UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarter ended June 30, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-40049 SPRINGBIG HOLDINGS, INC. (Exact name of registrant as specified in its charter) | Delaware | 88-2789488 | | --- | --- | | (State or ...

NEWS RELEASE CONTANGO ORE, INC. Contango Announces Record High $23.0 Million in Income from Operations and $15.9 Million in Net Income for the Quarter Ended June 30, 2025 Rick Van Nieuwenhuyse, President and CEO of the Company, stated, "Production during the second quarter of 2025 continued to exceed quarterly guidance with record high net income of $15.9 million. During the quarter 17,764 ounces of gold was sold with cash costs of $1,416 per ounce of gold sold and all-in-sustaining costs ("AISC") of $1,548 ...

PART I - Financial Information [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) Unaudited financial statements reflect a Q2 2025 net loss of $17.6 million amid rising operating costs and impairment charges Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | July 1, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $2,264 | $1,149 | | Total current assets | $21,266 | $20,192 | | Property and equipment, net | $122,936 | $137,237 | | Total assets | $294,575 | $324,648 | | **Liabilities & Stockholders' Deficit** | | | | Total current liabilities | $68,372 | $65,717 | | Long-term debt, net | $106,441 | $100,742 | | Total liabilities | $325,350 | $330,227 | | Total stockholders' deficit | ($30,775) | ($5,579) | - Total assets decreased from **$324.6 million** at year-end 2024 to **$294.6 million** as of July 1, 2025, while the company's stockholders' deficit widened significantly from **$5.6 million** to **$30.8 million**[13](index=13&type=chunk) Q2 2025 vs Q2 2024 Statement of Operations (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Total revenue | $126,433 | $127,352 | | Total costs and expenses | $141,211 | $138,870 | | Loss from operations | ($14,778) | ($11,518) | | Net loss | ($17,552) | ($13,625) | | Basic and diluted loss per share | ($0.38) | ($0.30) | First Half 2025 vs First Half 2024 Statement of Operations (in thousands, except per share data) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Total revenue | $250,227 | $248,746 | | Total costs and expenses | $271,392 | $264,360 | | Loss from operations | ($21,165) | ($15,614) | | Net loss | ($26,609) | ($19,765) | | Basic and diluted loss per share | ($0.58) | ($0.44) | - The company's net loss widened to **$17.6 million** in Q2 2025 from **$13.6 million** in Q2 2024, driven by higher costs and expenses, particularly restaurant impairments and closure costs[15](index=15&type=chunk) - The total stockholders' deficit increased from **$5.6 million** at the end of 2024 to **$30.8 million** as of July 1, 2025, primarily driven by the **net loss of $26.6 million** incurred during the first half of 2025[18](index=18&type=chunk) Cash Flow Summary for the Two Fiscal Quarters Ended (in thousands) | Cash Flow Activity | July 1, 2025 | July 2, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $3,181 | $11,728 | | Net cash used in investing activities | ($6,318) | ($15,774) | | Net cash provided by financing activities | $4,252 | $2,839 | | **Net increase (decrease) in cash** | **$1,115** | **($1,207)** | - Cash provided by operating activities significantly decreased to **$3.2 million** in the first half of 2025 from **$11.7 million** in the same period of 2024[23](index=23&type=chunk) - As of July 1, 2025, the company operated **453 restaurants** system-wide, consisting of 364 company-owned and 89 franchise locations[26](index=26&type=chunk) - The company had **$108.3 million** of indebtedness outstanding under its A&R Credit Agreement as of July 1, 2025, with interest rates ranging from **8.07% to 10.25%** during the first half of the year[36](index=36&type=chunk)[37](index=37&type=chunk) - In Q2 2025, the company recorded **$11.9 million** in restaurant impairment charges on 15 restaurants, an increase from the **$10.9 million** impairment on 12 restaurants in Q2 2024[47](index=47&type=chunk)[49](index=49&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=19&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Comparable restaurant sales grew 1.5% in Q2 2025, but profitability declined due to higher costs and impairment charges - System-wide comparable restaurant sales increased **1.5%** in Q2 2025, with a **1.5%** increase at company-owned and **1.6%** at franchise-owned restaurants[71](index=71&type=chunk) - The company is responding to macroeconomic uncertainty with a comprehensive menu upgrade, increased marketing, and plans for new value offerings[72](index=72&type=chunk) - The company permanently closed nine company-owned restaurants in the first half of 2025 and anticipates closing an additional **19 to 23 restaurants** during the remainder of the year[77](index=77&type=chunk) - The company uses key metrics including revenue, comparable restaurant sales, average unit volumes (AUVs), and adjusted EBITDA to evaluate performance[78](index=78&type=chunk) - Comparable restaurant sales are a key metric, defined as year-over-year sales comparisons for restaurants open at least 18 full periods[81](index=81&type=chunk) Adjusted EBITDA Reconciliation (in thousands) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Net loss | $(17,552) | $(13,625) | $(26,609) | $(19,765) | | EBITDA | $(7,639) | $(4,151) | $(6,936) | $(877) | | Adjusted EBITDA | $6,016 | $9,195 | $8,420 | $14,695 | Restaurant Contribution Margin | Period | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Restaurant Contribution Margin | 12.8% | 15.5% | 11.6% | 14.4% | - In Q2 2025, total revenue decreased slightly by **0.7%** to **$126.4 million**, while net loss increased by **28.8%** to **$17.6 million** compared to Q2 2024[100](index=100&type=chunk)[101](index=101&type=chunk) - For the first half of 2025, total revenue increased by **0.6%** to **$250.2 million**, while net loss widened by **34.6%** to **$26.6 million** compared to the same period in 2024[113](index=113&type=chunk)[114](index=114&type=chunk) - The company believes it has sufficient cash sources for at least the next twelve months from available cash, its revolving credit facility, and cash flows from operations[125](index=125&type=chunk) - Net cash from operating activities decreased to **$3.2 million** in H1 2025 from **$11.7 million** in H1 2024, primarily due to lower net income adjusted for non-cash items[126](index=126&type=chunk)[127](index=127&type=chunk) - Capital expenditures for fiscal year 2025 are estimated to be between **$12.0 million** and **$13.0 million**[133](index=133&type=chunk) - As of July 1, 2025, the company had a cash balance of **$2.3 million** and **$13.7 million** available for future borrowings under its A&R Credit Agreement[135](index=135&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=34&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company is exposed to market risks from interest rate fluctuations, commodity volatility, and inflation - The company is exposed to interest rate risk on its **$108.3 million** of outstanding variable-rate debt; a **1.0%** change in the effective interest rate would result in an annualized pre-tax interest expense fluctuation of approximately **$1.1 million**[141](index=141&type=chunk) - The company faces commodity price risk for products like food and uses purchasing contracts to manage this risk[142](index=142&type=chunk) - Inflationary factors affecting operations include food, labor, and energy costs, and the company anticipates that inflation may continue to affect its results[143](index=143&type=chunk) [Item 4. Controls and Procedures](index=34&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective - Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of July 1, 2025[145](index=145&type=chunk) - No changes occurred during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[146](index=146&type=chunk) PART II - Other Information [Item 1. Legal Proceedings](index=37&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently a party to any material legal proceedings - As of the report date, the company is not a party to any material legal proceedings[148](index=148&type=chunk) [Item 1A. Risk Factors](index=37&type=section&id=Item%201A.%20Risk%20Factors) The company faces risks from potential Nasdaq delisting and more restrictive future debt covenants - On June 24, 2025, the company received a notice from Nasdaq for non-compliance with the minimum **$1.00 bid price requirement**, giving it 180 days to regain compliance[151](index=151&type=chunk) - Failure to regain compliance with Nasdaq's listing requirements could result in **delisting**, leading to reduced liquidity and difficulty in obtaining future financing[154](index=154&type=chunk) - The company's credit facility covenants become more restrictive beginning in Q4 2025, and non-compliance could trigger **default and debt acceleration**[159](index=159&type=chunk)[160](index=160&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=39&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities during the period - None[162](index=162&type=chunk) [Item 3. Defaults Upon Senior Securities](index=39&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities - None[163](index=163&type=chunk) [Item 4. Mine Safety Disclosures](index=39&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[164](index=164&type=chunk) [Item 5. Other Information](index=39&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted or terminated Rule 10b5-1 trading arrangements during the quarter - No director or officer adopted or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter[165](index=165&type=chunk) [Item 6. Exhibits](index=41&type=section&id=Item%206.%20Exhibits) This section provides an index of exhibits filed with the Form 10-Q

