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What changed in PodcastOne, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of PodcastOne, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+347 added−251 removedSource: 10-K (2025-07-02) vs 10-K (2024-07-01)

Top changes in PodcastOne, Inc.'s 2025 10-K

347 paragraphs added · 251 removed · 208 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changePodcast Services Listeners can access our podcasts on their mobile devices and desktops across all major distribution platforms (Apple Podcasts, Spotify, Amazon Music, etc.). We offer all of our podcasts for free to cultivate a broad and loyal user base and generate organic traffic to our audio entertainment which has attractive monetization potential.
Biggest changeWe offer all of our podcasts for free to cultivate a broad and loyal user base and generate organic traffic to our audio entertainment which has attractive monetization potential. As we build and scale loyal listeners for our shows we are also building listeners for our other shows, due to our internal cross promotional network.
Item 1. Business Overview PodcastOne (the “Company,” “PodcastOne,” “we,” “us” or “our”) is a leading podcast platform and publisher that makes its content available to audiences via all podcasting distribution platforms, including PodcastOne’s website (www.podcastone.com), Apple Podcasts, Spotify, Amazon Music and more. We are a majority owned subsidiary of LiveOne, Inc., a Delaware corporation and a Nasdaq-listed company (“LiveOne”).
Item 1. Business Overview PodcastOne, Inc. (the “Company,” “PodcastOne,” “we,” “us” or “our”) is a leading podcast platform and publisher that makes its content available to audiences via all podcasting distribution platforms, including PodcastOne’s website (www.podcastone.com), Apple Podcasts, Spotify, Amazon Music and more. We are a majority owned subsidiary of LiveOne, Inc., a Delaware corporation and a Nasdaq-listed company (“LiveOne”).
Our users are able to listen to a variety of podcasts, from music, radio personalities, news, entertainment, comedy and sports. The podcasts are available on our platform, the LiveOne platforms and also on other leading podcast listening platforms, though various car manufacturers such as Apple Music, Spotify, and Amazon. We monetize podcasts through paid advertising.
Our users are able to listen to a variety of podcasts, from music, radio personalities, news, entertainment, comedy and sports. The podcasts are available on our platform, the LiveOne platforms and also on other leading podcast listening platforms, though various car manufacturers platforms such as Apple Music, Spotify, and Amazon. We monetize podcasts through paid advertising.
At the core of our shows are fundamental and trusted relationships with the hosts which collectively give us the ability to bring their vision to life. The multiple functions of creator services align cross-functionally and throughout PodcastOne to support creators on the platform while attracting new creators to our network.
At the core of our shows are fundamental and trusted relationships with the hosts which collectively give us the ability to bring their vision to life. The multiple functions of creator services align cross-functionally and throughout PodcastOne to support creators on the platform while attracting new creators to our network.
In addition, because of our deep-rooted relationships with talent we are able to engage them in host read embedded spots and coach them through voice-over delivery to increase direct response sales and advertiser satisfaction. Furthermore, these relationships allow us to create value-added opportunities with brands through talent socials, YouTube and other influencer marketing tools.
In addition, because of our deep-rooted relationships with talent we are able to engage them in host read embedded spots and coach them through voice-over delivery to increase direct response sales and advertiser satisfaction. Furthermore, these relationships allow us to create value-added opportunities with brands through talent socials, YouTube and other influencer marketing tools.
Advertisers benefit from branding a podcast series by getting 100% share of voice ads, which in our experience significantly helps them launch a new product, service or offering. Two podcast series examples that we have recently put together in a similar format are The Inevitable podcast and On the Edge with Microsoft Edge podcast.
Advertisers benefit from branding a podcast series by getting 100% share of voice ads, which in our experience significantly helps them launch a new product, service or offering. Two podcast series examples that we have recently put together in a similar format are The Inevitable podcast and On the Edge with Microsoft Edge podcast.
We also offer comprehensive sales opportunities for advertisers ranging from video, audio and social to live events and merchandise. By scaling across our talent’s networks we can offer exclusive branding opportunities to our clients including higher CPMs for us and value added opportunities for advertisers.
We also offer comprehensive sales opportunities for advertisers ranging from video, audio and social to live events and merchandise. By scaling across our talent’s networks we can offer exclusive branding opportunities to our clients including higher CPMs for us and value added opportunities for advertisers.
Legal Proceedings We are from time to time our Company or our parent company, LiveOne, is subject to various claims, lawsuits and other legal proceedings. Some of these claims, lawsuits and other legal proceedings involve highly complex issues, and often these issues are subject to substantial uncertainties.
Legal Proceedings Our Company or our parent company, LiveOne, from time to time is subject to various claims, lawsuits and other legal proceedings. Some of these claims, lawsuits and other legal proceedings involve highly complex issues, and often these issues are subject to substantial uncertainties.
As illustrated below, we have been ranked as high as #13 on the list of Top Podcast Publishers by the podcast metric company, Podtrac, as a leading podcast publisher. We offer content across verticals so there is something for everyone.
As illustrated below, we have been recently ranked as high as #8 on the list of Top Podcast Publishers by the podcast metric company, Podtrac, as a leading podcast publisher. We offer content across verticals so there is something for everyone.
Employees and Human Capital Resources As of March 31, 2024, we had 40 full-time and 6 part-time employees, all of which are located in the United States. None of our employees are covered by a collective bargaining agreement, and we consider our relationship with our employees to be good.
Employees and Human Capital Resources As of March 31, 2025, we had 40 full-time and no part-time employees, all of which are located in the United States. None of our employees are covered by a collective bargaining agreement, and we consider our relationship with our employees to be good.
With a proven 360-degree advertiser solution for multiplatform integration opportunities and hyper-targeting, we deliver millions of monthly impressions, 5.7+ million monthly unique listeners, and 19+ million IAB monthly downloads. With content covering all verticals (i.e. sports, entertainment, true-crime, business, audio dramas, self-growth, etc.), we provide a platform for brands to reach their most sought after targeted audiences.
With a proven 360-degree advertiser solution for multiplatform integration opportunities and hyper-targeting, we deliver millions of monthly impressions, 6.0+ million monthly unique listeners and 17+ million IAB monthly downloads. With content covering all verticals (i.e. sports, entertainment, true-crime, business, audio dramas, self-growth, etc.), we provide a platform for brands to reach their most sought after targeted audiences.
The monthly average number of downloads by our podcasts decreased from approximately 51.5 million in the fiscal year ended March 31, 2023 to approximately 30.7 million in the same period in 2024, driven primarily by Apple iOS 17’s change in download attribution methodology, as well as the departure of non-revenue generating partner networks from our podcast network.
The monthly average number of downloads by our podcasts decreased from approximately 30.7 million in the fiscal year ended March 31, 2024 to approximately 17.1 million in the same period in 2025, driven primarily by Apple iOS 17’s change in download attribution methodology, as well as the departure of non-revenue generating partner networks from our podcast network.
We are one of the largest independent podcast publishers with deep routed relationships with our creators, advertisers and distribution platforms. With over 5.5M unique downloads a month in the US and 29M global streams and downloads, PodcastOne’s portfolio continues to grow with engaged listeners and top tier talent.
We are one of the largest independent podcast publishers with deep routed relationships with our creators, advertisers and distribution platforms. With over 6.0M unique downloads a month in the US and 17M global streams and downloads, PodcastOne’s portfolio continues to grow with engaged listeners and top tier talent.
An estimated 177 million Americans have listened to a podcast at some point in their life, with “superfans” consuming over 11 hours of content per week in 2021.
An estimated 210 million Americans have listened to a podcast at some point in their life, with “superfans” consuming over 11 hours of content per week in 2024.
As a result, we have cultivated a highly engaged listener community across a variety of verticals (True Crime, Sports, TV & Film, etc.). In the quarter ending December 31, 2023, PodcastOne had recorded a total of 12 million average monthly listeners.
As a result, we have cultivated a highly engaged listener community across a variety of verticals (True Crime, Sports, TV & Film, etc.). In the quarter ending March 31, 2025, PodcastOne had recorded a total of 17 million average monthly listeners.
We prioritize establishing and maintaining an in-depth relationship with our creators so that we are viewed as a trusted and valued partner. The Podcast Industry Keeps Growing While Radio is Shrinking. For the first time ever, the podcast advertising marketing grew beyond $2.28B in 2023 and are expected to exceed $3.25B in 2024 and reach $4B by 2025.
We prioritize establishing and maintaining an in-depth relationship with our creators so that we are viewed as a trusted and valued partner. The Podcast Industry Keeps Growing While Radio is Shrinking. For the first time ever, the podcast advertising marketing grew beyond $2.43B in 2024 and are expected to exceed $2.89B in 2025 and reach $5B by 2027.
We own one of the largest networks of podcast content in North America, which has over 182 exclusive podcast shows that produces over 300 episodes per week and has generated over 3.6 billion downloads during the year ended March 31, 2024. 5 Table of Contents In addition to our core business, we also built, owns and operates a solution for the growing number of independent podcasters, LaunchpadOne.
We own one of the largest networks of podcast content in North America, which has over approximately 200 exclusive podcast shows that produces over 300 episodes per week and has generated over 204 million downloads during the year ended March 31, 2025. 5 Table of Contents In addition to our core business, we also built, owns and operates a solution for the growing number of independent podcasters, LaunchpadOne.
We have experienced significant growth in recent years driven by increased advertising activity. For the years ended March 31, 2024 and 2023, our revenue was $43.3 million and $34.6 million, respectively, representing year-over-year growth of 25%. We are more than a podcast company. We are in the relationship business.
We have experienced significant growth in recent years driven by increased advertising activity. For the years ended March 31, 2025 and 2024, our revenue was $52.1 million and $43.3 million, respectively, representing year-over-year growth of 20%. We are more than a podcast company. We are in the relationship business.
Year Ended March 31, 2024 2023 YoY Growth Number of podcast downloads 368,812,413 617,445,568 (40 )% The decrease in the number of podcast downloads can be attributed to due largely to modified download behavior by Apple iOS 17 as it continues to be adopted by podcast listeners, as well as the departure of non-revenue generating partner networks from our podcast network.
Year Ended March 31, 2025 2024 YoY Growth Number of podcast downloads 204,709,000 368,812,413 (44 )% The decrease in the number of podcast downloads can be attributed to due largely to modified download behavior by Apple iOS 17 as it continues to be adopted by podcast listeners, as well as the departure of non-revenue generating partner networks from our podcast network.
Our operating model is focused on offering white glove service to our shows, talent, and advertising clients. With an in-house sales, production, marketing, and tech team, we believe PodcastOne delivers more to clients and talent than any other publisher in the marketplace. This allows us to scale our operations while attracting talent who bring in brand advertisers and revenue.
With an in-house sales, production, marketing, and tech team, we believe PodcastOne delivers more to clients and talent than any other publisher in the marketplace. This allows us to scale our operations while attracting talent who bring in brand advertisers and revenue.
On September 21, 2023, we changed our corporate name to “PodcastOne, Inc.” After the completion of the Spin-Out, we became a standalone publicly traded company trading on The Nasdaq Capital Market. We remain a majority owned subsidiary of LiveOne.
On September 21, 2023, we changed our corporate name to “PodcastOne, Inc.” After the completion of the Spin-Out, we became a standalone publicly traded company trading on The Nasdaq Capital Market. We remain a majority owned subsidiary of LiveOne. We produce vodcasts (video podcasts), branded podcasts, merchandise and live events on behalf of our talent and clients.
Property and Equipment Our principal executive offices are located at 269 S. Beverly Drive, Suite 1450, Beverly Hills, CA 90212, and our corporate website address is www.podcastone.com.
Property and Equipment Our principal executive offices are located at 345 North Maple Drive, Suite 295, Beverly Hills, CA 90210, and our corporate website address is www.podcastone.com.
Creator Services Our in-house marketing and production teams are responsible for enhancing the growth and success of our talent/creators through various functions by focusing on brand building, audience development, strategy, talent, live events and sweepstakes.
As shows increase in listenership, their value also increases to advertisers, often times resulting in higher CPMs, in renewals and ultimately more revenue. Creator Services Our in-house marketing and production teams are responsible for enhancing the growth and success of our talent/creators through various functions by focusing on brand building, audience development, strategy, talent, live events and sweepstakes.
On September 8, 2023, we completed our spin-out from LiveOne, Inc., our parent and a Nasdaq listed company (“LiveOne”), and our direct listing on The Nasdaq Capital Market (the “Spin-Out”) and our shares of common stock began trading on the Nasdaq under the symbol of “PODC”.
We have recently been ranked as high as #8 on the list of Top Podcast Publishers by the podcast metric company Podtrac. On September 8, 2023, we completed our spin-out from LiveOne and our direct listing on The Nasdaq Capital Market (the “Spin-Out”) and our shares of common stock began trading on the Nasdaq under the symbol of “PODC”.
We intend to mitigate risk by acquiring multiple assets over time and across a broad spectrum of podcast related media and companies. We intend to develop these assets to provide returns via organic growth, revenue production, out-licensing or sale.
We intend to continue to acquire multiple assets over time and across a broad spectrum of podcast related media and companies. We intend to develop these assets to provide returns via organic growth, revenue production, out-licensing, sale or spin out. Our operating model is focused on offering white glove service to our shows, talent, and advertising clients.
Corporate Information We are a Delaware corporation incorporated on February 5, 2014. On July 1, 2020, we were acquired by LiveOne and became its wholly owned subsidiary. On July 15, 2022, we completed a private placement offering (the “Notes Financing”) of our unsecured convertible notes to certain accredited investors and institutional investors for gross proceeds of $8.8 million.
Corporate Information We are a Delaware corporation incorporated on February 5, 2014. On July 1, 2020, we were acquired by LiveOne and became its wholly owned subsidiary. On September 8, 2023, we completed our Spin-Out and our shares of common stock began trading on the Nasdaq under the symbol of “PODC”.
According to eMarketer, the number of podcast listeners is anticipated to grow to 135 million in 2024 and nearly 150 million listeners are expected to make podcasts a part of their media diet by 2027. Growth is projected to remain in double digits with an average podcast listening time per day topping 25 minutes by 2024.
According to eMarketer, the number of podcast listeners is anticipated to grow to 135 million in 2024 and nearly 150 million listeners are expected to make podcasts a part of their media diet by 2027. Podcast Services Listeners can access our podcasts on their mobile devices and desktops across all major distribution platforms (Apple Podcasts, Spotify, Amazon Music, etc.).
Approximately 18% of podcasts are consumed on YouTube and that number is quickly growing. Advertising Solutions for Partners ⸺ Our Ad-Supported Service has grown from $34.6 million in revenue for the year ended March 31, 2023 to $43.3 million in revenue for the year ended March 31, 2024, representing an increase of 25%.
Advertising Solutions for Partners ⸺ Our Ad-Supported Service has grown from $43.3 million in revenue for the year ended March 31, 2024 to $52.1 million in revenue for the year ended March 31, 2025, representing an increase of 20%. $8.2 million or 94% of the increase can be attributed to our single largest customer.
We completed our Spin-Out on September 8, 2023 and our shares of common stock began trading on the Nasdaq under the symbol of “PODC”. As a result of the Spin-Out, we became LiveOne’s majority owned subsidiary. On September 21, 2023, we changed our corporate name to “PodcastOne, Inc.” Our principal executive offices are located at 269 S.
As a result of the Spin-Out, we became LiveOne’s majority owned subsidiary. On September 21, 2023, we changed our corporate name to “PodcastOne, Inc.” Our principal executive offices are located at 345 North Maple Drive, Suite 295, Beverly Hills, CA 90210. 13 Table of Contents Available Information Our main corporate website address is www.liveone.com.
Removed
We have recently been ranked #13 on the list of Top Podcast Publishers by the podcast metric company Podtrac.
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In April 2025, we entered into a three-year Enterprise Service and Advertising Agreement with ART19 LLC (“ART19”), a subsidiary of Amazon.com, Inc. to move our existing network programming to the ART19 hosting platform. The agreement is expected to drive additional monetization opportunities across our vast library of popular podcasts.
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As a result of the completion of the spin-out of our Company from LiveOne, we became a standalone publicly traded company trading on The NASDAQ Capital Market. We remain a majority owned subsidiary of LiveOne, a Nasdaq listed company.
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Approximately 18% of podcasts are consumed on YouTube and that number is quickly growing.
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We intend to mitigate risk by acquiring multiple assets over time and across a broad spectrum of podcast related media and companies. We intend to develop these assets to provide returns via organic growth, revenue production, out-licensing, sale or spin out. We also produce vodcasts (video podcasts), branded podcasts, merchandise, and live events on behalf of our talent and clients.
Removed
As we build and scale loyal listeners for our shows we are also building listeners for our other shows, due to our internal cross promotional network. As shows increase in listenership, their value also increases to advertisers, often times resulting in higher CPMs, in renewals and ultimately more revenue.
Removed
Beverly Drive, Suite #1450, Beverly Hills, CA 90212. 13 Table of Contents Available Information Our main corporate website address is www.liveone.com.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeFactors that affect the amount of advertising spending, such as economic downturns, can make it difficult to predict our revenue and could adversely affect our business. ● Increases in the costs in relation to podcast content creators, such as higher podcast MGs and/or talent revenue share compensation and costs of discovering and cultivating a top podcast content creator, may have an adverse effect on our business, financial condition and results of operations. ● Negative media coverage could adversely affect our business. 14 Table of Contents Risks Related to Our Company ● If we are unable to establish and maintain effective disclosure controls and internal controls over financial reporting, our ability to produce accurate financial statements on a timely basis or prevent fraud could be impaired, and the market price of our securities may be negatively affected. ● We may face litigation and other risks as a result of the restatement of our previously issued financial statements and related matters. ● We heavily depend on relationships with our content providers and other industry stakeholders and adverse changes in these relationships, could adversely affect our business, financial condition and results of operations. ● LiveOne and/or our Company may not have sufficient cash flow from our and LiveOne’s business operations to make payments on its then current indebtedness and/or our indebtedness, if any. ● We rely on key members of our management and the loss of their services or investor confidence in them could adversely affect our success, development and financial condition. ● Unfavorable outcomes in legal proceedings may adversely affect our business, financial conditions and results of operations. ● We will continue to incur significant increased costs as a result of operating as a public company.
Biggest changeIf we are unable to establish and maintain effective disclosure controls and internal controls over financial reporting, our ability to produce accurate financial statements on a timely basis or prevent fraud could be impaired, and the market price of our securities may be negatively affected. ● If we are unable to establish and maintain effective disclosure controls and internal controls over financial reporting, our ability to produce accurate financial statements on a timely basis or prevent fraud could be impaired, and the market price of our securities may be negatively affected. ● We may face litigation and other risks as a result of the restatement of our previously issued financial statements and related matters. ● We heavily depend on relationships with our content providers and other industry stakeholders and adverse changes in these relationships, could adversely affect our business, financial condition and results of operations. ● LiveOne and/or our Company may not have sufficient cash flow from our and LiveOne’s business operations to make payments on its then current indebtedness and/or our indebtedness, if any. ● We rely on key members of our management and the loss of their services or investor confidence in them could adversely affect our success, development and financial condition. ● Unfavorable outcomes in legal proceedings may adversely affect our business, financial conditions and results of operations. ● We will continue to incur significant increased costs as a result of operating as a public company.
There is no guarantee that LiveOne, our Company and LiveOne’s other subsidiaries will be able to generate sufficient cash flow or sales to meet the financial covenants or pay the principal and interest under LiveOne’s debt agreements or to satisfy all of the financial covenants. We may also incur significant additional indebtedness in the future.
There is no guarantee that LiveOne, our Company and LiveOne’s other subsidiaries will be able to generate sufficient cash flow or sales to meet the financial covenants or pay the principal and interest under our debt agreements or to satisfy all of the financial covenants. We and/or LiveOne may also incur significant additional indebtedness in the future.
In connection with the preparation of our consolidated financial statements for the fiscal years ended March 31, 2024 and 2023, our management identified material weaknesses in the following: our controls related to the preparation of the financial statements were not adequately designed to ensure the accuracy and completeness of amounts and disclosures and the classification between current and noncurrent liabilities; and our management’s identification of and accounting for significant and unusual transactions, specifically accounting for business combinations, including push down accounting.
In connection with the preparation of our consolidated financial statements for the fiscal years ended March 31, 2024, our management identified material weaknesses in the following: our controls related to the preparation of the financial statements were not adequately designed to ensure the accuracy and completeness of amounts and disclosures and the classification between current and noncurrent liabilities; and our management’s identification of and accounting for significant and unusual transactions, specifically accounting for business combinations, including push down accounting.
