- Total Revenue, Less Transaction-Based Expenses of $19.1 million
in 3Q24, up 4% over the year-ago quarter
- Total Marketplace Revenues, Less Transaction-Based Expenses of
$8.6 million in 3Q24, up 21% over the year-ago quarter
- Trading Volume of $338.1 million in 3Q24, up 44% over the
year-ago quarter
- Forge announces Forge Price and the Private Magnificent 7
Forge Global Holdings, Inc. (“Forge,” or the “Company”) (NYSE:
FRGE), a leading private securities marketplace, today announced
its financial results for the quarter ended September 30, 2024.
“In Q3, we remained focused on technology and product
innovations that expand access and improve the experience for all
participants in the private market,” said Kelly Rodriques, CEO of
Forge. “Our continued investment in the Forge Next Generation
Platform allows us to better expose pricing information, improve
the client experience, and drive further efficiency into the
trading process. And our launch of Forge Price is a breakthrough in
pricing transparency, revolutionizing how investors access and
interpret private market valuations, benchmarking, and
indexing.”
Financial Highlights for the Third
Quarter 2024
Revenue: Total revenue, less transaction-based expenses
was $19.1 million, compared to $22.0 million last quarter, and
$18.4 million in the year-ago quarter.
Operating Loss: Total operating loss was $20.9 million,
compared to $17.7 million last quarter, and $21.5 million in the
year-ago quarter.
Net Loss: Net loss was $18.8 million, compared to $14.0
million last quarter, and $19.0 million in the year-ago
quarter.
Adjusted EBITDA Loss: Total adjusted EBITDA loss was
$11.4 million, compared to $7.9 million last quarter, and $10.4
million in the year-ago quarter.
Cash Flow from Operating Activities: Net cash used in
operating activities was $5.8 million, compared to $14.4 million
last quarter, and $3.5 million in the year-ago quarter.
Cash Flow from Investing Activities: Net cash used in
investing activities was $0.2 million, compared to cash provided by
investing activities of $6.3 million last quarter, and cash used in
investing activities of $0.5 million in the year-ago quarter.
Cash Flow from Financing Activities: Net cash used in
financing activities was $0.4 million, compared to $0.9 million
last quarter, and cash provided by financing activities of less
than $0.1 million in the year-ago quarter.
Ending Cash Balance: Cash and cash equivalents as of
September 30, 2024 was $114.5 million.
Share Count: Basic weighted-average number of shares used
to compute net loss per share attributable to common stockholders
for the quarter ended September 30, 2024, was 184 million shares
and fully diluted outstanding share count as of September 30, 2024
was 201 million shares.
We estimate for the quarter ended December 31, 2024 that Forge
will have 186 million weighted average basic shares outstanding,
which will be used to calculate earnings per share in a loss
position.
Fully diluted outstanding share count includes all common shares
outstanding plus shares that would be issued in respect to
outstanding restricted stock units, options and warrants, net of
shares to be withheld in respect to exercise price of the
respective instruments. Instruments that are out of the money are
excluded from the fully diluted outstanding share count.
KPIs for the Third Quarter
2024
- Trading Volume was $338.1 million, compared to $426.3 million
last quarter, and $234.1 million in the year-ago quarter.
- Net Take Rate was 2.6%, compared to 2.7% last quarter, and 3.0%
in the year-ago quarter.
- Total Marketplace revenues, less transaction-based expenses was
$8.6 million, compared to $11.4 million last quarter, and $7.1
million in the year-ago quarter.
- Total Custodial Administration Fee revenues was $10.5 million,
compared to $10.6 million last quarter, and $11.3 million in the
year-ago quarter.
- Total Custodial Accounts was 2.28 million, compared to 2.21
million last quarter, and 2.02 million in the year-ago
quarter.
- Total Assets Under Custody was $16.6 billion, compared to $16.6
billion last quarter, and $15.1 billion in the year-ago
quarter.
Additional Business Metrics for the
Third Quarter 2024
- Forge Trust Custodial Cash: Forge Trust Custodial Cash
was $470.0 million, compared to $495.0 million last quarter, and
$518.0 million in the year-ago quarter.
- Total Number of Companies with Indications of Interest
(IOIs): The total number of companies with IOIs was 516,
compared to 551 last quarter, and 502 in the year-ago quarter.
- Employee Headcount: Forge finished out the quarter with
a total employee headcount of 307.
Please refer to the section titled “Use of Non-GAAP Financial
Information” and the tables within this press release which contain
explanations and reconciliations of the Company’s non-GAAP
financial measures.
