Lendway, Inc. Q3 2024: Navigating Seasonality and Acquisitions

Lendway, Inc. (NASDAQ:LDWY) recently announced its financial results for the third quarter of 2024, providing insights into the company's strategic direction and operational performance. The quarter marked a significant milestone for Lendway, with the integration of Bloomia, a major player in the fresh cut tulip market, beginning to yield revenues. However, the company still faces challenges, including seasonality in sales and rising interest expenses.



Lendway's net revenue for Q3 2024 reached $6.6 million, a substantial improvement from the previous year's third quarter, which saw no revenue from continuing operations. This growth can be attributed to the acquisition of Bloomia, which contributed all of Lendway's revenue in the quarter. The gross profit margin of 21.7% suggests operational efficiency, but the operating loss of $1.4 million indicates ongoing financial strain.



The seasonality of Bloomia's business played a significant role in Lendway's Q3 2024 financial performance. Bloomia generates the majority of its sales in the first and second calendar quarters, driven by events like Valentine's Day, Easter, and the Spring season. Consequently, revenue was expected to decline in the second half of the year, which aligns with Lendway's Q3 results.

Despite the decline in revenue, Lendway's management remains optimistic about capitalizing on the upcoming floral sales season. The company's focus on preparations for the competitive spring flower sales season suggests that it is well-positioned for strong sales in the coming months.



Acquisition-related costs and interest expenses have significantly impacted Lendway's net loss in Q3 2024. The company's net loss attributable to the company reached $1.1 million, a stark reversal from the $1.1 million profit in Q3 2023. This reversal can be largely attributed to increased operational costs and interest expenses associated with the Bloomia acquisition. Acquisition-related costs totaled $2.2 million, significantly impacting Lendway's financial performance.



In conclusion, Lendway's Q3 2024 financial results demonstrate the impact of the Bloomia acquisition on the company's revenue and gross profit margin. However, the company still faces challenges, including seasonality in sales and rising interest expenses. Despite these challenges, Lendway remains optimistic about capitalizing on the upcoming floral sales season, suggesting that the company is focused on long-term growth and sustainability. Investors should monitor Lendway's progress closely as it navigates the complexities of integration and seasonality in the fresh cut tulip market.