December 31, 2024:
|
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Owned & Operated |
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Ad Network |
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Insights |
|
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Total |
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(in thousands) |
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December 31, 2024 |
|
$ |
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$ |
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$ |
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$ |
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||||
Additions |
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Impairment |
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September 30, 2025 |
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$ |
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|
$ |
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|
$ |
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|
$ |
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We allocate goodwill to reporting units based on the expected benefit and synergies with our current reporting units. The Company categorizes goodwill into
Goodwill is tested for impairment at least annually and if triggering events are noted prior to the annual assessment. Impairment is deemed to occur when the carrying value of the goodwill associated with the reporting unit exceeds the implied value of the goodwill associated with the reporting unit.
During the year ended December 31, 2024, an impairment assessment was performed on goodwill for the Ad Network, Owned & Operated and Insights reporting units. The assessment used a quantitative assessment, including consideration of the economic, industry and market conditions in addition to the overall financial performance of the Company and these assets. Our quantitative assessment concluded that it was more likely than not that the estimated fair value of the Ad Network, Owned & Operated and Insights reporting units exceeds their carrying amounts. Since the assets are considered recoverable,
There was
NOTE 8 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES
Accounts payable and accrued expenses consisted of the following:
|
|
September 30, 2025 |
|
|
December 31, 2024 |
|
||
(in thousands) |
|
|
|
|
|
|
||
Accounts payable (1) |
|
$ |
|
|
$ |
|
||
Accrued wages, commissions, and bonus |
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Publisher cost |
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Professional fees |
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Subcontractor |
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Other |
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Total accounts payable and accrued expenses |
|
$ |
|
|
$ |
|
||
(1) -
16
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
NOTE 9 – OTHER CURRENT LIABILITIES
Other current liabilities consisted of the following:
|
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September 30, 2025 |
|
|
December 31, 2024 |
|
||
(in thousands) |
|
|
|
|
|
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||
Current portion of long-term operating and financing leases |
|
$ |
|
|
$ |
|
||
Dividend payable |
|
|
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|
||
Project advance expense (1) |
|
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( |
) |
|
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|
|
Litigation reserves |
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Other current liabilities |
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Total other liabilities |
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Less: other long-term liabilities |
|
|
( |
) |
|
|
( |
) |
Other current liabilities |
|
$ |
|
|
$ |
|
||
(1) -
NOTE 10 – CENTRE LANE SENIOR SECURED CREDIT FACILITY
Effective June 1, 2020, the Company entered into a membership interest purchase agreement to acquire
Additional Draws
As of September 30, 2025, Centre Lane Partners had loaned the Company an additional $
On December 26, 2024, the Company and its subsidiaries entered into the Twenty-First Amendment to the Credit Agreement with Centre Lane Partners for the purpose of securing a bond to stay execution of a judgment in the amount of approximately $
In connection with the Twenty-First Amendment, and as consideration therefore, the Company agreed to issue a number of shares of the common stock of the Company, par value $
17
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
Optional Prepayment
The Company may, at any time, voluntarily prepay, in whole or in part (with a minimum prepayment of $
Repayment of Loans
Effective March 31, 2025, the Company, the Lenders, and Centre Lane Partners entered into the Twenty-Second Amendment to the Credit Agreement, pursuant to which the following adjustments were made to the outstanding loans:
Effective September 30, 2025, the Company, the Lenders, and Centre Lane Partners entered into the Twenty-Third Amendment to the Credit Agreement, which applied the following adjustments to loans with outstanding payments due on September 30, 2025, including the following temporary modifications:
18
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
Also in connection with the Twenty-Third Amendment, the Company agreed to issue a number of shares of the common stock of the Company, par value $
For the three and nine months ended September 30, 2025, the Company paid approximately $
At December 31, 2025, the total amount of principal repayment and interest due is approximately $
The below table summarizes the loan balances at September 30, 2025, and December 31, 2024:
|
|
September 30, 2025 |
|
|
December 31, 2024 |
|
||
(in thousands) |
|
|
|
|
|
|
||
Note payable - Centre Lane Senior Secured Credit Facility - related party (current) |
|
$ |
|
|
$ |
|
||
Note payable - Centre Lane Senior Secured Credit Facility - related party (net of discount) |
|
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|
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|
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Net principal |
|
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|
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Add: debt discount |
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Outstanding principal |
|
$ |
|
|
$ |
|
||
The below table summarizes the movement in the outstanding principal during the nine months ended September 30, 2025 and the year ended December 31, 2024:
|
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September 30, 2025 |
|
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December 31, 2024 |
|
||
(in thousands) |
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Opening balance |
|
$ |
|
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$ |
|
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Add: |
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Draws |
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Exit and other fees |
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Interest capitalized |
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Less |
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Payments |
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( |
) |
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|
( |
) |
Outstanding principal |
|
$ |
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|
$ |
|
||
Fees
Under the terms of the Centre Lane Senior Secured Credit Facility, the Company is required to pay Centre Lane Partners a non-refundable annual administration fee equal to $
19
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
Amendments to Centre Lane Senior Secured Credit Facility
Commencing April 2021, the Company and certain subsidiaries entered into various amendments to the Amended and Restated Senior Secured Credit Facility. The Credit Agreement was amended a number of times to provide for additional loans used for working capital and acquisitions. In addition, as part of the transaction, there are exit fees (the "Exit Fees"), which are added and capitalized to the principal amount of the original loan. As of September 30, 2025, there were
Consistent with FASB Accounting Standards Codification ("ASC") Topic 470, Debt (“ASC 470”), the Company is required to perform an analysis of the change in each amendment to determine whether the change is a modification or an extinguishment of debt. Under a modification, no gain or loss is recorded, and a new effective interest rate is established based on the carrying value of the debt and revised cash flow. If the debt is extinguished, the old debt is derecognized and the new debt is recorded at fair value, which becomes the new carrying value. A gain or loss is recorded for the difference between the net carrying value of the original debt and the fair value of the new debt. Additionally, in the event the transaction is with a related party, this gain or loss should be recognized against additional paid-in capital. Interest expense is recorded based on the effective interest rate of the new debt. A debt is considered extinguished if the present value of the new cash flows under the term of the new debt is at least 10% different from the present value of the remaining cash flows under the terms of the old debt.
20
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
The below table summarizes the amendments that were executed by the Company from the inception of the facility to September 30, 2025 (in thousands, except for share data):
Amendment No. |
|
Date |
|
Draw |
|
|
Repayment Date |
|
Interest Rate |
a |
Interest Rate |
a |
Amendment Fee |
|
b |
Common Stock Issued |
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|
Accounting Impact |
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(in thousands, except share data) |
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1 |
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$ |
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$ |
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c |
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2 |
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c |
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3 |
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c |
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4 |
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c |
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5 |
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c |
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6 |
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c |
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7 |
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c |
||||||||
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$ |
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$ |
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8 |
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c |
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9 |
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d |
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10 |
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d |
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11 |
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d |
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12 |
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d |
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13 |
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d |
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14 |
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d |
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15 |
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( |
) |
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d |
|||||||
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$ |
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$ |
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16 |
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d |
||||||||
17 |
f |
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e |
||||||||
19 |
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d |
||||||||
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$ |
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$ |
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20 |
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g |
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21 |
f |
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e |
||||||||
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$ |
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$ |
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23 |
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g |
||||||||
|
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$ |
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$ |
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|||
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$ |
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$ |
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a) - New rates in effect in connection with Amendment Twenty-Two.
b) - Added and capitalized to the principal amount of the original loan.
c) - Second Out Loans.
d) - First Out Loans.
e) - Third Out Loans.
f) - There was no impact on principal or interest and no fees incurred by the Company under Amendments Eighteen and Twenty-Two, thus they are excluded from the table.
g) - There was
Our debt financing arrangements, including long-term debt, expose us to counterparty credit risk as they are solely with a single related party lender. We manage this risk by closely monitoring the related party's financial stability and ensuring it maintains a strong credit rating. No other financial institutions are involved in our debt obligations. As of September 30, 2025 and December 31, 2024, the carrying value of the Centre Lane Senior Secured Credit Facility was $
During the three and nine months ended September 30, 2025, the Company recorded amortization of debt discount of $
21
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
Interest expense for the three and nine months ended September 30, 2025 and 2024, consisted of the following:
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, 2025 |
|
|
September 30, 2024 |
|
|
September 30, 2025 |
|
|
September 30, 2024 |
|
||||
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest expense |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Amortization |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total interest expense |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
NOTE 11 – 10% CONVERTIBLE PROMISSORY NOTES
On November 30, 2018, the Company issued
The outstanding principal and interest of the Convertible Notes were due and payable in November 2023, and on July 1, 2024, the Company repaid the outstanding principal of $
NOTE 12 – LEASES
The Company accounts for its operating lease under FASB ASC Topic 842, Leases (“ASC 842”), which requires lessees to recognize on the balance sheet at lease commencement, the lease assets and the related lease liabilities for the rights and obligations created by operating and finance leases with lease terms of more than 12 months.
Operating Lease
The Company leases its corporate offices in Boca Raton, Florida under a long-term non-cancellable lease agreement. An addendum to the lease dated June 14, 2022, set a lease renewal term of
At September 30, 2025 and December 31, 2024, the operating lease right-of-use asset was $
At September 30, 2025 and December 31, 2024, the operating lease right-of-use liability was $
Over the lease term, the Company is required to amortize the operating lease asset and record interest expense on the lease liability created at lease commencement. Operating lease expense was approximately $
The Company’s non-lease components are primarily related to property maintenance and other operating services, which vary based on future outcomes and are recognized in rent expense when incurred and not included in the measurement of the lease liability.
