LQR House Inc.
For the period ended Mar 31, 2025. Filed May 13, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 13, 2025
YHC$1.51-6.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-14.
0001213900-24-098355
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-13.
0001213900-25-042634
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 68 previous paragraphs and 62 current paragraphs.
32 unchanged; 15 reworded; 15 added; 17 removed; 4 previous and 0 current paragraphs rearranged.
Tables are not compared: 18 previous and 17 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (15)
Current report
Recent Developments
Current report
On September 13, 2024, the Company entered into an at-the-market offering agreement (“ATM Agreement”) with H.C. Wainwright & Co., LLC, as sales agent (“HCW”), relating to the sale of common stock. During the first quarter of 2025 ended March 31, 2025, the Company issued an aggregate of 413,520 shares of common stock pursuant to such ATM Agreement for net proceeds of $5,178,821. The Company paid the sales agent compensation with respect to the sale of such shares in the amount of $161,608.
Current report
On April 1, 2025, we entered into a Supplementary Distribution Agreement (the “Supplementary Distribution Agreement”) with Of The Earth Distribution Corp., a Canadian corporation (the “Distributor”), pursuant to which the Company granted to Distributor the exclusive right to distribute, market, and sell SWOL Tequila products within Thailand and Greece until June 28, 2029. The Supplementary Distribution Agreement also amends Supplier Agreement between the Company and the Distributor, dated June 28, 2024, by providing the Distributor exclusive distribution rights to sell SWOL Tequila in all of Canada without any territorial limitations.
Current report
On April 2, 2025, David Lazar resigned as President and as member of our Board of Directors (the “Board”), effective immediately. In connection with such resignation, the Company issued Mr. Lazar 2,857 shares of common stock (on post-split basis), in accordance with his separation agreement with the Company.
Current report
On April 16, 2025, the Board approved and recommended for stockholder approval at the 2025 Annual Meeting of Stockholders, the proposal to adopt a Certificate of Amendment to our Articles of Incorporation (the “Certificate of Amendment”), to increase the number of authorized shares of common stock of the Company from 10,000,000 shares to 350,000,000 shares, each share of common stock having a par value of $0.0001. The Board also set the date for the Company’s 2025 Annual Meeting of Stockholders for May 30, 2025. The Certificate of Amendment will become effective upon stockholder approval.
Current report
On April 21, 2025, the Company effected a one-for-thirty-five reverse stock split of its issued, outstanding and authorized common stock (the “Reverse Stock Split”). The Reverse Stock Split became effective at 12:01 a.m. Eastern Time on April 21, 2025, and our common stock began trading on a post-split basis on April 21, 2025. No fractional shares were issued in connection with the Reverse Stock Split and fractional amounts were rounded up to the next highest whole number at the participant level.
Current report
On April 23, 2025, the Audit Committee of the Board accepted the resignation of dbbmckennon and approved the engagement of Enrome LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2025, effective immediately.
Current report
LQR House is an American online retailer of alcohol products.
Current report
ability to make profitable investments in complimentary business.
Current report
For the three months ended March 31, 2025, product revenues were $351,984 compared to $437,303 in the similar 2024 period. The decrease by $85,319 compared to 2024 was primarily attributable to a decrease in sales volume through the CWS Platform during the quarter. The reduction in revenue reflects lower customer traffic and order activity on cwsspirits.com, which the Company believes was driven by seasonal fluctuations and less promotional activity compared to the prior year period.
Current report
For the three months ended March 31, 2025 and 2024, service cost of revenues were $1,400 and $37,208, respectively. Cost of service revenues decreased by $35,808 in 2025 due to our ability to support marketing campaigns via dedicated personnel and ceased certain digital ad costs to support campaigns.
Current report
Product cost of revenues was $397,782 and $523,383 during the three months ended March 31, 2025 and 2024. The decrease was primarily due to the decline in product revenue during the period, resulting from lower sales volume on the CWS Platform.
