Taxation – Page 93 – NewzIntel.com

MIL-OSI Security: California Woman Sentenced to Federal Prison for Stealing Nearly $2 Million in Two Separate Fraud Schemes

Source: Office of United States Attorneys

PORTLAND, Ore.—A California woman was sentenced to federal prison today for stealing nearly $1.3 million in Covid-relief program funds and failing to pay the IRS more than $700,000 in payroll taxes she collected from the employees of a small business in Salem, Oregon.

Jamie McGowen, 43, was sentenced to 37 months in federal prison and five years’ supervised release. She was also ordered to pay $2,072,860 in restitution to the IRS and U.S. Small Business Administration (SBA).

According to court documents, McGowen was the owner or partial owner of nine separate companies including Salem Outsourcing, Inc., a payroll processing company based in Salem. Between August 2016 and December 2019, McGowen provided payroll processing services to a small business also located in Salem. During this time, she failed to pay the IRS $705,613 in payroll taxes she withheld from the paychecks of the company’s employees. Instead, McGowen kept the money for herself and used a portion of the funds to, among other things, purchase a 100% ownership stake in the same company whose payroll taxes she had stolen.

In a separate scheme, between April 2020 and December 2021, McGowen stole more than $1.2 million from federal relief programs intended to help small businesses during the Covid-19 pandemic, including the Paycheck Protection Program, Economic Injury Disaster Loan program, and Restaurant Revitalization Fund. McGowen made numerous false statements in 15 separate loan applications, including by stating she did not own any other company, inflating the number of employees and revenues, and providing false tax documents. McGowen also falsely claimed on loan forgiveness applications that her companies had used the funds received for payroll. In reality, McGowen transferred the money around her businesses, to her father, and to her personal checking account, and paid off personal credit cards.

On October 12, 2022, a federal grand jury in Portland returned a seven-count indictment charging McGowen with wire fraud, bank fraud, and money laundering. On December 11, 2024, she pleaded guilty to one count each of wire fraud and bank fraud, and two counts of money laundering.

This case was investigated by the SBA Office of Inspector General (SBA-OIG) and IRS Criminal Investigation (IRS-CI). It was prosecuted by Meredith Bateman, Assistant U.S. Attorney for the District of Oregon.

MIL Security OSI –

May 16, 2025

Peace breakthrough unlikely as Putin declines to meet Zelenskiy in Turkey

Source: Government of India

Source: Government of India (4)

Russia’s Vladimir Putin spurned a challenge to meet face-to-face with Volodymyr Zelenskiy in Turkey on Thursday, instead sending a second-tier delegation to planned peace talks, while Ukraine’s president said his defence minister would head up Kyiv’s team.

They will be the first direct talks between the sides since March 2022, but hopes of a major breakthrough were further dented by U.S. President Donald Trump, who said there would be no movement without a meeting between himself and Putin.

U.S. Secretary of State Marco Rubio later echoed that view, telling reporters in the Turkish resort of Antalya that Washington “didn’t have high expectations” for the Ukraine talks in Istanbul.

The head of the Russian delegation, presidential adviser Vladimir Medinsky, said he expected Ukraine’s representatives to turn up for the beginning of discussions on Friday in Istanbul at 10 a.m. local time (0700 GMT).

“We are ready to work,” Medinsky said in a video posted on the Telegram messaging app. He said his delegation had held “productive” talks on Thursday evening with Turkish Foreign Minister Hakan Fidan.

Zelenskiy said Putin’s decision not to attend but to send what he called a “decorative” lineup showed the Russian leader was not serious about ending the war. Russia accused Ukraine of trying “to put on a show” around the talks.

“We can’t be running around the world looking for Putin,” Zelenskiy said after meeting Turkish President Tayyip Erdogan in Ankara.

“I feel disrespect from Russia. No meeting time, no agenda, no high-level delegation – this is personal disrespect. To Erdogan, to Trump,” Zelenskiy told reporters.

Zelenskiy said he would also not go to Istanbul and that his team’s mandate was to discuss a ceasefire.

A decree issued by Zelenskiy said Ukraine’s delegation would be led by Defence Minister Rustem Umerov and include the deputy heads of its intelligence services, the deputy chief of the military’s general staff and the deputy foreign minister.

Ukraine backs an immediate, unconditional 30-day ceasefire but Putin has said he first wants to start talks at which the details of such a truce could be discussed. More than three years after its full-scale invasion, Russia has the advantage on the battlefield and says Ukraine could use a pause in the war to call up extra troops and acquire more Western weapons.

Both Trump and Putin have said for months they are keen to meet each other, but no date has been set. Trump, after piling heavy pressure on Ukraine and clashing with Zelenskiy in the Oval Office in February, has lately expressed growing impatience that Putin may be “tapping me along.”

