Akerna, a Denver-based cannabis compliance software company, is implementing a financial restructuring plan that includes reducing its workforce by 59 employees, or a third, and cutting operating costs by $440,000 in its second quarter.
“We can see a path to positive cash flows and profitability, and the board and the management team are committed to getting there on an accelerated timetable,” Akerna CEO Jessica Billingsley said in a news release.
The company’s ability to continue as a going concern depends on the success of its financial restructuring plan and its ability to raise additional capital, according to filings with the U.S. Securities and Exchange Commission (SEC).
Actual job reduction figures weren’t in the company’s news release but were provided in a separate form filed with the SEC.
Executives are taking a 25% pay cut to support the cost-cutting initiatives, according to the news release.
The company’s holdings include MJ Freeway, a seed-to-sale software platform.
Akerna has lost money since its inception, relying on capital raises to maintain ongoing operations.
The company incurred an operating loss of $20.6 million for its first three months of 2022 and ended the quarter with a working capital deficit of $15.1 million, according to one filing.
Akerna also said last week that it has received notice from the Nasdaq stock market that it has fallen out of compliance with a requirement to maintain a bid price of $1 a share.
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The notice doesn’t have an immediate effect, but Akerna must regain compliance by Nov. 21 unless the Nasdaq grants an extension.
Akerna, which trades on the Nasdaq as KERN, closed at 40 cents a share on Tuesday.
Jeff Smith can be reached at firstname.lastname@example.org.