Acquisition and Market Impact - Giftify acquired CardCash for $26,682,000, consisting of 6,108,007 shares valued at $4.00 per share, $750,000 in cash, and $1,500,000 in notes payable[19]. - CardCash's operations are projected to contribute significantly to the gift card market, expected to reach $400 billion by 2026[26]. - CardCash has saved consumers over $100 million since its inception through its gift card exchange platform[24]. - CardCash's branded exchange partnerships with CVS and Amazon generated revenues of $1,800,000 and $1,900,000 respectively in 2023[31]. - The acquisition of Takeout7 Inc. on May 29, 2025, expanded the company's technology offerings for independent restaurants[187]. Financial Performance - For the fiscal year ended December 31, 2025, the company recorded a net loss of $10,491,658 and used cash in operating activities of $1,590,074[75]. - The company realized net income of $830,197 for the year ended December 31, 2025[76]. - For the fiscal year ended December 31, 2025, net sales reported were $83,181,716, a decrease of 6.5% from $88,934,036 in 2024[202]. - Gross billings for the same period were $154,707,400, reflecting a 27.1% increase from $121,689,314 in 2024[202]. - Gross revenue from principal transactions for the year ended December 31, 2025, was $78,264,149, a decrease from $86,758,876 in 2024[213]. - Net revenue from agent transactions increased by $2,742,407, or 126.1%, to $4,917,567 in 2025 compared to $2,175,160 in 2024[213]. - A significant portion of revenue is derived from discounted merchant gift card sales, where gross billings differ from net sales due to retained fees and commissions[214]. Operational Insights - CardCash's gross margin is currently 16.8%, with an anticipated increase of approximately 8% over the next two years due to improved inventory sourcing and retail sales[30]. - The B2C division of Restaurant.com accounted for approximately 15% of gross revenue for the fiscal year ended December 31, 2025[34]. - Restaurant.com's B2B division generated approximately 85% of gross revenue for the fiscal year ended December 31, 2025[36]. - The average order value for bundled offerings ("Specials") from Restaurant.com is nearly five times that of standard certificate purchases[35]. - As of December 31, 2025, the company had a customer base of 5.4 million and featured deals at over 184,000 restaurants and merchants[58]. Challenges and Risks - There is substantial doubt regarding the company's ability to continue as a going concern for at least 12 months beyond the filing of the Annual Report[75]. - The company faces competition from larger, established companies with greater resources and customer bases, which may impact its market position[59]. - The company is subject to various foreign and domestic laws and regulations that could adversely affect its business operations[60]. - The implementation of the CARD Act and similar state laws may classify the company’s discount certificates as gift cards, potentially increasing liabilities related to unredeemed certificates and adversely affecting net income[80]. - The company’s total customer count may be inflated due to multiple registrations and inactive accounts, making it difficult to accurately assess the number of active customers[89]. - The business is subject to seasonal sales fluctuations, which could lead to volatility in working capital cash flow and affect the market price of its common stock[90]. - The company faces risks associated with internet regulations and compliance, which could impede growth and affect revenue if not adhered to[82]. - Fraudulent transactions and counterfeit certificates pose significant risks, potentially leading to substantial losses and affecting the company’s ability to accept credit card payments[95]. - The evolving landscape of privacy laws and regulations could lead to liabilities and affect customer trust if compliance is not maintained[83]. - The company is subject to payments-related risks, including potential increases in interchange fees that could reduce profitability[96]. - Current economic uncertainty, particularly due to geopolitical conflicts, may adversely affect revenue and business operations[100]. - Global inflation has increased operating costs, particularly in employee wages, which could negatively impact financial results[102]. - Future capital raising may be limited, potentially hindering growth and response to competitive pressures[103]. - The company faces risks from changes in search engine algorithms that could negatively impact website traffic and operating results[120]. Employee and Corporate Structure - The company employs 40 full-time employees as of December 31, 2025, and considers its employee relations to be good[73]. - The company is classified as a "smaller reporting company" with a public float of less than $250 million, allowing for simplified disclosures in SEC filings[74]. - The company has 825 holders of record of its common stock as of December 31, 2025[176]. - Approximately 20% of the outstanding shares of common stock are beneficially owned by insiders, which may adversely affect the price of the common stock and limit stockholder influence[153]. Marketing and Customer Engagement - CardCash intends to increase its marketing efforts to accelerate gift card sales and enhance customer engagement[30]. - The company plans to significantly increase its marketing and branding expenditures, which may adversely affect its financial results[117]. - Attracting and retaining customers on cost-effective terms is critical for future revenue growth[109]. - The reliance on email marketing is critical, and any restrictions on email delivery could materially harm the business[118]. Cybersecurity and Technology - The company has implemented a cybersecurity risk management program to identify, assess, and mitigate risks from cybersecurity threats, integrating it into overall risk management processes[160]. - The company has not experienced material adverse effects from cybersecurity threats to date, but has faced threats and breaches of data and systems[163]. - CardCash's technology, FraudFix, ensures transaction security and integrity, contributing to its competitive advantage in the market[24]. - The company's advanced fraud-prevention technology, FraudFix, has contributed to saving consumers over $100 million since inception[193]. Real Estate and Facilities - The principal executive offices are located in Schaumburg, IL, covering approximately 7,850 square feet, with a lease executed in April 2023 for a 36-month term at an average base rent of approximately $7,500 per month[167]. - CardCash signed a lease in April 2024 for its office in Woodbridge, NJ, with a term of 61 months through April 2029, and an average base rent of approximately $28,000 per month[168]. Stock and Market Activity - The company's common stock is now trading on the Nasdaq Marketplace, but there is limited trading activity and no assurance that an active market will develop in the future[146]. - The trading price of the common stock may fluctuate significantly due to various factors, including operating results and market conditions[155]. - The company is classified as a "smaller reporting company," which may make it more challenging for investors to analyze its results of operations and financial prospects[155].

