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Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) For the quarterly period ended September 30, 2023 For the transition period Nevada 45-3598066 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) (972) 726-9203 (Registrant's telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: Indicate by check mark whether the registrant (1) has filed all reports required to be fi ...

June 30, December 31, | --- | --- | --- | --- | --- | |----------------------------------------------------|-------|--------------|-------|--------------| | | | | | | | Accumulated deficit | | (18,145,298) | | (14,820,436) | | Total stockholders' equity | | 8,368,411 | | 2,177,653 | | | | | | | | Total liabilities and stockholders' equity | $ | 10,194,691 | $ | 4,335,781 | 2 Blackboxstocks Inc. Statements of Operations For the Three and Six Months Ended June 30, 2023 and 2022 (Unaudited) Table of Contents B ...

Introductory Comment [Caution Regarding Forward-Looking Statements](index=4&type=section&id=CAUTION%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This section cautions that forward-looking statements involve substantial uncertainties and risks, and actual results may differ materially - The report contains forward-looking statements that involve substantial uncertainties and risks, and actual results may differ materially from those anticipated[7](index=7&type=chunk)[23](index=23&type=chunk)[87](index=87&type=chunk) - Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date made, and the company undertakes no obligation to publicly release revisions[23](index=23&type=chunk) PART I – FINANCIAL INFORMATION [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents unaudited Balance Sheets, Statements of Operations, Stockholders' Equity, and Cash Flows for Q1 **2023** and **2022** - The financial statements are unaudited and prepared in accordance with GAAP for interim financial information, and management believes they contain all necessary normal recurring adjustments for a fair presentation[64](index=64&type=chunk) [Balance Sheets as of March 31, 2023 and December 31, 2022 (Unaudited)](index=5&type=section&id=Balance%20Sheets%20as%20of%20March%2031%2C%202023%20and%20December%2031%2C%202022%20(Unaudited)) Total assets and equity decreased, driven by reduced marketable securities and an increased accumulated deficit Balance Sheet Highlights | Metric | March 31, 2023 (in $K) | December 31, 2022 (in $K) | Change (in $K) | | :-------------------------- | :------------- | :---------------- | :----- | | Total assets | $3,194,361 | $4,335,781 | $(1,141,420) | | Total current liabilities | $1,946,593 | $1,852,875 | $93,718 | | Total long term liabilities | $281,457 | $305,253 | $(23,796) | | Total stockholders' equity | $966,311 | $2,177,653 | $(1,211,342) | | Cash | $249,818 | $425,578 | $(175,760) | | Marketable securities | $2,180,590 | $3,216,280 | $(1,035,690) | | Accumulated deficit | $(16,720,804) | $(14,820,436) | $(1,900,368) | [Statements of Operations for the Three Months Ended March 31, 2023 and 2022 (Unaudited)](index=7&type=section&id=Statements%20of%20Operations%20for%20the%20Three%20Months%20Ended%20March%2031%2C%202023%20and%202022%20(Unaudited)) Net loss significantly increased due to a **33% revenue decrease** and **38% rise in operating expenses** Key Income Statement Figures (Three Months Ended March 31) | Metric | 2023 (in $K) | 2022 (in $K) | Change (YoY) (in $K) | | :-------------------------------- | :----------- | :----------- | :----------- | | Total revenues | $859,004 | $1,272,486 | $(413,482) (-32.5%) | | Cost of revenues | $447,631 | $579,962 | $(132,331) (-22.8%) | | Gross margin | $411,373 | $692,524 | $(281,151) (-40.6%) | | Total operating expenses | $2,358,177 | $1,713,678 | $644,499 (37.6%) | | Operating loss | $(1,946,804) | $(1,021,154) | $(925,650) (-90.6%) | | Net loss | $(1,900,368) | $(1,242,443) | $(657,925) (-53.0%) | | Net loss per share – basic and diluted | $(0.58) | $(0.38) | $(0.20) | - The decline in revenues is attributed to macro-economic factors such as poor stock market performance, high inflation, and sluggish GDP growth, which may have constricted disposable cash of prospective subscribers[139](index=139&type=chunk) [Statement of