Sent to the SEC "Tip" line yesterday. I want to make SURE that the SEC is well aware of DBMM's apparent deficiencies in the revenue numbers in their financial reports, and also Linda's wild and continuing (basically impossible) revenue forecasts.
Dear Sir/Madam,
I am writing to bring awareness to a few anomalies in DBMM’s recently published 3rd quarter financial report (9-month period ending May 31).
The first most glaring mistake is the total revenue figure quoted in Note 11 (Foreign Operations and Segment Reporting) on page 14 of the filing. The revenues listed for the US segment are stated as $20,340. The revenues listed for the Great Britain Segment are stated as $51,327. The TOTAL revenues of both segments are stated as $81,667. This total cannot be correct. Those figures total $71,667, NOT $81,667.
Following are the tabulations for each of the reported DBMM quarterlies:
US Revenues 3-month US stated revs of $7,755 6-month US stated revs of $7,755 (Indicating revs of $0 for the 2nd Q) 9-month US stated revs of $20,340 (Indicating revs of $12,585 for the 3rd Q)
Total US revs through 9 months - $20,340.
GB Revenues 3-month GB stated revs of $21,218 6-month GB stated revs of $48,822 (Indicating revs of $27,604 for the 2nd Q) 9-month GB stated revs of $51,327 (indicating revs of $2,505 for the 3rd Q)
Total GB revs through 9 months - $51,327
US revs ($20,340) plus GB revs ($51,327) through 9-months equals $71,667…NOT the $81,667 listed on page 14 of the financial.
These figures also PROVE that the 2025 3-month total revenue figure listed on page 4 of the 3rd quarter filing is incorrect. It is listed as $25,090. But if the US segment revenue is $12,585 for those three months ending May 31 (as the quarterly numbers indicate) and the GB segment revenue is actually $2,505 for the 3 months ending May 31 (as the quarterly numbers indicate)? The ACTUAL 3-month TOTAL revenue for the period ending May 31 must be $15,090, NOT $25,090. Interestingly, this $10K discrepancy is the exact amount that the incorrect 9-month revenue number listed on page 14 represents.
It is obvious that DBMM has given an exaggerated figure of revenue in its filings. These numbers DO NOT add up. Plus, DBMM has not informed the investing public of material changes in its revenue. It certainly looks like DBMM has lost the lion’s share of their UK customers and revenue in Q3. Also, why did DBMM not report a reason for GREATLY reduced US income in Q1 and NO US INCOME in Q2 filings? Is that not material in nature?
I would also like to draw your attention to the numerous large revenue predictions made by Linda Perry and Reggie James in several of DBMM’s public Investor Updates and quarterly filings. Several times, those updates have contained $1M revenue forecasts for DBMM’s Fiscal 2025 year. To date after filing three quarters of results, DBMM has less than $82K in revenue. As of this writing, DBMM has 5 business days left in Fiscal 2025 and has not publicly announced a SINGLE new revenue producing client in the entire Fiscal 2025 year. For myself, I never believed this $1M revenue prediction. But I’m sure at least SOME current investors (and prospective investors) looked at that revenue prediction as genuine and bought shares in anticipation of the revenue increase.
I can see a company missing revenue “predictions” by small percentages. But missing by over 90%? That’s preposterous! To me, it was a stunt, designed to both pump up DBMM’s share price and get investors to buy shares in DBMM. Each time they made these revenue predictions, Linda and Reggie knew very well that NO NEW CLIENTS were being signed on. Yet they made these outrageous revenue predictions regardless.
Indeed, in the last quarterly filing, DBMM found a reason to change the wording regarding revenue. Here is the wording from the 6-month 2nd Quarter filing (found on page 29):
"Therefore the 2025 milestone remains conservative compared to the years following as the revenues follow development testing and market readiness in first quarter of 2025. But even with the truncated revenue period remaining, Digital Clarity confidently has forecast over $1 million in revenue for this fiscal year ending August 31, 2025. As stated in the 10-K outlook, 2025 will be DBMM’s “best year ever.”
Now look at how that same section is worded here in the latest 9-month 3rd quarter filing (again found on Page 29):
"Therefore the 2025 milestone remains conservative compared to the years following as the revenues follow development testing and market readiness in first quarter of 2025. But even with the truncated revenue period remaining, Digital Clarity confidently has forecast over $1 million contractually for this fiscal year ending August 31, 2025. As stated in the 10-K outlook , 2025 will be DBMM’s “best year ever.”
It is interesting to ponder why Linda Perry would change the wording like that. It would not surprise me to see some sort of late year announcement of some type of “contract”, so that her forecast of $1M in revenue can be realized.
As with other DBMM “clients”, I’m sure the company providing this “contractual revenue” will not be named (likely claiming some sort of “NDA”). Investors trying to research and ascertain the veracity of this contract will be stymied.
Please look closely at this company. They continue to promise investors that great things are happening (or about to happen) yet they never deliver on those promises.
They continue to promise investors expansion into numerous US cities, expansion into Asia, expansion into the UAE – all of which has NEVER happened. They also talk about attaining the QB level of trading in the OTC (promised throughout 2024 and never attained) and mention a planned uplisting to the Nasdaq level. That is likely not even attainable – it would take several YEARS of STELLAR performance from a company that has never even achieved $1M in revenue in a single year of operation since inception. Yet Linda Perry continues to talk up a Nasdaq listing as if it is imminent.
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