Financial Performance - The company reported net sales of $18,783,908 for the three months ended September 30, 2025, a decrease of 19.1% compared to $23,210,850 in the same period of 2024[158]. - Net sales for the nine months ended September 30, 2025, were $61,961,652, a decrease of 4.3% from $64,753,246 in 2024[192]. - The net loss for the three months ended September 30, 2025, was $2,437,462, a significant improvement from a net loss of $4,061,152 in 2024[182]. - For the nine months ended September 30, 2025, the company incurred a net loss of $8,244,603, a decrease from a net loss of $14,996,518 for the same period in 2024, reflecting improved gross profit and reduced expenses[201]. - The company reported a Modified EBITDA of $(1,048,967) for the nine months ended September 30, 2025, compared to $(1,684,289) for the same period in 2024, indicating a reduction in operational losses[204]. Revenue and Billing - Gross billings increased by 28.8% to $39,086,540 for the three months ended September 30, 2025, compared to $30,341,126 in the prior year[170]. - Gross billings for the nine months ended September 30, 2025, were $111,178,068, an increase of 23.8% from $89,795,695 in the same period of 2024[158]. - The company experienced a significant increase in net revenue recognized as an agent, which rose by $873,157, or 191%, during the three months ended September 30, 2025, compared to the previous year[169]. Operating Expenses - Operating expenses decreased to $6,235,209 for the three months ended September 30, 2025, from $6,770,812 in 2024, primarily due to a reduction in stock-based compensation[175]. - Selling, general and administrative expenses for the nine months ended September 30, 2025, were $17,247,499, down from $20,954,914 in 2024, a decrease of $3,707,415[195]. - The total operating expenses for the nine months ended September 30, 2025, were $19,417,659, down from $23,714,431 in 2024[194]. - Amortization of capitalized software costs decreased to $483,832 for the nine months ended September 30, 2025, from $935,766 in 2024[196]. - Amortization expenses for intangible assets were $1,686,328 for the nine months ended September 30, 2025, compared to $1,823,751 for the same period in 2024[198]. Cash Flow and Liquidity - The company reported cash of $4,021,227 available for operations as of September 30, 2025, with a negative working capital of $1,537,994[160]. - Cash used in operating activities was $496,067 for the nine months ended September 30, 2025, significantly improved from $2,858,368 in the same period of 2024[214]. - As of September 30, 2025, the company had a cash balance of $4,021,227, which is expected to last until March 31, 2026[209]. Business Developments - The acquisition of Takeout7, Inc. on May 29, 2025, expanded the company's technology offerings to include end-to-end solutions for independent restaurants[142]. - The merger with CardCash Exchange Inc. was completed on December 29, 2023, enhancing the company's position in the gift card exchange market[143]. - The company has a customer database of 6.2 million, which is leveraged for various services and products[154]. Concerns and Risks - The company has faced operating losses and negative cash flows during 2024 and 2023, raising substantial doubt about its ability to continue as a going concern[162]. - The company is evaluating repayment options for a note payable principal balance of $1,750,000 due in December 2025, which may include private stock issuance and utilizing existing cash[206]. - The company has substantial doubt about its ability to continue as a going concern, as indicated by its negative working capital of $1,537,994 as of September 30, 2025[223]. - The company has been impacted by inflationary pressures, which may affect its operating costs and financial performance[159]. - The company experienced a decrease in stock-based compensation expense, which contributed to the reduction in net loss[201].

