Cover	May 10, 2023
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	May 10, 2023
Entity File Number	001-12471
Entity Registrant Name	THE ARENA GROUP HOLDINGS, INC.
Entity Central Index Key	0000894871
Entity Tax Identification Number	68-0232575
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	200 VESEY STREET
Entity Address, Address Line Two	24TH FLOOR
Entity Address, City or Town	NEW YORK
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	10281
City Area Code	212
Local Phone Number	321-5002
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, par value $0.01 per share
Trading Symbol	AREN
Security Exchange Name	NYSEAMER
Entity Emerging Growth Company	false

Cover

May 10, 2023

Cover [Abstract]

Document Type

8-K

Amendment Flag

false

Document Period End Date

May 10, 2023

Entity File Number

001-12471

Entity Registrant Name

THE ARENA GROUP HOLDINGS, INC.

Entity Central Index Key

0000894871

Entity Tax Identification Number

68-0232575

Entity Incorporation, State or Country Code

Entity Address, Address Line One

200 VESEY STREET

Entity Address, Address Line Two

24TH FLOOR

Entity Address, City or Town

NEW YORK

Entity Address, State or Province

Entity Address, Postal Zip Code

10281

City Area Code

212

Local Phone Number

321-5002

Written Communications

false

Soliciting Material

false

Pre-commencement Tender Offer

false

Pre-commencement Issuer Tender Offer

false

Title of 12(b) Security

Common Stock, par value $0.01 per share

Trading Symbol

AREN

Security Exchange Name

NYSEAMER

Entity Emerging Growth Company

false

200 VESEY STREET, 24TH FLOOR
NEW YORK, new york		10281
(Address of principal executive offices)		(Zip code)

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.01 per share		AREN		NYSE American

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Dated: May 10, 2023	THE ARENA GROUP HOLDINGS, INC.

	By:	/s/ Douglas B. Smith
	Name:	Douglas B. Smith
	Title:	Chief Financial Officer

	●	Revenue was $51.4 million versus $48.2 million in the prior year period.
	●	Digital advertising revenue increased by 9% to $23.5 million from $21.6 million in the prior year period.
	●	Operating expenses increased by only $0.7 million or 2% to $35.9 million from $35.2 million in the prior year period, despite adding the operations of Men’s Journal, Men’s Fitness, Surfer, Powder, Bike Magazine and Fexy Studios to the Company.
	●	Net loss increased by $1.0 million to $19.4 million from $18.4 million in the prior year period.
	●	Q1 2023 included approximately $15.3 million in non-cash charges, including stock-based compensation, amortization of platform development and intangible assets, and other non-cash charges.
	●	Adjusted EBITDA* was a loss of $4.5 million versus an Adjusted EBITDA loss of $1.1 million in the prior year period. This is partially due to the aforementioned acquisitions the Company made in December 2022 and January 2023 of Men’s Journal and Fexy Studios, respectively, both of which had little revenue contribution but all their expenses included in Q1 2023.
	●	The Arena Group dramatically reduced cash used from operations to $1.7 million versus $13.3 million of cash used in operations in the prior year period, an improvement of $11.6 million.
	●	In January 2023, The Arena Group acquired Fexy Studios, an award-winning creative agency that produces television shows, streaming and digital video programming, and branded content across a variety of mediums including desktop and mobile web, OTT, broadcast television, YouTube, Twitch, Instagram, Facebook, webinars, and more.

