Bridgeline Digital, Inc 10-K for FY2023

Bridgeline Digital, Inc. (BLIN)

10-K 2023-12-27 For: 2023-09-30

Added on April 07, 2026

About this 10-K

Bridgeline Digital, Inc filed this 10-K on December 27, 2023, covering the fiscal year ended September 30, 2023 (FY2023).

Headline figures

Fiscal year ended September 30, 2023, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $15.89M; down 5.6% from $16.82M a year earlier
Net loss: $9.44M; compared with net income of $2.15M a year earlier
Diluted EPS: -$0.91; compared with $0.20 a year earlier

Search and read filings like this one from Claude or ChatGPT with the SEC filings MCP server →

Delaware	52-2263942	52-2263942
State or other jurisdiction of incorporation or organization	IRS Employer Identification No.	IRS Employer Identification No.

100 Sylvan Road, Suite G700
Woburn, Massachusetts	01801
(Address of Principal Executive Offices)	(Zip Code)

Title of each class	Trading Symbol	Name of exchange on which registered
Common Stock, $0.001 par value per share	BLIN	The Nasdaq Capital Market

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☒	Smaller reporting company ☒
	Emerging growth company ☐

	●	Associations and Foundations
	●	Banks and Credit Unions
	●	eCommerce Retailers
	●	Franchises & Enterprises
	●	Health Services and Life Sciences
	●	Industrial Distribution and Wholesale
	●	Manufacturers
	●	Technology

	●	harm to our reputation;
	●	lost sales;
	●	delays in commercial release;
	●	product liability claims;
	●	contractual disputes;
	●	negative publicity;
	●	delays in or loss of market acceptance of our products;
	●	license terminations or renegotiations; or
	●	unexpected expenses and diversion of resources to remedy errors.

	●	be expensive and time consuming to defend;
	●	result in negative publicity;
	●	force us to stop licensing our products that incorporate the challenged intellectual property;
	●	require us to redesign our products;
	●	divert management’s attention and our other resources; and/or
	●	require us to enter into royalty or licensing agreements in order to obtain the right to use necessary technologies, which may not be available on terms acceptable to us, if at all.

	●	changes in demand for our products;
	●	introduction, enhancement or announcement of products by us or our competitors;
	●	market acceptance of our new products;
	●	the growth rates of certain market segments in which we compete;
	●	size and timing of significant orders;
	●	budgeting cycles of customers;
	●	mix of products and services sold;
	●	changes in the level of operating expenses;
	●	completion or announcement of acquisitions; and
	●	general economic conditions in regions in which we conduct business.

Geographic Location	Address	Description
Woburn, Massachusetts	100 Sylvan Rd, Suite G-700 Woburn, MA 01801	Professional office space
Woodbury, New York	150 Woodbury Road Woodbury, NY 11797	Professional office space
Rosemont, Illinois	5600 North River Rd, Suite 100 Rosemont, IL 60018	Professional office space
Atascadero, California	6225 Atascadero Ave Atascadero, CA 93422	Professional office space
Ontario, Canada	Perth Mews RO Perth, ON K7H 3A0, Canada	PO Box
Brussels, Belgium	Cours Saint Michel 30B 1040 Etterbeek Brussels, Belgium	Professional office space

(in thousands)	Year Ended September 30,
									$			%
	2023			%	2022			%	Change			Change
Net Revenue
Subscription and perpetual licenses	$	12,742		80%	$	13,560		81%	$	(818	)	(6)%
Digital engagement services		3,143		20%		3,259		19%		(116	)	(4)%
Total net revenue		15,885				16,819				(934	)	(6)%

Cost of revenue
Subscription and perpetual licenses		3,364		26%		3,358		25%		6		0%
Digital engagement services		1,650		52%		1,759		54%		(109	)	(6)%
Total cost of revenue		5,014		32%		5,117		30%		(103	)	(2)%
Gross profit		10,871		68%		11,702		70%		(831	)	(7)%

