Core Points - Surge Copper Corp. has granted long-term equity-based incentive awards, including 2,337,500 restricted share units (RSUs) to employees and executives, and 1,750,000 deferred share units (DSUs) to non-executive directors [1][2] - The RSUs will vest in equal annual installments over three years, while the DSUs will vest upon the holder's departure from the company [2] - Surge Copper Corp. is advancing a critical metals district in British Columbia, owning a large mineral claim package with multiple advanced porphyry deposits [3] - The company holds a 100% interest in the Berg Project, which has a Preliminary Economic Assessment (PEA) indicating an NPV8% of C$2.1 billion and an IRR of 20% based on long-term commodity prices [4] - The Berg deposit contains NI 43-101 compliant resources of copper, molybdenum, silver, and gold [4] - Surge Copper also owns the Ootsa Property, which contains advanced-stage exploration projects with NI 43-101 compliant resources of copper, gold, molybdenum, and silver [5]

SurgePays Inc. (NASDAQ:SURG) is one of the most undervalued telecom stocks to invest in. On August 28, SurgePays announced the complete deployment of its ClearLine SaaS platform across all 17 Market Basket Food Stores in North Carolina. The initiative marks a key milestone in SurgePays’ strategy to generate recurring, high-margin SaaS revenue through a nationwide rollout of its retail media solution. The ClearLine platform transforms mounted flat screens into retail media hubs that can display video ads, ...

Core Viewpoint - SurgePays, Inc. has successfully deployed its ClearLine digital advertising platform across all 17 Market Basket Food Stores in North Carolina, enhancing in-store advertising capabilities and creating new revenue streams through a subscription-based model [1][2][5]. Group 1: ClearLine Platform Deployment - The ClearLine platform transforms mounted flat screens into connected retail media hubs, enabling real-time video ads, promotions, and coupons [2][4]. - This deployment is seen as a validation of SurgePays' strategy to enhance shopper engagement and create subscription-based advertising revenue streams [3][4]. - The technology allows for dynamic advertising campaigns tailored to specific times of day and inventory levels, improving customer experience and driving sales [8]. Group 2: Market Basket's Experience - Market Basket faced challenges with previous digital signage efforts, which were unreliable and required a tech-savvy partner to function effectively [6]. - The ClearLine platform was selected to replace outdated signage, allowing for better content management and promotional capabilities [8]. - The successful implementation of ClearLine across all Market Basket stores demonstrates its effectiveness in boosting sales and enhancing brand loyalty [4][8]. Group 3: Future Growth and Strategy - SurgePays aims to expand ClearLine across its nationwide wireless retail network, which includes thousands of locations, to drive predictable SaaS revenues and increase market share [5]. - The company is positioned to accelerate installations into additional convenience and independent grocery chains, enhancing long-term shareholder value [5]. - The deployment of ClearLine is part of a broader strategy to leverage AI-powered marketing for maximum consumer engagement [3].

Core Viewpoint - Surge Copper Corp. is advancing its 2025 field program at the Berg copper-molybdenum-precious metals project, focusing on resource updates and a pre-feasibility study while also engaging in a strategic private placement to raise approximately $4.5 million [1][6][7]. Operational Update - The 2025 field program at the Berg project is progressing with resource drilling nearing completion, totaling approximately 1,500 meters planned [2][3]. - The first geotechnical hole has been completed, which will help characterize ground conditions for proposed infrastructure [3]. - The program includes the first uphill-angle drilling at Berg, with a successful 456-meter hole completed at a 14-degree dip to assess mineralization and acid rock drainage potential [4]. - Additional activities include geophysical surveys, environmental baseline studies, and logistical preparations, contributing to the data needed for the pre-feasibility study [5]. Strategic Investment Update - Surge is conducting a private placement of common shares to a strategic investor, increasing their ownership to 19.9% of the company, expected to raise approximately $4.5 million [6][7]. - The subscription agreement for the private placement has been executed, and regulatory approval processes are underway in South Africa [7]. - The transaction is anticipated to close within approximately four weeks, pending necessary regulatory approvals [7]. Upcoming Investor Events - Surge management will participate in several investor conferences in North America and the UK, including the Precious Metals Summit in Colorado and the Metals Investor Forum in Vancouver [10].

SurgePays, Inc. (SURG) came out with a quarterly loss of $0.36 per share versus the Zacks Consensus Estimate of a loss of $0.31. This compares to a loss of $0.66 per share a year ago. These figures are adjusted for non- recurring items. This quarterly report represents an earnings surprise of -16.13%. A quarter ago, it was expected that this company would post a loss of $0.4 per share when it actually produced a loss of $0.38, delivering a surprise of +5%. Over the last four quarters, the company has surpas ...

Financial Data and Key Metrics Changes - The company's revenue for Q2 2025 increased approximately 8.9% sequentially, totaling approximately $22.1 million for the year [4][15] - Platform service revenue grew significantly, generating $9.2 million in 2025 compared to $2.5 million in 2024 [15] - Gross profit was a loss of $2.7 million for 2025, an improvement from a loss of $3.4 million in 2024 [16] - The net loss for 2025 was reported at $7.1 million, with a loss per share of negative $0.35 [18] Business Line Data and Key Metrics Changes - The Lifeline Wireless program through the Torch brand has scaled significantly, with activations increasing from 20,000 in June to 57,000 in July, and projections of 80,000 to 90,000 by September [5][6] - The MVNO prepaid LinkUp platform launched in April, activating approximately 10,000 users, which more than doubled to over 20,500 in July [9] - Third-party prepaid wireless top-up revenue reached $4.3 million in July, with projections of nearly $5 million in August [10] Market Data and Key Metrics Changes - The company is focusing on states with higher margins for Lifeline activations, leveraging experience from previous programs [25][32] - The competitive landscape includes established companies, but the company differentiates itself through its compensation structure and proprietary enrollment platform [64][66] Company Strategy and Development Direction - The company aims to ramp up to 100,000 locations operating on its platform through organic growth and distribution agreements [14] - A strategic partnership with AT&T enhances the company's telecom infrastructure capabilities [7][8] - The