The direct-to-consumer firm Digital Brands has disclosed in its 10-K that it may file for bankruptcy protection.
It also stated that it may seek other options if the firm cannot come up with enough funds to run the business.
Notably, its latest S-1 and 10-K included a ‘going concern’ warning that it may struggle for survival without sufficient funds.
The Group, which went public last year, saw its yearly revenue surge by 45 per cent to US $ 7.6 million, though net losses tripled to US $ 32.4 million in 2021.
In its 10-K, the Group said it plans to utilise its equity line of credit — which it gained through a deal with Oasis Capital in 2021 — to finance its operations in 2022.
However, it said in its 10-K that it might not be able to draw on the credit line if its shares are delisted from the Nasdaq stock exchange.
Despite Digital Brands’ financial struggles, it has projected optimism about its future and added that its marketing spending has helped it acquire new customers.
Digital Brands Group, known for its curated collection of luxury lifestyle, digital-first brands, owns Bailey 44, Ace Studios, DSTLD and the Harper & Jones.