Operating expenses
Sales and marketing		4,757		30%		5,232		31%		(475	)	(9)%
General and administrative		3,173		20%		3,387		20%		(214	)	(6)%
Research and development		3,679		23%		3,217		19%		462		14%
Depreciation and amortization		1,528		10%		1,599		10%		(71	)	(4)%
Goodwill impairment		7,517		47%		-		0%		7,517		N/A
Restructuring and acquisition related expenses		132		1%		164		1%		(32	)	(20)%
Total operating expenses		20,786				13,599				7,187		53%

Loss from operations		(9,915	)			(1,897	)			(8,018	)	423%
Change in fair value of contingent consideration, interest expense and other, net		(189	)			417				(606	)	(145)%
Change in fair value of warrant liabilities		575				3,655				(3,080	)	(84)%
Income (loss) before income taxes		(9,529	)			2,175				(11,704	)	(538)%
Provision for (benefit from) income taxes		(94	)			30				(124	)	(413)%

Net (loss) income	$	(9,435	)		$	2,145			$	(11,580	)	(540)%

Non-GAAP Measure:
Adjusted EBITDA	$	(309	)		$	196			$	(505	)	(258)%

	●	Revenue recognition;
	●	Allowance for doubtful accounts;
	●	Accounting for goodwill and other intangible assets;
	●	Accounting for business combinations;
	●	Accounting for common stock purchase warrants; and
	●	Accounting for stock-based compensation.

			Page

Report of Independent Registered Public Accounting Firm			26
Consolidated Balance Sheets as of September 30, 2023 and 2022			28
Consolidated Statements of Operations for the years ended September 30, 2023 and 2022			29
Consolidated Statements of Comprehensive Income/(Loss) for the years ended September 30, 2023 and 2022			30
Consolidated Statements of Stockholders’ Equity for the years ended September 30, 2023 and 2022			31
Consolidated Statements of Cash Flows for the years ended September 30, 2023 and 2022			32
Notes to Consolidated Financial Statements			33

	*As of September 30,*
	*2023*			*2022*
ASSETS
Current assets:
Cash and cash equivalents	$	2,377		$	2,856
Accounts receivable, net		1,004			1,182
Prepaid expenses and other current assets		278			242
Total current assets		3,659			4,280
Property and equipment, net		151			268
Operating lease assets		390			589
Intangible assets, net		4,890			6,268
Goodwill, net		8,468			15,985
Other assets		73			123
Total assets	$	17,631		$	27,513

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	267		$	429
Current portion of operating lease liabilities		148			199
Accounts payable		1,255			972
Accrued liabilities		995			995
Purchase price and contingent consideration payable, current portion		-			250
Deferred revenue		2,084			1,943
Total current liabilities		4,749			4,788

Long-term debt, net of current portion		435			588
Operating lease liabilities, net of current portion		241			390
Warrant liabilities		174			749
Other long-term liabilities		572			646
Total liabilities		6,171			7,161

Commitments and contingencies (Note 14)

Stockholders’ equity:
Preferred stock - $0.001 par value; 1,000,000 shares authorized;
Series C Convertible Preferred stock: 11,000 shares authorized; 350 shares issued and outstanding at September 30, 2023 and 2022		-			-
Series D Convertible Preferred stock: 4,200 shares authorized; no shares issued and outstanding at September 30, 2023 and 2022		-			-
Common stock - $0.001 par value; 50,000,000 shares authorized; 10,417,609 shares issued and outstanding at September 30, 2023 and September 30, 2022		10			10
Additional paid-in capital		101,275			100,704
Accumulated deficit		(89,577	)		(80,142	)
Accumulated other comprehensive loss		(248	)		(220	)
Total stockholders’ equity		11,460			20,352
Total liabilities and stockholders’ equity	$	17,631		$	27,513

	*Years Ended September 30,*
	*2023*			*2022*
Net revenue:
Subscription and perpetual licenses	$	12,742		$	13,560
Digital engagement services		3,143			3,259
Total net revenue		15,885			16,819

