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FI

FARMHOUSE, INC. /NV (FMHS)·Q1 2021 Earnings Summary

Executive Summary

  • Q1 2021 delivered first measurable revenue in recent periods ($0.01M), a smaller net loss, and momentum from a new Twitter affiliate advertising channel; results in the 8-K press release are consistent with the 10-Q figures .
  • Strategic catalysts: launch of a paid Membership Benefits Program on WeedClub with a stated target of 10,000 subscribers by year-end, and a favorable arbitration award granting 49% of Los Angeles Farmers, Inc. to FMHS’s subsidiary (financial impact TBD) .
  • Liquidity remains constrained (no cash on hand at quarter-end; stockholders’ deficit of $1.24M); management initiated an offering of up to $0.51M to fund operations (going concern language present) .
  • No formal financial guidance and no earnings call transcript available; Street consensus from S&P Global for Q1 2021 was unavailable, limiting “vs. estimates” comparison .

What Went Well and What Went Wrong

  • What Went Well

    • Commercial traction: Affiliate advertising via the Twitter arrangement generated $8,850 in Q1 revenue; referral fees added $2,500, marking tangible progress in monetization .
    • Platform expansion: Launch of WeedClub Membership Benefits Program at $149/year to provide vetted service discounts; CEO set an ambitious target of 10,000 subscribers by year-end (“We would be surprised if we did not have at least 10,000 subscribers by the end of the year.” – Evan Horowitz) .
    • Legal milestone: Arbitration award to FMHS’s subsidiary for 49% of Los Angeles Farmers, Inc., plus share of profits since 2017 and going forward; a court‑appointed monitor will determine amounts due (impact not yet reflected in financials) .

  • What Went Wrong

    • Liquidity and capital structure: Zero cash at quarter‑end, $1.24M stockholders’ deficit, and reliance on related-party advances and equity raises; going concern language remains in place .
    • Limited revenue base and concentration: Q1 revenue of $11,350 relies heavily on affiliate ads; cost of revenues is nil but scale remains modest relative to fixed costs (OpEx $0.14M) .
    • No formal guidance or earnings call: Lack of quantitative outlook and absence of a transcript reduce visibility for investors; S&P Global consensus data unavailable to frame beats/misses .

Financial Results

MetricQ1 2020Q1 2021
Revenue ($USD)$0 $11,350
Net Income (Loss) ($USD)$(186,452) $(137,325)
Basic & Diluted EPS ($)$(0.01) $(0.01)
Total Operating Expenses ($USD)$159,856 $140,767
Interest Expense ($USD)$26,596 $7,908

Notes:

  • Prior quarter (Q4 2020) “quarterly” figures were not available via SEC filings search; we reviewed 10-K FY 2020 and Q1 2021 disclosures and found no Q4 2020 standalone 10-Q or 8-K 2.02 for trend analysis. We searched 2020-10-01 to 2021-03-31 for 8-K 2.02 and transcripts and found none.

Revenue Mix (Disaggregation)

Revenue TypeQ1 2020Q1 2021
Affiliate Advertising ($USD)$0 $8,850
Referral Fees ($USD)$0 $2,500
Subscription Fees ($USD)$0 $0
Event Sales ($USD)$0 $0
Consulting & Other ($USD)$0 $0
Total Revenue ($USD)$0 $11,350

Liquidity & Balance Sheet Snapshot

MetricFY 2020 (12/31/20)Q1 2021 (3/31/21)
Cash and Cash Equivalents ($USD)$3,906 $0
Total Assets ($USD)$5,178 $977
Total Current Liabilities ($USD)$1,140,890 $1,238,146
Stockholders’ Deficit ($USD)$(1,135,712) $(1,237,169)

Cash Flow (Operations)

MetricQ1 2020Q1 2021
Net Cash Used in Operating Activities ($USD)$(9,766) $(8,215)

KPIs and Other Operating Details

  • No cost of revenues in Q1 2021 or Q1 2020, implying gross profit equals revenue for those periods .
  • Weighted average shares: 14,513,457 (Q1’20) and 14,872,792 (Q1’21) .
  • Shares outstanding at 3/31/21: 14,922,079; subsequent to quarter-end: 15,010,943 .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Financial Guidance (Revenue, EPS, Margins)FY 2021NoneNone providedMaintained: No formal guidance
Membership Subscribers (qualitative target)FY 2021N/A“We would be surprised if we did not have at least 10,000 subscribers by the end of the year.”New qualitative target
Capital RaisingQ2 2021 (through 6/30/21)N/AAuthorized offering up to 1,000,000 shares at $0.51/share (max proceeds $510,000)New program
Equity Incentive PlanFY 2021N/A2021 Omnibus Incentive Plan approved; up to 3,000,000 shares for awardsNew program

Earnings Call Themes & Trends

No earnings call transcript found for Q1 2021 despite targeted search; themes below derive from 8-K press releases and the 10-Q.