Business Highlights
- Forge Price: Forge announced in September the launch of
Forge Price, a derived, indicative price calculated daily for
approximately 250 pre-IPO venture-backed late-stage companies. The
innovative pricing model provides a derived price per share for
each company by synthesizing data from various sources, including
secondary market transactions, recent funding rounds, and
indications of interest on Forge.
- Forge Names the Private Magnificent 7: In September,
Forge announced the Private Market Magnificent 7, which represent a
group of private, venture-backed, late-stage companies that have
demonstrated resilience and propped up the performance of the
private market over the recent market cycle, much like their public
market counterparts.
Forge will host a webcast conference call today, November 6th,
2024, at 4:30 p.m. Eastern Time / 1:30 p.m Pacific Time to discuss
these financial results and business highlights. The listen-only
webcast is available at https://ir.forgeglobal.com. Investors and
participants can access the conference call over the phone by
dialing 1 (800) 715-9871 from the United States, or +1 (646)
307-1963 internationally. The conference ID is 6194475.
Following the conference call, an on-demand replay of the
webcast will be made available on the Investor Relations page of
the Company’s website at https://ir.forgeglobal.com.
Use of Non-GAAP Financial
Information
In addition to our financial results determined in accordance
with generally accepted accounting principles in the United States
of America ("GAAP"), we present Adjusted EBITDA, a non-GAAP
financial measure. We use Adjusted EBITDA to evaluate our ongoing
operations and for internal planning and forecasting purposes. We
believe that Adjusted EBITDA, when taken together with the
corresponding GAAP financial measure, provides meaningful
supplemental information regarding our performance by excluding
specific financial items that have less bearing on our core
operating performance. We consider Adjusted EBITDA to be an
important measure because it helps illustrate underlying trends in
our business and our historical operating performance on a more
consistent basis.
However, non-GAAP financial information is presented for
supplemental informational purposes only, has limitations as an
analytical tool and should not be considered in isolation or as a
substitute for financial information presented in accordance with
GAAP. In addition, other companies, including companies in our
industry, may calculate similarly titled non-GAAP financial
measures differently or may use other measures to evaluate their
performance, all of which could reduce the usefulness of Adjusted
EBITDA as a tool for comparison. A reconciliation is provided below
for Adjusted EBITDA to net loss, the most directly comparable
financial measure stated in accordance with GAAP. Investors are
encouraged to review Adjusted EBITDA and the reconciliation of
Adjusted EBITDA to net loss, and not to rely on any single
financial measure to evaluate our business. We define Adjusted
EBITDA as net loss attributable to Forge Global Holdings, Inc.,
adjusted to exclude: (i) net loss attributable to noncontrolling
interest, (ii) provision for income taxes, (iii) interest (income)
expense, net, (iv) depreciation and amortization, (v) share-based
compensation expense, (vi) change in fair value of warrant
liabilities, and (vii) other significant gains, losses, and
expenses such as impairments or acquisition-related transaction
costs that we believe are not indicative of our ongoing
results.
Forward-Looking
Statement
This press release contains “forward-looking statements,” which
generally are accompanied by words such as “believe,” “may,”
“could,” “will,” “estimate,” “continue,” “anticipate,” “intend,”
“target,” “goal,” “expect,” “should,” “would,” “plan,” “predict,”
“project,” “forecast,” “potential,” “seem,” “seek,” “future,”
“outlook,” and similar expressions that predict, indicate or relate
to future events or trends or Forge’s future financial or operating
performance, or that are not statements of historical matters.
These forward-looking statements include, but are not limited to,
statements regarding Forge’s beliefs regarding its financial
position and operating performance, as well as future opportunities
for Forge to expand its business. Forward-looking statements are
predictions, projections and other statements about future events
that are based on current expectations and assumptions and, as a
result, while considered reasonable by Forge and its management,
are subject to risks and uncertainties that may cause actual
results to differ materially from current expectations. You should
carefully consider the risks and uncertainties described in Forge’s
documents filed, or to be filed, with the SEC, including in its
Quarterly Report on Form 10-Q that will be filed on or around the
date of this press release. There may be additional risks that
Forge presently does not know of or that it currently believes are
immaterial that could also cause actual results to differ
materially from those contained in the forward-looking statements.
In addition, forward-looking statements reflect Forge’s
expectations, plans or forecasts of future events and views as of
the date of this press release. Forge anticipates that subsequent
events and developments will cause its assessments to change.
However, while Forge may elect to update these forward-looking
statements at some point in the future, Forge specifically
disclaims any obligation to do so. These forward-looking statements
should not be relied upon as representing Forge’s assessments as of
any date subsequent to the date of this press release. Accordingly,
undue reliance should not be placed upon the forward-looking
statements.