Current report
For the three months ended March 31, 2025 and 2024, general and administrative expenses were $2,023,161 and $1,606,461, respectively. The increase was primarily attributable to higher professional fees and personnel-related costs incurred during the current period. In addition, the Company recognized approximately $868,000 in non-cash stock-based compensation expense in 2025, compared to approximately $720,000 in the prior-year period.
Current report
For the three months ended March 31, 2025 and 2024, sales and marketing expenses were $406,853 and $786,415 respectively. The decrease was primarily due to the absence of website development costs in the current period. In the first quarter of 2024, the Company recorded significant expenses related to a website development agreement with X-Media entered into in October 2023, which was fully written off during 2024. The absence of similar charges in 2025 contributed to the decline in sales and marketing expenses.
Current report
During the three months ended March 31, 2025, the Company raised an aggregate of $9,230,236 in net proceeds through issuance of commons stock. The Company issued 413,520 shares of common stock pursuant to at-the-market offering agreement, dated September 13, 2024, between the Company and H.C. Wainwright & Co., LLC, for net proceeds of $5,178,821. Additionally, the Company received net proceeds of $4,051,415 from the issuance of 210,463 shares of common stock pursuant to exercise of warrants.
Removed paragraphs (17)
Previous report
For the three months ended September 30, 2024, product revenues were $593,546 compared to $69,097 in the similar 2023 period. The increase was due to $575,115 in revenues generated from the CWS Platform after the acquisition in November 2023.
Previous report
For the three months ended September 30, 2024 and 2023, service cost of revenues were $45,870 and $97,504, respectively. Cost of service revenues decreased by $51,634 in 2024, due to decrease in service revenue in the third quarter. In 2023, cost of revenues included amortization of the marketing license, which was impaired as of December 31, 2023.
Previous report
Product cost of revenues was $640,645 and $65,388 during the three months ended September 30, 2024 and 2023. The increase was due to product and shipping costs associated with the CWS Platform acquisition in November 2023.
Previous report
For the three months ended September 30, 2024 and 2023, general and administrative expenses were $1,522,785 and $4,803,821, respectively. General and administrative expenses decreased by $3,281,036. In 2023, the Company recorded $2,552,500 in non-cash stock-based compensation expense due to the issuance of common shares for services. During the three months ended September 30, 2024 the Company recorded $720,842 in non-cash stock-based compensation expense due to vesting of restricted stock units.
Previous report
For the three months ended September 30, 2024 and 2023, sales and marketing expenses were $1,919,125 and $574,026 respectively. The increase of $1,345,099 was primarily due to advertising and marketing and investor relation campaigns beginning in late 2023 and continuing in the third quarter of 2024. During the three months ended September 30, 2024 bonus expenses were recorded $200,000 under sales and marketing.
Previous report
Comparison of Nine Months Ended September 30, 2024 and 2023
Previous report
Revenue
Previous report
For the nine months ended September 30, 2024 product revenues were $1,548,786 compared to $116,884 in the similar 2023 period. The increase was due to $1,523,546 in revenues generated from the CWS Platform after the acquisition in November 2023.
Previous report
For the nine months ended September 30, 2024 and 2023, service cost of revenues were $152,101 and $296,331 respectively. Cost of revenues services decreased by $144,230 in 2024, corresponding to the decreased revenues. In 2023, cost of revenues included amortization of the marketing license, which was impaired as of December 31, 2023.
Previous report
Product cost of revenues related was $1,805,112 and $105,519 during the nine months ended September 30, 2024 and 2023 The increase was due to product and shipping costs associated with the CWS Platform acquisition in November 2023.
Previous report
Gross profit (loss) was ($293,738) and $110,246 for the nine months ended September 30, 2024 and 2023. The Company has incurred gross losses in 2024 as it transitions its strategies from marketing contracts to product revenues via the CWS Platform. Management is exploring various strategies to increase customer acquisition, including an emphasis in organic search optimization to achieve higher revenue volumes. The Company is continuing to explore new partnerships for added revenue sources and is working towards reducing its product cost of revenues.