[Q2 2025 Financial & Operational Highlights](index=1&type=section&id=Q2%202025%20Financial%20%26%20Operational%20Highlights) [Key Performance Indicators](index=1&type=section&id=Key%20Performance%20Indicators) For the second quarter of 2025, Binah Capital Group reported a 2% year-over-year revenue increase to $42 million and an 11% growth in Assets Under Management (AuM) to $28 billion. While the GAAP net loss remained stable at $0.7 million, EBITDA, a non-GAAP measure, increased to $1.0 million from $0.6 million in the prior-year period Q2 2025 Key Metrics (Year-over-Year) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $42 million | ~$41.2 million | +2% | | Assets Under Management (AuM) | $28 billion | ~$25.2 billion | +11% | | Gross Profit | $8.8 million | $7.3 million | +21% | | GAAP Net Loss | $0.7 million | $0.7 million | Comparable | | EBITDA (Non-GAAP) | $1.0 million | $0.6 million | +67% | [Management Commentary](index=1&type=section&id=Management%20Commentary) The CEO, Craig Gould, expressed satisfaction with the quarter's strong performance, attributing the growth in revenue and EBITDA to the company's advisor-centric platform and disciplined execution of its strategy. He conveyed confidence in the company's position to capture future growth opportunities and create long-term shareholder value - Management credits the sustained momentum and growth in **revenue** and **EBITDA** to their advisor-centric business model and effective strategic execution[2](index=2&type=chunk) - The company believes its differentiated business model and execution capabilities position it well for **future growth** and **long-term value creation**[2](index=2&type=chunk) [Financial Statements](index=2&type=section&id=Financial%20Statements) [Consolidated Statement of Operations](index=5&type=section&id=Consolidated%20Statement%20of%20Operations) For Q2 2025, total revenues grew 2% YoY to $41.5 million, driven by increases in commissions and advisory fees. Total expenses remained relatively flat, resulting in a stable net loss of $0.7 million, or ($0.04) per share, comparable to the prior-year period. For the six-month period, the company swung to a net income of $0.4 million from a net loss of $2.3 million in the prior year, primarily due to lower professional fees and interest expenses Statement of Operations Summary (in thousands) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | **Total Revenues** | **$41,497** | **$40,648** | **$90,431** | **$82,095** | | Commissions | $33,998 | $33,663 | $75,137 | $68,057 | | Advisory fees | $6,627 | $6,320 | $13,542 | $12,004 | | **Total Expenses** | **$42,058** | **$41,171** | **$89,537** | **$84,062** | | **Net Income (Loss)** | **($654)** | **($736)** | **$378** | **($2,319)** | | EPS (basic and diluted) | ($0.04) | ($0.04) | $0.02 | ($0.18) | [Consolidated Balance Sheet](index=4&type=section&id=Consolidated%20Balance%20Sheet) As of June 30, 2025, the company's total assets increased slightly to $67.8 million from $66.7 million at year-end 2024. Total liabilities also grew to $51.4 million from $50.5 million, primarily due to an increase in accounts payable and accrued expenses. Total stockholders' equity and mezzanine equity saw a modest increase to $16.4 million Balance Sheet Summary (in thousands) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash, cash equivalents and restricted cash | $8,170 | $8,486 | | **Total Assets** | **$67,791** | **$66,677** | | Notes payable, net | $18,620 | $19,561 | | **Total Liabilities** | **$51,404** | **$50,499** | | **Total Stockholders' Equity and Mezzanine Equity** | **$16,387** | **$16,178** | [Liquidity and Capital](index=2&type=section&id=Liquidity%20and%20Capital) The company reported $8.2 million in cash and cash equivalents and $18.6 million in outstanding long-term debt (net of unamortized issuance costs) as of the end of the second quarter of 2025 - As of June 30, 2025, the company held **$8.2 million** in cash and cash equivalents[6](index=6&type=chunk) - Outstanding long-term debt, net of unamortized issuance costs, was **$18.6 million**[6](index=6&type=chunk) [Non-GAAP Financial Measures](index=1&type=section&id=Non-GAAP%20Financial%20Measures) [EBITDA Reconciliation](index=6&type=section&id=EBITDA%20Reconciliation) The company uses EBITDA, a non-GAAP measure defined as net income adjusted for interest, taxes, depreciation, and amortization, to evaluate earnings from operations. For Q2 2025, EBITDA increased to $1.0 million from $0.6 million in Q2 2024. This was derived from a net loss of $0.7 million, adjusted for items including interest expense ($0.5M), share-based compensation ($0.8M), taxes ($0.1M), and D&A ($0.2M) Reconciliation of Net Income to EBITDA (in millions) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) | ($0.7) | ($0.7) | $0.4 | ($2.3) | | Interest expense | $0.5 | $0.8 | $1.1 | $1.9 | | Share-based compensation | $0.8 | - | $0.8 | - | | Provision for income taxes | $0.1 | $0.2 | $0.5 | $0.4 | | Depreciation and amortization | $0.2 | $0.3 | $0.4 | $0.6 | | **EBITDA** | **$1.0** | **$0.6** | **$3.2** | **$0.5** | - EBITDA is presented as management believes it is a **useful metric** for understanding the company's earnings from operations, though it is not a GAAP measure and has limitations[9](index=9&type=chunk)[16](index=16&type=chunk) [Company Information and Disclosures](index=2&type=section&id=Company%20Information%20and%20Disclosures) [About Binah Capital Group](index=2&type=section&id=About%20Binah%20Capital%20Group) Binah Capital Group is a financial services enterprise that operates a network of firms to empower independent financial advisors. It functions as a national broker-dealer aggregator with an innovative hybrid-friendly model, providing Registered Investment Advisors (RIAs) with resources and a platform to manage both commission-based and advisory business - The company's business model is a **national broker-dealer aggregator** focused on empowering independent financial advisors[8](index=8&type=chunk) - Binah utilizes a **hybrid-friendly model** to support RIAs in managing both commission-based and advisory practices[8](index=8&type=chunk) [Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) This section contains standard "safe harbor" language, cautioning investors that the press release includes forward-looking statements regarding the company's financial outlook and strategic initiatives. These statements are subject to numerous risks and uncertainties, such as regulatory compliance, advisor misconduct, investment performance, and market conditions, which could cause actual results to differ materially - The report includes **forward-looking statements** subject to a **'safe harbor' provision**, which are based on assumptions and subject to uncertainties[10](index=10&type=chunk) - Key risks that could affect future results include **regulatory compliance, advisor misconduct, investment performance, and brand reputation**[11](index=11&type=chunk) - The company advises against placing **undue reliance** on these statements and does not intend to update them unless required by law[12](index=12&type=chunk)

Exhibit 99.1 CALIBER REPORTS SECOND QUARTER 2025 RESULTS Company remains on track for its goal of achieving platform adjusted EBITDA profitability in the second half of 2025 SCOTTSDALE, Ariz., August 13, 2025 (GLOBE NEWSWIRE) – Caliber (NASDAQ: CWD; "CaliberCos Inc."), a real estate investor, developer, and asset manager, today reported results for the second quarter ended on June 30, 2025. Second Quarter 2025 Platform Financial Highlights (compared to Second Quarter 2024) Management Commentary "The second ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition period from_______ to _______ Commission file number 001-40760 ATLANTIC INTERNATIONAL CORP. (Exact name of registrant as specified in its charter) (State or other j ...

