Interactive Strength (TRNR) - 2025 Q1 - Quarterly Report

Revenue Performance - Total revenue for Q1 2025 reached $1,356,000, a significant increase from$363,000 in Q1 2024, representing a growth of 273%[11] - Fitness product revenue surged to $1,050,000 in Q1 2025, compared to$53,000 in Q1 2024, marking an increase of 1,877%[11] - Membership revenue increased to $176,000 for the three months ended March 31, 2025, up from$155,000 in the prior year, reflecting a growth of 13.5%[70] - Training revenue decreased to $130,000 for the three months ended March 31, 2025, down from$155,000 in the same period of 2024, indicating a decline of 16.1%[70] - Woodway, the exclusive distributor, represented 71% of the Company's total revenue for the three months ended March 31, 2025[206] Financial Losses and Improvements - The company reported a gross loss of $304,000 in Q1 2025, an improvement from a gross loss of$1,200,000 in Q1 2024[11] - The net loss attributable to common stockholders for Q1 2025 was $6,603,000, compared to a net loss of$11,394,000 in Q1 2024, indicating a 42% improvement[11] - The net loss for the three months ended March 31, 2025, was $6.603 million, a decrease from a net loss of$11.394 million in the same period of 2024, indicating an improvement of 42%[54] - The company reported a net loss of $6,603,000 for the quarter ending March 31, 2025[16] Operating Expenses and Cash Flow - Total operating expenses decreased to$6,008,000 in Q1 2025 from $8,241,000 in Q1 2024, reflecting a reduction of 27$3.5 million for the three months ended March 31, 2025, compared to $2.96 million in the prior year, reflecting ongoing operational challenges[17]. - The company reported a net cash provided by financing activities of$7.77 million during the reporting period, indicating successful capital raising efforts[17]. Assets and Liabilities - Cash and cash equivalents increased to $2,207,000 as of March 31, 2025, up from$138,000 as of December 31, 2024[9] - Total assets grew to $37,816,000 as of March 31, 2025, compared to$34,170,000 as of December 31, 2024, representing an increase of 8%[9] - Total liabilities decreased to $24,060,000 as of March 31, 2025, down from$27,055,000 as of December 31, 2024, a reduction of 11%[9] - The company has a significant accumulated deficit of $209.4 million as of March 31, 2025, highlighting ongoing financial challenges[33]. Stock and Equity Transactions - The weighted average common stock outstanding for basic and diluted was 3,804,106 shares in Q1 2025, compared to 4,249 shares in Q1 2024[11] - The company issued$1,500,000 in Series B preferred stock upon the acquisition of CLMBR, Inc.[15] - The issuance of common stock from the At the Market offering amounted to $1,594,000[15] - The issued and outstanding common stock increased from 1,402,102 shares as of December 31, 2024, to 7,953,570 shares as of March 31, 2025[181] - The Company issued 821,500 shares of common stock from At the Market offering in February 2025[189] Debt and Financing - The company incurred a total outstanding debt of approximately$10.9 million as of the issuance date, with about $9.0 million scheduled to mature over the next twelve months[33]. - The Company entered into a Term Loan agreement for approximately$8.0 million, with a guarantee fee of $2.3 million due at maturity, and the outstanding principal amount was approximately$5.0 million as of April 24, 2024[82][84] - The carrying value of the Term Loan as of March 31, 2025, was $3.289 million, with total interest expense recognized of$60,000 for the three months ended March 31, 2025[91] - The Company recorded a debt discount of $2.0 million and incurred$0.3 million of debt issuance costs related to the January 2025 Convertible Notes, which will be amortized over the life of the notes[114] Legal and Compliance Issues - The Company has received two notices from Nasdaq regarding noncompliance with listing requirements, but has since regained compliance with both the minimum stockholders' equity and publicly held shares requirements[38] - The Company is subject to a Mandatory Panel Monitor for one year following compliance with Nasdaq rules, which could lead to delisting if future compliance is not maintained[38] - The Company is involved in legal proceedings with a potential liability of $2.2 million related to a breach of contract claim[179] Accounting and Reporting Changes - The Company has adopted ASU 2023-07 for segment reporting, enhancing disclosures about significant segment expenses, effective for the 2024 annual period[48] - The Company is currently evaluating the impact of new accounting standards, including ASU 2020-04 and ASU 2022-06, but does not expect them to have a material impact on financial statements[49]