However, LiveOne and its subsidiaries (including our Company) may not have sufficient funds or may be unable to arrange for additional financing to pay the amounts due under LiveOne’s existing debt. Funds from external sources may not be available on acceptable terms, if at all.
However, LiveOne and its subsidiaries (including our Company) may not have sufficient funds or may be unable to arrange for additional financing to pay the amounts due under our existing debt. Funds from external sources may not be available on acceptable terms, if at all.
So long as more than 50% of the voting power for the election of our directors is held by an individual, a group or another company, we qualify as a “controlled company” under listing requirements of The Nasdaq Capital Market. As of March 31, 2024, LiveOne continues to beneficially own a majority of our outstanding common stock and voting power.
So long as more than 50% of the voting power for the election of our directors is held by an individual, a group or another company, we qualify as a “controlled company” under listing requirements of The Nasdaq Capital Market. As of March 31, 2025, LiveOne continues to beneficially own a majority of our outstanding common stock and voting power.
LiveOne has announced that its senior management and/or board of directors has authorized the repurchase of up to approximately $10.0 million worth of shares of LiveOne’s and/or our outstanding common stock from time to time, subject to a portion of the repurchase program being approved by LiveOne’s board of directors and any other applicable approvals and consents, which LiveOne fully expects to obtain.
LiveOne has announced that its senior management and/or board of directors has authorized the repurchase of up to approximately $12.0 million worth of shares of LiveOne’s and/or our outstanding common stock from time to time, subject to a portion of the repurchase program being approved by LiveOne’s board of directors and any other applicable approvals and consents, which LiveOne fully expects to obtain.
Inferior internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of its common stock. To address our material weaknesses, we have added personnel as well as implemented new financial systems and processes.
Inferior internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of its common stock. To address our previously existing material weaknesses, we have added personnel as well as implemented new financial systems and processes.
We plan to expand into international markets in the 2025 fiscal year, which would subject us to risks associated with the legislative, judicial, accounting, regulatory, political and economic risks and conditions specific to such markets, which could adversely affect our business, financial condition and results of operations.
We plan to expand into international markets in the 2026 fiscal year, which would subject us to risks associated with the legislative, judicial, accounting, regulatory, political and economic risks and conditions specific to such markets, which could adversely affect our business, financial condition and results of operations.
LiveOne’s substantial debt combined with its and our other financial obligations and contractual commitments could have other significant adverse consequences, including: ● requiring LiveOne to dedicate a substantial portion of cash flow from operations to the payment of interest on, and principal of, our debt, which will reduce the amounts available to fund working capital, capital expenditures, product development efforts and other general corporate purposes; ● increasing our vulnerability to adverse changes in general economic, industry and market conditions; ● obligating us to restrictive covenants that may reduce our ability to take certain corporate actions or obtain further debt or equity financing; ● limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we compete; and ● placing us at a competitive disadvantage compared to our competitors that have less debt or better debt servicing options. 40 Table of Contents LiveOne intends to satisfy its current and future debt service obligations with its and our existing cash and cash equivalents and marketable securities and funds from external sources, including its, our Company and/or LiveOne’s subsidiaries’ equity and/or debt financing.
LiveOne’s substantial debt combined with its and our other financial obligations and contractual commitments could have other significant adverse consequences, including: ● requiring us to dedicate a substantial portion of our cash flow from operations to the payment of interest on, and principal of (including monthly redemptions thereof), LiveOne’s debt, which will reduce the amounts available to fund our working capital, capital expenditures, product development efforts and other general corporate purposes; ● increasing our vulnerability to adverse changes in general economic, industry and market conditions; ● obligating us to restrictive covenants that may reduce our ability to take certain corporate actions or obtain further debt or equity financing; ● limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we compete; and ● placing us at a competitive disadvantage compared to our competitors that have less debt or better debt servicing options. 40 Table of Contents LiveOne intends to satisfy its current and future debt service obligations with its and our existing cash and cash equivalents and funds from external sources, including its and/or its subsidiaries' equity and/or debt financing.
Accordingly, these agreements may not reflect terms that would have resulted from arms-length negotiations between unaffiliated parties. The terms of the agreements being negotiated relate to, among other things, allocations of assets, liabilities, rights, indemnifications and other obligations between LiveOne and us.
Accordingly, these agreements may not reflect terms that would have resulted from arms-length negotiations between unaffiliated parties. The terms of such agreements relate to, among other things, allocations of assets, liabilities, rights, indemnifications and other obligations between LiveOne and us.
Some of the material risk include, but are not limited to, the following: Risks Related to Our Business and Industry ● We have incurred significant operating and net losses since our inception and anticipate that we will continue to incur significant losses for the foreseeable future. ● We may require additional capital, including to fund our and/or LiveOne’s current debt obligations and to fund potential acquisitions and capital expenditures, which may not be available on terms acceptable to us or at all and which depends on many factors beyond our control. ● If LiveOne does not comply with the provisions of the ABL Credit Facility, the ABL Credit Facility lender may terminate their obligations to LiveOne, accelerate its debt and with respect to the ABL Credit Facility, require LiveOne and/or us to repay all outstanding amounts owed thereunder. ● Our failure to meet the continued listing requirements of Nasdaq could result in a de-listing of shares of our common stock and penny stock trading. ● There is substantial doubt about our ability to continue as a going concern. ● We face and will continue to face competition for ad-supported listening time. ● Our business is dependent upon the performance of our podcasts and their talent. ● Significant up-front and/or minimum guarantees required under certain of our podcast license agreements may limit our operating flexibility and may adversely affect our business, operating results, and financial condition. ● If we fail to increase the number of listeners consuming our podcast content, our business, financial condition and results of operations may be adversely affected. ● Our revenue and operating results are highly dependent on the overall demand for advertising.
Some of the material risk include, but are not limited to, the following: Risks Related to Our Business and Industry ● We have incurred significant operating and net losses since our inception and anticipate that we will continue to incur significant losses for the foreseeable future. ● We may require additional capital, including to fund our and/or LiveOne’s current debt obligations and to fund potential acquisitions and capital expenditures, which may not be available on terms acceptable to us or at all and which depends on many factors beyond our control. ● If LiveOne does not comply with the terms of its Debentures (as defined below) and/or the Capchase Loan (as defined below), its senior lenders may terminate its obligations to LiveOne and require LiveOne and/or us to repay all outstanding amounts owed thereunder. ● Our failure to meet the continued listing requirements of Nasdaq could result in a de-listing of shares of our common stock and penny stock trading. ● There is substantial doubt about our ability to continue as a going concern. ● We face and will continue to face competition for ad-supported listening time. ● Our business is dependent upon the performance of our podcasts and their talent. ● Significant up-front and/or minimum guarantees required under certain of our podcast license agreements may limit our operating flexibility and may adversely affect our business, operating results, and financial condition. ● If we fail to increase the number of listeners consuming our podcast content, our business, financial condition and results of operations may be adversely affected. ● Our revenue and operating results are highly dependent on the overall demand for advertising.
Our success depends, to a large degree, upon certain key members of our management, particularly Kit Gray, our President, Robert Ellin, our Executive Chairman, Aaron Sullivan, our Chief Financial Officer, and Sue McNamara, our Chief Revenue Officer. Mr. Gray has extensive knowledge about our business and our operations, and the loss of Mr. Gray, Mr. Ellin, Mr. Sullivan or Ms.
Our success depends, to a large degree, upon certain key members of our management, particularly Kit Gray, our President, Robert Ellin, our Executive Chairman, Ryan Carhart, our Chief Financial Officer, and Sue McNamara, our Chief Revenue Officer. Mr. Gray has extensive knowledge about our business and our operations, and the loss of Mr. Gray, Mr. Ellin, Mr. Carhart or Ms.
In addition to LiveOne’s current outstanding debt and notes and our Bridge Notes, we and our subsidiaries may incur substantial additional debt, subject to restrictions contained in LiveOne’s and our existing and future debt instruments, some or all of which may be secured debt.
In addition to LiveOne’s current outstanding debt and Debentures, we and our subsidiaries may incur substantial additional debt, subject to restrictions contained in LiveOne’s and our existing and future debt instruments, some or all of which may be secured debt.
As reflected in our consolidated financial statements included elsewhere herein, we have a history of losses, incurred significant operating and net losses in each year since our inception, including net losses of $14.7 million and $7.0 million for the fiscal years ended March 31, 2024 and 2023, respectively, and cash provided by/(used in) operating activities of $2.2 million and $(4.7) million for the fiscal years ended March 31, 2024 and 2023, respectively.
As reflected in our consolidated financial statements included elsewhere herein, we have a history of losses, incurred significant operating and net losses in each year since our inception, including net losses of $6.5 million and $14.7 million for the fiscal years ended March 31, 2025 and 2024, respectively, and cash (used in) provided by operating activities of $(0.2) million and $2.2 million for the fiscal years ended March 31, 2025 and 2024, respectively.
The senior credit facility contains certain restrictive covenants that limit our ability to merge with other companies or consummate certain changes of control, make certain investments, pay dividends or repurchase shares of our common stock, transfer or dispose of assets or enter into various specified transactions.
The Debentures contains certain restrictive covenants that limit our ability to merge with other companies or consummate certain changes of control, make certain investments, pay dividends or repurchase shares of our common stock, transfer or dispose of assets or enter into various specified transactions.
Risks Related to Our Relationship with LiveOne and its Indebtedness ● LiveOne’s debt agreements contain restrictive and financial covenants that may limit our operating flexibility, and LiveOne’s substantial indebtedness may limit cash flow available to us to invest in the ongoing needs of our business. ● LiveOne may not have the ability to repay the amounts then due under its ABL Credit Facility at maturity. ● We are a “controlled company” within the meaning of the corporate governance standards of The Nasdaq Capital Market as a result of the completion of the Spin-Out.
Risks Related to Our Relationship with LiveOne and its Indebtedness ● LiveOne’s debt agreements contain restrictive and financial covenants that may limit our operating flexibility, and LiveOne’s substantial indebtedness may limit cash flow available to us to invest in the ongoing needs of our business. ● LiveOne may not have the ability to repay the amounts then due under its Debentures at maturity or as otherwise required therein. ● We are a “controlled company” within the meaning of the corporate governance standards of The Nasdaq Capital Market as a result of the completion of the Spin-Out.
Furthermore, upon the occurrence and during the continuation of any event of default, the senior lender shall have the right to, among other things, take possession of LiveOne’s, our and LiveOne’s and our respective subsidiaries’ assets and property constituting the collateral thereunder and the right to assign, sell, lease or otherwise dispose of all or any part of the collateral.
Furthermore, upon the occurrence and during the continuation of any event of default, the Debentures holders shall have the right to, among other things, take possession of LiveOne’s, our Company’s and LiveOne’s and our respective subsidiaries’ assets and property constituting the collateral thereunder and the right to assign, sell, lease or otherwise dispose of all or any part of the collateral.
We may have been able to receive better terms from unaffiliated third parties than the terms we receive in our agreements with LiveOne. We will negotiate agreements with LiveOne related to our separation from LiveOne, including the Separation Agreement and Administrative Services Agreement, while we are still a majority owned subsidiary of LiveOne.
We may have been able to receive better terms from unaffiliated third parties than the terms we receive in our agreements with LiveOne. We negotiated agreements with LiveOne related to our separation from LiveOne, including the Separation Agreement and Administrative Services Agreement, while we were still a majority owned subsidiary of LiveOne.
Our ability to meet our total liabilities of $7.8 million as of March 31, 2024, and to continue as a going concern, is dependent on our ability to increase revenue, reduce costs, achieve a satisfactory level of profitable operations, obtain additional sources of suitable and adequate financing and further develop and execute on our business plan.
Our ability to meet our total liabilities of $6.1 million as of March 31, 2025, and to continue as a going concern, is dependent on our ability to increase revenue, reduce costs, achieve a satisfactory level of profitable operations, obtain additional sources of suitable and adequate financing and further develop and execute on our business plan.
LiveOne’s ABL Credit Facility also contains certain covenants, including maintaining a minimum amount of cash at all times and are secured by substantially all of LiveOne’s and our Company’s and LiveOne’s and our respective subsidiaries’ assets.
LiveOne’s Debentures also contains certain covenants, including maintaining a minimum amount of cash at all times and are secured by substantially all of LiveOne’s and our Company’s and LiveOne’s and our respective subsidiaries’ assets.
LiveOne beneficially owns a substantial majority of the shares of our outstanding common stock and voting power and will be able to exert significant control over matters subject to stockholder approval. In addition, Robert Ellin, our Executive Chairman, and his affiliates beneficially own approximately 5.45% of shares of LiveOne’s common stock issued and outstanding as of April 30, 2024.
LiveOne beneficially owns a substantial majority of the shares of our outstanding common stock and voting power and will be able to exert significant control over matters subject to stockholder approval. In addition, Robert Ellin, our Executive Chairman, and his affiliates beneficially own approximately 5.0% of shares of LiveOne’s common stock issued and outstanding as of May 31, 2025.
For example, please see more under “⸺ If LiveOne does not comply with the provisions of the ABL Credit Facility, the ABL Credit Facility lender may terminate their obligations to LiveOne, accelerate its debt and with respect to the ABL Credit Facility, require LiveOne and/or us to repay all outstanding amounts owed thereunder.” Even if we adequately address the issues raised by an investigation or proceeding or successfully defend a third-party lawsuit or counterclaim, we may have to devote significant financial and management resources to address these issues, which could harm our business, financial condition and results of operations. 37 Table of Contents We will continue to incur significant increased costs as a result of operating as a public company.
For example, please see more under “⸺ If LiveOne does not comply with the terms of its Debentures and/or the Capchase Loan, its senior lenders may terminate its obligations to LiveOne and require LiveOne and/or us to repay all outstanding amounts owed thereunder.” Even if we adequately address the issues raised by an investigation or proceeding or successfully defend a third-party lawsuit or counterclaim, we may have to devote significant financial and management resources to address these issues, which could harm our business, financial condition and results of operations. 37 Table of Contents We will continue to incur significant increased costs as a result of operating as a public company.
Robert Ellin and our other directors Ramin Arani, Jay Krigsman and Craig Foster, serve as both our directors and as directors of LiveOne. Robert Ellin, our Executive Chairman, and Aaron Sullivan, our Chief Financial Officer, serve both as our and LiveOne’s senior management.
Robert Ellin and our other directors Ramin Arani and Jay Krigsman, serve as both our directors and as directors of LiveOne. Robert Ellin, our Executive Chairman, and Ryan Carhart, our Chief Financial Officer, serve both as our and LiveOne’s senior management.
As of March 31, 2024, we had an accumulated deficit of $29.6 million and net working capital of $0.9 million. We anticipate incurring additional losses until such time that we can generate significant increases to our revenues, and/or reduce our operating costs and losses.
As of March 31, 2025, we had an accumulated deficit of $36.1 million and net working capital of $1.5 million. We anticipate incurring additional losses until such time that we can generate significant increases to our revenues, and/or reduce our operating costs and losses.
If an event of default occurs and is continuing, the ABL Credit Facility lender may among other things, terminate its obligations thereunder, accelerate its debt and require LiveOne and/or us to repay all amounts thereunder. For example, on October 13, 2022, a judgement was ordered in favor of SoundExchange, Inc.
If an event of default occurs and is continuing, the Debentures holders and/or Capchase may among other things, terminate their obligations thereunder, accelerate their debt and require LiveOne and/or us to repay all amounts thereunder. For example, on October 13, 2022, a judgement was entered in favor of SoundExchange, Inc.
Factors that might cause such a difference include, but are not limited to, those set out above. Item 1B. Unresolved Staff Comments None.
Factors that might cause such a difference include, but are not limited to, those set out above.
LiveOne’s existing debt agreements with the ABL Credit Facility lender contain certain restrictive covenants that limit our ability to merge with other companies or consummate certain changes of control, make certain investments, pay dividends or repurchase shares of our common stock, transfer or dispose of assets, or enter into various specified transactions.
LiveOne’s existing debt agreements with the senior lenders contain certain financial and restrictive covenants that require LiveOne to redeem a portion of the Debentures monthly, limit our ability to merge with other companies or consummate certain changes of control, make certain investments, pay dividends or repurchase shares of our common stock, transfer or dispose of assets, or enter into various specified transactions.
We therefore may not be able to engage in any of the foregoing transactions unless we obtain the consent of LiveOne’s ABL Credit Facility lender or LiveOne terminates its existing debt agreements. LiveOne’s ABL Credit Facility also contains certain financial covenants, including maintaining a minimum cash amount at all times, and is secured by substantially all of our assets.
We therefore may not be able to engage in any of the foregoing transactions unless we obtain the consent of LiveOne’s senior secured lenders or terminate our existing debt agreements. LiveOne’s debt agreements related to the Debentures also contain certain financial covenants, including maintaining a minimum cash amount at all times and are secured by substantially all of our assets.
If for any reason LiveOne and Slacker fail to comply with the terms of its settlement agreement with SX, the ABL Credit Facility lender may declare an event of default and at its option may immediately accelerate its debt and require LiveOne and/or us to repay all outstanding amounts owed thereunder, which would materially adversely impact our business, operating results and financial condition.
If for any reason LiveOne fails to comply with the terms of the SX Settlement Agreement, the Debentures holders may declare an event of default and at their option may immediately accelerate the Debentures debt and require LiveOne and/or us to repay all outstanding amounts owed under the Debentures and which would then allow Capchase to declare a default under their loan agreement with LiveOne, which would materially adversely impact our business, operating results and financial condition.
For our fiscal years ended March 31, 2024 and 2023, our management conducted an assessment of our disclosure controls and procedures and our internal control over financial reporting and concluded that they were ineffective for each of such periods, due to the existence of certain material weaknesses in our internal control over financial reporting.
For our fiscal year ended March 31, 2024, our management conducted an assessment of its disclosure controls and procedures and our internal control over financial reporting and concluded that they were not effective for such period, due to the existence of certain material weaknesses in our internal control over financial reporting, which were subsequently remediated. See Item 9A.
(“SX”) against LiveOne and Slacker in the United States District Court Central District of California in the amount of approximately $9.8 million. On October 13, 2022, the court entered a judgment against the defendants for the amount of $9.8 million.
(“SX”) against LiveOne and Slacker in the United States District Court Central District of California in the amount of approximately $9.8 million.
For so long as we remain a smaller reporting company, we are permitted and intend to rely on exemptions from certain disclosure and other requirements that are applicable to other public companies that are not smaller reporting companies, such as providing only two years of audited financing statements, providing simplified executive compensation disclosures in our filings, being exempt from the provisions of Section 404(b) of the Sarbanes-Oxley Act requiring that independent registered public accounting firms provide an attestation report on the effectiveness of our internal control over financial reporting, and having certain other decreased disclosure obligations in our filings with the SEC.
As a “smaller reporting company,” we (i) are able to provide simplified executive compensation disclosures in our filings, (ii) are exempt from the provisions of Section 404(b) of the Sarbanes-Oxley Act requiring that independent registered public accounting firms provide an attestation report on the effectiveness of internal control over financial reporting, and (iii) have certain other decreased disclosure obligations in our filings with the SEC, including being required to provide only two years of audited financial statements in our annual reports.
If we are unable to establish and maintain proper and effective disclosure controls and procedures and internal control over financial reporting, it may not be able to produce timely and accurate financial statements. We may face litigation and other risks as a result of the restatement of our previously issued financial statements and related matters.
If we are unable to establish and maintain proper and effective disclosure controls and procedures and internal control over financial reporting, it may not be able to produce timely and accurate financial statements.
The ABL Credit Facility contain provisions that limit LiveOne’s operating activities, including covenant relating to the requirement for LiveOne to maintain a certain amount cash (as provided in the ABL Credit Facility).
LiveOne’s Debentures and the Capchase Loan contain certain provisions that limit its and our operating activities, including the Debentures containing a covenant relating to the requirement to maintain a certain amount cash (as provided in the Debentures).
If LiveOne does not comply with the provisions of the ABL Credit Facility, the ABL Credit Facility lender may terminate their obligations to LiveOne, accelerate its debt and with respect to the ABL Credit Facility, require LiveOne and/or us to repay all outstanding amounts owed thereunder.
If LiveOne does not comply with the terms of its Debentures and/or the Capchase Loan, its senior lenders may terminate its obligations to LiveOne and require LiveOne and/or us to repay all outstanding amounts owed thereunder.
If the repayment of the related indebtedness were to be accelerated after any applicable notice or grace periods, LiveOne and our Company may not have sufficient funds to repay LiveOne’s ABL Credit Facility or make cash payments thereon.
If the repayment of the related indebtedness were to be accelerated after any applicable notice or grace periods, LiveOne may not have sufficient funds to repay its Debentures, the Capchase Loan or make cash payments as required by such debt agreements.