22
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
Operating Lease Subleases
On April 14, 2024 and July 1, 2024, the Company entered into
At September 30, 2025 and December 31, 2024, the operating lease subleases right-of-use liability was $
Operating lease sublease income was approximately $
Finance Lease
On October 1, 2023, the Company entered into a lease agreement for computer equipment with a lease term of
At September 30, 2025 and December 31, 2024, finance lease asset was $
At September 30, 2025 and December 31, 2024, finance lease liability was $
Finance lease expense for the three months ended September 30, 2025 was $
23
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
As of September 30, 2025 and December 31, 2024, the asset and lease liability for the operating and finance lease are summarized as follows (in thousands):
|
|
September 30, 2025 |
|
|
December 31, 2024 |
|
||
(in thousands) |
|
|
|
|
|
|
||
Assets: |
|
|
|
|
|
|
||
Total operating lease right-of-use asset |
|
$ |
|
|
$ |
|
||
Total finance lease asset (1) |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Liabilities: |
|
|
|
|
|
|
||
Operating lease liability, current |
|
$ |
|
|
$ |
|
||
Operating sublease liability, net of current portion |
|
|
|
|
|
|
||
Operating lease liability, net of current portion |
|
|
|
|
|
|
||
Total operating lease liability |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Finance lease liability, current |
|
$ |
|
|
$ |
|
||
Finance lease liability, net of current portion |
|
|
|
|
|
|
||
Total finance lease liability |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Weighted-average remaining lease term (in years): |
|
|
|
|
|
|
||
Operating lease |
|
|
|
|
|
|
||
Finance lease |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Weighted-average discount rate: |
|
|
|
|
|
|
||
Operating lease |
|
|
% |
|
|
% |
||
Finance lease |
|
|
% |
|
|
% |
||
(1) - Finance lease represents computer software, see Note 5, Property and Equipment, Net, to the Company's consolidated financial statements.
24
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
NOTE 13 – REVENUE RECOGNITION
The following table represents our revenue disaggregated by type:
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, 2025 |
|
|
September 30, 2024 |
|
|
September 30, 2025 |
|
|
September 30, 2024 |
|
||||
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Digital publishing |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Advertising technology |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Consumer insights |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Creative services |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Media services |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total revenue |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Geographic Information
Revenue by geography is based on the country of the Company’s contracting entity. Total United States revenue was approximately
As of September 30, 2025, and December 31, 2024, approximately
Deferred Revenue
The movement in deferred revenue during the nine months ended September 30, 2025 and the year ended December 31, 2024 comprised the following:
|
|
September 30, 2025 |
|
|
December 31, 2024 |
|
|
||
(in thousands) |
|
|
|
|
|
|
|
||
Deferred revenue at the start of the period |
|
$ |
|
|
$ |
|
|
||
Amounts invoiced during the period |
|
|
|
|
|
|
|
||
Less: revenue recognized during the period |
|
|
( |
) |
|
|
( |
) |
|
Deferred revenue at the end of the period |
|
$ |
|
|
$ |
|
|
||
NOTE 14 – STOCK-BASED COMPENSATION
On April 14, 2022, the Board of Directors of the Company and the Compensation Committee of the Board of Directors adopted and approved the 2022 Bright Mountain Media Stock Option Plan (the “2022 Stock Option Plan”). The 2022 Stock Option Plan provides for the grant of awards to eligible employees, directors and consultants in the form of stock options. The purpose of the 2022 Stock Option Plan is to provide an incentive to attract and retain directors, officers, consultants, advisors and employees whose services are considered valuable, to encourage a sense of proprietorship and to stimulate an active interest of such persons in our development and financial success. The 2022 Stock Option Plan has a term of
Options
As of September 30, 2025, options to purchase
25
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
Compensation expense recorded in connection with the 2022 Stock Option Plan was $
The following table presents the activity of the Company’s outstanding common stock options for the nine months ended September 30, 2025:
|
|
Number of Options |
|
|
Weighted Average Exercise Price |
|
|
Weighted Average Remaining Contractual Term |
|
|
Aggregate Intrinsic Value |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Common stock options: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Balance outstanding at December 31, 2024 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
Granted |
|
|
|
|
$ |
|
|
|
- |
|
|
$ |
|
|||
Exercised |
|
|
( |
) |
|
$ |
|
|
|
- |
|
|
$ |
|
||
Forfeited |
|
|
( |
) |
|
$ |
|
|
|
- |
|
|
$ |
|
||
Expired |
|
|
( |
) |
|
$ |
|
|
|
- |
|
|
$ |
|
||
Balance outstanding at September 30, 2025 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
Exercisable at September 30, 2025 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
Unvested at September 30, 2025 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
During the nine months ended September 30, 2025,
As of September 30, 2025, there were total unrecognized compensation costs related to non-vested share-based compensation arrangements of $
The Company estimates the fair value of share-based compensation utilizing the Black-Scholes option pricing model, which is dependent upon several variables such as the expected option term, expected volatility of our stock price over the expected option term, expected risk-free interest rate over the expected option term, expected dividend yield rate over the expected option term, and an estimate of expected forfeiture rates.
The following table provides the weighted-average assumptions used in determining the fair value of the stock option awards for the nine months ended September 30, 2025 and 2024:
|
|
September 30, 2025 |
|
|
September 30, 2024 |
|
||
|
|
|
|
|
|
|
||
Expected life (years) |
|
|
|
|
||||
Expected volatility |
|
|
% |
|
|
% |
||
Risk-free interest rate |
|
|
% |
|
|
% |
||
Dividend yield |
|
|
% |
|
|
% |
||
Expected forfeiture rate |
|
|
% |
|
|
% |
||
The expected life is computed using the simplified method, which is the average of the vesting term and the contractual term. The expected volatility is based on an average of similar public company's historical volatility, as the Company's common stock is quoted in the over-the-counter market on the OTCQB Tier of the OTC Markets, Inc. The risk-free interest rate is based on the U.S. Treasury yields with terms equivalent to the expected term of the related option at the time of the grant.
26
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
Dividend yield is based on historical trends. While the Company believes these estimates are reasonable, the compensation expense recorded would increase if the expected life was increased, a higher expected volatility was used, or if the expected dividend yield increased. The Company has elected to account for forfeitures as they occur.
NOTE 15 – FAIR VALUE MEASUREMENTS
The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities).
The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:
Level 1: Valuation is based on unadjusted quoted prices in active markets for identical assets and liabilities that are accessible at the reporting date. Because valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these products does not entail a significant degree of judgment.
Level 2: Valuation is determined from pricing inputs that are other than quoted prices in active markets that are either directly or indirectly observable as of the reporting date. Observable inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and interest rates and yield curves that are observable at commonly quoted intervals.
Level 3: Valuation is based on inputs that are both significant to the fair value measurement and unobservable. Level 3 inputs includes situations where there is little, if any, market activity for the financial instrument. The inputs into the determination of fair value generally require significant management judgment or estimation.
Fair Value Considerations
Financial instruments recognized in the consolidated balance sheets consist of cash, cash equivalents, restricted cash, accounts receivable, other liabilities and accounts payable. The Company believes that the carrying value of its current financial instruments approximates their fair value due to the short-term nature of these instruments. The carrying value of the Centre Lane Senior Secured Credit Facility approximates the fair value due to their nature and level of risk.
Assets Measured at Fair Value on a Non-Recurring Basis
The Company has certain non-financial assets that are measured at fair value on a non-recurring basis when there is an indicator of impairment, and they are recorded at fair value only when impairment is recognized. These assets include goodwill and intangible assets, net.
27
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
Goodwill and Intangibles Assets
Goodwill and intangible assets are tested for impairment at least annually, and if triggering events are noted prior to the annual assessment. Impairment is deemed to occur when the carrying value associated with the reporting unit exceeds the implied value associated with the reporting unit. We estimated the fair value of our reporting units utilizing an income approach (discounted cash flow method), which incorporated significant unobservable Level 3 inputs.
During the year ended December 31, 2024, an impairment assessment was performed on goodwill for the Ad Network, Owned & Operating and Insights reporting units. The assessment used a quantitative assessment, including consideration of the economic, industry and market conditions in addition to the overall financial performance of the Company and these assets. Our quantitative assessment concluded that it was more likely than not that the estimated fair value of the Ad Network, Owned & Operating and Insights reporting units exceeds its carrying amount. Since the assets are considered recoverable,
There was
Centre Lane Senior Secured Credit Facility
The Company is required to perform an analysis of the change in each amendment to the Centre Lane Senior Secured Credit Facility to determine whether the change is a modification or an extinguishment of debt. Under a modification, no gain or loss is recorded, and a new effective interest rate is established based on the carrying value of the debt and revised cash flow. If the debt is extinguished, the old debt is derecognized and the new debt is recorded at fair value, which becomes the new carrying value.
The Company utilizes a third-party valuation company to calculate the present value of the cash flows under the terms of each new amendment and determines if it was substantially different by at least
NOTE 16 – COMMITMENTS AND CONTINGENCIES
Litigation
In accordance with applicable accounting guidance, the Company establishes an accrued liability for litigation and regulatory matters when those matters present loss contingencies that are both probable and estimable. In such cases, there may be exposure to loss in excess of any amounts accrued. When a loss contingency is not both probable and estimable, the Company does not establish an accrued liability. As a litigation or regulatory matter develops, the Company, in conjunction with any outside counsel handling the matter, evaluates on an ongoing basis whether such matter presents a loss contingency that is probable and estimable. If, at the time of evaluation, the loss contingency related to a litigation or regulatory matter is not both probable and estimable, the matter will continue to be monitored for further developments that would make such loss contingency both probable and estimable. When a loss contingency related to a litigation or regulatory matter is deemed to be both probable and estimable, the Company will establish an accrued liability with respect to such loss contingency and record a corresponding amount of litigation-related expense. The Company will then continue to monitor the matter for further developments that could affect the amount of any such accrued liability.
28
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
Ladenburg
On July 11, 2023, Ladenburg Thalmann & Co. Inc. (“Ladenburg”) filed an action against the Company for breach of contract in the United States District Court for the Southern District of Florida (the “District Court”), Case No. 9:23-cv-81019-AMC. Ladenburg alleges that it entered into an Investment Banking Agreement (the “Agreement”) with the Company on September 1, 2020. According to Ladenburg, that Agreement provided that Ladenburg would be the exclusive investment advisor and banker for the Company. Ladenburg alleges that the Agreement entitles them to a fee for any financing transactions (debt financing or merger and acquisition transactions) that the Company engages in during the term of the contract. In April 2023, the Company informed Ladenburg of the impending acquisition of Big Village Insights, Inc. and Big Village Agency, LLC (together, the "Big Village Acquisition"). Ladenburg now seeks $
Other Litigation
Other litigation is defined as smaller claims or litigation that are neither individually nor collectively material. It does not include lawsuits that relate to collections.