“Nothing’s going to happen until Putin and I get together,” Trump told reporters aboard Air Force One.

Rubio, speaking in Antalya, later echoed that thought: “It’s my assessment that I don’t think we’re going to have a breakthrough here until the President (Trump) and President Putin interact directly on this topic.”

Referring to the current state of the talks as a “logjam,” Rubio said he would travel to Istanbul to meet with Turkey’s foreign minister and Ukraine’s delegation on Friday.

The diplomatic disarray was symptomatic of the hostility between the sides and the unpredictability injected by Trump, whose interventions since returning to the White House in January have often provoked dismay from Ukraine and its European allies.

While Zelenskiy waited in vain for Putin in Ankara, the Russian negotiators had no one to talk to on the Ukrainian side. Some 200 reporters milled around near the Dolmabahce Palace on the Bosphorus Strait that the Russians had specified as the venue.

CEASEFIRES AND PEACE TALKS

The enemies have been wrestling for months over the logistics of ceasefires and peace talks while trying to show Trump they are serious about trying to end what he calls “this stupid war.”

Hundreds of thousands have been killed and wounded on both sides in the deadliest conflict in Europe since World War Two. Washington has threatened repeatedly to abandon its mediation efforts unless there is clear progress.

Asked if Putin would join talks at some future point, Kremlin spokesperson Dmitry Peskov said: “What kind of participation will be required further, at what level, it is too early to say now.”

Russia said on Thursday its forces had captured two more settlements in Ukraine’s Donetsk region. A spokesperson for Russian Foreign Minister Sergei Lavrov pointedly reminded reporters of his comment last year that Ukraine was “getting smaller” in the absence of an agreement to stop fighting.

FIRST TALKS FOR THREE YEARS

Once they start, the talks will have to address a chasm between the two sides over a host of issues.

Russian delegation head Medinsky is a former culture minister who has overseen the rewriting of history textbooks to reflect Moscow’s narrative on the war. It includes a deputy defence minister, a deputy foreign minister and the head of military intelligence.

Key members of the team, including its leader, were also involved in the last direct peace talks in Istanbul in March 2022 – and Medinsky confirmed on Thursday that Russia saw the new talks as a resumption of those interrupted three years ago.

“The task of direct negotiations with the Ukrainian side is sooner or later to achieve long-term peace by eliminating the basic root causes of the conflict,” said Medinsky.

The terms under discussion in 2022, when Ukraine was still reeling from Russia’s initial invasion, would be deeply disadvantageous to Kyiv. They included a demand by Moscow for large cuts to the size of Ukraine’s military.

With Russian forces now in control of close to a fifth of Ukraine, Putin has held fast to his longstanding demands for Kyiv to cede territory, abandon its NATO membership ambitions and become a neutral country.

Ukraine rejects these terms as tantamount to capitulation, and is seeking guarantees of its future security from world powers, especially the United States.

(Reuters)

May 16, 2025

MIL-OSI: TruGolf Reports First Quarter 2025 Financial Results Q1 2025 Sales Grow 7.5% Over Q1 2024

Source: GlobeNewswire (MIL-OSI)

Salt Lake City, Utah, May 15, 2025 (GLOBE NEWSWIRE) — TruGolf Holdings, Inc. (NASDAQ: TRUG), a leading provider of golf simulator software and hardware, announced today its first quarter 2025 results. The Company reported sales of $5.4 million, up 7.5% compared to 2024 first quarter sales of $5.0 million. Net losses doubled to ($2.6) million for 2025’s first quarter, versus a net loss of ($1.3) million in the 2024 period, driven largely by recognition of interest expenses associated with the conversion of convertible notes in the period. EPS for 2025’s first quarter was ($0.09), an improvement from 2024’s ($0.22) loss per share.

Chief Executive Officer and Director Chris Jones said, “2025 got off to a solid start and we expect the sales cadence to improve over the course of the year, driven by new product introductions. Management’s attention has also focused on addressing the previously reported Nasdaq listing deficiencies. The Company has announced a plan that will significantly reduce debt on its balance sheet and increase shareholder equity. This plan has been presented at a Nasdaq Listing Qualifications hearing on May 15th and we expect to receive their determination in the near term.”

Mr. Jones continued, “We look forward to further growth in the business as we continue to innovate in creating the best virtual golf ecosystem in the market. We expect the first franchise locations to open over the next 90 days, with the associated delivery of TruGolf hardware and software solutions. We are optimistic that new products expected to launch in the coming months will be well received.”

Operations:

Gross margin for 2025’s first quarter improved to 68.0% as compared to 61.0% in 2024’s quarter. 2025’s loss from operations was 30.7% higher at ($1.2) million as compared to ($0.9) million in 2024. 2025 operating expenses increased by 22.5% or $0.9 million, driven by higher SG&A costs arising from higher third-party installation expenses, increased marketing costs and higher professional fees.