There can be no assurance that we will be able to continue to meet all of the criteria necessary for Nasdaq to allow us to remain listed.
Our failure to meet the continued listing requirements of Nasdaq could result in a de-listing of shares of our common stock and penny stock trading. There can be no assurance that we will be able to continue to meet all of the criteria necessary for Nasdaq to allow us to remain listed.
We intend to continue to take steps to remediate the material weaknesses described above through hiring additional qualified accounting and financial reporting personnel, and further evolving our accounting processes. We will not be able to fully remediate these material weaknesses until these steps have been completed and have been operating effectively for a sufficient period of time.
We will not be able to fully remediate these material weaknesses until these steps have been completed and have been operating effectively for a sufficient period of time.
As a result of the going concern uncertainty, there is an increased risk that you could lose the entire amount of your investment in our company, which assumes the realization of our assets and the satisfaction of our liabilities and commitments in the normal course of business. 16 Table of Contents We may require additional capital, including to fund our and/or LiveOne ’ s current debt obligations and to fund potential acquisitions and capital expenditures, which may not be available on terms acceptable to us or at all and which depends on many factors beyond our control.
As a result of the foregoing, we expect to continue to incur significant losses for the foreseeable future and we may not be able to achieve or sustain profitability. 16 Table of Contents We may require additional capital, including to fund our and/or LiveOne ’ s current debt obligations and to fund potential acquisitions and capital expenditures, which may not be available on terms acceptable to us or at all and which depends on many factors beyond our control.
The lack of renewal, or termination, of one or more of our license agreements, or the renewal of a license agreement on less favorable terms, could have a material adverse effect on its business, financial condition, and results of operations. 34 Table of Contents Risks Related to Our Company For the fiscal years ended March 31, 2024 and 2023, our management concluded that our disclosure controls and procedures and our internal control over financial reporting were not effective due to the existence of material weaknesses in our internal control over financial reporting during such periods.
In addition, the expansion and improvement of our systems and infrastructure may require us to commit substantial financial, operational and technical resources, with no assurance that our business will improve. 34 Table of Contents Risks Related to Our Company For the fiscal year ended March 31, 2024, our management concluded that our disclosure controls and procedures and our internal control over financial reporting were not effective due to the existence of material weaknesses in our internal control over financial reporting during such periods.
Its total outstanding consolidated indebtedness as of March 31, 2024 was $8.5 million, net of fees and discounts. While LiveOne has certain restrictions and covenants with its current indebtedness, it could in the future incur additional indebtedness beyond such amount.
Furthermore, while LiveOne has certain restrictions and covenants with its current indebtedness, LiveOne could in the future incur additional indebtedness beyond such amount, including by issuing the Additional Debentures subject to Conditions.
If our culture is negatively affected, our ability to support our growth and innovation may diminish.
If our culture is negatively affected, our ability to support our growth and innovation may diminis We may be subject to risks associated with artificial intelligence and machine learning technology. Recent technological advances in artificial intelligence (“AI”) and machine learning technology may pose risks to us.
Removed
In February 2023, LiveOne settled the dispute to repay the outstanding amount via 24 monthly payments, subject to certain increased payments in the event LiveOne completes one or more of certain future financings. As of March 31, 2024, LiveOne owed $2.4 million to SX under the settlement agreement.
Added
Factors that affect the amount of advertising spending, such as economic downturns, can make it difficult to predict our revenue and could adversely affect our business. ● Increases in the costs in relation to podcast content creators, such as higher podcast MGs and/or talent revenue share compensation and costs of discovering and cultivating a top podcast content creator, may have an adverse effect on our business, financial condition and results of operations. ● Negative media coverage could adversely affect our business. 14 Table of Contents Risks Related to Our Company ● For the fiscal year ended March 31, 2024, our management concluded that our disclosure controls and procedures and our internal control over financial reporting were not effective.
Removed
LiveOne’s debt agreements with the ABL Credit Facility lender contains a covenant that if a material adverse change occurs in our financial condition, or if the ABL Credit Facility lender reasonably believes the prospect of payment or performance of its loan is materially impaired, the lender at its option may immediately accelerate its debt and require LiveOne and/or us to repay all outstanding amounts owed thereunder.
Added
To date, we have financed our operations exclusively through the sale of equity securities (including convertible securities), and after our acquisition by LiveOne on July 1, 2020, through LiveOne’s sale of its and our equity and/or debt securities (including convertible securities).
Removed
As of March 31, 2024, LiveOne was in compliance with covenants under the ABL Credit Facility and the Capchase Loan. Our failure to meet the continued listing requirements of Nasdaq could result in a de-listing of shares of our common stock and penny stock trading.
Added
We anticipate incurring additional losses until such time that we can generate significant increases to our revenues, and/or reduce our operating costs and losses.
Removed
LiveOne may not have the ability to repay the amounts then due under its ABL Credit Facility at maturity. At maturity the entire outstanding principal amount of LiveOne’s ABL Credit Facility will become due and payable by it.
Added
The size of our future net losses will depend, in part, on the rate of future expenditures and our ability to significantly grow our business and increase our revenues. We expect to continue to incur substantial and increased expenses as we grow our business. We also expect an increase in our expenses associated with our operations as a publicly-traded company.
Removed
As of March 31, 2024, $7.7 million of its total indebtedness is due in fiscal 2025, $0.6 million is due in fiscal 2026 and $0.1 million thereafter. LiveOne’s failure to repay any outstanding amount of its senior credit facility would constitute a default under such facility.
Added
We may incur significant losses in the future for a number of other reasons, including unsuccessful acquisitions, costs of integrating new businesses, expenses, difficulties, complications, delays and other unknown events.
Removed
A default would increase the interest rate to the default rate under the senior credit facility or the maximum rate permitted by applicable law until such amount is paid in full. A default under LiveOne’s ABL Credit Facility could also lead to a default under agreements governing LiveOne’s and/or our future indebtedness.
Added
On May 19, 2025 (the “Closing Date”), we and LiveOne, our parent, entered into a Securities Purchase Agreement (the “SPA”) with certain institutional investors (each, a “Purchaser” and collectively, the “Purchasers”), pursuant to which (i) LiveOne sold to the Purchasers our Original Issue Discount Senior Secured Convertible Debentures (the “Initial Debentures”) in an aggregate principal amount of $16,775,000 for an aggregate cash purchase price of $15.25 million, and (ii) if certain conditions are satisfied as set forth in the SPA, including at least one of the Conditions (as defined below), LiveOne may sell at its option to the Purchasers its additional Original Issue Discount Senior Secured Convertible Debentures in an aggregate principal amount of $11,000,000 on substantially the same terms as the Initial Debentures (the “Additional Debentures” and collectively with the Initial Debentures, the “Debentures”).
Removed
Please also see above under the risk factor captioned “⸺ If LiveOne does not comply with the provisions of the ABL Credit Facility, the ABL Credit Facility lender may terminate their obligations to LiveOne, accelerate its debt and with respect to the ABL Credit Facility, require LiveOne and/or us to repay all outstanding amounts owed thereunder,” for potential consequences if an event of default is triggered as a result of LiveOne’s default under its settlement agreement with SX.
Added
The Debentures are convertible into shares of LiveOne’s common stock at the holder’s option at a conversion price of $2.10 per share, subject to certain customary adjustments such as stock splits, stock dividends and stock combinations.
Removed
We are currently considered to be a “smaller reporting company” as defined by the SEC’s revised rules.
Added
LiveOne may sell to the Purchasers the Additional Debentures if within 15 months of the Closing Date either of the following conditions have been satisfied during such 15-month period (the “Conditions”): (x) the VWAP (as defined in the SPA) of LiveOne’s common stock has been equal to or greater than $4.20 per share (subject to certain customary adjustments such as stock splits, stock dividends and stock combinations) for 30 consecutive trading days, or (y) Free Cash Flow (as defined in the SPA) has been equal to or greater to $3,000,000 for three consecutive fiscal quarters, and has increased in each of the foregoing quarters from the immediately preceding fiscal quarter.
Added
The Initial Debentures mature on May 19, 2028 and accrue interest at 11.75% per year.
Added
Commencing with the calendar month of August 2025 (subject to the following sentence), the holders of the Initial Debentures will have the right, at their option, to require LiveOne to redeem an aggregate of up to $100,000 of the outstanding principal amount of the Debentures per month.
Added
Commencing from November 18, 2025, May 18, 2026 and May 18, 2027, the holders of the Initial Debentures will have the right, at their option, to require LiveOne to redeem an aggregate of up to $150,000, $250,000 and $300,000, respectively, of the outstanding principal amount of the Initial Debentures per month.
Added
Over the term of the Debentures and at maturity, the outstanding principal amount of the Debentures and the Capchase Loan (as defined below), will become due and payable by us in installments.
Added
As of May 31, 2025, $0.6 million of the principal amount of the Capchase Loan is due and matures in fiscal 2026 and the principal amount of the Debentures is due and matures in fiscal 2029.
Added
The holders of the Debentures may also require LiveOne to redeem the Debentures up to $0.8 million due in fiscal 2026, $1.2 million due in fiscal 2027, $1.2 million due in fiscal 2028 and $13.6 million due in fiscal 2029.
Added
In February 2023, LiveOne and Slacker settled the dispute (the “SX Settlement Agreement”) to pay the outstanding amount in monthly payments subject to increase in the event LiveOne or Slacker complete certain future financings, which agreement, as amended in January 2025, requires LiveOne and Slacker to pay SX the remaining sum on or before February 1, 2027, in 48 monthly payments, unless LiveOne or Slacker repays the judgment amount earlier pursuant to the terms of the SX Settlement Agreement, and SX agreed not to take any action to enforce such judgment, so long as the defendants are not in default under the agreement.
Added
As of March 31, 2025, LiveOne and Slacker owed $2.6 million to SX under the SX Settlement Agreement.
Added
In the event LiveOne fails to make any payment of any principal of, or interest or premium on, any indebtedness owed to the Debentures holders, Capchase would have the right to declare a default under its loan agreement with LiveOne. A default under the Debentures could also lead to a default under agreements governing our future indebtedness.
Added
As of March 31, 2025, LiveOne was in compliance with all covenants under the Capchase Loan. As of March 31, 2025, LiveOne was not in compliance with all covenants under its former senior secured line of credit.
Added
As of May 31, 2025, LiveOne was in compliance with all covenants under the Debentures and Capchase Loan as the senior secured line of credit was paid off in full with the issuance of the Debentures.
Added
As a result of the going concern uncertainty, there is an increased risk that you could lose the entire amount of your investment in our company, which assumes the realization of our assets and the satisfaction of our liabilities and commitments in the normal course of business.
Added
The lack of renewal, or termination, of one or more of our license agreements, or the renewal of a license agreement on less favorable terms, could have a material adverse effect on its business, financial condition, and results of operations. We may be subject to risks associated with artificial intelligence and machine learning technology.
Added
Recent technological advances in artificial intelligence (“AI”) and machine learning technology may pose risks to us. Our use of AI could give rise to legal or regulatory action, create liabilities, or materially harm our business.
Added
While we aim to develop and use AI and machine learning technology responsibly and attempt to mitigate ethical and legal issues presented by its use, we may ultimately be unsuccessful in identifying or resolving issues before they arise. Further, as the technology is rapidly evolving, costs and obligations could be imposed on us to comply with new regulations.
Added
We also could be exposed to the risks of machine learning technology if third-party service providers or any counterparties, whether or not known to us, also use machine learning technology in their business activities. We will not be in a position to control the use of such technology in third-party products or services.
Added
Use by third-party service providers could give rise to issues pertaining to data privacy, data protection, and intellectual property considerations. Advancements in AI Technology May Adversely Affect Our Business Model and Competitive Position. The rapid development and adoption of AI technologies pose risks to our operations, user engagement, and revenue generation.
Added
AI tools may enable the creation of high-quality synthetic music that could compete with licensed content from our platform, reducing demand for traditional music streaming services. Additionally, the use of AI by competitors to enhance user personalization, recommend content, or improve discovery may surpass our technological capabilities, potentially diminishing our market share.
Added
Further, our reliance on AI for functions such as recommendation algorithms, fraud detection, and content moderation introduces operational risks. Errors or biases in our AI systems could result in a poor user experience, reduced engagement, or potential reputational harm.
Added
If we fail to maintain or advance our AI capabilities or if we are perceived as lagging behind in AI innovation, our business, financial condition, and results of operations could be adversely affected.
Added
Moreover, as regulators worldwide consider new policies regarding AI development, use, and intellectual property rights, our business may face increased compliance costs or limitations on our ability to use AI tools effectively. Such regulations could impact the availability or cost of AI technologies and hinder our ability to innovate, further exacerbating competitive pressures.
Added
Wildfires and Other Natural Disasters in and Around Los Angeles May Disrupt Our Operations and Adversely Impact Our Business. Our headquarters and a significant portion of our operations are located in Los Angeles, a region prone to wildfires and other natural disasters such as earthquakes and power outages.

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Item 2. Properties

Properties — owned and leased real estate

1 edited+1 added−1 removed0 unchanged
Biggest changeWe currently have no policy with respect to investments or interests in real estate, real estate mortgages or securities of, or interests in, persons primarily engaged in real estate activities.
Biggest changeWe believe that this property is in good condition and suitable for the conduct of our business. We currently have no policy with respect to investments or interests in real estate, real estate mortgages or securities of, or interests in, persons primarily engaged in real estate activities.
Removed
Item 2. Properties PodcastOne co-leases its Los Angeles premises located at 269 S. Beverly Dr., Suite 1450, Beverly Hills, CA 90212 with LiveOne. We believe that this property is in good condition and suitable for the conduct of our business.
Added
Item 2. Properties PodcastOne leases its Los Angeles premises located at 345 North Maple Drive, Suite 295, Beverly Hills, CA 90210 consisting of approximately 1,398 square feet of office and podcast studio space under a lease agreement expiring in June 2026, which we intend to continue as a month to month lease.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

3 edited+0 added−0 removed5 unchanged
Biggest changePurchases of Equity Securities by the Issuer and Affiliated Purchasers (c) (d) Total Maximum number of number shares (or approximate (or units) dollar value) of (a) purchased shares Total (b) as part of (or units) number of Average publicly that may yet shares price paid announced be purchased (or units) per share plans or under the plans Period purchased (or unit) programs or programs* January 1, 2024 – January 31, 2024 - $ - - 1,684,817 shares February 1, 2024 – February 29, 2024 - $ - - 1,684,817 shares March 1, 2024 – March 31, 2024 - $ - - 1,593,063 shares Total (January 1, 2024 – March 31, 2024) - $ - - $ 4,000,000 57 Table of Contents * Does not include a $2.5 million increase to LiveOne’s repurchase program announced by LiveOne in September 2023, which is subject to approval of LiveOne's board of directors, pursuant to which LiveOne may repurchase shares of its and/or our common stock.
Biggest changePurchases of Equity Securities by the Issuer and Affiliated Purchasers (c) (d) Total Maximum number of number shares (or approximate (or units) dollar value) of (a) purchased shares Total (b) as part of (or units) number of Average publicly that may yet shares price paid announced be purchased (or units) per share plans or under the plans Period purchased (or unit) programs or programs January 1, 2025 – January 31, 2025 - $ - - $ 6,500,000 February 1, 2025 - February 28, 2025 - $ - - $ 6,500,000 March 1, 2025 - March 31, 2025 - $ - - $ 6,500,000 Total (January 1, 2025 – March 31, 2025) - $ - - $ 6,500,000 57 Table of Contents
Item 5. Market for Registrant ’ s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Shares of our common stock have been trading publicly on The NASDAQ Capital Market under the symbol "PODC" since September 8, 2023. Number of Holders As of March 31, 2024, there were 403 stockholders of record of our common stock.
Item 5. Market for Registrant ’ s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Shares of our common stock have been trading publicly on The NASDAQ Capital Market under the symbol "PODC" since September 8, 2023. Number of Holders As of March 31, 2025, there were 392 stockholders of record of our common stock.
Issuances of Shares, Options and Restricted Stock Units to Consultants, Employees, and Vendors Fiscal Year 2024 During the fiscal year ended March 31, 2024, we issued an aggregate of 3,608,049 shares of our common stock to our consultants, employees, and vendors. Issuance of Securities in Private Offerings for Cash Fiscal Year 2024 None.
Issuances of Shares, Options and Restricted Stock Units to Consultants, Employees, and Vendors Fiscal Year 2025 During the fiscal year ended March 31, 2025, we issued an aggregate of 2,408,058 shares of our common stock to our consultants, employees, and vendors. Issuance of Securities in Private Offerings for Cash Fiscal Year 2025 None.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeActual results may vary materially from those expressed or implied by the forward-looking statements herein due to a variety of factors, including: our ability to consummate any proposed financing, acquisition, spin-out, distribution or transaction, the timing of the closing of such proposed event, including the risks that a condition to closing would not be satisfied within the expected timeframe or at all or that the closing of any proposed financing, acquisition or transaction, the timing of the closing of such proposed event will not occur or whether any such event will enhance shareholder value; our ability to continue as a going concern; if and when required, our ability to obtain additional capital, including to fund our and/or our parent's LiveOne’s current debt obligations and to fund potential acquisitions and capital expenditures; our ability to attract, maintain and increase the number of our listeners; our ability to identify, acquire, secure and develop content; our ability to successfully implement our growth strategy, our ability to acquire and integrate our acquired businesses, the ability of the combined business to grow, including through acquisitions which we are able to successfully integrate, and the ability of our executive officers to manage growth profitably; the outcome(s) of any legal proceedings pending or that may be instituted against us, our subsidiaries, or third parties to whom we owe indemnification obligations; changes in laws or regulations that apply to us or our industry; our ability to recognize and timely implement future technologies in the music and live streaming space; our ability to capitalize on investments in developing our service offerings, including our ability to deliver and develop upon current and future technologies; significant product development expenses associated with our technology initiatives; our ability to timely and economically obtain necessary approval(s), releases and or licenses on a timely basis for the use of our content on an appliable platform; our ability to obtain and maintain international authorizations to operate our service over the proper foreign jurisdictions our listeners utilize; our ability to expand our service offerings and deliver on our service roadmap; our ability to timely and cost-effectively produce, identify and or deliver compelling content that brands will advertise on and/or listeners desire to listen to; general economic and technological circumstances in the podcasting and digital streaming markets; our ability to obtain and maintain our current and new desirable content; the loss of, or failure to realize benefits from, agreements with our content providers and partners; unfavorable economic conditions in the podcasting industry and economy as a whole; our ability to expand our domestic or international operations, including our ability to grow our business with current and potential future podcasting platforms and partners; the effects of service interruptions or delays, technology failures, material defects or errors in our software, damage to our equipment or geopolitical restrictions; costs associated with defending pending or future intellectual property infringement actions and other litigation or claims; increases in our projected capital expenditures due to, among other things, unexpected costs incurred in connection with the roll out of our technology roadmap or our plans of expansion in North America and internationally; fluctuation in our operating results; the demand for podcasting and digital media streaming services and market acceptance for our products and services; our ability to generate sufficient cash flow to make payments on our and/or LiveOne’s indebtedness; our incurrence of additional indebtedness in the future; our ability to repay the bridge notes at maturity; the effect of the conditional conversion feature of the bridge notes; LiveOne’s compliance with the covenants in its credit facility agreement; LiveOne’s intent to repurchase shares of its and/or our common stock from time to time under its announced stock repurchase program and the timing, price, and quantity of repurchases, if any, under the program; risks and uncertainties applicable to the businesses of our Company and/or our subsidiaries; and other risks and uncertainties set forth herein.
