Cuentas Inc. Reports Improved Net Loss of $2.916 Million for Nine Months Ending September 30, 2024

Cuentas Inc. reported a net loss of $2.916 million for the nine months ending September 30, 2024, a significant improvement compared to a net loss of $4.294 million during the same period in 2023. Total revenues for the current period were $676,000, down from $1 million in the previous year, primarily due to a substantial decrease in wholesale telecommunication services, which fell from $860,000 to $569,000. The company's gross loss also decreased from $247,000 to $84,000, reflecting a reduction in costs associated with revenue generation, which totaled $760,000 compared to $1.247 million in the prior year.

Cuentas has made strategic adjustments to its operations, including a focus on reducing operating expenses, which totaled $1.561 million for the nine months ended September 30, 2024, down from $3.512 million in the previous year. This reduction was largely attributed to decreased officer compensation and a significant cut in professional services and marketing expenses. The company has also recorded a gain of $682,000 from changes in the fair value of derivative warrants liability, which contributed to offsetting some of the losses incurred.

Operationally, Cuentas has faced challenges, including a decline in customer engagement and product adoption rates. The company reported a decrease in sales of digital products and General-Purpose Reloadable Cards, which fell from $83,000 to $81,000. The company’s cash position remains precarious, with only $15,000 in cash and cash equivalents as of September 30, 2024, and a working capital deficit of $2.7 million. This financial strain raises concerns about the company's ability to continue as a going concern without securing additional financing.

In terms of strategic developments, Cuentas has entered into a joint venture with World Mobile Group Ltd. to enhance its service offerings and expand its market reach. The partnership aims to integrate Cuentas' fintech services into World Mobile's app, potentially increasing customer engagement and service utilization. Additionally, the company has liquidated its interest in Brooksville Development Partners, LLC, which is expected to provide some relief to its financial obligations. However, the company continues to face significant liquidity challenges and is actively seeking capital to support its operations and growth initiatives.

Looking ahead, Cuentas management acknowledges the need for substantial additional investments to sustain operations and execute its business strategy. The company is focused on enhancing its digital product offerings and increasing sales through its distribution network, particularly targeting underserved communities. However, the ability to raise capital and achieve profitability remains uncertain, and the company has indicated that it may require further financing to navigate its current financial difficulties.