The Company is party to various other legal proceedings that arise in the ordinary course of business, separate from normal course accounts receivable collections matters. Due to the inherent difficulty of predicting the outcome of these other legal proceedings, the Company cannot predict the eventual outcome of these matters, and it is reasonably possible that some of them could be resolved unfavorably to the Company. As a result, it is possible that the Company’s results of operations or cash flows in a particular fiscal period could be materially affected by an unfavorable resolution of pending litigation or contingencies. The outcome is not determinable as of the issuance of these consolidated financial statements.
NOTE 17 – STOCKHOLDERS’ DEFICIT
Preferred Stock
The Company has authorized
The designations, rights and preferences of the Series F-1, Series F-2 and Series F-3 are identical, other than the dividend rate, liquidation preference and date of automatic conversion into shares of our common stock.
29
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
Additional terms of the designations, rights and preferences of the Series F-1, Series F-2 and Series F-3 include:
Other designations, rights and preferences of each series of preferred stock are identical, including:
Both the voluntary and automatic conversion formulas are subject to proportional adjustment in the event of stock splits, stock dividends and similar corporate events.
There were
At September 30, 2025 and December 31, 2024, there was an accrued unpaid preference dividend of $
Common Stock
Shares of Common Stock under the 2022 Stock Option Plan
On April 14, 2022, the Board and the Compensation Committee of the Board adopted and approved the 2022 Stock Option Plan. The 2022 Stock Option Plan has a term of
30
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
Issue of Common Stock
During the three and nine months ended September 30, 2025, the Company issued shares of our common stock as follows (in thousands, except share data):
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, 2025 |
|
|
September 30, 2025 |
|
||||||||||
|
|
Shares (#) |
|
|
Value |
|
|
Shares (#) |
|
|
Value |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Common stock issued to Centre Lane related to debt financing |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
Common stock issued for options exercised |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
Shares of common stock issued, net |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
During the three and nine months ended September 30, 2024, the Company issued shares of our common stock as follows (in thousands, except share data):
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, 2024 |
|
|
September 30, 2024 |
|
||||||||||
|
|
Shares (#) |
|
|
Value |
|
|
Shares (#) |
|
|
Value |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Common stock issued for options exercised |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
Common stock issued for services rendered |
|
|
|
|
$ |
- |
|
|
|
|
|
$ |
|
|||
Shares of common stock issued, net |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
Treasury Stock
During the nine months ended September 30, 2025, two shareholders relinquished
Warrants
At September 30, 2025 and December 31, 2024, we had
Approximately
31
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
A summary of the Company’s warrants outstanding as of September 30, 2025 and December 31, 2024, is presented below.
September 30, 2025 |
|
|||||||||
Exercise Price |
|
|
Number Outstanding |
|
|
Gross Cash Proceeds |
|
|||
$ |
|
|
|
|
|
$ |
|
|||
$ |
|
|
|
|
|
$ |
|
|||
|
|
|
|
|
|
$ |
|
|||
December 31, 2024 |
|
|||||||||
Exercise Price |
|
|
Number Outstanding |
|
|
Gross Cash Proceeds |
|
|||
$ |
|
|
|
|
|
$ |
|
|||
$ |
|
|
|
|
|
$ |
|
|||
|
|
|
|
|
|
$ |
|
|||
NOTE 18 – LOSS PER SHARE
As of September 30, 2025 and 2024, there were
Basic net loss per share is computed by dividing the net earnings attributable to common shareholders by the weighted-average number of common shares outstanding during the period.
Diluted loss per share is computed by dividing net income attributable to common shareholders by the weighted-average number of common shares outstanding, increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued. Conversion or exercise of the potential common shares is not reflected in diluted earnings per share unless the effect is dilutive. The dilutive effect, if any, of outstanding common share equivalents is reflected in diluted earnings per share by application of the treasury stock method, and if-converted method, as applicable.
The following tables reconcile actual basic and diluted earnings per share for the three and nine months ended September 30, 2025 and 2024.
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, 2025 |
|
|
September 30, 2024 |
|
|
September 30, 2025 |
|
|
September 30, 2024 |
|
||||
(in thousands, except per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Numerator: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net loss |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Denominator: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted-average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net loss per common share |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Diluted |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
32
Table of Contents
BRIGHT MOUNTAIN MEDIA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2025
(Unaudited)
The anti-dilutive securities excluded from the weighted-average shares used to calculate the diluted net loss per common share for the three and nine months ended September 30, 2025 and 2024 were as follows:
|
|
September 30, 2025 |
|
|
September 30, 2024 |
|
||
Shares unvested and subject to exercise of stock options |
|
|
|
|
|
|
||
Shares subject to exercise of warrants |
|
|
|
|
|
|
||
NOTE 19 – RELATED PARTIES
Centre Lane Partners
Centre Lane Partners has provided, and continues to provide, funding to assist the Company with its liquidity needs through the Centre Lane Senior Secured Credit Facility.
In connection with the Twenty-First Amendment, on December 26, 2024, the Company issued
BV Agency, LLC, and Centre Lane Partners own approximately
SEC rules define a related party as including (i) any director or executive officer of the Company, or any immediate family member thereof, (ii) any director nominee, or any immediate family member thereof, and (iii) a 5% or greater shareholder of the Company, or any immediate family member thereof. As a result, BV Agency, LLC, and Centre Lane Partners together are considered to be related parties of the Company. Through September 30, 2025, the Company has entered into
The total related party debt owed to Centre Lane Partners was $
Preferred Stock
At September 30, 2025 and December 31, 2024, there was an accrued unpaid preference dividend of $
NOTE 20 – INCOME TAXES
The Company recorded a tax provision of $
At September 30, 2025 and December 31, 2024, the Company had
On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was signed into law. The OBBBA introduces changes to U.S. tax policy, trade regulations, and federal spending priorities, including provisions such as the permanent extension of certain expiring provisions of the 2017 Tax Cuts and Jobs Act. We do not anticipate the OBBBA to have a significant impact to our consolidated financial statements, and will continue to evaluate the impact as more guidance becomes available.
33
Table of Contents
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion and analysis of our financial condition and results of our operations should be read in conjunction with the consolidated financial statements and related notes included elsewhere in this report and in our Annual Report on Form 10-K for the year ended December 31, 2024. In addition to historical consolidated financial information, this discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those discussed below. Factors that could cause or contribute to these differences include, but are not limited to, those identified below, and in the section "Cautionary Statement Regarding Forward-Looking Information", those discussed in “Item 1A. Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2024, and those discussed in any subsequent filing we make with the SEC.
Business Overview
Organization and Nature of Operations
Bright Mountain Media, Inc. (together with its wholly-owned subsidiaries, the “Company,” “Bright Mountain” or “we”) is an end-to-end marketing services company that helps brands with the right audiences, at the right time, with the right message, both effectively and efficiently by removing the middlemen in the marketing workflow. Our end-to-end offerings combine consumer insights with creative services, media services, and advertising technology to deliver solutions to improve audience fidelity for brands. We focus on digital publishing, advertising technology, consumer insights, creative services, and media services.
Digital Publishing
Our digital publishing division focuses on developing content that attracts an audience and monetizes that audience through advertising. The current portfolio of owned and operated websites is focused on moms, parenting, families, and more broadly, women. The portfolio consists of popular websites including Mom.com, Cafemom.com, LittleThings.com, and MamasLatinas.com. This demographic is highly sought after by brands and their advertising agencies. We use internal and external technologies to constantly improve the effectiveness and efficiency of the content we create. Our publishing division monetizes its audiences through both direct and programmatic advertising sales.
Advertising Technology
Our advertising technology division focuses on delivering targeted ads to audiences on owned and operated sites as well as third-party publishers in a cost-effective manner through the deployment of proprietary technologies. By developing our own proprietary technology stack, we are able to pass along efficiencies to both the demand and supply side of the ecosystem. Our goal is to enable and support a streamlined, end-to-end advertising model that addresses both demand (buy side) and publisher supply (sell side) programmatic sales and delivery of digital advertisements using an array of audience targeting tools and advertising formats (display, audio, video, CTV, and in-app). Programmatic advertising relies on software programs that leverage data and proprietary algorithms to match the optimal selection of an ad with a bid price offered by advertisers.
Consumer Insights
Our consumer insights division focuses on providing primary and secondary research, competitive intelligence, and expert insight to address customers' strategic issues. We provide cutting-edge and dynamic research, offering clients a comprehensive perspective on their consumers. This insight extends to strategic guidance on the optimal timing and channels to effectively connect with target audiences. Our cutting-edge approach combines advanced data analytics and comprehensive market research, to uncover actionable insights that drive informed decision-making.
Creative Services
Our creative services division transforms data into award-winning campaigns. We are uniquely able to leverage insights teams with highly strategic media planning and buying teams to ensure brands not only position their advertising precisely, but also yield impactful business results. Our goal is to combine data-driven decisions with creativity fueled by a deep understanding of modern culture.
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Table of Contents
Media Services
Our media services division focuses on advertisers and agencies by providing access to premium inventory, and leveraging data to optimize programmatic campaigns. Our aim is to empower clients to access the most sought-after advertising spaces across diverse platforms tailored to their specific needs and preferences. Our data-driven approach ensures that ad placements are not only well-targeted, but also continuously optimized for maximum efficiency and return on investment. Our commitment to combining premium inventory access with data-driven programmatic campaign optimization makes us an indispensable partner in the success of our clients' advertising and marketing endeavors.
The Company generates revenue through:
Key Factors Affecting Our Performance
Seasonal Fluctuations. Typically advertising technology companies report a material portion of their revenues during the third and fourth calendar quarters as a result of back-to-school and holiday-related advertising spend. We continue to experience this trend in our advertising technology division. Because of seasonal fluctuations, there can be no assurance that the results of any quarter or full year will be indicative of results for future years or quarters.
