Core Insights - Intellinetics, Inc. (INLX) reported a quarterly loss of $0.08 per share, which was better than the Zacks Consensus Estimate of a loss of $0.10, representing an earnings surprise of +20.00% [1] - The company posted revenues of $4 million for the quarter ended September 2025, missing the Zacks Consensus Estimate by 7.38% and down from $4.59 million a year ago [2] - Intellinetics shares have declined approximately 33.2% year-to-date, contrasting with the S&P 500's gain of 16.4% [3] Financial Performance - Over the last four quarters, Intellinetics has surpassed consensus EPS estimates two times [2] - The current consensus EPS estimate for the upcoming quarter is -$0.10 on revenues of $4.46 million, and for the current fiscal year, it is -$0.50 on revenues of $17.03 million [7] Industry Outlook - The Zacks Industry Rank for Internet - Content is currently in the bottom 16% of over 250 Zacks industries, indicating potential challenges for stock performance [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact investor sentiment [5]

Intellinetics (NYSEAM:INLX) Q3 2025 Earnings Call November 12, 2025 04:30 PM ET Speaker0Greetings and welcome to Intellinetics third quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to Roger Grabne ...

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended September 30, 2025 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____________________to _________________________ Commission file number: 001-41495 INTELLINETICS, INC. (Exact name of registrant as specified in its charter) Nevada 87-0613716 (State or Other Jurisdiction of Incorporation or Organization) (I.R.S. Em ...

Intellinetics Reports Third Quarter Results COLUMBUS, OH – November 12, 2025 – Intellinetics, Inc. (NYSE American: INLX), a digital transformation solutions provider, announced financial results for the third quarter of 2025 and nine months ended September 30, 2025. 2025 Third Quarter Highlights | | For the Quarter ended | | | | | --- | --- | --- | --- | --- | | | September 30, | | | | | | | 2025 | 2024 | | | Revenues: | | | | | | Software as a service | | $ 1,608,253 | $ | 1,403,942 | | Software maintenanc ...

Core Insights - Intellinetics, Inc. (INLX) has received an upgrade to a Zacks Rank 1 (Strong Buy), indicating a positive shift in earnings estimates which is a significant factor influencing stock prices [1][3][10] Earnings Estimates and Stock Performance - The Zacks rating system is based on changes in earnings estimates, which are closely correlated with stock price movements, particularly due to institutional investors' reliance on these estimates for valuation [4][6] - For the fiscal year ending December 2025, Intellinetics is expected to earn -$0.50 per share, unchanged from the previous year, but the Zacks Consensus Estimate has increased by 5.7% over the past three months [8] Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [7] - The upgrade of Intellinetics to Zacks Rank 1 places it in the top 5% of Zacks-covered stocks, suggesting potential for higher stock prices in the near term [10]

Core Viewpoint - Intellinetics, Inc. (INLX) has experienced a downtrend, losing 13.1% over the past week, but a hammer chart pattern suggests a potential trend reversal as buying interest may be emerging to counteract selling pressure [1][2]. Technical Analysis - The hammer chart pattern indicates a possible bottoming out, with reduced selling pressure, suggesting that bulls may be gaining control [2][5]. - A hammer pattern forms when there is a small candle body with a long lower wick, indicating that the stock opened lower, made a new low, but closed near its opening price, reflecting buying interest [4][5]. - The effectiveness of the hammer pattern is enhanced when used alongside other bullish indicators, as its strength is dependent on its placement on the chart [6]. Fundamental Analysis - There has been a positive trend in earnings estimate revisions for INLX, which is a bullish indicator, as it typically leads to price appreciation [7]. - The consensus EPS estimate for the current year has increased by 5.7% over the last 30 days, indicating strong agreement among analysts regarding improved earnings potential [8]. - INLX holds a Zacks Rank of 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks, which historically outperforms the market [9][10].

