Reborn Coffee, Inc. (REBN)·Q4 2023 Earnings Summary

Executive Summary

• Q4 2023 revenue was $1.80M, up 109% year over year; company‑operated store gross margin expanded 710 bps to 73.2%, and Q4 net loss was $1.0M (slightly improved vs $1.1M in Q4 2022) .
• Balance sheet actions: two investments totaling $2.0M and a $1.0M debt‑to‑equity conversion during Q4; subsequently closed an additional $1.0M private placement on Feb 29, 2024 to fund expansion and working capital .
• No formal numeric guidance; management outlined aggressive U.S. and international store opening milestones and ecommerce expansion initiatives (Amazon/Hour Loop) .
• Ongoing listing/go‑concern risks are a stock narrative driver: Nasdaq delisting concerns disclosed in prior filings and an explicit “ability to continue as a going concern” risk factor reiterated in Q4 press materials .

What Went Well and What Went Wrong

What Went Well

• Record quarterly growth and margin execution: “record revenue growth, improving margins… drove fourth quarter store margins up 710 basis points to 73.2%” — Jay Kim, CEO .
• International and partnership momentum: Grand opening of flagship at Exchange TRX in Kuala Lumpur; partnership progress to establish first UAE location in Abu Dhabi; TOUS les JOURS Valentine’s blend and expanded ecommerce via Amazon/Hour Loop .
• Capital structure strengthened: Two investments totaling $2.0M, $1.0M debt converted to equity in Q4; additional $1.0M private placement closed Feb 29, 2024 to support U.S./international expansion .

What Went Wrong

• Profitability remains negative: Q4 net loss of $1.0M; total operating costs rose 39% YoY to $2.8M driven by growth initiatives and public‑company costs .
• Liquidity pressure: Cash declined to $0.68M at year‑end and FY cash used in operations was $2.79M, highlighting funding needs for expansion .
• Heightened risk disclosures and listing status: Forward‑looking statements emphasize go‑concern uncertainty; prior 10‑Q detailed Nasdaq delisting notifications and reverse split authorization to regain compliance .

Financial Results

Segment breakdown (stores vs wholesale/online):

KPIs:

Notes:

• Q4 store/wholesale revenue breakout was not disclosed; FY mix is provided .
• Q4 diluted EPS was not disclosed; FY 2023 loss per share was $(0.30) .

Guidance Changes

Earnings Call Themes & Trends

No Q4 2023 earnings call transcript was available in the document set. Themes below reflect MD&A and press releases.

Management Commentary

• “The fourth quarter of 2023 was highlighted by record revenue growth, improving margins… fourth quarter store margins up 710 basis points to 73.2%.” — Jay Kim, CEO .
• “Grand opening of a new flagship store… at the Exchange TRX mall in Kuala Lumpur… anticipated to significantly augment revenue streams.” .
• “Two investments totaling $2.0 million… and exchanged debt for equity… reducing our debt by $1.0 million.” .
• “Open up to 20 company‑owned retail locations… up to 20 franchised locations… 10+ overseas locations… target countries such as South Korea, Malaysia, Dubai…” .

Q&A Highlights

No Q4 2023 earnings call transcript or Q&A was available in filed documents for REBN during the period reviewed.

Estimates Context

• Wall Street consensus (EPS/revenue) for Q4 2023 via S&P Global was unavailable due to data access limitations; as a result, a beat/miss assessment versus consensus cannot be provided at this time. Values retrieved from S&P Global would be shown here if accessible.*

Where estimates may need to adjust:

• With Q4 revenue at $1.80M and demonstrated store margin improvement to 73.2%, models focused on store‑level profitability and near‑term unit growth may need higher store margin assumptions and incremental contribution from international openings, offset by elevated OpEx and funding costs .

Key Takeaways for Investors

• Growth narrative intact: Q4 revenue +109% YoY to $1.80M with store margin improvement to 73.2% indicates healthier unit economics as scale builds .
• Liquidity is the near‑term swing factor: year‑end cash of $0.68M and FY operating cash use of $2.79M necessitate continued external funding to execute ambitious opening plans; subsequent $1.0M private placement provides a bridge but not a solution .
• Capital actions de‑risk balance sheet: $2.0M investments and $1.0M debt-to-equity conversion reduce leverage and support growth runway (positive for credit profile and vendor confidence) .
• International proof points emerging: Malaysia TRX flagship and UAE plans broaden TAM and brand recognition; monitor ramp‑up and AUVs to validate contribution .
• Listing/go‑concern overhang persists: prior Nasdaq communications and explicit risk language keep headline risk elevated; corporate actions (e.g., reverse split, capital raises) are key to narrative stabilization .
• Ecommerce and partnerships add optionality: Amazon/Hour Loop and TOUS les JOURS initiatives diversify revenue channels and marketing reach at relatively low capital intensity .
• Near‑term trading lens: expect stock sensitivity to funding updates, store opening cadence, and any listing‑compliance developments; margin prints like Q4’s 73.2% can be a positive catalyst if sustained amid OpEx discipline .

Sources Read in Full

• Q4 2023 8‑K Item 2.02 with Exhibit 99.1 press release and FY 2023 financial statements .
• Q3 2023 10‑Q (for prior‑quarter trend) .
• Q2 2023 10‑Q (for prior‑quarter trend) .
• Subsequent event press/8‑K (Feb 29, 2024 $1.0M private placement) .