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Financial Statements](index=4&type=section&id=ITEM%201.%20Financial%20Statements) The unaudited statements show decreased revenue and a reduced net loss, with equity shifting from a deficit to a surplus due to financing Condensed Consolidated Balance Sheet Highlights (Unaudited) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$27,820,287** | **$19,890,327** | | Total Current Assets | $6,450,666 | $4,697,267 | | Goodwill | $8,973,501 | $8,973,501 | | **Total Liabilities** | **$20,714,167** | **$21,218,868** | | Total Current Liabilities | $19,381,882 | $20,819,878 | | **Total Stockholders' Equity (Deficit)** | **$7,106,120** | **$(1,328,541)** | Condensed Consolidated Statements of Operations Highlights (Unaudited) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | **Net Revenues** | $2,251,379 | $3,396,069 | $4,123,080 | $6,972,656 | | **Gross Profit** | $711,552 | $1,558,677 | $1,584,007 | $3,279,413 | | **Loss from Operations** | $(1,985,217) | $(2,302,235) | $(3,981,777) | $(2,526,880) | | **Net Loss** | **$(2,117,862)** | **$(3,510,480)** | **$(4,207,772)** | **$(4,194,215)** | | **Net Loss per Share** | $(0.81) | $(104.18) | $(1.24) | $(123.10) | - Net cash used in operating activities for H1 2025 was **$(6.1) million**, up from $(2.9) million in H1 2024, while net cash from financing activities rose to **$6.5 million** from $3.0 million[19](index=19&type=chunk)[251](index=251&type=chunk)[254](index=254&type=chunk) [Notes to Unaudited Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Key disclosures detail the alleviation of going concern uncertainty, an asset acquisition, and significant financing activities - Management concluded that **substantial doubt about the Company's ability to continue as a going concern has been alleviated** due to a $16.225 million offering and other capital sources[31](index=31&type=chunk)[33](index=33&type=chunk) - On April 1, 2025, the Company acquired intellectual property from Open Daily Technologies Inc for **344,827 shares of common stock valued at $3,000,000**[82](index=82&type=chunk)[83](index=83&type=chunk) - In February 2025, an offering of common stock and pre-funded warrants raised **net proceeds of $6,642,433**[96](index=96&type=chunk)[98](index=98&type=chunk) - In August 2025, a PIPE offering and warrant exercise generated **gross proceeds of $16,225,000**, improving pro forma stockholders' equity to over $33 million[134](index=134&type=chunk)[138](index=138&type=chunk) - The company is involved in a legal dispute over a retail lease with a **claimed amount of $450,968**, reduced from an initial $1.5 million[129](index=129&type=chunk)[273](index=273&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=32&type=section&id=ITEM%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Revenue declined due to a strategic account drop, but net loss improved from reduced operating expenses and recent financing Results of Operations Comparison (Q2 2025 vs Q2 2024) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change | | :--- | :--- | :--- | :--- | | Net Revenues | $2.3 million | $3.4 million | $(1.1) million | | Gross Profit | $0.7 million | $1.6 million | $(0.9) million | | Gross Margin | 32% | 46% | (14 pts) | | Operating Expenses | $2.7 million | $3.8 million | $(1.1) million | | Net Loss | $(2.1) million | $(3.5) million | $1.4 million | - The Q2 2025 revenue decrease was primarily due to dropping a large, low-margin wholesale account, with the impact expected to be offset by expanding another wholesale relationship[230](index=230&type=chunk)[231](index=231&type=chunk) - Operating expenses **decreased by $1.2 million** in Q2 2025 year-over-year following significant headcount reductions, with an additional **$0.7 million in savings anticipated**[235](index=235&type=chunk) - As of June 30, 2025, the company had **$6.4 million in outstanding debt**, mainly from promissory notes, PPP loans, and merchant advances[255](index=255&type=chunk) - The company entered into exclusive private label manufacturing agreements with AAA Tuscaloosa and Traffic Holdco for university apparel subsequent to the reporting period[219](index=219&type=chunk)[222](index=222&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=49&type=section&id=ITEM%203%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company is exempt from market risk disclosures as a smaller reporting company - As a smaller reporting company, Digital Brands Group, Inc. is not required to provide the information for this item[260](index=260&type=chunk) [Controls and Procedures](index=49&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Disclosure controls were deemed ineffective due to material weaknesses in internal controls, with remediation efforts underway - Management concluded that the company's **disclosure controls and procedures were not effective** as of June 30, 2025[262](index=262&type=chunk) - The ineffectiveness stems from **material weaknesses related to inadequate accounting resources and systems**, which are under active remediation[263](index=263&type=chunk)[268](index=268&type=chunk) - No changes occurred during the quarter that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[269](index=269&type=chunk) [PART II. OTHER INFORMATION](index=51&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=51&type=section&id=ITEM%201.%20Legal%20Proceedings) The company is managing several legal matters, including a disputed lease claim and settled vendor and employee lawsuits - A vendor lawsuit concerning a retail lease has an updated claim of **$450,968**, down from $1.5 million, which the company disputes[273](index=273&type=chunk) - A wrongful termination lawsuit was **settled in May 2025 for a payment of $81,000**[273](index=273&type=chunk) - A lawsuit with vendor Simon Showroom was **settled for $400,000**, with a remaining balance of $130,000 as of June 30, 2025[273](index=273&type=chunk) [Risk Factors](index=52&type=section&id=ITEM%201A.%20Risk%20Factors) The company is not required to provide risk factor disclosures due to its status as a smaller reporting company - The company is not required to provide risk factor information as it qualifies as a "smaller reporting company"[275](index=275&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=52&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Equity sales were conducted under exemptions from registration requirements as detailed in the financial statement notes - Details on unregistered sales of equity are located in Note 7 of the financial statements[276](index=276&type=chunk) - The issuances were made under exemptions from registration pursuant to Section 4(a)(2) of the Securities Act and/or Rule 506 of Regulation D[276](index=276&type=chunk) [Defaults upon Senior Securities](index=52&type=section&id=ITEM%203.%20Defaults%20upon%20Senior%20Securities) No defaults upon senior securities were reported during the period - None[277](index=277&type=chunk) [Mine Safety Disclosures](index=52&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosures) Mine safety disclosures are not applicable to the company's operations - Not applicable[278](index=278&type=chunk) [Other Information](index=52&type=section&id=ITEM%205.%20Other%20Information) No material changes to shareholder processes or insider trading plans were reported for the quarter - During the quarter ended June 30, 2025, no director or officer adopted or terminated a Rule 10b5-1 trading plan[280](index=280&type=chunk) [Exhibits](index=52&type=section&id=ITEM%206.%20Exhibits) A list of filed exhibits includes officer certifications and key material agreements - The report includes a list of filed exhibits, such as CEO/CFO certifications and various material agreements[281](index=281&type=chunk) [Signatures](index=54&type=section&id=SIGNATURES)

