Rivulet Entertainment Reports Increased Net Loss and No Revenue for Q3 2024

Rivulet Entertainment, Inc. reported a net loss of $603,364 for the three months ended September 30, 2024, a significant increase from the net loss of $95,004 recorded in the same period of the previous year. The company did not generate any revenue during this quarter, maintaining a consistent trend from the prior year. Operating expenses surged to $496,578, compared to $102,764 in the previous year, primarily driven by increased general and administrative costs. The company’s cash position decreased to $79,049 from $101,721 at the end of the previous quarter, reflecting a net cash outflow of $963,736 from operating activities.

The financial results reflect the impact of a reverse merger completed in July 2024, which involved the acquisition of certain subsidiaries of Rivulet Media, Inc. This transaction resulted in a recapitalization that increased the number of shares outstanding to 109,695,876 as of September 30, 2024, up from 96,722,950 shares at the end of June 2024. The merger also led to the forgiveness of approximately $8.1 million in related party debt, which was recognized as an increase in additional paid-in capital.

Operationally, Rivulet Entertainment is focused on producing feature-length films and television content, with a strategy that emphasizes cost control and securing favorable financing opportunities. As of September 30, 2024, the company reported total film costs of $10,853,037, which includes $9,886,289 for completed but unreleased films. The company has not disclosed specific customer counts or engagement metrics, but it aims to leverage contracts with well-known actors and appealing scripts to attract larger audiences.

Looking ahead, Rivulet Entertainment faces challenges related to its liquidity and capital resources, with negative working capital of $9.7 million and a stockholders' deficit of $1.2 million. The company has indicated that it will need to raise additional capital to fund ongoing film production activities. Management has expressed concerns about the company's ability to continue as a going concern, emphasizing the need for future sales of movie rights and capital raises to mitigate these risks. The company is also exploring opportunities for geographic expansion and diversifying its content portfolio to enhance its competitive position in the industry.