Vinco Ventures (BBIG) releases Q3 Earnings; Reports $171m stockholder’s deficit

Vinco Ventures Global Technologies (NASDAQ: BBIG) released its third-quarter earnings after the market closed on Monday. Earlier, it had announced a joint venture of Cryptyde Inc. (its spin off subsidiary) focusing on Bitcoin mining.

Here is an overview of the latest disclosure.

  • Revenue: $2.2 million
  • EPS: -$7.09
  • Net Income: -$542 million
Source: Vinco ventures Investor relations

For the nine months ended September 30, 2021, Vinco Ventures’ operations lost approximately $40 million of which approximately $21 million was non-cash and approximately $6.5 million was related to transaction costs and other non-recurring items.

At September 30, 2021, the total current assets of approximated at $174 million and current liabilities of approximated to $37 million resulting in working capital of approximately $137 million, of which $28,481,485 was convertible notes payable. At September 30, 2021, we had total assets of $336 million and total liabilities of $508 million of which $468 million was related to the warrant liabilities, resulting in stockholders’ deficit of $171,999,206.

The Company received proceeds of $45,959,160 from sale of our securities subsequent to September 30, 2021.

Earnings Call
Highlights
  • Cash, cash equivalents, and restricted cash totaled $149.9 million at September 30, 2021.
  • Revenue decreased 11.5% to $2.23 million from $2.52 million in the third quarter of 2020, driven primarily by the decrease in sales of personal protective equipment in the Edison Nation Medical division.
  • Gross profit margin decreased to 31.4% from 40.3% in the third quarter of 2020. The decrease is mainly attributed to the decrease in sales of personal protective equipment in the Edison Nation Medical division.
  • Selling, general and administrative expenses were $25.9 million, of which $6.2 million was stock based compensation, $5.6 million was due to legal and professional fees related to transactions and filings, and $5.1 million and $6.2 million related to the operating expenses (excluding Stock Based Compensation) of ZVV and Lomotif, respectively, since the close of the Lomotif transaction on July 23, 2021.
  • Net loss in the third quarter of 2021 was $542.5 million, or ($7.59) per basic and diluted share, compared to a net loss of $2.8 million, or ($0.30) per basic and diluted share in the third quarter of 2020. The increase in the net loss is primarily due to the issuance of warrants during the quarter and the change in estimated fair value of outstanding warrants as of September 30, 2021, as well as the costs associated with the Lomotif transaction and the results of its operations, which were consolidated into the Company’s financial results for the first time this quarter. On a non-GAAP basis, net loss for the three months ended September 31, 2021 without the $494.1 million of losses due to warrant activity was $48.4 million or ($0.68) per share. See below for reconciliation of Non-GAAP information to the most comparable measure calculated under U.S. generally accepted accounting principles (“GAAP”).
Subsidiaries

As of September 30, 2021, Vinco Ventures wholly-owned subsidiaries included:

  • Cryptyde, Inc. (“Cryptyde”),
  • Cryptyde Shared Services, LLC (“Cryptyde Shared”),
  • CW Machines, LLC (“CW”), TBD Safety, LLC (“TBD”),
  • Vinco Ventures Shared Services LLC (“Vinco Shared”),
  • Ferguson Containers, Inc. (“Fergco”),
  • CBAV1, LLC (“CB1”),
  • Pirasta, LLC (“Pirasta”),
  • Honey Badger Media LLC (“Honey Badger”),
  • EVNT Platform LLC (“Emmersive Entertainment”)
  • Edison Nation Holdings, LLC

Edison Nation Holdings, LLC is the single member of Edison Nation, LLC and Everyday Edisons, LLC. Edison Nation, LLC is the single member of Safe TV Shop, LLC. Vinco Ventures owns a 50% voting membership interest in ZVV Media Partners, LLC (“ZVV”), 50% of Best Party Concepts, LLC and 50% of Global Clean Solutions, LLC, all of which are consolidated as VIE’s with noncontrolling interests. ZVV owns 80% of Lomotif Private Limited (“Lomotif”). Lomotif owns 100% of Lomotif, Inc.

