Gifty (GIFT) Q3 2024 earnings summary

Executive summary

• Completed acquisition of CardCash Exchange Inc. on December 29, 2023, expanding into the gift card exchange market and integrating operations with Restaurant.com.

• Listed on Nasdaq as of August 6, 2024, and changed corporate name to Giftify, Inc. effective October 28, 2024.

• Operates two principal divisions: B2C and B2B, with CardCash focusing on gift card exchanges and Restaurant.com on restaurant deals.

Financial highlights

• Net sales for Q3 2024 were $23.2M, up 14.9% year-over-year; nine-month sales were $64.8M, down 1.1% year-over-year.

• Gross margin improved to 12.9% in Q3 2024 (vs. 12.8% prior year) and 14.7% for the nine months (vs. 12.4%).

• Net loss for Q3 2024 was $4.1M (vs. $0.6M prior year); nine-month net loss was $15.0M (vs. $1.7M prior year).

• Modified EBITDA for Q3 2024 was $(0.7)M, and for the nine months was $(1.7)M.

• Stock-based compensation expense increased significantly, totaling $9.8M for the nine months.

Outlook and guidance

• Management expects selling, general, and administrative expenses to rise as public company costs increase.

• Focus remains on improving gross margin and leveraging cross-promotional opportunities.

• Substantial doubt exists about the ability to continue as a going concern without additional financing.