SBIG Holdings, Inc.

SpringBig reported Q4 2023 revenue of $6.8 million, up 1% year over year and down 1% sequentially. FY2023 revenue was $28.1 million, up 5% year over year, with subscription revenue up 14% to $22.3 million. Q4 gross profit was $4.8 million with a 70% margin; full-year gross profit was $21.6 million with a 77% margin, up from 75% in 2022. Q4 adjusted EBITDA loss was $0.2 million versus $3.2 million last year, and FY2023 adjusted EBITDA loss was $3.6 million versus $12.6 million in 2022. Full-year operating expenses were $29.9 million, down 17% year over year, and free cash flow for FY2023 was negative $3.2 million. For Q1 2024, management guided to revenue of $6.4 million to $6.7 million and adjusted EBITDA profit of $0.2 million to $0.4 million. For FY2024, it guided to revenue of $29 million to $32 million and adjusted EBITDA profit of $3.5 million to $5.0 million.

Jeff Harris struck an upbeat tone, saying SpringBig is “in an excellent position” and that the company is making the right investments to create client value while capturing long-term opportunity. He emphasized the shift toward more predictable subscription revenue, the launch of new offerings like VIP subscriptions and gift card payments, and expansion beyond cannabis into other regulated industries. He also framed 2024 as an execution year focused on product rollout, subscription growth, and disciplined expense control to deliver meaningful adjusted EBITDA.

Paul Sykes focused on the financial turnaround and balance-sheet repair. He highlighted the $8 million debt financing, including a $6.4 million 8% secured convertible note and a $1.6 million 12% secured term loan, both maturing in 2026 with no amortization, and said net proceeds after repurchasing the prior note and transaction costs were $4.6 million. On the P&L, he cited FY2023 revenue of $28.1 million, gross profit margin of 77%, operating expenses of $29.9 million, and an adjusted EBITDA loss of $3.6 million; he also noted Q4 operating expenses fell 31% year over year to $6.9 million. He said the current annual run rate should lead to about a 30% year-over-year reduction in operating expenses in 2024 versus 2023.

Analysts pressed on why Q1 guidance implies softer revenue and whether the second half of 2024 should ramp more strongly. Management said Q1 is pressured by seasonality and ongoing macro weakness, while second-half acceleration should come from normal seasonality plus newer products, especially VIP subscriptions and the gift card payment option. Questions also focused on client churn, bad debt, and payment terms; management said it added 396 new clients in 2023, but still sees too much churn among smaller customers and has largely transitioned those clients to prepay before usage. On non-cannabis, management said there are about 10 contracts already generating revenue and that a POS integration is driving some Q1 2024 acceleration.