focus is on transitioning from ACP to Lifeline and LinkUp, with a clear strategy to prioritize known revenue streams for quicker profitability [33][32] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in growth, citing strong activation growth and expanding distribution as key drivers [20] - The company is optimistic about future revenue guidance, projecting $75 million to $90 million for 2025 and $225 million to $240 million for 2026 [5][18] - Management acknowledged the challenges faced during the transition but emphasized the importance of execution at scale [20] Other Important Information - The company has made significant investments in infrastructure and operational efficiencies to support growth [7] - The Lifeline program has been operational for a long time, and the company has leveraged its historical experience to enhance its current offerings [25] Q&A Session Summary Question: What are the key drivers for Lifeline activations? - Management highlighted the focus on states with higher margins and the experience gained from previous programs as key drivers for growth [24][25] Question: How does the company balance priorities between Lifeline and LinkUp? - The company prioritizes known revenue streams, focusing on Lifeline for quicker profitability while still supporting LinkUp's growth [29][33] Question: How is the competitive marketplace, and is there a risk of price competition? - Management acknowledged competition but emphasized their unique compensation structure and proprietary platform as differentiators [64][66]

[FORM 10-Q Filing Information](index=1&type=section&id=FORM%2010-Q%20Filing%20Information) This section outlines SurgePays, Inc.'s Form 10-Q filing details, including its Nasdaq listing, outstanding shares, and regulatory classifications [Registrant Information](index=1&type=section&id=Registrant%20Information) SurgePays, Inc. filed its Form 10-Q, detailing its Nevada incorporation, Nasdaq listing under SURG, **20.43 million** outstanding shares, and non-accelerated filer status - SurgePays, Inc. is a non-accelerated filer and a smaller reporting company[3](index=3&type=chunk) Consolidated Balance Sheet Highlights | Metric | Value | | :------------------------------------------------ | :------------------- | | Shares of Common Stock Outstanding (as of Aug 13, 2025) | 20,431,549 shares | | Trading Symbol | SURG | | Exchange | The Nasdaq Stock Market LLC | [Consolidated Financial Statements](index=3&type=section&id=Consolidated%20Financial%20Statements) This section presents SurgePays, Inc.'s unaudited consolidated financial statements, including balance sheets, statements of operations, changes in stockholders' equity, and cash flows [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) Total assets decreased to **$15.22 million** by June 30, 2025, driven by reduced cash, while total liabilities increased to **$15.15 million** due to new convertible notes, significantly impacting stockholders' equity Consolidated Balance Sheet Highlights | Metric | June 30, 2025 (Unaudited) | December 31, 2024 | | :-------------------------------- | :-------------------------- | :------------------ | | Cash and cash equivalents | $4,404,449 | $11,790,389 | | Total Current Assets | $9,694,382 | $17,870,323 | | Total Assets | $15,215,409 | $23,976,005 | | Total Current Liabilities | $8,702,069 | $6,059,476 | | Total Long Term Liabilities | $6,451,948 | $2,654,916 | | Total Liabilities | $15,154,017 | $8,714,392 | | Total Stockholders' Equity | $61,392 | $15,261,613 | - Cash and cash equivalents decreased by approximately **$7.39 million** from December 31, 2024, to June 30, 2025[7](index=7&type=chunk) - Convertible note payable (net) increased significantly from **$0** at December 31, 2024, to **$1,430,267** (current) and **$4,833,979** (long-term) at June 30, 2025[7](index=7&type=chunk) [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) For the six months ended June 30, 2025, net loss increased to **$14.72 million** on a **52.5% revenue decline** to **$22.10 million**, primarily due to the ACP cessation, widening the loss from operations Consolidated Statements of Operations Highlights | Metric | For the Three Months Ended June 30, 2025 | For the Three Months Ended June 30, 2024 | For the Six Months Ended June 30, 2025 | For the Six Months Ended June 30, 2024 | | :----------------------------------- | :--------------------------------------- | :--------------------------------------- | :------------------------------------- | :------------------------------------- | | Revenues | $11,518,166 | $15,085,699 | $22,095,596 | $46,514,834 | | Total costs and expenses | $18,328,675 | $25,961,752 | $36,486,008 | $55,639,026 | | Loss from operations | $(6,810,509) | $(10,876,053) | $(14,390,412) | $(9,124,192) | | Net loss available to common stockholders | $(7,082,598) | $(12,865,765) | $(14,717,682) | $(11,641,170) | | Basic EPS | $(0.36) | $(0.66) | $(0.74) | $(0.63) | - Revenues for the six months ended June 30, 2025, decreased by **52.5%** compared to the same period in 2024[9](index=9&type=chunk) - Net loss available to common stockholders for the six months ended June 30, 2025, increased by **26.4%** year-over-year[9](index=9&type=chunk) [Consolidated Statements of Changes in Stockholders' Equity](index=6&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Stockholders%27%20Equity) Total stockholders' equity significantly decreased to **$0.06 million** by June 30, 2025, primarily due to a **$14.72 million net loss** and **$1.00 million treasury stock reacquisition** Changes in Stockholders' Equity (Six Months Ended June 30, 2025) | Metric | December 31, 2024 | June 30, 2025 | | :----------------------------------- | :------------------ | :-------------- | | Total Stockholders' Equity | $15,261,613 | $61,392 | | Net loss | - | $(14,717,682) | | Additional paid-in capital (increase) | $76,842,878 | $77,360,756 | | Treasury stock (increase) | $(631,967) | $(1,631,966) | - The company reacquired **333,333 shares** of treasury stock for **$999,999** in connection with convertible debt financing during the six months ended June 30, 2025[11](index=11&type=chunk) - Recognition of stock-based compensation for unvested shares (related parties) contributed **$310,238** to additional paid-in capital during the six months ended June 30, 2025[11](index=11&type=chunk) [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash, cash equivalents, and restricted cash decreased by **$8.39 million** to **$4.40 million** by June 30, 2025, driven by **$13.08 million** in operating cash outflows, partially offset by financing activities Consolidated Statements of Cash Flows Highlights | Metric | For the Six Months Ended June 30, 2025 | For the Six Months Ended June 30, 2024 | | :------------------------------------------------ | :------------------------------------- | :------------------------------------- | | Net cash used in operating activities | $(13,082,419) | $(90,112) | | Net cash used in investing activities | $(18,590) | $- | | Net cash provided by financing activities | $4,715,069 | $23,902,632 | | Net increase (decrease) in cash, cash equivalents