Financial Performance - Gross billings for the three months ended June 30, 2025, were $36,072,063, representing a 23.2% increase compared to $29,287,369 in the same period of 2024[152]. - Net sales for the three months ended June 30, 2025, were $20,900,731, up from $20,020,502 in 2024, indicating growth in revenue[168]. - The company reported a gross profit of $3,855,625 for the three months ended June 30, 2025, compared to $3,260,495 in 2024[168]. - The net loss for the three months ended June 30, 2025, was $2,589,809, a decrease from a net loss of $7,744,646 in the same period of 2024[168]. - Gross billings for the six months ended June 30, 2025, were $73,091,528, representing a 23.2% increase from $59,319,954 in 2024[183]. - Net sales for the six months ended June 30, 2025, were $43,177,744, an increase of 3.9% from $41,542,396 in 2024[186]. - Gross profit for the six months ended June 30, 2025, increased by $919,490, or 14.1%, with a gross margin of 17.2% compared to 15.7% in 2024[187]. - The net loss for the six months ended June 30, 2025, was $5,807,141, down from $10,935,366 in 2024, attributed to increased gross profit and decreased expenses[196]. - Modified EBITDA for the three months ended June 30, 2025, was $(150,236), an improvement from $(357,130) in 2024[182]. - For the six months ended June 30, 2025, the company reported a net loss of $5,807,141, an improvement from a net loss of $10,935,366 for the same period in 2024[199]. - Modified EBITDA for the six months ended June 30, 2025 was $(776,557), compared to $(1,015,119) for the same period in 2024, reflecting a reduction in losses[199]. Operational Challenges - The company experienced operating losses and negative cash flows during 2024 and 2023, raising concerns about its ability to continue as a going concern[156]. - Cash available to fund operations as of June 30, 2025, was $3,257,427, with a negative working capital of $1,710,474[154]. - The company had cash of $3,257,427 available as of June 30, 2025, with a negative working capital of $1,710,474, raising concerns about its ability to continue as a going concern[209]. - The company anticipates its cash balance will last until December 2025, indicating potential liquidity challenges ahead[209]. - The company is dependent on its ability to raise additional debt or equity capital to fund its business activities and achieve sustainable revenues[210]. Cost Management - Operating expenses for the three months ended June 30, 2025, were $6,433,149, down from $10,742,924 in 2024, primarily due to a decrease in stock-based compensation[172]. - The loss from operations for the three months ended June 30, 2025, was $2,577,524, significantly reduced from a loss of $7,482,429 in 2024[176]. Strategic Developments - The acquisition of Takeout7, Inc. on May 29, 2025, expanded the company's technology offerings to include comprehensive online ordering solutions for independent restaurants[136]. - The merger with CardCash Exchange Inc. was completed on December 29, 2023, enhancing the company's position in the gift card exchange market[137]. - The company has a customer database of 6.2 million, which is leveraged for various services and products, indicating strong market potential[148]. Cash Flow - Cash provided by operating activities for the six months ended June 30, 2025 was $289,951, a significant recovery from cash used of $(3,074,200) in the same period of 2024[214][216]. - Cash used in financing activities for the six months ended June 30, 2025 was $(1,443,909), primarily due to repayments of lines of credit and notes payable[219]. - The company has a revolving line of credit of up to $10,000,000, with an average interest rate of 12% as of June 30, 2025[221]. Revenue Recognition - The company recognized revenue in accordance with FASB ASC 606, primarily from the sale of merchant gift cards and discount certificates[201]. - The increase in net revenue recognized as an agent increased by $462,637, or 73%, during the three months ended June 30, 2025, compared to the prior year[163]. - Net sales for the three months ended June 30, 2025, were $20,900,731, an increase of 4.4% compared to $20,020,502 for the same period in 2024[169]. - Gross profit for the three months ended June 30, 2025, increased by $595,130, or 18.3%, with a gross margin of 18.4% compared to 16.3% in 2024[170]. Historical Performance - The company has a history of reporting net losses and has financed its working capital through borrowings and equity sales[208].

Financial Performance - For the three months ended March 31, 2025, net sales were $22,277,013, an increase of 3.5% from $21,521,894 in the same period of 2024[145]. - CardCash's net sales for the three months ended March 31, 2025, were $21,867,114, up from $21,160,007 in 2024, reflecting a focus on improving gross margin[146]. - Gross profit for the three months ended March 31, 2025, was $3,581,636, compared to $3,257,276 in 2024, marking an increase of 9.9%[145]. - The gross margin for CardCash improved to 14.7% in Q1 2025 from 13.8% in Q1 2024, contributing to a gross profit increase of $285,850[149]. Operating Expenses - Operating expenses for the three months ended March 31, 2025, totaled $6,749,301, an increase from $6,200,695 in the same period of 2024[151]. - Selling, general and administrative expenses rose to $6,043,841 in Q1 2025, up by $829,800 from $5,214,041 in Q1 2024, driven by increased stock-based compensation and payroll expenses[152]. Net Loss - The company reported a net loss of $3,217,332 for the three months ended March 31, 2025, compared to a net loss of $3,190,720 in the same period of 2024[145]. - The company reported a net loss of $3,217,332 for the three months ended March 31, 2025, compared to a net loss of $3,190,720 for the same period in 2024, indicating a slight increase in net loss[158]. Cash Flow and Liquidity - The company had cash of $2,121,814 available to fund operations as of March 31, 2025, with a negative working capital of $2,075,999[138]. - Cash used in operating activities for the three months ended March 31, 2025, was approximately $1,448,924, a significant increase from $6,636 in the same period of 2024[178]. - The company anticipates its cash balance will last until approximately December 2025, raising substantial doubt about its ability to continue as a going concern[171]. Debt and Financing - Interest expense decreased to $209,571 in Q1 2025 from $247,301 in Q1 2024, attributed to reduced debt balances[156]. - The company entered into a secured promissory note with Real World Digital Assets LLC for $1,000,000 at an annual interest rate of 11.5%, maturing on December 31, 2025[186]. - As of March 31, 2025, the company had an outstanding principal balance of $750,000 on promissory notes related to the acquisition of CardCash, with accrued interest payable of $84,375[185]. - The company has a revolving line of credit with availability of up to $10,000,000, with an average interest rate of 12% as of March 31, 2025[183]. - The Company received a total of $650,000 in proceeds from the Covid-19 Economic Injury Disaster Loan (EIDL) Program, with amounts of $150,000 on June 17, 2020, $350,000 on July 14, 2021, and another $150,000 on July 21, 2020[187][188]. - The loans bear an interest rate of 3.75% per annum, with a combined repayment of principal and interest of $3,500 per month starting 12 months from the date of the promissory note over a period of 30 years[188]. - As of December 31, 2024, the note payable had a principal balance outstanding of $664,500 and accrued interest payable of $15,558[188]. - As of March 31, 2025, the note payable remained at a principal balance of $664,500, with accrued interest payable reduced to $8,638[189]. Off-Balance Sheet Arrangements - The Company did not have any off-balance sheet arrangements as of March 31, 2025, and December 31, 2024[190]. Regulatory Classification - The Company is classified as a smaller reporting company and is not required to provide certain market risk disclosures[191].

