California-based WM Technology Inc., better known as Weedmaps, (Nasdaq: MAPS) shrank its losses to $3.9 million for the first quarter of 2023, from more than $31 million lost in the first quarter a year ago, while also increasing its client base by 12% compared to the same time period.
Weedmaps’ monthly paying client list increased to 5,641 from 5,026 in the first quarter 2022, the company reported, but average monthly revenue per client plunged 25% from a year ago, to $2,837.
But getting financial losses under control – following total losses of nearly $83 million last year – was enough for Executive Chairman Doug Francis to say he was “pleased” with the first quarter of 2023.
The Q1 losses of just under $4 million “reflect the strategic actions we have taken since November to improve our bottom line,” Francis said in a press release.
Weedmaps not only had two rounds of layoffs last year, but longtime CEO Chris Beals also stepped aside in November, which is when Francis took the reins and began focusing on a return to profitability.
“Our continued focus on our marketplace experience and commitment to delivering value to our clients is generating business stability despite end markets that remain challenged,” Francis said, adding that the company’s balance sheet remains “as strong as it’s been in some time,” with $25.9 million in the bank and no long-term debt.
Francis also noted that the recent April 20 holiday, following the end of the first quarter, was a boon to Weedmaps, with a record-breaking number of online orders placed with dispensary partners, according to the company.
Still, Weedmaps is carrying $190 million in total liabilities, the company reported, with the same amount in total assets. Revenues were down year-over-year for Q1 by 16%, to $48 million from $57.4 million a year ago, but operating expenses also were slashed under Francis’ watch by 27%, to $52.1 million from $71.7 million a year prior.
According to guidance in the Q1 report, Weedmaps expects revenues to remain consistent with Q1 for the rest of the year.