Bespoke Extracts, Inc. reported significant financial developments in its 10-Q filing for the period ending June 30, 2024. The company, which operates in the regulated cannabis markets through its subsidiary, Bespoke Extracts Colorado, LLC, experienced a notable increase in sales, with revenues for the three months ending June 30, 2024, reaching $278,163, up from $188,247 in the same period of 2023. For the six months ended June 30, 2024, total sales amounted to $538,591, compared to $277,263 in the prior year.

Despite the revenue growth, the company reported a net loss of $260,895 for the three months ended June 30, 2024, an improvement from a loss of $464,915 in the same period of 2023. For the six months, the net loss was $575,013, down from $905,535 in the previous year. The loss per share also improved, with a loss of $0.03 per share for the three months ended June 30, 2024, compared to $0.05 per share in 2023.

Bespoke Extracts' gross profit for the three months ended June 30, 2024, was $106,117, up from $71,036 in the same period of 2023. However, selling, general, and administrative expenses decreased to $325,885 from $457,366 year-over-year, contributing to a reduction in total operating expenses from $538,538 to $356,360.

The company’s financial position showed improvements in cash reserves, with cash increasing to $24,791 as of June 30, 2024, from $1,947 a year earlier. Total current assets rose to $133,549, compared to $81,839 at the end of 2023. However, total liabilities also increased significantly to $2,539,614 from $2,078,917, leading to a total stockholders’ deficit of $(2,172,137) as of June 30, 2024, compared to $(1,724,557) at the end of 2023.

Strategically, the company completed the acquisition of WonderLeaf assets on January 3, 2023, for 222,223 shares of common stock valued at $50,000. This acquisition was classified as an asset purchase, with no goodwill recorded. The company continues to face challenges, including a working capital deficit of $1,439,890 and negative cash flows from operations, raising substantial doubt about its ability to continue as a going concern.

Management has acknowledged weaknesses in its internal controls, particularly due to the dual role of the CEO as the principal financial officer, which may hinder the identification of errors in financial statements. The company plans to address these issues by enhancing its financial personnel capacity.