Core Viewpoint - Intellinetics, Inc. reported a quarterly loss of $0.13 per share, which was better than the Zacks Consensus Estimate of a loss of $0.16, representing an earnings surprise of +18.75% [1] Financial Performance - The company posted revenues of $4.01 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 5.62% and down from $4.64 million a year ago [2] - Over the last four quarters, Intellinetics has surpassed consensus EPS estimates only once [2] Stock Performance - Intellinetics shares have declined approximately 23.7% since the beginning of the year, while the S&P 500 has gained 9.6% [3] - The current Zacks Rank for Intellinetics is 4 (Sell), indicating expected underperformance in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is -$0.10 on revenues of $4.81 million, and for the current fiscal year, it is -$0.53 on revenues of $18.1 million [7] - The trend of estimate revisions for Intellinetics was unfavorable prior to the earnings release [6] Industry Context - The Internet - Content industry, to which Intellinetics belongs, is currently in the bottom 20% of the Zacks Industry Rank, suggesting potential challenges ahead [8]

Financial Data and Key Metrics Changes - Total revenue for Q2 2025 decreased by 13.6% to $4 million compared to $4.6 million in Q2 2024 [13] - SaaS revenue grew by 12.6% to $1.6 million from $1.4 million year-over-year, driven by early payables automation successes [13] - Professional services revenue decreased by 29% to $1.9 million from $2.7 million in the same period last year [14] - Net loss for Q2 was $568,000 compared to net income of $75,000 in Q2 2024, with loss per share at $0.13 [16] - Adjusted EBITDA was $28,000 compared to $698,000 for the same period in 2024 [17] Business Line Data and Key Metrics Changes - SaaS revenue, including hosting, showed growth of 12.6% [13] - Software maintenance services revenue decreased by 6.6% [14] - Professional services revenue constituted 49% of total revenue for the quarter, down from 56% last year [14] - Consolidated gross margin increased by 328 basis points to 68% [15] Market Data and Key Metrics Changes - Key vertical markets such as construction and homebuilding faced challenges due to higher interest rates and tariffs, leading to longer sales cycles [8] - K-12 education sector is experiencing concerns due to cuts in public education, affecting sales timelines [8] Company Strategy and Development Direction - The company aims to expand sales through various channels and has rebuilt its backlog of orders to historical levels [6] - Investments in sales and marketing are prioritized to enhance customer lifecycle management [9] - The company is committed to leveraging AI across three core pillars: new features, marketing and customer support, and internal development efficiencies [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about renewed customer activity and expects a strong fourth quarter [9] - The company anticipates SaaS revenue growth and positive adjusted EBITDA despite a projected decline in overall revenue for 2025 compared to 2024 [18] - Management believes in the strength of their competitive position and plans to reinvest cash flow into sales and development [39] Other Important Information - The company has successfully paid off $7.6 million in debt and earn-outs, positioning itself for growth investments [12] - The June 1 contract renewal with the largest customer includes price increases, which may improve margins [24] Q&A Session Summary Question: Should margins for professional services return to historic levels? - Management indicated that margins are expected to be a little better than historical levels due to the June 1 contract renewal [22][24] Question: How many customers in the homebuilder sector are live or paused? - Management reported that a high percentage of customers are live and moving aggressively towards go-live dates, with no dissatisfaction reported [26][27] Question: Expectations for SaaS growth moving forward? - Management acknowledged the 12.6% growth but expressed confidence in achieving better results, citing a strong pipeline and new product launches [28][29] Question: Progress in entering new verticals? - Management confirmed ongoing efforts to engage new partners and expand into new verticals, although progress has been slower than desired [34]

