- Creatd's 2022 gross revenues totaled $10MM, a 40% increase YoY, while facing the most significant headwinds in Company's history.
NEW YORK, Feb. 6, 2023 /PRNewswire/ -- Creatd, Inc. (OTCQB: CRTD) ("Creatd" or the "Company"), a creator-first technology company, today announced the preliminary results for fiscal year 2022.
Preliminary Fiscal Year 2022 Financial Results
The Company's preliminary results for fiscal year 2022 include expected net revenues of nearly $5 million, and gross revenues totaling approximately $10 million, in line with previous guidance. Deferred revenue is expected to total near $275,000, up from $71,000 reported in the third quarter.
As of year-end 2022, the Company has greatly strengthened its balance sheet, and significantly reduced its operational expenses, keeping a steady eye toward reaching increasingly tight cost controls and cash flow breakeven. Last year, the Company allocated considerable focus toward optimizing and reducing its marketing expenditure by 55% year-over-year while scrutinizing many of the contributing expenses within general & administrative processes. In the second half of the year, the Company reduced its workforce by 60%, lowering payroll by approximately 40% in the fourth quarter alone. In addition, the Company integrated back office operations and reorganized future expenses. The Company's Cost of Goods Sold was also reduced quarter over quarter by over 20%.
- Creatd announced and began executing on a plan to spin-off its media asset library and Web 3.0 business, OG Collection, Inc., to shareholders, beginning with a forthcoming application to list the subsidiary on Upstream; the listing will be followed within approximately 90 days with a dual-listing on the OTC or a national exchange. These actions are expected to force a full count of shares in the marketplace, as the spin-off is limited to physical shareholders as of a to-be-announced record date.
- Creatd's management team and board of directors have worked together to approve and assemble an investigative team of experts and data analytics groups to advise on what legal actions can be taken against what it believes to be abusive and illegal trading activity in its underlying stock. The Company believes these damages could be considerable and has engaged specialized legal counsel.
- Creatd successfully applied for dual listing on Upstream, as part of a broader effort to reach an international shareholder base, grow awareness, and curtail naked short selling.
- The Company intends on preparing the Creatd Ventures business division, the Company's CPG/DTC acquisition vehicle, to be spun-off to its shareholders. Similarly to the OG Collection, Inc. spin-off, Creatd Ventures will only be spun-off to shareholders as of a to-be-announced record date.
- The Company appoints Robby Tal, an eight-year Creatd veteran and creator of the Company's business intelligence group, to the C-Suite in the capacity of Chief Information Officer (CIO). He will be tasked with overseeing scale and growth for revenue-generating arms of the Company including Vocal, Vocal for Brands, which recently completed the absorption of all influencer agency operations, and Creatd Ventures.
- Collaborating closely with Mr. Tal is Justin Maury, the Company's Chief Operating Officer, who will additionally hold the title of CEO of Creatd Ventures as the Company continues to streamline Creatd Ventures' managerial structure and prepare for spin-off of the subsidiary.
- The most notable development milestone last year for the Company's flagship product, Vocal—the home base for global creators—was the launch of the Vocal app on iOS and Android as well as significant product updates.
- Vocal is now a direct competitor to Substack, Patreon, and Medium, all recently valued in the private sector at between $500 million to $1 billion.
- Vocal for Brands agency continues to grow its average contract value, recently signing its first near-million-dollar campaign with Ollie Pets, Inc., the subscription-based pet food company. Additionally, 2022 saw the launch and completion of successful campaigns with brands including National Geographic, Dune, and WeightWatchers, as well as continued growth within our existing base of clientele.
- Creatd Ventures continues to grow its external partnerships with retailers and wholesalers, having entered into collaboration agreements for online features, in-store pop-ups, and other events, with the likes of Bloomingdales, Citarella, Erewhon, Equinox, Foxtrot, GoPuff, Amazon, and Urban Outfitters. Additionally, the business has secured placement for some of its highly-regarded wellness products with subscription box brands such as Vegancuts and Urthbox.
Jeremy Frommer, Creatd's founder and CEO, commented, "We are pleased to have begun the new year with a highly consolidated management structure, which we have found to be most efficient and cost-effective while still yielding continued growth in revenues. Robby's addition to our C-Suite as CIO considerably bolsters our executive team's collective capabilities and will serve as an important complement to Chelsea Pullano, multi-year CFO, and Justin Maury, our COO and trusted product visionary. Further supporting this powerhouse group is the support of Pete Majar–a structured products expert who hails from institutions including Credit Suisse First Boston and Piper Sandler, and literary expert Erica Wagner, the writer and critic and former literary editor of The London Times, who has grown to be an instrumental part of our firm's content development and monetization. We expect this tight management structure to translate and a unique product and service offering to translate into similar revenue growth in 2023 as we saw in 2022."
Forward Looking Statements
Any statements that are not historical facts and that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, indicated through the use of words or phrases such as "will likely result," "are expected to," "will continue," "is anticipated," "estimated," "intends," "plans," "believes" and "projects") may be forward-looking and may involve estimates and uncertainties which could cause actual results to differ materially from those expressed in the forward-looking statements. We caution that the factors described herein could cause actual results to differ materially from those expressed in any forward-looking statements we make and that investors should not place undue reliance on any such forward-looking statements. Further, any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. New factors emerge from time to time, and it is not possible for us to predict all of such factors. Further, we cannot assess the impact of each such factor on our results of operations or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. This press release is qualified in its entirety by the cautionary statements and risk factor disclosure contained in our Securities and Exchange Commission filings.