Stockholders' Equity for the Three Months Ended March 31, 2023 and 2022 (Unaudited)](index=8&type=section&id=Statement%20of%20Stockholders'%20Equity%20for%20the%20Three%20Months%20Ended%20March%2031%2C%202023%20and%202022%20(Unaudited)) Stockholders' equity decreased due to a **$1.90 billion** net loss and reduced additional paid-in capital Stockholders' Equity Changes (Three Months Ended March 31, 2023) | Metric | December 31, 2022 (in $K) | March 31, 2023 (in $K) | Change (in $K) | | :-------------------------- | :---------------- | :------------- | :----- | | Common stock, par value $0.001 | $3,928 | $3,126 | $(802) | | Treasury stock | $(1,102,375) | $0 | $1,102,375 | | Additional paid in capital | $18,070,556 | $17,637,999 | $(432,557) | | Accumulated deficit | $(14,820,436) | $(16,720,804) | $(1,900,368) | | Total stockholders' equity | $2,177,653 | $966,311 | $(1,211,342) | - The company retired **171,940 shares** of Common Stock acquired through its repurchase plan in **February 2023** and an additional **282,501 shares** from Mr. Kepler in **March 2023**, which were subsequently retired[49](index=49&type=chunk)[81](index=81&type=chunk) [Statements of Cash Flows for the Three Months Ended March 31, 2023 and 2022 (Unaudited)](index=9&type=section&id=Statements%20of%20Cash%20Flows%20for%20the%20Three%20Months%20Ended%20March%2031%2C%202023%20and%202022%20(Unaudited)) Net cash decreased due to significant operating cash outflow, partially offset by investing cash inflow from marketable securities sales Key Cash Flow Figures (Three Months Ended March 31) | Metric | 2023 (in $K) | 2022 (in $K) | Change (YoY) (in $K) | | :------------------------------------ | :------------ | :------------ | :------------ | | Net cash used in operating activities | $(1,250,895) | $(793,188) | $(457,707) | | Net cash provided by (used in) investing activities | $1,082,291 | $(85,094) | $1,167,385 | | Net cash used in financing activities | $(7,156) | $(896,697) | $889,541 | | Net decrease in cash | $(175,760) | $(1,774,979) | $1,599,219 | | Cash - end of period | $249,818 | $651,518 | $(401,700) | - The increase in cash flow from investing activities was primarily due to the liquidation of marketable securities to fund operations[106](index=106&type=chunk) [Notes to Financial Statements for the Three Months Ended March 31, 2023 and 2022](index=10&type=section&id=Notes%20to%20Financial%20Statements%20for%20the%20Three%20Months%20Ended%20March%2031%2C%202023%20and%202022) These notes detail organization, accounting policies, marketable securities, equity, warrants, stock plans, related parties, debt, and contingencies - The notes are an integral part of the financial statements, providing additional context and detail[15](index=15&type=chunk)[58](index=58&type=chunk)[59](index=59&type=chunk) [1. Organization](index=10&type=section&id=1.%20Organization) Blackboxstocks Inc. operates an AI-enhanced financial technology and social media platform for stock and options traders - Blackboxstocks Inc. operates as a financial technology and social media platform, offering real-time proprietary analytics and news for stock and options traders[37](index=37&type=chunk)[88](index=88&type=chunk) - The platform uses "predictive technology" enhanced by artificial intelligence to identify volatility and unusual market activity, scanning over **10,000 stocks** and **1,500,000 options contracts** multiple times per second[37](index=37&type=chunk)[88](index=88&type=chunk) - The company's common stock was listed on the Nasdaq Capital Market under the symbol "BLBX" following its initial public offering on **November 10, 2021**[63](index=63&type=chunk)[101](index=101&type=chunk) [2. Summary of Significant Accounting Policies](index=10&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) This section outlines key accounting policies, including going concern assumption, marketable securities, revenue recognition, and cash definition - The financial statements are prepared under the assumption of a going concern, but the company's operating losses and negative cash flows raise substantial doubt about its ability to continue as a going concern[39](index=39&type=chunk)[105](index=105&type=chunk) - Management is implementing initiatives to improve cash flow, including new product development, revised marketing strategies, and expense reductions, and has entered a non-binding LOI for a reverse merger with Evtec Group Limited[39](index=39&type=chunk)[105](index=105&type=chunk) - Revenue is recognized over the subscription period for its SaaS model, with unearned subscriptions recorded for cash received but not yet earned[44](index=44&type=chunk)[69](index=69&type=chunk) [3. Marketable Securities](index=11&type=section&id=3.