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 September 30, 2004
Commission File Number 000-25779
TheStreet.com, Inc.
(Exact name of Registrant as specified in its charter)
| Delaware (State or other jurisdiction of incorporation or organization) |
06-1515824 (I.R.S. Employer Identification Number) |
14 Wall Street
New York, New York 10005
(Address of principal executive offices, including zip code)
(212) 321-5000
(Registrant’s telephone number, including area code)
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 x No o
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes x No o
Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date.
| (Title of Class) Common Stock, par value $0.01 per share |
(Number of Shares Outstanding as of November 5, 2004) 24,656,399 |
TheStreet.com, Inc.
Form 10-Q
For the Three and Nine Months Ended September 30, 2004
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Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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ii
Part
I – FINANCIAL INFORMATION Interim Consolidated
Financial Statements.
THESTREET.COM,
INC. September 30, 2004 December 31, 2003 (unaudited) (Note 1) ASSETS Current
Assets: Cash
and cash equivalents $ 26,371,300 $ 22,247,400 Restricted
cash 300,000 300,000 Short-term
investments 2,008,128 4,010,904 Accounts
receivable, net of allowance for doubtful accounts of $137,065 as of September
30, 2004 and $129,096 as of December 31, 2003 1,589,263 1,637,822 Other
receivables 91,825 202,336 Receivables
from related parties — 214,788 Prepaid
expenses and other current assets 1,342,630 1,303,891 Total
current assets 31,703,146 29,917,141 Property
and equipment, net of accumulated depreciation and amortization of $12,409,188
as of September 30, 2004 and $11,744,173 as of December 31, 2003 2,589,381 2,553,063 Other
assets 87,428 343,450 Goodwill 1,990,312 1,990,312 Other
intangibles, net 493,333 493,333 Restricted
cash 2,305,000 1,900,000 Total
assets $ 39,168,600 $ 37,197,299 LIABILITIES
AND STOCKHOLDERS’ EQUITY Current
Liabilities: Accounts
payable $ 861,934 $ 787,409 Accrued
expenses 5,282,232 3,144,949 Deferred
revenue 8,018,482 6,839,171 Current
portion of note payable 94,578 89,895 Other
current liabilities 174,701 71,859 Total
current liabilities 14,431,927 10,933,283 Note
payable 149,739 221,269 Other
liabilities 40,943 55,399 Total
liabilities 14,622,609 11,209,951 Stockholders’
Equity Preferred
stock; $0.01 par value; 10,000,000 shares authorized; none issued and
outstanding — — Common
stock; $0.01 par value; 100,000,000 shares authorized; 30,100,549 shares
issued and 24,647,133 shares outstanding at September 30, 2004, and 29,463,299
shares issued and 24,041,199 shares outstanding at December 31, 2003 301,005 294,633 Additional
paid-in capital 186,079,495 184,502,124 Treasury
stock at cost; 5,453,416 shares at September 30, 2004 and 5,422,100 shares
at December 31, 2003 (7,321,122 ) (7,215,410 ) Accumulated
deficit (154,513,387 ) (151,593,999 ) Total
stockholders’ equity 24,545,991 25,987,348 Total
liabilities and stockholders’ equity $ 39,168,600 $ 37,197,299 The
accompanying notes to the consolidated financial statements are an integral
part of these statements 1 THESTREET.COM,
INC. For the Three Months For the Nine Months Ended 2004 2003 2004 2003 (unaudited) (unaudited) Net
revenue: Subscription $ 5,742,541 $ 4,826,585 $ 16,839,215 $ 13,449,194 Advertising 1,676,007 1,222,386 5,019,053 3,899,205 Commission 969,443 313,155 2,955,034 480,231 Other 280,753 303,884 918,340 887,789 Total
net revenue 8,668,744 6,666,010 25,731,642 18,716,419 Operating
expense: Cost
of services 3,914,587 3,483,057 11,997,417 10,476,307 Sales
and marketing 2,920,577 1,855,782 9,116,281 5,208,586 General
and administrative 2,573,229 1,763,126 6,790,781 5,378,722 Depreciation
and amortization 189,215 465,596 597,749 1,838,308 One-time
lease termination costs 392,851 — 392,851 — Noncash
compensation — 32,986 — 304,391 Total
operating expense 9,990,459 7,600,547 28,895,079 23,206,314 Operating
loss (1,321,715 ) (934,537 ) (3,163,437 ) (4,489,895 ) Net
interest income 100,564 69,338 244,049 296,185 Net
loss $ (1,221,151 ) $ (865,199 ) $ (2,919,388 ) $ (4,193,710 ) Net
loss per share - basic and diluted: $ (0.05 ) $ (0.04 ) $ (0.12 ) $ (0.18 ) Weighted
average basic and diluted shares outstanding 24,632,812 23,947,440 24,481,306 23,818,398 The
accompanying notes to the consolidated financial statements are an integral
part of these statements 2 THESTREET.COM,
INC.
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED STATEMENTS OF OPERATIONS
Ended September 30,
September 30,
CONSOLIDATED STATEMENTS OF CASH FLOWS