Acquisition and Business Expansion - Giftify, Inc. acquired CardCash Exchange, Inc. for $26,682,000, consisting of 6,108,007 shares of common stock valued at $24,432,000, $750,000 in cash, and $1,500,000 in notes payable[19] - The company completed the merger with CardCash Exchange Inc on December 29, 2023, which has been accounted for as a business combination[188] - The company intends to pursue acquisitions to support growth, but integration challenges and potential dilution of equity could adversely affect operations[105] - Future operational strategies will likely focus on integrating CardCash's operations and enhancing profitability through improved sales and marketing efforts[209] Financial Performance - For the year ended December 31, 2024, net sales were $88,934,036, a significant increase from $484,860 in the prior year[211] - Gross profit for the year ended December 31, 2024, was $13,144,781, compared to $66,510 for the Predecessor period, reflecting improved operational efficiency[211] - The net loss for the year ended December 31, 2024, was $18,832,080, compared to a net loss of $5,020,000 in the previous year[211] - CardCash sales for the year ended December 31, 2024, were $86,991,638, slightly down from $87,146,804 in 2023, indicating stable performance despite market challenges[214] - The Company incurred interest expenses of $1,002,354 in 2024, compared to $2,890,466 in the previous year, reflecting a reduction in financing costs[211] - The Company reported a gain on forgiveness of debt amounting to $5,876,000 in the Predecessor period, which positively impacted prior year results[211] Market and Growth Potential - The global gift card market is projected to reach $400 billion by 2026, with CardCash planning to expand its four business channels to capitalize on this growth[27] - CardCash has saved consumers over $100 million since its inception through its gift card exchange platform[24] - The average order value for bundled offerings ("Specials") from Restaurant.com is nearly five times that of standard certificate purchases, generating over 5% of B2C revenue from 60% of orders[37] - Restaurant.com connects over 182,500 restaurants and retailers to 7.8 million customers, generating significant revenue through discount certificates[195] Operational Challenges and Risks - The company faces substantial doubt about its ability to continue as a going concern due to recurring losses from operations[76] - The company anticipates competition from larger, more established companies with greater financial and technical resources[60] - The company is subject to evolving foreign and domestic laws and regulations that could adversely affect its business[61] - The company faces risks related to payment processing services, including potential disruptions if third-party providers are unable to deliver services[96] - The company may incur significant losses from fraud and counterfeit certificates, which could adversely affect revenue if credit card acceptance is lost[95] - Current economic uncertainty, including the impact of the COVID-19 pandemic, may hinder revenue growth and lead to decreased spending by customers[101] Marketing and Customer Acquisition - CardCash plans to increase marketing efforts to retailers and consumers to accelerate gift card sales[35] - The ability to attract and retain customers on cost-effective terms is critical for future revenue growth and profitability[110] - The company plans to increase marketing and branding expenditures significantly, which may adversely impact financial results if not effective[120] - Retaining and acquiring customers is crucial for profitability, with recent declines in website and mobile application traffic raising concerns[139] Regulatory and Compliance Issues - The company is subject to various regulations related to payments and anti-money laundering, which could increase compliance costs and impact operations[98] - The implementation of the CARD Act may classify discount certificates as gift cards, potentially increasing liabilities related to unredeemed certificates[81] - The company may incur unexpected expenses related to compliance with expanding tax regulations, which could affect financial stability[129] Cybersecurity and Technology - Cybersecurity risks are significant, with potential breaches leading to legal and financial repercussions, which could adversely affect financial results[114] - The company has implemented a cybersecurity risk management program to protect customer and operational data from threats[160] - The cybersecurity strategy includes regular assessments, vulnerability management, and employee training to mitigate risks[161] - The reliance on third-party technology licenses may result in delays if not maintained on favorable terms, impacting software development[127] Employee and Operational Structure - The company employs 42 full-time employees, with no representation by a labor union[74] - Insiders control approximately 20% of the company's outstanding shares, which may affect stockholder influence and stock price[154] - The company is classified as a "smaller reporting company," allowing for simplified disclosures in SEC filings[75]