and restricted cash | $(8,385,940) | $23,812,520 | | Cash, cash equivalents and restricted cash - end of period | $4,404,449 | $38,434,580 | - Operating cash outflows significantly increased from **$90,112** in H1 2024 to **$13,082,419** in H1 2025, primarily due to the net loss[15](index=15&type=chunk)[406](index=406&type=chunk) - Financing activities in H1 2025 included **$6,000,000** from the issuance of a convertible note payable, partially offset by **$595,000** in direct offering costs and **$684,419** in repayments of related party loans[15](index=15&type=chunk) [Notes to Unaudited Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures supporting the unaudited consolidated financial statements, covering accounting policies, debt, equity, and segment information [Note 1 - Organization and Nature of Operations](index=10&type=section&id=Note%201%20-%20Organization%20and%20Nature%20of%20Operations) SurgePays operates in telecom and fintech for underserved communities, discontinued its LogicsIQ segment, faces significant liquidity challenges with a **$14.72 million net loss**, and plans strategic initiatives to address going concern doubts - SurgePays operates in three primary business segments: MVNO wireless brands, MVNE enablement platform (HERO), and point-of-sale (POS) and fintech services[19](index=19&type=chunk) - The lead generation segment (LogicsIQ) was abandoned effective December 31, 2024, as it contributed **0%** of total consolidated revenue and less than **1%** of total assets, not qualifying as a discontinued operation under ASC 205-20[24](index=24&type=chunk)[26](index=26&type=chunk) Key Financial Indicators (Six Months Ended June 30, 2025) | Metric | Amount | | :----------------------------------- | :------------- | | Net loss available to common stockholders | $(14,717,682) | | Net cash used in operations | $(13,082,419) | | Accumulated deficit | $(75,633,109) | | Stockholders' equity | $61,392 | | Working capital | $992,313 | - The Affordable Connectivity Program (ACP) ceased funding on June 1, 2024, impacting the company's MVNO segment[42](index=42&type=chunk) - Management's strategic plans include * Enhance market visibility and customer reach for SurgePays' direct MVNO, Linkup Mobile * Diversify Lifeline revenue streams by expanding into California and other states * Sustain platform growth to bolster baseline revenue * Investigate specialized marketing strategies and customer engagement initiatives through the Clearline product offering[45](index=45&type=chunk) [Discontinued Operations – LogicsIQ Segment](index=11&type=section&id=Discontinued%20Operations%20%E2%80%93%20LogicsIQ%20Segment) [Segment Reporting (ASC 280) Considerations](index=12&type=section&id=Segment%20Reporting%20%28ASC%20280%29%20Considerations) [Future Business Operations](index=13&type=section&id=Future%20Business%20Operations) [Basis of Presentation](index=13&type=section&id=Basis%20of%20Presentation) [Liquidity and Management's Plans](index=14&type=section&id=Liquidity%20and%20Management%27s%20Plans) [Note 2 - Summary of Significant Accounting Policies](index=15&type=section&id=Note%202%20-%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines SurgePays' critical accounting policies, covering consolidation, business combinations like ClearLine Mobile, revenue recognition (ASC 606), asset valuation, impairment, software development costs, stock-based compensation, and recent accounting standard adoptions - The acquisition of ClearLine Mobile, Inc. on January 5, 2024, for **$2,500,000** was accounted for as a business combination, resulting in **$2,500,000** in goodwill[58](index=58&type=chunk)[62](index=62&type=chunk)[67](index=67&type=chunk) - The Mobile Virtual Network Operator (MVNO) segment's revenue share decreased significantly from **89%** in H1 2024 to **20.64%** in H1 2025, while Point-of-Sale and Prepaid Services revenue share increased from **10.98%** to **79.36%** over the same period[154](index=154&type=chunk) Disaggregation of Revenues (Six Months Ended June 30) | Revenue Segment | 2025 Revenue | % of Revenues (2025) | 2024 Revenue | % of Revenues (2024) | | :--------------------------------- | :------------- | :------------------- | :------------- | :------------------- | | Mobile Virtual Network Operators | $4,559,530 | 20.64% | $41,396,096 | 89.00% | | Point-of-Sale and Prepaid Services | $17,536,066 | 79.36% | $5,107,409 | 10.98% | | Other Corporate Overhead | $- | 0.00% | $11,329 | 0.02% | | Total Revenues | $22,095,596 | 100.00% | $46,514,834 | 100.00% | - The company recorded a full valuation allowance on its deferred tax assets as of June 30, 2025, due to being in a three-year cumulative historic loss position[160](index=160&type=chunk)[161](index=161&type=chunk) - The investment in CenterCom was impaired and written down to **$0** as of December 31, 2024, due to a change in ownership and a large reduction in human capital, leading to the discontinuation of BPO services[168](index=168&type=chunk)[169](index=169&type=chunk) [Principles of Consolidation and Non-Controlling Interest](index=15&type=section&id=Principles%20of%20Consolidation%20and%20Non-Controlling%20Interest) [Business Combinations and Asset Acquisitions](index=15&type=section&id=Business%20Combinations%20and%20Asset%20Acquisitions) [Acquisition of ClearLine Mobile, Inc](index=16&type=section&id=Acquisition%20of%20ClearLine%20Mobile%2C%20Inc) [Note Receivable (Sale of Former Subsidiary)](index=18&type=section&id=Note%20Receivable%20%28Sale%20of%20Former%20Subsidiary%29) [Business Segments and Concentrations](index=18&type=section&id=Business%20Segments%20and%20Concentrations) [Use of Estimates](index=19&type=section&id=Use%20of%20Estimates) [Risks and Uncertainties](index=19&type=section&id=Risks%20and%20Uncertainties) [Fair Value of Financial Instruments](index=20&type=section&id=Fair%20Value%20of%20Financial%20Instruments) [Cash and Cash Equivalents, Restricted Cash and Concentration of Credit Risk](index=21&type=section&id=Cash%20and%20Cash%20Equivalents%2C%20Restricted%20Cash%20and%20Concentration%20of%20Credit%20Risk) [Marketable Securities - Classification and Valuation](index=21&type=section&id=Marketable%20Securities%20-%20Classification%20and%20Valuation) [Impairment of Marketable Securities](index=22&type=section&id=Impairment%20of%20Marketable%20Securities) [Accounts Receivable](index=23&type=section&id=Accounts%20Receivable) [Inventory](index=23&type=section&id=Inventory) [Impairment of Long-lived Assets](index=23&type=section&id=Impairment%20of%20Long-lived%20Assets) [Property and Equipment](index=24&type=section&id=Property%20and%20Equipment) [Internal Use Software Development Costs](index=24&type=section&id=Internal%20Use%20Software%20Development%20Costs) [Right of Use Assets and Lease Obligations](index=25&type=section&id=Right%20of%20Use%20Assets%20and%20Lease%20Obligations) [Revenue Recognition](index=26&type=section&id=Revenue%20Recognition) [Cost of Revenues](index=30&type=section&id=Cost%20of%20Revenues) [Income Taxes](index=30&type=section&id=Income%20Taxes) [Investment](index=31&type=section&id=Investment) [Advertising