Previous report
General and Administrative
Previous report
For the nine months ended September 30, 2024 and 2023, general and administrative expenses were $4,486,641 and $8,684,826 respectively. General and administrative expenses decreased by $4,198,185. In 2023, the Company recorded $5,552,500 in non-cash stock-based compensation expense due to the issuance of common shares for services. During nine months ended September 30, 2024 the Company recorded $2,162,527 in non-cash stock-based compensation expense due to vesting of restricted stock units.
Previous report
Sales and Marketing
Previous report
For the nine months ended September 30, 2024 and 2023, sales and marketing expenses were $3,470,348 and $674,213 respectively. The increase of $2,796,135 was primarily due to advertising and marketing and investor relation campaigns beginning in late 2023 and continuing throughout 2024. During the nine months ended September 30, 2024 bonus expenses were recorded $400,000 under sales and marketing.
Previous report
Net Loss
Previous report
Net loss for the nine months ended September 30, 2024 and 2023 was $8,000,066 and $9,419,793, respectively.
Reworded paragraphs (15)
Previous wording
The following discussion and analysis is intended as a review of significant factors affecting our financial condition and results of operations for the periods indicated. The discussion should be read in conjunction with our unaudited condensed consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q and the audited financial statements and the other information included in our Annual Report on Form 10-K, filed with the U.S. Securities and Exchange Commission (the “Commission”, or the “SEC”) on April 1, 2024. In addition to historical information, the following Management’s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements that involve risks and uncertainties. Our actual results could differ significantly from those anticipated in these forward-looking statements as a result of certain factors discussed herein and any other periodic reports filed and to be filed with the SEC.
Current wording
The following discussion and analysis are intended as a review of significant factors affecting our financial condition and results of operations for the periods indicated. The discussion should be read in conjunction with our unaudited condensed consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q and the audited financial statements and the other information included in our Annual Report on Form 10-K, filed with the U.S. Securities and Exchange Commission (the “Commission”, or the “SEC”) on March 31, 2025. In addition to historical information, the following Management’s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements that involve risks and uncertainties. Our actual results could differ significantly from those anticipated in these forward-looking statements as a result of certain factors discussed herein and any other periodic reports filed and to be filed with the SEC.
Previous wording
Our company, LQR House Inc., a Nevada corporation (“LQR”, “LQR House”, or the “Company”), intends to become a prominent force in the wine and spirits e-commerce, sector epitomized by its flagship alcohol marketplace, CWSpirits.com (“CWS Platform”). This platform delivers a diverse range of spirits, wines, and champagnes from esteemed retail partners like Country Wine & Spirits. Beyond its role in the e-commerce sector, LQR is a marketing agency with a specialized focus on the alcohol industry. We also intend to integrate the supply, sales, and marketing facets of the alcoholic beverage space into one easy to use platform and become the one-stop-shop for everything related to alcohol. To date, our primary business includes the development of premium limited batch spirit brands and marketing internal and external brands through our ownership of the CWS Platform, a U.S.-based e-commerce portal. Additionally, we are in the process of establishing an exclusive wine club. We believe that the marketing and brand management services we provide to our wholly owned and third-party clients will increase brand recognition thereof, and drive sales thereof through our e-commerce platform.
Current wording
Our company, LQR House Inc. (the “Company”), intends to become the full-service digital marketing and brand development face of the alcoholic beverage space. We also intend to integrate the supply, sales, and marketing facets of the alcoholic beverage space into one easy to use platform and become the one-stop-shop for everything related to alcohol. To date, our primary business includes the development of premium limited batch spirit brands and marketing internal and external brands through our ownership of the CWS Platform. Additionally, we are in the process of establishing an exclusive wine club. We believe that the marketing and brand management services we provide to our wholly owned and third-party clients will increase brand recognition thereof, and drive sales thereof through our e-commerce platform partner.
Previous wording
In June 2024, we acquired a minority stake of common shares of DRNK Beverage Corp., a British Columbia corporation, operating in the non-alcoholic and ready-to-drink beverage markets.