About Forge
Forge is a leading provider of marketplace infrastructure, data
services and technology solutions for private market participants.
Forge Securities LLC is a registered broker-dealer and a Member of
FINRA that operates an alternative trading system.
FORGE GLOBAL HOLDINGS,
INC.
Consolidated Balance
Sheets
(In thousands of U.S. dollars,
except share and per share data)
September 30, 2024
(Unaudited)
December 31,
2023
Assets
Current assets:
Cash and cash equivalents
$
114,454
$
144,722
Restricted cash
1,103
1,062
Accounts receivable, net
4,955
4,067
Prepaid expenses and other current
assets
8,891
13,253
Total current assets
129,403
163,104
Internal-use software, property and
equipment, net
3,500
5,192
Goodwill and other intangible assets,
net
126,983
129,919
Operating lease right-of-use assets
6,654
4,308
Payment-dependent notes receivable,
noncurrent
7,436
5,593
Other assets, noncurrent
2,597
2,615
Total assets
$
276,573
$
310,731
Liabilities and stockholders’
equity
Current liabilities:
Accounts payable
$
1,640
$
1,831
Accrued compensation and benefits
11,306
11,004
Accrued expenses and other current
liabilities
7,694
8,861
Operating lease liabilities, current
3,453
2,516
Total current liabilities
24,093
24,212
Operating lease liabilities,
noncurrent
4,492
2,707
Payment-dependent notes payable,
noncurrent
7,436
5,593
Warrant liabilities
1,958
9,616
Other liabilities, noncurrent
313
185
Total liabilities
38,292
42,313
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.0001 par value;
184,320,636 and 176,899,814 shares issued and outstanding as of
September 30, 2024 and December 31, 2023, respectively
19
18
Treasury stock, at cost; 157,193 shares as
of September 30, 2024 and December 31, 2023, respectively
(625
)
(625
)
Additional paid-in capital
565,529
543,846
Accumulated other comprehensive income
933
911
Accumulated deficit
(331,328
)
(280,638
)
Total Forge Global Holdings, Inc.
stockholders’ equity
234,528
263,512
Noncontrolling interest
3,753
4,906
Total stockholders’ equity
238,281
268,418
Total liabilities and stockholders’
equity
$
276,573
$
310,731
FORGE GLOBAL HOLDINGS,
INC.
Unaudited Condensed
Consolidated Statements of Operations
(In thousands of U.S. dollars,
except share and per share data)
Three Months Ended
Nine Months Ended
September 30, 2024
June 30, 2024
September 30, 2023
September 30, 2024
September 30, 2023
Revenues:
Marketplace revenues
$
8,713
$
11,679
$
7,283
$
28,912
$
17,638
Custodial administration fees
10,503
10,603
11,280
31,828
33,124
Total revenues
19,216
22,282
18,563
60,740
50,762
Transaction-based expenses:
Transaction-based expenses
(73
)
(256
)
(148
)
(358
)
(250
)
Total revenues, less transaction-based
expenses
19,143
22,026
18,415
60,382
50,512
Operating expenses:
Compensation and benefits
28,750
28,784
27,650
87,377
78,566
Technology and communications
3,185
2,649
3,763
8,894
10,628
Professional services
2,435
1,605
2,883
6,257
8,884
Advertising and market development
1,015
1,243
910
3,348
2,463
Rent and occupancy
1,036
1,107
1,142
3,278
3,616
General and administrative
1,877
2,508
1,870
9,447
8,143
Depreciation and amortization
1,748
1,781
1,710
5,345
5,246
Total operating expenses
40,046
39,677
39,928
123,946
117,546
Operating loss
(20,903
)
(17,651
)
(21,513
)
(63,564
)
(67,034
)
Interest and other income
(expense):
Interest income
1,307
1,495
1,725
4,511
4,553
Change in fair value of warrant
liabilities
931
2,280
907
7,659
(2,715
)
Other income, net
119
94
215
288
647
Total interest and other income
2,357
3,869
2,847
12,458
2,485
Loss before provision for income
taxes
(18,546
)
(13,782
)
(18,666
)
(51,106
)
(64,549
)
Provision for income taxes
298
258
291
772
769
Net loss
(18,844
)
(14,040
)
(18,957
)
(51,878
)
(65,318
)
Net loss attributable to noncontrolling
interest
(502
)
(316
)
(609
)
(1,188
)
(893
)
Net loss attributable to Forge Global
Holdings, Inc.