Cost of revenue:
Subscription and perpetual licenses		3,364			3,358
Digital engagement services		1,650			1,759
Total cost of revenue		5,014			5,117
Gross profit		10,871			11,702

Operating expenses:
Sales and marketing		4,757			5,232
General and administrative		3,173			3,387
Research and development		3,679			3,217
Depreciation and amortization		1,528			1,599
Goodwill impairment		7,517			-
Restructuring and acquisition related expenses		132			164
Total operating expenses		20,786			13,599

Loss from operations		(9,915	)		(1,897	)
Interest (income) expense and other, net		(189	)		417
Change in fair value of warrant liabilities		575			3,655
Income (loss) before income taxes		(9,529	)		2,175
Provision for (benefit from) income taxes		(94	)		30

Net (loss) income	$	(9,435	)	$	2,145

Net (loss) income per share attributable to common stockholders:
Basic	$	(0.91	)	$	0.21
Diluted	$	(0.91	)	$	0.20
Number of weighted average shares outstanding:
Basic		10,417,609			10,232,862
Diluted		10,424,187			10,366,907

	*Year Ended September 30,*
	*2023*			*2022*
Net income (loss)	$	(9,435	)	$	2,145
Other comprehensive income (loss):
Net change in foreign currency translation adjustment		(28	)		133
Comprehensive income (loss)	$	(9,463	)	$	2,278

														*Accumulated*
	*Preferred Stock*				*Common Stock*				*Additional*					*Other*			*Total*
									*Paid-in*		*Accumulated*			*Comprehensive*			*Stockholders’*
	*Shares*		*Amount*		*Shares*		*Amount*		*Capital*		*Deficit*			*Loss*			*Equity*
Balance at September 30, 2021		350	$	-		10,187,128	$	10	$	100,207	$	(82,287	)	$	(353	)	$	17,577
Stock-based compensation expense		-		-		-		-		478		-			-			478
Issuance of common stock – stock options exercised		-		-		13,333		-		19		-			-			19
Issuance of common stock – warrants exercised		-		-		17,148		-		-		-			-			-
Issuance of restricted common stock		-		-		200,000		-		-		-			-			-
Net income		-		-		-		-		-		2,145			-			2,145
Foreign currency translation		-		-		-		-		-		-			133			133
Balance at September 30, 2022		350	$	-		10,417,609	$	10	$	100,704	$	(80,142	)	$	(220	)	$	20,352
Stock-based compensation expense		-		-		-		-		571		-			-			571
Net loss		-		-		-		-		-		(9,435	)		-			(9,435	)
Foreign currency translation		-		-		-		-		-		-			(28	)		(28	)
Balance at September 30, 2023		350	$	-		10,417,609	$	10	$	101,275	$	(89,577	)	$	(248	)	$	11,460

Description	*Estimated Useful Life (in years)*
Technology		3 - 5
Customer related		3 - 10
Domain and trade names		1 - 15

	*As of September 30, 2023*									*As of September 30, 2022*
	*Montage Capital*			*Series C Preferred*			*Series D Preferred*			*Montage Capital*			*Series C Preferred*			*Series D Preferred*
Volatility		60.7	%		51.7	%		73.6	%		82.0	%		83.9	%		84.7	%
Risk-free rate		5.0	%		5.5	%		4.8	%		4.2	%		4.2	%		4.1	%
Stock price	$	0.83		$	0.83		$	0.83		$	1.31		$	1.31		$	1.31

	*As of September 30, 2023*
	*Level 1*		*Level 2*		*Level 3*		*Total*
Assets:
Goodwill, net	$	-	$	-	$	8,468	$	8,468
Liabilities:
Warrant liabilities:
Montage		-		-		12		12
Series A and C		-		-		11		11
Series D		-		-		151		151
Total warrant liabilities	$	-	$	-	$	174	$	174

