Business context and reporting period
The supplied filing is Verb Technology Company, Inc.’s Form 10-K for the fiscal year ended December 31, 2023—not a TON Strategy Co. filing and not a standalone fourth-quarter report. The filing does not provide a clear standalone Q4 financial-results breakdown.
Verb sold its operating SaaS assets on June 13, 2023, and is now focused on MARKET.live, a livestream social-shopping platform. The sale consideration was $6.5 million, including $4.75 million received at closing; up to $1.75 million is contingent on specified future targets. The SaaS business is reported as discontinued operations.
Financial performance and liquidity
| Metric | FY 2023 | FY 2022 |
|---|---|---|
| Revenue from continuing operations | $63,000 | $8,000 |
| Operating loss from continuing operations | $13.795 million | $18.874 million |
| Net loss from continuing operations | $14.844 million | $15.958 million |
| Loss from discontinued operations | $7.150 million | $21.479 million |
| Net loss | $21.994 million | $37.437 million |
| Cash used in operating activities, continuing operations | $8.742 million | $13.683 million |
| Cash at year-end | $4.353 million | $2.429 million |
| Total assets / total liabilities | $10.839 million / $7.714 million | $24.492 million / $19.326 million |
Revenue from continuing operations remained minimal, so conventional revenue-margin comparisons are not especially informative. At year-end, current assets were $4.684 million versus current liabilities of $7.188 million. The balance sheet reported stockholders’ equity of $3.125 million.
Management’s non-GAAP Modified EBITDA loss was $8.376 million, compared with a loss of $12.383 million in 2022. This measure excludes, among other items, share-based compensation, financing costs and discontinued operations.
Notes payable were reported at a net carrying amount of $2.149 million at December 31, 2023, including $1.787 million current and $362,000 non-current. The filing separately describes approximately $2.9 million of outstanding notes in its risk discussion; the difference in presentation is not clearly reconciled in the provided text. The November Notes were subsequently paid in full on March 18, 2024. As of March 28, 2024, the Company reported approximately $14.2 million cash and $1.2 million of notes payable.
Material changes and financing
- Continuing-operation G&A fell 35% to $11.508 million, primarily due to lower personnel costs. Depreciation and amortization rose to $2.331 million from $1.108 million, largely reflecting a full year of software amortization.
- Cash used by continuing operations improved by approximately $4.9 million. The SaaS asset sale provided $4.75 million of investing cash proceeds.
- The Company raised $3.0 million from non-convertible Series C preferred stock in December 2023. It carries a stated 10% annual return, has no voting rights, and a stated face value of $1,300 per share.
- Subsequent financing included ATM share sales and a Regulation A offering of 27,397,258 common shares at $0.24 per share for $6.575 million gross proceeds. The filing reports different post-year-end ATM share and proceeds figures in different sections; investors should verify the final amounts.
- Common shares outstanding were 79,300,788 as of March 28, 2024. The company also reported issuing substantial common stock to reduce debt, including 11,484,403 shares exchanged for a $1.720 million reduction of the November Notes after year-end.
Outlook, risks and unusual items
Management said that financing raised after year-end, together with lower operating costs, had alleviated substantial doubt about the Company’s ability to continue as a going concern. As of March 28, 2024, management estimated available funding for at least 14 months, possibly longer depending on revenue generation. This is not a quantified revenue or earnings forecast. The audited statements nevertheless disclose substantial doubt based on year-end losses, operating cash use and $4.353 million of cash.
MARKET.live’s planned revenue sources include platform fees generally ranging from 10% to 20% of gross sales, with an average near 15%, event-production services, subscriptions and services for TikTok-referred clients, creator and drop-ship programs, and advertising. A formal TikTok Shop partnership was announced March 27, 2024, after the reporting period; expected fees and performance-based compensation are prospective, not 2023 results.
- Nasdaq notified the Company in November 2023 that it failed the $1.00 minimum bid-price requirement, with a compliance deadline before April 30, 2024. The Company had separately reported regaining compliance with the stockholders’ equity requirement in February 2024.
- The Company recorded $1.239 million of financing costs, including charges associated with missed payments under the November Notes. The sale of the SaaS assets also resulted in a $5.441 million impairment recorded in discontinued operations.
- A former employee obtained a $584,000 judgment, including interest; the Company accrued the liability and appealed. A separate legal-malpractice dispute was settled for $100, with $31,000 unpaid and accrued at year-end. The Iroquois warrant dispute was settled through issuance of shares and cancellation of warrants.
- The auditor identified valuation of $4.0 million of net capitalized software development costs as a critical audit matter. The auditor issued an unqualified opinion on the 2023 financial statements; it was not engaged to audit internal-control effectiveness. Management reported effective disclosure controls and internal control over financial reporting.
Most important facts for investors to verify
- Confirm the issuer and ticker: this filing identifies Verb Technology Company, Inc. (VERB), not TON Strategy Co.
- Review the latest cash balance, cash burn and management’s funding-duration assumptions; the 14-month estimate depends partly on future revenue.
- Reconcile the filing’s differing post-year-end ATM issuance and proceeds disclosures, and assess dilution from ATM sales, the Regulation A offering, debt-for-share exchanges and equity awards.
- Check Nasdaq bid-price compliance status and any subsequent listing notices or remedies.
- Assess MARKET.live adoption, monetized sales, TikTok partnership economics and the contingent SaaS-sale earnout; the filing does not demonstrate material platform revenue in 2023.
- Review the Series C preferred-stock dividend and redemption terms, remaining debt obligations, the appealed $584,000 judgment, and the assumptions supporting the carrying value of capitalized software.