$
(18,342
)
$
(13,724
)
$
(18,348
)
$
(50,690
)
$
(64,425
)
Net loss per share attributable to Forge
Global Holdings, Inc. common stockholders:
Basic
$
(0.10
)
$
(0.08
)
$
(0.11
)
$
(0.28
)
$
(0.37
)
Diluted
$
(0.10
)
$
(0.08
)
$
(0.11
)
$
(0.28
)
$
(0.37
)
Weighted-average shares used in computing
net loss per share attributable to Forge Global Holdings, Inc.
common stockholders:
Basic
184,158,571
182,681,065
173,957,880
182,261,198
173,045,721
Diluted
184,158,571
182,681,065
173,957,880
182,261,198
173,045,721
FORGE GLOBAL HOLDINGS,
INC.
Unaudited Condensed
Consolidated Statements of Cash Flows
(In thousands of U.S.
dollars)
Three Months Ended
Nine Months Ended
September 30, 2024
June 30, 2024
September 30, 2023
September 30, 2024
September 30, 2023
Cash flows from operating
activities:
Net loss
$
(18,844
)
$
(14,040
)
$
(18,957
)
$
(51,878
)
$
(65,318
)
Adjustments to reconcile net loss to net
cash used in operations:
Share-based compensation
7,622
7,859
9,233
24,948
25,443
Depreciation and amortization
1,748
1,781
1,711
5,345
5,247
Amortization of right-of-use assets
670
662
748
1,975
2,327
Loss on impairment of long lived
assets
—
—
—
—
536
Impairment of right-of-use assets
—
—
—
186
—
Allowance for doubtful accounts
34
107
358
250
529
Change in fair value of warrant
liabilities
(932
)
(2,280
)
(907
)
(7,659
)
2,715
Changes in operating assets and
liabilities:
Accounts receivable
(466
)
923
456
(1,139
)
(857
)
Prepaid expenses and other assets
2,049
(5,353
)
1,371
(2,179
)
1,590
Accounts payable
(120
)
(1,004
)
(89
)
(58
)
(1,318
)
Accrued expenses and other liabilities
922
(4,636
)
723
(931
)
2,011
Accrued compensation and benefits
2,228
2,041
3,042
302
(4,472
)
Operating lease liabilities
(739
)
(491
)
(1,236
)
(1,785
)
(3,317
)
Other
—
—
—
(10
)
—
Net cash used in operating
activities
(5,828
)
(14,431
)
(3,547
)
(32,633
)
(34,884
)
Cash flows from investing
activities:
Purchases of term deposits
—
—
(515
)
—
(3,180
)
Receipts of term deposit maturities
—
6,559
—
6,559
—
Capitalized internal-use software
development costs
(48
)
—
—
(48
)
—
Purchases of property and equipment
(125
)
(267
)
(14
)
(792
)
(113
)
Net cash (used in) provided by
investing activities
(173
)
6,292
(529
)
5,719
(3,293
)
Cash flows from financing
activities:
Proceeds from exercise of options
12
235
23
473
353
Taxes withheld and paid related to net
share settlement of equity awards
(406
)
(1,135
)
—
(3,843
)
(557
)
Net cash (used in) provided by
financing activities
(394
)
(900
)
23
(3,370
)
(204
)
Effect of changes in currency exchange
rates on cash and cash equivalents
388
(78
)
(333
)
57
(158
)
Net decrease in cash and cash
equivalents
(6,007
)
(9,117
)
(4,386
)
(30,227
)
(38,539
)
Cash, cash equivalents and restricted
cash, beginning of the period
121,564
130,681
160,812
145,784
194,965
Cash, cash equivalents and restricted
cash, end of the period
$
115,557
$
121,564
$
156,426
$
115,557
$
156,426
Reconciliation of cash, cash
equivalents and restricted cash to the amounts reported within the
consolidated balance sheets
Cash and cash equivalents
$
114,454
$
120,475
$
155,127
$
114,454
$
155,127
Restricted cash
1,103
1,089
1,299
1,103
1,299
Total cash, cash equivalents and
restricted cash, end of the period
$
115,557
$
121,564
$
156,426
$
115,557
$
156,426
FORGE GLOBAL HOLDINGS,
INC.
Reconciliation of GAAP to
Non-GAAP Results
(In thousands of U.S.
dollars)
Three Months Ended
Nine Months Ended
September 30, 2024
June 30, 2024
September 30, 2023
September 30, 2024
September 30, 2023
Net loss attributable to Forge Global
Holdings, Inc.
