Kidpik (PIK) investor relations material

Executive summary

• Revenue for Q3 2024 declined 69.2% year-over-year to $1.0M, driven by reduced subscription box sales and lower marketing spend.

• Net loss narrowed to $0.89M for Q3 2024 from $1.93M in Q3 2023, reflecting significant cost reductions.

• The company is pursuing a merger with Nina Footwear, expected to close in Q1 2025, which will result in significant dilution for current shareholders.

• Ongoing liquidity challenges and a working capital deficit raise substantial doubt about the company's ability to continue as a going concern.

• Marketing spend and new inventory purchases have been halted to preserve cash ahead of the merger.

Financial highlights

• Q3 2024 revenue: $1.0M, down from $3.4M in Q3 2023; 9M 2024 revenue: $4.4M, down from $10.9M year-over-year.

• Gross margin for Q3 2024 was 68.6% (54.3% excluding prior inventory write-down), up from 61.1% in Q3 2023.

• Net loss for Q3 2024: $0.89M vs. $1.93M in Q3 2023; 9M 2024 net loss: $4.0M vs. $5.9M year-over-year.

• Operating expenses for Q3 2024 decreased 61.4% year-over-year to $1.5M; operating loss was $819.9K.

• Cash and restricted cash at quarter-end: $7.8K; working capital deficit: $2.8M; accumulated deficit: $55.4M.

Outlook and guidance

• The company is not purchasing new inventory and is focused on selling existing stock to manage cash flow.

• Management expects continued net losses and negative cash flow until the merger is completed and/or new financing is secured.

• The merger with Nina Footwear is anticipated to strengthen the balance sheet and support Nasdaq compliance if closed.

• No earnings call will be held as focus remains on merger completion.