Biggest changeActual results may vary materially from those expressed or implied by the forward-looking statements herein due to a variety of factors, including: our ability to successfully implement our growth strategy, including relating to our technology platforms and applications; our ability to attract, maintain and increase the number of our listeners; management’s relationships with industry stakeholders; if and when required, our ability to obtain additional capital, including to fund our and/or LiveOne’s current debt obligations and to fund potential acquisitions and capital expenditures; our and LiveOne’s ability to consummate any proposed financing, acquisition, merger, distribution or other transaction, the timing of the consummation of any such proposed event, including the risks that a condition to the consummation of any such event would not be satisfied within the expected timeframe or at all, or that the consummation of any proposed financing, acquisition, merger, special dividend, distribution or transaction will not occur or whether any such event will enhance shareholder value; our ability to continue as a going concern; our ability to identify, acquire, secure and develop content; our ability to recognize and timely implement future technologies in the music and live streaming space; our ability to capitalize on investments in developing our service offerings, including our ability to deliver and develop upon current and future technologies; significant product development expenses associated with our technology initiatives; our ability to timely and economically obtain necessary approval(s), releases and or licenses on a timely basis for the use of our content on an appliable platform; our ability to obtain and maintain international authorizations to operate our service over the proper foreign jurisdictions our listeners utilize; our ability to expand our service offerings and deliver on our service roadmap; our ability to timely and cost-effectively produce, identify and or deliver compelling content that brands will advertise on and/or listeners desire to listen to; general economic and technological circumstances in the podcasting and digital streaming markets; our ability to obtain and maintain our current and new desirable content; the loss of, or failure to realize benefits from, agreements with our content providers and partners; unfavorable economic conditions in the podcasting industry and economy as a whole; our ability to expand our domestic or international operations, including our ability to grow our business with current and potential future podcasting platforms and partners; the effects of service interruptions or delays, technology failures, material defects or errors in our software, damage to our equipment or geopolitical restrictions; costs associated with defending pending or future intellectual property infringement actions and other litigation or claims; increases in our projected capital expenditures due to, among other things, unexpected costs incurred in connection with the roll out of our technology roadmap or our plans of expansion in North America and internationally; fluctuation in our operating results; the demand for podcasting and digital media streaming services and market acceptance for our products and services; LiveOne’s reliance on its largest OEM customer for a substantial percentage of its revenue; LiveOne’s intent to repurchase shares of its and/or our common stock from time to time under LiveOne’s announced stock repurchase program and the timing, price, and quantity of repurchases, if any, under the program; LiveOne’s ability to maintain compliance with certain of its financial and other covenants; our ability to generate sufficient cash flow to make payments on our and/or LiveOne’s indebtedness; LiveOne’s ability to repay its indebtedness when due; LiveOne’s ability to satisfy the conditions for closing on its announced additional convertible debentures financing; our incurrence of additional indebtedness in the future; uncertain and unfavorable outcomes in legal proceedings and/or our and/or LiveOne’s ability to pay any amounts due in connection with any such legal proceedings; changes in economic conditions; competition; risks and uncertainties applicable to the businesses of our Company, LiveOne and/or LiveOne’s other subsidiaries; and other risks, uncertainties and factors set forth herein.
After the listing of our common stock, we continue to incur additional expenses as a result of operating as a public company, including costs to comply with the rules and regulations applicable to companies listed on a U.S. securities exchange and costs related to compliance and reporting obligations pursuant to the rules and regulations of the SEC.
After the listing of our common stock, we continue to incur additional expenses as a result of operating as a public company, including costs to comply with the rules and regulations applicable to companies listed on a U.S. securities exchange and costs related to compliance and reporting obligations pursuant to the rules and regulations of the U.S.
We generate revenue by charging a CPM based on the volume of purchased digital ads that we measure on behalf of these customers. If the volume of impressions we measure does not continue to grow or decreases for any reason, our business will suffer.
We generate revenue by charging CPM based on the volume of purchased digital ads that we measure on behalf of these customers. If the volume of impressions we measure does not continue to grow or decreases for any reason, our business will suffer.
Cash Flows Used In Investing Activities Net cash used in investing activities for the year ended March 31, 2024 of $1.3 million was principally due to the $1.0 million cash used for the purchase of intangibles and $0.3 million for the purchase of property and equipment during such period.
Net cash used in investing activities for the year ended March 31, 2024 of $1.3 million was principally due to the $1.0 million of cash used for the purchase of intangibles and $0.3 million of cash used for the purchase of property and equipment during such period.
As a result of the Spin-Out, we issued 3,114,000 warrants to purchase shares of our common stock all of which were issued and outstanding as of March 31, 2024. In August 2023, LiveOne entered into a $1.7 million secured loan with Capchase which accrues interest at 8% and matures 30 months form issuance (the “Capchase Loan”).
As a result of the Spin-Out, we issued 3,114,000 warrants to purchase shares of our common stock all of which were issued and outstanding as of March 31, 2025. In August 2023, LiveOne entered into a $1.7 million secured loan with Capchase which accrues interest at 8% and matures 30 months form issuance (the “Capchase Loan”).
The following discussion and analysis of our business and results of operations for the fiscal year ended March 31, 2024, and our financial conditions at that date, should be read in conjunction with the financial statements and the notes thereto included elsewhere in this Annual Report.
The following discussion and analysis of our business and results of operations for the fiscal year ended March 31, 2025, and our financial conditions at that date, should be read in conjunction with the financial statements and the notes thereto included elsewhere in this Annual Report.
Adjusted EBITDA Adjusted EBITDA is a non-GAAP financial measure that we define as net income (loss) before (a) non-cash GAAP purchase accounting adjustments for certain deferred revenue and costs, (b) legal, accounting and other professional fees directly attributable to acquisition activity, (c) employee severance payments and third party professional fees directly attributable to acquisition or corporate realignment activities, (d) certain non-recurring expenses associated with legal settlements or reserves for legal settlements in the period that pertain to historical matters that existed at acquired companies prior to their purchase date, (e) depreciation and amortization (including goodwill and intangible asset impairment, if any), and (f) certain stock-based compensation expense.
Adjusted EBITDA Adjusted EBITDA is a non-GAAP financial measure that we define as net income (loss) before (a) non-cash GAAP purchase accounting adjustments for certain deferred revenue and costs, (b) legal, accounting and other professional fees directly attributable to acquisition activity, (c) employee severance payments and third party professional fees directly attributable to acquisition or corporate realignment activities, (d) certain non-recurring expenses associated with legal settlements or reserves for legal settlements in the period that pertain to historical matters that existed at acquired companies prior to their purchase date, (e) interest and other collateral/loan-related fees, (f) depreciation and amortization (including goodwill and intangible asset impairment, if any), and (g) certain stock-based compensation expense.
In addition, our independent registered public accounting firm in their audit report to our financial statements for the fiscal year ended March 31, 2024 expressed substantial doubt about our ability to continue as a going concern.
In addition, our independent registered public accounting firm in their audit report to our financial statements for the fiscal year ended March 31, 2025 expressed substantial doubt about our ability to continue as a going concern.
GAAP financial measures and to not rely on any single financial measure to evaluate our business. 61 Table of Contents Components of Results of Operations Revenue We generate revenue primarily consist of revenues generated from the sale of audio, video, and display advertising space to third-party advertising exchanges.
GAAP financial measures and to not rely on any single financial measure to evaluate our business. 61 Table of Contents Components of Results of Operations Revenue We generate revenue primarily from the sale of audio, video, and display advertising space to third-party advertising exchanges.
Product Development Product development costs not capitalized are primarily expenses for research and development, product and content development activities, including internal software development and improvement costs which have not been capitalized by the Company. General and Administrative General and administrative expenses consist primarily of personnel-related expenses for our finance, human resources, information technology, and legal organizations.
Product Development Product development costs not capitalized are primarily expenses for research and development, product and content development activities, including internal software development and improvement costs which have not been capitalized by us. General and Administrative General and administrative expenses consist primarily of personnel-related expenses for our finance, human resources, information technology, and legal organizations.
Liquidity and Capital Resources Current Financial Condition As of March 31, 2024, our principal sources of liquidity were our cash and cash equivalents in the amount of $1.4 million, which primarily are invested in cash in banking institutions in the U.S.
Liquidity and Capital Resources Current Financial Condition As of March 31, 2025, our principal sources of liquidity were our cash and cash equivalents in the amount of $1.1 million, which primarily are invested in cash in banking institutions in the U.S.
Net cash used in investing activities for the year ended March 31, 2023 of $0.2 million was principally due to the $0.2 million cash used for the purchase of property and equipment during such period.
Cash Flows Used In Investing Activities Net cash used in investing activities for the year ended March 31, 2025 of $0.2 million was principally due to the $0.2 million of cash used for the purchase of property and equipment during such period.
The remainder of our sources of cash used in operating activities of $3.2 million was from changes in our working capital, including $2.0 million from timing of intercompany payables/receivables.
The remainder of our sources of cash used in operating activities of $3.2 million for this period was from changes in our working capital, including $2.0 million from timing of intercompany payables/receivables.
As reflected in our consolidated financial statements included elsewhere in this Annual Report, we have a history of losses and had working capital of $0.9 million as of March 31, 2024. These factors, among others, raise substantial doubt about our ability to continue as a going concern within one year from the date that the financial statements are issued.
As reflected in our consolidated financial statements included elsewhere in this Annual Report, we have a history of losses and had working capital of $1.5 million as of March 31, 2025. These factors, among others, raise substantial doubt about our ability to continue as a going concern within one year from the date that the financial statements are issued.
Launchpad One serves as a talent pool for us to find new podcasts and talent. We have experienced significant growth in recent years driven by increased advertising activity. For the years ended March 31, 2024 and 2023, our revenue was $43.3 million and $34.6 million, respectively, representing year-over-year growth of 25%. We are more than a podcast company.
Launchpad One serves as a talent pool for us to find new podcasts and talent. We have experienced significant growth in recent years driven by increased advertising activity. For the years ended March 31, 2025 and 2024, our revenue was $52.1 million and $43.3 million, respectively, representing year-over-year growth of 20%. We are more than a podcast company.
From time to time we enter into barter transactions involving advertising provided in exchange for goods and services. Revenue from barter transactions is recognized ratably over time based on the terms of the contract as delivery of impressions is performed on a consistent basis. Services received are charged to expense in the same manner.
From time to time we enter into barter transactions involving advertising provided in exchange for goods and services. Revenue from barter transactions is recognized ratably over time based on the terms of the contract as delivery of impressions is performed on a consistent basis.
The decrease was primarily due to less advertising spending as it pertained to marketing our podcast shows. Product Development Product development decreased $0.2 million, or 73%, for fiscal 2024 compared to fiscal 2023. The decrease was primarily due to a decrease in project activity.
The decrease was primarily due to less advertising spending as it pertained to marketing our podcast shows. Product Development Product development decreased $0.1 million, or 39%, for fiscal 2025 compared to fiscal 2024. The decrease was primarily due to a decrease in project activity.
Year Ended March 31, 2024 2023 YoY Growth Number of podcast downloads 368,812,413 617,445,568 (40 )% The decrease in the number of podcast downloads can be attributed to due largely to modified download behavior by Apple iOS 17 as it continues to be adopted by podcast listeners, as well as the departure of non-revenue generating partner networks from our podcast network.
Year Ended March 31, 2025 2024 YoY Growth Number of podcast downloads 204,709,000 368,812,413 (44 )% The decrease in the number of podcast downloads can be attributed to due largely to modified download behavior by Apple iOS 17 as it continues to be adopted by podcast listeners, as well as the departure of non-revenue generating partner networks from our podcast network.
In addition, as a public company, we continue to incur additional costs associated with accounting, compliance, insurance, and investor relations.
Securities and Exchange Commission (the "SEC"). In addition, as a public company, we continue to incur additional costs associated with accounting, compliance, insurance, and investor relations.
Revenues are recognized based on delivery of impressions over the contract period to the third-party exchanges, either when an ad is placed for listening or viewing by a visitor or when the visitor “clicks through” on the advertisement. The advertising exchange companies report the variable advertising revenue on a monthly basis.
Revenues are recognized based on delivery of impressions over the contract period to the third-party exchanges, either when an ad is placed for listening or viewing by a visitor or when the visitor “clicks through” on the advertisement.
Cash Flows (Used In) Provided By Financing Activities Net cash provided by financing activities for the year ended March 31, 2024 of $3.0 million was primarily due to payment on our PC1 Bridge Loan of $3.0 million.
Cash Flows Used In Financing Activities Net cash used in financing activities for the year ended March 31, 2025 was none. Net cash used in financing activities for the year ended March 31, 2024 of $3.0 million was primarily due to the repayment of our PC1 Bridge Loan of $3.0 million.
The increase can be attributed to the increase in content related intangibles associated with the acquisition of certain podcasts. 65 Table of Contents Other Income (Expense), net Year Ended March 31, 2024 2023 % Change Total other income (expense), net $ (9,666 ) $ (5,132 ) 88 % Other income (expense), net increased $4.5 million, or 88%, for fiscal 2024 compared to fiscal 2023.
The increase can be attributed to the increase in content related intangibles associated with the acquisition of certain podcasts. 65 Table of Contents Other Income (Expense), net Year Ended March 31, 2025 2024 % Change Total other income (expense), net $ - $ (9,666 ) -100 % Other income (expense), net decreased $9.7 million, or 100%, for fiscal 2025 compared to fiscal 2024.
Sales and Marketing Sales and Marketing include direct and indirect costs related to our advertising and marketing. Advertising expenses to promote the Company’s services are expensed as incurred.
Sales and Marketing Sales and Marketing include direct and indirect costs related to our advertising and marketing. Additionally, sales and marketing include merchandising advertising and royalty costs. Advertising expenses to promote our services are expensed as incurred.
Our operating model is focused on offering white glove service to our shows, talent, and advertising clients. With an in-house sales, production, marketing, and tech team, we believe PodcastOne delivers more to clients and talent than any other publisher in the marketplace. This allows us to scale our operations while attracting talent who bring in brand advertisers and revenue.
With an in-house sales, production, marketing, and tech team, we believe PodcastOne delivers more to clients and talent than any other publisher in the marketplace. This allows us to scale our operations while attracting talent who bring in brand advertisers and revenue.
The remainder of our sources of cash used in operating activities of $3.7 million was from changes in our working capital, including $4.2 million from timing of intercompany payables/receivables.
The remainder of our sources of cash used in operating activities of $1.8 million for this period was from changes in our working capital, including $2.4 million from timing of intercompany payables/receivables.
Other Income (Expense), Net Other income (expense), net consists primarily of interest expense, gain/losses on derivatives, forgiveness on PPP loans and changes in fair value of contingent consideration. Results of Operations The following tables set forth our results of operations for the periods presented and as a percentage of our revenue for those periods.
Other Income (Expense), Net Other income (expense), net consists primarily of interest expense and gain/losses on derivatives. Results of Operations The following tables set forth our results of operations for the periods presented and as a percentage of our revenue for those periods.
The increase is primarily due to an increase of $7.1 million due to the change in fair value of derivatives. This increase was offset by a $2.4 million decrease in interest expense attributed to the payoff of our Bridge Loan, which began in July 2022 and was extinguished in September 2023.
The increase is primarily due to an increase of $7.6 million due to the change in fair value of derivatives. In addition, there was a decrease of $2.2 million in interest expense attributed to the payoff of our Bridge Loan (as defined below), which began in July 2022 and was extinguished in September 2023.
Net cash used in our operating activities for the year ended March 31, 2023 of $4.7 million primarily resulted from our net loss during the period of $7.0 million, which included non-cash charges of $5.9 million largely comprised of depreciation and amortization, stock-based compensation, accretion of debt discount and change in fair value of derivatives.
Net cash provided by our operating activities for the year ended March 31, 2024 of $2.2 million primarily resulted from our net loss during the period of $14.7 million, which included non-cash charges of $13.8 million largely comprised of depreciation and amortization, stock-based compensation, accretion of debt discount and change in fair value of derivatives.
The following table sets forth the reconciliation of Adjusted EBITDA to net loss, the most comparable GAAP financial measure for the year ended March 31, 2024 and 2023 (in thousands): Non- Recurring Depreciation Acquisition and Other (Benefit) Net Income and Stock-Based Realignment (Income) Provision Adjusted (Loss) Amortization Compensation Costs Expense for Taxes EBITDA Year Ended March 31, 2024 Total $ (14,732 ) $ 1,148 $ 3,483 $ 881 $ 9,666 $ 55 $ 501 Year Ended March 31, 2023 Total $ (6,967 ) $ 323 $ 1,001 $ 939 $ 5,132 $ - $ 428 The following table sets forth the reconciliation of Contribution Margin to Revenue, the most comparable GAAP financial measure (in thousands): Year Ended March 31, 2024 2023 Revenue: $ 43,302 $ 34,645 Less: Cost of sales (37,326 ) (27,579 ) Amortization of developed technology (228 ) (225 ) Gross Profit 5,748 6,841 Add back amortization of developed technology: 228 225 Contribution Margin $ 5,976 $ 7,066 Limitations and Reconciliations of Non-GAAP Financial Measures Non-GAAP financial measures are presented for supplemental informational purposes only.
The following table sets forth the reconciliation of Adjusted EBITDA to net loss, the most comparable GAAP financial measure for the year ended March 31, 2025 and 2024 (in thousands): Non- Recurring Depreciation Acquisition and Other (Benefit) Net Income and Stock-Based Realignment (Income) Provision Adjusted (Loss) Amortization Compensation Costs Expense for Taxes EBITDA Year Ended March 31, 2025 Total $ (6,458 ) $ 1,671 $ 4,215 $ 47 $ - $ 24 $ (501 ) Year Ended March 31, 2024 Total $ (14,732 ) $ 1,148 $ 3,483 $ 881 $ 9,666 $ 55 $ 501 The following table sets forth the reconciliation of Contribution Margin to Revenue, the most comparable GAAP financial measure (in thousands): Year Ended March 31, 2025 2024 Revenue: $ 52,119 $ 43,302 Less: Cost of sales (47,394 ) (37,326 ) Amortization of developed technology (227 ) (228 ) Gross Profit 4,498 5,748 Add back amortization of developed technology: 227 228 Contribution Margin $ 4,725 $ 5,976 Limitations and Reconciliations of Non-GAAP Financial Measures Non-GAAP financial measures are presented for supplemental informational purposes only.
We were recently ranked #13 on the list of Top Podcast Publishers by the podcast metric company Podtrac. After the completion of the Spin-Out, we became a standalone publicly traded company trading on The NASDAQ Capital Market under the symbol “PODC”. We remain a majority owned subsidiary of LiveOne, a Nasdaq listed company.
We were recently ranked as high as #8 on the list of Top Podcast Publishers by the podcast metric company Podtrac. After the completion of the spin-out of our Company from LiveOne the ("Spin-Out"), we became a standalone publicly traded company trading on The NASDAQ Capital Market under the symbol “PODC”.
Sources and Uses of Cash Cash Flows The following table provides information regarding our cash flows for the fiscal years ended March 31, 2024 and 2023 (in thousands): Year Ended March 31, 2024 2023 Net cash provided by (used in) operating activities $ 2,211 $ (4,698 ) Net cash used in investing activities (1,328 ) (219 ) Net cash (used in) provided by financing activities (3,000 ) 7,376 Net change in cash, cash equivalents and restricted cash $ (2,117 ) $ 2,459 Cash Provided By (Used In) Operating Activities Net cash provided by our operating activities for the year ended March 31, 2024 of $2.2 million primarily resulted from our net loss during the period of $14.7 million, which included non-cash charges of $13.8 million largely comprised of depreciation and amortization, stock-based compensation, accretion of debt discount and change in fair value of derivatives.
Sources and Uses of Cash Cash Flows The following table provides information regarding our cash flows for the fiscal years ended March 31, 2025 and 2024 (in thousands): Year Ended March 31, 2025 2024 Net cash (used in) provided by operating activities $ (212 ) $ 2,211 Net cash used in investing activities (154 ) (1,328 ) Net cash used in financing activities - (3,000 ) Net change in cash, cash equivalents and restricted cash $ (366 ) $ (2,117 ) Cash (Used In) Provided By Operating Activities Net cash used in operating activities for the year ended March 31, 2025 of $0.2 million primarily resulted from our net loss during the period of $6.5 million, which included non-cash charges of $4.4 million largely comprised of depreciation and amortization, stock-based compensation, provision for credit losses and impairment of intangibles.
The increase was in line with our revenue growth as revenue share splits with our content creators remained consistent. 64 Table of Contents Operating Expenses Year Ended March 31, 2024 2023 % Change Sales and marketing expenses $ 4,558 $ 5,174 (12 )% Product development 85 312 (73 )% General and administrative 5,448 3,316 64 % Amortization of intangible assets 896 99 805 % Total Other Operating Expenses $ 10,987 $ 8,901 23 % Sales and Marketing Sales and marketing expenses decreased $0.6 million, or 12%, for fiscal 2024 compared to fiscal 2023.
The increase was in line with our revenue growth as revenue share splits with our content creators remained consistent. 64 Table of Contents Operating Expenses Year Ended March 31, 2025 2024 % Change Sales and marketing expenses $ 3,479 $ 4,558 (24 )% Product development 52 85 (39 )% General and administrative 6,205 5,448 14 % Impairment of intangible assets 334 - 100 % Amortization of intangible assets 1,089 896 22 % Total Other Operating Expenses $ 11,159 $ 10,987 2 % Sales and Marketing Sales and marketing expenses decreased $1.1 million, or 24%, for fiscal 2025 compared to fiscal 2024.