Financial Performance - For the three months ended September 30, 2024, net sales were $23,210,850, an increase of approximately $3,003,331, or 14.9%, compared to $20,207,519 for the same period in 2023[130]. - The gross margin for the three months ended September 30, 2024, was 12.9%, slightly up from 12.8% in the prior year period[130]. - Cost of sales increased to $20,220,237 for the three months ended September 30, 2024, compared to $17,629,985 for the same period in 2023, with cost of sales as a percentage of sales at 87.1%[132]. - Selling, general and administrative expenses rose to $5,908,603 for the three months ended September 30, 2024, an increase of $3,308,447 from $2,600,156 in the prior year[134]. - The company incurred a loss from operations of $3,780,199 for the three months ended September 30, 2024, compared to a loss of $365,607 for the same period in 2023[137]. - The net loss for the three months ended September 30, 2024, was $4,061,152, compared to a net loss of $556,582 for the same period in 2023[139]. - For the nine months ended September 30, 2024, net sales were $64,753,246, a decrease of approximately $707,658, or 1.1%, from $65,460,904 in the same period in 2023, despite an increase in gross margin from 12.4% to 14.7%[144]. - The company incurred a loss from operations of $14,206,047 for the nine months ended September 30, 2024, compared to a loss of $1,158,731 for the same period in 2023[153]. - The net loss for the nine months ended September 30, 2024, was $14,996,518, compared to a net loss of $1,673,617 for the same period in 2023[156]. - Modified EBITDA for the nine months ended September 30, 2024, was $(1,684,289), compared to $(129,775) for the same period in 2023[159]. Expenses and Costs - Cost of sales decreased to $55,244,862 for the nine months ended September 30, 2024, compared to $57,352,182 in the prior year, resulting in a cost of sales percentage of 85.3% versus 87.6%[146]. - Selling, general and administrative expenses rose to $20,954,914 for the nine months ended September 30, 2024, an increase of $12,716,417 from $8,238,497 in the same period in 2023, primarily due to stock-based compensation[150]. - Other expenses amounted to $280,953 for the three months ended September 30, 2024, compared to $191,326 for the same period in 2023[138]. - Stock-based compensation expense recorded during the nine months ended September 30, 2024, was $9,762,242, significantly impacting overall expenses[150]. Cash Flow and Financing - The company has a working capital deficit of $2,182,182 as of September 30, 2024, with cash available for operations at $3,090,980[123]. - Cash used in operating activities for the nine months ended September 30, 2024 was approximately $2,362,948, compared to $220,267 for the same period in 2023[176][178]. - Cash used for investing activities for the nine months ended September 30, 2024 was $674,646, similar to $675,000 for the same period in 2023[180]. - Cash provided by financing activities for the nine months ended September 30, 2024 was $2,028,837, significantly higher than $634,926 for the same period in 2023[181][182]. - The outstanding line of credit balance at September 30, 2024 was $4,234,149, down from $6,737,385 at December 31, 2023[183]. - The company entered into an At-the-Market Issuance Sales Agreement to sell shares of common stock with an aggregate offering price of up to $30,000,000[171]. - The company has a remaining convertible note payable of $20,000, with accrued interest of $22,238, convertible at $1.50 per share[184]. - The company issued two-year promissory notes totaling $1,500,000 as partial consideration for the acquisition of CardCash, with an aggregate principal balance outstanding of $1,500,000 as of September 30, 2024[186]. - The company received a total of $150,000 and $350,000 from the SBA under the Covid-19 Economic Injury Disaster Loan (EIDL) Program, with a principal balance outstanding of $664,500 as of September 30, 2024[190]. - The company anticipates its cash balance will last until at least June 2025, but faces uncertainty in securing additional financing[172][173]. Acquisition and Business Operations - The acquisition of CardCash Exchange, Inc. was completed for a total consideration of $26,682,000, including 6,108,007 shares of common stock valued at $24,432,000[109]. - The B2C division accounted for 45% of gross revenue, while the B2B division accounted for 55% for the fiscal year ended December 31, 2023[117][119]. - The company focuses on improving gross margin by assessing the quality of purchased gift card brands, which has allowed for increased sales prices to customers[144]. - The company expects selling, general and administrative expenses to increase in future periods due to the addition of personnel and higher operational costs associated with being a public company[149]. - As of September 30, 2024, the company had cash of $3,090,980 and a working capital deficit of $2,182,182, raising substantial doubt about its ability to continue as a going concern[170].