PART I FINANCIAL INFORMATION [Financial Statements](index=4&type=section&id=ITEM%201.%20Financial%20Statements.) Intellinetics' financial statements show decreased assets and liabilities, a widened net loss of $1.30 million, and a 9.7% revenue decline for H1 2025 [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to $17.16 million, liabilities fell to $5.59 million due to debt repayment, and equity rose to $11.56 million Condensed Consolidated Balance Sheet Highlights (in USD) | Account | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | **Total Current Assets** | $4,602,726 | $5,474,556 | ($871,830) | | Cash | $2,071,475 | $2,489,236 | ($417,761) | | **Total Assets** | **$17,158,385** | **$18,574,956** | **($1,416,571)** | | **Total Current Liabilities** | $4,678,795 | $6,597,773 | ($1,918,978) | | Notes payable - current | $0 | $1,297,448 | ($1,297,448) | | **Total Liabilities** | **$5,594,713** | **$7,943,201** | **($2,348,488)** | | **Total Stockholders' Equity** | **$11,563,672** | **$10,631,755** | **$931,917** | [Condensed Consolidated Statements of Operations](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q2 2025 saw a net loss of $567,590 on 13.6% lower revenues, while H1 2025 net loss widened to $1.30 million with a 9.7% revenue drop Three Months Ended June 30, Performance (in USD) | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Total Revenues | $4,010,813 | $4,641,593 | -13.6% | | Gross Profit | $2,726,557 | $3,002,979 | -9.2% | | (Loss) Income from Operations | ($508,478) | $172,106 | -395.4% | | Net (Loss) Income | ($567,590) | $75,050 | -856.3% | | Diluted EPS | ($0.13) | $0.02 | -750.0% | Six Months Ended June 30, Performance (in USD) | Metric | H1 2025 | H1 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Total Revenues | $8,258,158 | $9,148,677 | -9.7% | | Gross Profit | $5,595,757 | $5,902,623 | -5.2% | | (Loss) Income from Operations | ($1,193,037) | $137,626 | -966.9% | | Net (Loss) Income | ($1,295,155) | ($99,664) | -1200.0% | | Diluted EPS | ($0.31) | ($0.02) | -1450.0% | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) H1 2025 operating cash flow significantly decreased to $112,521, leading to an overall cash decrease of $417,761 Six Months Ended June 30, Cash Flow Summary (in USD) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $112,521 | $1,788,381 | | Net cash used in investing activities | ($471,904) | ($398,766) | | Net cash used in financing activities | ($58,378) | ($924,194) | | **Net (decrease) increase in cash** | **($417,761)** | **$465,421** | [Notes to Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail segment operations, accounting policies, significant customer concentration, and the full repayment of all outstanding notes payable - The company operates through two reporting segments: Document Management (software solutions) and Document Conversion (services to convert documents, primarily paper to digital)[24](index=24&type=chunk) - All outstanding notes payable to both unrelated and related parties were fully prepaid on June 18, 2025[64](index=64&type=chunk)[67](index=67&type=chunk) - The company has significant customer concentration risk, with the **State of Michigan accounting for 40% of total revenues** for the six months ended June 30, 2025, and 45% for the same period in 2024[83](index=83&type=chunk) Segment Revenue and Gross Profit (Six Months Ended June 30) | Segment | Revenue 2025 | Revenue 2024 | Gross Profit 2025 | Gross Profit 2024 | | :--- | :--- | :--- | :--- | :--- | | Document Management | $3,961,838 | $3,679,508 | $3,414,744 | $3,175,430 | | Document Conversion | $4,296,320 | $5,469,169 | $2,181,013 | $2,727,193 | | **Total** | **$8,258,158** | **$9,148,677** | **$5,595,757** | **$5,902,623** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=19&type=section&id=ITEM%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations.) Management discusses H1 2025 revenue decline due to customer volume and sales cycles, increased operating expenses, and debt repayment [Executive Overview of Results](index=25&type=section&id=Executive%20Overview%20of%20Results) H1 2025 revenues decreased 9.7% to $8.26 million, with SaaS growth offset by a $1.30 million net loss due to volume and sales cycle issues - Revenue decline was caused by a temporary volume reduction in the document conversion segment before a major contract renewal and longer sales lead times in the document management segment due to economic uncertainty[94](index=94&type=chunk) Key Financial Results for Six-Month Period 2025 | Metric | H1 2025 | YoY Change | | :--- | :--- | :--- | | Revenues | $8,258,158 | -9.7% | | SaaS Revenues | $3,119,273 | +11.2% | | Cost of Revenues | $2,662,401 | -18.0% | | Operating Expenses | $6,788,794 | +17.8% | | Loss from Operations | ($1,193,037) | N/A (vs. income of $137,626) | | Net Loss | ($1,295,155) | N/A (vs. loss of $99,664) | [Results of Operations](index=27&type=section&id=Results%20of%20Operations) H1 2025 revenues declined 9.7% due to professional services, offset by SaaS growth, while gross profit margin improved and operating expenses rose - **SaaS revenues increased by 11.2%** in H1 2025 compared to H1 2024, primarily due to new payables automation customers[102](index=102&type=chunk) - Professional services revenues decreased by **21.4%** in H1 2025, mainly from reduced scanning projects in the Document Conversion segment related to the timing of a contract renewal with its largest customer[103](index=103&type=chunk) - Overall gross profit percentage increased from **64.5% in H1 2024 to 67.8% in H1 2025**, attributed to a favorable revenue mix with a higher proportion of high-margin SaaS revenue[107](index=107&type=chunk) - Operating