Year Ended March 31, 2024 2023 Revenue: $ 43,302 $ 34,645 Operating expenses: Cost of sales 37,326 27,579 Sales and marketing 4,558 5,174 Product development 85 312 General and administrative 5,448 3,316 Amortization of intangible assets 896 99 Total operating expenses 48,313 36,480 Loss from operations (5,011 ) (1,835 ) Other income (expense): Interest expense, net (2,247 ) (4,674 ) Change in fair value of derivatives (7,603 ) (459 ) Other income (expense) 184 1 Total other income (expense), net (9,666 ) (5,132 ) Loss before provision for income taxes (14,677 ) (6,967 ) Provision for income taxes 55 - Net loss $ (14,732 ) $ (6,967 ) Net loss per share – basic and diluted $ (0.68 ) $ (0.06 ) Weighted average common shares – basic and diluted 21,767,810 110,816,207 63 Table of Contents The following table provides the depreciation expense included in the above line items (in thousands): Year Ended March 31, 2024 2023 % Change Depreciation expense Cost of sales $ 143 $ 114 25 % Sales and marketing 90 89 1 % Product development - - 0 % General and administrative 19 21 (10 )% Total depreciation expense $ 252 $ 224 13 % The following table provides the stock-based compensation expense included in the above line items (in thousands): Year Ended March 31, 2024 2023 % Change Stock-based compensation expense Cost of sales $ 655 $ 279 135 % Sales and marketing 718 203 254 % Product development 12 179 (93 )% General and administrative 2,098 340 517 % Total stock-based compensation expense $ 3,483 $ 1,001 248 % The following table provides our results of operations, as a percentage of revenue, for the periods presented: Year Ended March 31, 2024 2023 Revenue 100 % 100 % Operating expenses Cost of sales 86 % 80 % Sales and marketing 11 % 15 % Product development 0 % 1 % General and administrative 13 % 10 % Amortization of intangible assets 2 % 0 % Total operating expenses 112 % 105 % Income (loss) from operations (12 )% (5 )% Other income (expense), net (22 )% (15 )% Loss before income taxes (34 )% (20 )% Income tax provision 0 % 0 % Net loss (34 )% (20 )% Revenue Revenue increased $8.7 million, or 25%, for our fiscal year ended March 31, 2024 ("fiscal 2024") compared to our year ended March 31, 2023 ("fiscal 2023").
Year Ended March 31, 2025 2024 Revenue: $ 52,119 $ 43,302 Operating expenses: Cost of sales 47,394 37,326 Sales and marketing 3,479 4,558 Product development 52 85 General and administrative 6,205 5,448 Impairment of intangible and fixed assets 334 - Amortization of intangible assets 1,089 896 Total operating expenses 58,553 48,313 Loss from operations (6,434 ) (5,011 ) Other income (expense): Interest expense, net - (2,247 ) Change in fair value of derivatives - (7,603 ) Other income - 184 Total other expense, net - (9,666 ) Loss before provision for income taxes (6,434 ) (14,677 ) Provision for income taxes 24 55 Net loss $ (6,458 ) $ (14,732 ) Net loss per share – basic and diluted $ (0.26 ) $ (0.68 ) Weighted average common shares – basic and diluted 24,381,613 21,767,810 63 Table of Contents The following table provides the depreciation expense included in the above line items (in thousands): Year Ended March 31, 2025 2024 % Change Depreciation expense Cost of sales $ 145 $ 143 1 % Sales and marketing 85 90 (6 )% General and administrative 20 19 5 % Total depreciation expense $ 250 $ 252 (1 )% The following table provides the stock-based compensation expense included in the above line items (in thousands): Year Ended March 31, 2025 2024 % Change Stock-based compensation expense Cost of sales $ 93 $ 655 (86 )% Sales and marketing 31 718 (96 )% Product development - 12 (100 )% General and administrative 4,091 2,098 95 % Total stock-based compensation expense $ 4,215 $ 3,483 21 % The following table provides our results of operations, as a percentage of revenue, for the periods presented: Year Ended March 31, 2025 2024 Revenue 100 % 100 % Operating expenses Cost of sales 91 % 86 % Sales and marketing 7 % 11 % Product development 0 % 0 % General and administrative 12 % 13 % Impairment of intangible assets 0 % 0 % Amortization of intangible assets 2 % 2 % Total operating expenses 112 % 112 % Income (loss) from operations (12 )% (12 )% Other income (expense), net 0 % (22 )% Loss before income taxes (12 )% (34 )% Income tax provision 0 % 0 % Net loss (12 )% (34 )% Revenue Revenue increased $8.8 million, or 20%, for our fiscal year ended March 31, 2025 ("fiscal 2025") compared to our year ended March 31, 2024 ("fiscal 2024").
In addition to our core business, we have also build, own and operate a solution for the growing number of independent podcasters, LaunchpadOne. LaunchpadOne is a self-publishing podcast platform, created to provide a low or no cost tool for independent podcasters without access to parent podcasting networks or state of the art equipment to create shows.
LaunchpadOne is a self-publishing podcast platform, created to provide a low or no cost tool for independent podcasters without access to parent podcasting networks or state of the art equipment to create shows.
Amortization of Intangible Assets Amortization of intangible assets increased by $0.8 million, or 805%, to $0.9 million for fiscal 2024 compared to fiscal 2023.
Amortization of Intangible Assets Amortization of intangible assets increased by $0.2 million, or 22%, for fiscal 2025 compared to fiscal 2024.
Limitations and Reconciliations of Non-GAAP Financial Measures Non-GAAP financial measures are presented for supplemental informational purposes only. Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as substitutes for financial information presented under U.S. GAAP.
Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as substitutes for financial information presented under U.S. GAAP. There are a number of limitations related to the use of non-GAAP financial measures versus comparable financial measures determined under U.S. GAAP.
We intend to mitigate risk by acquiring multiple assets over time and across a broad spectrum of podcast related media and companies. We intend to develop these assets to provide returns via organic growth, revenue production, out-licensing, sale or spin out. We also produce vodcasts (video podcasts), branded podcasts, merchandise, and live events on behalf of our talent and clients.
We remain a majority owned subsidiary of LiveOne, a Nasdaq listed company. We intend to mitigate risk by acquiring multiple assets over time and across a broad spectrum of podcast related media and companies. We intend to develop these assets to provide returns via organic growth, revenue production, out-licensing, sale or spin out.
Recent Accounting Pronouncements See Note 2 — Summary of Significant Accounting Policies to our consolidated financial statements included elsewhere in this Annual Report for a discussion of new accounting pronouncements. 73 Table of Contents
Debt Covenants As of March 31, 2025, LiveOne was in compliance with all covenants under the Capchase Loan and the ABL Credit Facility. Recent Accounting Pronouncements See Note 2 — Summary of Significant Accounting Policies to our consolidated financial statements included elsewhere in this Annual Report for a discussion of new accounting pronouncements. 73 Table of Contents
In the absence of additional sources of liquidity, management anticipates that existing cash resources will not be sufficient to meet current operating and liquidity needs beyond June 2025.
We are looking to secure additional interim financing in the immediate future, which is needed to continue our current level of operations in the future and satisfy our obligations. In the absence of additional sources of liquidity, management anticipates that existing cash resources will not be sufficient to meet current operating and liquidity needs beyond June 2026.
The increase in revenue was primarily due to the increase in advertising inventory. Cost of sales Cost of sales increased $9.7 million, or 35%, for fiscal 2024 compared to fiscal 2023.
The increase in revenue was primarily due to the increase in advertising inventory. $8.2 million or 94% of the increase can be attributed to our single largest customer. Cost of sales Cost of sales increased $10.7 million, or 27%, for fiscal 2025 compared to fiscal 2024.
GAAP financial measures and the reconciliations of these non-GAAP financial measures to their most directly comparable U.S.
All of these limitations could reduce the usefulness of these non-GAAP financial measures as analytical tools. Investors are encouraged to review the related U.S. GAAP financial measures and the reconciliations of these non-GAAP financial measures to their most directly comparable U.S.
General and Administrative General and administrative expenses increased $2.1 million, or 64%, for fiscal 2024 compared to fiscal 2023. The increase was primarily due to an increase in stock-based compensation, additional cost incurred attributed to the spin-out and our legal and accounting fees.
General and Administrative General and administrative expenses increased $0.8 million, or 14%, for fiscal 2025 compared to fiscal 2024. The increase was primarily due to an increase in stock-based compensation and our legal and accounting fees. Impairment of Intangible and Fixed Assets Impairment of intangible assets increased by $0.3 million, or 100%, for fiscal 2025 compared to fiscal 2024.
As of March 31, 2024, we had a related party payable balance of $0.3 million. Our parent is required to maintain a minimum cash balance as a result of debt covenants on its debt.
All of such Bridge Notes were converted into shares of our common stock in connection with the completion of our Direct Listing. As of March 31, 2025, we had a net related party payable balance of $0.2 million. Our parent is required to maintain a minimum cash balance as a result of debt covenants on its debt.
In addition, free cash flow does not reflect our future contractual commitments and the total increase or decrease of our cash balance for a given period. All of these limitations could reduce the usefulness of these non-GAAP financial measures as analytical tools. Investors are encouraged to review the related U.S.
For example, other companies in our industry may calculate these non-GAAP financial measures differently or may use other measures to evaluate their performance. In addition, free cash flow does not reflect our future contractual commitments and the total increase or decrease of our cash balance for a given period.
Our ability to continue as a going concern is dependent on our ability to execute our strategy and on our ability to raise additional funds through the sale of equity and/or debt securities via public and/or private offerings. 72 Table of Contents Credit Agreement and Other Debt For additional information regarding our credit agreement and other debt, see “Contractual Obligations” in this Item 7 below and in the footnotes to the Consolidated Financial Statements (Notes 6,7, and 8 to our financial statements included elsewhere in this Annual Report).
Our ability to continue as a going concern is dependent on our ability to execute our strategy and on our ability to raise additional funds through the sale of equity and/or debt securities via public and/or private offerings.
We own one of the largest networks of podcast content in North America, which has over 182 exclusive podcast shows that produces over 300 episodes per week and has generated over 3.6 billion downloads to date. In April 2021, LiveOne announced an agreement with Samsung for all our distributed content to be available via the Listen tab on Samsung TV.
We own one of the largest networks of podcast content in North America, which has over 300 exclusive podcast shows that produces over 275 episodes per week and has generated over 3.6 billion downloads to date. In addition to our core business, we have also build, own and operate a solution for the growing number of independent podcasters, LaunchpadOne.
With a proven 360-degree advertiser solution for multiplatform integration opportunities and hyper-targeting, we deliver millions of monthly impressions, 5.7+ million monthly unique listeners, and 19+ million IAB monthly downloads. With content covering all verticals (i.e. sports, entertainment, true-crime, business, audio dramas, self-growth, etc.), we provide a platform for brands to reach their most sought after targeted audiences.
With content covering all verticals (i.e. sports, entertainment, true-crime, business, audio dramas, self-growth, etc.), we provide a platform for brands to reach their most sought after targeted audiences. Our operating model is focused on offering white glove service to our shows, talent and advertising clients.
As of March 31, 2024, LiveOne’s total outstanding consolidated indebtedness was $8.5 million, net of fees and discounts, which consisted of ABL Credit Facility and the Capchase Loan.
In connection with the sale of the Debentures, LiveOne paid off all obligations owing under, and terminated, the 2025 Business Loan Agreement, and all related loan agreements. As of May 31, 2025, LiveOne’s total outstanding consolidated indebtedness was $17.4 million, net of fees and discounts, which consisted of the Debentures and the Capchase Loan.
Removed
Basis of Presentation Our consolidated financial statements have been prepared on the same basis as our audited consolidated financial statements for the fiscal year ended March 31, 2024, and include all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of our consolidated financial statements for the year ended March 31, 2024.
Added
We also produce vodcasts (video podcasts), branded podcasts, merchandise and live events on behalf of our talent and clients. With a proven 360-degree advertiser solution for multiplatform integration opportunities and hyper-targeting, we deliver millions of monthly impressions, 5.7+ million monthly unique listeners and 19+ million IAB monthly downloads.
Removed
There are a number of limitations related to the use of non-GAAP financial measures versus comparable financial measures determined under U.S. GAAP. For example, other companies in our industry may calculate these non-GAAP financial measures differently or may use other measures to evaluate their performance.
Added
Basis of Presentation Our results of operations and financial position are consolidated with LiveOne’s financial statements and these financial statements have been derived as if we had operated on a standalone basis during the years ended March 31, 2025 and 2024.
Removed
On September 8, 2023 and effective as of August 22, 2023, LiveOne entered into a new Business Loan Agreement with the senior credit facility provider to convert the senior credit facility into an assets backed loan credit facility, which shall continue to be collateralized by a first lien on all of the assets of LiveOne and its subsidiaries (the “ABL Credit Facility”).
Added
The amounts recorded for related party transactions with LiveOne may not be considered arm’s length transactions and therefore, the financial statements may not necessarily reflect our results of operations, financial position and cash flows had we engaged in such transactions with an unrelated third party during the years ended March 31, 2025 and 2024.
Removed
The Business Loan Agreement provides LiveOne with borrowing capacity of up to the Borrowing Base (as defined in the Business Loan Agreement). Pursuant to the Business Loan Agreement, the requirement that LiveOne and its related entities shall at all times maintain a certain minimum deposit with the senior credit facility provider was reduced from $7,000,000 to $5,000,000.
Added
Accordingly, our historical financial information is not necessarily indicative of what our results of operations, financial position and cash flows will be in the future, if and when we contract at arm’s length with unrelated third parties for services they receive from LiveOne. Limitations and Reconciliations of Non-GAAP Financial Measures Non-GAAP financial measures are presented for supplemental informational purposes only.
Removed
We are looking to secure additional interim financing in the immediate future after the completion of the Direct Listing, which is needed to continue our current level of operations in the future and satisfy our obligations.
Added
The increase is attributed to the cancellation of a show previously acquired (see Note 4 – Goodwill and Intangible Assets) in the amount of $.02 million and the remining due to ceasing to use some of the company's internally developed software.
Removed
Net cash provided by financing activities for the year ended March 31, 2023 of $7.4 million was primarily due to proceeds on our PC1 Bridge Loan of $7.4 million. Debt Covenants As of March 31, 2024, LiveOne was in compliance with all covenants under the Capchase Loan and the ABL Credit Facility.
Added
The advertising exchange companies report the variable advertising revenue on a monthly basis which represents the Company’s efforts to satisfy the performance obligation.
Added
The Company earns advertising revenues primarily for fees earned from advertisement placement purchased by the customer during the time the podcast is delivered to the viewing audience, under the terms and conditions as set forth in the applicable podcasting agreement calculated using impressions..
Added
The transaction price for these contracts is measured at the estimated fair value of the non-cash consideration received unless this is not reasonably estimable, in which case the consideration is measured based on the standalone selling price of the advertising spots promised or delivered to the customer. Services received are charged to expense in the same manner.
Added
On January 28, 2025, LiveOne entered into a new Business Loan Agreement (the “2025 Business Loan Agreement”) with its then senior lender to update certain terms of its former credit facility (the “ABL Credit Facility”), including to reduce the principal amount outstanding under the promissory note underlying the facility (the “Promissory Note”) to $3,750,000, reflecting LiveOne’s repayment of the ABL Credit Facility as of such date, and to extend the maturity date of the Promissory Note to November 20, 2025.
Added
On May 19, 2025, we and LiveOne entered into a Securities Purchase Agreement (the “SPA”) with certain institutional investors (each, a “Purchaser” and collectively, the “Purchasers”), pursuant to which (i) LiveOne sold to the Purchasers our Original Issue Discount Senior Secured Convertible Debentures (the “Initial Debentures”) in an aggregate principal amount of $16,775,000 for an aggregate cash purchase price of $15,250,000, and (ii) if certain conditions are satisfied as set forth in the SPA, including at least one of the Conditions (as defined below), LiveOne may sell at its option to the Purchasers its additional Original Issue Discount Senior Secured Convertible Debentures in an aggregate principal amount of $11,000,000 on substantially the same terms as the Initial Debentures (the “Additional Debentures” and collectively with the Initial Debentures, the “Debentures”).
Added
The Debentures are convertible into shares of LiveOne’s common stock at the holder’s option at a conversion price of $2.10 per share, subject to certain customary adjustments such as stock splits, stock dividends and stock combinations.
Added
LiveOne may sell to the Purchasers the Additional Debentures if within 15 months of the Closing Date either of the following conditions have been satisfied during such 15-month period (the “Conditions”): (x) the VWAP (as defined in the SPA) of LiveOne’s common stock has been equal to or greater than $4.20 per share (subject to certain customary adjustments such as stock splits, stock dividends and stock combinations) for 30 consecutive trading days, or (y) Free Cash Flow (as defined in the SPA) has been equal to or greater to $3,000,000 for three consecutive fiscal quarters, and has increased in each of the foregoing quarters from the immediately preceding fiscal quarter.
Added
The Initial Debentures mature on May 19, 2028 and accrue interest at 11.75% per year.
Added
Commencing with the calendar month of August 2025 (subject to the following sentence), the holders of the Initial Debentures will have the right, at their option, to require LiveOne to redeem an aggregate of up to $100,000 of the outstanding principal amount of the Debentures per month.
Added
Commencing from November 18, 2025, May 18, 2026 and May 18, 2027, the holders of the Initial Debentures will have the right, at their option, to require LiveOne to redeem an aggregate of up to $150,000, $250,000 and $300,000, respectively, of the outstanding principal amount of the Initial Debentures per month.
Added
On October 1, 2024, LiveOne announced an amended relationship with our largest OEM customer. The OEM customer no longer subsidize LiveOne's services to some of its customers, however, LiveOne continues to offer all OEM customer vehicles in North America the opportunity to convert to become direct subscribers of LiveOne’s LiveOne music app.
Added
The direct subscription to the LiveOne app allows such users for the first time to access their LiveOne music and LiveOne’s other service offerings directly across all of their devices. LiveOne’s music streaming button/icon, which allows users to directly connect their subscription to LiveOne, is expected to remain in the OEM customer’s music streaming services dashboard in perpetuity.
Added
The OEM customer will continue to pay LiveOne monthly for grandfathered vehicles for the term of the OEM license agreement.
Added
Accordingly, the change in LiveOne’s relationship with the OEM customer in October 2024 is likely to cause its liquidity and cash flows to fluctuate significantly beyond March 31, 2025, which may then have an impact on our liquidity and potentially cause our liquidity to fluctuate significantly beyond March 31, 2025.
Added
LiveOne’s liquidity will depend upon its ability to convert as many of the OEM drivers as possible to become direct subscribers of its LiveOne app and the OEM customer continuing to pay for any grandfather users, as well as LiveOne’s ability to enter into new B2B agreements to provide its services that could materially contribute to our liquidity and cash flows, which may then have an impact on our liquidity and potentially cause our liquidity to fluctuate significantly.
Added
In addition, LiveOne’s liquidity will depend on its ability to negotiate with its music labels, publishers and other partners to achieve flexibility in the terms of its license agreements to match their OEM driver conversions, which may then have an impact on our liquidity and potentially cause our liquidity to fluctuate significantly.
Added
Furthermore, LiveOne’s liquidity will be dependent on its ability to repay the Debentures when due and/or pay any amounts that LiveOne has agreed to pay under the SX Settlement Agreement, which may then have an impact on our liquidity and potentially cause our liquidity to fluctuate significantly.
Added
Our long-term ability to continue as a going concern is dependent upon our ability to increase revenue, reduce costs, achieve a satisfactory level of profitable operations, and/or obtain additional sources of suitable and adequate financing. Our ability to continue as a going concern is also dependent its ability to further develop and execute on our business plan.
Added
We may also have to reduce certain overhead costs through the reduction of salaries and other means and settle liabilities through negotiation.
Added
There can be no assurance that management’s attempts at any or all of these endeavors will be successful. 72 Table of Contents Credit Agreement and Other Debt For additional information regarding our credit agreement and other debt, see “Contractual Obligations” in this Item 7 below and in the footnotes to the Consolidated Financial Statements (Notes 6,7, and 8 to our financial statements included elsewhere in this Annual Report).