Current wording
In June 2024, we acquired a minority stake of common shares of DRNK Beverage Corp., a British Columbia corporation (which became Chase Mocktails Ltd.), operating in the non-alcoholic and ready-to-drink beverage markets. As of December 31, 2024, the Company has recorded an impairment based on its evaluation of the investee. Refer to Note 5 to our unaudited condensed consolidated financial statements for further disclosure.
Previous wording
The CWS Platformis an American online retailer specializing in alcohol products, striving to become the most trusted and convenient destination for online alcohol purchases. Combining the personalized service of a neighborhood alcohol shop with the efficiency of e-commerce, we offer a wide selection of products, including our exclusive brand, SWOL Tequila, all at competitive prices with fast shipping and around-the-clock convenience. At the heart of our brand is a commitment to exceptional customer service, driving us to continuously innovate our operations for an enhanced shopping experience. From user-friendly website navigation and a top-rated mobile app to detailed order tracking and personalized product recommendations, we are revolutionizing the online alcohol shopping experience, ensuring customer satisfaction remains paramount in all our endeavors.
Current wording
The CWS Platformis an American online retailer specializing in selling alcohol products, striving to become the most trusted and convenient destination for online alcohol purchases. Combining the personalized service of a neighborhood alcohol shop with the efficiency of e-commerce, we offer a wide selection of products, including our exclusive brand, SWOL Tequila, all at competitive prices with fast shipping and around-the-clock convenience. At the heart of our brand is a commitment to exceptional customer service, driving us to continuously innovate our operations for an enhanced shopping experience. From user-friendly website navigation and a top-rated mobile app to detailed order tracking and personalized product recommendations, we are revolutionizing the online alcohol shopping experience, ensuring customer satisfaction remains paramount in all our endeavors.
Previous wording
For the three months ended September 30, 2024 and 2023, service revenues were $30,918 and $101,414, respectively. Service revenues are earned as we contract with third-party alcoholic beverage brands to utilize access to the CWS Platform, as well as vault memberships. Service revenues decreased by $70,496 as more focus was emphasized on the CWS Platform.
Current wording
For the three months ended March 31, 2025 and 2024, service revenues were $77,356 and $43,791, respectively. Service revenues are earned as we contract with third-party alcoholic beverage brands to utilize access to the CWS Platform, as well as vault memberships. Service revenues increased by $33,565 primarily driven by a higher volume of marketing services provided.
Previous wording
Gross profit (loss) was ($62,051) and $7,619 for the three months ended September 30, 2024 and 2023. The Company has incurred gross losses in 2024 as it transitions its strategies from marketing to the CWS Platform. Management is exploring various strategies, including customer acquisition and new partnerships, to increase volume in order to achieve better gross margins in 2024.
Current wording
Gross profit (loss) was $30,158 and ($79,497) for the three months ended March 31, 2025 and 2024. The Company has incurred gross losses in 2024 as it transitions its strategies from marketing to the CWS Platform. Management is exploring various strategies, including customer acquisition and new partnerships, to increase volume in order to achieve better gross margins in 2025.
Previous wording
Net loss for the three months ended September 30, 2024 and 2023 was $3,363,380 and $5,541,228, respectively.
Current wording
Net loss for the three months ended March 31, 2025 and 2024 was $2,389,650 and $2,427,392, respectively.
Previous wording
As of September 30, 2024 and December 31, 2023, we had cash and cash equivalents of $247,913 and $7,064,348 respectively. As of September 30, 2024, we also had $3,439,467 in marketable securities. To date, we have financed our operations primarily through issuances of common stock and sales of our products and services.
Current wording
As of March 31, 2025 and December 31, 2024, we had cash and cash equivalents of $7,889,597 and $5,386,789 respectively. To date, we have financed our operations primarily through issuances of common stock and sales of our products and services.
Previous wording
The accompanying unaudited condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has not generated profits since inception, has sustained net losses of $8,000,066 and $9,419,793 for the nine months ended September 30, 2024 and 2023, and has negative cash flows from operations of $3,565,293 for the nine months ended September 30, 2024. The Company requires additional capital to operate and expects losses to continue for the foreseeable future. These factors raise substantial doubts about the Company’s ability to continue as a going concern.