$
(18,342
)
$
(13,724
)
$
(18,348
)
$
(50,690
)
$
(64,425
)
Add:
Net loss attributable to noncontrolling
interest
(502
)
(316
)
(609
)
(1,188
)
(893
)
Provision for income taxes
298
258
291
772
769
Interest (income) expense, net
(1,307
)
(1,495
)
(1,725
)
(4,511
)
(4,553
)
Depreciation and amortization
1,748
1,781
1,710
5,345
5,246
Share-based compensation expense
7,622
7,859
9,233
24,948
25,443
Change in fair value of warrant
liabilities
(931
)
(2,280
)
(907
)
(7,659
)
2,715
Impairment of right-of-use assets
—
—
—
186
—
Loss on impairment of long lived
assets
—
—
—
—
536
Adjusted EBITDA
$
(11,414
)
$
(7,917
)
$
(10,355
)
$
(32,797
)
$
(35,162
)
FORGE GLOBAL HOLDINGS, INC.
SUPPLEMENTAL FINANCIAL INFORMATION KEY OPERATING
METRICS (In thousands of U.S. dollars)
Key Business Metrics
We monitor the following key business metrics to help us
evaluate our business, identify trends affecting our business,
formulate business plans and make strategic decisions. The tables
below reflect period-over-period changes in our key business
metrics, along with the percentage change between such periods. We
believe the following business metrics are useful in evaluating our
business:
Three Months Ended
Nine Months Ended
Dollars in thousands
September 30, 2024
June 30, 2024
September 30, 2023
September 30, 2024
September 30, 2023
TRADING
SOLUTIONS
Trades
680
831
567
2,116
1,321
Volume
$
338,075
$
426,318
$
234,141
$
1,026,931
$
515,486
Net Take Rate
2.6
%
2.7
%
3.0
%
2.8
%
3.4
%
Marketplace revenues, less
transaction-based expenses
$
8,640
$
11,423
$
7,135
$
28,554
$
17,388
- Trades are defined as the total number of orders executed by us
and entities we have acquired on behalf of private investors and
stockholders. Increasing the number of orders is critical to
increasing our revenue and, in turn, to achieving
profitability.
- Volume is defined as the total sales value for all securities
traded through our Forge Markets platform which is the aggregate
value of the issuer company’s equity attributed to both the buyer
and seller in a trade and as such a $100 trade of equity between
buyer and seller would be captured as $200 volume for us. Although
we typically capture a commission on each side of a trade, we may
not in certain cases due to factors such as the use of a
third-party broker by one of the parties or supply factors that
would not allow us to attract sellers of shares of certain issuers.
Volume is influenced by, among other things, the pricing and
quality of our services as well as market conditions that affect
private company valuations, such as increases in valuations of
comparable companies at IPO.
- Net Take Rates are defined as our marketplace revenues, less
transaction-based expenses, divided by Volume. These represent the
percentage of fees earned by our marketplace on any transactions
executed from the commission we charged on such transactions (less
transaction-based expenses), which is a determining factor in our
revenue. The Net Take Rate can vary based upon the service or
product offering and is also affected by the average order size and
transaction frequency.
As of
Dollars in thousands
September 30, 2024
June 30, 2024
September 30, 2023
CUSTODY
SOLUTIONS
Total Custodial Accounts
2,281,976
2,211,108
2,023,756
Assets Under Custody
$
16,620,450
$
16,600,408
$
15,148,480
- Total Custodial Accounts are defined as our customers’
custodial accounts that are established on our platform and
billable. These relate to our Custodial Administration fees revenue
stream and are an important measure of our business as the number
of Total Custodial Accounts is an indicator of our future revenues
from certain account maintenance, transaction and cash
administration fees.
- Assets Under Custody is the reported value of all client
holdings held under our agreements, including cash submitted to us
by the responsible party. These assets can be held at various
financial institutions, issuers and in our vault. As the custodian
of the accounts, we collect all interest and dividends, handle all
fees and transactions, and any other considerations for the assets
concerned. Our fees are earned from the overall maintenance
activities of all assets and are not charged on the basis of the
dollar value of Assets Under Custody, but we believe that Assets
Under Custody is a useful metric for assessing the relative size
and scope of our business.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241106401663/en/
Investor Relations Contact: Dominic Paschel
ir@forgeglobal.com
Media Contact: Lindsay Riddell press@forgeglobal.com
Forge Global (NYSE:FRGE)
Historical Stock Chart
From Oct 2024 to Nov 2024
Forge Global (NYSE:FRGE)
Historical Stock Chart
From Nov 2023 to Nov 2024