expenses rose due to investments in scaling, including expanded SOC2 processes, a larger development team, and an expanded sales team[112](index=112&type=chunk)[115](index=115&type=chunk) [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) The company holds $2.1 million in cash, fully repaid debt in June 2025, and believes current capital resources are sufficient for 12 months - The company had **$2.1 million in cash and cash equivalents** as of June 30, 2025[120](index=120&type=chunk) - All outstanding notes payable were repaid in full on June 18, 2025[122](index=122&type=chunk) - The company initiated an 'at-the-market' (ATM) offering program, with approximately **$8.2 million remaining available** as of the filing date[121](index=121&type=chunk) - Net cash provided by operating activities for H1 2025 was **$112,521**, a significant decrease from $1,788,381 in H1 2024[124](index=124&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=29&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk.) This section is not applicable as Intellinetics, Inc. is classified as a smaller reporting company - Not applicable to smaller reporting companies[129](index=129&type=chunk) [Controls and Procedures](index=29&type=section&id=ITEM%204.%20Controls%20and%20Procedures.) Management concluded the company's disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control - Management concluded that as of June 30, 2025, the company's disclosure controls and procedures were effective[131](index=131&type=chunk) - No changes occurred during the quarter that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[133](index=133&type=chunk) PART II OTHER INFORMATION [Legal Proceedings](index=30&type=section&id=ITEM%201.%20Legal%20Proceedings.) The company reported no legal proceedings during the period - None[136](index=136&type=chunk) [Risk Factors](index=30&type=section&id=ITEM%201A.%20Risk%20Factors.) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K - There have been no material changes to the risk factors from the Annual Report on Form 10-K for the fiscal year ended December 31, 2024[137](index=137&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=30&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds.) The company reported no unregistered sales of equity securities during the period - None[138](index=138&type=chunk) [Other Information](index=30&type=section&id=ITEM%205.%20Other%20Information.) No director or officer adopted, modified, or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the quarter - No director or officer adopted, modified, or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the quarter[141](index=141&type=chunk) [Exhibits](index=30&type=section&id=ITEM%206.%20Exhibits.) This section lists the exhibits filed with the Quarterly Report on Form 10-Q, including the At the Market Offering Agreement, the contract with the State of Michigan, and various officer certifications

[Executive Summary](index=1&type=section&id=Executive%20Summary) [2025 Second Quarter Highlights](index=1&type=section&id=2025%20Second%20Quarter%20Highlights) Intellinetics faced a total revenue decline in Q2 2025, primarily due to a significant reduction in professional services revenue, despite SaaS growth, reporting a net loss and a substantial decrease in Adjusted EBITDA, but successfully repaid all outstanding debt early 2025 Second Quarter Revenue Overview | Revenue Category | Q2 2025 | Q2 2024 | | :---------------------- | :------------- | :------------- | | Software as a service | $1,577,104 | $1,400,591 | | Software maintenance services | $330,459 | $353,966 | | Professional services | $1,899,619 | $2,677,291 | | Storage and retrieval services | $203,631 | $209,745 | | **Total Revenues** | **$4,010,813** | **$4,641,593** | - SaaS revenue increased by **12.6% year-over-year**[5](index=5&type=chunk) - Professional services revenue decreased by **29.0% year-over-year**[5](index=5&type=chunk) - Total revenues decreased by **13.6% year-over-year**[5](index=5&type=chunk) - Net loss of **$567,590** (or **$0.13 per share**), compared to net income of **$75,050** (or **$0.02 per share**) in Q2 2024[5](index=5&type=chunk) - Adjusted EBITDA was **$27,573**, down from **$698,217** in Q2 2024[5](index=5&type=chunk) - All outstanding notes were repaid early in June[5](index=5&type=chunk) - Cash balance at quarter-end was approximately **$2.1 million**[5](index=5&type=chunk) [CEO Commentary & Strategic Focus](index=1&type=section&id=CEO%20Commentary%20%26%20Strategic%20Focus) The CEO attributes the temporary decline in professional services revenue to contract timing, expecting production to normalize in Q3 with higher gross margins from new contracts, while focusing on SaaS growth through increased staffing and targeted sales, and enhancing financial flexibility by early debt repayment - Temporary decline in professional services revenue was due to the timing of contract renewals with the largest customer, now recovering[4](index=4&type=chunk) - Q3 