Creatd (CRTD) Stock: Why The Price Surged Today

By Amit Chowdhry ● Nov 16, 2021
  • The stock price of Creatd Inc (NASDAQ: CRTD) increased by over 25% pre-market today. This is why it happened.

The stock price of Creatd Inc (NASDAQ: CRTD) – a creator-first holding company and the parent company of Vocal – increased by over 25% pre-market today. Investors are responding positively to the company’s financial results for its three- and nine-month periods ended September 30, 2021.

With these record results, which saw third quarter 2021 revenues similar to the amount of revenue for the entirety of fiscal year 2020, the company reaffirmed its fiscal year 2021 revenue guidance of between $4.5 and $4.7 million. Looking ahead, Creatd initiated revenue guidance of $10 to $15 million for full year 2022.

Third Quarter and Nine Months 2021 Financial Highlights:

— In line with guidance, the net revenues for the third quarter were $1.18 million, a nearly 3-fold increase as compared to third quarter 2020 revenues of $425,000, and a 22% increase over second quarter 2021 net revenues of $971,000. The gross revenues for third quarter 2021 were $1.21 million, a 20% increase compared to gross revenues for second quarter 2021. And the increase in third quarter revenues is largely attributable to continued growth in Creatd Labs’ creator subscriptions, with Vocal creators finding increasing value from the Vocal platform. Additionally, Creatd Partners – the company’s agency business segment – saw growth this quarter of approximately 14% due in part to the successful acquisition and subsequent integration of the WHE Agency. Going forward, the company will provide total bookings and other non-GAAP financial data, for WHE as well as its other existing and future business lines, as an indicator of the Company’s revenue growth over time.

— For the 9 months ended September 30, 2021, net revenues totaled approximately $2.9 million, an increase of 178% over the prior year’s nine-month period. And for the remainder of 2021 and going forward, Creatd Labs is expected to maintain its growth momentum. Creatd Partners anticipates accelerated growth across all of its service lines, including the ramp-up of its talent representation and management function. Given its initial sales data and strong opportunity pipeline, the newly formed Creatd Ventures and Creatd Studios are expected to begin to impact the Company’s revenues materially in the first half of 2022.

— The comprehensive loss for the third quarter 2021 totaled $(9.7) million, or $(0.71) per basic and diluted share, which included several non-recurring, non-cash charges totaling approximately $3.0 million related primarily to the elimination of debt, the majority of which was converted to equity during the quarter, and a change in derivative liability expense of approximately $833,000. This compares to a comprehensive loss of $(16.2) million or $(3.81) per basic and diluted share for third quarter 2020, an 81% improvement per basic and diluted share.

Creatd Ventures DTC / e-Commerce Acquisitions:

— Dune, acquired on October 3, 2021, is a direct-to-consumer beauty brand focused on health and wellness beverages. And over the course of Q3 2021, the Creatd Labs team implemented a sophisticated ecommerce framework for Dune and provides ongoing development and maintenance. Today, Dune Glow Remedy is part of Creatd Ventures and its growing portfolio of DTC companies, utilizing the Company’s four pillars, including the influencers of the WHE Agency.

— Camp Announces Redesign and New Product Launches: Camp, formerly Plant Camp, acquired during Q2 2021, leverages the same technology framework utilized by Dune. And in early Q4 2021, the company announced the redesign of its website as well as the launch of its new products under its new name, Camp. While still a healthy kid-friendly food company that launched its first product, a nutrient-rich mac and cheese just over a year ago, it has been notably observed that Camp’s market is significantly broader with strong interest from adults. Going forward, marketing and product development will expand beyond kids to focus on iterations of comfort foods for the health-conscious consumer. With the new website and product launch, Camp increased its offerings with two new products, a healthy veggie-based vegan cheesy mac and a twist veggie pasta. Camp plans to continue to innovate new product offerings, as well as pursue expansion of its distribution beyond direct-to-consumer e-commerce to eventual placement at big box retailers.

— Crypto Strategy: “OG Gallery,” Creatd’s new NFT art platform, focuses on the tokenization, marketing, and sale of digital collectibles originating from the OG Collection, a library of over 150,000 original photographs, digital artwork, imagery, original documents, illustrations, videos, and collectables by the legendary Bob Guccione, former CEO of General Media and owner of publications including Penthouse, Viva, OMNI and Longevity.

— During Q3, Creatd issued its first NFT art offering. Eight days later, on October 1, 2021, all 6 pieces each sold for $1,000 a piece (0.34wETH).

— Creatd announced a strategic partnership with NetObjex to explore development of a proprietary NFT marketplace applying blockchain to facilitate the marketing, trading and sales process for a broader creator network.

— Subsequent to Q3: Creatd issued its second NFT release – The Trump Photographs. In the future, the OG Gallery is expected to release further NFT art of Penthouse Pets, celebrities, and illustrations from the iconic collection. For updates on upcoming NFT releases, please follow Creatd’s social media accounts and subscribe to its newsletter.

KEY QUOTES:

“As a founder and entrepreneur, it is gratifying to not only achieve proof of concept and commercialization, but to now witness revenue growth acceleration and an expansion of Creatd’s core business, first launched five years ago. Having completed our Nasdaq uplisting only a little over one year ago—a feat achieved by only a handful of tens of thousands of OTC-quoted companies each year—the achievements our company has made in a relatively short period of time are only more pronounced. Namely, we continue to experience double digit quarterly growth, as we have for five out of our last six quarters, we have completed our second agency acquisition, and we have expanded our footprint with new offices in New York and Miami.”

“I am grateful for this initial hard-won success and humbled to have attracted a stellar team of hardworking professionals and, most importantly, to share leadership with our new co-CEO Laurie Weisberg, whose ability to accelerate growth for technology companies is well-documented.”

“Creatd is entering an accelerated revenue phase with a healthy balance sheet. With our current revenue projections, we will approach cash flow breakeven in the third quarter of 2022.”

— Creatd founder and co-CEO Jeremy Frommer

“Our business development efforts are yielding visibility for a strong and growing revenue pipeline, made possible by the emphasis we have placed this quarter on recruiting incredible industry talent. These meticulously-chosen professionals and support teams are crucial to executing on our outlined growth strategies in the scope of product development, brand partnerships, and M&A activity. We look forward to working toward a strong end to the year.”

— Laurie Weisberg, Creatd’s co-CEO

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.