Quotemedia Inc 10-Q for FY2024 Q2

Quotemedia Inc (QMCI)

10-Q 2024-08-14 For: 2024-06-30

Added on April 06, 2026

About this 10-Q

Quotemedia Inc filed this 10-Q on August 14, 2024, covering the quarter ended June 30, 2024 (FY2024 Q2).

Headline figures

Quarter ended June 30, 2024, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $4.68M; down 0.8% from $4.71M a year earlier
Net loss: $251.17K; compared with net income of $73.04K a year earlier
Diluted EPS: $0.00; compared with $0.00 a year earlier

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Nevada		91-2008633
(State or Other Jurisdiction of Incorporation or Organization)		(IRS Employer Identification Number)

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☒
(Do not check if a smaller reporting company)		Emerging growth company	☐

		Page
Part I.	Financial Information

Item 1.	Consolidated financial statements (unaudited):	3

	Condensed Consolidated Balance Sheets at June 30, 2024 and December 31, 2023	3

	Condensed Consolidated Statements of Operations for the three and six-months ended June 30, 2024 and 2023	4

	Condensed Consolidated Statements of Stockholders’ Equity for the three and six-months ended June 30, 2024	5

	Condensed Consolidated Statements of Changes in Series A Redeemable Convertible Preferred Stock and Stockholders’ Deficit for the three and six-months ended June 30, 2023	6

	Condensed Consolidated Statements of Cash Flows for the six-months ended June 30, 2024 and 2023	7

	Notes to Condensed Consolidated Financial Statements	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18

Item 4.	Controls and Procedures	24

Part II.	Other Information

Item 6.	Exhibits	25

Signatures		26

	June 30, 2024			December 31, 2023
ASSETS

Current assets:
Cash and cash equivalents	$	232,735		$	342,014
Accounts receivable, net		1,250,482			1,154,787
Prepaid expenses		218,552			133,478
Other current assets		132,176			104,931
Total current assets		1,833,945			1,735,210

Deposits		16,404			16,850
Property and equipment, net		261,551			302,224
Capitalized internal-use software development costs, net		4,833,259			4,552,910
Goodwill		110,000			110,000
Intangible assets		56,570			65,636
Operating lease right-of-use assets (see note 5)		292,047			393,472

Total assets	$	7,403,776		$	7,176,302

LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK, AND STOCKHOLDERS’ EQUITY (DEFICIT)

Current liabilities:
Accounts payable and accrued liabilities	$	2,532,243		$	2,210,933
Deferred revenue (see note 3)		1,865,332			1,456,381
Operating lease liabilities (see note 5)		204,686			206,146
Total current liabilities		4,602,261			3,873,460

Long-term liabilities:
Deferred revenue (see note 3)		258,676			375,568
Operating lease liabilities (see note 5)		84,899			191,735
Preferred stock warrant liability (see note 6)		-			611,563
Total long-term liabilities		343,575			1,178,866

Mezzanine equity:
Preferred stock, 10,000,000 shares authorized: Series A redeemable convertible preferred stock, $0.001 par value, 550,000 shares designated; shares issued and outstanding: 123,685 at June 30, 2024 and December 31, 2023 (see note 6)		-			2,983,857
Stockholders’ equity:
Preferred stock, 10,000,000 shares authorized: Series A redeemable convertible preferred stock, $0.001 par value, 550,000 shares designated; shares issued and outstanding: 123,685 at June 30, 2024 and December 31, 2023 (see note 6)		2,983,857			-
Common stock, $0.001 par value, 150,000,000 shares authorized, shares issued and outstanding: 90,477,798 at June 30, 2024 and December 31, 2023		90,479			90,479
Additional paid-in capital		19,523,795			18,910,482
Accumulated deficit		(20,140,191	)		(19,860,842	)
Total stockholders’ equity (deficit)		2,457,940			(859,881	)

Total liabilities, mezzanine equity and stockholders’ equity (deficit)	$	7,403,776		$	7,176,302

	Three-months ended June 30,						Six-months ended June 30,
	2024			2023			2024			2023

REVENUE (see note 3)	$	4,675,946		$	4,712,977		$	9,355,146		$	9,463,025

COST OF REVENUE		2,431,460			2,324,798			4,773,574			4,644,733

GROSS PROFIT		2,244,486			2,388,179			4,581,572			4,818,292

OPERATING EXPENSES

Sales and marketing		857,524			829,712			1,634,726			1,653,765
General and administrative		860,327			770,187			1,668,681			1,622,701
Software development		787,074			684,015			1,590,396			1,314,088
		2,504,925			2,283,914			4,893,803			4,590,554