Financial Performance - For the three months ended June 30, 2024, net sales were $20,020,502, a decrease of approximately $1,071,155, or 5.1%, compared to $21,091,657 for the same period in 2023[128]. - Gross margin improved to 16.3% for the three months ended June 30, 2024, up from 12.4% in the prior year period, despite a decrease in sales[128]. - The company reported a net loss of $7,744,646 for the three months ended June 30, 2024, compared to a net loss of $686,657 for the same period in 2023, reflecting an increase in net loss due to higher operating costs and stock-based compensation[137]. - For the six months ended June 30, 2024, net sales were $41,542,396, a decrease of approximately $3,710,989, or 8.2%, from $45,253,385 in the same period in 2023, despite an increase in gross margin from 12.2% to 15.7%[141]. - The net loss for the six months ended June 30, 2024, was $10,935,366, compared to a net loss of $1,117,035 for the same period in 2023[150]. Expenses - Selling, general and administrative expenses increased to $9,832,270 for the three months ended June 30, 2024, from $2,835,513 in the prior year, primarily due to $6,214,545 in stock-based compensation expense[132]. - Selling, general and administrative expenses increased to $15,046,311 for the six months ended June 30, 2024, compared to $5,638,341 in the same period in 2023, primarily due to stock-based compensation and legal fees related to acquisitions[145]. - Other expenses amounted to $261,917 for the three months ended June 30, 2024, compared to $170,414 in the prior year, primarily consisting of interest expenses[136]. - Other expenses amounted to $509,518 for the six months ended June 30, 2024, compared to $352,308 in the prior year, primarily due to increased interest expenses[149]. Operational Losses - Loss from operations for the three months ended June 30, 2024, was $7,482,429, compared to a loss of $516,243 for the same period in 2023[135]. - The company incurred a loss from operations of $10,425,848 for the six months ended June 30, 2024, compared to a loss of $793,124 for the same period in 2023[148]. Cash Flow and Financing - Cash used in operating activities for the six months ended June 30, 2024 was approximately $2,341,031, compared to $437,725 for the same period in 2023, reflecting increased operational losses[169][170]. - Cash provided by financing activities for the six months ended June 30, 2024 was $3,354,563, significantly higher than $343,742 in the prior year, primarily from the private sale of common stock[173]. - The outstanding line of credit balance increased to $7,670,449 as of June 30, 2024, up from $6,737,385 at the end of 2023, with an average interest rate of 12%[174]. - The company has a history of reporting net losses and has financed its working capital through borrowings and equity sales[162][164]. - The company anticipates its cash balance will last until at least June 2025, but faces uncertainty in securing additional financing[163][165]. Working Capital and Going Concern - The company reported a working capital deficit of $1,133,903 as of June 30, 2024, raising concerns about its ability to continue as a going concern[121]. - As of June 30, 2024, the company reported cash of $4,663,623 and a working capital deficit of $1,037,619, indicating substantial doubt about its ability to continue as a going concern[163]. - The company’s ability to continue operations is contingent upon raising additional debt or equity capital to achieve sustainable revenues and profitability[164]. Acquisitions and Revenue Recognition - The acquisition of CardCash Exchange, Inc. was completed for a total consideration of $26,682,000, including 6,108,007 shares of common stock valued at $24,432,000[108]. - The company recognized revenue in accordance with FASB ASC 606, primarily from the sale of merchant gift cards and discount certificates[156]. Customer Base - Restaurant.com serves over 7.8 million customers and connects them with over 182,500 restaurants and retailers nationwide[114]. - The B2C division accounted for 45% of gross revenue, while the B2B division accounted for 55% for the fiscal year ended December 31, 2023[115].

Financial Performance - For the three months ended March 31, 2024, net sales were $21,521,894, a decrease of approximately $2,639,834, or 10.9%, compared to $24,161,728 in the same period of 2023[126]. - The gross margin for the current year period improved to 15.1%, up from 12.1% in the prior year period, despite a decrease in sales[126]. - Operating expenses increased to $5,214,041 for the three months ended March 31, 2024, compared to $2,802,828 for the same period in 2023, reflecting an increase of $2,411,213[131]. - The loss from operations for the three months ended March 31, 2024, was $2,943,419, significantly higher than the loss of $276,881 for the same period in 2023[134]. - The company reported a net loss of $3,190,720 for the three months ended March 31, 2024, compared to a net loss of $430,378 for the same period in 2023, indicating an increase in net loss of approximately 642%[137]. - Modified EBITDA for the three months ended March 31, 2024, was $(657,439), a decrease from Modified EBITDA of $110,822 for the same period in 2023, reflecting a significant decline in operational performance[140]. Cash Flow and Working Capital - The company reported a working capital deficit of $228,112 as of March 31, 2024, with cash available for operations at $5,400,821[119]. - Cash used in operating activities for the three months ended March 31, 2024, was approximately $6,636, a stark contrast to cash provided by operating activities of $803,483 for the same period in 2023[154][156]. - Cash used for investing activities increased to $224,815 for the three months ended March 31, 2024, compared to $38,449 for the same period in 2023, indicating a rise in capital expenditures[158]. - Cash provided by financing activities was $1,532,535 for the three months ended March 31, 2024, primarily from proceeds of $2,709,000 on the private sale of common stock, after accounting for repayments[159]. - The company had cash of $5,400,821 available to fund operations as of March 31, 2024, with a working capital deficit of $228,112, raising concerns about its ability to continue as a going concern[149]. - The company anticipates its cash balance will last until at least March 2025, but there is substantial doubt about its ability to continue as a going concern without raising additional capital[149][150]. Debt and Financing - The outstanding line of credit balance was $6,060,920 as of March 31, 2024, down from $6,737,385 at December 31, 2023, reflecting ongoing debt management efforts[160]. - The company issued two-year promissory notes totaling $1,500,000 as partial consideration for the acquisition of CardCash, with specific repayment terms outlined[162]. - The company has a history of reporting net losses and has financed its working capital requirements through borrowings and equity sales, indicating reliance on external funding sources[148]. Business Operations - The B2C division accounted for 45% of gross revenue, while the B2B division accounted for 55% for the fiscal year ended December 31, 2023[113][115]. - Restaurant.com serves over 182,500 restaurants and retailers, connecting with over 7.8 million customers[112]. - The acquisition of CardCash Exchange, Inc. was completed for a total consideration of $26,682,000, including 6,108,007 shares of common stock valued at $24,432,000[106]. Going Concern - Management has expressed substantial doubt about the company's ability to continue as a going concern due to a history of net losses and negative operating cash flows[121].