production is returning to historical levels, with existing orders extending through **Q1 2026**[4](index=4&type=chunk) - Renewed contracts include price increases, expected to drive incremental gross margins in the second half of the year[4](index=4&type=chunk) - Company focuses on SaaS revenue growth, which increased by **12.6% year-over-year**, with increased staffing to drive further growth[5](index=5&type=chunk)[6](index=6&type=chunk) - Payables Automation solution is anticipated to be a key driver for SaaS growth[6](index=6&type=chunk) - All outstanding debt was repaid early in June, improving future cash flow and flexibility[5](index=5&type=chunk) [Financial Performance Overview](index=3&type=section&id=Financial%20Performance%20Overview) [Summary – 2025 Second Quarter Results](index=3&type=section&id=Summary%20%E2%80%93%202025%20Second%20Quarter%20Results) In Q2 2025, total revenue decreased by 13.6% year-over-year, primarily due to a 29.0% reduction in professional services revenue, despite a 12.6% increase in SaaS revenue, while operating expenses rose by 14.3% due to sales and marketing investments and IT enhancements, resulting in an operating loss and net loss - Total revenues were **$4,010,813**, a **13.6% year-over-year decrease**[7](index=7&type=chunk) - Professional services revenue decreased by **29.0%**, offsetting a **12.6% increase** in SaaS revenue[7](index=7&type=chunk) - Total operating expenses increased by **14.3%** to **$3,235,035**, driven by sales and marketing investments and IT/control environment enhancements[8](index=8&type=chunk) - Operating loss was **$508,478**, compared to operating income of **$172,106** in the prior year period[9](index=9&type=chunk) - Net loss was **$567,590** (or **$0.13 per share**), compared to net income of **$75,050** (or **$0.02 per share**) in the prior year period[9](index=9&type=chunk) - Adjusted EBITDA was **$27,573**, compared to **$698,217** in Q2 2024[9](index=9&type=chunk) [Summary – 2025 Year-to-Date Results](index=3&type=section&id=Summary%20%E2%80%93%202025%20Year-to-Date%20Results) For the six months ended June 30, 2025, total revenue decreased by 9.7% year-over-year, primarily due to a 21.4% decline in professional services revenue, while operating expenses increased by 17.8% due to growth investments and higher share-based compensation, leading to an expanded operating loss and significantly increased net loss - Total revenues were **$8,258,158**, a **9.7% year-over-year decrease**[10](index=10&type=chunk) - Professional services revenue decreased by **21.4%**, offsetting an **11.2% increase** in SaaS revenue[10](index=10&type=chunk) - Total operating expenses increased by **17.8%** to **$6,788,794**, primarily due to structural investments for growth and scale, and increased share-based compensation expense[10](index=10&type=chunk) - Operating loss was **$1,193,037**, compared to operating income of **$137,626** in the prior year period[10](index=10&type=chunk) - Net loss was **$1,295,155** (or **$0.31 per share**), compared to a net loss of **$99,664** (or **$0.02 per share**) in the prior year period[10](index=10&type=chunk) - Adjusted EBITDA was **$104,162**, compared to **$1,371,579** in 2024[10](index=10&type=chunk) [Financial Outlook](index=3&type=section&id=Financial%20Outlook) [2025 Outlook](index=3&type=section&id=2025%20Outlook) The company revised its 2025 guidance, expecting full-year revenue to be below 2024 due to Q1 professional services weakness, but still anticipates SaaS revenue growth and positive Adjusted EBITDA, albeit significantly reduced due to increased sales and marketing investments - Total revenues for **2025** are expected to be below **2024**, primarily due to professional services weakness in the first half of the year[11](index=11&type=chunk) - The company anticipates continued growth in SaaS revenue[11](index=11&type=chunk) - The company expects to maintain positive Adjusted EBITDA[11](index=11&type=chunk) - Adjusted EBITDA for **2025** is projected to be **more than 50% lower** than fiscal **2024**, due to increased investments in sales and marketing aimed at generating returns in late **2025** and beyond[11](index=11&type=chunk) [Company Information](index=3&type=section&id=Company%20Information) [About Intellinetics, Inc.](index=3&type=section&id=About%20Intellinetics%2C%20Inc.) Intellinetics, Inc. is a digital transformation solutions provider offering document and data management, storage, and protection services through its IntelliCloud content management platform for highly regulated markets, alongside business process outsourcing, scanning, and records storage services - Intellinetics, Inc. (NYSE American: INLX) is a digital transformation solutions provider[13](index=13&type=chunk) - Its flagship solution, the IntelliCloud content management platform, offers advanced security, compliance, workflow, and collaboration features[13](index=13&type=chunk) - The company also provides Business Process Outsourcing (BPO), document and