TaoWeave, Inc 10-Q for FY2023 Q1

TaoWeave, Inc. (TWAV)

10-Q 2023-05-10 For: 2023-03-31

Added on April 06, 2026

About this 10-Q

TaoWeave, Inc filed this 10-Q on May 10, 2023, covering the quarter ended March 31, 2023 (FY2023 Q1).

Headline figures

Quarter ended March 31, 2023, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $1.04M; down 32.2% from $1.53M a year earlier
Net loss: $1.22M; compared with a net loss of $4.54M a year earlier
Diluted EPS: -$0.60; compared with -$2.20 a year earlier

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


Delaware			77-0312442
(State or Other Jurisdiction of Incorporation or Organization)			(I.R.S. Employer Identification No.)


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


PART I - FINANCIAL INFORMATION
Item 1. Financial Statements		1
	Condensed Consolidated Balance Sheets at March 31, 2023 (unaudited) and December 31, 2022	1
	Unaudited Condensed Consolidated Statements of Operations for the three months ended March 31, 2023 and 2022	2
	Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three months ended March 31, 2023 and 2022	3
	Unaudited Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2023 and 2022	5
	Notes to unaudited Condensed Consolidated Financial Statements	6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		19
Item 3. Quantitative and Qualitative Disclosures About Market Risk		24
Item 4. Controls and Procedures		24

PART II - OTHER INFORMATION
Item 1. Legal Proceedings		24
Item 1A. Risk Factors		24
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		25
Item 3. Defaults Upon Senior Securities		25
Item 4. Mine Safety Disclosures		26
Item 5. Other Information		26
Item 6. Exhibits		27
Signatures		28


	March 31, 2023		December 31, 2022
	(Unaudited)
ASSETS
Current assets:
Cash	$	3,714	$	3,085

Accounts receivable, net	392		415
Inventory, net	634		723
Prepaid expenses and other current assets	947		649
Total current assets	5,687		4,872
Property and equipment, net	3		3

Intangibles, net	518		604
Operating lease - right of use asset, net	99		142
Other assets	31		40
Total assets	$	6,338	$	5,661
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	207	$	184
Accrued expenses and other current liabilities	1,665		1,074
Current portion of deferred revenue	341		436
Current portion of operating lease liabilities	139		219
Total current liabilities	2,352		1,913
Long-term liabilities:
Operating lease liabilities, net of current portion	—		17
Deferred revenue, net of current portion	84		114


Total liabilities	2,436		2,044
Commitments and contingencies (see Note 11)
Stockholders’ equity:
Preferred stock Series F, convertible; $.0001 par value; $6,550,000 stated value; 42,000 shares authorized, 6,550 and zero shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively	—		—
Common stock, $.0001 par value; 150,000,000 shares authorized; 2,070,861 shares issued and 2,063,308 outstanding at March 31, 2023 and December 31, 2022	—		—
Treasury stock, 7,553 shares of common stock at March 31, 2023 and December 31, 2022	(181)		(181)
Additional paid-in capital	229,149		227,645
Accumulated deficit	(225,066)		(223,847)
Total stockholders' equity	3,902		3,617
Total liabilities and stockholders’ equity	$	6,338	$	5,661


	Three Months Ended
	March 31,
	2023		2022
Revenue	$	1,038	$	1,532
Cost of revenue (exclusive of depreciation and amortization)	762		1,033
Gross profit	276		499

Operating expenses:
Research and development	6		1,004
Sales and marketing	218		562
General and administrative	1,169		1,690
Impairment charges	—		1,138

Depreciation and amortization	86		627
Total operating expenses	1,479		5,021
Loss from operations	(1,203)		(4,522)
Interest and other expense, net	5		6
Other income	(27)		—

Interest and other (income) expense, net	(22)		6
Loss before income taxes	(1,181)		(4,528)
Income tax expense	38		11
Net loss	(1,219)		(4,539)



Warrant Modification	25		—
Net loss attributable to common stockholders	$	(1,244)	$	(4,539)