OPERATING INCOME (LOSS)		(260,439	)		104,265			(312,231	)		227,738

OTHER INCOME (EXPENSES)

Foreign exchange gain (loss)		10,415			(30,073	)		35,722			(38,074	)
Interest expense		(419	)		(404	)		(1,372	)		(1,856	)
		9,996			(30,477	)		34,350			(39,930	)
NET INCOME (LOSS) BEFORE INCOME TAXES		(250,443	)		73,788			(277,881	)		187,808

Income tax expense		(730	)		(752	)		(1,468	)		(1,482	)

NET INCOME (LOSS)	$	(251,173	)	$	73,036		$	(279,349	)	$	186,326

EARNINGS (LOSS) PER SHARE (see note 7)

Basic earnings (loss) per share	$	(0.00	)	$	0.00		$	(0.00	)	$	0.00
Diluted earnings (loss) per share	$	(0.00	)	$	0.00		$	(0.00	)	$	0.00

WEIGHTED AVERAGE SHARES OUTSTANDING (see note 7)

Basic		90,477,798			90,477,798			90,477,798			90,477,798
Diluted		90,477,798			121,000,418			90,477,798			120,876,073

	Series A Redeemable Convertible Preferred Stock				Common Stock
Three-months ended June 30, 2024:	Number of Shares		Amount		Number of Shares		Amount		Additional Paid-in Capital		Accumulated Deficit			Total Stockholders’ Equity (Deficit)

Balance, March 31, 2024		-	$	-		90,477,798	$	90,479	$	18,910,482	$	(19,889,018	)	$	(888,057	)

Reclassification of preferred stock warrants		-		-		-		-		611,563		-			611,563

Reclassification of series A redeemable convertible preferred stock		123,685		2,983,857		-		-		-		-			2,983,857

Stock-based compensation		-		-		-		-		1,750		-			1,750

Net loss		-		-		-		-		-		(251,173	)		(251,173	)

Balance, June 30, 2024		123,685	$	2,983,857		90,477,798	$	90,479	$	19,523,795	$	(20,140,191	)	$	2,457,940

	Series A Redeemable Convertible Preferred Stock				Common Stock
Six-months ended June 30, 2024:	Number of Shares		Amount		Number of Shares		Amount		Additional Paid-in Capital		Accumulated Deficit			Total Stockholders’ Equity (Deficit)

Balance, December 31, 2023		-	$	-		90,477,798	$	90,479	$	18,910,482	$	(19,860,842	)	$	(859,881	)

Reclassification of preferred stock warrants		-		-		-		-		611,563		-			611,563

Reclassification of series A redeemable convertible preferred stock		123,685		2,983,857		-		-		-		-			2,983,857

Stock-based compensation		-		-		-		-		1,750		-			1,750

Net loss		-		-		-		-		-		(279,349	)		(279,349	)

Balance, June 30, 2024		123,685	$	2,983,857		90,477,798	$	90,479	$	19,523,795	$	(20,140,191	)	$	2,457,940

	Series A Redeemable Convertible Preferred Stock				Common Stock
Three-months ended June 30, 2023:	Number of Shares		Amount		Number of Shares		Amount		Additional Paid-in Capital		Accumulated Deficit			Total Stockholders’ Deficit
Balance, March 31, 2023		123,685	$	2,983,857		90,477,798	$	90,479	$	18,903,272	$	(20,109,136	)	$	(1,115,385	)

Net income		-		-		-		-		-		73,036			73,036

Balance, June 30, 2023		123,685	$	2,983,857		90,477,798	$	90,479	$	18,903,272	$	(20,036,100	)	$	(1,042,349	)

	Series A Redeemable Convertible Preferred Stock				Common Stock
Six-months ended June 30, 2023:	Number of Shares		Amount		Number of Shares		Amount		Additional Paid-in Capital		Accumulated Deficit			Total Stockholders’ Deficit
Balance, December 31, 2022		123,685	$	2,983,857		90,477,798	$	90,479	$	18,903,272	$	(20,222,426	)	$	(1,228,675	)

Net income		-		-		-		-		-		186,326			186,326

Balance, June 30, 2023		123,685	$	2,983,857		90,477,798	$	90,479	$	18,903,272	$	(20,036,100	)	$	(1,042,349	)

	·	Proprietary financial software applications and streaming market data feeds
	·	Subscriptions are typically sold for a fixed fee and revenue is recognized ratably over the term of the subscription.

	o	Web-delivered, embedded applications providing real-time, streaming market quotes and research information targeted to both professionals and non-professional users.
	o	Revenue is typically earned based on customer usage.