%20Marketable%20Securities) Marketable securities, primarily mutual funds, decreased significantly due to sales exceeding purchases - Marketable securities are primarily investments in mutual funds holding commercial and government debt securities, recorded at fair value using Level **1** inputs[42](index=42&type=chunk)[73](index=73&type=chunk) Marketable Securities Activity (Three Months Ended March 31, 2023) | Metric | Amount (in $K) | | :------------------- | :------------- | | Balance at Dec 31, 2022 | $3,216,280 | | Purchases | $889,018 | | Sales | $(1,971,309) | | Change in fair value | $46,601 | | Balance at Mar 31, 2023 | $2,180,590 | [4. Stockholders' Equity](index=13&type=section&id=4.%20Stockholders'%20Equity) This note details authorized and outstanding common and preferred stock, including CEO-held Series A and common stock retirements - The company has authorized **100,000,000 shares** of common stock and **10,000,000 shares** of preferred stock, with **5,000,000** designated as Series A Convertible Preferred Stock[74](index=74&type=chunk) - All outstanding Series A Stock is held by the CEO, Gust Kepler, with conversion rights to common stock dependent on market capitalization thresholds (e.g., **5-for-1** below **$150 million**, **1-for-1** above **$350 million**)[47](index=47&type=chunk)[75](index=75&type=chunk) - In **February** and **March 2023**, the company retired **171,940 shares** of common stock from its repurchase plan and **282,501 shares** from Mr. Kepler (in lieu of a bonus), returning them to authorized but unissued shares[49](index=49&type=chunk)[81](index=81&type=chunk) [5. Warrants to Purchase Common Stock](index=15&type=section&id=5.%20Warrants%20to%20Purchase%20Common%20Stock) As of **March 31, 2023**, **109,584** warrants were outstanding with a **$13.24** exercise price and **4.28 years** remaining life Warrants Outstanding (March 31, 2023) | Metric | Value | | :-------------------------------- | :------ | | Number of Shares | 109,584 | | Weighted Average Exercise Price (in $) | $13.24 | | Weighted Average Remaining Life (in years) | 4.28 | - As of **March 31, 2023**, **97,779 warrants** were vested, and the company expects to incur **$180.66 thousand** in expenses for the remaining unvested warrants as they vest[79](index=79&type=chunk) [6. Incentive Stock Plan](index=15&type=section&id=6.%20Incentive%20Stock%20Plan) The **2021** Incentive Stock Plan was amended to **612,500** shares, with **156,542** options outstanding and restricted stock granted - The **2021** Blackboxstocks, Inc. Incentive Stock Plan was amended to increase the number of shares available for issuance to **612,500**[93](index=93&type=chunk) Options Outstanding (March 31, 2023) | Metric | Value | | :-------------------------------- | :------ | | Number of Shares | 156,542 | | Weighted Average Exercise Price (in $) | $11.69 | | Weighted Average Remaining Life (in years) | 8.53 | - During **February 2023**, **282,501 shares** of restricted common stock valued at **$655.40 thousand** were granted and vested at issuance[53](index=53&type=chunk) [7. Related Party Transactions](index=15&type=section&id=7.%20Related%20Party%20Transactions) The company purchased **282,501** common shares from CEO Mr. Kepler for **$0.28** per share in lieu of his **2022** bonus - The company purchased **282,501 shares** of common stock from CEO Mr. Kepler for **$0.28** per share on **March 16, 2023**, in lieu of his **2022** cash bonus, and subsequently retired these shares[81](index=81&type=chunk) [8. Debt](index=16&type=section&id=8.%20Debt) The company has an outstanding Paycheck Protection Program loan of **$61.19 thousand** at **1%** interest, maturing **May 4, 2025** - The company has an outstanding Paycheck Protection Program loan with an unpaid balance of **$61.19 thousand** as of **March 31, 2023**, carrying a **1%** interest rate and maturing on **May 4, 2025**[56](index=56&type=chunk) [9. Commitments and Contingencies](index=16&type=section&id=9.