Net loss attributable to common stockholders per share:
Basic and diluted net loss per share	$	(0.60)	$	(2.20)


Weighted-average number of shares of common stock:
Basic and diluted	2,065		2,065


	Series F Preferred Stock			Common Stock			Treasury Stock
	Shares	Amount		Shares	Amount		Shares	Amount		Additional Paid-In Capital		Accumulated Deficit		Total
Balance at December 31, 2022	—	$	—	2,071,000	$	—	8,000	$	(181)	$	227,645	$	(223,847)	$	3,617
Net loss	—	—		—	—		—	—		—		(1,219)		(1,219)
Stock-based compensation	—	—		—	—		—	—		31		—		31
Proceeds from private placement, net of fees and amounts held in escrow	6,550	—		—	—		—	—		1,473		—		1,473
Balance at March 31, 2023	6,550	$	—	2,071,000	$	—	8,000	$	(181)	$	229,149	$	(225,066)	$	3,902


	Three Months Ended March 31,
	2023		2022
Cash flows from operating activities:
Net loss	$	(1,219)	$	(4,539)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	86		627
Bad debt (recovery) expense	(24)		111
Non-cash lease expense from right-of-use asset	43		127
Stock-based compensation	31		52

Forfeiture of unvested stock options	—		(84)






Impairment charges - goodwill	—		1,138
Changes in operating assets and liabilities:
Accounts receivable	47		183
Inventory	89		103
Prepaid expenses and other current assets	(298)		(360)
Other assets	9		45
Accounts payable	23		294
Accrued expenses and other current liabilities	591		188
Deferred revenue	(125)		(126)
Lease liabilities	(97)		(163)
Net cash used in operating activities	(844)		(2,404)
Cash flows from investing activities:
Purchases of property and equipment	—		(11)
Proceeds from sale of equipment	—		1
Net cash used in investing activities	—		(10)
Cash flows from financing activities:
Proceeds from private placement, net of issuance costs and amounts in escrow	1,473		—

Net cash provided by financing activities	1,473		—
Increase (decrease) in cash and restricted cash	629		(2,414)
Cash and restricted cash at beginning of period	3,085		9,000
Cash and restricted cash at end of period	$	3,714	$	6,586

Supplemental disclosures of cash flow information:

Reconciliation of cash and restricted cash
Cash	$	3,714	$	6,525
Restricted cash	—		61
Total cash and restricted cash	$	3,714	$	6,586

Cash paid during the period for interest	$	2	$	—
Cash paid for income taxes	$	31	$	—
Non-cash investing and financing activities:

Warrant modification	$	25	$	—


	As of March 31, 2023						As of December 31, 2022
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount




Developed technology	$	486	$	(121)	$	365	$	486	$	(61)	$	425
Trade names	204		(51)		153		204		(25)		179

Total	$	690	$	(172)	$	518	$	690	$	(86)	$	604


	March 31,		December 31,
	2023		2022

Compensation costs	$	779	$	707
Customer deposits	271		128
Professional fees	344		57
Taxes and regulatory fees	43		59
Other accrued expenses and liabilities	77		123
Rent expense	151		—

Accrued expenses and other liabilities	$	1,665	$	1,074


Remaining Lease Payments
2023	$	125
2024	17
Total lease payments	142
Effect of discounting	(3)
Total lease liability	$	139


	Right-of-Use Asset		Operating Lease Liabilities
Balance at December 31, 2021	$	659	$	728
Additions	11		11

Non-cash lease expense and payments	(349)		(503)
Impairment charges	(179)		—
Balance at December 31, 2022	142		236
Additions	—		—
Terminations and modifications	$	—	$	—
Non-cash lease expense and payments	(43)		(97)
Impairment charges	—		—
Balance at March 31, 2023	$	99	$	139


Issue Date	Warrants Issued	Exercise Price		Expiration Date
October 21, 2020	34,767	$	61.20	April 22, 2023
December 6, 2020	41,667	82.35		June 7, 2023
June 28, 2021	66,667	60.00		January 4, 2024 (a)
June 28, 2021	200,000	66.00		June 28, 2024
March 31, 2023	4,136,846	$	1.71	September 30, 2028