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

85 edited+47 added−23 removed135 unchanged
Biggest changeConsolidated Statements of Stockholders ’ Equity (In thousands, except share and per share amounts) Additional Total Common Stock Paid in Accumulated Stockholders’ Shares Amount Capital Deficit Equity Balance as of April 1, 2023 20,000,000 $ - $ 19,785 $ (12,666 ) $ 7,119 Stock-based compensation - 3,030 - 3,030 Vested employee restricted stock units 287,500 - - - - Common stock warrants reclassed to equity - - 9,116 - 9,116 Bridge loan converted into common stock 2,340,707 - 10,276 - 10,276 Common stock dividend 504,080 - 2,213 (2,213 ) - Common stock issued for services 82,629 - 159 - 159 Contribution from parent 159,333 - 294 - 294 Common stock issued for purchase of intangibles 233,800 - 1,079 - 1,079 Net loss - - - (14,732 ) (14,732 ) Balance as of March 31, 2024 23,608,049 $ - $ 45,952 $ (29,611 ) $ 16,341 Additional Total Common Stock Paid in Accumulated Stockholders’ Shares Amount Capital Deficit Equity Balance as of April 1, 2022 147,984,230 $ - $ 18,784 $ (5,699 ) $ 13,085 Stock-based compensation - - 1,001 - 1,001 Cancellation of common stock (127,984,230 ) - - - - Net loss - - - (6,967 ) (6,967 ) Balance as of March 31, 2023 20,000,000 $ - $ 19,785 $ (12,666 ) $ 7,119 The accompanying notes are an integral part of these consolidated financial statements.
Biggest changeConsolidated Statements of Stockholders ’ Equity (In thousands, except share and per share amounts) Additional Total Common Stock Paid in Accumulated Stockholders’ Shares Amount Capital Deficit Equity Balance as of April 1, 2024 23,608,049 $ - $ 45,952 $ (29,611 ) $ 16,341 Stock-based compensation - - 1,940 - 1,940 Vested employee restricted stock units 710,565 - - - - Common stock issued for services 381,613 - 806 - 806 Contribution from parent 1,315,880 - 2,513 - 2,513 Net loss - - - (6,458 ) (6,458 ) Balance as of March 31, 2025 26,016,107 $ - $ 51,211 $ (36,069 ) $ 15,142 Additional Total Common Stock Paid in Accumulated Stockholders’ Shares Amount Capital Deficit Equity Balance as of April 1, 2023 20,000,000 $ - $ 19,785 $ (12,666 ) $ 7,119 Stock-based compensation - - 3,030 - 3,030 Vested employee restricted stock units 287,500 - - - - Common stock warrants reclassed to equity - - 9,116 - 9,116 Bridge loan converted into common stock 2,340,707 - 10,276 - 10,276 Common stock dividend 504,080 - 2,213 (2,213 ) - Common stock issued for services 82,629 - 159 - 159 Contribution from parent 159,333 - 294 - 294 Common stock issued for purchase of intangibles 233,800 - 1,079 - 1,079 Net loss - - - (14,732 ) (14,732 ) Balance as of March 31, 2024 23,608,049 $ - $ 45,952 $ (29,611 ) $ 16,341 The accompanying notes are an integral part of these consolidated financial statements.
Options Grants to the Company ’ s Employees Stock option awards are granted with an exercise price equal to the fair market value of LiveOne’s common stock at the date of grant based on the closing market price of its common stock as reported on The Nasdaq Capital Market.
LiveOne's Options Grants to the Company ’ s Employees Stock option awards are granted with an exercise price equal to the fair market value of LiveOne’s common stock at the date of grant based on the closing market price of its common stock as reported on The Nasdaq Capital Market.
PodcastOne 2022 Equity Plan On December 15, 2022, the Company’s board of directors and LiveOne as the sole stockholder, through its wholly owned subsidiary, LiveXLive PodcastOne, Inc., approved the Company’s 2022 Equity Incentive Plan (the “2022 Plan”) which reserved a total of 2,000,000 shares of the Company’s common stock for issuance.
PodcastOne 2022 Equity Incentive Plan On December 15, 2022, the Company’s board of directors and LiveOne as the sole stockholder, through its wholly owned subsidiary, LiveXLive PodcastOne, Inc., approved the Company’s 2022 Equity Incentive Plan (the “2022 Plan”) which reserved a total of 2,000,000 shares of the Company’s common stock for issuance.
LiveOne also agreed (i) not to effect a Qualified Financing or a Qualified Event, as applicable, unless immediately following such event LiveOne owns no less than 66% of the Company’s equity, unless in either case otherwise permitted by the written consent of the holders of the majority of the PC1 Notes (excluding LiveOne) (the “Majority Noteholders”) and LiveOne’s senior lender, as applicable, (ii) that until a Qualified Financing or a Qualified Event, as applicable, is consummated, LiveOne guaranteed the repayment of the PC1 Notes when due (other than the Bridge Notes issued to LiveOne) and any interest or other fees due thereunder, and (iii) that if the Company has not consummated a Qualified Financing or a Qualified Event, as applicable, by February 15, 2023, March 15, 2023 or April 15, 2023, as applicable, unless in either case permitted by the written consent of the Majority Noteholders, the Company shall be required to redeem $1,000,000 of the then outstanding PC1 Notes pro rata from the PC1 Notes holders (other than the PC1 Notes issued to LiveOne) by the tenth calendar day of each month immediately following such respective date, up to an aggregate redemption of $3,000,000 over the course of such three months, each of which shall be distributed to the holders of the PC1 Notes (other than LiveOne) on a prorated basis (the “Early Redemption”).
LiveOne also agreed (i) not to effect a Qualified Financing or a Qualified Event, as applicable, unless immediately following such event LiveOne owns no less than 66% of the Company’s equity, unless in either case otherwise permitted by the written consent of the holders of the majority of the PC1 Notes (excluding LiveOne) (the “Majority Noteholders”) and LiveOne’s senior lender, as applicable, (ii) that until a Qualified Financing or a Qualified Event, as applicable, is consummated, LiveOne guaranteed the repayment of the PC1 Notes when due (other than the Bridge Notes issued to LiveOne) and any interest or other fees due thereunder, and (iii) that if the Company has not consummated a Qualified Financing or a Qualified Event, as applicable, by February 15, 2023, March 15, 2023 or April 15, 2023, as applicable, unless in either case permitted by the written consent of the Majority Noteholders, the Company was required to redeem $1,000,000 of the then outstanding PC1 Notes pro rata from the PC1 Notes holders (other than the PC1 Notes issued to LiveOne) by the tenth calendar day of each month immediately following such respective date, up to an aggregate redemption of $3,000,000 over the course of such three months, each of which shall be distributed to the holders of the PC1 Notes (other than LiveOne) on a prorated basis (the “Early Redemption”).
F- 17 Table of Contents Note 6 — Bridge Loan Private Placement On July 15, 2022 ( the “Closing Date”), the Company completed a private placement offering (the “PC1 Bridge Loan”) of its unsecured convertible notes with an original issue discount of 10% (the “OID”) in the aggregate principal amount of $8.8 million (the “PC1 Notes”) to certain accredited investors and institutional investors (collectively, the “Purchasers”), for cash proceeds of $7.4 million, net of placement agent fees of $0.7 million, pursuant to the Subscription Agreements entered into with the Purchasers (the “Subscription Agreements”).
F- 17 Table of Contents Note 6 — Bridge Loan Private Placement On July 15, 2022, the Company completed a private placement offering (the “PC1 Bridge Loan”) of its unsecured convertible notes with an original issue discount of 10% (the “OID”) in the aggregate principal amount of $8.8 million (the “PC1 Notes”) to certain accredited investors and institutional investors (collectively, the “Purchasers”), for cash proceeds of $7.4 million, net of placement agent fees of $0.7 million, pursuant to the Subscription Agreements entered into with the Purchasers (the “Subscription Agreements”).
Stock-Based Compensation Stock-based compensation is allocated to the Company from its parent LiveOne based on the amount of stock-based compensation granted to employees of the Company in the form of stock-based compensation of LiveOne in accordance with SAB Topic 1 -B “ Allocations of Expenses and Related Disclosures in Financial Statements of Subsidiaries, Divisions or Lesser Business Components of Another Entity .” LiveOne and the Company measure stock-based compensation cost at the grant date based on the fair value of the award and is recognized as expense over the requisite service period, which is the vesting period, on an accelerated basis.
Stock-Based Compensation Stock-based compensation is allocated to the Company from its parent LiveOne based on the amount of stock-based compensation granted to employees of the Company in the form of stock-based compensation of LiveOne in accordance with SAB Topic 1 -B “ Allocations of Expenses and Related Disclosures in Financial Statements of Subsidiaries, Divisions or Lesser Business Components of Another Entity .” LiveOne and the Company measures stock-based compensation cost at the grant date based on the fair value of the award and is recognized as expense over the requisite service period, which is the vesting period, on an accelerated basis.
The authoritative guidance to allocate such costs is set forth in Staff Accounting Bulletin, or SAB Topic 1 -B “ Allocations of Expenses and Related Disclosures in Financial Statements of Subsidiaries, Divisions or Lesser Business Components of Another Entity .” Had the Company been operating on a stand-alone basis, the cost allocated would not be materially different for the years ended March 31, 2024 and 2023, respectively.
The authoritative guidance to allocate such costs is set forth in Staff Accounting Bulletin, or SAB Topic 1 -B “ Allocations of Expenses and Related Disclosures in Financial Statements of Subsidiaries, Divisions or Lesser Business Components of Another Entity .” Had the Company been operating on a stand-alone basis, the cost allocated would not be materially different for the years ended March 31, 2025 and 2024 , respectively.
Financial Statements and Supplementary Data Report of Independent Registered Public Accounting Firm (Macias Gini & O ’ Connell LLP ; Los Angeles, California ; PCAOB ID#324) F-2 Consolidated Balance Sheets as of March 31, 2024 and 2023 F-3 Consolidated Statements of Operations for the years ended March 31, 2024 and 2023 F-4 Consolidated Statements of Stockholders ’ Deficit for the years ended March 31, 2024 and 2023 F-5 Consolidated Statements of Cash Flows for the years ended March 31, 2024 and 2023 F-6 Notes to the Consolidated Financial Statements F-7 F-1 Table of Contents Report of Independent Registered Public Accounting Firm To the Board of Directors and Shareholder of PodcastOne, Inc.
Financial Statements and Supplementary Data Report of Independent Registered Public Accounting Firm (Macias Gini & O ’ Connell LLP ; Los Angeles, California ; PCAOB ID#324) F-2 Consolidated Balance Sheets as of March 31, 2025 and 2024 F-3 Consolidated Statements of Operations for the years ended March 31, 2025 and 2024 F-4 Consolidated Statements of Stockholders ’ Deficit for the years ended March 31, 2025 and 2024 F-5 Consolidated Statements of Cash Flows for the years ended March 31, 2025 and 2024 F-6 Notes to the Consolidated Financial Statements F-7 F-1 Table of Contents Report of Independent Registered Public Accounting Firm To the Board of Directors and Shareholder of PodcastOne, Inc.
The PC1 Notes shall automatically convert into the securities of the Company sold in a Qualified Financing (an initial public offering of the Company’s securities from which the Company’s trading market at the closing of such offering is a national securities exchange) or Qualified Event (a direct listing of the Company’s securities on a national securities exchange (the “Direct Listing”)), as applicable, upon the closing of a Qualified Financing or Qualified Event, as applicable, at a price per share equal to the lesser of (i) the price equal to $60.0 million divided by the aggregate number of shares of the Company’s common stock outstanding immediately prior to the closing of a Qualified Financing or Qualified Event, as applicable (assuming full conversion or exercise of all convertible and exercisable securities of the Company then outstanding, subject to certain exceptions), and (ii) 70% of the offering price of the shares (or whole units, as applicable) in the Qualified Financing or 70% of the initial listing price of the shares on a national securities exchange in the Qualified Event, as applicable.
The PC1 Notes automatically convert into the securities of the Company sold in a Qualified Financing (an initial public offering of the Company’s securities from which the Company’s trading market at the closing of such offering is a national securities exchange) or Qualified Event (a direct listing of the Company’s securities on a national securities exchange), as applicable, upon the closing of a Qualified Financing or Qualified Event, as applicable, at a price per share equal to the lesser of (i) the price equal to $60.0 million divided by the aggregate number of shares of the Company’s common stock outstanding immediately prior to the closing of a Qualified Financing or Qualified Event, as applicable (assuming full conversion or exercise of all convertible and exercisable securities of the Company then outstanding, subject to certain exceptions), and (ii) 70% of the offering price of the shares (or whole units, as applicable) in the Qualified Financing or 70% of the initial listing price of the shares on a national securities exchange in the Qualified Event, as applicable.
The derivative liabilities are recognized at fair value on a recurring basis at March 31, 2023 and are Level 3 measurements. There have been no transfers between levels. Concentration of Credit Risk The Company maintains cash balances at commercial banks. Cash balances commonly exceed the $250,000 amount insured by the Federal Deposit Insurance Corporation.
The derivative liabilities are recognized at fair value on a recurring basis at March 31, 2025 and are Level 3 measurements. There have been no transfers between levels. Concentration of Credit Risk The Company maintains cash balances at commercial banks. Cash balances commonly exceed the $250,000 amount insured by the Federal Deposit Insurance Corporation.
The Company believes that the credit risk with respect to trade receivables is limited due to the large and established nature of its largest customers and the nature of its membership receivables.
The Company believes that the credit risk with respect to trade receivables is limited due to the large and established nature of its largest customers and the nature of its receivables.
The amounts recorded for related party transactions with LiveOne may not be considered arm’s length transactions and therefore, the financial statements may not necessarily reflect the Company’s results of operations, financial position and cash flows had the Company engaged in such transactions with an unrelated third party during the years ended March 31, 2024 and 2023.
The amounts recorded for related party transactions with LiveOne may not be considered arm’s length transactions and therefore, the financial statements may not necessarily reflect the Company’s results of operations, financial position and cash flows had the Company engaged in such transactions with an unrelated third party during the years ended March 31, 2025 and 2024 .
F-6 Table of Contents PODCASTONE, INC. Notes to the Consolidated Financial Statements for the Years Ended March 31, 2024 and 2023 Note 1 — Organization and Basis of Presentation Organization PodcastOne, Inc. (“we,” “us,” “our,” the “Company” or “PodcastOne”) is a Delaware corporation headquartered in Beverly Hills, California.
F-6 Table of Contents PODCASTONE, INC. Notes to the Consolidated Financial Statements for the Years Ended March 31, 2025 and 2024 Note 1 — Organization and Basis of Presentation Organization PodcastOne, Inc. (“we,” “us,” “our,” the “Company” or “PodcastOne”) is a Delaware corporation headquartered in Beverly Hills, California.
In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of March 31, 2024 and 2023, and the results of its operations and its cash flows for each of the two years then ended, in conformity with accounting principles generally accepted in the United States of America.
In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of March 31, 2025 and 2024, and the results of its operations and its cash flows for each of the two years then ended, in conformity with accounting principles generally accepted in the United States of America.
Based on the Company’s annual impairment assessment, no impairments of goodwill were identified during the years ended March 31, 2024 and 2023, respectively. Estimations and assumptions regarding, future performance, results of the Company’s operations and comparability of its market capitalization and net book value will be used.
Based on the Company’s annual impairment assessment, no impairments of goodwill were identified during the years ended March 31, 2025 and 2024 , respectively. Estimations and assumptions regarding, future performance, results of the Company’s operations and comparability of its market capitalization and net book value will be used.
In connection with the sale of the PC1 Notes, the Purchasers received warrants (the “PC1 Warrants”) to purchase a number of shares (the “PC1 Warrant Shares”) of the Company’s common stock. The PC1 Notes mature on July 15, 2023, subject to a one -time three -month extension at the Company’s election (the “Maturity Date”).
In connection with the sale of the PC1 Notes, the Purchasers received warrants (the “PC1 Warrants”) to purchase a number of shares (the “PC1 Warrant Shares”) of the Company’s common stock. The PC1 Notes were scheduled to mature on July 15, 2023, subject to a one -time three -month extension at the Company’s election (the “Maturity Date”).
On September 17, 2020, LiveOne’s stockholders approved the amendment to the 2016 Plan to increase the number of shares available for issuance under the 2016 Plan by 5,000,000 shares increasing the total up to 17,600,000 shares, which increase was formally adopted by LiveOne on June 29, 2021.
On September 17, 2020, LiveOne’s stockholders approved the amendment to the 2016 Plan to increase the number of shares available for issuance under the 2016 Plan by 5,000,000 shares increasing the total up to 17,600,000 shares, which increase was formally adopted by LiveOne in June 2021.
(a subsidiary of LiveOne, Inc.) (the “Company”) as of March 31, 2024 and 2023, the related consolidated statements of operations, stockholders' equity and cash flows for each of the two years then ended, and the related notes to the consolidated financial statements (collectively, the “financial statements”).
(a subsidiary of LiveOne, Inc.) (the “Company”) as of March 31, 2025 and 2024, the related consolidated statements of operations, stockholders' equity and cash flows for each of the two years then ended, and the related notes to the consolidated financial statements (collectively, the “financial statements”).
Basis of Presentation The results of operations and financial position of the Company are consolidated with LiveOne’s financial statements and these financial statements have been derived as if the Company had operated on a standalone basis during the years ended March 31, 2024 and 2023.
Basis of Presentation The results of operations and financial position of the Company are consolidated with LiveOne’s financial statements and these financial statements have been derived as if the Company had operated on a standalone basis during the years ended March 31, 2025 and 2024 .
During the year ended March 31, 2024, the Company began to issue equity awards in the form of RSUs directly to its employees under the 2022 PODC Equity Incentive Plan that was approved in December 2022.
During the year ended March 31, 2024, the Company began to issue equity awards in the form of RSUs directly to its employees under the Company's 2022 Equity Incentive Plan that was approved in December 2022.
The expected term is computed using the simplified method as LiveOne’s and the Company's best estimate given its lack of actual exercise history. LiveOne and the Company have selected a risk-free rate based on the implied yield available on U.S. Treasury securities with a maturity equivalent to the expected term of the option.
The expected term is computed using the simplified method as LiveOne and the Company’s best estimate given its lack of actual exercise history. LiveOne and the Company has selected a risk-free rate based on the implied yield available on U.S. Treasury securities with a maturity equivalent to the expected term of the option.
In December 2023, the FASB issued ASU 2023 - 09, Income Taxes (Topic 740 ): Improvements to Income Tax Disclosures (“ASU 2023 - 09” ), which will require the Company to disclose specified additional information in its income tax rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold.
Recently Issued Accounting Pronouncements In December 2023, the FASB issued ASU 2023 - 09, Income Taxes (Topic 740 ): Improvements to Income Tax Disclosures (“ASU 2023 - 09” ), which will require the Company to disclose specified additional information in its income tax rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold.
In the absence of additional sources of liquidity, management anticipates that existing cash resources will not be sufficient to meet current operating and liquidity needs beyond June 2025.
In the absence of additional sources of liquidity, management anticipates that existing cash resources will not be sufficient to meet current operating and liquidity needs beyond June 2026.
The Company elected the extension and extended the maturity date to October 15, 2023. The PC1 Notes bear interest at a rate of 10% per annum payable on maturity.
The Company elected the extension and extended the maturity date to October 15, 2023. The PC1 Notes bore interest at a rate of 10% per annum payable on maturity.
F- 23 Table of Contents The Company’s employees were awarded options and restricted stock awards under the 2016 Plan, therefore an allocation of the share-based compensation was made to the Company from LiveOne. The Company recognized stock-based compensation expense of $3.5 million and $1.0 million during the years ended March 31, 2024 and 2023, respectively.
F- 23 Table of Contents The Company’s employees were awarded options and restricted stock awards under the 2016 Plan, therefore an allocation of the share-based compensation was made to the Company from LiveOne. The Company recognized stock-based compensation expense of $1.7 million and $3.5 million during the years ended March 31, 2025 and 2024 , respectively.
On August 28, 2023, the Company entered into a new two -year employment contract with its Chief Executive Officer for $0.4 million per year effective January 1, 2023. On a quarterly basis, the Company records the greater of the cumulative actual content acquisition costs incurred or the cumulative minimum guarantee based on forecasted usage for the minimum guarantee period.
On August 28, 2023, the Company entered into a new two -year employment contract with its President for $0.4 million per year effective January 1, 2023. On a quarterly basis, the Company records the greater of the cumulative actual content acquisition costs incurred or the cumulative minimum guarantee based on forecasted usage for the minimum guarantee period.
The total tax benefit recognized related to share-based compensation expense was none for the years ended March 31, 2024 and 2023, respectively.
The total tax benefit recognized related to share-based compensation expense was none for the years ended March 31, 2025 and 2024 , respectively.
LiveOne and the Company use a predicted volatility of its stock price during the expected life of the options that is based on the historical performance of LiveOne’s and the Company's stock price as well as including an estimate using guideline companies.
LiveOne and the Company uses a predicted volatility of its stock price during the expected life of the options that is based on the historical performance of LiveOne and the Company’s stock price as well as including an estimate using guideline companies.
