Algorhythm Holdings, Inc. (NASDAQ:RIME), a Delaware-incorporated company specializing in phonograph records and prerecorded audio tapes and disks, announced today a significant change to its capital structure. According to InvestingPro data, the company currently shows weak financial health with negative EBITDA of $10.6 million in the last twelve months. The company has confirmed that a 1-for-200 reverse stock split of its common stock is set to take effect at the start of trading on Monday, February 10, 2025.
This corporate action comes after Algorhythm Holdings disclosed that as of today, it has 476,359,875 shares of common stock issued and outstanding. This figure includes shares that have been issued upon the exercise of Series B Warrants under a securities purchase agreement dated December 4, 2025. The company’s stock has experienced significant volatility, with a 96.8% decline over the past year and currently trades at $0.02 per share.
The reverse stock split is expected to reduce the number of outstanding shares to approximately 2,381,799, not including rounding adjustments for fractional shares resulting from the split. Fractional shares will be rounded up to the nearest whole share, as stated in the company’s filing.
Algorhythm Holdings, previously known as Singing Machine Co Inc, is headquartered in Fort Lauderdale, FL, and trades on The Nasdaq Capital Market under the ticker symbol RIME. The company’s CEO, Gary Atkinson, signed off on the SEC filing, confirming the details of the reverse stock split.
The move is designed to adjust the number of shares available in the market and may have implications for the stock’s liquidity and marketability. With a market capitalization of just $1.97 million and a current ratio of 0.87, InvestingPro analysis reveals 14 additional key insights about the company’s financial position and future prospects. The company has not provided any additional commentary on the reasons behind the reverse split or its expected impact on the company’s market position.
The information in this article is based on a press release statement filed with the SEC.
In other recent news, Algorhythm Holdings has been active with several significant developments. The company announced a reverse stock split at a ratio of 1-for-200 and an increase in authorized common stock from 100,000,000 to 800,000,000 shares. This strategic move aims to adjust the number of shares available and outstanding, a common practice among public companies.
Algorhythm Holdings also disclosed a registered direct offering of its common stock, expected to result in $2 million in gross proceeds. The company agreed to sell approximately 24.07 million shares at a price of $0.0831 each. Univest Securities, LLC is serving as the exclusive placement agent for this offering.
Moreover, the company priced a public offering expected to generate approximately $9.5 million in gross proceeds. This offering includes 55,882,353 shares of common stock or pre-funded warrants, plus accompanying Series A and Series B Warrants.
However, Algorhythm Holdings is also facing potential delisting from the Nasdaq Stock Market due to non-compliance with the Bid Price Rule. The company plans to request a hearing before the Nasdaq Hearings Panel to delay any further delisting actions.
These recent developments are based on information provided in the latest 8-K filing by Algorhythm Holdings, Inc. with the Securities and Exchange Commission, as well as press release statements from the company.
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