PART I [Business](index=5&type=section&id=Item%201.%20Business) Connexa Sports Technologies, after divesting its legacy business, now focuses on licensing AI and metaverse matchmaking technology and developing a new social networking vertical - On March 18, 2024, the Company acquired **70% of Yuanyu Enterprise Management Co., Limited (YYEM) for $56 million**, concurrently divesting its legacy "Slinger Bag" business for $1.00, making YYEM its sole operating subsidiary[16](index=16&type=chunk)[17](index=17&type=chunk) - Primary revenue is derived from licensing **six metaverse-related technologies and five AI matchmaking patents**, designed to integrate with major AI models like Huawei Pangu and Baidu Wenxinyiyan[20](index=20&type=chunk)[21](index=21&type=chunk) Fiscal Year 2025 Revenue | Metric | Value | | :--- | :--- | | Royalty Revenue | $12.8 million | - A new social networking vertical was established in February 2025 through an agreement with TikTok to produce content for the MENA region, creating an independent revenue stream[27](index=27&type=chunk) - The company has **three main licensees** for its technology, covering Japan/South Korea, UK/Europe, and Sub-Saharan Africa[35](index=35&type=chunk) [Risk Factors](index=15&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant operational, financial, and regulatory risks, including reliance on licensees, market competition, funding needs, and geopolitical exposure through its Hong Kong subsidiary - A substantial portion of revenue is dependent on intellectual property licensing agreements with third parties, and their failure to perform could significantly impact financial results[61](index=61&type=chunk)[62](index=62&type=chunk) - The love and marriage market is highly competitive with low switching costs for consumers, and competition from large, established players like Facebook's dating feature poses a significant threat[68](index=68&type=chunk)[70](index=70&type=chunk) - The company may require additional financing to fund its working capital needs and growth strategy, with no guarantee of availability on favorable terms[115](index=115&type=chunk)[116](index=116&type=chunk) - Operating a subsidiary in Hong Kong exposes the company to risks from the Chinese government, which could exercise significant oversight and control, potentially impacting operations and stock value[142](index=142&type=chunk)[148](index=148&type=chunk) - The company's former independent auditor, Olayinka Oyebola & Co. (OOC), faces SEC charges, which could impact the credibility of past financial statements for both Connexa and YYEM and potentially require restatements[125](index=125&type=chunk)[127](index=127&type=chunk) - Following the acquisition of YYEM, the former YYEM shareholder owns approximately **55.8% of the company's common stock**, enabling significant influence over corporate matters[161](index=161&type=chunk) [Unresolved Staff Comments](index=36&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) This item is not applicable to the company because it qualifies as a smaller reporting company - Not applicable to smaller reporting companies[178](index=178&type=chunk) [Cybersecurity](index=36&type=section&id=Item%201C.%20Cybersecurity) The company has established a comprehensive cybersecurity risk management framework, managed internally and overseen by the Board, with no material incidents reported for FY2025 - A cybersecurity risk management framework is in place, managed by internal IT staff with oversight from the Board of Directors[180](index=180&type=chunk)[184](index=184&type=chunk) - No cybersecurity incidents occurred during the fiscal year ended April 30, 2025, that resulted in operational interruptions or material impact[183](index=183&type=chunk) [Properties](index=38&type=section&id=Item%202.%20Properties) The company does not own any real estate, leasing its principal office in Hong Kong for HKD 42,000 monthly, with the lease expiring in August 2026 - The company leases its principal office in Hong Kong for **HKD 42,000 per month**, with the lease expiring in August 2026[186](index=186&type=chunk) [Legal Proceedings](index=38&type=section&id=Item%203.%20Legal%20Proceedings) As of the report date, the company was not involved in any pending or threatened legal proceedings expected to materially affect its operations - There are no pending or threatened legal proceedings that could materially affect the company[187](index=187&type=chunk) [Mine Safety Disclosures](index=38&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[189](index=189&type=chunk) PART II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=39&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on Nasdaq under "YYAI" with 509 holders of record as of August 7, 2025, and it has no plans to pay cash dividends, retaining earnings for operations and expansion - The company's common stock is listed on Nasdaq under the symbol **"YYAI"**[192](index=192&type=chunk) - As of August 7, 2025, there were **509 holders of record** of the common stock[193](index=193&type=chunk) - The company has never declared or paid cash dividends and does not anticipate paying any in the near future[194](index=194&type=chunk) [Selected Financial Data](index=39&type=section&id=Item%206.%20Selected%20Financial%20Data) This item is not applicable to the company because it qualifies as a smaller reporting company - Not applicable to smaller reporting companies[200](index=200&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operation](index=40&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operation) For FY2025, revenue increased by 147% to $12.8 million due to new licensing agreements, driving a 145% increase in gross profit and a 71% increase in operating income, while working capital grew 93% despite a decrease in operating cash flow due to increased accounts receivable Results of Operations (FY 2025 vs. FY 2024) | Metric | FY 2025 ($M) | FY 2024 ($M) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | $12.8 | $5.2 | +147% | | Gross Profit | $9.8 | $4.0 | +145% | | Operating Income | $6.6 | $3.9 | +71% | Cash Flow Summary (FY 2025 vs. FY 2024) | Metric | FY 2025 ($M) | FY 2024 ($M) | | :--- | :--- | :--- | | Cash Flow from Operating Activities | ($0.38) | $2.49 | | Cash Flow from Financing Activities | $0.39 | ($2.45) | - Working capital increased by **93% to $16.0 million** as of April 30, 2025, up from $8.2 million a year prior[216](index=216&type=chunk) - The decrease in operating cash flow was primarily driven by a **$10.0 million increase in accounts receivable**, as licensees have up to 90 days after year-end to pay[216](index=216&type=chunk)[218](index=218&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=47&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This item is not applicable to the company because it qualifies as a smaller reporting company - As a smaller reporting company, we are not required to provide this information[250](index=250&type=chunk) [Financial Statements and Supplementary Data](index=47&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data.) This section presents the company's audited consolidated financial statements for FY2025 and FY2024, with an unqualified opinion from Enrome LLP, reflecting the reverse acquisition accounting of YYEM and detailing key financial figures and accounting policies - The financial statements were audited by Enrome LLP, which issued an **unqualified opinion**[256](index=256&type=chunk) - The acquisition of YYEM was accounted for as a "reverse acquisition," with YYEM being the accounting acquirer and Connexa (the legal acquirer) being the accounting acquiree[281](index=281&type=chunk)[282](index=282&type=chunk) Consolidated Balance Sheet Highlights (as of April 30) | Metric | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Total Assets | 32,905,794 | 23,164,682 | | Total Liabilities | 6,487,171 | 1,442,006 | | Total Shareholders' Equity | 26,418,623 | 21,722,676 | Consolidated Statement of Operations Highlights (for the year ended April 30) | Metric | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Revenue | 12,818,182 | 5,195,804 | | Net Income | 4,633,447 | 2,625,554 | | Net Income Attributable to Controlling Interest | 3,491,287 | 2,625,554 | - The company's three largest customers accounted for **100% of total accounts receivable and revenues** for the year ended April 30, 2025[353](index=353&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=71&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) On March 24, 2025, the company dismissed Bush & Associates CPA and engaged Enrome LLP as its new independent registered public accounting firm to improve communication efficiency, with no disagreements on accounting principles or disclosures - The company changed its independent auditor from Bush & Associates CPA to Enrome LLP on **March 24, 2025**[383](index=383&type=chunk) - The reason for the change was to address communication challenges due to the geographic locations of the auditor and management[384](index=384&type=chunk) - There were no disagreements with the former auditor on any matter of accounting principles or practices[385](index=385&type=chunk) [Controls and Procedures](index=71&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of April 30, 2025, with no material changes to internal control over financial reporting during the fiscal year - Management concluded that disclosure controls and procedures were **effective** as of the end of the fiscal year, April 30, 2025[387](index=387&type=chunk) - No material changes to internal control over financial reporting occurred during the year ended April 30, 2025[388](index=388&type=chunk) [Other Information](index=72&type=section&id=Item%209B.