UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 31, 2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition Period from _________ to _________

Commission file number: 001-39785

LIFEMD, INC.

(Exact name of registrant as specified in its charter)

Delaware

76-0238453

(State or other Jurisdiction

of Incorporation or Organization)

(I.R.S. Employer

Identification No.)

236 Fifth Avenue, Suite 400

New York, New York

10001

(Address of Principal Executive Offices)

(Zip Code)

(866) 351-5907

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading symbol(s)	Name of exchange on which registered
Common Stock, par value $.01 per share	LFMD	The Nasdaq Global Market
8.875% Series A Cumulative Perpetual Preferred Stock, par value $0.0001 per share	LFMDP	The Nasdaq Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” a “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒

Non-accelerated filer	☐	Smaller reporting company	☒

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act: ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 7, 2024, there were 42,289,990 shares of the registrant’s common stock outstanding.

LIFEMD, INC.

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2024

TABLE OF CONTENTS

		Page

PART I. FINANCIAL INFORMATION

ITEM 1.	Financial Statements (unaudited)	3

	Condensed Consolidated Balance Sheets	3

	Condensed Consolidated Statements of Operations	4

	Condensed Consolidated Statements of Stockholders’ Equity (Deficit)	5

	Condensed Consolidated Statements of Cash Flows	6

	Notes to Condensed Consolidated Financial Statements	7

ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	25

ITEM 3.	Quantitative and Qualitative Disclosures about Market Risk	33

ITEM 4.	Controls and Procedures	33

PART II. OTHER INFORMATION

ITEM 1.	Legal Proceedings	35

ITEM 1A.	Risk Factors	35

ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	35

ITEM 3.	Defaults Upon Senior Securities	35

ITEM 4.	Mine Safety Disclosures	35

ITEM 5.	Other Information	35

ITEM 6.	Exhibits	36

SIGNATURES		37

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

LIFEMD, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

	March 31, 2024			December 31, 2023
	(Unaudited)
ASSETS
Current Assets
Cash	$	35,110,929		$	33,146,725
Accounts receivable, net		5,336,491			5,277,250
Product deposit		288,938			485,850
Inventory, net		2,373,640			2,759,932
Other current assets		1,298,737			934,510
Total Current Assets		44,408,735			42,604,267
Non-current Assets
Equipment, net		585,980			476,303
Right of use assets		1,674,014			594,897
Capitalized software, net		12,023,248			11,795,979
Intangible assets, net		2,763,297			3,009,263
Total Non-current Assets		17,046,539			15,876,442
Total Assets	$	61,455,274		$	58,480,709
LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current Liabilities
Accounts payable	$	12,395,032		$	11,084,855
Accrued expenses		14,555,480			13,937,494
Notes payable, net		115,907			327,597
Current operating lease liabilities		447,559			603,180
Current portion of long-term debt		3,958,333			-
Deferred revenue		13,202,757			8,828,598
Total Current Liabilities		44,675,068			34,781,724
Long-term Liabilities
Long-term debt, net		14,069,838			17,927,727
Noncurrent operating lease liabilities		1,311,452			73,849
Contingent consideration		100,000			131,250
Total Liabilities		60,156,358			52,914,550
Commitments and contingencies (Note 10)		-			-
Mezzanine Equity
Preferred Stock, $0.0001 par value; 5,000,000 shares authorized Series B Convertible Preferred Stock, $0.0001 par value; 5,000 shares authorized, zero shares issued and outstanding, liquidation value, $0 per share as of March 31, 2024 and December 31, 2023		-			-
Stockholders’ Equity (Deficit)
Series A Preferred Stock, $0.0001 par value; 1,610,000 shares authorized, 1,400,000 shares issued and outstanding, liquidation value approximately, $25.55 per share as of March 31, 2024 and December 31, 2023		140			140
Common Stock, $0.01 par value; 100,000,000 shares authorized, 40,731,676 and 38,358,641 shares issued, 40,628,636 and 38,255,601 outstanding as of March 31, 2024 and December 31, 2023, respectively		407,317			383,586
Additional paid-in capital		220,721,095			217,550,583
Accumulated deficit		(221,810,154	)		(214,265,236	)
Treasury stock, 103,040, at cost, as of March 31, 2024 and December 31, 2023		(163,701	)		(163,701	)
Total LifeMD, Inc. Stockholders’ (Deficit) Equity		(845,303	)		3,505,372
Non-controlling interest		2,144,219			2,060,787
Total Stockholders’ Equity		1,298,916			5,566,159
Total Liabilities, Mezzanine Equity and Stockholders’ Equity (Deficit)	$	61,455,274		$	58,480,709

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

LIFEMD, INC.

