Farmhouse, Inc. Faces Financial Challenges Amid Strategic Shift and Upcoming Acquisition Deal

Company Overview: Farmhouse, Inc. (PINK: FMHS) is a technology business involved in multiple divisions and a portfolio of intellectual property, including the WeedClub® platform. The company has strategically shifted away from its NFT licensing business due to limited revenues.

Recent Developments: On September 10, 2024, Farmhouse signed a Share Exchange Agreement (SEA) with Thrown, LLC, to acquire its membership interests for 5,130,000 newly issued shares, representing approximately 25% of the company's outstanding shares post-transaction. This deal is still pending.

Income Statement Highlights:

• Q3 2024 Revenue: $0, down from $5,503 in Q3 2023.
• YTD Revenue (2024): $4,154, down from $10,707 in 2023, due to discontinuation of NFT licensing revenue.
• Operating Expenses for Q3 2024: $92,824, an improvement from $106,425 in Q3 2023.
• Net Loss for Q3 2024: $107,193, decreased from $116,358 in Q3 2023.
• Total Operating Loss YTD (2024): $321,456, improved from a loss of $402,746 in 2023.
• BASIC AND DILUTED NET LOSS PER SHARE: $0.01 for Q3 2024 (same as Q3 2023 for comparative purposes).

Balance Sheet Insights:

• Current Assets: $8,400 as of September 30, 2024, compared to $8,160 in December 2023.
• Total Liabilities: Increased to $2,282,379 from $1,986,441, primarily due to accruals of legal fees and payroll taxes.
• Stockholders’ Deficit: Expanded to $(2,247,804) from $(1,978,281), highlighting ongoing financial struggles.

Key Positive Aspects:

• Reduction in operating expenses YTD, indicates cost-control measures are being implemented effectively.
• Potential strategic growth through the acquisition of Thrown, if the transaction goes through.

Key Negative Aspects:

• Significant revenue decline due to the cessation of the NFT licensing initiative.
• Company faces a working capital deficit of $2,239,979, raising concerns over liquidity and ongoing operations.
• Multiple promissory notes are in default, which could hinder future financing options.

Financial Outlook: Farmhouse Inc. is actively seeking additional capital while addressing substantial operational challenges. The company’s future hinges on successfully securing financing and achieving revenue from potential acquisitions.