%20Other%20Information) This item is not applicable - Not applicable[392](index=392&type=chunk) [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=72&type=section&id=Item%209C.%20Foreign%20Jurisdictions%20that%20Prevent%20Inspection) This item is not applicable - Not applicable[393](index=393&type=chunk) PART III [Directors, Executive Officers and Corporate Governance](index=73&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) This section provides biographical details for the company's executive officers, Thomas Tarala (CEO) and Guibao Ji (CFO), and its five-member Board of Directors, which includes three independent directors and an Audit Committee Financial Expert - The company's executive officers are **Thomas Tarala (CEO)** and **Guibao Ji (CFO)**[396](index=396&type=chunk) - The Board of Directors is composed of **five members, three of whom are independent**[407](index=407&type=chunk)[408](index=408&type=chunk) - Chenlong Liu is qualified as the **Audit Committee Financial Expert**[410](index=410&type=chunk) [Executive Compensation](index=78&type=section&id=Item%2011.%20Executive%20Compensation) Executive compensation for FY2025 and FY2024 is detailed, including CEO Thomas Tarala's $720,000 base salary, $300,000 stock signing bonus, and $1,000,000 merger success fee, and CFO Guibao Ji's $250,000 annual salary, with director compensation now a $15,000 quarterly cash payment Executive Compensation (FY 2025) | Name and Principal Position | Salary ($) | Share Awards ($) | Total ($) | | :--- | :--- | :--- | :--- | | Thomas Tarala (CEO) | 320,000 | 1,300,000 | 1,620,000 | | Guibao Ji (CFO) | 111,111 | - | 111,111 | - CEO Thomas Tarala's employment agreement includes a base salary of **$720,000**, a **$300,000 signing bonus** in common stock, and a **$1,000,000 success fee** related to the YYEM merger[429](index=429&type=chunk) - CFO Guibao Ji's employment agreement provides for an annual salary of **$250,000** and a discretionary bonus[436](index=436&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=81&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) As of August 7, 2025, director Hongyu Zhou was the largest beneficial owner, holding 55.81% of the company's common stock, representing the entire ownership of all current officers and directors as a group, with 1,500,000 shares available for future issuance under the 2020 Global Share Incentive Plan Security Ownership of Major Shareholders and Management | Name | of Shares | % of Class | | :--- | :--- | :--- | | Hongyu Zhou (Director) | 8,127,572 | 55.81% | | All current officers and directors as a group (5 persons) | 8,127,572 | 55.81% | - The 2020 Global Share Incentive Plan has **1,500,000 shares of common stock** available for issuance[449](index=449&type=chunk) [Certain Relationships and Related Transactions and Director Independence](index=82&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%20and%20Director%20Independence) The company has significant related-party transactions with director Hongyu Zhou, including a $2,827,528 contingent receivable from his guarantee on an investment and a $775,406 payable to him for covered expenses - Director Hongyu Zhou has provided a guarantee on the value of the company's investment in Brightstar Technology Group, creating a contingent receivable of **$2,827,528** as of April 30, 2025[450](index=450&type=chunk) - As of April 30, 2025, the company had a payable of **$775,406** to Mr. Zhou for expenses he covered on behalf of the company[451](index=451&type=chunk) [Principal Accountant Fees and Services](index=82&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) The company incurred $200,000 in audit fees for fiscal year 2025 and $120,000 for fiscal year 2024 from its principal independent accountants, with no other fees paid for tax or other services in either year Accountant Fees | Fee Type | Fiscal 2025 ($) | Fiscal 2024 ($) | | :--- | :--- | :--- | | Audit Fees | 200,000 | 120,000 | | Tax Fees | 0 | 0 | | All Other Fees | 0 | 0 | | **Total** | **200,000** | **120,000** | PART IV [Exhibits, Financial Statement Schedules](index=83&type=section&id=Item%2015.%20Exhibit%20and%20Financial%20Statement%20Schedules) This section incorporates the company's financial statements by reference and provides a comprehensive list of all exhibits filed as part of the Annual Report on Form 10-K, including key corporate documents and material agreements - This section lists all exhibits filed with the Form 10-K, including key corporate documents and material contracts[456](index=456&type=chunk)

Part I [Item 1. Business](index=5&type=section&id=Item%201.%20Business) Connexa's operations now focus on licensing AI-powered matchmaking and metaverse technology, generating **$12.8 million** in FY2025 royalties, after acquiring YYEM and divesting its legacy business - The company completed the acquisition of a 70% stake in Yuanyu Enterprise Management Co., Limited (YYEM) for a combined **$56 million**, making YYEM its sole operating subsidiary. Concurrently, it sold its legacy "Slinger Bag" business for **$1.00**[16](index=16&type=chunk)[17](index=17&type=chunk) - The core business is licensing its portfolio of six metaverse-related technologies and five AI matchmaking patents to partners worldwide. The AI technology is designed to integrate with major Big Data models like those from Huawei, Baidu, and Alibaba[18](index=18&type=chunk)[20](index=20&type=chunk) Fiscal Year 2025 Revenue | Metric | Value (USD) | | :--- | :--- | | Royalties Generated | $12.8 million | - A new social networking vertical was launched via a Multi-Channel Network (MCN) agreement with TikTok in February 2025 to create and sell content for users in the Middle East and North Africa (MENA) region[27](index=27&type=chunk) - The company has three main licensees for its technology, covering Japan/South Korea, UK/Europe, and Sub-Saharan Africa[35](index=35&type=chunk) - On July 9, 2025, the company received a notice of non-compliance from Nasdaq regarding the composition of its Board and Audit Committee, and has a cure period to regain compliance[54](index=54&type=chunk)[55](index=55&type=chunk)[56](index=56&type=chunk) [Item 1A. Risk Factors](index=15&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant business, Hong Kong, and stock ownership risks, including licensee dependence, regulatory uncertainties, and potential Nasdaq delisting - A substantial portion of revenue is dependent on intellectual property licensing agreements with third parties, and the failure of these licensees to perform could significantly impact financial results[61](index=61&type=chunk)[62](index=62&type=chunk) - The love and marriage market is highly competitive with low switching costs. Competitors, including large social media companies like Facebook, could leverage their existing user bases to gain an advantage[68](index=68&type=chunk)[70](index=70&type=chunk) - The company faces risks related to doing business in Hong Kong, including potential oversight from the Chinese government, uncertainty regarding PRC laws on data security and overseas listings, and the impact of the Hong Kong National Security Law[142](index=142&type=chunk)[147](index=147&type=chunk)[156](index=156&type=chunk) - The company is not currently in compliance with Nasdaq Listing Rule 5605 for board and audit committee independence, which could lead to delisting if not cured within the provided timeframe[162](index=162&type=chunk)[164](index=164&type=chunk) - A single shareholder, Hongyu Zhou, beneficially owns approximately **55.8%** of the company's outstanding common stock, giving him significant influence over corporate matters[161](index=161&type=chunk)[175](index=175&type=chunk) - The company's former independent auditor, Olayinka Oyebola & Co. (OOC), has been charged by the SEC, which could impact the credibility of past financial statements for both the company and its subsidiary YYEM[125](index=125&type=chunk)[127](index=127&type=chunk) [Item 1B. Unresolved Staff Comments](index=36&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) This section is not applicable as the company is a smaller reporting company - Not applicable to smaller reporting companies[178](index=178&type=chunk) [Item 1C. Cybersecurity](index=36&type=section&id=Item%201C.