Capstone Companies Reports Zero Revenues and Strategic Shift in Q1 2025

Capstone Companies, Inc. reported a significant decline in financial performance for the first quarter of 2025, with net revenues dropping to zero from $5,450 in the same period last year. The company attributed this decrease to the absence of an operating product line, following the liquidation of its Smart Mirror inventory in 2024. The net loss for the quarter was approximately $111,079, a notable improvement compared to a net loss of $262,260 in the first quarter of 2024. This reduction in losses was primarily due to a substantial decrease in operating expenses, which fell to $106,795 from $238,435 year-over-year.

In terms of operational changes, Capstone has shifted its strategic focus towards developing a business line centered on health, fitness, and social activities (HFS). This pivot includes plans for a customer registration and management application for HFS facilities, as well as a licensing agreement for its Connected Chef product, a kitchen tablet designed for food preparation. The licensing agreement, executed on March 21, 2025, allows a UK-based company to promote and sell the Connected Chef, with Capstone receiving a fee of $15 for each unit sold. However, as of the filing date, no sales had been recorded under this agreement.

The company’s financial position remains precarious, with a working capital deficit of $252,253 and an accumulated deficit of $11,870,679 as of March 31, 2025. Capstone's cash balance increased to $28,224 from $15,850 at the end of the previous fiscal year, largely due to financing activities that provided $111,363 in working capital. However, the company continues to rely heavily on loans from related parties to sustain its operations, raising concerns about its ability to continue as a going concern.

Capstone's management is actively seeking alternative sources of liquidity, including potential partnerships and additional financing measures. The company has engaged Coppermine Ventures, LLC, which has provided funding to support basic operational expenses. The management team, now led by CEO Alexander Jacobs, is focused on identifying and developing new revenue-generating opportunities within the HFS sector. However, the company acknowledges that without securing additional funding or successfully launching new business lines, its financial viability may be at risk in the coming fiscal periods.