microfilm scanning services, and records storage[13](index=13&type=chunk) - Serves highly regulated industries such as healthcare/human services providers, K-12 education, public safety, and state and local government[13](index=13&type=chunk) [Cautionary Statement](index=3&type=section&id=Cautionary%20Statement) This press release contains forward-looking statements regarding future business, growth, financial results, and strategy, which involve various risks and uncertainties such as economic changes, labor challenges, and reduced government funding; investors are cautioned not to place undue reliance on these statements, and the company disclaims any obligation to update or revise them - Statements in this press release regarding future business and growth, increased professional services output, improved gross margins, increased sales and marketing efforts, and future revenues (including the **2025** revenue and EBITDA outlook) are forward-looking statements[14](index=14&type=chunk) - Forward-looking statements involve risks and uncertainties, including changes in economic conditions, tariff uncertainties, challenges in recruiting and maintaining a stable workforce, reduced government funding for public education, ability to execute business plans, and market acceptance risks[15](index=15&type=chunk) - Intellinetics cautions investors not to place undue reliance on the forward-looking statements in this press release[15](index=15&type=chunk) - Intellinetics undertakes no obligation to update or revise any forward-looking statements in this press release[15](index=15&type=chunk) [Non-GAAP Financial Measures](index=5&type=section&id=Non-GAAP%20Financial%20Measures) [Adjusted EBITDA Definition and Reconciliation](index=5&type=section&id=Adjusted%20EBITDA%20Definition%20and%20Reconciliation) Intellinetics uses non-GAAP Adjusted EBITDA as a supplemental performance measure to provide a more comprehensive understanding of business trends, noting it is not GAAP compliant and should not replace net income or operating income, and provides a reconciliation to GAAP net (loss) income - Adjusted EBITDA is a non-GAAP supplemental performance measure used by the company, not compliant with U.S. Generally Accepted Accounting Principles (GAAP)[16](index=16&type=chunk) - It should not be considered a substitute for net income, operating income, or any other GAAP performance measure[17](index=17&type=chunk) - Adjusted EBITDA is defined as earnings before interest expense, income taxes, depreciation and amortization expense, the non-cash portion of share-based compensation, note conversions, and other specific transaction costs[18](index=18&type=chunk) Reconciliation of Net (Loss) Income to Adjusted EBITDA | | For the Three Months Ended June 30, | | For the Six Months Ended June 30, | | :---------------------------------- | :-------------------- | :-------------------- | :-------------------- | | | **2025** | **2024** | **2025** | **2024** | | Net (loss) income - GAAP | $(567,590) | $75,050 | $(1,295,155) | $(99,664) | | Interest expense, net | $59,112 | $97,056 | $102,118 | $237,290 | | Depreciation and amortization | $307,442 | $274,638 | $615,127 | $538,648 | | Share-based compensation | $228,609 | $251,473 | $682,072 | $695,305 | | **Adjusted EBITDA** | **$27,573** | **$698,217** | **$104,162** | **$1,371,579** | [Condensed Consolidated Financial Statements](index=6&type=section&id=Condensed%20Consolidated%20Financial%20Statements) [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section presents the unaudited condensed consolidated statements of operations for the three and six months ended June 30, 2025 and 2024, detailing revenues by service category, cost of revenues, gross profit, operating expenses, and net (loss) income Condensed Consolidated Statements of Operations Refer to page 6 of the original report for detailed condensed consolidated statements of operations, including revenues, costs, gross profit, operating expenses, and net (loss) income data for the three and six months ended June 30, 2025, and 2024 [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section presents the unaudited condensed consolidated balance sheets as of June 30, 2025, and December 31, 2024, detailing the company's assets, liabilities, and stockholders' equity Condensed Consolidated Balance Sheets Refer to page 7 of the original report for detailed condensed consolidated balance sheets, including assets, liabilities, and stockholders' equity data as of June 30, 2025, and December 31, 2024 [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section presents the unaudited condensed consolidated statements of cash flows for the six months ended June 30, 2025 and 2024, detailing cash flows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows Refer to page 8 of the original report for detailed condensed consolidated statements of cash flows, including cash flow data from operating, investing, and financing activities for the six months ended June 30, 2025, and 2024