Limited Number of Customers. During the nine months ended September 30, 2025 one customer represented 14.4% of revenue. During the nine months ended September 30, 2024 one customer represented 13.4% of revenue. The loss of this customer could have a material adverse impact on our results of operations in future periods.
Managing Industry Dynamics. We operate in the rapidly evolving digital advertising industry. Advances in programmatic advertising technologies, and the efficient and automated method of purchasing ads online, has enabled publishers to auction their ad inventory to more buyers simultaneously, in real time. As advertisers stay ahead of evolving trends in consumer engagement with digital media, an expansive opportunity for innovation emerges. Our commitment to understanding customer needs empowers us, and our continuous pursuit of innovation enables swift adaptation to industry shifts. This approach not only facilitates the development of cutting-edge solutions, but also does so in a cost-effective manner.
As regulatory concerns accelerate the impact on existing industry standards, companies are actively seeking new methods to finely tailor their messages to target audiences. Tech companies will be limited in how they monetize personal information for advertising purposes. This trend is exemplified by two imminent developments: (1) the anticipated erosion of Google's third-party cookies, and (2) the data security measures integrated into Apple iPhones. Consequently, companies must explore innovative methods to better understand their target audiences and have the tools to effectively engage with them.
35
Table of Contents
Key Operating and Financial Metrics
We monitor the following key financial and operational metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans, and make strategic decisions. The following is our analysis for the three and nine months ended September 30, 2025 and 2024:
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Revenue |
|
$ |
13,940 |
|
|
$ |
14,151 |
|
|
$ |
43,538 |
|
|
$ |
39,602 |
|
Cost of revenue |
|
|
9,686 |
|
|
|
9,764 |
|
|
|
31,975 |
|
|
|
28,656 |
|
Gross margin |
|
|
4,254 |
|
|
|
4,387 |
|
|
|
11,563 |
|
|
|
10,946 |
|
General and administrative expenses |
|
|
4,099 |
|
|
|
4,414 |
|
|
|
12,644 |
|
|
|
14,966 |
|
Financing and other expense, net |
|
|
(2,988 |
) |
|
|
(3,229 |
) |
|
|
(9,064 |
) |
|
|
(9,210 |
) |
Net loss |
|
$ |
(2,833 |
) |
|
$ |
(3,256 |
) |
|
$ |
(10,145 |
) |
|
$ |
(13,230 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Adjusted EBITDA (loss) (1) |
|
$ |
1,331 |
|
|
$ |
804 |
|
|
$ |
1,930 |
|
|
$ |
(1,274 |
) |
(1) For a reconciliation of net loss to Adjusted EBITDA see “Use of Non-GAAP Financial Measures” below.
Revenue
The Company generates revenue through:
Revenue decreased by $211,000, or 1%, for the three months ended September 30, 2025, compared to the same period in 2024. Revenue increased by $3.9 million, or 10%, for the nine months ended September 30, 2025, compared to the same period in 2024. See below for a detailed analysis of revenue for the three and nine months ended September 30, 2025, and 2024.
Cost of Revenue
Cost of revenue includes internal labor and payment to third parties for services performed to drive revenue, which includes the publisher cost paid for ad exchange on third party sites, advertising fees, personnel costs, technology and data related costs, fees paid for content creation, influencers, writers, and sales commission.
Cost of revenue decreased by $78,000, or 1%, for the three months ended September 30, 2025 compared to the same period in 2024. Cost of revenue increased by $3.3 million, or 12%, for the nine months ended September 30, 2025, compared to the same period in 2024. See below for a detailed analysis of cost of revenue for the three and nine months ended September 30, 2025, and 2024.
General and Administrative Expenses
General and administrative expenses consist primarily of (i) personnel and related costs for our executive, finance and accounting, human resources, and, administrative personnel, including salaries, benefits, bonuses, and stock-based compensation; (ii) legal, accounting, and other professional service fees; (iii) other corporate expenses; (iv) information technology costs; and (v) facility costs.
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Table of Contents
General and administrative expenses decreased by $315,000, or 7%, for the three months ended September 30, 2025 compared to the same period in 2024. General and administrative expenses decreased by $2.3 million, or 16%, for the nine months ended September 30, 2025, compared to the same period in 2024. See below for a detailed analysis of general and administrative expenses for the three and nine months ended September 30, 2025 and 2024.
Results of Operations
The following is our analysis of the results of operations for the periods indicated below. This analysis should be read in conjunction with the consolidated financial statements and the notes to those statements that are included elsewhere in this Quarterly Report on Form 10-Q.
Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024
Net loss for the quarter ended September 30, 2025 was $2.8 million as compared to a net loss of $3.3 million for the same period in 2024. The following is our analysis for the period:
|
|
Three Months Ended September 30, |
|
|
|
|
|
|
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
Change |
|
|||||||
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Revenue |
|
$ |
13,940 |
|
|
$ |
14,151 |
|
|
$ |
(211 |
) |
|
|
-1 |
% |
Cost of revenue |
|
|
9,686 |
|
|
|
9,764 |
|
|
|
(78 |
) |
|
|
-1 |
% |
Gross margin |
|
|
4,254 |
|
|
|
4,387 |
|
|
|
(133 |
) |
|
|
-3 |
% |
General and administrative expenses |
|
|
4,099 |
|
|
|
4,414 |
|
|
|
(315 |
) |
|
|
-7 |
% |
Income (loss) from operations |
|
|
155 |
|
|
|
(27 |
) |
|
|
182 |
|
|
|
-674 |
% |
Financing and other expense, net |
|
|
(2,988 |
) |
|
|
(3,229 |
) |
|
|
241 |
|
|
|
-7 |
% |
Net loss |
|
$ |
(2,833 |
) |
|
$ |
(3,256 |
) |
|
$ |
423 |
|
|
|
-13 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gross margin percentage |
|
|
31 |
% |
|
|
31 |
% |
|
|
|
|
|
0 |
% |
|
Revenue
Our revenue decreased by $211,000, or 1%, for the three months ended September 30, 2025, compared to the same period in 2024. The Company focuses on digital publishing, advertising technology, consumer insights, creative services, and media services. Changes in revenue generated by each such division are set forth below:
|
|
Three Months Ended September 30, |
|
|
|
|
|
|
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
Change |
|
|||||||
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Digital publishing |
|
$ |
280 |
|
|
$ |
519 |
|
|
$ |
(239 |
) |
|
|
-46 |
% |
Advertising technology |
|
|
5,073 |
|
|
|
4,661 |
|
|
|
412 |
|
|
|
9 |
% |
Consumer insights |
|
|
6,362 |
|
|
|
6,765 |
|
|
|
(403 |
) |
|
|
-6 |
% |
Creative services |
|
|
1,497 |
|
|
|
1,616 |
|
|
|
(119 |
) |
|
|
-7 |
% |
Media services |
|
|
728 |
|
|
|
590 |
|
|
|
138 |
|
|
|
23 |
% |
|
|
$ |
13,940 |
|
|
$ |
14,151 |
|
|
$ |
(211 |
) |
|
|
-1 |
% |
Digital Publishing
Digital publishing revenue decreased by $239,000, or 46%, for the three months ended September 30, 2025, compared to the same period in 2024. Approximately $280,000, or 2%, of the Company’s revenue for the three months ended September 30, 2025, was generated from our digital publishing customers, compared to $519,000, or 4%, for the same period in 2024. This division was significantly impacted by macroeconomic factors, which reduced traffic to our website, coupled with an overall reduction in spending by some customers related to inflationary concerns.
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Table of Contents
Advertising Technology
Advertising technology revenue increased by $412,000, or 9%, for the three months ended September 30, 2025, compared to the same period in 2024. Approximately $5.1 million, or 36%, of the Company’s revenue for the three months ended September 30, 2025, was generated from our advertising technology customers compared to $4.7 million, or 33%, for the same period in 2024. This growth was driven by our ability to leverage our resources to attract top advertisers, which in turn allowed us to onboard premium publishers. This led to an increase in volume, as well as rates and overall revenue.
Consumer Insights
Consumer insights revenue decreased by $403,000, or 6%, for the three months ended September 30, 2025, compared to the same period in 2024. Approximately $6.4 million, or 46%, of the Company’s revenue for the three months ended September 30, 2025 was generated from our consumer insights customers compared to $6.8 million, or 48%, for the same period in 2024.
Creative Services
Creative services revenue decreased by $119,000, or 7%, for the three months ended September 30, 2025, compared to the same period in 2024. Approximately $1.5 million, or 11%, of the Company’s revenue for the three months ended September 30, 2025, was generated from our creative services customers compared to $1.6 million, or 11% for the same period in 2024.
Media Services
Media services revenue increased by $138,000, or 23%, for the three months ended September 30, 2025, compared to the same period in 2024. Approximately $728,000, or 5%, of the Company’s revenue for the three months ended September 30, 2025, was generated from our media services customers compared to $590,000, or 4%, for the same period in 2024. This increase was primarily related to the timing of customer needs.
Cost of Revenue
|
|
Three Months Ended September 30, |
|
|
|
|
|
|
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
Change |
|
|||||||
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Direct salaries and labor costs |
|
$ |
1,546 |
|
|
$ |
1,541 |
|
|
$ |
5 |
|
|
|
0 |
% |
Direct project costs |
|
|
2,389 |
|
|
|
3,002 |
|
|
|
(613 |
) |
|
|
-20 |
% |
Non-direct project costs |
|
|
1,526 |
|
|
|
1,755 |
|
|
|
(229 |
) |
|
|
-13 |
% |
Publisher costs |
|
|
3,739 |
|
|
|
3,023 |
|
|
|
716 |
|
|
|
24 |
% |
Content creation |
|
|
147 |
|
|
|
174 |
|
|
|
(27 |
) |
|
|
-16 |
% |
Sales commissions |
|
|
239 |
|
|
|
309 |
|
|
|
(70 |
) |
|
|
-23 |
% |
Other |
|
|
100 |
|
|
|
(40 |
) |
|
|
140 |
|
|
|
-350 |
% |
|
|
$ |
9,686 |
|
|
$ |
9,764 |
|
|
$ |
(78 |
) |
|
|
-1 |
% |
Cost of revenue decreased by $78,000, or 1%, for the three months ended September 30, 2025, compared to the same period for 2024. This decrease is due to the factors discussed below:
Direct Salaries and Labor Cost
Direct salaries and labor cost remained consistent, with a slight increase of $5,000 for the three months ended September 30, 2025, when compared to the same period in 2024. Approximately $1.5 million, or 16%, of the Company's cost of revenue for the three months ended September 30, 2025, was a result of direct salaries and labor cost compared to $1.5 million, or 15%, for the same period in 2024. These costs represent salary and labor cost of employees that work directly on customer projects for our consumer insights, creative services, and media services divisions.