F- 27 Table of Contents The components of pretax loss and income tax (benefit) expense are as follows (in thousands): Year Ended March 31, 2024 2023 Loss before income taxes: Domestic $ (14,677 ) $ (6,967 ) Foreign - - Total loss before income taxes $ (14,677 ) $ (6,967 ) The provision for income taxes consisted of the following: Current U.S.
F- 27 Table of Contents The components of pretax loss and income tax (benefit) expense are as follows (in thousands): Year Ended March 31, 2025 2024 Loss before income taxes: Domestic $ (6,434 ) $ (14,677 ) Foreign - - Total loss before income taxes $ (6,434 ) $ (14,677 ) The provision for income taxes consisted of the following: Current U.S.
As of March 31, 2024 and 2023, the Company has not accrued interest or penalties related to uncertain tax positions.
As of March 31, 2025 and 2024 , the Company has not accrued interest or penalties related to uncertain tax positions.
The Company is not be required to redeem or repay more than a total of $3,000,000 of the principal amount of the PC1 Notes as a result of the Optional Redemption, the Early Redemption and/or the Reg St Redemption.
The Company was not required to redeem or repay more than a total of $3,000,000 of the principal amount of the PC1 Notes as a result of the Optional Redemption, the Early Redemption and/or the Reg St Redemption.
Payments made to such third party attributed to the Company entering into new podcast contracts were capitalized to content creator relationship intangibles. As of March 31, 2024, the Company has capitalized $3.3 million of payments made to such third party.
Payments made to such third party attributed to the Company entering into new podcast contracts were capitalized to content creator relationship intangibles. As of March 31, 2025 , the Company has capitalized $3.2 million of payments made to such third party.
Federal $ - $ - State 55 - Foreign - - Total Current 55 - Deferred: U.S.
Federal $ - $ - State 24 55 Foreign - - Total Current 24 55 Deferred: U.S.
LiveOne and the Company account for awards with graded vesting as if each vesting tranche is valued as a separate award. LiveOne and the Company use the Black-Scholes-Merton option pricing model to determine the grant date fair value of stock options.
LiveOne and the Company accounts for awards with graded vesting as if each vesting tranche is valued as a separate award. LiveOne and the Company uses the Black-Scholes-Merton option pricing model to determine the grant date fair value of stock options.
Interest expense resulting from the amortization of the discount for the year ended March 31, 2024 and 2023 was $1.6 million and $4.1 million, respectively. Interest expense with respect to the PC1 Bridge Loan for the year ended March 31, 2024 and 2023 was $0.1 million and $0.6 million, respectively. There are no covenants associated with the PC1 Notes.
Interest expense resulting from the amortization of the discount for the year ended March 31, 2025 and 2024 was none and $1.6 million, respectively. Interest expense with respect to the PC1 Bridge Loan for the year ended March 31, 2025 and 2024 was none and $0.1 million, respectively. There are no covenants associated with the PC1 Notes.
Note 8 — Commitments and Contingencies Contractual Obligations As of March 31, 2024, the Company is obligated under agreements with its content providers and other contractual obligations to make guaranteed payments as follows: $6.6 million, $0.6 million, $0.5 million and $0.5 million for the fiscal year ending March 31, 2025, 2026, 2027 and 2028, respectively.
Note 8 — Commitments and Contingencies Contractual Obligations As of March 31, 2025 , the Company is obligated under agreements with its content providers and other contractual obligations to make guaranteed payments as follows: $1.3 million, $0.1 million and $0.1 million for the fiscal year ending March 31, 2026, 2027 and 2028, respectively.
As of March 31, 2024 there were 3,114,000 common stock warrants issued and outstanding.
As of March 31, 2025 there were 3,114,000 common stock warrants issued and outstanding.
The following table provides amounts included in cash and cash equivalents presented in the Company’s consolidated statements of cash flows for the years ended March 31, 2024 and 2023 (in thousands): March 31, March 31, 2024 2023 Total cash and cash equivalents $ 1,445 $ 3,562 Accounts Receivable The Company evaluates the collectability of its accounts receivable based on a combination of factors.
The following table provides amounts included in cash and cash equivalents presented in the Company’s consolidated statements of cash flows for the years ended March 31, 2025 and 2024 (in thousands): March 31, March 31, 2025 2024 Total cash and cash equivalents $ 1,079 $ 1,445 Accounts Receivable The Company evaluates the collectability of its accounts receivable based on a combination of factors.
Note 12 — Income Tax Provision The Company’s income tax provision can be affected by many factors, including the overall level of pre-tax income, the mix of pre-tax income generated across the various jurisdictions in which the Company operates, changes in tax laws and regulations in those jurisdictions, changes in valuation allowances on its deferred tax assets, tax planning strategies available to the Company, and other discrete items.
F- 26 Table of Contents Note 11 — Income Tax Provision The Company’s income tax provision can be affected by many factors, including the overall level of pre-tax income, the mix of pre-tax income generated across the various jurisdictions in which the Company operates, changes in tax laws and regulations in those jurisdictions, changes in valuation allowances on its deferred tax assets, tax planning strategies available to the Company, and other discrete items.
Of the $9.9 million of federal net operating loss carryforwards, $3.5 million was generated in tax years beginning before March 31, 2018 and is subject to the 20 -year carryforward period (“pre-Tax Act losses”), the remaining $8.8 million can be carried forward indefinitely but is subject to the 80% taxable income limitation.
Of the $13.0 million of federal net operating loss carryforwards, $3.5 million was generated in tax years beginning before March 31, 2018 and is subject to the 20 -year carryforward period, the remaining $8.8 million can be carried forward indefinitely but is subject to the 80% taxable income limitation.
The $1.3 million change in the fair value of the Redemption Liability derivative is recorded as an expense and included in other expenses in the accompanying consolidated statements of operations for the year ended March 31, 2024. The fair value of the Redemption Liability at March 31, 2023 was $2.0 million.
The $1.3 million change in the fair value of the Redemption Liability derivative is recorded as an expense and included in other expenses in the accompanying consolidated statements of operations for the year ended March 31, 2024.
The intrinsic value of options to employees outstanding and options to employees exercisable was none and none, respectively, at March 31, 2024 and 2023, respectively. The intrinsic value of options exercised was none and none, respectively, at March 31, 2024 and 2023.
The intrinsic value of options to employees outstanding and options to employees exercisable was none and none, respectively, at March 31, 2025 and 2024 , respectively.
F- 21 Table of Contents Parent Company Debt The senior credit facility held by the Company’s parent, LiveOne, contains provisions that limit the Company’s operating activities, including covenant relating to the requirement to maintain a certain amount cash at LiveOne of $7.0 million (as was subsequently reduced and maybe adjusted from time to time).
F- 21 Table of Contents Parent Company Debt The senior credit facility held by the Company’s parent, LiveOne, contains provisions that limit the Company’s operating activities, including covenant relating to the requirement to maintain a certain amount cash at LiveOne of $5.0 million (maybe adjusted from time to time).
Recently Issued Accounting Pronouncements In November 2023, the FASB issued ASU 2023 - 07, Segment Reporting (Topic 280 ): Improvements to Reportable Segment Disclosures to update reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses and information used to assess segment performance.
F- 14 Table of Contents Recently Adopted Accounting Pronouncements In November 2023, the FASB issued ASU 2023 - 07, Segment Reporting (Topic 280 ): Improvements to Reportable Segment Disclosures to update reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses and information used to assess segment performance.
F- 11 Table of Contents The Company’s accounts receivable at March 31, 2024 and 2023 are as follows (in thousands): March 31, March 31, 2024 2023 Accounts receivable, gross $ 6,099 $ 7,062 Less: Allowance for credit losses (76 ) (186 ) Accounts receivable, net $ 6,023 $ 6,876 Related Party Receivable and Payables LiveOne has historically maintained a lending relationship with the Company in order to supplement the Company’s working capital needs.
F- 11 Table of Contents The Company’s accounts receivable at March 31, 2025 and 2024 are as follows (in thousands): March 31, March 31, 2025 2024 Accounts receivable, gross $ 6,318 $ 6,099 Less: Allowance for credit losses (72 ) (76 ) Accounts receivable, net $ 6,246 $ 6,023 Related Party Receivable and Payables LiveOne has historically maintained a lending relationship with the Company in order to supplement the Company’s working capital needs.
As of March 31, 2024 and 2023, the net payable and receivable was $0.2 million and $1.5 million, respectively. LiveOne and the Company does not charge interest on these borrowings. Property and Equipment Property and equipment are recorded at cost. Costs of improvements that extend the economic life or improve service potential are also capitalized.
As of March 31, 2025 and 2024 , the net payable from the Company to LiveOne was $0.2 million and $0.3 million, respectively. LiveOne does not charge interest on these borrowings. Property and Equipment Property and equipment are recorded at cost. Costs of improvements that extend the economic life or improve service potential are also capitalized.
Los Angeles, CA July 1, 2024 PCAOB ID No. 324 F-2 Table of Contents PODCASTONE, INC.
Los Angeles, CA July 2, 2025 PCAOB ID No. 324 F-2 Table of Contents PODCASTONE, INC.
As of March 31, 2024 and 2023, the Company had a related party payable owed to LiveOne of $0.3 million and $2.3 million, respectively which primarily consisted of expenses related to overhead expenses paid on behalf of the Company (See Note 2 – Summary of Significant Accounting Policies).
F- 20 Table of Contents As of March 31, 2025 and 2024 , the Company had a related party payable owed to LiveOne of $0.5 million and $0.3 million, respectively, which primarily consisted of expenses related to overhead expenses paid on behalf of the Company (See Note 2 – Summary of Significant Accounting Policies).
Accordingly, the Company did not recognize any benefit from income taxes in the accompanying consolidated statements of operations to offset its pre-tax losses. The valuation allowance against deferred tax assets is $3.8 million and $3.5 million for the years ended March 31, 2024 and 2023, respectively. The valuation allowance increased by $0.3 million for the year ended March 31, 2024.
Accordingly, the Company did not recognize any benefit from income taxes in the accompanying consolidated statements of operations to offset its pre-tax losses. The valuation allowance against deferred tax assets is $4.8 million and $3.8 million for the years ended March 31, 2025 and 2024 , respectively.
F- 28 Table of Contents Significant components of the Company’s deferred income tax assets and (liabilities) are as follows as of (in thousands): Year Ended March 31, 2024 2023 Deferred tax assets: Net operating loss carryforwards $ 2,941 $ 3,261 Reserves and allowances 21 52 Accrued liabilities 165 111 Charitable contribution carryforward 660 43 Gross deferred tax assets 3,787 3,467 Valuation allowance (3,787 ) (3,467 ) Net deferred tax liability $ - $ - As the ultimate realization of the potential benefits of a portion of the Company’s deferred tax assets is considered unlikely by management, the Company has offset the deferred tax assets attributable to those potential benefits through valuation allowances.
F- 28 Table of Contents Significant components of the Company’s deferred income tax assets and (liabilities) are as follows as of (in thousands): Year Ended March 31, 2025 2024 Deferred tax assets: Net operating loss carryforwards $ 3,732 $ 2,941 Reserves and allowances 20 21 Accrued liabilities 151 165 Charitable contribution carryforward 946 660 Gross deferred tax assets 4,849 3,787 Valuation allowance (4,849 ) (3,787 ) Net deferred tax liability $ - $ - As the ultimate realization of the potential benefits of a portion of the Company’s deferred tax assets is considered unlikely by management, the Company has offset the deferred tax assets attributable to those potential benefits through valuation allowances.
The following table provides information about LiveOne’s restricted stock units grants made to the Company’s employees during the last two fiscal years: Year Ended March 31, 2024 2023 Number of units granted 320,000 265,000 Weighted-average grant date fair value per share $ 1.75 $ 1.10 The following table summarizes the activity of LiveOne’s restricted stock units issued to the Company’s employees during the year ended March 31, 2024 and 2023: Number of Shares Outstanding as of April 1, 2022 378,125 Granted 265,000 Vested (375,000 ) Cancelled (5,625 ) Outstanding as of March 31, 2023 262,500 Granted 320,000 Vested (400,000 ) Cancelled - Outstanding as of March 31, 2024 182,500 The fair value of restricted stock units that vested during the years ended March 31, 2024 and 2023 was $0.6 million and $1.3 million, respectively.
The following table provides information about LiveOne’s restricted stock units grants made to the Company’s employees during the last two fiscal years: Year Ended March 31, 2025 2024 Number of units granted 50,000 320,000 Weighted-average grant date fair value per share $ 1.10 $ 1.75 The following table summarizes the activity of LiveOne’s restricted stock units issued to the Company’s employees during the years ended March 31, 2025 and 2024 : Number of Shares Outstanding as of April 1, 2023 262,500 Granted 320,000 Vested (400,000 ) Cancelled - Outstanding as of March 31, 2024 182,500 Granted 50,000 Vested (194,167 ) Cancelled - Outstanding as of March 31, 2025 38,333 The fair value of restricted stock units that vested during the years ended March 31, 2025 and 2024 was $0.3 million and $0.6 million, respectively.
The following table presents the changes in the carrying amount of goodwill for the year ended March 31, 2024 ( in thousands): Goodwill Balance as of March 31, 2023 $ 12,041 Acquisitions - Balance as of March 31, 2024 $ 12,041 Finite-Lived Intangible Assets The Company’s finite-lived intangible assets were as follows as of March 31, 2024 ( in thousands): Gross Net Carrying Accumulated Carrying Value Amortization Value Content creator relationships $ 4,082 $ 1,568 $ 2,514 Brand and trade names 1,010 379 631 Total $ 5,092 $ 1,947 $ 3,145 F- 16 Table of Contents The Company’s finite-lived intangible assets were as follows as of March 31, 2023 ( in thousands): Gross Net Carrying Accumulated Carrying Value Amortization Value Content creator relationships $ 772 $ 772 $ - Brand and trade names 1,010 278 732 Total $ 1,782 $ 1,050 $ 732 The Company’s amortization expense on its finite-lived intangible assets was $0.9 million and $0.1 million for the years ended March 31, 2024 and 2023, respectively.
The following table presents the changes in the carrying amount of goodwill for the year ended March 31, 2025 (in thousands): Goodwill Balance as of March 31, 2024 $ 12,041 Acquisitions - Balance as of March 31, 2025 $ 12,041 Finite-Lived Intangible Assets The Company’s finite-lived intangible assets were as follows as of March 31, 2025 (in thousands): Gross Net Carrying Accumulated Carrying Value Amortization Value Content creator relationships $ 3,229 $ 2,573 $ 656 Brand and trade names 1,010 480 530 Total $ 4,239 $ 3,053 $ 1,186 F- 16 Table of Contents The Company’s finite-lived intangible assets were as follows as of March 31, 2024 (in thousands): Gross Net Carrying Accumulated Carrying Value Amortization Value Content creator relationships $ 4,082 $ 1,568 $ 2,514 Brand and trade names 1,010 379 631 Total $ 5,092 $ 1,947 $ 3,145 The Company’s amortization expense on its finite-lived intangible assets was $1.1 million and $0.9 million for the years ended March 31, 2025 and 2024 , respectively.
F- 15 Table of Contents Note 3 — Property and Equipment The Company’s property and equipment at March 31, 2024 and 2023 was as follows (in thousands): March 31, March 31, 2024 2023 Property and equipment, net Computer, machinery, and software equipment $ 127 $ 113 Furniture and fixtures 14 14 Leasehold improvements 91 24 Capitalized internally developed software 792 559 Total property and equipment 1,024 710 Less accumulated depreciation and amortization (715 ) (468 ) Total property and equipment, net $ 309 $ 242 Depreciation expense was $0.3 million and $0.2 million for the years ended March 31, 2024 and 2023, respectively.
F- 15 Table of Contents Note 3 — Property and Equipment The Company’s property and equipment at March 31, 2025 and 2024 was as follows (in thousands): March 31, March 31, 2025 2024 Property and equipment, net Computer, machinery, and software equipment $ 132 $ 127 Furniture and fixtures 14 14 Leasehold improvements 91 91 Capitalized internally developed software 944 792 Total property and equipment 1,181 1,024 Less accumulated depreciation and amortization (1,122 ) (715 ) Total property and equipment, net $ 59 $ 309 Depreciation expense was $0.2 million and $0.2 million for the years ended March 31, 2025 and 2024 , respectively.
The following table provides information about LiveOne’s option grants made to the Company’s employees during the last two fiscal years: Year Ended March 31, 2024 2023 Number of options granted 15,000 - Weighted-average exercise price per share $ 1.75 $ - Weighted-average grant date fair value per share $ - $ - The grant date fair value of each of these option grants to employees was determined using the Black-Scholes-Merton option-pricing model with the following assumptions: Year Ended March 31, 2024 2023 Expected volatility 83.86 % - % Dividend Yield - % - % Risk-free rate 4.12 % - % Expected term (in years) 5.88 - The following table summarizes the activity of LiveOne’s options issued to the Company’s employees during the years ended March 31, 2024 and 2023: Weighted- Average Exercise Number of Price per Shares Share Outstanding as of April 1, 2022 285,000 $ 2.93 Granted - - Exercised - - Forfeited or expired (45,000 ) 3.35 Outstanding as of March 31, 2023 240,000 2.84 Granted 15,000 1.75 Exercised - - Forfeited or expired (115,000 ) 3.88 Outstanding as of March 31, 2024 140,000 $ 1.87 Exercisable as of March 31, 2024 130,000 $ 1.64 F- 24 Table of Contents The weighted-average remaining contractual term for options to employees outstanding and options to employees exercisable as of March 31, 2024 was 7.68 years and 7.72 years, respectively.
The following table provides information about LiveOne’s option grants made to the Company’s employees during the last two fiscal years: Year Ended March 31, 2025 2024 Number of options granted 15,000 15,000 Weighted-average exercise price per share $ 0.81 $ 1.75 Weighted-average grant date fair value per share $ - $ - The grant date fair value of each of these option grants to employees was determined using the Black-Scholes-Merton option-pricing model with the following assumptions: Year Ended March 31, 2025 2024 Expected volatility 84 % 84 % Dividend Yield - % - % Risk-free rate 4 % 4 % Expected term (in years) 5.88 5.88 The following table summarizes the activity of LiveOne’s options issued to the Company’s employees during the years ended March 31, 2025 and 2024 : Weighted- Average Exercise Number of Price per Shares Share Outstanding as of April 1, 2023 240,000 $ 2.84 Granted 15,000 1.75 Exercised - - Forfeited or expired (115,000 ) 3.88 Outstanding as of March 31, 2024 140,000 1.87 Granted 15,000 0.81 Exercised - - Forfeited or expired (15,000 ) 4.20 Outstanding as of March 31, 2025 140,000 $ 1.51 Exercisable as of March 31, 2025 132,500 $ 1.43 F- 24 Table of Contents The weighted-average remaining contractual term for options to the Company's employees outstanding and options to the Company's employees exercisable as of March 31, 2025 was 6.82 years and 6.81 years, respectively.
During the year ended March 31, 2024, the Company issued 159,333 shared of its common stock with a fair value of $0.3 million in exchange for amounts owed under a cost sharing agreement between LiveOne and the Company.
During the year ended March 31, 2025 and 2024, the Company issued 1,315,880 and 159,333 shares of its common stock, respectively, with a fair value of $2.5 million and $0.3 million, respectively, in exchange for amounts owed under a cost sharing agreement between LiveOne and the Company.
On an ongoing basis, the Company evaluates its estimates compared to historical experience and trends, which form the basis for making judgments about the carrying value of assets and liabilities.
Actual results could differ materially from those estimates. On an ongoing basis, the Company evaluates its estimates compared to historical experience and trends, which form the basis for making judgments about the carrying value of assets and liabilities.
As of March 31, 2024, LiveOne, Inc. owned approximately 17.0 million shares of the Company’s common stock ( not including any shares of common stock underlying the PC1 Warrants held by LiveOne), which constituted approximately 74% of the Company’s issued and outstanding shares of common stock as of such date.
As of March 31, 2025 , LiveOne, Inc. owned approximately 18.4 million shares of the Company’s common stock ( not including any shares of common stock underlying the PC1 Warrants held by LiveOne), which constituted approximately 71% of the Company’s issued and outstanding shares of common stock as of such date.
The Company’s principal sources of liquidity have historically been its debt issuances and its cash and cash equivalents (which cash, cash equivalents amounted to $1.4 million as of March 31, 2024). The Company has an accumulated deficit of $29.6 million and had positive working capital of $0.9 million as of March 31, 2024.
The Company’s principal sources of liquidity have historically been its debt issuances and its cash and cash equivalents (which cash, cash equivalents amounted to $1.1 million as of March 31, 2025 ). The Company has an accumulated deficit of $36.1 million and had positive working capital of $1.5 million as of March 31, 2025 .