%20Commitments%20and%20Contingencies) No material litigation is reported; an office lease extends to **September 30, 2028**, with **$508.14 thousand** in future obligations - The company is not currently a defendant in any material litigation or threatened litigation that could materially affect its financial statements[84](index=84&type=chunk) Future Lease Payment Obligations (as of March 31, 2023) | Year | Amount (in $) | | :--------- | :------- | | 2023 | $66,286 | | 2024 | $89,948 | | 2025 | $91,122 | | 2026 | $93,136 | | 2027 | $95,150 | | Thereafter | $72,495 | | **Total remaining lease payments** | **$508,137** | | Less: imputed interest | $(190,383) | | **Present Value of remaining lease payments** | **$317,754** | [10. Subsequent Events](index=17&type=section&id=10.%20Subsequent%20Events) On **April 10, 2023**, the company effected a **one-for-four** reverse stock split, adjusting options, warrants, and incentive plan shares - On **April 10, 2023**, the company implemented a **one-for-four** reverse stock split, which also resulted in proportionate adjustments to outstanding stock options, warrants, and shares under incentive plans[77](index=77&type=chunk)[86](index=86&type=chunk)[92](index=92&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=17&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 **2023** financial performance, liquidity, and capital, highlighting macroeconomic challenges and going concern risk - The discussion should be read in conjunction with the annual report on Form 10-K and contains forward-looking statements subject to risks and uncertainties[87](index=87&type=chunk) [Overview](index=17&type=section&id=Overview) Blackboxstocks Inc. operates the "Blackbox System," an AI-enhanced financial technology and social media platform for traders - The Blackbox System is a unique financial technology platform combining proprietary analytics and broadcast-enabled social media for traders, utilizing AI-enhanced "predictive technology"[88](index=88&type=chunk)[100](index=100&type=chunk) - The platform offers real-time alerts, scanners, financial news, institutional-grade charting, and proprietary analytics through a user-friendly dashboard, integrated with a social media platform and live audio/video features[88](index=88&type=chunk)[100](index=100&type=chunk) - The company operates on a subscription-based Software as a Service (SaaS) business model, serving a growing user base in **42** countries[88](index=88&type=chunk)[89](index=89&type=chunk) [Basis of Presentation](index=18&type=section&id=Basis%20of%20Presentation) Financial statements assume going concern, despite significant losses and negative cash flows raising substantial doubt about continuation - The financial statements are prepared assuming the company will continue as a going concern, but significant operating losses and negative cash flows raise substantial doubt about this ability[105](index=105&type=chunk) [Significant Accounting Policies](index=18&type=section&id=Significant%20Accounting%20Policies) No changes occurred in significant accounting policies from the **2022** Annual Report on Form 10-K - No changes have occurred in the Summary of Significant Accounting Policies from the Annual Report on Form 10-K for the year ended **December 31, 2022**[114](index=114&type=chunk) [Liquidity and Capital Resources](index=18&type=section&id=Liquidity%20and%20Capital%20Resources) Cash and marketable securities decreased significantly, with substantial cash used in operations, leading to going concern risk Cash and Marketable Securities | Metric | March 31, 2023 (in $K) | December 31, 2022 (in $K) | Change (in $K) | | :-------------------------- | :------------- | :---------------- | :----- | | Cash and marketable securities | $2,430,408 | $3,641,858 | $(1,211,450) | | Cash flows used in operations | $(1,250,895) | $(793,188) (prior year period) | $(457,707) | - Net cash from investing activities increased to **$1.08 billion** for Q1 **2023** (from **$(85.09 million)** in Q1 **2022**) due to the liquidation of marketable securities to fund operations[106](index=106&type=chunk) - The