10-Q: Leafbuyer Technologies Reports Net Income for Q3 2025, Revenue Up 23%

Leafbuyer Technologies, Inc. reports a net income of $319,456 for the nine months ended March 31, 2025, a significant turnaround from the previous year's net loss, driven by increased revenue from text services.

Summary

• Leafbuyer Technologies, Inc. reported financial results for the quarter and nine months ended March 31, 2025.
• The company's revenue for the nine months ended March 31, 2025, was $5.0 million, compared to $4.1 million for the same period in 2024, representing a 23% increase.
• The increase in revenue was primarily due to additional text services.
• Gross profit for the nine months ended March 31, 2025, increased to $2.3 million from $1.4 million in the prior year.
• Total operating expenses decreased to $1.9 million for the nine months ended March 31, 2025, compared to $2.1 million for the same period in 2024.
• The company reported a net income of $319,456 for the nine months ended March 31, 2025, compared to a net loss of $790,260 for the same period in 2024.
• As of March 31, 2025, the company had $595,205 in cash and cash equivalents and a working capital deficit of $1,082,264.
• The company's ability to continue as a going concern is dependent on generating profitable operations and/or obtaining necessary financing.
• Management intends to finance operating costs over the next twelve months with existing cash and/or private placement of common stock or obtaining debt financing.

Sentiment

Score: 7

Explanation: The document shows a positive trend with increased revenue and a shift to net income, but concerns about going concern and working capital deficit temper the overall sentiment.

Positives

• The company achieved net income of $235,154 for the three months ended March 31, 2025, compared to a net loss of $171,649 for the three months ended March 31, 2024.
• Revenue increased by 16% to $1.7 million for the three months ended March 31, 2025.
• Gross profit increased by 44% to $810,869 for the three months ended March 31, 2025.
• Operating expenses decreased by 20% for the three months ended March 31, 2025.
• The company's gross profit increased due to increased revenue earned through additional text services with minimal 3rd party costs.

Negatives

• The company has a working capital deficit of $1,082,264 as of March 31, 2025.
• The company is dependent on funds raised through equity financing.
• There is substantial doubt about the company's ability to continue as a going concern within one year after the date the financial statements are issued.
• The company has an accumulated deficit of $24,823,658 as of March 31, 2025.

Risks

• The company's ability to continue as a going concern is dependent on generating profitable operations and/or obtaining necessary financing.
• The company operates in a rapidly evolving and highly regulated industry.
• The company may need to look for acquisitions for a sizable portion of growth, but there is no assurance that they will be able to locate and acquire such opportunities or that they will be on terms that are favorable.
• The company has a tax contingency related to stock options granted below the fair market value on date of grant.

Future Outlook

Management intends to finance operating costs over the next twelve months from the date of the issuance of these unaudited condensed financial statements with existing cash on hand and/or the private placement of common stock or obtaining debt financing.

Management Comments

• Our company has evolved and grown from a listing website to a comprehensive marketing technology platform.
• We plan to grow organically through the aggressive deployment of sales and marketing resources into legal cannabis states.
• We understand that to obtain a significant market share we may need to look for acquisitions for a sizable portion of that growth.

Industry Context

Leafbuyer operates in the rapidly evolving and highly regulated cannabis industry, which is estimated to exceed $70 billion in revenue by 2028.

Comparison to Industry Standards

• It is difficult to compare Leafbuyer directly to industry standards due to its unique business model as a marketing technology platform for the cannabis industry.
• However, companies like Weedmaps and Leafly operate in similar spaces, providing online resources for cannabis consumers.
• These companies have achieved significant valuations, indicating the potential for growth in this market.
• Leafbuyer's focus on texting/loyalty programs and customizable white-label applications differentiates it from some competitors.

Legal Proceedings

• To the best of the Company's knowledge and belief, no legal proceedings of merit are currently pending or threatened against the Company.

Related Party Transactions

• The Company had notes payable to related parties, including the Chief Executive Officer and Chief Technology Officer.
• These notes were related to loans issued in March 2020, April 2020, and March 2024.
• The outstanding loan amounts were paid in full on September 17, 2024.

Stakeholder Impact

• The company's improved financial performance could positively impact shareholders.
• The company's expansion plans could create opportunities for employees.
• The company's technology platform benefits cannabis dispensaries and product companies by assisting in customer acquisition and retention.
• The company's services ultimately benefit cannabis consumers by providing access to deals and specials.

Next Steps

• The company plans to continue an aggressive push into all legal cannabis states.
• The company plans to continue to develop innovative technologies that will serve cannabis dispensaries and product companies in attracting and retaining consumers.
• Management intends to finance operating costs over the next twelve months with existing cash on hand and/or the private placement of common stock or obtaining debt financing.

Key Dates

Keywords

revenue, net income, cannabis, technology platform, text services, financial results, Leafbuyer Technologies, EIDL Loan, going concern