%20Cybersecurity) The company maintains an internally managed cybersecurity risk framework with Board oversight, reporting no material incidents in FY2025 - The company has an internally managed cybersecurity risk management framework integrated into its overall enterprise risk management system[180](index=180&type=chunk) - The Board of Directors oversees the cybersecurity risk profile and receives timely information regarding any significant incidents[184](index=184&type=chunk) - There were no cybersecurity incidents during the fiscal year ended April 30, 2025, that resulted in a material impact on the company's business, financial condition, or results of operations[183](index=183&type=chunk) [Item 2. Properties](index=38&type=section&id=Item%202.%20Properties) The company leases its principal office in Hong Kong for approximately **$5,400** monthly, with the lease expiring in August 2026 - The company's principal office is located at Rm. 3212, Tower 1, The Gateway, Harbour City, 25 Canton Road, Tsim Sha Tsui, Kowloon, Hong Kong[186](index=186&type=chunk) - The company leases approximately 800 square feet for HKD42,000 (approx. **$5,400**) per month, with the lease expiring on August 3, 2026[186](index=186&type=chunk) [Item 3. Legal Proceedings](index=38&type=section&id=Item%203.%20Legal%20Proceedings) The company is not currently involved in any material pending or threatened legal proceedings - There were no pending or threatened legal proceedings that could reasonably be expected to have a material effect on the Company's results of operations[187](index=187&type=chunk) [Item 4. Mine Safety Disclosures](index=38&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section is not applicable to the company - Not applicable[189](index=189&type=chunk) Part II [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=39&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on Nasdaq under 'YYAI', with no cash dividends paid or planned, and maintains an equity incentive plan - The company's common stock is listed on Nasdaq under the symbol "YYAI". As of August 7, 2025, there were **14,563,019** shares outstanding[6](index=6&type=chunk)[192](index=192&type=chunk) - The company has never declared or paid cash dividends and does not plan to in the near future[194](index=194&type=chunk) - On November 21, 2024, the Company issued **8,127,572** shares of common stock to complete the acquisition of a 70% ownership stake in YYEM[198](index=198&type=chunk) [Item 6. Selected Financial Data](index=39&type=section&id=Item%206.%20Selected%20Financial%20Data) This section is not applicable as the company is a smaller reporting company - Not applicable to smaller reporting companies[200](index=200&type=chunk) [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operation](index=40&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operation) FY2025 saw significant revenue and gross profit growth driven by licensing, though increased G&A expenses led to a net cash outflow from operations Results of Operations (Year Ended April 30) | | 2025 | 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | $12,818,182 | $5,195,804 | $7,622,378 | 147% | | **Gross Profit** | $9,841,259 | $4,018,881 | $5,822,378 | 145% | | **Operating Income** | $6,659,857 | $3,854,505 | $2,725,352 | 71% | - Revenue growth was driven by royalty income from new licensees following agreements made in January 2024[213](index=213&type=chunk) - General and administrative expenses increased significantly by **$3.1 million (1,884%)** due to business growth and costs related to YYEM becoming a Nasdaq-listed company's operating subsidiary, including audit fees, legal fees, and D&O compensation[215](index=215&type=chunk) Cash Flow Summary (Year Ended April 30) | | 2025 | 2024 | | :--- | :--- | :--- | | **Net cash (used in)/provided by Operating Activities** | $(379,388) | $2,486,255 | | **Net cash (used in)/provided by Financing Activities** | $394,781 | $(2,446,904) | - Working capital increased by **93%** to **$16.0 million** as of April 30, 2025, largely due to a **$10.0 million** increase in accounts receivable[216](index=216&type=chunk) [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=47&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section is not required as the company is a smaller reporting company - As a smaller reporting company, we are not required to provide this information[250](index=250&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=47&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) FY2025 financial statements show **$32.9 million** in total assets and **$4.6 million** net income, reflecting YYEM reverse acquisition accounting and significant customer concentration Consolidated Balance Sheet Highlights (As of April 30) | | 2025 | 2024 | | :--- | :--- | :--- | | **Total Current Assets** | $22,396,159 | $9,678,124 | | **Total Assets** | $32,905,794 | $23,164,682 | | **Total Current Liabilities** | $6,487,171 | $1,442,006 | | **Total Shareholders' Equity** | $26,418,623 | $21,722,676 | Consolidated Statement of Operations Highlights (Year Ended April 30) | | 2025 | 2024 | | :--- | :--- | :--- | | **Revenue** | $12,818,182 | $5,195,804 | | **Net Income** | $4,633,447 | $2,625,554 | | **Net income per share - basic** | $0.36 | $0.23 | - The acquisition of YYEM was accounted for as a "reverse acquisition," with YYEM deemed the accounting acquirer. The consolidated financial statements represent a continuation of YYEM's financial statements[281](index=281&type=chunk)[282](index=282&type=chunk) - The company has a significant customer concentration risk. For the year ended April 30, 2025, three major customers accounted for **100%** of total accounts receivable and **100%** of total revenues[350](index=350&type=chunk)[353](index=353&type=chunk) - On June 30, 2025, the company entered into a securities purchase agreement for a private placement to raise gross proceeds of **$4.6 million** through the sale of **20 million** units at **$0.23** per unit[381](index=381&type=chunk) [Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=71&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company changed its independent auditor to Enrome LLP in March 2025 due to geographical challenges, reporting no disagreements with the former firm - On March 24, 2025, the company engaged Enrome LLP as its independent registered public accounting firm, dismissing Bush & Associates CPA (B&A)[383](index=383&type=chunk) - The company stated there were no disagreements with the former auditor, B&A, on any matter of accounting principles, financial statement disclosure, or auditing scope[385](index=385&type=chunk) [Item 9A. Controls and Procedures](index=71&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of April 30, 2025, with no material changes to internal controls during the fiscal year - Based on an evaluation as of the end of the period, the Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of April 30, 2025[387](index=387&type=chunk) - There were no material changes to the company's internal control over financial reporting during the year ended April 30, 2025[388](index=388&type=chunk) [Item 9B. Other Information](index=72&type=section&id=Item%209B.%20Other%20Information) This section is not applicable - Not applicable[392](index=392&type=chunk) [Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=72&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections) This section is not applicable - Not applicable[393](index=393&type=chunk) Part III [Item 10. Directors, Executive Officers and Corporate Governance](index=73&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) The company's leadership includes CEO Thomas Tarala and CFO Guibao Ji, with a five-member Board of Directors, including independent members and an Audit Committee Financial Expert - The executive officers are Thomas Tarala (CEO) and Guibao Ji (CFO). The board of directors consists of Thomas Tarala, Hongyu Zhou, Chenlong Liu, and Kong Liu[396](index=396&type=chunk) - The Board is composed of five members, with Chenlong Liu and Kong Liu determined to be independent directors[407](index=407&type=chunk)[408](index=408&type=chunk) - Chenlong Liu is qualified as the Audit Committee Financial Expert[410](index=410&type=chunk) [Item 11. Executive Compensation](index=78&type=section&id=Item%2011.