38
Table of Contents
Direct Project Cost
Direct project cost decreased by $613,000, or 20%, for the three months ended September 30, 2025 when compared to the same period in 2024. Approximately $2.4 million, or 25%, of the Company's cost of revenue for the three months ended September 30, 2025, was a result of direct project cost compared to $3.0 million, or 31%, during the same period in 2024. This decrease was consistent with the decrease in revenue from our consumer insights division. These costs include payments made to third-parties that are directly attributable to the completion of projects that allow for revenue recognition for our consumer insights, creative services, and media services divisions.
Non-Direct Project Cost
Non-direct project cost decreased by $229,000, or 13%, for the three months ended September 30, 2025 when compared to the same period in 2024. Approximately $1.5 million, or 16%, of the Company's cost of revenue for the three months ended September 30, 2025, was a result of non-direct project cost compared to $1.8 million, or 18%, for the same period in 2024. This decrease is related to our continued efforts to decrease headcount. These costs represent overall client service costs that are not specifically related to a particular project, but relate to services for our consumer insights, creative services, and media services divisions.
Publisher Cost
Publisher cost was $3.7 million, which represents 39% of overall cost of revenue, and $3.0 million, or 31%, of overall cost of revenue, for the three months ended September 30, 2025 and 2024, respectively. We experienced an increase of $716,000, or 24%, for the three months ended September 30, 2025, compared to the same period in 2024. In 2024, we ran political campaigns with margins better than our average. We did not run similar campaigns in 2025, and as a result, in 2025 our margins were lower. In 2025, we have had higher costs with publishers in connection with the revenue obtained from ad sales. These costs represent payments to media providers and website publishers.
Gross Margin
Gross margin was $4.3 million and $4.4 million for the three months ended September 30, 2025 and 2024, respectively. Our gross margin decreased by $133,000, or 3%, for the three months ended September 30, 2025, when compared to the same period of 2024. Gross margin as a percentage of revenue remained consistent at 31% for the three months ended September 30, 2025 and 2024.
General and Administrative Expenses
|
|
Three Months Ended September 30, |
|
|
|
|
|
|
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
Change |
|
|||||||
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Personnel costs |
|
$ |
1,650 |
|
|
$ |
1,920 |
|
|
$ |
(270 |
) |
|
|
-14 |
% |
Legal fees |
|
|
460 |
|
|
|
158 |
|
|
|
302 |
|
|
|
191 |
% |
Professional fees |
|
|
884 |
|
|
|
799 |
|
|
|
85 |
|
|
|
11 |
% |
Insurance |
|
|
130 |
|
|
|
193 |
|
|
|
(63 |
) |
|
|
-33 |
% |
Depreciation |
|
|
11 |
|
|
|
36 |
|
|
|
(25 |
) |
|
|
-69 |
% |
Amortization |
|
|
446 |
|
|
|
480 |
|
|
|
(34 |
) |
|
|
-7 |
% |
Website expenses |
|
|
198 |
|
|
|
351 |
|
|
|
(153 |
) |
|
|
-44 |
% |
Data processing |
|
|
170 |
|
|
|
262 |
|
|
|
(92 |
) |
|
|
-35 |
% |
Other |
|
|
150 |
|
|
|
215 |
|
|
|
(65 |
) |
|
|
-30 |
% |
|
|
$ |
4,099 |
|
|
$ |
4,414 |
|
|
$ |
(315 |
) |
|
|
-7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gross margin as a percentage of general and administrative expense |
|
|
104 |
% |
|
|
99 |
% |
|
|
|
|
|
5 |
% |
|
39
Table of Contents
General and administrative expenses decreased by $315,000, or 7%, for the three months ended September 30, 2025, compared to the same period in 2024. The decrease is due to a combination of factors as discussed below:
Personnel Cost
Personnel cost decreased by $270,000, or 14%, for the three months ended September 30, 2025, compared to the same period in 2024. This change was mainly driven by a decrease in the Company's head count by a net change of 28 employees. The Company employee's headcount was 113 and 141 at September 30, 2025 and 2024, respectively.
Legal Fees
Legal fees increased by $302,000, or 191%, for the three months ended September 30, 2025, compared to the same period in 2024. This increase was due largely to payments made as part of the ongoing litigation with Ladenburg. See Note 16, Commitments and Contingencies, to the consolidated financial statements.
Website Expenses
Website expenses decreased by $153,000, or 44%, for the three months ended September 30, 2025, compared to the same period in 2024. This decrease was related to a reclassification of certain components of software costs from website expenses to cost of revenue.
Financing Expense (Income)
|
|
Three Months Ended September 30, |
|
|
|
|
|
|
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
Change |
|
|||||||
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest expense |
|
$ |
3,040 |
|
|
$ |
3,261 |
|
|
$ |
(221 |
) |
|
|
-7 |
% |
Other expense (income) |
|
|
(52 |
) |
|
|
(31 |
) |
|
|
(21 |
) |
|
|
68 |
% |
Total financing and other expense, net |
|
$ |
2,988 |
|
|
$ |
3,230 |
|
|
$ |
(242 |
) |
|
|
-7 |
% |
Financing and other expense, net, decreased by $242,000, or 7%, for the three months ended September 30, 2025, compared to the same period in 2024. This decrease is related to a decrease in interest paid under the Centre Lane Senior Secured Credit Facility due to greater capitalization of interest in the current year. See Note 10, Centre Lane Senior Secured Credit Facility, to the consolidated financial statements.
Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024
Net loss for the nine months ended September 30, 2025 was $10.1 million as compared to a net loss of $13.2 million for the same period in 2024. The following is our analysis for the period:
|
|
Nine Months Ended September 30, |
|
|
|
|
|
|
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
Change |
|
|||||||
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Revenue |
|
$ |
43,538 |
|
|
$ |
39,602 |
|
|
$ |
3,936 |
|
|
|
10 |
% |
Cost of revenue |
|
|
31,975 |
|
|
|
28,656 |
|
|
|
3,319 |
|
|
|
12 |
% |
Gross margin |
|
|
11,563 |
|
|
|
10,946 |
|
|
|
617 |
|
|
|
6 |
% |
General and administrative expenses |
|
|
12,644 |
|
|
|
14,966 |
|
|
|
(2,322 |
) |
|
|
-16 |
% |
Loss from operations |
|
|
(1,081 |
) |
|
|
(4,020 |
) |
|
|
2,939 |
|
|
|
-73 |
% |
Financing and other expense, net |
|
|
(9,064 |
) |
|
|
(9,210 |
) |
|
|
146 |
|
|
|
-2 |
% |
Net loss |
|
$ |
(10,145 |
) |
|
$ |
(13,230 |
) |
|
$ |
3,085 |
|
|
|
-23 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gross margin percentage |
|
|
27 |
% |
|
|
28 |
% |
|
|
|
|
|
-1 |
% |
|
40
Table of Contents
Revenue
Our revenue increased by $3.9 million, or 10%, for the nine months ended September 30, 2025, compared to the same period in 2024. The increase in revenue was largely attributable to our advertising technology division. The Company focuses on digital publishing, advertising technology, consumer insights, creative services, and media services. Changes in revenue generated by each such division are set forth below:
|
|
Nine Months Ended September 30, |
|
|
|
|
|
|
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
Change |
|
|||||||
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Digital publishing |
|
$ |
1,222 |
|
|
$ |
1,468 |
|
|
$ |
(246 |
) |
|
|
-17 |
% |
Advertising technology |
|
|
14,420 |
|
|
|
10,874 |
|
|
|
3,546 |
|
|
|
33 |
% |
Consumer insights |
|
|
20,733 |
|
|
|
20,132 |
|
|
|
601 |
|
|
|
3 |
% |
Creative services |
|
|
4,725 |
|
|
|
5,332 |
|
|
|
(607 |
) |
|
|
-11 |
% |
Media services |
|
|
2,438 |
|
|
|
1,796 |
|
|
|
642 |
|
|
|
36 |
% |
|
|
$ |
43,538 |
|
|
$ |
39,602 |
|
|
$ |
3,936 |
|
|
|
10 |
% |
Digital Publishing
Digital publishing revenue decreased by $246,000, or 17%, for the nine months ended September 30, 2025, compared to the same period in 2024. Approximately $1.2 million, or 3%, of the Company’s revenue for the nine months ended September 30, 2025 was generated from our digital publishing customers, compared to $1.5 million, or 4%, for the same period in 2024.
Advertising Technology
Advertising technology revenue increased by $3.5 million, or 33%, for the nine months ended September 30, 2025, compared to the same period in 2024. Approximately $14.4 million, or 33%, of the Company’s revenue for the nine months ended September 30, 2025 was generated from our advertising technology customers compared to $10.9 million, or 28%, for the same period in 2024. This growth was driven by our ability to leverage our resources to attract top advertisers, which in turn has allowed us to onboard premium publishers. This led to an increase in volume, as well as rates and overall revenue.
Consumer Insights
Consumer insights revenue increased by $601,000, or 3%, for the nine months ended September 30, 2025, compared to the same period in 2024. Approximately $20.7 million, or 48%, of the Company’s revenue for the nine months ended September 30, 2025 was generated from our consumer insights customers compared to $20.1 million, or 51%, for the same period in 2024.
