TON Strategy Company - Earnings Call - Q1 2025

Transcript

Operator (participant)

Good evening and welcome to the first quarter of 2025 Financial Results Conference call for TON Strategy Company. At this time, all participants are in a listen-only mode. Please be advised the call is being recorded at the company's request. On our call today is Rory J. Cutaia, TON's founder, chairman, and CEO. Before we begin, I'd like to remind everyone that the statements made during this conference call will include forward-looking statements under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties that can cause actual results to differ materially. Forward-looking statements speak only as of the date they are made, except as required by law, as the underlying facts and circumstances may change.

Verb Technology Company disclaims any obligations to update these forward-looking statements, as well as those contained in the company's current and subsequent filings with the SEC. I would now like to turn the call over to Rory J. Cutaia, CEO. Rory?

Rory Cutaia (Founder, Chairman, and CEO)

Thank you, Moderator, and thanks to everyone for joining us today for our first quarter 2025 financial results and business update conference call. For those of you who have reviewed our 10-2 file this morning or the summarized results and the press release we issued this morning, you already know, right? You know the company is firing on all cylinders, and I'm talking about a 12-cylinder, finely tuned exotic sports roadster. Yeah, we had a crazy good quarter. This is the TON Strategy Company we've envisioned, and this is the TON Strategy Company we've manifested, and this is the TON Strategy Company we have worked so hard to deliver. The best part, the really best part is this is just the beginning. I've got to hand it to my management team. They never stopped believing through all the trials and tribulations, and we've had more than our share.

They stuck it out with me. We drew strength from one another, and no matter what, we never gave up. I appreciate them all so very much and our amazing, amazing board of directors. Now that we've begun to hit our stride, they're all feeling it. They know where we're taking this vehicle. For those of you listening to this who have stuck it out with us, and for those of you thinking about joining us, from here on out, it's going to be a fun ride. We're cashed up, zero debt, insanely undervalued, and each TON Strategy Company division is performing very, very well.

I'm not going to take your time reading the 10-2 or reiterating everything we discussed about the company just six weeks or so ago when we reported our 2024 results. I will definitely enjoy sharing some of our team's accomplishments in just the first three months of this year. All right, let's start with revenue. First, let me provide some context. In Q1 of 2024, we reported revenue of just $7,000. In Q4 of 2024, we reported revenue of $723,000. Definitely a great quarter, and the first full quarter after we instituted a number of changes to our business model. For the entirety of 2024, we reported a total of $895,000. In Q1 of 2025, we reported $1.3 million. That's 80% revenue growth over the prior quarter and approximately 46% growth over all four quarters of revenue of 2024 combined.

While we've been busy signing and launching a plethora of new clients, we identified what we believe is the hottest AI social commerce technology company in the market and negotiated the terms of an $8.5 million cash and stock acquisition, signed a comprehensive term sheet, and then rapidly drove the deal to a closing, all while actively integrating their AI technology into our own platform. We used about $4.2 million in cash in closing that acquisition. Look, I really liked having a very robust zero-debt cash-up balance sheet. Being opportunistic, we identified a funding opportunity with extraordinary shareholder-friendly terms, negotiated it, documented it, and closed it. A non-dilutive, non-convertible, non-voting preferred stock deal with just a 9% annual dividend. With that, we added $5 million back onto the balance sheet.

This deal is with a trusted financial partner with whom we've now done several very successful deals. I do feel sorry for other companies doing terrible, horrible financing, steep, steep discounts to market price, pre-funded warrants, triple warrant coverage, decimating cap tables, and rendering many of these companies unfinanceable going forward, who ultimately get shorted into oblivion. You see it every day. Tough times for a lot of companies, and I'm very grateful that we're in such a strong cash position and we've been able to maintain a super clean cap table, no warrants overhang, and a very tight float, and obviously not desperate to find the source of capital. In fact, with our cash on hand, no debt, and growing revenue across all business units, we expect to be able to fund operations easily, easily into 2028 and beyond.

As to the growth behind Market.live, we've signed many very high-profile clients and continue to do so. I've been asked, well, why aren't we announcing them? You'd have to do multiple times a month. The answer is most of these deals are where we're white-labeling our platform for these well-known brands, and our contract prohibits us from announcing the names. I wish I could. If I could, I doubt our stock would still be trading for 50% of our net cash with zero value given for all our business units. It's crazy. It's just crazy. I've also been asked why we don't see as many live streams on Market.live as we used to, and that's because our new technology allows us to stream directly from our clients' own websites and then multicast their streams across multiple social media channels simultaneously.

This is really the killer act, drawing so many more clients because it allows these brands to own and continue to own the customer relationship while still streaming over other social platforms. We are also seeing strong, strong growth in shoppable ads among many other areas of our Market.live and now LiveCom business units. Our telehealth platform, Bandicoot Stripe, and GoodGoRx continue to grow month over month, adding recurring subscription-based revenue. Our GoFundMe stuff, crowdfunding TV show, is developing an almost Hulk-like following, and more and more issuers are applying to be on the show. Fortune has now become much more selective and to accommodate demands. We are now streaming multiple episodes twice a month. Of course, issuers pay to be on the show. We are about to launch season two on Cheddar.

In closing, I refer you to our form 10-Q filed today for greater details concerning our Q1 2025 financial results, as well as the press release that we distributed today summarizing those results for additional information that I have not covered in my conference call today. Thank you. Thank you for your interest in TON Strategy Company and for taking the time to listen to our Q1 2025 financial results. I presume you can tell how excited we are about the business. We are really excited. Oh yes, I do indeed expect Q2 results to be even better than this Q1. Stand by.

Operator (participant)

Thank you. Ladies and gentlemen, this concludes the conference call. You may now disconnect your lines.