HWH International Inc. Reports 52% Revenue Growth, Substantial Losses in Latest Quarter

HWH International Inc. reported significant financial changes in its 10-Q filing for the quarter ending September 30, 2024. The company, which operates in the food and beverage sector primarily in Singapore and South Korea, experienced a notable increase in revenue but also faced substantial losses.

For the three months ended September 30, 2024, HWH International Inc. generated total revenue of $345,523, a 52% increase from $226,907 in the same period of 2023. For the nine months ended September 30, 2024, total revenue reached $966,515, up from $622,667 in the prior year. The growth in revenue is attributed to the expansion of its food and beverage business, which accounted for 100% of revenue in both periods, compared to 98% in 2023.

Despite the revenue growth, the company reported a net loss of $(537,143) for the three months ended September 30, 2024, compared to a loss of $(156,131) in 2023. For the nine-month period, the net loss escalated to $(2,277,303), significantly higher than the $(47,217) loss reported in the same period of the previous year. The increase in losses is attributed to rising operating expenses, which totaled $(487,394) for the quarter, down from $(570,043) in 2023, but increased to $(2,637,517) for the nine months, compared to $(1,888,900) in 2023.

The company's financial position showed a drastic decline in total assets, which fell to $2,920,066 as of September 30, 2024, from $23,710,684 at the end of 2023. Current liabilities also decreased to $1,921,780 from $6,024,797. The accumulated deficit worsened to $(5,038,656) from $(2,765,403) as of December 31, 2023, while total stockholders’ deficit improved to $(374,893) from $(2,962,170).

Strategically, HWH International Inc. underwent a merger on January 9, 2024, which was accounted for as a reverse recapitalization. The merger consideration was valued at $125 million, consisting of 12.5 million shares of common stock. The company has also suspended its membership model, which previously contributed to revenue, pending restructuring.

In terms of cash flow, the company reported net cash used in operating activities of $(1,404,073) for the nine months ended September 30, 2024, an improvement from $(2,228,539) in 2023. Cash at the end of the period was $832,368, down from $1,159,201 at the end of 2023.

Overall, while HWH International Inc. has seen revenue growth, it continues to face challenges with profitability and asset management following its recent merger and operational restructuring.