company intends to pursue a reverse merger with Evtec Group Limited to address liquidity concerns, but there is no assurance of completion or sufficient capital[105](index=105&type=chunk)[138](index=138&type=chunk) [Results of Operations](index=19&type=section&id=Results%20of%20Operations) Q1 **2023** saw a **33% revenue decrease** and **38% operating expense increase**, resulting in higher operating and net losses - Revenues decreased by **33%** for the three months ended **March 31, 2023**, compared to the prior year, primarily due to macroeconomic factors like poor stock market performance, high inflation, and sluggish GDP growth[139](index=139&type=chunk) - Operating expenses increased by **38%** to **$2.36 billion**, driven by a **45%** rise in selling, general, and administrative expenses (due to higher stock-based compensation) and a **92%** increase in software development costs for platform improvements and the new "Stock Nanny" product[118](index=118&type=chunk) - The operating loss for Q1 **2023** was **$(1.95 billion)**, a significant increase from **$(1.02 billion)** in Q1 **2022**, due to lower sales and higher operating expenses[109](index=109&type=chunk) [EBITDA (Non-GAAP Financial Measure)](index=20&type=section&id=EBITDA%20(Non-GAAP%20Financial%20Measure)) EBITDA, a non-GAAP measure, shows a **$(1.17 billion)** loss for Q1 **2023**, larger than the prior year - EBITDA is a non-GAAP measure defined as net income (loss) before interest expense, income tax, depreciation and amortization expense, and certain non-cash items, used by management to compare operating performance[110](index=110&type=chunk)[119](index=119&type=chunk) EBITDA Reconciliation (Three Months Ended March 31) | Metric | 2023 (in $K) | 2022 (in $K) | | :-------------------------- | :------------- | :------------- | | Net income (loss) | $(1,900,368) | $(1,242,443) | | Total adjustments | $732,208 | $348,597 | | **EBITDA** | **$(1,168,160)** | **$(893,846)** | [Off Balance Sheet Arrangements](index=21&type=section&id=Off%20Balance%20Sheet%20Arrangements) As of **March 31, 2023**, the company did not have any material off-balance sheet arrangements - The company did not have any material off-balance sheet arrangements as of **March 31, 2023**[143](index=143&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=21&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a "smaller reporting company," Blackboxstocks Inc. is not required to provide detailed market risk disclosures - As a "smaller reporting company," the registrant is not required to provide the information for this item[121](index=121&type=chunk) [Item 4. Controls and Procedures](index=21&type=section&id=Item%204.%20Controls%20and%20Procedures) The principal executive and financial officers evaluated the effectiveness of the company's disclosure controls and procedures as of **March 31, 2023**, concluding they were effective in providing reasonable assurance for timely disclosure - The principal executive and financial officers concluded that the company's disclosure controls and procedures were effective as of **March 31, 2023**, to provide reasonable assurance for timely disclosure[144](index=144&type=chunk) - There were no material changes in internal controls over financial reporting during the quarter ended **March 31, 2023**[145](index=145&type=chunk) - Management acknowledges that control systems provide only reasonable, not absolute, assurance and are subject to inherent limitations such as human error, resource constraints, and potential circumvention[146](index=146&type=chunk) PART II – OTHER INFORMATION [Item 1. Legal Proceedings](index=22&type=section&id=Item%201.%20Legal%20Proceedings) The company reported no material legal proceedings for the period - There are no material legal proceedings to report[126](index=126&type=chunk) [Item 1A. Risk Factors](index=22&type=section&id=Item%201A.