	4,479,947


	Outstanding
	Number of Warrants	Weighted Average Exercise Price
Warrants outstanding and exercisable, December 31, 2021	343,101	$	66.34




Warrants outstanding and exercisable, December 31, 2022	343,101	66.34
Granted	4,136,846	1.71



Warrants outstanding and exercisable, March 31, 2023	4,479,947	$	6.66


	Outstanding			Exercisable
	Number of Options	Weighted Average Exercise Price		Number of Options	Weighted Average Exercise Price
Options outstanding and exercisable, December 31, 2021	27,169	$	113.63	7,169	$	—


Vested	—	—		3,332	48.75
Expired	(501)	410.18		(501)	410.18
Forfeited	(10,000)	48.75		—	—
Options outstanding and exercisable, December 31, 2022	16,668	143.63		10,000	206.85



Expired	(6,501)	289.77		(6,501)	289.77

Options outstanding and exercisable, March 31, 2023	10,167	$	50.17	3,499	$	52.87


	Outstanding				Exercisable
Range of price	Number of Options	Weighted Average Remaining Contractual Life (In Years)	Weighted Average Exercise Price		Number of Options	Weighted Average Exercise Price
$0.00 – $100.00	10,000	8.25	$	48.75	3,332	$	48.75
$100.01 – $200.00	167	0.25	135.00		167	135.00



	10,167	8.12	$	50.17	3,499	$	52.87


	Three Months Ended March 31,
	2023		% of Revenue		2022		% of Revenue
Revenue: Managed Services
Video collaboration services	$	64	6	%	$	116	7	%
Network services	618		60	%	821		54	%
Professional and other services	8		1	%	29		2	%
Total Managed Services revenue	$	690	67	%	$	966	63	%

Revenue: Collaboration Products
Visual collaboration product offerings	$	348	33	%	$	562	37	%

Licensing	—		—	%	4		—	%
Total Collaboration Products revenue	348		33	%	566		37	%
Total revenue	$	1,038	100	%	$	1,532	100	%


	Three Months Ended March 31,
	2023		% of Revenue		2022		% of Revenue
Revenue: Managed Services
Video collaboration services	$	64	6	%	$	116	7	%
Network services	618		60	%	821		54	%
Professional and other services	8		1	%	29		2	%
Total Managed Services revenue	$	690	67	%	$	966	63	%

Revenue: Collaboration Products
Visual collaboration product offerings	$	348	33	%	$	562	37	%
Licensing	—		—	%	4		—	%
Total Collaboration Products revenue	348		33	%	566		37	%
Total revenue	$	1,038	100	%	$	1,532	100	%


	OBLONG, INC.

May 10, 2023	By:	/s/ Peter Holst
		Peter Holst
		Chief Executive Officer
		(Principal Executive Officer)


May 10, 2023	By:	/s/ David Clark
		David Clark
		Chief Financial Officer
		(Principal Financial and Accounting Officer)


	Three Months Ended March 31, 2023
	Managed Services			Collaboration Products			Corporate		Total
Revenue	$	690		$	348		$	—	$	1,038
Cost of revenues	460			302			—		762
Gross profit	$	230		$	46		$	—	$	276
Gross profit %	33		%	13		%			27		%

Allocated operating expenses	$	—		$	286		$	—	$	286
Unallocated operating expenses	—			—			1,193		1,193
Total operating expenses	$	—		$	286		$	1,193	$	1,479

Income (loss) from operations	$	230		$	(240)		$	(1,193)	$	(1,203)
Interest and other expense (income), net	3			(25)			—		(22)
Net income (loss) before tax	233			(215)			(1,193)		(1,181)
Income tax expense	7			31			—		38
Net income (loss)	$	226		$	(246)		$	(1,193)	$	(1,219)


