System1, Inc. reported its financial results for the three and nine months ended September 30, 2024, showing mixed performance compared to the previous fiscal period. For the third quarter, the company generated revenue of $88.8 million, a slight increase of 1% from $87.8 million in the same period of 2023. However, for the nine months ended September 30, 2024, total revenue decreased by 12% to $268.3 million, down from $305.9 million in the prior year.

The company's operating expenses for the third quarter rose to $110.6 million, compared to $108.7 million in the same quarter of 2023. For the nine-month period, total operating expenses decreased to $345.0 million from $372.8 million, reflecting a 7% reduction. Despite the decrease in expenses for the nine-month period, System1 reported an operating loss of $21.8 million for the third quarter, slightly higher than the $20.9 million loss in the same quarter of 2023. The nine-month operating loss also increased to $76.7 million from $66.9 million year-over-year.

Net loss from continuing operations for the third quarter was $30.6 million, compared to $25.9 million in the same period last year. However, the net loss for the nine months improved to $79.3 million from $85.8 million in 2023. Notably, the net loss attributable to System1, Inc. for the third quarter significantly decreased to $23.6 million from $131.5 million in the prior year, indicating a substantial improvement.

The company’s cash and cash equivalents as of September 30, 2024, were reported at $69.1 million, down from $135.3 million at the end of 2023. Total assets also decreased to $479.3 million from $605.5 million during the same period. The accumulated deficit grew to $(768.2 million) from $(707.7 million) at the end of 2023.

Strategically, System1 underwent a corporate reorganization effective August 1, 2024, consolidating its operations under System1 Holdings, LLC. The company also completed the sale of its Protected business on November 30, 2023, which has been reflected in its financial statements as a net loss from discontinued operations. Additionally, System1 is actively addressing material weaknesses in its internal controls over financial reporting, which have been identified as a significant concern.

Overall, while System1 experienced a slight increase in quarterly revenue, it continues to face challenges with profitability and cash flow management, alongside ongoing strategic adjustments and operational restructuring.