	●	The Lifestyle vertical, anchored by Parade, has continued to expand its audience since its acquisition by the Company in April 2022. According to Google Analytics, Parade.com’s monthly average pageviews increased by 29% in Q1 2023 compared to the second quarter of 2022 when it was acquired, reaching 162 million quarterly pageviews in Q1 2023, according to Google Analytics. Parade’s social media presence has also expanded dramatically, with an 89% growth in quarterly engagement across all social platforms year-over-year, according to ListenFirst.
	●	Sports Illustrated Media Group remained the #4 ranked sports media property according to Comscore in March 2023. Traffic to Sports Illustrated remained flat year-over-year, despite the fact that Q1 2023 did not benefit from a Winter Olympics and saw a March Madness tournament without many marquee teams. Still, the Company generated more than 840 million Sports Illustrated Media Group pageviews during the quarter, according to Google Analytics.
	●	The Finance vertical, anchored by TheStreet, significantly expanded its distribution partnerships, with a 257% growth in quarterly Apple News pageviews year-over-year. TheStreet, which began producing video content at its news desk on the floor of the New York Stock Exchange late last year, has driven a 61% growth in quarterly social video views year-over-year. Monthly average pageviews decreased by 6% in Q1 2023 compared to Q1 2022, reaching an average of nearly 24 million pageviews online each month, according to Google Analytics.
	●	In the HubPages business, the Company’s content playbook has now expanded across 11 sites, with plans to apply our playbook throughout 2023. While breaking and trending news traffic was impacted by audience volatility this quarter, the Company’s total HubPages monthly average pageviews in Q1 2023 was nearly 53 million, up 3% from Q1 2022, according to Google Analytics.

	March 31, 2023 (unaudited)			December 31, 2022
	($ in thousands, except share data)
Assets
Current assets:
Cash and cash equivalents	$	15,961		$	13,871
Restricted cash		502			502
Accounts receivable, net		23,561			33,950
Subscription acquisition costs, current portion		31,908			25,931
Prepayments and other current assets		12,037			4,441
Total current assets		83,969			78,695
Property and equipment, net		565			735
Operating lease right-of-use assets		327			372
Platform development, net		10,189			10,330
Subscription acquisition costs, net of current portion		12,460			14,133
Acquired and other intangible assets, net		54,844			58,970
Other long-term assets		1,025			1,140
Goodwill		41,329			39,344
Total assets	$	204,708		$	203,719
Liabilities, mezzanine equity and stockholders’ deficiency
Current liabilities:
Accounts payable	$	15,458		$	12,863
Accrued expenses and other		21,467			23,102
Line of credit		9,559			14,092
Unearned revenue		60,584			58,703
Subscription refund liability		940			845
Operating lease liability		442			427
Contingent consideration		1,060			-
Liquidated damages payable		5,970			5,843
Bridge notes		35,433			34,805
Term debt		65,932			65,684
Total current liabilities		216,845			216,364
Unearned revenue, net of current portion		21,234			19,701
Operating lease liability, net of current portion		242			358
Liquidated damages payable, net of current portion		124			494
Other long-term liabilities		5,314			5,307
Deferred tax liabilities		472			465
Total liabilities		244,231			242,689
Commitments and contingencies
Mezzanine equity:
Series G redeemable and convertible preferred stock, $0.01 par value, $1,000 per share liquidation value and 1,800 shares designated; aggregate liquidation value: $168; Series G shares issued and outstanding: 168; common shares issuable upon conversion: 8,582 at March 31, 2023 and December 31, 2022		168			168
Series H convertible preferred stock, $0.01 par value, $1,000 per share liquidation value and 23,000 shares designated; aggregate liquidation value: $14,356; Series H shares issued and outstanding: 14,356; common shares issuable upon conversion: 1,981,128 at March 31, 2023 and December 31, 2022		13,008			13,008
Total mezzanine equity		13,176			13,176
Stockholders’ deficiency:
Common stock, $0.01 par value, authorized 1,000,000,000 shares; issued and outstanding: 21,773,078 and 18,303,193 shares at March 31, 2023 and December 31, 2022, respectively		217			182
Common stock to be issued		-			-
Additional paid-in capital		289,532			270,743
Accumulated deficit		(342,448	)		(323,071	)
Total stockholders’ deficiency		(52,699	)		(52,146	)
Total liabilities, mezzanine equity and stockholders’ deficiency	$	204,708		$	203,719