%20Risk%20Factors) Readers are referred to the **2022** Form 10-K and Form S-1 for important risk factors - Important risk factors are described in the company's Annual Report on Form 10-K and registration statement on Form S-1[127](index=127&type=chunk) - The listed risks are not exhaustive, and other unknown or currently immaterial risks may also adversely affect the business[127](index=127&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=22&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales were reported; public offering proceeds funded promotion, and common stock was repurchased under a plan and from the CEO - No unregistered sales of securities were made during the period that have not been previously reported[148](index=148&type=chunk) - Proceeds from the public offering were used to promote and market the Blackbox System platform, increase the subscriber base, and cover general and administration expenses[128](index=128&type=chunk) - The company repurchased **171,940 shares** for **$1.10 million** under a stock repurchase plan (authorized for up to **$2.5 million** until **Dec 31, 2023**) and an additional **282,501 shares** for **$79.10 thousand** outside the plan[129](index=129&type=chunk)[149](index=149&type=chunk) [Item 3. Defaults Upon Senior Securities](index=23&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities - There are no defaults upon senior securities to report[130](index=130&type=chunk) [Item 4. Mine Safety Disclosures](index=23&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - This item is not applicable to the company[131](index=131&type=chunk) [Item 5. Other Information](index=23&type=section&id=Item%205.%20Other%20Information) The company reported no other information required to be disclosed under this item - No other information is required to be disclosed under this item[132](index=132&type=chunk) [Item 6. Exhibits](index=23&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Quarterly Report on Form 10-Q, including officer certifications and interactive data files Exhibits Filed | Exhibit | Description | | :------ | :---------------------------------------------------------------------------------------------------- | | 31.1 | Certification of Principal Executive Officer pursuant to Rule 13a-14a/Rule 14d-14(a)* | | 31.2 | Certification of Principal Financial Officer pursuant to Rule 13a-14a/Rule 14d-14(a)* | | 32.1 | Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350** | | 32.2 | Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350** | | 101.1 | Inline Interactive data files pursuant to Rule 405 of Regulation S-T* | | 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). | SIGNATURES [Signatures](index=23&type=section&id=SIGNATURES_DETAIL) The report was signed by Gust Kepler (President, CEO, Secretary) and Robert Winspear (CFO, Secretary) on **May 15, 2023** - The report was signed by Gust Kepler (President, CEO, and Secretary) and Robert Winspear (CFO and Secretary) on **May 15, 2023**[133](index=133&type=chunk)[135](index=135&type=chunk)[153](index=153&type=chunk)[155](index=155&type=chunk)

INTRODUCTORY COMMENT When used in this Report, the words "may," "will," "expect," "anticipate," "continue," "estimate," "intend," and similar expressions are intended to identify forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act") regarding events, conditions and financial trends which may affect the Company's future plans of operations, business s ...

Blackboxstocks Inc. (NASDAQ:BLBX) Q3 2022 Earnings Conference Call November 15, 2022 10:30 AM ET Company Participants Stephanie Prince - Investor Relations, PCG Advisory Gust Kepler - Chief Executive Officer Bob Winspear - Chief Financial Officer Conference Call Participants Joshua Zoepfel - Noble Capital Markets Ed Woo - Ascendiant Capital Operator Good day, and welcome to the Blackboxstocks Third Quarter 2022 Earnings Conference Call. All participants will be in listen only mode. [Operator Instructions] A ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission 001-41051 File No. BLACKBOXSTOCKS INC. (Exact name of registrant as specified in its charter) Nevada 45-3598066 (State or ...

Blackboxstocks Inc.(NASDAQ:BLBX) Q2 2022 Earnings Conference Call August 15, 2022 4:30 PM ET Company Participants Stephanie Prince - Investor Relations, PCG Advisory Gust Kepler - Chief Executive Officer Robert Winspear - Chief Financial Officer Conference Call Participants Edward Woo - Ascendiant Capital Joe Gomes - Noble Capital Brian Smith - Security Research Associates Operator Good day and welcome to the Blackboxstocks Second Quarter 2022 Earnings Conference Call. All participants will be in listen onl ...