%20Executive%20Compensation) FY2025 CEO compensation totaled **$1.62 million**, including salary and share awards, while director compensation was set at **$15,000** cash per quarter FY2025 Named Executive Officer Compensation | Name and Principal Position | Salary ($) | Share Awards ($) | Total ($) | | :--- | :--- | :--- | :--- | | Thomas Tarala (CEO) | 320,000 | 1,300,000 | 1,620,000 | | Guibao Ji (CFO) | 111,111 | - | 111,111 | - CEO Thomas Tarala's employment agreement includes a **$720,000** annual base salary, a **$300,000** stock signing bonus, and a **$1.0 million** success fee related to the YYEM merger[429](index=429&type=chunk) - CFO Guibao Ji's employment agreement includes an annual salary of **$250,000** and a discretionary bonus[436](index=436&type=chunk) - Director compensation was set at **$15,000** cash per quarter, retroactive to each director's appointment[417](index=417&type=chunk) [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=81&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Director Hongyu Zhou beneficially owns **55.81%** of the common stock, making him the largest shareholder, with **1,500,000** shares available under the incentive plan Security Ownership of Major Shareholders and Management | Name | of Shares | % of Class | | :--- | :--- | :--- | | Hongyu Zhou (Director) | 8,127,572 | 55.81% | | All current officers and directors as a group (5 persons) | 8,127,572 | 55.81% | - Percentages are based on **14,563,019** shares of Common Stock outstanding as of August 7, 2025[443](index=443&type=chunk) - The company has **1,500,000** shares of common stock available for issuance under its 2020 Global Share Incentive Plan[449](index=449&type=chunk) [Item 13. Certain Relationships and Related Transactions and Director Independence](index=82&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%20and%20Director%20Independence) Director Hongyu Zhou provided a **$4.2 million** guarantee on an investment, resulting in a **$2.8 million** contingent receivable and a **$775,406** payable to him as of April 30, 2025 - Director Hongyu Zhou has provided a guarantee on the value of the company's investment in Brightstar Technology Group Co., Ltd., obligating him to compensate for any decline below a guaranteed amount of **$4,210,385** upon sale[450](index=450&type=chunk) - As of April 30, 2025, the company had a contingent receivable of **$2,827,528** from Mr. Zhou related to the guarantee and a payable of **$775,406** to Mr. Zhou for reimbursed expenses[450](index=450&type=chunk)[451](index=451&type=chunk) [Item 14. Principal Accountant Fees and Services](index=82&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) Audit fees from independent accountants increased to **$200,000** in FY2025 from **$120,000** in FY2024, with no other service fees incurred Accountant Fees | | Fiscal 2025 | Fiscal 2024 | | :--- | :--- | :--- | | Audit Fees | $200,000 | $120,000 | | Tax Fees | $0 | $0 | | All Other Fees | $0 | $0 | | **Total** | **$200,000** | **$120,000** | Part IV [Item 15. Exhibit and Financial Statement Schedules](index=83&type=section&id=Item%2015.%20Exhibit%20and%20Financial%20Statement%20Schedules) This section lists all exhibits and incorporates financial statements by reference, including corporate governance documents, material contracts, and SEC certifications - This section lists the financial statements and exhibits filed with the Form 10-K, including corporate governance documents, material contracts, and SEC certifications[455](index=455&type=chunk)[456](index=456&type=chunk)

Part I: [Financial Information](index=5&type=section&id=Part%20I%20FINANCIAL%20INFORMATION) This section presents unaudited financial statements and management's analysis of financial condition and operations [Item 1. Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20%28Unaudited%29) This section presents the unaudited condensed financial statements for the quarterly period ended June 30, 2025. It includes the balance sheets, statements of operations, statements of stockholders' equity, and statements of cash flows, along with accompanying notes that provide detailed explanations of the company's accounting policies and financial data [Condensed Balance Sheets](index=5&type=section&id=Condensed%20Balance%20Sheets) This section details the company's financial position, including assets, liabilities, and stockholders' equity Condensed Balance Sheet Summary (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$600,778** | **$678,429** | | Cash and cash equivalents | $250,549 | $349,282 | | Accounts receivable, net | $208,976 | $220,883 | | **Total Liabilities** | **$246,650** | **$221,146** | | User redemption liability | $70,922 | $74,006 | | **Total Stockholders' Equity** | **$354,128** | **$457,283** | - Total assets decreased primarily due to a reduction in cash and cash equivalents, while total stockholders' equity declined significantly, driven by a large increase in treasury stock from **$31.3 million** to **$172.9 million** due to share repurchases[16](index=16&type=chunk) [Condensed Statements of Operations](index=6&type=section&id=Condensed%20Statements%20of%20Operations) This section presents the company's financial performance, including revenue, expenses, and net income or loss Statement of Operations Summary (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | **$86,029** | **$87,926** | **$170,603** | **$170,253** | | Gross Profit | $68,104 | $75,643 | $135,586 | $147,455 | | Income (Loss) from Operations | $1,238 | $(21,657) | $(1,565) | $(5,752) | | **Net Income (Loss)** | **$2,490** | **$(33,966)** | **$3,045** | **$(24,669)** | | Diluted EPS | $0.08 | $(1.32) | $0.10 | $(1.41) | - The company shifted from a significant net loss in Q2 and H1 2024 to a net income in the same periods of 2025, despite relatively flat revenue. This was primarily driven by a substantial reduction in operating expenses, particularly in Sales and Marketing[18](index=18&type=chunk) [Condensed Statements of Cash Flows](index=9&type=section&id=Condensed%20Statements%20of%20Cash%20Flows) This section details cash flows from operating, investing, and financing activities Cash Flow Summary for Six Months Ended June 30 (in thousands) | Cash Flow Category | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $45,715 | $54,386 | | Net cash used in investing activities | $(11,968) | $(4,789) | | Net cash (used in) provided by financing activities | $(132,830) | $205,670 | | **Net change in cash** | **$(99,083)** | **$255,267** | - Financing activities resulted in a significant cash outflow of **$132.8 million** in H1 2025, mainly due to **$140.2 million** in treasury stock purchases. This contrasts sharply with H1 2024, which saw a **$205.7 million** cash inflow from the company's IPO[30](index=30&type=chunk) [Notes to the Condensed Financial Statements (Unaudited)](index=11&type=section&id=Notes%20to%20the%20Condensed%20Financial%20Statements%20%28Unaudited%29) This section provides detailed explanations of accounting policies, significant transactions, and financial data - The company's primary revenue source is fees from CPG brands when consumers redeem digital promotions through the Ibotta Performance Network (IPN)[34](index=34&type=chunk) - In April 2024, upon the IPO, the company's convertible notes automatically converted to Class A common stock, resulting in a **$9.6 million** loss on debt extinguishment[65](index=65&type=chunk) - A securities class action complaint was filed against the company on April 17, 2025, alleging false and misleading statements in the IPO registration statement. The company intends to defend the case vigorously[128](index=128&type=chunk)[130](index=130&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial performance and condition, focusing on key operational metrics, results of operations for the three and six months ended June 30, 2025 compared to 2024, and liquidity and capital resources. The analysis highlights a strategic shift with growth in third-party publisher revenue offsetting a decline in direct-to-consumer (D2C) revenue, and a significant use of cash for share repurchases [Financial and Operational Highlights](index=28&type=section&id=Financial%20and%20Operational%20Highlights) This section details Financial and Operational Highlights Key Metrics Comparison (in thousands, except per-unit data) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Redemptions | 80,484 | 80,715 | 163,324 | 152,181 | | Redeemers | 17,336 | 13,702 | 17,213 | 13,095 | | Redemptions per redeemer | 4.6 | 5.9 | 9.5 | 11.6 | | Revenue | $86,029 | $87,926 | $170,603 | $170,253 | | Net Income (Loss) | $2,490 | $(33,966) | $3,045 | $(24,669) | | Adjusted EBITDA | $17,882 | $25,274 | $32,555 | $47,933 | - While total redeemers grew significantly