Creative Services
Creative services revenue decreased by $607,000, or 11%, for the nine months ended September 30, 2025, compared to the same period in 2024. Approximately $4.7 million, or 11%, of the Company’s revenue for the nine months ended September 30, 2025 was generated from our creative services customers compared to $5.3 million, or 13% for the same period in 2024. This decrease was primarily related to a decrease in the number of projects for smaller tier revenue customers.
Media Services
Media services revenue increased by $642,000, or 36%, for the nine months ended September 30, 2025, compared to the same period in 2024. Approximately $2.4 million, or 6%, of the Company’s revenue for the nine months ended September 30, 2025 was generated from our media services customers compared to $1.8 million, or 5%, for the same period in 2024. This increase was primarily related to the timing of customer needs and the moving of certain projects from year-end 2024 to the first three quarters of 2025.
41
Table of Contents
Cost of Revenue
|
|
Nine Months Ended September 30, |
|
|
|
|
|
|
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
Change |
|
|||||||
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Direct salaries and labor costs |
|
$ |
5,223 |
|
|
$ |
5,617 |
|
|
$ |
(394 |
) |
|
|
-7 |
% |
Direct project costs |
|
|
10,934 |
|
|
|
9,201 |
|
|
|
1,733 |
|
|
|
19 |
% |
Non-direct project costs |
|
|
3,678 |
|
|
|
5,459 |
|
|
|
(1,781 |
) |
|
|
-33 |
% |
Publisher costs |
|
|
10,464 |
|
|
|
7,121 |
|
|
|
3,343 |
|
|
|
47 |
% |
Content creation |
|
|
548 |
|
|
|
527 |
|
|
|
21 |
|
|
|
4 |
% |
Sales commissions |
|
|
814 |
|
|
|
656 |
|
|
|
158 |
|
|
|
24 |
% |
Other |
|
|
314 |
|
|
|
75 |
|
|
|
239 |
|
|
|
319 |
% |
|
|
$ |
31,975 |
|
|
$ |
28,656 |
|
|
$ |
3,319 |
|
|
|
12 |
% |
Cost of revenue increased by $3.3 million, or 12%, for the nine months ended September 30, 2025, compared to the same period for 2024. This increase is due to the factors discussed below:
Direct Salaries and Labor Cost
Direct salaries and labor cost decreased by $394,000, or 7%, for the nine months ended September 30, 2025, when compared to the same period in 2024. Approximately $5.2 million, or 16%, of the Company's cost of revenue for the nine months ended September 30, 2025 was a result of direct salaries and labor cost compared to $5.6 million, or 22% for the same period in 2024. These costs represent salary and labor cost of employees that work directly on customer projects for our consumer insights, creative services, and media services divisions.
Direct Project Cost
Direct project cost increased by $1.7 million, or 19%, for the nine months ended September 30, 2025, when compared to the same period in 2024. Approximately $10.9 million, or 34%, of the Company's cost of revenue for the nine months ended September 30, 2025 was a result of direct project cost compared to $9.2 million, or 32%, during the same period in 2024. This increase was related to an increase in customer contracts. These costs include payments made to third-parties that are directly attributable to the completion of projects that allow for revenue recognition for our consumer insights, creative services, and media services divisions.
Non-Direct Project Cost
Non-direct project cost was $3.7 million, or 12%, of the Company's cost of revenue for the nine months ended September 30, 2025, compared to $5.5 million, or 19%, for the same period in 2024. These costs represent overall client service costs that are not specifically related to a particular project, but relate to services for our consumer insights, creative services, and media services divisions. The decrease of $1.8 million is related to our continued efforts to decrease headcount.
Publisher Cost
Publisher cost was $10.5 million, which represents 33% of overall cost of revenue, and $7.1 million, or 25%, of overall cost of revenue, for the nine months ended September 30, 2025 and 2024, respectively. We experienced an increase of $3.3 million, or 47%, for the nine months ended September 30, 2025, compared to the same period in 2024. In 2024, we ran political campaigns with margins better than our average. We did not run similar campaigns in 2025, and as a result, in 2025 our margins were lower. In 2025, we have had higher costs with publishers in connection with the revenue obtained from ad sales. These costs represent payments to media providers and website publishers.
Gross Margin
Gross margin was $11.6 million and $10.9 million for the nine months ended September 30, 2025 and 2024, respectively. Our gross margin increased $617,000, or 6%, for the nine months ended September 30, 2025, when compared to the same period of 2024. Gross margin as a percentage of revenue decreased to 27% for the nine months ended September 30, 2025, compared to 28% for the same period of 2024 due to the higher cost of revenue.
42
Table of Contents
General and Administrative Expenses
|
|
Nine Months Ended September 30, |
|
|
|
|
|
|
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
Change |
|
|||||||
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Personnel costs |
|
$ |
5,298 |
|
|
$ |
6,797 |
|
|
$ |
(1,499 |
) |
|
|
-22 |
% |
Legal fees |
|
|
1,115 |
|
|
|
946 |
|
|
|
169 |
|
|
|
18 |
% |
Professional fees |
|
|
2,472 |
|
|
|
2,401 |
|
|
|
71 |
|
|
|
3 |
% |
Insurance |
|
|
392 |
|
|
|
607 |
|
|
|
(215 |
) |
|
|
-35 |
% |
Depreciation |
|
|
39 |
|
|
|
111 |
|
|
|
(72 |
) |
|
|
-65 |
% |
Amortization |
|
|
1,416 |
|
|
|
1,442 |
|
|
|
(26 |
) |
|
|
-2 |
% |
Website expenses |
|
|
675 |
|
|
|
1,027 |
|
|
|
(352 |
) |
|
|
-34 |
% |
Data processing |
|
|
615 |
|
|
|
972 |
|
|
|
(357 |
) |
|
|
-37 |
% |
Other |
|
|
622 |
|
|
|
663 |
|
|
|
(41 |
) |
|
|
-6 |
% |
|
|
$ |
12,644 |
|
|
$ |
14,966 |
|
|
$ |
(2,322 |
) |
|
|
-16 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gross margin as a percentage of general and administrative expense |
|
|
91 |
% |
|
|
73 |
% |
|
|
|
|
|
18 |
% |
|
General and administrative expenses decreased by $2.3 million, or 16%, for the nine months ended September 30, 2025, compared to the same period in 2024. The decrease is due to a combination of factors as discussed below:
Personnel Cost
Personnel cost decreased by $1.5 million, or 22%, for the nine months ended September 30, 2025, compared to the same period in 2024. This change was mainly driven by a decrease in the Company's head count by a net change of 28 employees. The Company employee's headcount was 113 and 141 at September 30, 2025 and 2024, respectively.
Insurance Cost
Insurance cost decreased by $215,000, or 35%, compared to the same period in 2024. This change was mainly driven by a reform of the Company's management liability insurance program, including changes to insurance providers, resulting in a decrease in premiums from the prior year.
Legal Fees
Legal fees increased by $169,000, or 18%, for the nine months ended September 30, 2025, compared to the same period in 2024. This increase was due largely to payments made as part of the ongoing litigation with Ladenburg. See Note 16, Commitments and Contingencies, to the consolidated financial statements.
Website Expenses
Website expenses decreased by $352,000, or 34%, for the nine months ended September 30, 2025, compared to the same period in 2024. This decrease was related to a reclassification of certain components of software costs from website expenses to cost of revenue.
Data Processing
Data processing decreased by $357,000, or 37%, for the nine months ended September 30, 2025, compared to the same period in 2024. This reduction was due largely to the reclassification of certain components of data processing costs from data processing to website expenses.
43
Table of Contents
Financing Expense (Income)
|
|
Nine Months Ended September 30, |
|
|
|
|
|
|
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
Change |
|
|||||||
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest expense |
|
$ |
9,207 |
|
|
$ |
9,638 |
|
|
$ |
(431 |
) |
|
|
-4 |
% |
Other expense (income) |
|
|
(143 |
) |
|
|
(428 |
) |
|
|
285 |
|
|
|
-67 |
% |
Total financing and other expense, net |
|
$ |
9,064 |
|
|
$ |
9,210 |
|
|
$ |
(146 |
) |
|
|
-2 |
% |
Financing and other expense, net, decreased by $146,000, or 2%, for the nine months ended September 30, 2025, compared to the same period in 2024. This decrease is related to a decrease in interest paid under the Centre Lane Senior Secured Credit Facility due to greater capitalization of interest in the current year. See Note 10, Centre Lane Senior Secured Credit Facility, to the consolidated financial statements.
Use of Non-GAAP Financial Measure
Non-GAAP results are presented only as a supplement to the financial statements and for use within management's discussion and analysis based on accounting principles generally accepted in the United States of America ("GAAP"). The non-GAAP financial information is provided to enhance the reader's understanding of the Company's financial performance, but non-GAAP measures should not be considered in isolation or as a substitute for financial measures calculated in accordance with GAAP.
All of the items included in the reconciliation from net loss before taxes to EBITDA and from EBITDA to Adjusted EBITDA are either (i) non-cash items (e.g., depreciation, amortization of purchased intangibles, stock-based compensation, etc.) or (ii) items that management does not consider to be useful in assessing the Company's ongoing operating performance (e.g., M&A costs, income taxes, gain on sale of investments, loss on disposal of assets, etc.). In the case of the non-cash items, management believes that investors can better assess the Company's operating performance if the measures are presented without such items because, unlike cash expenses, these adjustments do not affect the Company's ability to generate free cash flow or invest in its business.
We use, and we believe investors benefit from the presentation of, EBITDA and Adjusted EBITDA in evaluating our operating performance because it provides us and our investors with an additional tool to compare our operating performance on a consistent basis by removing the impact of certain items that management believes do not directly reflect our core operations. We believe that EBITDA is useful to investors and other external users of our financial statements in evaluating our operating performance because EBITDA is widely used by investors to measure a company's operating performance without regard to items such as interest expense, taxes, and depreciation and amortization, which can vary substantially from company to company depending upon accounting methods and book value of assets, capital structure and the method by which assets were acquired.
Because not all companies use identical calculations, the Company's presentation of non-GAAP financial measures may not be comparable to other similarly titled measures of other companies. However, these measures can still be useful in evaluating the Company's performance against its peer companies because management believes the measures provide users with valuable insight into key components of GAAP financial disclosures.