[PART I – FINANCIAL INFORMATION](index=5&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) This section presents Blackboxstocks Inc.'s unaudited financial statements as of June 30, 2022, detailing asset, liability, equity, operations, and cash flow changes [Balance Sheets](index=5&type=section&id=Balance%20Sheets) Total assets decreased to **$7.65 million** from **$11.15 million** at year-end 2021, primarily due to reduced cash and marketable securities Balance Sheet Summary (Unaudited) | Account | June 30, 2022 | December 31, 2021 | | :--- | :--- | :--- | | **Total Current Assets** | $7,209,621 | $10,701,971 | | Cash | $335,106 | $2,426,497 | | Marketable Securities | $6,734,720 | $8,015,882 | | **Total Assets** | **$7,647,221** | **$11,150,114** | | **Total Current Liabilities** | $2,731,496 | $2,928,676 | | **Total Liabilities** | $3,085,550 | $3,332,664 | | **Total Stockholders' Equity** | **$4,561,671** | **$7,817,450** | [Statements of Operations](index=7&type=section&id=Statements%20of%20Operations) Revenue slightly decreased for Q2 2022, while operating expenses significantly increased, resulting in a **$1.32 million** net loss for the quarter and a **$2.56 million** net loss for the six-month period Three Months Ended June 30 (Unaudited) | Metric | 2022 | 2021 | | :--- | :--- | :--- | | Total Revenues | $1,399,315 | $1,463,606 | | Gross Margin | $899,888 | $1,054,029 | | Total Operating Expenses | $2,068,654 | $1,171,551 | | Net Loss | $(1,316,099) | $(243,336) | | Net Loss Per Share | $(0.10) | $(0.03) | Six Months Ended June 30 (Unaudited) | Metric | 2022 | 2021 | | :--- | :--- | :--- | | Total Revenues | $2,671,801 | $2,953,274 | | Gross Margin | $1,592,412 | $2,147,922 | | Total Operating Expenses | $3,782,332 | $2,120,312 | | Net Loss | $(2,558,542) | $(230,781) | | Net Loss Per Share | $(0.19) | $(0.03) | [Statement of Stockholders' Equity (Deficit)](index=8&type=section&id=Statement%20of%20Stockholders'%20Equity%20(Deficit)) Stockholders' equity declined to **$4.56 million** by June 30, 2022, primarily due to a **$2.56 million** net loss and **$0.95 million** in treasury stock repurchases - Key activities impacting stockholders' equity in the first six months of 2022 include the net loss of **$2,558,542** and the purchase of treasury stock for **$945,449**[23](index=23&type=chunk) [Statements of Cash Flows](index=9&type=section&id=Statements%20of%20Cash%20Flows) Net cash used in operating activities significantly increased to **$2.04 million** for the six months ended June 30, 2022, resulting in a **$2.09 million** net decrease in cash Cash Flow Summary for Six Months Ended June 30 (Unaudited) | Cash Flow Activity | 2022 | 2021 | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | $(2,038,532) | $(26,192) | | Net Cash Provided by (Used in) Investing Activities | $966,779 | $(54,507) | | Net Cash Used in Financing Activities | $(1,019,638) | $(265,636) | | **Net Decrease in Cash** | **$(2,091,391)** | **$(346,335)** | | **Cash - End of Period** | **$335,106** | **$626,490** | [Notes to Financial Statements](index=10&type=section&id=Notes%20to%20Financial%20Statements) The notes detail the company's SaaS business model, revenue recognition, marketable securities, a **$2.5 million** stock repurchase plan, and a **$0.93 million** outstanding note payable - The Company operates a SaaS model, recognizing revenue from monthly and annual subscriptions over the subscription period[41](index=41&type=chunk) - On January 7, 2022, the Board authorized a stock repurchase plan for up to **$2.5 million**. As of June 30, 2022, **499,028 shares** were repurchased for **$945,449**[49](index=49&type=chunk) - The Company has a **$1 million** note payable with a **12% interest rate**, with an unpaid balance of **$930,000** as of June 30, 2022[58](index=58&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=15&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes a Q2 2022 revenue decrease to macroeconomic factors, while operating expenses significantly rose, leading to a substantial net loss, yet believes sufficient capital exists for future operations [Overview](index=15&type=section&id=Overview) Blackboxstocks provides real-time stock and options analytics through a subscription-based SaaS platform, leveraging AI-enhanced predictive technology and social features for a global user base - The company's web-based software scans over **10,000 stocks** and **1,500,000 options contracts per second** using AI-enhanced predictive technology[65](index=65&type=chunk) - The business model is a subscription-based Software as a Service (SaaS) with a growing user base across **42 countries**[65](index=65&type=chunk) [Liquidity and Capital Resources](index=15&type=section&id=Liquidity%20and%20Capital%20Resources) Cash and marketable securities decreased to **$7.07 million** by June 30, 2022, with **$2.04 million** used in operations and **$0.95 million** for stock repurchases, though management expects sufficient capital for the next twelve months Cash and Marketable Securities | Date | Amount | | :--- | :--- | | June 30, 2022 | $7,069,826 | | December 31, 2021 | $10,442,379 | - Cash used in operations for the six months ended June 30, 2022, was **($2,038,532)**, compared to **($26,192)** for the same period in 2021[70](index=70&type=chunk) - The