	*Contingent Consideration Obligations*			*Warrant Liabilities*
Balance at beginning of period, October 1, 2021	$	3,649		$	4,404
Additions		-			-
Exercises or payments		(2,768	)		-
Adjustment to fair value		(631	)		(3,655	)
Balance at end of period, September 30, 2022	$	250		$	749
Additions		-			-
Exercises or payments		(250	)		-
Adjustment to fair value		-			(575	)
Balance at end of period, September 30, 2023	$	-		$	174

Fiscal year:
2024	$	267
2025		204
2026		77
2027		77
2028		77
Total debt	$	702

	*Payments Operating Leases*			*Receipts Subleases*		*Net Leases*
Fiscal year:
2024	$	177		$	25	$	152
2025		151			-		151
2026		72			-		72
2027		61			-		61
2028		11			-		11
Total lease commitments		472		$	25	$	447
Less: Amount representing interest		(83	)
Present value of lease liabilities		389
Less: Current portion		(148	)
Operating lease liabilities, net of current portion	$	241

Type	Issue Date	Shares		Price		Expiration
Financing (Montage)	10/10/2017		1,327	$	132.50	10/10/2025
Investors	10/19/2018		3,120	$	25.00	10/19/2023
Placement Agent	10/16/2018		10,000	$	31.25	10/16/2023
Investors	3/12/2019		41,621	$	4.00	10/19/2023
Investors	3/12/2019		872,625	$	4.00	9/12/2024
Investors	3/12/2019		13,738	$	0.05	9/12/2024
Placement Agent	3/12/2019		11,992	$	4.00	9/12/2024
Placement Agent	2/4/2021		31,564	$	3.88	2/4/2026
Investors	5/14/2021		592,106	$	2.51	11/16/2026
Placement Agent	5/14/2021		179,536	$	2.85	5/12/2026
Total			1,757,629

	*2023*						*2022*
	*Board*			*Non-Board*			*Board*			*Non-Board*
Weighted-average fair value per share option	$	0.84		$	0.90		$	1.30		$	1.40
Expected life (in years)		5.0			5.8			5.0			6.0
Volatility		88.5	%		90.7	%		89.2	%		95.0	%
Risk-free interest rate		4.1	%		4.0	%		2.8	%		2.8	%
Dividend yield		0.0	%		0.0	%		0.0	%		0.0	%

	*Restricted Stock*		*Stock Options*					*Stock Warrants*
						*Weighted Average*					*Weighted Average*
	*Awards*		*Awards*			*Exercise Price*		*Warrants*			*Exercise Price*
Outstanding, October 1, 2021		-		750,232		$	4.84		1,788,745		$	4.18
Granted		200,000		535,000			1.82		-			-
Exercised		-		(13,334	)		1.40		(26,605	)		3.88
Forfeited		-		(113,838	)		3.69		-			-
Expired		-		(133	)		937.88		(4,511	)		218.89
Outstanding, September 30, 2022		200,000		1,157,927		$	3.49		1,757,629		$	3.64
Granted		-		702,000			1.19		-			-
Exercised		-		-			-		-			-
Forfeited		-		(28,348	)		2.49		-			-
Expired		-		(64	)		1,873.44		-			-
Outstanding, September 30, 2023		200,000		1,831,515		$	2.56		1,757,629		$	3.64

				*Weighted Average*
				*Grant-Date*
	*Shares*			*Fair Value*
Unvested at October 1, 2022		538,466		$	1.37
Granted		702,000			0.89
Vested		(541,048	)		1.08
Forfeited/Cancelled		(16,000	)		1.75
Unvested at September 30, 2023		683,418		$	1.10

Exercise Price	*Number of Options*		*Weighted Average Remaining Contractual Life (Years)*		*Weighted Average Exercise Price*		*Aggregate Intrinsic Value*
Options outstanding		1,831,515		8.3	$	2.56	$	-
Options exercisable		1,148,097		7.8	$	3.23	$	-

