CV Sciences, Inc. reported a challenging financial performance for the three and nine months ended September 30, 2024, compared to the same periods in 2023. For the third quarter, product sales decreased to $3.865 million, down 5% from $4.089 million in Q3 2023. Gross profit for the same period was $1.778 million, a slight decline of 4% from $1.843 million. The nine-month figures also reflected a decrease in product sales to $11.821 million, down 3% from $12.203 million, although gross profit increased to $5.491 million, up 3% from $5.343 million.

The company reported a net loss of $456,000 for Q3 2024, compared to a loss of $447,000 in Q3 2023. For the nine months, the net loss significantly widened to $1.668 million from a net income of $3.971 million in the prior year. This decline was attributed to increased operational costs and a decrease in sales volume, with total units sold down 7.9% in Q3 and 11.8% for the nine months.

CV Sciences' total current assets decreased to $6.748 million as of September 30, 2024, from $7.938 million at the end of 2023. Total assets also fell from $9.200 million to $8.391 million during the same period. The company’s total stockholders' equity decreased to $2.191 million from $2.903 million, reflecting ongoing financial pressures.

Strategically, CV Sciences made two significant acquisitions: Cultured Foods Sp. z.o.o. on December 7, 2023, and Elevated Softgels LLC on May 13, 2024. These acquisitions aim to enhance growth opportunities in plant-based products and CBD distribution. However, both acquisitions included earn-out provisions that are unlikely to be triggered due to insufficient expected revenues.

The company faced liquidity concerns, relying on additional investment capital for operations and growth initiatives. In July 2024, CV Sciences secured a $900,000 loan through a Secured Promissory Note, which is set to mature in July 2025. The company also reported negative cash flows from operations of $697,000 for the nine months ended September 30, 2024, compared to a positive cash flow of $2.367 million in the same period of 2023.

Regulatory challenges also impacted the company, particularly an emergency order in California banning the sale of hemp products with detectable THC, which is expected to affect sales until March 2025. Overall, CV Sciences is navigating a complex landscape of declining sales, increased operational costs, and regulatory hurdles while pursuing strategic growth through acquisitions.