PSQ (US:PSQH)2025-08-12 20:16PART I—FINANCIAL INFORMATION This part presents the interim condensed consolidated financial statements and management's discussion and analysis for the period ended June 30, 2025 Interim Condensed Consolidated Financial Statements Unaudited interim financials for Q2 2025 show increased revenues, reduced net loss, and a strategic pivot to FinTech Condensed Consolidated Balance Sheets Total assets decreased to $65.5 million by June 30, 2025, driven by reduced cash and equity Condensed Consolidated Balance Sheet Highlights (Unaudited) | Metric | June 30, 2025 ($) | December 31, 2024 ($) | | :--- | :--- | :--- | | Cash and cash equivalents | 20,577,116 | 36,324,354 | | Total current assets | 32,176,723 | 46,837,162 | | Total assets | 65,454,999 | 74,893,841 | | Total current liabilities | 10,851,602 | 8,624,419 | | Total liabilities | 43,003,606 | 48,043,635 | | Total stockholders' equity | 22,451,393 | 26,850,206 | Condensed Consolidated Statements of Operations Q2 2025 revenues grew 18% to $7.1 million, with net loss improving to $8.4 million Q2 Financial Performance (Three Months Ended June 30) | Metric | 2025 ($) | 2024 ($) | YoY Change | | :--- | :--- | :--- | :--- | | Revenues, net | 7,082,868 | 5,985,228 | +18.3% | | Operating loss | (8,056,740) | (14,031,505) | -42.6% | | Net loss | (8,365,980) | (11,235,246) | -25.5% | | Net loss per share | (0.18) | (0.36) | -50.0% | H1 Financial Performance (Six Months Ended June 30) | Metric | 2025 ($) | 2024 ($) | YoY Change | | :--- | :--- | :--- | :--- | | Revenues, net | 13,832,489 | 9,451,117 | +46.4% | | Operating loss | (19,746,078) | (28,939,456) | -31.8% | | Net loss | (12,813,325) | (23,812,077) | -46.2% | | Net loss per share | (0.29) | (0.80) | -63.8% | Condensed Consolidated Statements of Cash Flows H1 2025 saw reduced cash used in operations, but a significant decrease in financing cash Cash Flow Summary (Six Months Ended June 30) | Activity | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Net cash used in operating activities | (11,285,556) | (16,939,551) | | Net cash (used in) provided by investing activities | (4,698,645) | 52,272 | | Net cash provided by financing activities | 278,824 | 8,191,167 | | Net decrease in cash | (15,705,377) | (8,696,112) | Notes to the Unaudited Condensed Consolidated Financial Statements Details business segments, liquidity, a software acquisition, and a strategic pivot to FinTech - The company operates under three segments: Financial Technology (Credova BNPL and PSQ Payments), Marketplace (e-commerce and advertising), and Brands (EveryLife baby products)202224 - Despite a net loss of $12.8 million and negative operating cash flow of $11.3 million for the first six months of 2025, management believes existing cash of $20.6 million is sufficient to fund operations for the next year2728 - In April 2025, the company acquired software assets and intellectual property for $5.1 million (paid in stock and potential earn-outs) to enhance its payment service offerings6263 - Subsequent to the quarter, on August 12, 2025, the company announced a major strategic shift to accelerate FinTech growth by monetizing its Brands segment and pursuing a sale or strategic partnership for its Marketplace segment126 Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses Q2 2025 performance, strategic pivot to FinTech, and liquidity Recent Developments and Strategic Updates Key board appointments and a strategic repositioning to prioritize the FinTech segment - Announced a strategic repositioning to focus on accelerating the growth of the FinTech segment135 - As part of the new strategy, the company plans to monetize its Brands segment and pursue a sale or strategic partnership for its Marketplace segment135 - Appointed Caitlin Long, a renowned Bitcoin and cryptocurrency finance expert, to its Board of Directors to support its Digital Asset Treasury Strategy125133 Results of Operations Q2 2025 revenues increased 18% to $7.1 million, with operating loss reduced by 43% Q2 2025 vs Q2 2024 Performance | Metric | Q2 2025 ($) | Q2 2024 ($) | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenues, net | 7,082,868 | 5,985,228 | 1,097,640 | 18% | | Total costs and expenses | 15,139,608 | 20,016,733 | (4,877,125) | (24)% | | Operating loss | (8,056,740) | (14,031,505) | 5,974,765 | (43)% | | Net loss | (8,365,980) | (11,235,246) | 2,869,266 | (26)% | - General and administrative expenses decreased by $5.0 million (46%) in Q2 2025, primarily due to a $4.3 million reduction in share-based compensation expense related to a modification for the former CFO178 - Sales and marketing expenses decreased by $2.3 million (45%) in Q2 2025, driven by a $1.2 million reduction in advertising campaigns and a $0.9 million decrease in share-based compensation180 Key Business Metrics FinTech credit GMV declined 19%, while PSQ Payments generated $68.2 million in Q2 2025 Financial Technology Segment GMV (Three Months Ended June 30) | Metric | 2025 ($) | 2024 ($) | % Change | | :--- | :--- | :--- | :--- | | GMV - Credit | 10,713,373 | 13,277,530 | (19)% | | GMV - PSQ Payments | 68,171,847 | 0 | 100% | - The decline in GMV-Credit was driven by a slowdown in the firearm retail industry and the company's focus on disciplined underwriting, with U.S. firearm sales falling for the fourth consecutive year in 2024163 Liquidity and Capital Resources Cash decreased to $20.6 million, but management deems it sufficient for the next 12 months - The company had $20.6 million in cash and cash equivalents as of June 30, 2025193 - Net cash used in operating activities was $11.3 million for the six months ended June 30, 2025192 - Management believes existing cash and cash equivalents are sufficient to fund operations and capital needs for the next year195 Quantitative and Qualitative Disclosures About Market Risk As a smaller reporting company, PSQ Holdings, Inc. is exempt from providing this information - The company is a smaller reporting company and is not required to provide information for this item207 Controls and Procedures Disclosure controls were ineffective due to a material weakness, with remediation efforts underway - Management concluded that disclosure controls and procedures were not effective as of June 30, 2025, due to a material weakness in internal control over financial reporting208 - Remediation efforts include enhancing review processes for complex transactions, providing continuing education, automating processes, and hiring additional staff209 PART II—OTHER INFORMATION This part covers legal proceedings, risk factors, and exhibits for the reporting period Legal Proceedings Credova is responding to CFPB inquiries regarding lease products, potentially leading to enforcement - Credova is responding to inquiries from the Consumer Financial Protection Bureau (CFPB) regarding its lease products, which could lead to an enforcement action120 Risk Factors No material changes to risk factors were reported since the prior Annual Report on Form 10-K - No material changes to risk factors were reported since the last Annual Report on Form 10-K213 Exhibits Lists exhibits filed, including corporate governance, material agreements, and certifications