company believes it has sufficient capital to fund operations and debt service for the next twelve months, following its public offering which raised net proceeds of approximately **$10.51 million**[74](index=74&type=chunk)[75](index=75&type=chunk) [Results of Operations](index=16&type=section&id=Results%20of%20Operations) Revenue declined due to negative macroeconomic conditions, while increased operating expenses, including marketing and software development, led to a significantly larger net loss for both the three and six-month periods - Management attributes the decline in revenues to negative macro-economic factors such as poor stock market performance, high inflation, and negative GDP growth[76](index=76&type=chunk) - Operating expenses are expected to continue increasing due to investments in digital advertising, marketing, and software development for new products and features[78](index=78&type=chunk) [EBITDA (Non-GAAP Financial Measure)](index=17&type=section&id=EBITDA%20(Non-GAAP%20Financial%20Measure)) EBITDA for the three months ended June 30, 2022, was a **$1.04 million** loss, and a **$1.93 million** loss for the six-month period, a significant shift from the prior year Reconciliation of Net Loss to EBITDA | Period | Net Loss | EBITDA | | :--- | :--- | :--- | | **Three Months Ended June 30, 2022** | $(1,316,099) | $(1,036,737) | | **Three Months Ended June 30, 2021** | $(243,336) | $(112,141) | | **Six Months Ended June 30, 2022** | $(2,558,542) | $(1,930,583) | | **Six Months Ended June 30, 2021** | $(230,781) | $37,315 | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=18&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a "smaller reporting company," the company is exempt from providing quantitative and qualitative disclosures about market risk - As a "smaller reporting company," the company is exempt from providing quantitative and qualitative disclosures about market risk[89](index=89&type=chunk) [Item 4. Controls and Procedures](index=18&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2022, with no material changes to internal control over financial reporting during the quarter - The principal executive officer and principal financial officer concluded that the Company's disclosure controls and procedures were effective as of June 30, 2022[90](index=90&type=chunk) - No changes in internal controls over financial reporting occurred during the quarter ended June 30, 2022, that have materially affected or are likely to materially affect internal controls[91](index=91&type=chunk) [PART II – OTHER INFORMATION](index=19&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=19&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no involvement in any legal proceedings - The company is not involved in any legal proceedings[95](index=95&type=chunk) [Item 1A. Risk Factors](index=19&type=section&id=Item%201A.%20Risk%20Factors) This section refers to previously disclosed risk factors in the Annual Report on Form 10-K and Form S-1, indicating no material changes - For a discussion of risk factors, the report refers to the Company's Annual Report on Form 10-K filed on March 31, 2022, and its Form S-1 registration statement[96](index=96&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=19&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales occurred, and public offering proceeds were used for marketing and general expenses, including a stock repurchase plan that bought back **499,028 shares** for **$0.95 million** - There were no sales of unregistered securities during the reporting period that have not been previously reported[97](index=97&type=chunk) - A stock repurchase plan was authorized on January 7, 2022, for up to **$2.5 million**. As of June 30, 2022, the company had repurchased **499,028 shares** for an aggregate price of **$945,449**[98](index=98&type=chunk) Issuer Purchases of Equity Securities (as of June 30, 2022) | Period | Total Shares Purchased | Average Price Paid | Max Dollar Value Remaining | | :--- | :--- | :--- | :--- | | **Total** | **499,028** | **$1.97** | **$1,554,551** | [Item 3. Defaults Upon Senior Securities](index=20&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reports no defaults upon senior securities - There were no defaults upon senior securities[103](index=103&type=chunk) [Item 4. Mine Safety Disclosures](index=20&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company's operations - This section is not applicable[104](index=104&type=chunk) [Item 5. Other Information](index=20&type=section&id=Item%205.%20Other%20Information) The company reports no other information for this section - There is no other information to report[105](index=105&type=chunk) [Item 6. Exhibits](index=20&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Quarterly Report on Form 10-Q, including officer certifications and interactive data files - Exhibits filed with the report include officer certifications (31.1, 31.2, 32.1, 32.2) and Inline XBRL interactive data files (101.1, 104)[108](index=108&type=chunk)

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2022 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to | --- | --- | --- | |-------------------------|-----------------------|-------| | Commission File \nNo. | 001-41051 | | | | BLACKBOXSTOCK ...