Acquisition and Financial Overview - RDE, Inc. acquired CardCash Exchange, Inc. for a total consideration of $26,682,000, which included 6,108,007 shares of common stock valued at $24,432,000, $750,000 in cash, and $1,500,000 in notes payable[19]. - The company completed the acquisition of CardCash Exchange, Inc. for $26,682,000, consisting of 6,108,007 shares of common stock valued at $24,432,000, $750,000 in cash, and $1,500,000 in notes payable[202]. - For the year ended December 31, 2023, the company recorded a loss from operations of $8,100,406 and used cash in operating activities of $541,791[83]. - The company has a history of net operating losses, with losses of $3,080,406 and $5,600,348 for the years ended December 31, 2023 and 2022, respectively[85]. - The outstanding balance on the company's line of credit facility was $6,737,385, with $2,294,779 in promissory notes and $40,137 in past due convertible notes payable[83]. - The company has not declared or paid any cash dividends on its common stock and intends to retain future earnings to finance business expansion[192]. Revenue and Market Performance - The B2C division of Restaurant.com accounted for 45% of gross revenue in the fiscal year ended December 31, 2023, while the B2B division accounted for 55%[37]. - Revenue improved in fiscal 2023 as the impact of COVID-19 abated, following declines in 2020, 2021, and 2022 due to restaurant closures[213]. - CardCash's gross margin is currently 13.3%, with the retail-to-bulk channel having the highest margin at approximately 17% and bulk-to-bulk at about 10%[36]. - CardCash expects to achieve a gross margin of 15% in 2023 and 19% in 2024, anticipating an 8% increase in gross margins over the next two years[36]. - The global gift card market is projected to reach $1.4 trillion by 2026, which CardCash aims to capitalize on by expanding its business channels[28]. Customer Base and Marketing - As of December 31, 2023, the company had a customer base of 6.2 million and featured deals at over 184,000 restaurants and merchants[61]. - CardCash spent only $807,031 on marketing in 2023, representing 0.9% of its gross revenues, and plans to increase marketing efforts to accelerate sales[35]. - The average order value for bundled offerings ("Specials") from Restaurant.com is nearly five times that of standard certificate purchases, generating over 5% of B2C revenue from 60% of orders[38]. - The B2B division contributed 55% of gross revenue in fiscal year 2023, selling certificates and Discount Dining Passes to corporations[211]. - Restaurant.com serves over 182,500 restaurants and retailers, connecting with 7.8 million customers nationwide[208]. Competition and Market Challenges - The company faces competition from larger, established companies with greater financial and technical resources, which may impact its revenue base[59]. - The company faces intense competition in the market for discounts, which may lead to reduced operating margins and loss of market share[129]. - The company’s operating results are affected by its reliance on search engines for traffic, and changes in algorithms could negatively impact visibility and sales[135]. - The company is dependent on the growth of online commerce, with concerns about fraud and privacy potentially hindering customer acquisition[105]. - Economic uncertainty, including the impact of the COVID-19 pandemic, could adversely affect revenue and business operations[113]. Regulatory and Legal Risks - The company is subject to various foreign and domestic laws affecting online business, which could harm its operations[63]. - The company is not currently considered a financial institution under anti-money laundering laws, but proposed amendments could change this status[69]. - The company may incur significant costs related to legal claims, including defamation and copyright infringement, which could materially impact its net income[99]. - The company is subject to evolving internet and e-commerce regulations, which could adversely affect its business operations and revenue growth[97]. - Failure to comply with privacy laws and regulations could result in significant liabilities and adversely affect the company's business[98]. Internal Controls and Governance - The company has identified material weaknesses in its internal control over financial reporting, concluding that these controls were not effective as of December 31, 2023[87]. - The company is committed to remediating its material weaknesses in internal controls, but there is no assurance on the timeline for remediation[89]. - The company has not had its auditors provide an attestation of management's assessment of internal control over financial reporting, which may leave material weaknesses undetected[170]. - The company must maintain effective internal controls to provide reliable financial reports and detect fraud, as failure to do so could harm operating results and investor confidence[163]. - The company has a risk management program overseen by the Board of Directors and Audit Committee, integrating cybersecurity into overall risk management processes[179]. Employee and Operational Considerations - The company employs 64 full-time employees as of December 31, 2023, and considers its employee relations to be good[78]. - The company relies heavily on key personnel, including the President and CEO, and any loss of these executives could significantly harm business operations[120]. - As the business expands, the company needs to hire additional personnel, particularly in IT, engineering, marketing, and customer support, to maintain growth[121]. - The company recognizes that its operating results may vary significantly from quarter to quarter due to seasonality and the rapidly evolving nature of its business[151]. Financial and Stock Market Considerations - Approximately 24% of the company's outstanding shares of common stock are beneficially owned by insiders, which may adversely affect stock price and limit investor influence[166]. - The trading price of the company's common stock is likely to be highly volatile, which could lead to losses for investors[164]. - The company may experience dilution of ownership interests due to future issuance of additional shares or convertible securities[165]. - Limited trading activity in the company's common stock may make it difficult for shareholders to sell shares at attractive prices[160]. - The company may need to raise additional capital to meet long-term business requirements, which could dilute current stockholders' ownership interests[145].

