Leafly (LFLY) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue was $8.7 million, down 18–19% year-over-year, with net loss narrowing to $1.3 million from $1.4 million, and adjusted EBITDA improving to $483,000–$0.5 million from $80,000–$0.1 million in Q2 2023.

• Gross margin increased to 89% from 88% in Q2 2023, and operating expenses were reduced by 17% to $8.4 million.

• Operational focus remains on efficiency, collections, and stabilizing the retail account base.

• Substantial doubt exists about the ability to continue as a going concern due to inability to repay $29.4 million in convertible notes maturing January 2025.

• Company is exploring financing and strategic alternatives, including an ATM equity offering and advisor engagement.

Financial highlights

• Retail revenue was $7.3 million; brand revenue was $1.4 million.

• Gross margin improved to 89% from 88% in Q2 2023.

• Operating expenses were $8.4 million, down 17% year-over-year.

• Adjusted EBITDA was $483,000–$0.5 million, up from $80,000–$0.1 million in Q2 2023.

• Cash and equivalents at quarter end were $13.6–$13.8 million, down from $15.3–$15.5 million at year-end 2023.

Outlook and guidance

• Q3 2024 revenue expected around $8.4 million, with adjusted EBITDA loss of less than $1 million.

• Management expects to realize the full-year impact of 2023 restructuring in 2024 and is focused on stabilizing revenues.

• Ongoing initiatives include hiring sales professionals, implementing new selling strategies, and product development.

• Company is actively seeking capital infusion or refinancing to address upcoming debt maturity.