Paltalk (NASDAQ:PALT) Inc has announced that its cash position remains solid at $16.9 million at the end of June 2022, with the company seeking further strategic opportunities after successfully acquiring the assets of live streaming software and virtual camera ManyCam.
To that end, the communications software innovator has engaged Roth Capital Partners, LLC to assist with buy-side opportunities to accelerate its growth and profitability.
"We look forward to working with Roth Capital Partners in exploring strategic opportunities as we build upon our recently closed acquisition of the ManyCam assets,” Paltalk chairman and CEO Jason Katz said in a statement announcing the company’s second-quarter results.
“Our team is optimizing the ManyCam assets to maximize subscription revenue, integrate and cross-sell with existing customers and explore business-to-business sales opportunities. Since our launch of ManyCam, there have been over 300,000 new installs of the product and we believe, although early, this is a positive sign,” he added.
READ: Paltalk announces upgrade release of ManyCam version 8.0
Paltalk paid $2.9 million to acquire the core assets of ManyCam in June, and within days, launched version 8.0 with vast improvements over prior versions.
"We have continued to fine-tune our strategy to focus on Adjusted EBITDA optimization, the integration of the newly acquired ManyCam assets, and adjusting our spending to align with current macro-economic conditions. Our cash position as of June 30, 2022, remains solid at $16.9 million … we plan to continue to invest in a measured way with responsible cash management," Katz said.
Paltalk posted three months to June 30, 2022, revenue of $2.6 million, compared to $3.4 million in the year-ago period as the weak macroeconomic environment, as well as lower revenue from technology services, resulted in an 18% drop in subscription revenue. Advertising revenue rose by over 11% to $0.1 million, it noted.
Net loss totaled $1.1 million, compared to net income of $0.8 million from a year earlier, while adjusted EBITDA fell by $1.6 million to negative $0.9 million, compared to adjusted EBITDA of $0.7 million for the three months ended June 30, 2021.
"Although disappointed with the results, our goal is to get back to profitability,” CEO Katz said. “While a portion of our strategy will come from the streamlining of expenses, we believe enhancements to our live video chat applications, ManyCam sales and cross sales, integration of games and our focus on retention and monetization has the potential to increase revenue opportunities. We plan to continue to develop our consumer application platform and defend our intellectual property as we seek to build stockholder value.”
The company currently has no long-term debt on its balance sheet.
“We feel there are multiple ways to expand our communications software and multimedia social applications, which we believe have the potential to provide substantial value to Paltalk stockholders. Our Nasdaq listing status, strong cash position and current operating business strategy provide us a strong platform to execute our strategic plan to acquire additional complementary and synergistic businesses," added Katz.
On its patent infringement lawsuit filed in 2021 against WebEx Communications, Inc., Cisco WebEx LLC, andf Cisco Systems Inc (NASDAQ:CSCO). in the US District Court for the Western District of Texas, Paltalk said a trial has been scheduled for February 2023.
Contact the author at jon.hopkins@proactiveinvestors.com