year-over-year, redemptions per redeemer declined, indicating lower engagement per user. Adjusted EBITDA also saw a notable decrease in both the three and six-month periods[137](index=137&type=chunk) [Performance Metrics](index=29&type=section&id=Performance%20Metrics) This section details Performance Metrics - The company's growth is driven by its third-party publisher network, which saw redeemers increase from **11.9 million** to **15.7 million** in Q2 YoY[142](index=142&type=chunk)[152](index=152&type=chunk) - Conversely, the direct-to-consumer (D2C) segment experienced a decline, with D2C redeemers falling from **1.8 million** to **1.6 million** in Q2 YoY, attributed to the quantity and quality of available offers[142](index=142&type=chunk)[151](index=151&type=chunk) - Growth in third-party publisher redemptions was primarily driven by the launch of new partners, including Family Dollar, Instacart, and DoorDash[147](index=147&type=chunk) [Results of Operations](index=36&type=section&id=Results%20of%20Operations) This section details Results of Operations Revenue Breakdown - Q2 2025 vs Q2 2024 (in thousands) | Revenue Source | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total D2C Revenue | $37,441 | $46,275 | $(8,834) | (19)% | | Total Third-Party Publishers Revenue | $48,588 | $41,651 | $6,937 | 17% | | **Total Revenue** | **$86,029** | **$87,926** | **$(1,897)** | **(2)%** | - Sales and marketing expenses for Q2 2025 decreased by **$21.2 million** (42%) compared to Q2 2024, mainly due to a **$21.9 million** reduction in stock-based compensation expense, a significant portion of which was related to the Walmart Warrant[189](index=189&type=chunk) - Cost of revenue increased by **$5.6 million** (46%) in Q2 2025 compared to Q2 2024, primarily due to the addition of new third-party publishers[188](index=188&type=chunk) [Liquidity and Capital Resources](index=44&type=section&id=Liquidity%20and%20Capital%20Resources) This section details Liquidity and Capital Resources - As of June 30, 2025, principal sources of liquidity were **$250.5 million** in cash and cash equivalents and **$99.0 million** available under a revolving credit facility[208](index=208&type=chunk) - The Board of Directors has authorized a Share Repurchase Program of up to **$300 million**. During the six months ended June 30, 2025, the company repurchased **$141.6 million** of its Class A common stock[214](index=214&type=chunk)[216](index=216&type=chunk) - The company has non-cancelable purchase obligations of **$148.2 million** and operating lease obligations of **$37.5 million** as of June 30, 2025[223](index=223&type=chunk)[224](index=224&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=46&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company identifies its primary market risks as interest rate risk and inflation risk. Interest rate risk pertains to fluctuations on its cash holdings and potential future debt. Inflation risk could increase operating costs. Management states that neither of these risks has had a material effect on the business to date - The company is exposed to interest rate risk on its **$250.6 million** in cash, cash equivalents, and restricted cash, and on its floating-rate credit line, which had no outstanding balance as of June 30, 2025[231](index=231&type=chunk)[232](index=232&type=chunk) - Management does not believe that inflation has had a material effect on the business, but acknowledges that significant inflationary pressures on costs could harm the business if they cannot be offset[233](index=233&type=chunk) [Item 4. Controls and Procedures](index=47&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and interim CFO, evaluated the company's disclosure controls and procedures and concluded they were effective at a reasonable assurance level as of June 30, 2025. There were no material changes to the company's internal control over financial reporting during the quarter - Based on an evaluation as of the end of the period, the principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective[234](index=234&type=chunk) - No changes in internal control over financial reporting occurred during the quarter ended June 30, 2025, that have materially affected, or are reasonably likely to materially affect, internal controls[235](index=235&type=chunk) Part II: [Other Information](index=47&type=section&id=Part%20II%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, equity transactions, and other disclosures [Item 1. Legal Proceedings](index=47&type=section&id=Item%201.%20Legal%20Proceedings) The company reports it is a defendant in a consolidated putative securities class action lawsuit filed in April and May 2025. The complaints allege violations of the Securities Act and Exchange Act related to materially false and misleading statements in the company's IPO registration statement and subsequent public statements. The company intends to defend the case vigorously but cannot estimate a range of potential loss - Two putative securities class action complaints were filed against the company, its officers, directors, and IPO underwriters in April and May 2025, which have since been consolidated[239](index=239&type=chunk) - The lawsuits allege materially false and misleading statements in the IPO registration statement regarding risks, data measurement tools, the D2C platform, and client budgets. The company intends to defend itself vigorously[239](index=239&type=chunk) [Item 1A. Risk Factors](index=49&type=section&id=Item%201A.%20Risk%20Factors) This section outlines significant risks that could adversely affect the company's business, financial condition, and stock price. Key risks highlighted include a history of net losses, dependence on key publishers (like Walmart) and CPG brands, potential failure to sustain revenue growth, intense competition, macroeconomic pressures, and risks associated with the dual-class stock structure which concentrates voting power with the CEO - The company has a history of net losses and an accumulated deficit of **$137.4 million** as of June 30, 2025, with an expectation of increasing future expenses[244](index=244&type=chunk) - A substantial portion of the company's white-label redemptions originate from its relationship with Walmart. The termination or non-renewal of the Walmart Program Agreement could materially and adversely affect the business[252](index=252&type=chunk) - The dual-class stock structure concentrates approximately **71.4%** of the voting power with Founder and CEO Bryan Leach as of June 30, 2025, allowing him to control stockholder decisions[422](index=422&type=chunk) [Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=98&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%2C%20Use%20of%20Proceeds%2C%20and%20Issuer%20Purchases%20of%20Securities) This section provides details on the company's repurchases of its Class A common stock during the second quarter of 2025. The repurchases were made under a board-authorized Share Repurchase Program, which was increased to a total of $300 million Share Repurchase Activity - Q2 2025 | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 2025 | 1,043,146 | $45.77 | | May 2025 | 345,227 | $48.56 | | June 2025 | 60,000 | $49.44 | | **Total** | **1,448,373** | **N/A** | - The total authorization under the Share Repurchase Program was increased to **$300 million** after the board approved an additional **$100 million** in both March and June 2025[455](index=455&type=chunk) [Item 5. Other Information](index=98&type=section&id=Item%205.%20Other%20Information) This section discloses the adoption of Rule 10b5-1 trading plans by certain executive officers during the quarter. CEO Bryan Leach and Chief People Officer Marisa Daspit both established such plans in May 2025 to facilitate the sale of company stock - On May 19, 2025, CEO Bryan Leach and his family trusts adopted a Rule 10b5-1 trading plan for the sale of up to **281,532** shares of Class A common stock, plus additional shares related to vested RSUs[459](index=459&type=chunk) - On May 29, 2025, Chief People Officer Marisa Daspit adopted a Rule 10b5-1 trading plan for the sale of up to **51,625** shares of Class A common stock[461](index=461&type=chunk) [Other Items (Defaults, Mine Safety, Exhibits)](index=98&type=section&id=Other%20Items) This section covers standard reporting items including defaults, mine safety disclosures, and filed exhibits - The company reported no defaults upon senior securities and had no mine safety disclosures to report for the period[457](index=457&type=chunk)[458](index=458&type=chunk)