44
Table of Contents
A reconciliation of net loss before taxes to non-GAAP EBITDA and Adjusted EBITDA is as follows:
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net loss before tax |
|
$ |
(2,833 |
) |
|
$ |
(3,256 |
) |
|
$ |
(10,145 |
) |
|
$ |
(13,230 |
) |
Depreciation expense |
|
|
11 |
|
|
|
36 |
|
|
|
39 |
|
|
|
111 |
|
Amortization of intangibles |
|
|
446 |
|
|
|
480 |
|
|
|
1,416 |
|
|
|
1,442 |
|
Amortization of debt discount |
|
|
489 |
|
|
|
691 |
|
|
|
1,678 |
|
|
|
2,243 |
|
Other interest expense |
|
|
6 |
|
|
|
10 |
|
|
|
18 |
|
|
|
32 |
|
Interest expense - Centre Lane Senior Secured Credit Facility and Convertible Promissory Notes |
|
|
2,545 |
|
|
|
2,559 |
|
|
|
7,511 |
|
|
|
7,364 |
|
EBITDA (loss) |
|
|
664 |
|
|
|
520 |
|
|
|
517 |
|
|
|
(2,038 |
) |
Stock compensation expense |
|
|
27 |
|
|
|
57 |
|
|
|
98 |
|
|
|
191 |
|
Non-recurring professional fees |
|
|
111 |
|
|
|
167 |
|
|
|
372 |
|
|
|
167 |
|
Non-recurring legal fees |
|
|
516 |
|
|
|
60 |
|
|
|
873 |
|
|
|
313 |
|
Non-recurring severance expense |
|
|
13 |
|
|
|
- |
|
|
|
70 |
|
|
|
93 |
|
Adjusted EBITDA (loss) |
|
$ |
1,331 |
|
|
$ |
804 |
|
|
$ |
1,930 |
|
|
$ |
(1,274 |
) |
Liquidity and Capital Resources
Liquidity is the ability of a company to generate sufficient cash to satisfy its needs for cash. The following table summarizes total current assets, total current liabilities, and net working capital (deficit) as of September 30, 2025, as compared to December 31, 2024.
|
|
September 30, 2025 |
|
|
December 31, 2024 |
|
||
(in thousands) |
|
|
|
|
|
|
||
Total current assets |
|
$ |
17,428 |
|
|
$ |
20,299 |
|
Total current liabilities |
|
|
34,712 |
|
|
|
33,780 |
|
Net working capital (deficit) |
|
$ |
(17,284 |
) |
|
$ |
(13,481 |
) |
As of September 30, 2025, we had a cash balance of $553,000 and a restricted cash balance of $1.9 million compared with a cash balance of $2.5 million and a restricted cash balance of $1.9 million as of December 31, 2024. The Company’s liquidity needs, and a discussion of how it intends to meet those needs, is discussed below. See – “Going Concern.”
Going Concern
Historically, the Company has incurred losses, which have resulted in an accumulated deficit of approximately $177.0 million as of September 30, 2025. Cash flows provided by (used in) operating activities were $347,000 and $(451,000) for the nine months ended September 30, 2025 and 2024, respectively. As of September 30, 2025, the Company had a working capital deficit of approximately $17.3 million, inclusive of $553,000 in cash and cash equivalents and $1.9 million in restricted cash.
The Company's current cash and working capital, as of the filing of this Quarterly Report on Form 10-Q, are not expected to be sufficient to fund its anticipated level of operations over the next twelve months. As a result, such matters create a substantial doubt regarding the Company’s ability to meet its financial obligations and continue as a going concern. The Company’s ability to continue as a going concern is dependent upon its ability to meet its liquidity needs through a combination of factors. During the next year, we anticipate that we will need approximately $5.2 million to meet our contractual obligations in addition to amounts needed for our working capital needs. The Company is currently exploring several strategic alternatives, including restructuring or refinancing its debt, or seeking additional debt, including borrowing under the Centre Lane Senior Secured Credit Facility, or raising equity capital. The ability to access the capital markets depends, in part, upon the volume and market price of the Company's stock, which cannot be assured. Other measures include reducing or delaying certain business activities, and reducing general and administrative expenses, including a reduction in headcount. The ultimate success of these plans is not guaranteed.
The accompanying unaudited consolidated financial statements are prepared on a going concern basis and do not include any adjustments that might result from uncertainty about the Company’s ability to continue as a going concern.
45
Table of Contents
Financing Arrangement Summary
Centre Lane Senior Secured Credit Facility
On June 5, 2020, the Company and its subsidiaries entered into the Amended and Restated Senior Secured Credit Facility between themselves, the lenders party thereto and Centre Lane Partners Master Credit Fund II, L.P., as Administrative Agent and Collateral Agent (“Centre Lane Partners”), as amended (the “Credit Agreement”). The Credit Agreement has been amended numerous times to change the terms, including the amounts outstanding, the interest rate, the maturity date and other payment terms.
As of September 30, 2025, Centre Lane Partners has loaned the Company $39.9 million through Amendments One through Eight (the "Second Out Loans"), Amendments Nine through Sixteen (the "First Out Loans"), and Amendments Seventeen and Twenty-One (the "Third Out Loans").
Effective March 31, 2025, the Company, the Lenders, and Centre Lane Partners entered into the Twenty-Second Amendment to the Credit Agreement, pursuant to which the following adjustments were made to the outstanding loans:
Effective September 30, 2025, the Company, the Lenders, and Centre Lane Partners entered into the Twenty-Third Amendment to the Credit Agreement, which applied the following adjustments to loans with outstanding payments due on September 30, 2025, including the following temporary modifications:
The outstanding principal owed to Centre Lane Partners was $83.6 million and $78.8 million as of September 30, 2025 and December 31, 2024, respectively. Of the amount outstanding at September 30, 2025, approximately $5.1 million is due by September 30, 2026, with $975,000 due at December 31, 2025, and $1.4 million due at each of March 31, June 30, and September 30, 2026. The balance of $78.5 million is due in December 2026.
For a full description of the Centre Lane Senior Secured Credit Facility, see Note 10, Centre Lane Senior Secured Credit Facility, to the consolidated financial statements.
46
Table of Contents
Summary of Cash Flows
The following table summarizes cash flow activities during the nine months ended September 30, 2025 and 2024:
|
|
Nine Months Ended September 30, |
|
|||||
(in thousands) |
|
2025 |
|
|
2024 |
|
||
Cash flow provided by (used in) operating activities |
|
$ |
347 |
|
|
$ |
(451 |
) |
Cash flow used in investing activities |
|
|
(30 |
) |
|
|
(100 |
) |
Cash flow used in financing activities |
|
|
(2,307 |
) |
|
|
(971 |
) |
Net decrease in cash and cash equivalents, net of impact of exchange rates |
|
$ |
(1,993 |
) |
|
$ |
(1,515 |
) |
47
Table of Contents
Operating Activities
Our largest source of operating cash is cash collections from customers from revenue. Our primary uses of our operating cash, are for cost of revenue expenses, personnel-related expenditures and other general administrative expenses.
For the nine months ended September 30, 2025, cash provided by operating activities was $347,000 The primary factors affecting our operating cash flows during the period were our net loss of $10.1 million, adjusted for non-cash charges of $1.4 million for amortization of intangible assets, $1.7 million of amortization of debt discount, $7.0 million in interest paid in kind on the Centre Lane Senior Secured Credit Facility, and a $4,000 net change in operating assets and liabilities. The primary drivers of the changes in operating assets and liabilities were a $2.4 million increase in deferred revenue and a $706,000 decrease in accounts receivable, partially offset by a $1.6 million decrease in accounts payable and accrued expenses and a $1.5 million decrease in other liabilities.
For the nine months ended September 30, 2024, cash used in operating activities was $451,000. The primary factors affecting our operating cash flows during the period were our net loss of $13.2 million, adjusted for non-cash charges of $1.4 million for amortization of intangible assets, $2.2 million of amortization of debt discount, $6.9 million in interest paid in kind on the Centre Lane Senior Secured Credit Facility, $191,000 for stock compensation expense, and a $1.8 million net change in operating assets and liabilities. The primary drivers of the changes in operating assets and liabilities were a $2.3 million increase in accounts receivable, a $543,000 decrease in accounts payable, and a $363,000 decrease in other liabilities, partially offset by a $200,000 increase in deferred revenue.
Investing Activities
Cash used in investing activities of $30,000 and $100,000 for the nine months ended September 30, 2025 and 2024, respectively, was attributable to $30,000 and $14,000, respectively, for the purchase of property and equipment, and $86,000 for website enhancements during the nine months ended September 30, 2024.
Financing Activities
During the nine months ended September 30, 2025, the Company used cash of $2.3 million in financing activities, which is largely attributable to the repayment of principal on the Centre Lane Senior Secured Credit Facility of $2.3 million.
During the nine months ended September 30, 2024, the Company used cash of $971,000 in financing activities, which is largely attributable to repayment of principal on the Centre Lane Senior Secured Credit Facility of $879,000.
Contractual Obligations and Commitments
There were no other material changes in our contractual obligations and commitments from those disclosed above in Note 10, Centre Lane Senior Secured Credit Facility, and Note 12, Leases, to the consolidated financial statements, and in the Annual Report on Form 10-K for the year ended December 31, 2024.
Off-Balance Sheet Arrangements
As of September 30, 2025 and December 31, 2024, there were no off-balance sheet arrangements between us and any other entity that have, or are reasonably likely to have, a current or future effect on our financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to shareholders.
Critical Accounting Policies and Estimates
The preparation of financial statements in conformity with GAAP requires management to make certain estimates, judgments, and assumptions. We believe that the estimates, judgments, and assumptions upon which we rely are reasonable based upon information available to us at the time that these estimates, judgments, and assumptions are made. These estimates, judgments, and assumptions can affect the reported amounts of assets and liabilities as of the date of our unaudited consolidated financial statements as well as reported amounts of revenue and expenses during the periods presented. Our unaudited consolidated financial statements would be affected to the extent there are material differences between these estimates and actual results. In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require management’s judgment in its application. There are also areas in which management’s judgment in selecting any available alternative would not produce a materially different result.