Costs](index=32&type=section&id=Advertising%20Costs) [Stock-Based Compensation](index=32&type=section&id=Stock-Based%20Compensation) [Stock Warrants](index=33&type=section&id=Stock%20Warrants) [Basic and Diluted Earnings (Loss) per Share](index=33&type=section&id=Basic%20and%20Diluted%20Earnings%20%28Loss%29%20per%20Share) [Treasury Stock](index=34&type=section&id=Treasury%20Stock) [Related Parties](index=35&type=section&id=Related%20Parties) [Recent Accounting Standards](index=36&type=section&id=Recent%20Accounting%20Standards) [Reclassifications](index=37&type=section&id=Reclassifications) [Note 3 – Property and Equipment](index=37&type=section&id=Note%203%20%E2%80%93%20Property%20and%20Equipment) As of June 30, 2025, SurgePays' net property and equipment totaled **$457,195**, a decrease from **$591,088** at December 31, 2024, reflecting **$152,483** in depreciation and amortization for the six months ended June 30, 2025 Property and Equipment - Net | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :-------------- | :------------------ | | Computer equipment and software | $1,135,178 | $1,135,178 | | Leasehold improvements | $324,901 | $306,311 | | Furniture and fixtures | $165,738 | $165,738 | | Less: accumulated depreciation/amortization | $(1,168,622) | $(1,016,139) | | Property and equipment - net | $457,195 | $591,088 | Depreciation and Amortization Expense | Period | 2025 | 2024 | | :-------------------------------- | :------- | :------- | | Three months ended June 30 | $66,365 | $70,383 | | Six months ended June 30 | $152,483 | $140,766 | [Note 4 – Intangibles](index=38&type=section&id=Note%204%20%E2%80%93%20Intangibles) Net intangible assets decreased to **$1.15 million** at June 30, 2025, from **$1.47 million** at December 31, 2024, primarily due to ongoing amortization, with proprietary software as the largest component Intangible Assets - Net | Type | June 30, 2025 | December 31, 2024 | Estimated Useful Lives (Years) | | :------------------------ | :-------------- | :------------------ | :----------------------------- | | Proprietary Software | $4,286,402 | $4,286,402 | 7 | | Tradenames/trademarks | $617,474 | $617,474 | 15 | | ECS membership agreement | $465,000 | $465,000 | 1 | | Noncompetition agreement | $201,389 | $201,389 | 2 | | Customer Relationships | $183,255 | $183,255 | 5 | | Less: accumulated amortization | $(4,607,764) | $(4,280,558) | | | Intangibles - net | $1,145,756 | $1,472,962 | | Amortization Expense for Intangibles | Period | 2025 | 2024 | | :-------------------- | :------- | :------- | | Three Months Ended June 30 | $163,452 | $163,377 | | Six Months Ended June 30 | $327,206 | $326,754 | - Estimated amortization expense for the remaining six months of 2025 is **$326,754**, and for 2026 is **$653,508**[206](index=206&type=chunk) [Note 5 – Internal Use Software Development Costs](index=39&type=section&id=Note%205%20%E2%80%93%20Internal%20Use%20Software%20Development%20Costs) Net internal use software development costs were **$0** at June 30, 2025, following a **$316,594** impairment loss recorded at December 31, 2024, due to no future use Internal Use Software Development Costs - Net | Type | December 31, 2024 | | :------------------------------------ | :------------------ | | Internal use software development costs | $668,484 | | Less: accumulated amortization | $(351,890) | | Less: impairment loss | $(316,594) | | Internal Use Software Development Costs - net | $- | - An impairment loss of **$316,594** was recorded at December 31, 2024, due to the determination of no future use for capitalized internal use software development costs[209](index=209&type=chunk) Amortization of Internal Software Development Costs (2024) | Period | Amount | | :------------------------------------ | :------- | | Three months ended June 30, 2024 | $55,707 | | Six months ended June 30, 2024 | $111,414 | [Note 6 – Debt](index=39&type=section&id=Note%206%20%E2%80%93%20Debt) Total debt, net of unamortized discount, increased to **$9.60 million** at June 30, 2025, from **$3.56 million** at December 31, 2024, primarily due to a new **$7.00 million** Senior Secured Convertible Note Summary of Debt Balances | Debt Type | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :-------------- | :------------------ | | Notes Payable – SBA government | $463,884 | $469,396 | | Notes Payable – Related Parties | $2,871,236 | $3,555,655 | | Convertible Note Payable - net | $6,264,246 | $- | | Total Debt - net | $9,599,366 | $4,025,051 | - On May 12, 2025, the company issued a Senior Secured Convertible Note for **$6,999,999**, resulting in net cash proceeds of **$6,000,000**. This note accrues interest at **1.25%** per month (**15%** per annum) and is convertible at **$4.00** per share[221](index=221&type=chunk)[223](index=223&type=chunk)[224](index=224&type=chunk) - In connection with the convertible note, warrants to purchase **700,000 shares** at **$6/share** were issued, and a total debt discount of **$802,640** (including **$207,640** for warrants and **$595,000** for direct offering costs) is being amortized[227](index=227&type=chunk)[228](index=228&type=chunk)[229](index=229&type=chunk)[230](index=230&type=chunk) - The related party note with the CEO was consolidated on March 12, 2024, into a single **$5,083,554** note bearing **10%** interest, with monthly payments of **$164,039**[218](index=218&type=chunk) [Notes Payable – SBA government](index=39&type=section&id=Notes%20Payable%20%E2%80%93%20SBA%20government) [Notes Payable – Related Parties](index=40&type=section&id=Notes%20Payable%20%E2%80%93%20Related%20Parties) [Senior Secured Convertible Note and Warrants](index=41&type=section&id=Senior%20Secured%20Convertible%20Note%20and%20Warrants) [Debt Maturities](index=43&type=section&id=Debt%20Maturities) [Note 7 – Fair Value of Financial Instruments](index=44&type=section&id=Note%207%20%E2%80%93%20Fair%20Value%20of%20Financial%20Instruments) SurgePays did not have financial assets or liabilities measured at fair value on a recurring basis as of June 30, 2025, with carrying values approximating fair values due to their short-term nature - The company did not have any financial assets and liabilities measured at fair value on a recurring basis at June 30, 2025, and December 31, 2024[236](index=236&type=chunk) [Note 8 – Commitments and Contingencies](index=44&type=section&id=Note%208%20%E2%80%93%20Commitments%20and%20Contingencies) SurgePays has operating lease commitments with a **1.84-year** weighted-average remaining term, details employment agreements for its CEO and CFO, and is involved in ongoing legal matters, with no current contingent liabilities requiring accrual Operating Lease Assets and Liabilities | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------ | :-------------- | :------------------ | | Operating lease - right-of-use asset - non-current | $441,225 | $564,781 | | Operating lease liability | $446,249 | $567,301 | | Weighted-average remaining lease term (years) | 1.84 | 2.29 | | Weighted-average discount rate | 8% | 8% | Future Minimum Lease Payments (Undiscounted) | Year Ended December 31, | Amount | | :------------------------ | :------- | | 