	Three Months Ended March 31, 2022
	Managed Services			Collaboration Products			Corporate		Total
Revenue	$	966		$	566		$	—	$	1,532
Cost of revenues	645			388			—		1,033
Gross profit	$	321		$	178		$	—	$	499
Gross profit %	33		%	31		%			33		%

Allocated operating expenses	$	56		$	3,425		$	—	$	3,481
Unallocated operating expenses	—			—			1,540		1,540
Total operating expenses	$	56		$	3,425		$	1,540	$	5,021

Income (loss) from operations	$	265		$	(3,247)		$	(1,540)	$	(4,522)
Interest and other expense (income), net	6			—			—		6
Income (loss) before income taxes	271			(3,247)			(1,540)		(4,528)
Income tax expense	9			2			—		11
Net income (loss)	$	262		$	(3,249)		$	(1,540)	$	(4,539)


Exhibit Number						Description
3.1*						Amended and Restated Certificate of Incorporation, as amended.
4.1						Form of Amendment to Series A Warrants (filed as Exhibit 4.1 to the Registrants Current Report on Form 8-K, filed with the SEC on January 3, 2023, and incorporated herein by reference).
4.2						Certificate of Designations, Preferences and Rights of Series D Preferred Stock (filed as Exhibit 4.6 to the Registrant’s Current Report on Form 8-K filed with the SEC on September 24, 2007, and incorporated herein by reference).
4.3						Certificate of Designations, Preferences and Rights of Series A-2 Preferred Stock of the Registrant (filed as Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on August 11, 2009, and incorporated herein by reference).
4.4						Certificate of Designations, Preferences and Rights of Perpetual Series B Preferred Stock of the Registrant (filed as Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on March 30, 2010, and incorporated herein by reference).
4.5						Certificate of Designations, Preferences and Rights of Perpetual Series B-1 Preferred Stock of the Registrant (filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on August 9, 2011, and incorporated herein by reference).
4.6						Certificate of Designations of Rights, Powers, Preferences, Privileges and Restrictions of the 0% Series B Convertible Preferred Stock (filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on November 14, 2017, and incorporated herein by reference).
4.7						Certificate of Designations of Rights, Powers, Preferences, Privileges and Restrictions of the 0% Series C Convertible Preferred Stock (filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on January 25, 2018, and incorporated herein by reference).
4.8						Certificate of Designations of the 6.0% Series D Convertible Preferred Stock (filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on October 7, 2019, and incorporated herein by reference).
4.9						Certificate of Designations of the 6.0% Series E Convertible Preferred Stock (filed as Exhibit 3.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on October 7, 2019, and incorporated herein by reference).
4.10						Certificate of Designations of the 9.0% Series F Convertible Preferred Stock (filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 3, 2023, and incorporated herein by reference).
4.11						Form of Common Warrant (filed as Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 3, 2023, and incorporated herein by reference).
4.12						Form of Preferred Warrant (filed as Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 3, 2023, and incorporated herein by reference).
10.1						Securities Purchase Agreement, dated March 31, 2023 (filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 3, 2023, and incorporated herein by reference).
10.2						Registration Rights Agreement, dated March 31, 2023 (filed as Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 3, 2023, and incorporated herein by reference).
10.3						Engagement Letter, dated March 30, 2023 (filed as Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 3, 2023, and incorporated herein by reference).
10.4						Form of Warrant Repricing Letter, dated April 18, 2023 (filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 24, 2023, and incorporated herein by reference).
31.1*						Rule 13a—14(a)/15d—14(a) Certification of the Chief Executive Officer.
31.2*						Rule 13a—14(a)/15d—14(a) Certification of the Chief Financial Officer.
32.1**						Section 1350 Certification of the Chief Executive Officer and Chief Financial Officer.
101.INS						XBRL Instance Document
101.SCH						XBRL Taxonomy Extension Schema
101.CAL						XBRL Taxonomy Extension Calculation Linkbase
101.DEF						XBRL Taxonomy Extension Definition Linkbase
101.LAB						XBRL Taxonomy Extension Label Linkbase
101.PRE						XBRL Taxonomy Extension Presentation Linkbase