CONDENSED Consolidated STATEMENTS OF OPERATIONS

(Unaudited)

	2024			2023
	Three Months Ended March 31,
	2024			2023
Revenues
Telehealth revenue, net	$	30,841,402		$	20,202,803
WorkSimpli revenue, net		13,302,862			12,923,532
Total revenues, net		44,144,264			33,126,335
Cost of revenues
Cost of telehealth revenue		4,194,595			3,920,182
Cost of WorkSimpli revenue		405,582			294,787
Total cost of revenues		4,600,177			4,214,969
Gross profit		39,544,087			28,911,366

Expenses
Selling and marketing expenses		24,173,880			16,717,645
General and administrative expenses		15,305,732			10,602,763
Other operating expenses		2,300,447			1,704,765
Development costs		2,087,232			1,183,599
Customer service expenses		1,848,041			1,555,404
Total expenses		45,715,332			31,764,176
Operating loss		(6,171,245	)		(2,852,810	)
Interest expense, net		(477,678	)		(264,465	)
Loss on debt extinguishment		-			(325,198	)
Net loss		(6,648,923	)		(3,442,473	)
Net income attributable to non-controlling interest		119,432			565,983
Net loss attributable to LifeMD, Inc.		(6,768,355	)		(4,008,456	)
Preferred stock dividends		(776,563	)		(776,563	)
Net loss attributable to LifeMD, Inc. common stockholders	$	(7,544,918	)	$	(4,785,019	)
Basic loss per share attributable to LifeMD, Inc. common stockholders	$	(0.19	)	$	(0.15	)
Diluted loss per share attributable to LifeMD, Inc. common stockholders	$	(0.19	)	$	(0.15	)
Weighted average number of common shares outstanding:
Basic		39,242,237			31,680,776
Diluted		39,242,237			31,680,776

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

LIFEMD, INC.

CONDENSED Consolidated STATEMENTS of CHANGES IN STOCKHOLDERS’ EQUITY (Deficit)

(Unaudited)

	Shares		Amount		Shares		Amount		Capital			Deficit			Stock			Total			Interest			Total
	LifeMD, Inc.
	Series A Preferred Stock				Common Stock				Additional Paid-in			Accumulated			Treasury						Non- controlling
	Shares		Amount		Shares		Amount		Capital			Deficit			Stock			Total			Interest			Total
Balance, January 1, 2023		1,400,000	$	140		31,552,775	$	315,528	$	179,015,250		$	(190,562,994	)	$	(163,701	)	$	(11,395,777	)	$	(475,548	)	$	(11,871,325	)
Stock compensation expense		-		-		149,375		1,494		2,662,020			-			-			2,663,514			-			2,663,514
Stock issued for noncontingent consideration payment		-		-		337,895		3,379		638,621			-			-			642,000			-			642,000
Warrants issued with convertible debt instrument		-		-		-		-		1,088,343			-			-			1,088,343			-			1,088,343
Series A Preferred Stock Dividend		-		-		-		-		-			(776,563	)		-			(776,563	)		-			(776,563	)
Distribution to non-controlling interest		-		-		-		-		-			-			-			-			(36,000	)		(36,000	)
Adjustment of membership interest in WorkSimpli		-		-		-		-		(220,582	)		-			-			(220,582	)		(85,932	)		(306,514	)
Net (loss) income		-		-		-		-		-			(4,008,456	)		-			(4,008,456	)		565,983			(3,442,473	)
Balance, March 31, 2023		1,400,000	$	140		32,040,045	$	320,401	$	183,183,652		$	(195,348,013	)	$	(163,701	)	$	(12,007,521	)	$	(31,497	)	$	(12,039,018	)

	LifeMD, Inc.
	Series A Preferred Stock				Common Stock				Additional Paid-in		Accumulated			Treasury					Non- controlling
	Shares		Amount		Shares		Amount		Capital		Deficit			Stock			Total		Interest		Total
Balance, January 1, 2024		1,400,000	$	140		38,358,641	$	383,586	$	217,550,583	$	(214,265,236	)	$	(163,701	)	$	3,505,372	$	2,060,787	$	5,566,159
Balance		1,400,000	$	140		38,358,641	$	383,586	$	217,550,583	$	(214,265,236	)	$	(163,701	)	$	3,505,372	$	2,060,787	$	5,566,159
Stock compensation expense		-		-		943,375		9,434		2,534,996		-			-			2,544,430		-		2,544,430
Stock issued for noncontingent consideration payment		-		-		95,821		958		641,042		-			-			642,000		-		642,000
Exercise of stock options		-

SEC Form 10-Q filed by LifeMD Inc.