2025 (6 months) | $141,831 | | 2026 | $236,078 | | 2027 | $100,563 | | Total undiscounted cash flows | $478,472 | - CEO's employment agreement extends through December 31, 2028, with a base salary of **$750,000** (2023) increasing by **3%** annually, an annual cash bonus of **$870,000**, and a long-term equity program for up to **2,500,000 shares**[260](index=260&type=chunk)[264](index=264&type=chunk) - CFO's employment agreement includes a base salary of **$503,928** for 2025, an annual cash bonus of at least **$510,000** (2024), and a restricted stock award of **600,000 shares** (granted Nov 2023) vesting over specific periods[257](index=257&type=chunk) - The legal case 'Juno Financial v. AATAC and Surge Holdings Inc.' was dismissed with agreement of the parties on September 12, 2024[272](index=272&type=chunk) - In 'Blue Skies Connections, LLC, and True Wireless, Inc. v. SurgePays, Inc., et. al.', the Oklahoma Supreme Court denied Plaintiffs' petition for certiorari on March 10, 2025, and the case will proceed in district court on remaining claims[273](index=273&type=chunk) [Operating Leases](index=44&type=section&id=Operating%20Leases) [Employment Agreements (Chief Executive Officer and Chief Financial Officer)](index=48&type=section&id=Employment%20Agreements%20%28Chief%20Executive%20Officer%20and%20Chief%20Financial%20Officer%29) [Contingencies – Legal Matters](index=51&type=section&id=Contingencies%20%E2%80%93%20Legal%20Matters) [Note 9 – Stockholders' Equity](index=53&type=section&id=Note%209%20%E2%80%93%20Stockholders%27%20Equity) SurgePays' stockholders' equity section details common stock, preferred stock, and the 2022 Securities and Incentive Plan, with key H1 2025 transactions including the repurchase of **333,333 treasury shares** for **$999,999** and **$310,238** in stock-based compensation expense - The 2022 Securities and Incentive Plan authorized **3,500,000** common shares initially, with annual increases of **10%** of outstanding common stock. As of January 1, 2025, total authorized shares under the plan approximated **6,907,000**[284](index=284&type=chunk)[286](index=286&type=chunk)[287](index=287&type=chunk) - For the six months ended June 30, 2025, the company repurchased **333,333 shares** of treasury stock for **$999,999** (**$3/share**) in connection with a convertible debt financing[289](index=289&type=chunk) Total Stock Compensation Expense (Vesting) | Period | 2025 | 2024 | | :-------------------- | :------- | :------- | | Three months ended June 30 | $155,119 | $2,981,577 | | Six months ended June 30 | $310,238 | $4,478,994 | Outstanding Potentially Dilutive Equity Securities | Security Type | June 30, 2025 | June 30, 2024 | | :-------------- | :-------------- | :-------------- | | Warrants | 703,000 | 3,619,278 | | Stock options | 1,166,081 | 121,276 | | Total | 1,869,081 | 3,740,554 | [Common Stock](index=53&type=section&id=Common%20Stock) [Series A, Convertible Preferred Stock](index=53&type=section&id=Series%20A%2C%20Convertible%20Preferred%20Stock) [Series C, Convertible Preferred Stock](index=53&type=section&id=Series%20C%2C%20Convertible%20Preferred%20Stock) [Securities and Incentive Plan](index=53&type=section&id=Securities%20and%20Incentive%20Plan) [Equity Transactions for the Six Months Ended June 30, 2025](index=54&type=section&id=Equity%20Transactions%20for%20the%20Six%20Months%20Ended%20June%2030%2C%202025) [Equity Transactions for the Years Ended December 31, 2024](index=54&type=section&id=Equity%20Transactions%20for%20the%20Years%20Ended%20December%2031%2C%202024) [Non-Vested Shares – Related Parties (Officer and Directors) – and related Vesting](index=56&type=section&id=Non-Vested%20Shares%20%E2%80%93%20Related%20Parties%20%28Officer%20and%20Directors%29%20%E2%80%93%20and%20related%20Vesting) [Stock Options](index=59&type=section&id=Stock%20Options) [Warrants](index=61&type=section&id=Warrants) [Note 10 – Segment Information](index=61&type=section&id=Note%2010%20%E2%80%93%20Segment%20Information) For H1 2025, MVNO segment revenue significantly decreased to **$4.56 million** with a **$5.90 million** operating loss, while Point-of-Sale and Prepaid Services revenue grew to **$17.54 million** but still reported a **$2.15 million** operating loss Segment Revenues (Six Months Ended June 30) | Segment | 2025 Revenue | 2024 Revenue | | :--------------------------------- | :------------- | :------------- | | Mobile Virtual Network Operators | $4,559,530 | $41,396,096 | | Point-of-Sale and Prepaid Services | $17,536,066 | $5,107,409 | | Other Corporate Overhead | $- | $11,329 | | Total | $22,095,596 | $46,514,834 | Segment Income (Loss) from Operations (Six Months Ended June 30) | Segment | 2025 Income (Loss) | 2024 Income (Loss) | | :--------------------------------- | :----------------- | :----------------- | | Mobile Virtual Network Operators | $(5,895,378) | $4,552,821 | | Point-of-Sale and Prepaid Services | $(2,148,108) | $(1,382,103) | | Other Corporate Overhead | $(6,346,926) | $(12,294,910) | | Total | $(14,390,412) | $(9,124,192) | Segment Total Liabilities | Segment | June 30, 2025 | December 31, 2024 | | :--------------------------------- | :-------------- | :------------------ | | Mobile Virtual Network Operators | $1,835,032 | $1,505,400 | | Point-of-Sale and Prepaid Services | $696,235 | $103,612 | | Other Corporate Overhead | $12,622,750 | $7,105,380 | | Total | $15,154,017 | $8,714,392 | [Note 11 – Subsequent Event](index=62&type=section&id=Note%2011%20%E2%80%93%20Subsequent%20Event) In August 2025, SurgePays entered an At The Market Offering Agreement (ATM Agreement) to sell up to **$15,000,000** of common stock to fund working capital needs - In August 2025, SurgePays entered into an At The Market Offering Agreement (ATM Agreement) to sell up to **$15,000,000** of common stock[335](index=335&type=chunk)[336](index=336&type=chunk) - The ATM Agreement is intended to fund working capital needs on an ongoing basis[336](index=336&type=chunk) [ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=64&type=section&id=ITEM%202%3A%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) This section provides management's perspective on SurgePays' financial condition, operational results, business segments, growth strategies, and critical accounting policies [About SurgePays, Inc.](index=64&type=section&id=About%20SurgePays%2C%20Inc.) SurgePays, Inc., incorporated in Nevada in 2006, has evolved into a financial technology and telecom company providing essential services to the underbanked through MVNO wireless and Point-of-Sale services - SurgePays, Inc. was incorporated in Nevada on August 18, 2006, and has evolved from an oil and natural gas company to a financial technology and telecom company[338](index=338&type=chunk) - The company operates in two business segments: SurgePhone Wireless, LLC, SurgePays Fintech, Inc., ECS Prepaid, LLC, and Torch Wireless[339](index=339&type=chunk) [Our Business Segments](index=65&type=section&id=Our%20Business%20Segments) SurgePays operates two primary segments: MVNO Wireless Services (LinkUp Mobile and Torch Wireless) and Point-of-Sale and Prepaid Services, having launched