	·	Identification of the contract, or contracts, with a customer

	·	Identification of the performance obligations in the contract

	·	Determination of the transaction price

	·	Allocation of the transaction price to the performance obligations in the contract

	·	Recognition of revenue when, or as, the Company satisfies a performance obligation

	2024			2023
Beginning balance at Jan 1,	$	1,831,949		$	1,166,848
Revenue recognized in the current period from the amounts in the beginning balance		(1,105,335	)		(868,395	)
New deferrals, net of amounts recognized in the current period		1,381,619			1,507,660
Effects of foreign currency translation		15,775			3,185
Total deferred revenue	$	2,124,008		$	1,809,298

Current portion of deferred revenue	$	1,865,332	$	1,530,329
Long-term portion of deferred revenue		258,676		278,969
Total deferred revenue	$	2,124,008	$	1,809,298

	June 30, 2024		December 31, 2023
Operating Leases

Operating lease right-of-use assets	$	292,047	$	393,472

Current portion of operating lease liability	$	204,686	$	206,146
Long-term portion of operating lease liability		84,899		191,735
Total operating lease liability	$	289,585	$	397,881

	Three-months ended June 30,				Six-months ended June 30,
	2024		2023		2024		2023
Portfolio Management Systems
Corporate Quotestream	$	1,782,826	$	1,876,898	$	3,564,511	$	3,704,151
Individual Quotestream		466,695		474,143		935,700		961,710
Interactive Content and Data APIs		2,426,425		2,361,936		4,854,935		4,797,164
Total revenue	$	4,675,946	$	4,712,977	$	9,355,146	$	9,463,025

	June 30, 2024			December 31, 2023
Weighted Average Remaining Lease Term
Operating leases	1.5 years			1.9 years
Weighted Average Discount Rate
Operating leases		9.5	%		9.5	%

Year ending December 31,	Operating Leases
2024 (excluding the six-months ended June 30, 2024)	$	114,182
2025		163,272
2026		33,861
Total lease payments		311,315
Less imputed interest		(21,730	)
Total	$	289,585

	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	115,146	$	116,784

	Common Stock Options and Warrants			Weighted-Average Grant Date Exercise Price

Outstanding at December 31, 2023		25,772,803		$	0.06
Granted during the period		350,000		$	0.03
Forfeited during the period		(350,000	)	$	0.03
Outstanding at June 30, 2024		25,772,803		$	0.06

	·	Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company could access.

	·	Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted intervals.

	·	Level 3 inputs are unobservable inputs for the asset or liability, which is typically based on an entity’s own assumptions, as there is little, if any, related market activity.

Valuation Inputs	June 30, 2024		December 31, 2023
Expected Time to Expiration (years)		N/A		24.05
Stock Price on Valuation Date		N/A	$	0.23
Peer Volatility		N/A		47.35	%
Cash Flow Discount Rate		N/A		15.86	%

Fair value as of December 31, 2023 and 2022, respectively	$	611,563		$	629,375
Change in fair value		-			78,125
Fair value as of March 31, 2024 and 2023, respectively	$	611,563		$	707,500
Change in fair value		-			59,688
Reclassification of preferred stock warrants on April 26, 2024		(611,563	)		-
Fair value as of June 30, 2024 and 2024, respectively		-			767,188

Exhibit Number		Description of Exhibit
31.1		Certification of Principal Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a), promulgated under the Securities Exchange Act of 1934, as amended.
31.2		Certification of Principal Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a), promulgated under the Securities Exchange Act of 1934, as amended.
32.1		Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2		Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

By:	/s/ Keith J. Randall
	Keith J. Randall
	Chief Executive Officer and Chief Financial Officer
	(Duly authorized officer and principal financial officer)

1.	I have reviewed this Quarterly Report on Form 10-Q of Quotemedia, Inc.;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15d-15(f)) for the registrant and have:

	a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

	b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

	c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

	a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

	b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 14, 2024	By:	/s/ Keith J. Randall
		Keith J. Randall
		Chief Executive Officer

	(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m(a) or 78o(d)); and

	(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

By:	/s/ Keith J. Randall
	Keith J. Randall
	Chief Financial Officer
	August 14, 2024