AUSTIN, TX - Interactive Strength Inc. (NASDAQ: TRNR), a company specializing in fitness equipment and digital services, has declared a reverse stock split of its common stock at a 1-for-40 ratio, effective June 14, 2024. The move aims to comply with the Nasdaq Capital Market's minimum bid price requirement.
The company's board of directors approved the final ratio on May 30, 2024, following stockholder approval during the Annual Meeting on May 31, 2024. The reverse stock split will reduce the number of Interactive Strength's outstanding shares from about 26.6 million to approximately 664,526. This adjustment will extend to the shares underlying the company's outstanding equity awards, warrants, and the shares issuable under equity incentive plans.
Stockholders do not need to take action as the transition for those holding shares electronically in book-entry form or through brokerage accounts will be automatic. Shareholders with physical stock certificates will have their shares automatically adjusted to reflect the reverse stock split.
No fractional shares will be issued; instead, stockholders entitled to a fraction of a share will receive one additional share. The company's common stock will continue trading under the ticker "TRNR" with a new CUSIP number post-split.
Interactive Strength produces specialty fitness equipment under the CLMBR and FORME brands, with offerings that include vertical climbing machines and smart gyms integrated with virtual personal training.
This news article is based on a press release statement from Interactive Strength Inc.
In other recent news, Interactive Strength Inc. has been involved in significant financial developments. The company raised approximately $1 million through a registered direct offering and concurrent private placement, selling over 5 million shares of its common stock alongside unregistered warrants. H.C. Wainwright & Co. served as the exclusive placement agent for this offering.
In a separate development, Interactive Strength converted $3 million of its $8 million senior loan into equity, effectively reducing its debt liabilities. Additionally, the maturity date for the remaining balance has been extended to December 2024. These recent developments indicate the company's strategic financial maneuvers aimed at managing its debts while expanding its product offerings and market presence.
The CEO of Interactive Strength, Trent Ward, expressed the company's progress towards financial stability and anticipates approaching profitability by the fourth quarter of this year. These updates come in the wake of the company's acquisition of the CLMBR business earlier this year.
InvestingPro Insights
As Interactive Strength Inc. (NASDAQ: TRNR) undertakes a reverse stock split to meet Nasdaq's minimum bid price requirement, a closer look at the company's financial health is warranted. According to InvestingPro data, the company's market capitalization stands at a modest 3.53 million USD, reflecting the small size of this niche fitness equipment and digital services provider.
InvestingPro Tips highlight that analysts expect sales growth this year, which is supported by the company's impressive revenue growth of nearly 80% over the last twelve months as of Q1 2024. However, it's worth noting that despite these gains, the company has been grappling with weak gross profit margins, currently at -434.67%, and has a substantial negative operating income margin of -3656.68%. These figures underscore the challenges Interactive Strength faces in translating revenue growth into profitability.
The company's stock has experienced high volatility and has significantly underperformed in the market, with a precipitous 97.35% decline in price total return over the past year. Additionally, with short-term obligations exceeding liquid assets, the company's financial stability could be a concern for investors. To gain deeper insights and access further exclusive analysis, investors can explore additional InvestingPro Tips for Interactive Strength Inc. at https://www.investing.com/pro/TRNR. There are 15 additional InvestingPro Tips available, which can be accessed with a special offer using the coupon code PRONEWS24 for an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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