its high-margin HERO MVNE platform in late 2024 and discontinued its Lead Generation segment - MVNO Wireless Services include LinkUp Mobile (prepaid wireless) and Torch Wireless (subsidized Lifeline program)[343](index=343&type=chunk)[344](index=344&type=chunk) - Point-of-Sale and Prepaid Services offer prepaid wireless top-ups and ClearLine POS Technology for in-store marketing and loyalty[349](index=349&type=chunk)[350](index=350&type=chunk) - In late 2024, SurgePays launched its HERO platform, a Mobile Virtual Network Enabler (MVNE) system, providing SIM provisioning, billing, CRM, and other services to independent MVNOs through a strategic agreement with AT&T[341](index=341&type=chunk)[346](index=346&type=chunk)[348](index=348&type=chunk) - The Lead Generation segment was discontinued in 2024[342](index=342&type=chunk) [Growth Strategies](index=66&type=section&id=Growth%20Strategies) SurgePays' growth strategy focuses on scaling Lifeline enrollments, expanding prepaid retail distribution, enabling wireless services via its HERO platform, and increasing ClearLine deployments and POS feature upsells - Current growth initiatives include * Scaling Lifeline enrollments in California and other high-subsidy states * Expanding prepaid retail distribution across rural and multicultural markets * Enabling wireless service launches for non-telecom brands through HERO * Increasing ClearLine deployments and upselling POS features to merchants[354](index=354&type=chunk) [Synergy Across Business Units](index=67&type=section&id=Synergy%20Across%20Business%20Units) SurgePays achieves synergy through technology integration across POS platforms, data-driven engagement from fintech transactions, and strategic market expansion targeting underserved and rural communities - Synergy is built on * **Technology Integration:** POS platforms unify transactions across prepaid wireless, financial products, and merchant services * **Data-Driven Engagement:** Data analytics from ACH banking and fintech transactions enhance customer engagement * **Strategic Market Expansion:** Focus on underserved and rural markets to capture untapped potential[359](index=359&type=chunk) [COMPARISON OF THREE MONTHS ENDED June 30, 2025 AND 2024](index=67&type=section&id=COMPARISON%20OF%20THREE%20MONTHS%20ENDED%20June%2030%2C%202025%20AND%202024) For Q2 2025, total revenue decreased by **23.7%** to **$11.52 million** due to an **81.8%** MVNO decline, while POS and Prepaid Services revenues surged by **258.8%**, resulting in a gross loss and widened operating loss Revenue Comparison (Three Months Ended June 30) | Segment | 2025 Revenue | 2024 Revenue | Change ($) | Change (%) | | :--------------------------------- | :------------- | :------------- | :----------- | :--------- | | Mobile Virtual Network Operator | $2,273,706 | $12,503,507 | $(10,229,801) | (81.8%) | | Point-of-Sale and Prepaid Services | $9,244,460 | $2,576,820 | $6,667,640 | 258.8% | | Other Corporate Overhead | $- | $5,372 | $(5,372) | (100.0%) | | Total | $11,518,166 | $15,085,699 | $(3,567,533) | (23.7%) | Gross Profit (Loss) and Margin (Three Months Ended June 30) | Segment | 2025 Gross Profit (Loss) | 2024 Gross Profit (Loss) | 2025 Gross Margin (%) | 2024 Gross Margin (%) | | :--------------------------------- | :----------------------- | :----------------------- | :-------------------- | :-------------------- | | Mobile Virtual Network Operator | $(2,109,831) | $(3,510,190) | (92.8%) | (28.1%) | | Point-of-Sale and Prepaid Services | $(544,835) | $67,704 | (5.9%) | 2.6% | | Other Corporate Overhead | $- | $(589) | - | (24.9%) | | Total | $(2,654,666) | $(3,443,075) | (23.0%) | (22.8%) | - General and administrative costs decreased by **$3,217,484** (**45.0%**) due to reductions in contractors and consultants, professional services (legal fees), and compensation (stock compensation)[369](index=369&type=chunk)[370](index=370&type=chunk) - Interest expense increased to **$212,419** in Q2 2025 from **$116,722** in Q2 2024, partly due to amortization of debt discount from the convertible note[371](index=371&type=chunk)[372](index=372&type=chunk) [Revenues](index=67&type=section&id=Revenues) [Cost of Revenue, Gross Profit and Gross Margin](index=69&type=section&id=Cost%20of%20Revenue%2C%20Gross%20Profit%20and%20Gross%20Margin) [General and administrative](index=69&type=section&id=General%20and%20administrative) [Other (expense) income](index=71&type=section&id=Other%20%28expense%29%20income) [Provision for income tax benefit (expense)](index=71&type=section&id=Provision%20for%20income%20tax%20benefit%20%28expense%29) [COMPARISON OF SIX MONTHS ENDED June 30, 2025 AND 2024](index=72&type=section&id=COMPARISON%20OF%20SIX%20MONTHS%20ENDED%20June%2030%2C%202025%20AND%202024) For H1 2025, total revenue decreased by **52.5%** to **$22.10 million** due to an **89.0%** MVNO decline, while POS and Prepaid Services revenues increased by **243.3%**, leading to a gross loss and widened operating loss Revenue Comparison (Six Months Ended June 30) | Segment | 2025 Revenue | 2024 Revenue | Change ($) | Change (%) | | :--------------------------------- | :------------- | :------------- | :----------- | :--------- | | Mobile Virtual Network Operator | $4,559,530 | $41,396,096 | $(36,836,567) | (89.0%) | | Point-of-Sale and Prepaid Services | $17,536,066 | $5,107,409 | $12,428,657 | 243.3% | | Other Corporate Overhead | $- | $11,329 | $(11,329) | (100.0%) | | Total | $22,095,596 | $46,514,834 | $(24,419,238) | (52.5%) | Gross Profit (Loss) and Margin (Six Months Ended June 30) | Segment | 2025 Gross Profit (Loss) | 2024 Gross Profit (Loss) | 2025 Gross Margin (%) | 2024 Gross Margin (%) | | :--------------------------------- | :----------------------- | :----------------------- | :-------------------- | :-------------------- | | Mobile Virtual Network Operator | $(5,013,626) | $4,622,200 | (110.0%) | 11.2% | | Point-of-Sale and Prepaid Services | $(583,385) | $116,487 | (3.3%) | 2.3% | | Other Corporate Overhead | $- | $904 | - | 39.2% | | Total | $(5,597,011) | $4,739,591 | (25.3%) | 10.2% | - Selling, general and administrative costs decreased by **$4,970,838** (**37.4%**), driven by reductions in contractors and consultants, professional services (legal fees), and compensation (stock compensation)[385](index=385&type=chunk)[386](index=386&type=chunk) - Interest expense increased to **$331,853** in H1 2025 from **$249,305** in H1 2024, partly due to amortization of debt discount from the convertible note[387](index=387&type=chunk)[388](index=388&type=chunk) [Revenues](index=72&type=section&id=Revenues) [Cost of Revenue, Gross Profit and Gross Margin](index=73&type=section&id=Cost%20of%20Revenue%2C%20Gross%20Profit%20and%20Gross%20Margin) [General and administrative](index=73&type=section&id=General%20and%20administrative) [Other (expense) income](index=75&type=section&id=Other%20%28expense%29%20income) [Provision for income tax benefit (expense)](index=75&type=section&id=Provision%20for%20income%20tax%20benefit%20%28expense%29) [Equity Transactions for the Six Months Ended June 30, 2025](index=75&type=section&id=Equity%20Transactions%20for%20the%20Six%20Months%20Ended%20June%2030%2C%202025) [Segment