1606 Corp. Reports Reduced Net Losses and Focus on AI Chatbot Development

1606 Corp. reported its financial results for the third quarter and the nine months ended September 30, 2025, revealing a significant reduction in net losses compared to the same period in the previous year. The company recorded a net loss of $384,516 for the three months ended September 30, 2025, a decrease from a net loss of $3,569,636 in the same quarter of 2024. For the nine-month period, the net loss was $802,966, down from $4,195,265 in the prior year. The reduction in losses was primarily attributed to a substantial decrease in operating expenses, which fell to $111,446 for the third quarter of 2025 from $3,246,179 in the same quarter of 2024, largely due to the absence of stock-based compensation expenses that had previously inflated costs.

The company did not generate any revenue during the three and nine months ended September 30, 2025, consistent with the previous year. In the nine months ended September 30, 2024, 1606 Corp. reported revenue of $7,195 from consulting services. The absence of revenue reflects the company's ongoing transition towards its new business model focused on AI chatbot technology for the CBD industry and public companies. The company has been developing its proprietary chatbot, ChatCBDW, which is designed to enhance customer engagement and sales for CBD retailers.

In terms of operational developments, 1606 Corp. has made strides in its strategic initiatives, including the launch of its AI chatbot in partnership with Cool Blue Distribution. This partnership aims to expand the company's reach within the CBD market. The chatbot, which integrates with Microsoft Azure and utilizes OpenAI's ChatGPT technology, is expected to provide product recommendations and analytics to improve inventory management for clients. The company is actively pursuing a subscription-based model for its chatbot services, targeting CBD brands and retailers.

As of September 30, 2025, 1606 Corp. reported total assets of $14.6 million, up from $10.1 million at the end of 2024. However, total liabilities also increased significantly to $2.9 million from $2.2 million, primarily due to a rise in convertible notes and derivative liabilities. The company’s stockholders’ deficit widened to $2.9 million from $2.2 million, reflecting ongoing financial challenges. The company has indicated that it may need to raise additional capital to sustain operations and achieve profitability, raising concerns about its ability to continue as a going concern.

Looking ahead, 1606 Corp. is focused on expanding its customer base for the ChatCBDW bot and is exploring additional equity financing options to support its operations. The company aims to secure recurring revenue through monthly licensing fees for its chatbot services. However, management has acknowledged the uncertainties surrounding its ability to achieve profitable operations in the near term, emphasizing the need for effective capital management and revenue generation strategies to ensure the company's viability.