(in thousands, except share and per share data)
	*Years Ended September 30,*
	*2023*			*2022*
Numerator:
Net income (loss) applicable to common stockholders - basic earnings per share	$	(9,435	)	$	2,145
Effect of dilutive securities:
Change in fair value of in-the-money warrant derivative liabilities		(6	)		(39	)
Net income (loss) applicable to common stockholders - diluted earnings per share	$	(9,441	)	$	2,106

Denominator:
Weighted-average shares outstanding for basic earnings per share		10,417,609			10,232,862
Effect of dilutive securities:
Options		-			81,765
Warrants		6,578			13,391
Preferred stock		-			38,889
Weighted-average shares outstanding for diluted earnings per share		10,424,187			10,366,907

Basic net income (loss) per share	$	(0.91	)	$	0.21
Diluted net income (loss) per share	$	(0.91	)	$	0.20

	*Year Ended September 30,*
Revenues:	*2023*		*2022*
United States	$	12,828	$	13,202
International		3,057		3,617
	$	15,885	$	16,819

	*Deferred Revenue*
	*Current*			*Long Term*
Balance as of October 1, 2021	$	2,097		$	418
Increase (decrease)		(154	)		(34	)
Balance as of September 30, 2022		1,943			384
Increase (decrease)		141			(39	)
Balance as of September 30, 2023	$	2,084		$	345

	*September 30,*
	*2023*			*2022*
Deferred tax assets:
Bad debt reserve	$	46		$	37
Accrued expenses		78			80
Net operating loss carryforwards		10,627			10,456
Right of use liability		248			146
Stock options		379			309
Other		17			17
Total deferred tax assets		11,395			11,045
Valuation allowance		(10,802	)		(10,542	)
Net deferred tax assets		593			503

Deferred tax liabilities:
Right of use asset		248			146
Depreciation		47			47
Intangibles		525			572
Total deferred tax liabilities		820			765
Net deferred tax liabilities	$	(227	)	$	(262	)

Name	Age	Position	Director Class	Expiration of Class Term

Joni Kahn	68	Chairperson (1)(2)(3)(4)	Class I	2024 Annual Meeting

Kenneth Galaznik	72	Director (1)(2)(4)	Class II	2025 Annual Meeting

Scott Landers	53	Director (1)(2)(3)(4)	Class II	2025 Annual Meeting

Michael Taglich	58	Director	Class III	2023 Annual Meeting

Roger Kahn	54	Director, President and Chief Executive Officer	Class I	2024 Annual Meeting

Thomas R. Windhausen	45	Chief Financial Officer, Treasurer and Secretary

(1)	Member of the Audit Committee.
(2)	Member of the Compensation Committee.
(3)	Member of the Nominating and Governance Committee.
(4)	Independent director.

Name and Principal Position	Fiscal Year End	Salary		Bonus		Total
Roger Kahn - President and Chief Executive Officer	2023	$	400,000	$	99,188	$	499,188
	2022	$	339,333	$	114,411	$	453,744

Thomas R. Windhausen - Chief Financial Officer, Treasurer, and Secretary	2023	$	251,250	$	42,534	$	293,784
	2022	$	240,000	$	16,818	$	256,818

Name	Grant Date		Number of Securities Underlying Unexercised Options Exercisable (1)		Number of Securities Underlying Unexercised Options Unexercisable (1)		Exercise Price ($/sh)		Option Expiration Date

Roger Kahn	8/24/2015	(1)		800		-	$	287.50	8/24/2025
	8/19/2016	(1)		4,446		-	$	205.00	8/19/2026
	11/20/2019	(1)		249,353		-	$	1.40	11/20/2029
	4/14/2022	(2)		181,000		181,000	$	1.85	4/14/2032
	6/30/2023	(2)		25,000		275,000	$	1.18	6/30/2033
	Total			460,599		456,000

Thomas R. Windhausen	9/30/2021	(1)		20,000		10,000	$	4.11	9/30/2031
	6/30/2023	(3)		2,500		27,500	$	1.18	6/30/2033
	Total			22,500		37,500