Information](index=75&type=section&id=Segment%20Information) [LIQUIDITY AND CAPITAL RESOURCES](index=77&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) Working capital significantly decreased to **$0.99 million** by June 30, 2025, with total assets down and liabilities up due to new debt, resulting in **$13.08 million** net cash outflow from operations, prompting management to plan ATM usage and other initiatives Liquidity and Capital Resources Summary | Metric | June 30, 2025 | December 31, 2024 | | :-------------------- | :-------------- | :------------------ | | Current assets | $9,694,382 | $17,870,323 | | Current liabilities | $8,702,069 | $6,059,476 | | Working capital | $992,313 | $11,810,847 | | Total assets | $15,215,409 | $23,976,005 | | Total liabilities | $15,154,017 | $8,714,392 | | Stockholders' equity | $61,392 | $15,261,613 | - Net cash used in operating activities for the six months ended June 30, 2025, was **$13,082,419**[406](index=406&type=chunk) - Management plans to fund operations by * Selectively using the At The Market (ATM) agreement for up to **$15,000,000** * Suspending monthly payments on the related party note * Launching LinkUp Mobile SIM cards and 'phone in a box' programs * Expanding Torch Wireless Lifeline subscriber base in California * Leveraging MVNE solutions for other wireless companies[403](index=403&type=chunk)[412](index=412&type=chunk)[413](index=413&type=chunk) [Critical Accounting Policies and Estimates](index=79&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section details SurgePays' critical accounting policies and estimates, requiring significant management judgment for allowances, inventory, loss contingencies, stock-based compensation, and fair value measurements, adhering to ASC 606 and ASC 718 - Significant estimates include * Allowance for doubtful accounts and other receivables * Inventory reserves and classifications * Valuation of loss contingencies and derivative liabilities * Valuation of stock-based compensation * Estimated useful lives for intangible assets, internal-use software, and property and equipment * Implicit interest rate in right-of-use operating leases * Uncertain tax positions and valuation allowance on deferred tax assets[419](index=419&type=chunk) - The company accounts for revenue under ASC 606, applying a five-step process to recognize revenue when performance obligations are satisfied[428](index=428&type=chunk)[432](index=432&type=chunk) - Stock-based compensation is accounted for under ASC 718 using the fair value-based method, with the Black-Scholes model used for valuing stock options and warrants[429](index=429&type=chunk)[430](index=430&type=chunk)[431](index=431&type=chunk) [ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=83&type=section&id=ITEM%203%3A%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) This section addresses market risk disclosures, stating that there are no applicable quantitative and qualitative disclosures for the reporting period [Market Risk Disclosures](index=83&type=section&id=Market%20Risk%20Disclosures) SurgePays, Inc. reports no applicable quantitative and qualitative disclosures regarding market risk for the current period - Not applicable[435](index=435&type=chunk) [ITEM 4: CONTROLS AND PROCEDURES](index=83&type=section&id=ITEM%204%3A%20CONTROLS%20AND%20PROCEDURES) This section covers the evaluation of SurgePays' disclosure controls and procedures and any changes in internal control over financial reporting [Evaluation of disclosure controls and procedures](index=83&type=section&id=Evaluation%20of%20disclosure%20controls%20and%20procedures) As of June 30, 2025, SurgePays' management determined its disclosure controls and procedures are effective, despite acknowledging a common lack of segregation of duties for a company of its size - As of June 30, 2025, the company's disclosure controls are effective[437](index=437&type=chunk) - The company lacks segregation of duties, similar to other companies of its size[437](index=437&type=chunk) [Changes in Internal Control over Financial Reporting](index=83&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) No material changes in SurgePays' internal controls over financial reporting were identified during the period ended June 30, 2025 - No material changes in internal control over financial reporting were identified during the period ended June 30, 2025[438](index=438&type=chunk) [PART II - OTHER INFORMATION](index=83&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) This section provides additional information including legal proceedings, risk factors, unregistered sales of equity, defaults, mine safety, and other disclosures [ITEM 1: LEGAL PROCEEDINGS](index=83&type=section&id=ITEM%201%3A%20LEGAL%20PROCEEDINGS) SurgePays is involved in several legal proceedings, including a dismissed case, an ongoing district court case after an Oklahoma Supreme Court denial, and an appeal filed by SurgePays against dismissal and summary judgment rulings - The 'Juno Financial v. AATAC and Surge Holdings Inc.' case was dismissed with the agreement of the parties on September 12, 2024[440](index=440&type=chunk) - In 'Blue Skies Connections, LLC, and True Wireless, Inc. v. SurgePays, Inc., et. al.', the Oklahoma Supreme Court denied Plaintiffs' Petition for Certiorari on March 10, 2025, and the case will proceed in the district court on remaining claims[442](index=442&type=chunk) - In 'SurgePays, Inc. et al. v. Fina et al.', SurgePays has filed an appeal of the Court's dismissal and summary judgment rulings against its claims[441](index=441&type=chunk)[442](index=442&type=chunk) [ITEM 1A: RISK FACTORS](index=85&type=section&id=ITEM%201A%3A%20RISK%20FACTORS) SurgePays, Inc. reports no applicable risk factors for the current reporting period - Not applicable[443](index=443&type=chunk) [ITEM 2: UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS](index=85&type=section&id=ITEM%202%3A%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) On May 12, 2025, SurgePays issued a **$6,999,999** Senior Secured Convertible Note to Funicular Funds, LP, yielding **$5,925,000** in net cash proceeds, convertible at **$4.00** per share - On May 12, 2025, the company issued a Senior Secured Convertible Note for **$6,999,999** to Funicular Funds, LP, with net cash proceeds of **$5,925,000**[444](index=444&type=chunk) - The convertible note allows conversion into common stock at an initial price of **$4.00** per share, subject to down-round adjustment[444](index=444&type=chunk) [ITEM 3: DEFAULTS UPON SENIOR SECURITIES](index=85&type=section&id=ITEM%203%3A%20DEFAULTS%20UPON%20SENIOR%20SECURITIES) SurgePays, Inc. reported no defaults on senior securities for the current period - None[445](index=445&type=chunk) [ITEM 4: MINE SAFETY DISCLOSURES](index=85&type=section&id=ITEM%204%3A%20MINE%20SAFETY%20DISCLOSURES) Mine safety disclosures are not applicable to SurgePays, Inc.'s operations - Not applicable[445](index=445&type=chunk) [ITEM 5: OTHER INFORMATION](index=85&type=section&id=ITEM%205%3A%20OTHER%20INFORMATION) For H1 2025, no Rule 10b5-1 trading