ASU 2023 - 09 will also require the Company to disaggregate its income taxes paid disclosure by federal, state and foreign taxes, with further disaggregation required for significant individual jurisdictions. The Company will adopt ASU 2023 - 09 beginning in the first quarter of 2026. ASU 2023 - 09 allows for adoption using either a prospective or retrospective transition method.
ASU 2023 - 09 will also require the Company to disaggregate its income taxes paid disclosure by federal, state and foreign taxes, with further disaggregation required for significant individual jurisdictions. The Company will adopt ASU 2023 - 09 beginning in the first quarter of 2026.
Consolidated Statements of Cash Flows (In thousands) Year Ended March 31, 2024 2023 Cash Flows from Operating Activities: Net loss $ (14,732 ) $ (6,967 ) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: Depreciation and amortization 1,148 323 Stock-based compensation 3,189 1,001 Amortization of debt discount 1,949 4,081 Change in fair value of bifurcated embedded derivatives 7,603 459 Provision for credit losses (109 ) 85 Changes in operating assets and liabilities: Accounts receivable 962 1,033 Prepaid expenses and other current assets (99 ) (462 ) Related party receivable/payables 2,032 (4,157 ) Accounts payable and accrued liabilities 182 (94 ) Other liabilities 86 - Net cash provided by (used in) operating activities 2,211 (4,698 ) Cash Flows from Investing Activities: Purchases of property and equipment (318 ) (219 ) Purchase of intangible assets (1,010 ) - Net cash used in investing activities (1,328 ) (219 ) Cash Flows from Financing Activities: Payments on bridge loan (3,000 ) - Proceeds from bridge loan - 7,376 Net cash (used in) provided by financing activities (3,000 ) 7,376 Net change in cash and cash equivalents (2,117 ) 2,459 Cash and cash equivalents, beginning of period 3,562 1,103 Cash and cash equivalents, end of period $ 1,445 $ 3,562 Supplemental disclosure of cash flow information: Cash paid for income taxes $ - $ - Cash paid for interest $ - $ - Supplemental disclosure of non-cash investing and financing activities: Common stock issued in exchange for the purchase of intangibles $ 1,079 $ - Purchase of intangibles accrued for at period end $ 1,221 $ - Common stock issued in connection with repayment of intercompany balance $ 294 $ - Common stock issued in connection with the conversion of the bridge loan $ 10,276 $ - Common stock issued in connection with the conversion of accrued interest on the bridge loan $ 918 $ - Common stock dividend $ 2,213 $ - Warrants classified from liabilities to equity $ 9,116 $ - Derivative exchanged into common stock associated with the bridge loan $ 3,254 $ - Fair value of warrant and derivative liability issued with debt instrument $ - $ 4,308 The accompanying notes are an integral part of these consolidated financial statements.
Consolidated Statements of Cash Flows (In thousands) Year Ended March 31, 2025 2024 Cash Flows from Operating Activities: Net loss $ (6,458 ) $ (14,732 ) Adjustments to reconcile net loss to net cash (used in) provided by operating activities: Depreciation and amortization 1,338 1,148 Stock-based compensation 2,747 3,189 Amortization of debt discount - 1,949 Change in fair value of bifurcated embedded derivatives - 7,603 Impairment of fixed assets 158 - Impairment of intangibles 176 - Provision for credit losses (4 ) (109 ) Changes in operating assets and liabilities: Accounts receivable (218 ) 962 Prepaid expenses and other current assets 876 (99 ) Related party receivable/payables 2,415 2,032 Accounts payable and accrued liabilities (1,196 ) 182 Other liabilities (46 ) 86 Net cash (used in) provided by operating activities (212 ) 2,211 Cash Flows from Investing Activities: Purchases of property and equipment (154 ) (318 ) Purchase of intangible assets - (1,010 ) Net cash used in investing activities (154 ) (1,328 ) Cash Flows from Financing Activities: Payments on bridge loan - (3,000 ) Net cash used in financing activities - (3,000 ) Net change in cash and cash equivalents (366 ) (2,117 ) Cash and cash equivalents, beginning of period 1,445 3,562 Cash and cash equivalents, end of period $ 1,079 $ 1,445 Supplemental disclosure of cash flow information: Cash paid for income taxes $ - $ - Cash paid for interest $ - $ - Supplemental disclosure of non-cash investing and financing activities: Common stock issued in exchange for the purchase of intangibles $ - $ 1,079 Purchase of intangibles accrued for at period end $ - $ 1,221 Common stock issued in connection with repayment of intercompany balance $ 2,513 $ 294 Common stock issued in connection with the conversion of the bridge loan $ - $ 10,276 Common stock issued in connection with the conversion of accrued interest on the bridge loan $ - $ 918 Common stock dividend $ - $ 2,213 Warrants classified from liabilities to equity $ - $ 9,116 Derivative exchanged into common stock associated with the bridge loan $ - $ 3,254 Accrued expenses written off associated with intangible asset impairment $ 695 $ - The accompanying notes are an integral part of these consolidated financial statements.
F- 25 Table of Contents The following table summarizes the activity of the Company's restricted stock units issued to employees under the 2022 Plan during the years ended March 31, 2024: Number of Shares Nonvested as of March 31, 2023 - Granted 879,060 Vested (287,500 ) Forfeited or expired - Nonvested as of March 31, 2024 591,560 As of March 31, 2024, the Company recognized $1.3 million of stock compensation for vested restricted stock units.
F- 25 Table of Contents The following table summarizes the activity of the Company's restricted stock units issued to employees under the 2022 Plan during the years ended March 31, 2025 : Number of Shares Outstanding as of April 1, 2023 - Granted 879,060 Vested (287,500 ) Forfeited or expired - Outstanding as of March 31, 2024 591,560 Granted 485,967 Vested (795,927 ) Forfeited or expired (49,250 ) Nonvested as of March 31, 2025 232,350 During the year ended March 31, 2025 , the Company recognized $2.2 million of stock compensation for vested restricted stock units.
The Company expects to record amortization of intangible assets for fiscal years ending March 31, 2024 and future fiscal years as follows (in thousands): For Years Ending March 31, 2025 $ 1,416 2026 1,063 2027 338 2028 101 2029 101 Thereafter 126 $ 3,145 Note 5 — Accounts Payable and Accrued Liabilities Accounts payable and accrued liabilities at March 31, 2024 and 2023 were as follows (in thousands): March 31, March 31, 2024 2023 Accounts payable $ 1,529 $ 1,541 Accrued revenue share 2,945 3,039 Other accrued liabilities 2,909 2,318 $ 7,383 $ 6,898 Accrued revenue share can be attributed to monies owed to content creators who contribute their podcast or other media content for the Company to sell to consumers.
The Company expects to record amortization of intangible assets for fiscal years ending March 31, 2025 and future fiscal years as follows (in thousands): For Years Ending March 31, 2026 $ 581 2027 338 2028 101 2029 101 2030 65 Thereafter - $ 1,186 Note 5 — Accounts Payable and Accrued Liabilities Accounts payable and accrued liabilities at March 31, 2025 and 2024 were as follows (in thousands): March 31, March 31, 2025 2024 Accounts payable $ 1,285 $ 1,529 Accrued revenue share 1,962 2,945 Other accrued liabilities 2,292 2,909 $ 5,539 $ 7,383 Accrued revenue share can be attributed to monies owed to content creators who contribute their podcast or other media content for the Company to sell to consumers.
From time to time we enter into barter transactions involving advertising provided in exchange for goods and services. Revenue from barter transactions is recognized ratably over time based on the terms of the contract as delivery of impressions is performed on a consistent basis. Services received are charged to expense in the same manner.
From time to time the Company enters into barter transactions involving advertising provided in exchange for goods and services. Revenue from barter transactions is recognized ratably over time based on the terms of the contract as delivery of impressions is performed on a consistent basis.
If the carrying value of an asset group is not recoverable, the Company recognizes an impairment loss for the excess carrying value over the fair value in its consolidated statements of operations. No impairment losses have been recorded during the years ended March 31, 2024 and 2023, respectively.
If the carrying value of an asset group is not recoverable, the Company recognizes an impairment loss for the excess carrying value over the fair value in its consolidated statements of operations. The Company recorded an impairment loss of $0.2 million and none during the years ended March 31, 2025 and 2024 , respectively.
The fair value of stock options outstanding and exercisable at March 31, 2024 was $0.3 million and $0.2 million, respectively. The fair value of stock options outstanding and exercisable at March 31, 2023 was $0.7 million and $0.3 million, respectively.
The intrinsic value of options exercised was none and none, at March 31, 2025 and 2024 The fair value of stock options outstanding and exercisable at March 31, 2025 was $0.2 million and $0.2 million, respectively. The fair value of stock options outstanding and exercisable at March 31, 2024 was $0.3 million and $0.2 million, respectively.
Unrecognized compensation costs for unvested PodcastOne restricted stock units issued to employees was $1.9 million, which is expected to be recognized over a weighted-average service period of 0.97 years.
Unrecognized compensation costs for unvested PodcastOne restricted stock units issued to employees was $0.3 million for the year ended March 31, 2025, which is expected to be recognized over a weighted-average service period of 1.29 years.
Federal (419 ) 338 State 99 (1,423 ) Foreign 320 1,085 Total Deferred - - Total provision for income taxes $ 55 $ - The differences between income taxes expected at U.S. statutory income tax rates and the income tax provision are as follows (in thousands): Year Ended March 31, 2024 2023 Income taxes computed at Federal statutory rate $ (3,082 ) $ (872 ) State tax — net of federal benefit 79 (60 ) Nondeductible expenses 496 559 Derivative gain 1,597 - Federal NOL true-up 522 - Change in valuation allowance 321 1,084 Stock compensation 162 192 Other (40 ) (903 ) Total provision for income taxes $ 55 $ - At March 31, 2024, the Company had available federal and state net operating loss carryforwards to reduce future taxable income of approximately $9.9 million and $17.1 million, respectively.
Federal (899 ) (419 ) State (163 ) 99 Foreign 1,062 320 Total Deferred - - Total provision for income taxes $ 24 $ 55 The differences between income taxes expected at U.S. statutory income tax rates and the income tax provision are as follows (in thousands): Year Ended March 31, 2025 2024 Income taxes computed at Federal statutory rate $ (1,291 ) $ (3,082 ) State tax — net of federal benefit (174 ) 79 Nondeductible expenses - 496 Derivative gain - 1,597 Federal NOL true-up 31 522 Change in valuation allowance 1,063 321 Stock compensation 181 162 Other 214 (40 ) Total provision for income taxes $ 24 $ 55 At March 31, 2025 , the Company had available federal and state net operating loss carryforwards to reduce future taxable income of approximately $13.0 million and $14.5 million, respectively.
Restricted Stock Units Grants As of March 31, 2024, unrecognized compensation costs for unvested awards to employees was $0.2 million, which is expected to be recognized over a weighted-average service period of 0.93 years.
Restricted Stock Units Grants to the Company's Employees As of March 31, 2025 , unrecognized compensation costs for unvested LiveOne restricted stock unit awards to the Company's employees was less than $0.1 million, which is expected to be recognized over a weighted-average service period of 1.39 years.
Consolidated Statements of Operations (In thousands, except share and per share amounts) Year Ended March 31, 2024 2023 Revenue: $ 43,302 $ 34,645 Operating expenses: Cost of sales 37,326 27,579 Sales and marketing 4,558 5,174 Product development 85 312 General and administrative 5,448 3,316 Amortization of intangible assets 896 99 Total operating expenses 48,313 36,480 Loss from operations (5,011 ) (1,835 ) Other income (expense): Interest expense, net (2,247 ) (4,674 ) Change in fair value of bifurcated embedded derivatives (7,603 ) (459 ) Other income (expense) 184 1 Total other (expense) income, net (9,666 ) (5,132 ) Loss before provision for income taxes (14,677 ) (6,967 ) Provision for income taxes 55 - Net loss $ (14,732 ) $ (6,967 ) Net loss per share – basic and diluted $ (0.68 ) $ (0.06 ) Weighted average common shares – basic and diluted 21,767,810 110,816,207 The accompanying notes are an integral part of these consolidated financial statements.
Consolidated Statements of Operations (In thousands, except share and per share amounts) Year Ended March 31, 2025 2024 Revenue: $ 52,119 $ 43,302 Operating expenses: Cost of sales 47,394 37,326 Sales and marketing 3,479 4,558 Product development 52 85 General and administrative 6,205 5,448 Impairment of intangible and fixed assets 334 - Amortization of intangible assets 1,089 896 Total operating expenses 58,553 48,313 Loss from operations (6,434 ) (5,011 ) Other income (expense): Interest expense, net - (2,247 ) Change in fair value of bifurcated embedded derivatives - (7,603 ) Other income - 184 Total other income (expense), net - (9,666 ) Loss before provision for income taxes (6,434 ) (14,677 ) Provision for income taxes 24 55 Net loss $ (6,458 ) $ (14,732 ) Net loss per share – basic and diluted $ (0.26 ) $ (0.68 ) Weighted average common shares – basic and diluted 24,381,613 21,767,810 The accompanying notes are an integral part of these consolidated financial statements.
Significant items subject to such estimates and assumptions include revenue, allowance for doubtful accounts, the assigned value of acquired assets and assumed and contingent liabilities associated with business combinations and the related purchase price allocation, useful lives and impairment of property and equipment, intangible assets, goodwill and other assets. Actual results could differ materially from those estimates.
Significant items subject to such estimates and assumptions include revenue, allowance for doubtful accounts, the assigned value of acquired assets and assumed and contingent liabilities associated with business combinations and the related purchase price allocation, useful lives and impairment of property and equipment, intangible assets, goodwill and other assets, the fair value of the Company’s equity-based compensation awards, convertible debt and debt instruments, fair value derivatives and contingencies.
Consolidated Balance Sheets (In thousands, except share and per share amounts) March 31, March 31, 2024 2023 Assets Current Assets Cash and cash equivalents $ 1,445 $ 3,562 Accounts receivable, net 6,023 6,876 Prepaid expense and other current assets 1,105 1,006 Total Current Assets 8,573 11,444 Property and equipment, net 309 242 Goodwill 12,041 12,041 Intangible assets, net 3,145 732 Related party receivable 57 3,768 Total Assets $ 24,125 $ 28,227 Liabilities and Stockholders’ Equity Current Liabilities Accounts payable and accrued liabilities $ 7,383 $ 6,898 Bridge loan, net - 7,155 Derivative liabilities - 4,767 Related party payable 315 2,288 Total Current Liabilities 7,698 21,108 Other long-term liabilities 86 - Total Liabilities 7,784 21,108 Commitments and Contingencies Stockholders’ Equity Preferred stock, par value $ 0.00001 , 10,000,000 shares authorized, no shares issued or outstanding as of March 31, 2024 and March 31, 2023, respectively - - Common stock, $ 0.00001 par value; 100,000,000 and 200,000,000 shares authorized as of March 31, 2024 and March 31, 2023, respectively; 23,608,049 and 20,000,000 shares issued and outstanding as of March 31, 2024 and March 31, 2023, respectively - - Additional paid in capital 45,952 19,785 Accumulated deficit (29,611 ) (12,666 ) Total stockholders’ equity 16,341 7,119 Total Liabilities and Stockholders’ Equity $ 24,125 $ 28,227 The accompanying notes are an integral part of these consolidated financial statements.
Consolidated Balance Sheets (In thousands, except share and per share amounts) March 31, March 31, 2025 2024 Assets Current Assets Cash and cash equivalents $ 1,079 $ 1,445 Accounts receivable, net 6,246 6,023 Prepaid expense and other current assets 230 1,105 Total Current Assets 7,555 8,573 Property and equipment, net 59 309 Goodwill 12,041 12,041 Intangible assets, net 1,186 3,145 Related party receivable 354 57 Total Assets $ 21,195 $ 24,125 Liabilities and Stockholders’ Equity Current Liabilities Accounts payable and accrued liabilities $ 5,539 $ 7,383 Related party payable 514 315 Total Current Liabilities 6,053 7,698 Other long-term liabilities - 86 Total Liabilities 6,053 7,784 Commitments and Contingencies Stockholders’ Equity Preferred stock, par value $ 0.00001 , 10,000,000 shares authorized, no shares issued or outstanding as of March 31, 2025 and March 31, 2024, respectively - - Common stock, $ 0.00001 par value; 100,000,000 shares authorized as of March 31, 2025 and March 31, 2024, respectively; 26,016,107 and 23,608,049 shares issued and outstanding as of March 31, 2025 and March 31, 2024, respectively - - Additional paid in capital 51,211 45,952 Accumulated deficit (36,069 ) (29,611 ) Total stockholders’ equity 15,142 16,341 Total Liabilities and Stockholders’ Equity $ 21,195 $ 24,125 The accompanying notes are an integral part of these consolidated financial statements.
The Company may make discretionary matching contributions to the 401 (k) Plan on behalf of its employees up to a maximum of 100% of the participant’s elective deferral up to a maximum of 5% of the employees’ annual compensation. The Company’s matching contributions were not material to the financial statements for the years ended March 31, 2024 and 2023, respectively.
The Company may make discretionary matching contributions to the 401 (k) Plan on behalf of its employees up to a maximum of 100% of the participant’s elective deferral up to a maximum of 5% of the employees’ annual compensation.
Note 10 — Stockholders ’ Equity Prior to the Spin-Out, LiveOne, through its wholly owned subsidiary, LiveXLive PodcastOne, Inc., canceled 127,984,230 shares of the Company’s common stock.
The Company’s matching contributions were not material to the financial statements for the years ended March 31, 2025 and 2024 , respectively. Note 10 — Stockholders ’ Equity Spin-Out Prior to the Spin-Out, LiveOne, through its wholly owned subsidiary, LiveXLive PodcastOne, Inc., canceled 127,984,230 shares of the Company’s common stock.
This update is effective beginning with the Company’s 2024 fiscal year annual reporting period, with early adoption permitted. The Company is currently assessing the impact this standard will have on the Company’s consolidated financial statements.
This update is effective beginning with the Company’s 2024 fiscal year annual reporting period, with early adoption permitted. The Company adopted ASU 2023 - 07 on April 1, 2024 on a prospective basis. The adoption of this standard did not have an impact on the Company’s consolidated financial statements.
During the years ended March 31, 2024 and 2023, the Company was allocated expenses by LiveOne attributed to the overhead expenses incurred on behalf of the Company. The amount allocated to the Company from LiveOne for the years ended March 31, 2024 and 2023, was $0.7 million and $0.6 million, respectively.
The amount allocated to the Company from LiveOne for the years ended March 31, 2025 and 2024 , was $1.0 million and $0.7 million, respectively.
Note 7 — Related Party Transactions As of March 31, 2024, the Company’s parent, LiveOne, holds approximately 15.7 million shares of the Company's common stock and 1,100,000 common stock warrants to purchase shares of the Company. In addition, directors and management affiliated with LiveOne hold approximately 887,995 shares of the Company's common stock.
Note 7 — Related Party Transactions As of March 31, 2025 , the Company’s parent, LiveOne, holds approximately 18.4 million shares of the Company's common stock and 1,100,000 common stock warrants to purchase shares of the Company with an exercise price of $3.00 per share.
Cash and Cash Equivalents Cash and cash equivalents include all highly liquid investments with original maturities, when purchased, of three months or less.
All of the Company's revenue is attributable to the United States and all of the Company's assets are located in the Unites States. Cash and Cash Equivalents Cash and cash equivalents include all highly liquid investments with original maturities, when purchased, of three months or less.
Product Development Product development costs not capitalized are primarily expenses for research and development, product and content development activities, including internal software development and improvement costs which have not been capitalized by the Company.
Advertising expenses included in sales and marketing expense were $0.2 million and $0.2 million for the years ended March 31, 2025 and 2024 , respectively. Product Development Product development costs not capitalized are primarily expenses for research and development, product and content development activities, including internal software development and improvement costs which have not been capitalized by the Company.
As discussed in Note 1 to the financial statements, the Company has suffered recurring losses from operations, negative cash flows from operating activities and has a net capital deficiency These matters raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters also are described in Note 1.
Going Concern Uncertainty The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has suffered recurring losses from operations, negative cash flows from operating activities and has a net capital deficiency.
As of March 31, 2024 and 2023, the Company had a related party receivable from LiveOne of $0.1 million and $3.8 million, respectively which primarily consisted of cash allocated to LiveOne. During the years ended March 31, 2024 and 2023, the Company entered into a production agreement for a podcast and related show with an affiliate of Mr.
As of March 31, 2025 and 2024 , the Company had a related party receivable from LiveOne of $0.4 million and $0.1 million, respectively, which primarily consisted of cash allocated to LiveOne.

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