48
Table of Contents
Significant estimates included in the accompanying consolidated financial statements include, valuation of goodwill and intangible assets, allowance for current expected credit losses, the determination of the relative selling prices of our services, percentage of completion for revenue recognition, estimates of amortization period for intangible assets, estimates of depreciation period for property and equipment, discount rates used in the valuation of right-of-use assets and lease liabilities, litigation reserves, the valuation of equity-based transactions, the valuation of the Centre Lane Senior Secured Facility to determine whether a debt modification or extinguishment has occurred, and the valuation allowance on deferred tax assets.
Critical accounting policies are those policies that management believes are very important to the portrayal of our financial position and results of operations, and that require management to make estimates that are difficult, subjective or otherwise complex. For further information on all of our significant accounting policies, see the Company’s audited consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.
Recent Accounting Pronouncements
Recent accounting pronouncements are detailed in the “Summary of Significant Accounting Policies” in Note 2 to our unaudited consolidated financial statements.
Smaller Reporting Company Status
We are a “smaller reporting company” as defined in the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We may continue to be a smaller reporting company even though we are no longer an emerging growth company. We may take advantage of certain of the scaled disclosures available to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as the market value of our voting and non-voting common stock held by non-affiliates is less than $250.0 million measured on the last business day of our second fiscal quarter, or our annual revenue is less than $100.0 million during the most recently completed fiscal year and the market value of our voting and non-voting common stock held by non-affiliates is less than $700.0 million measured on the last business day of our second fiscal quarter.
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Item 3. Quantitative and Qualitative Disclosures About Market Risk.
As a smaller reporting company as defined in Rule 12b-2 of the Exchange Act, we are not required to include information otherwise required by this Item 3 to Form 10-Q.
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
The purpose of disclosure controls is to provide assurance at a reasonable level that the information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. The Company’s management, with the participation of the Company’s Chief Executive Officer (its principal executive officer) and Chief Financial Officer (its principal financial officer), have evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of September 30, 2025. Based on that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that as of September 30, 2025, our disclosure controls and procedures were effective.
Our senior management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rules 13a-15(f) and 15d-15(f) promulgated under the Exchange Act as a process designed by, or under the supervision of, our principal executive and principal financial officers, or persons performing similar functions, and effected by our Board, senior management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. GAAP.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. We continue to review our internal control over financial reporting and may from time to time make changes aimed at enhancing their effectiveness and to ensure that our systems evolve with our business.
Under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in “Internal Control — Integrated Framework (2013)” issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO").
As the Company continues to improve its accounting staff and processes, internal controls are at the forefront of our efforts to produce accurate and complete financial statements. The Company has provided standard operating procedures to ensure each process is both functioning and performed correctly. This allows for documented updates and improvements. The implementation of the month end close software also elevated our internal controls and documentation. Management does recognize that without updated systems, the manual processes will allow for possible material weaknesses in the future.
Notwithstanding the significant deficiencies described below, based on the Company's continued improvements in its accounting staff and processes described above, the Company's Chief Executive Officer and Chief Financial Officer evaluated our internal controls and concluded that as of September 30, 2025, they were effective, and that our consolidated financial statements included in this Quarterly Report on Form 10-Q fairly represent, in all material respects, our financial condition and results of operations as of and for the quarter ended September 30, 2025.
Outlined below are the significant deficiencies identified by management, along with the remedial actions planned.
Significant Deficiency
A significant deficiency or a combination of deficiencies in internal control over financial reporting is less severe than a material weakness, yet important enough to merit attention by those responsible for oversight of the Company’s financial reporting. The presence of such a deficiency does not mean that a material misstatement has occurred, but it indicates the possibility of such an occurrence in the future.
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As the Company continues to update and integrate its accounting and project systems, we have identified deficiencies in our overall internal controls, specifically as identified below:
To address these weaknesses, the Company has initiated a remediation plan comprising the following measures, including continued progress in the third quarter of 2025:
We will continue to monitor and evaluate the effectiveness of our internal controls over financial reporting on an ongoing basis and are committed to taking further action and implementing additional enhancements or improvements, as necessary.
Changes in Internal Control over Financial Reporting
Other than the matters set forth above, there were no changes in our internal control over financial reporting identified in management’s evaluation pursuant to Rules 13a-15(d) or 15d-15(d) of the Exchange Act during the quarter ended September 30, 2025 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II – OTHER INFORMATION
Item 1. Legal Proceedings.
From time to time, we may become involved in legal proceedings and claims arising in the ordinary course of business, including but not limited to, disputes in the areas of contracts, data protection, content regulation, intellectual property, consumer protection, e-commerce, marketing, advertising, rights of publicity, health and safety, employment and labor, competition, and taxation. We record a liability when we believe that it is probable that we will incur a loss, and the amount of that loss can be reasonably estimated.
Ladenburg
On July 11, 2023, Ladenburg Thalmann & Co. Inc. (“Ladenburg”) filed an action against the Company for breach of contract in the United States District Court for the Southern District of Florida (the “District Court”), Case No. 9:23-cv-81019-AMC. Ladenburg alleges that it entered into an Investment Banking Agreement (the “Agreement”) with the Company on September 1, 2020. According to Ladenburg, that Agreement provided that Ladenburg would be the exclusive investment advisor and banker for the Company. Ladenburg alleges that the Agreement entitles them to a fee for any financing transactions (debt financing or merger and acquisition transactions) that the Company engages in during the term of the contract. In April 2023, the Company informed Ladenburg of the impending acquisition of Big Village Insights, Inc. and Big Village Agency, LLC (together, the "Big Village Acquisition"). Ladenburg now seeks $1.5 million, plus interest, costs and attorneys’ fees and expenses as a result of that acquisition and debt financing, claiming that it is entitled to a fee. The Company disputes the allegations and disputes that Ladenburg is entitled to receive any fee since it did not perform any work pertaining to such acquisition. On November 27, 2024, the District Court entered a judgment in favor of Ladenburg and against the Company granting damages of $1.7 million to Ladenburg. On December 26, 2024, the Company filed a motion with the District Court requesting that the District Court reconsider its judgment. This motion was denied on January 30, 2025. Also on December 26, 2024, the Company and its subsidiaries entered into the Twenty-First Amendment to the Credit Agreement with Centre Lane Partners for the purpose of securing a bond to stay execution of the judgment. See Note 10, Centre Lane Senior Secured Credit Facility, to the consolidated financial statements. The Company obtained the bond and a stay of execution of the judgment was granted on February 3, 2025. On May 9, 2025, the Company appealed to the United States Court of Appeals for the Eleventh Circuit. Ladenburg filed a response on July 9, 2025, and the Company accrued an additional $242,000 to cover fees related to this matter. The Company replied to Ladenburg's response on August 29, 2025. The matter is now fully briefed for the appellate court. The outcome of this matter is not determinable as of the date of issuance of these consolidated financial statements.
Other Litigation
Other litigation is defined as smaller claims or litigation that are neither individually nor collectively material. It does not include lawsuits that relate to collections.
The Company is party to various other legal proceedings that arise in the ordinary course of business, separate from normal course accounts receivable collections matters. Due to the inherent difficulty of predicting the outcome of these other legal proceedings, the Company cannot predict the eventual outcome of these matters, and it is reasonably possible that some of them could be resolved unfavorably to the Company. As a result, it is possible that the Company’s results of operations or cash flows in a particular fiscal period could be materially affected by an unfavorable resolution of pending litigation or contingencies.
Item 1A. Risk Factors.
For the period ended September 30, 2025, one customer represented 15.0% of our total accounts receivable balance and another customer represented 10.9% of that balance. Inability to collect these amounts could have a material adverse impact on our operations.
Beyond this, there have been no other material changes to the Risk Factors previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
In connection with the Twenty-Third Amendment to Amended and Restated Senior Secured Credit Agreement by and among the Company, its subsidiaries, Centre Lane Partners Master Credit Fund II, L.P. (“Centre Lane Partners”), and the lenders thereto, and as consideration therefor, the Company agreed to issue 2,832,485 shares of the common stock of the Company, par value $0.01 per share, to Centre Lane Partners. The issuance of these securities was effected without registration in reliance on Section 4(a)(2) of the Securities Act as a sale by the Company not involving a public offering. No underwriters were involved with the issuance of such securities.
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Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
None.
Item 5. Other Information.
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Item 6. Exhibits.
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Incorporated by Reference |
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Filed or Furnished |
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No. |
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Exhibit Description |
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Date Filed |
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Herewith |
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10.1 |
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Twenty-Third Amendment to Amended and Restated Senior Secured Credit Agreement, dated September 30, 2025 |
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X |
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31.1 |
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Certification of the Principal Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) |
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X |
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31.2 |
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Certification of the Principal Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) |
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X |
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32.1* |
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Certification of the Principal Executive Officer pursuant to Section 1350 |
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X |
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32.2* |
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Certification of the Principal Financial Officer pursuant to Section 1350 |
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X |
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101.INS |
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Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document |
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101.SCH |
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Inline XBRL Taxonomy Extension Schema with Embedded Linkbase Documents |
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X |
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104. |
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Cover Page Interactive Data File (embedded within the Inline XBRL document) |
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X |
* This certification is being furnished and shall not be deemed “filed” with the SEC for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, and shall not be deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act, except to the extent that the Registrant specifically incorporates it by reference.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
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BRIGHT MOUNTAIN MEDIA, INC. |
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November 7, 2025 |
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By: |
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/s/ Matthew Drinkwater |
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Matthew Drinkwater, |
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Interim Chairman of the Board and Chief Executive Officer |
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(Principal Executive Officer) |
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/s/ Ethan Rudin |
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Ethan Rudin, |
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Chief Financial Officer |
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(Principal Financial and Accounting Officer) |
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FAQ
What was BMTM’s Q3 2025 revenue and net loss?
How did year-to-date results trend for BMTM in 2025?
What is BMTM’s liquidity position?
Did BMTM raise going concern issues?
How much debt does BMTM have with Centre Lane?
Were debt terms changed in 2025?
What were shares outstanding?