	Three Months Ended March 31,
	2023			2022
	($ in thousands, except per share data)
Revenue	$	51,380		$	48,243
Cost of revenue (includes amortization of platform development and developed technology for 2023 and 2022 of $2,369 and $2,311, respectively)		30,035			28,497
Gross profit		21,345			19,746
Operating expenses
Selling and marketing		17,969			17,216
General and administrative		13,053			13,514
Depreciation and amortization		4,766			4,202
Loss on impairment of assets		119			257
Total operating expenses		35,907			35,189
Loss from operations		(14,562	)		(15,443	)
Other expenses
Change in fair value of contingent consideration		(499	)		-
Interest expense		(4,182	)		(2,820	)
Liquidated damages		(127	)		(172	)
Total other expenses		(4,808	)		(2,992	)
Loss before income taxes		(19,370	)		(18,435	)
Income tax provision		(7	)		(14	)
Net loss	$	(19,377	)	$	(18,449	)
Basic and diluted net loss per common share	$	(1.04	)	$	(1.20	)
Weighted average number of common shares outstanding – basic and diluted		18,718,555			15,381,306

	(1)	Interest expense is related to our capital structure and varies over time due to a variety of financing transactions. Interest expense includes $930 and $660 for amortization of debt discounts for the three months ended March 31, 2023 and 2022, respectively, as presented in our condensed consolidated statements of cash flows, which is a noncash item. Investors should note that interest expense will recur in future periods.
	(2)	Depreciation and amortization is related to our developed technology and Platform included within cost of revenues of $2,369 and $2,311, for the three months ended March 31, 2023 and 2022, respectively, and depreciation and amortization included within operating expenses of $4,766 and $4,202 for the three months ended March 31, 2023 and 2022, respectively. We believe (i) the amount of depreciation and amortization expense in any specific period may not directly correlate to the underlying performance of our business operations and (ii) such expenses can vary significantly between periods as a result of new acquisitions and full amortization of previously acquired tangible and intangible assets. Investors should note that the use of tangible and intangible assets contributed to revenue in the periods presented and will contribute to future revenue generation and should also note that such expense will recur in future periods.
	(3)	Stock-based compensation represents noncash costs arise from the grant of stock-based awards to employees, consultants and directors. We believe that excluding the effect of stock-based compensation from Adjusted EBITDA assists management and investors in making period-to-period comparisons in our operating performance because (i) the amount of such expenses in any specific period may not directly correlate to the underlying performance of our business operations, and (ii) such expenses can vary significantly between periods as a result of the timing of grants of new stock-based awards, including grants in connection with acquisitions. Additionally, we believe that excluding stock-based compensation from Adjusted EBITDA assists management and investors in making meaningful comparisons between our operating performance and the operating performance of other companies that may use different forms of employee compensation or different valuation methodologies for their stock-based compensation. Investors should note that stock-based compensation is a key incentive offered to employees whose efforts contributed to the operating results in the periods presented and are expected to contribute to operating results in future periods. Investors should also note that such expenses will recur in the future.
	(4)	Change in fair value of contingent consideration represents the change in the put option of our common stock in connection with the Fexy Studios acquisition.
	(5)	Liquidated damages (or interest expense related to accrued liquidated damages) represents amounts we owe to certain of our investors in private placements offerings conducted in fiscal years 2018 through 2020, pursuant to which we agreed to certain covenants in the respective securities purchase agreements and registration rights agreements, including the filing of resale registration statements and becoming current in our reporting obligations, which we were not able to timely meet.
	(6)	Loss on impairment of assets represents certain assets that are no longer useful.
	(7)	Employee retention credit represents payroll related tax credits under the Cares Act.
	(8)	Employee restructuring payments represents severance payments to employees under employer restructuring arrangements and payments to our former Chief Executive Officer for the three months ended March 31, 2023 and 2022, respectively.