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q1 2021)Trend
Twitter Affiliate AdvertisingNot found in prior-quarter earnings materials; FY20 press focused on 10-K and litigation .$8,850 affiliate ad revenue; positioned as a compliant DTC channel via pre-approval process .Emerging monetization channel; early traction.
Membership Benefits ProgramNot previously disclosed in earnings materials reviewed.Launched at $149 annual; aim to deliver vetted discounts to SMBs; 10,000 subscriber target .New growth lever; subscription potential.
Litigation/ArbitrationFY20 press described ongoing case; settlement with certain parties noted .Arbitration award granting 49% of LAFI to DTLA; monitor appointed; impact TBD .Potential upside; timing/quantum uncertain.
Liquidity & Capital RaisesOngoing reliance on officer loans/equity; going concern persists (FY20) .Zero cash, stockholders’ deficit $1.24M; new offering up to $0.51M authorized .Continues to depend on external capital.
Internal Controls/Disclosure ControlsNot discussed in prior press releases reviewed.Disclosure controls deemed not effective as of 3/31/21 .Remains an area to improve.

Management Commentary

  • “With our Twitter advertising deal, we go through a process to gain pre-approval for hemp companies prior to posting any Twitter ads… This creates a sustainable advantage because our WeedClub® Platform has one of the few legal and approved direct-to-consumer advertising channels.” – Evan Horowitz, CEO .
  • “We would be surprised if we did not have at least 10,000 subscribers by the end of the year.” – Evan Horowitz, CEO, on Membership Benefits Program .
  • On strategy and industry positioning (10-Q MD&A): WeedClub aims to be a trusted connector for the regulated cannabis industry, leveraging @420 and events to build community and monetization pathways .

Q&A Highlights

  • No earnings call transcript available for Q1 2021; therefore, no Q&A highlights or tone changes to report. We searched for “earnings-call-transcript” and found none in the period.

Estimates Context

  • Street consensus (S&P Global) for Q1 2021 revenue and EPS was unavailable for FMHS at time of analysis; our attempt to fetch S&P Global estimates returned an access/rate limit error, and no alternative coverage was evident. As a result, we cannot quantify beats/misses vs. consensus for Q1 2021 .

Key Takeaways for Investors

  • Early monetization is visible: Q1 revenue of $11,350 driven by Twitter affiliate ads and referral fees demonstrates a path to recurring revenue, albeit off a small base .
  • Subscription expansion opportunity: The Membership Benefits Program introduces a scalable, higher-visibility revenue stream if subscriber adoption meets (or approaches) the 10,000 target; pricing at $149 aims for broad accessibility .
  • Legal optionality: The arbitration award could become a material asset depending on profit-sharing outcomes determined by the court-appointed monitor; timing and accounting treatment remain uncertain .
  • Balance sheet constraints and financing risk: Zero cash at quarter-end and a persistent stockholders’ deficit necessitate external financing; the $0.51M authorized offering is critical to sustain operations near-term (going concern) .
  • Execution focus: Scaling ad demand, converting Membership Benefits sign-ups, and improving disclosure controls are key operational milestones to watch over the next 1–2 quarters .
  • Absence of guidance/call: Lack of formal guidance and no call transcript reduce visibility; investors should monitor subsequent disclosures for quantitative updates on subscribers, ad pipeline, and legal recoveries .

Sources

  • Q1 2021 8-K and Press Releases: Q1 10-Q filing news and Twitter ad revenue gains ; WeedClub Membership Benefits Program launch and subscriber target .
  • Q1 2021 10-Q: Financial statements, revenue disaggregation, liquidity, going concern, arbitration award, controls .
  • FY 2020 8-K/Press: 10-K filing and litigation update context .

Additional Notes

  • We searched for prior two quarters’ earnings materials (8-K 2.02 and transcripts) for Q4 2020 and Q3 2020 and found none; trend analysis is therefore based on Q1 2020 comps and FY 2020 disclosures where applicable.
  • No earnings call transcript was found for Q1 2021.
  • S&P Global consensus estimates were unavailable for Q1 2021, limiting comparison versus Street expectations.