Financial Performance - Revenues for the second quarter of 2024 were $266,892, an increase of $135,377 or 103% compared to $131,515 in the same period of 2023, attributed to an uptick in political revenue[170] - Cost of revenues was $184,125, representing 69% of revenues in Q2 2024, down from 79% in Q2 2023, indicating improved cost efficiency[171] - Gross profit for Q2 2024 was $82,767, or 31% of revenues, compared to $27,426 or 21% of revenues in Q2 2023, reflecting a significant improvement in profitability[171] - Operating expenses decreased to $1,104,776 in Q2 2024 from $1,537,979 in Q2 2023, a reduction of $433,203, primarily due to lower professional fees and salaries[171] - The loss from operations for Q2 2024 was $1,022,009, a decrease of approximately $489,000 compared to a loss of $1,510,553 in Q2 2023, driven by reduced operating expenses[172] - For the first six months of 2024, revenues were $530,174, an increase of $266,435 or 101% compared to $263,739 in the same period of 2023, again attributed to political revenue growth[175] - Cost of revenues for the first six months of 2024 was $395,394, or 75% of revenues, up from 63% in the same period of 2023, indicating rising costs associated with revenue generation[175] - Gross profit for the first six months of 2024 was $134,780, or 25% of revenues, down from 37% in the same period of 2023, highlighting challenges in maintaining profitability[175] - Operating expenses for the first six months of 2024 were $2,205,887, a decrease of $757,839 from $2,963,726 in the same period of 2023, reflecting cost-cutting measures[176] - The company had cash of $23,892 at June 30, 2024, with cash used in operating activities amounting to $1,336,280 for the first six months of 2024, primarily due to a net loss of $1,787,407[179] Business Operations - The ATOS platform engages with approximately 10 billion advertisement opportunities per day, enhancing speed and performance in digital advertising campaigns[141] - The company generates revenue through licensing platforms as white-label products and a managed services model, with higher fees for managed services[146][147] - The data intelligence platform provides precise data and insights on consumer behavior, utilizing proprietary technologies for data collection and analysis[143] - The publisher platform allows content publishers to monetize user data and advertising inventory while ensuring data privacy compliance[145] - The company aims to become the programmatic display advertising industry standard for small and medium-sized advertisers[146] - The company operates in a highly competitive industry, facing risks such as economic downturns and variability in sales and earnings[150] Compliance and Controls - Revenue recognition is aligned with the delivery of services, following ASC Topic 606, ensuring accurate financial reporting[156] - The company evaluates the recoverability of long-lived assets based on expected cash flows and market conditions[154] - The company does not require collateral for accounts receivable, assessing credit risk based on customer financial conditions[153] - The Company concluded that its disclosure controls and procedures were not effective as of June 30, 2024, primarily due to a lack of segregation of duties in the finance and accounting department[182] - The Company identified control gaps and deficiencies during fiscal 2022 and continues to mitigate these issues, with remediation activities prioritized by the Board of Directors and the Audit Committee[184] - The Company has instituted independent monitoring and testing of internal controls, which will continue into fiscal 2024[184] Legal Matters - A lawsuit was filed by former Co-CEO Michael Trepeta claiming not less than $2.5 million in damages, with the Company believing the claims lack merit and intending to defend vigorously[186] - The Company was notified in December 2023 that its motion to dismiss Mr. Trepeta's action was granted, but he has filed a notice of appeal[186]
Mobiquity Technologies(MOBQ) - 2024 Q2 - Quarterly Report