Current wording
The accompanying unaudited condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has not generated profits since inception, has sustained net losses of $2,389,650 and $2,427,392 for the three months ended March 31, 2025 and 2024, and has negative cash flows from operations of $6,619,374 for the three months ended March 31, 2025. The Company requires additional capital to operate and expects losses to continue for the foreseeable future. These factors raise substantial doubts about the Company’s ability to continue as a going concern.
Previous wording
Management plans to raise additional capital to fund operations through debt and/or equity financings. Our failure to raise additional capital could have a negative impact on not only our financial condition but also our ability to execute our business plan. No assurance can be given that the Company will be successful in these efforts. The unaudited condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. The Company may not be able to obtain financing on acceptable terms, or at all.
Current wording
The Company’s ability to continue as a going concern for the next twelve months is dependent upon its ability to generate sufficient cash flows from operations to meet its obligations, which it has not been able to accomplish to date, or to obtain additional capital to fund operations through debt and/or equity financings. Our failure to raise additional capital could have a negative impact on not only our financial condition but also our ability to execute our business plan. No assurance can be given that the Company will be successful in these efforts.
Previous wording
The following table presents selected captions from our condensed statement of cash flows for the nine months ended September 30, 2024 and 2023:
Current wording
The following table presents selected captions from our condensed statement of cash flows for the three months ended March 31, 2025 and 2024:
Previous wording
Net cash used in operating activities for the nine months ended September 30, 2024 was $3,565,293, primarily due to our net loss of $8,000,066 partially offset by non-cash charges of $2,081,286 and changes in our operating assets and liabilities of $2,353,487.
Current wording
Net cash used in operating activities for the three months ended March 31, 2025 was $6,619,373, primarily due to our net loss of $2,389,650 partially offset by non-cash charges of $868,189 and changes in our operating assets and liabilities of $5,097,912.
Previous wording
Net Cash Provided by (Used in) Investing Activities
Current wording
Net Cash Used in Investing Activities
Previous wording
Net cash provided by (used in) investing activities for the nine months ended September 30, 2024 and 2023 were ($2,688,227) and $137,426, respectively. In 2024, the Company purchased marketable securities of $7,727,850, and sold securities of $4,369,623. The Company also received $670,000 back from an investment it was no longer pursuing. In 2023, the Company had repayments from CWS.
Current wording
Net cash used in investing activities for the three months ended March 31, 2025 and 2024 were $0 and $3,360,986, respectively. In 2024, the Company invested $4,030,986 in mutual fund investments, and received $670,000 back from an investment it was no longer pursuing.
Previous wording
Net cash provided by (used in) financing activities for the nine months ended September 30, 2024 and 2023 was ($562,915) and $6,287,692 respectively. In 2024, the Company repurchased shares of common stock. In 2023, the Company received $5,449,156 in proceeds from share issuances.
Current wording
Net cash provided by (used in) financing activities for the three months ended March 31, 2025 and 2024 was $9,122,181 and ($547,515) respectively. In 2025, the Company received $4,051,415 from exercise of warrants and $5,070,767 from issuance of shares pursuant to ATM Agreement. In 2024, the Company paid $547,515 for repurchase of shares.
Rearranged previous paragraphs (4)
Previous report — wording carried elsewhere
The following table sets forth key components of our results of operations during the nine months ended September 30, 2024 and September 30, 2023.
Previous report — wording carried elsewhere
For the nine months ended September 30, 2024 and 2023, service revenues were $114,689 and $395,212 respectively. Service revenues are earned as we contract with third-party alcoholic beverage brands to utilize access to the CWS Platform, as well as vault memberships. Service revenues decreased by $280,523 as more focus was emphasized on the CWS Platform.
Previous report — wording carried elsewhere
Cost of Revenue and Gross Profit (Loss)
Previous report — wording carried elsewhere
Net cash used in operating activities for the nine months ended September 30, 2023 was $4,568,848, primarily due to our net loss of $9,419,793 partially offset by non-cash charges of $5,828,378 and changes in our operating assets and liabilities of $977,433.