arrangements were adopted or modified, and the company repurchased **333,333 common shares** for **$999,999** while terminating its share repurchase program - No Rule 10b5-1 trading arrangements were adopted, modified, or terminated by directors or executive officers during the six months ended June 30, 2025[445](index=445&type=chunk) - On May 12, 2025, the company repurchased **333,333 shares** of common stock for **$999,999** (**$3/share**) from a convertible note payable holder[446](index=446&type=chunk) - The share repurchase program was terminated on October 1, 2024, after reacquiring **81,850 shares** for **$146,836**[447](index=447&type=chunk) [ITEM 6: EXHIBITS](index=85&type=section&id=ITEM%206%3A%20EXHIBITS) This section lists the exhibits filed with the Form 10-Q, including Sarbanes-Oxley Act certifications from the CEO and CFO, and Inline XBRL documents - Exhibits include * Certifications pursuant to 18 U.S.C. Section 1350 Section 302 of the Sarbanes-Oxley Act of 2002 from the CEO and CFO * Certifications pursuant to 18 U.S.C. Section 1350 Section 906 of the Sarbanes-Oxley Act of 2002 from the CEO and CFO * Inline XBRL Instance Document and Taxonomy Extension Documents[448](index=448&type=chunk) [SIGNATURES](index=86&type=section&id=SIGNATURES) This section confirms the official signing of the Form 10-Q report by SurgePays, Inc.'s principal executive and financial officers [Signatures](index=86&type=section&id=Signatures) The Form 10-Q report was officially signed on August 13, 2025, by Kevin Brian Cox, CEO, and Anthony Evers, CFO, on behalf of SurgePays, Inc - The report was signed by Kevin Brian Cox, Chief Executive Officer, and Anthony Evers, Chief Financial Officer, on August 13, 2025[452](index=452&type=chunk)

Core Insights - SurgePays, Inc. reported a second quarter revenue of $11.5 million, reflecting an 8.9% sequential increase from $10.6 million in Q1 2025, and is on track for record-breaking results in 2026 due to strong subscriber activations and growth across various platforms [2][8]. Financial Performance - The company expects 2025 revenue to be between $75 million and $90 million, and for 2026, revenue is projected to be between $225 million and $240 million, driven by subscriber growth and new partnerships [3][9]. - In Q2 2025, the company experienced a net loss of $7.08 million, compared to a net loss of $12.87 million in Q2 2024, with total revenues for the first half of 2025 at $22.1 million, down from $46.5 million in the same period of 2024 [17][18]. Subscriber Growth and Business Expansion - SurgePays has seen significant subscriber growth, particularly with its Torch Wireless brand, which activated 20,000 subscribers in June and 57,000 in July, with expectations of reaching 80,000 to 90,000 activations per month by September [5][11]. - The LinkUp Mobile prepaid platform has shipped over 250,000 SIMs, with activations more than doubling to over 30,000 subscribers between April and July 2025 [11]. Operational Highlights - The company completed a nationwide launch on the AT&T network and fully integrated by April 1, 2025, enhancing its service capabilities [11]. - SurgePays has expanded its prepaid POS fintech network, driving recurring revenue from over 9,000 retail locations [11]. Financial Position - As of June 30, 2025, the company reported total assets of $15.2 million, a decrease from $24.0 million at the end of 2024, with current liabilities increasing to $8.7 million from $6.1 million [16][17]. - The company secured $6 million in financing from a large shareholder to accelerate growth initiatives [11].

Core Viewpoint - SurgePays, Inc. is set to release its second quarter 2025 financial results on August 13, 2025, followed by a conference call to discuss these results [1] Company Overview - SurgePays, Inc. operates as a wireless, fintech, and point-of-sale technology company, focusing on providing mobile connectivity and financial services to underserved communities [3] - The company functions as both a mobile virtual network operator (MVNO) and a mobile virtual network enabler (MVNE), managing its own wireless brand and offering back-end infrastructure to other wireless providers [3] - SurgePays has developed a proprietary point-of-sale platform utilized in thousands of retail locations across the nation, facilitating SIM activations, top-ups, and digital financial services [3] - The company is positioned for growth in both retail and wholesale wireless channels, indicating a scalable business model [3]

Summary of the Conference Call Company Overview - The company operates in the prepaid wireless market in the United States, catering to approximately 100 million prepaid wireless subscribers, primarily targeting the blue-collar working class and government-subsidized demographics [3][4] - The company has integrated with AT&T as a Mobile Virtual Network Operator (MVNO), with the MVNO market projected to grow from $30 billion in 2023 to nearly $53 billion by 2031 [4] Distribution and Growth Strategy - The company currently has around 9,000 retail points for distribution, with a goal to expand to over 100,000 stores [6][8] - The target market frequently visits local community stores, which are crucial for the company's distribution strategy [6][7] - The company aims to help store owners increase revenue through transactions and foot traffic [7] Revenue Channels - The company has three main revenue channels from its contract with AT&T: 1. **Prepaid Brand (LinkUp)**: Competing with other prepaid companies like Cricket and Boost [10] 2. **Government Subsidized Channel (Torch Wireless)**: Focused on the Lifeline program, which provides free connectivity to eligible households [11][12] 3. **Wholesale to Other Wireless Companies**: The company is integrating with other MVNOs on its platform [13][14] Financial Performance and Projections - The company is confident in its revenue guidance due to a strong team with extensive experience in the prepaid market [15][16] - The Lifeline program is expected to scale faster than previous programs, with projections for cash flow positivity by the end of 2025 [18][26] - The company is currently seeing subscriber growth in the thousands per day, with a focus on states that offer higher payments under the Lifeline program [24][25][26] Market Dynamics - The prepaid wireless industry is relatively new, having gained significant traction since 2009, indicating potential for continued growth [16] - The company has diversified its revenue streams to avoid reliance on a single channel, which mitigates risks associated with funding uncertainties [21] Future Outlook - The company anticipates exponential growth as it scales its four revenue channels, all of which are recurring revenue models [23][24] - There is a strong emphasis on real-time visibility of growth metrics to keep shareholders informed [24][25] Conclusion - The company is positioned for significant growth in the prepaid wireless market, with a robust strategy to expand its distribution network and diversify its revenue streams, while leveraging its partnership with AT&T to enhance its service offerings and market reach [4][10][21]