CEO’s message

“We are very pleased with our operational developments in the quarter, which included key building blocks of our strategy to create a global media and content platform. Importantly, through our joint venture, ZVV Media, we completed the acquisition of an 80% interest in Lomotif, a global, pure play video-sharing social networking platform and we are making good progress on extending the brand to additional geographies, including the U.S. and India. We also announced the planned spin-off of our blockchain business, Cryptyde”

– said Lisa King, Chief Executive Officer of Vinco Ventures
Analysts Estimate

The Zacks Investments Research and Wall street analysts had no estimations for Vinco Ventures’ third quarter results.

Earnings History

BBIG reported second quarter earnings for FY21 on August 23, 2021. The reported loss per share was $0.23, however, it showed a huge growth of 81% quarter-over-quarter. However, the GAAP EPS (Earnings Per Share) was $4.67, much higher than the reported figure. Also, it showed a huge growth of 82.4% than the previous quarter’s GAAP EPS of $0.82. The reported revenue was $2.69 million which showed a mere 4.46% increase quarter-over-quarter.

The company reported first quarter earnings for FY21 on May 25, 2021. The reported loss per share was $1.23, which it showed a huge decline of 310% quarter-over-quarter. However, the GAAP EPS (Earnings Per Share) was $0.82, which was higher than the reported figure. Also, it showed a whopping growth of 373.3% than the previous quarter’s GAAP loss per share of $0.30. The reported revenue was $2.57 million which showed a huge decline of 39.5% from the FY20’s fourth-quarter revenue if $4.25 million.

Should you Invest in it?

Since the company has been repeatedly reporting losses, its stock prices are low. Therefore, it is the right time to invest now as its situation is going to be reversed really soon. With a bullish approach investor’s can gain a lot of profit, since the times are going to change now.

One of the most important reasons is that the Lomotif app is gaining immense popularity recently. This app was acquired by Zash and BBIG in July 2021. It is one of the tip short video creator app in the world with millions of installations. In addition, its venture, Adrizer Acquisition should have brought in a critical amount of revenue.

Some analysts are estimating BBIG stock prices to go up till $40. However, it was priced at $3.91 and is up by 2.72%, a few hours before the last trading session ended. At the end of market hours, it was diced to $3.91, up by 1.30%. The current market capitalization is valued at $486 million. Today, it touched its peak of $4.26, which shows its bullish approach. It might achieve analysts’ set target in the near future.

Bitcoin Venture Spin

Vinco Ventures, Inc. announced on November 1, 2021 that its spin off subsidiary Cryptyde launched a joint venture, CW  Machines, in accordance with Wattum management. Wattum is a leading international supplier of BTC mining equipments and services.

“The launch of this joint venture entity signifies the start of our expansion into the broader crypto and blockchain market. We are excited to be working with industry vetarans such as the Wattum Management team and and look forward to the introduction of NFT’s and smart contracts into the BTC Mining space.”

– said Cryptyde CEO Brian McFadden

CW Machines LLC’s operations launched with an initial order of 2000 Bitmain Antminer S19’s paired with US based power allocations.

On November 8, 2021 it filed Form 10 for its venture which included the following clauses –

  • Distribution ratio in the spin-off is 1 share of Cryptyde common stock for every 10 shares of Vinco common stock.
  • Distribution is currently anticipated to be tax free.
  • Currently expected number of outstanding shares of Cryptyde common stock is approximately 19 million.

This venture is set to aid the company’s operations. This is because, cryptocurrencies and the largest crypto- Bitcoin, have almost become a household name. This can be understood by the fact that Bitcoin almost soared to $70,000 this month. Not only this many cryptos surged more than expected. Therefore, this business opportunity is set for a fruitful outcome.

It will be intriguing to see how the company is going to perform in the near future. Also, will it recover the losses it suffered or not.

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