Revenue Performance - Revenue for the three months ended September 30, 2023, was $572,916, a decrease of approximately $251,831 or 31% compared to $824,747 in the same period of the prior year[107]. - Business to consumer (B2C) revenue decreased from $273,001 in Q3 2022 to $195,757 in Q3 2023, reflecting a decline of approximately 28.3%[107]. - Revenue for the nine months ended September 30, 2023, was $2,106,115, a decrease of approximately $1,289,566 or 38% compared to $3,395,681 in the same period of the prior year[116]. Cost and Expenses - Cost of revenues increased to $59,417 during Q3 2023, representing 10% of total revenue, up from 5% in Q3 2022[109]. - Cost of revenues decreased to $255,683 during the nine months ended September 30, 2023, compared to $637,096 during the same period in 2022, with cost of revenues as a percentage of revenue at 12% in 2023 versus 19% in 2022[119]. - Selling, general and administrative expenses were $669,386 in Q3 2023, a decrease of $646,330 from $1,315,716 in Q3 2022, primarily due to a $637,681 employee retention tax refund[111]. - Selling, general and administrative expenses were $4,273,187 during the nine months ended September 30, 2023, an increase of $45,421 from $4,227,766 in the same period of 2022[121]. Losses and Financial Challenges - The company incurred a loss from operations of $190,054 for Q3 2023, an improvement from a loss of $566,911 in Q3 2022[113]. - Net loss for Q3 2023 was $191,970, compared to a net loss of $596,342 in Q3 2022, reflecting reduced operating expenses[115]. - The company experienced a net loss of $2,457,522 during the nine months ended September 30, 2023, highlighting ongoing financial challenges[100]. - The company incurred a loss from operations of $2,422,755 for the nine months ended September 30, 2023, compared to a loss of $1,555,849 for the same period in 2022[123]. - The net loss for the nine months ended September 30, 2023, was $2,457,572, compared to a net loss of $517,851 for the same period in 2022[125]. Cash Flow and Financing - The company had cash of $2,613,868 available to fund operations as of September 30, 2023[100]. - Cash used in operating activities for the nine months ended September 30, 2023, was approximately $1,001,156, compared to $717,244 in the same period of 2022[130]. - Cash provided by financing activities for the nine months ended September 30, 2023, was $2,492,066, compared to $236,864 in the same period of 2022[135]. - As of September 30, 2023, the company had cash on hand of $2,613,868, with substantial doubt about its ability to continue as a going concern[126][128]. Debt and Loans - The total principal and accrued interest of convertible debt assumed upon reverse merger was $38,637 as of September 30, 2023[136]. - The Company received a total of $650,000 from two Economic Injury Disaster Loans (EIDL) in 2020 and 2021, and assumed an additional $14,500 EIDL on January 31, 2022[141]. - The loans have an interest rate of 3.75% per annum, with a combined repayment of principal and interest of $3,500 per month over 30 years[142]. - As of September 30, 2023, the note payable had a principal balance of $661,035 and accrued interest payable of $34,411[142]. Accounting Policies and Estimates - The Company follows U.S. GAAP and regularly evaluates key estimates and assumptions that could materially affect reported amounts[144]. - Significant estimates include reserves for uncollectible accounts and the valuation of stock instruments issued for services[144]. - There were no changes to critical accounting policies that impacted the condensed consolidated financial statements[144]. - Recent accounting pronouncements are discussed in Note 2 of the Notes to Condensed Financial Statements[145]. - A smaller reporting company is not required to provide market risk disclosures[146]. Mergers and Acquisitions - The company has entered into a merger agreement with CardCash Exchange, Inc. for a total consideration of $29.7 million, including $2 million in cash and 6,108,077 restricted shares[97]. Other Financial Activities - The company recorded no investing activities for the nine months ended September 30, 2023, compared to cash provided by investing activities of $12,805 in the same period of 2022[134]. - There were no off-balance sheet arrangements reported by the Company[143].