NFTG(US:NFTG)2023-11-14 21:00Game Development and User Engagement - As of September 30, 2023, the company launched two games, Space Striker AI and Brawl Bots, enhancing user engagement through unique gameplay experiences[89] - The company aims to develop a robust digital gaming platform, Gaxos, integrating various game genres and NFT features[91] - The company’s NFTs are powered by the Polygon blockchain, providing users with unique in-game assets[90] Financial Position and Cash Management - The company reported approximately $437,000 in cash exceeding FDIC limits of $250,000 as of September 30, 2023[100] - As of September 30, 2023, the Company had cash of $764,977 and short-term investments of $3,570,888, consisting of marketable debt securities[130] - The company held 1,565 units of Polygon (MATIC) as digital currencies as of September 30, 2023, with no holdings as of December 31, 2022[104] Investments and Asset Valuation - The company's short-term investments totaled $3,570,888 as of September 30, 2023, with unrealized gains of $41,841 for the three months ended September 30, 2023[97][103] - The company evaluates its investments for other-than-temporary declines in fair value each quarter, ensuring accurate asset valuation[102] Revenue Recognition and Financial Reporting - The company follows ASC Topic 606 for revenue recognition, ensuring accurate reporting of revenue from customer contracts[109] - The company’s financial statements are prepared in accordance with GAAP and SEC requirements, reflecting its financial condition and operations[93] Research and Development Expenses - The Company reported research and development fees of $258,405 for the three months ended September 30, 2023, an increase of 17.0% compared to $220,902 in the same period of 2022[120] - The Company expects research and development fees to increase in the future as the development of games accelerates[120] Operating Loss and Financial Performance - The Company incurred a net loss of $857,059 for the three months ended September 30, 2023, representing an increase of 162.57% from a net loss of $326,198 in the same period of 2022[129] - The loss from operations for the three months ended September 30, 2023, was $873,616, an increase of 167.5% compared to $326,552 in the same period of 2022[127] - The Company generated a net loss of $3,147,134 for the nine months ended September 30, 2023, compared to a net loss of $1,098,130 for the same period in 2022, an increase of 186.6%[129] - Cash used in operations for the nine months ended September 30, 2023, was $2,307,697, primarily due to the net loss of $3,147,134[133] Financing Activities and Capital Needs - Net cash provided by financing activities for the nine months ended September 30, 2023, was $5,908,760, following an IPO that raised approximately $7 million[137] - The company anticipates needing significant capital to sustain operations and execute its long-term business plan, particularly for new technologies[139] - The company believes that the net proceeds from the IPO that closed in February 2023 will be sufficient to meet its financial obligations for at least the next 12 months[139] Regulatory and Market Considerations - The Inflation Reduction Act of 2022 imposes a new 1% excise tax on stock repurchases by publicly traded U.S. corporations starting January 1, 2023[141] - The company continues to evaluate the impact of the COVID-19 pandemic, noting potential negative effects on its financial position and operations[142] - As of September 30, 2023, the company did not have any off-balance sheet arrangements or commitments[144] - The company intends to rely on exemptions provided under the JOBS Act as an "emerging growth company" until certain revenue or debt thresholds are met[147] Software Development Costs - The company capitalized $24,625 in internal-use software development costs during the three months ended September 30, 2023, to be amortized over 36 months[105]