Interest expense jumped by $1.1 million as $1.7 million in principal amount of convertible notes and their$1.1 million associated accrued and make-whole interest converted to shares and their full interest costs were recognized in the conversion period. Cash flow used in operations was approximately $0.5 million in the first quarter of 2025, versus generation of $2.7 million in 2024’s quarter, with the difference resulting from a growth in inventory in the 2025 period, as well as the greater net loss for the period.

Disclaimer on Forward Looking Statements

This news release contains certain statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements that are not of historical fact constitute “forward-looking statements” and accordingly, involve estimates, assumptions, forecasts, judgements and uncertainties. Forward-looking statements include, without limitation, the timing of new franchise openings during 2025. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable as of the date made, expectations may prove to have been materially different from the results expressed or implied by such forward-looking statements. The Company has attempted to identify forward-looking statements by terminology including ”believes,” ”estimates,” ”anticipates,” ”expects,” ”plans,” ”projects,” ”intends,” ”potential,” ”may,” ”could,” ”might,” ”will,” ”should,” ”approximately” or other words that convey uncertainty of future events or outcomes to identify these forward-looking statements. These statements are only predictions and involve known and unknown risks, uncertainties, and other factors. Any forward-looking statements contained in this release speak only as of its date. The Company undertakes no obligation to update any forward-looking statements contained in this release to reflect events or circumstances occurring after its date or to reflect the occurrence of unanticipated events. More detailed information about the risks and uncertainties affecting the Company is contained under the heading “Risk Factors” in the Company’s Annual Report on Form 10-K and subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the SEC, which are available on the SEC’s website, www.sec.gov

About TruGolf:

Since 1983, TruGolf has been passionate about driving the golf industry with innovative indoor golf solutions. TruGolf builds products that capture the spirit of golf. TruGolf’s mission is to help grow the game by attempting to make it more Available, Approachable, and Affordable through technology – because TruGolf believes Golf is for Everyone. TruGolf’s team has built award-winning video games (“Links”), innovative hardware solutions, and an all-new e-sports platform to connect golfers around the world with E6 CONNECT. Since TruGolf’s beginning, TruGolf has continued to attempt to define and redefine what is possible with golf technology.

TRUGOLF HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS

	March 31,			December 31,
	2025			2024
		(Unaudited)
ASSETS

Current Assets:
Cash and cash equivalents	$	10,515,820		$	8,782,077
Restricted cash		2,100,000			2,100,000
Accounts receivable, net		1,579,614			1,399,153
Inventory, net		3,852,977			2,349,345
Prepaid expenses and other current assets		189,961			116,619
Other current assets		–			45,737
Total Current Assets		18,238,372			14,792,931

Property and equipment, net		192,711			143,852
Capitalized software development costs, net		1,710,652			1,540,121
Right-of-use assets		545,915			634,269
Other long-term assets		31,023			31,023

Total Assets	$	20,718,673		$	17,142,196

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current Liabilities:
Accounts payable	$	2,563,454		$	2,819,703
Deferred revenue		4,141,790			3,113,010
Notes payable, current portion		10,148			10,001
Notes payable to related parties, current portion		2,937,000			2,937,000

Line of credit, bank		802,738			802,738
Dividend notes payable		4,023,923			4,023,923
Accrued interest		565,402			661,376
Accrued and other current liabilities		2,823,067			999,307
Accrued and other current liabilities – assumed in Merger		45,008			45,008
Lease liability, current portion		296,291			363,102
Total Current Liabilities		18,208,821			15,775,168

Non-current Liabilities:
Notes payable, net of current portion		7,137			9,732
Note payables to related parties, net of current portion		624,000			624,000

PIPE loan payable, net		5,165,893			4,068,953
Gross sales royalty payable		1,000,000			1,000,000
Lease liability, net of current portion		278,071			305,125

Total Liabilities		25,283,922			21,782,978

Commitments and Contingencies

Stockholders’ Deficit:
Preferred stock, $0.0001 par value, 10 million shares authorized; zero shares issued and outstanding, respectively		–			–
Common stock, $0.0001 par value, 100,000,000 shares authorized:
Common stock – Series A, $0.0001 par value, 90 million shares authorized; 29,184,965 and 26,120,545 shares issued and outstanding, respectively		2,918			2,612
Common stock – Series B, $0.0001 par value, 10 million shares authorized; 1,716,860 and 1,716,860 shares issued and outstanding, respectively		172			172

Treasury stock at cost, 4,692 shares of common stock held, respectively		(2,037,000	)		(2,037,000	)
Additional paid-in capital		21,294,479			18,548,931
Accumulated deficit		(23,825,818	)		(21,155,496	)

Total Stockholders’ Deficit		(4,565,249	)		(4,640,781	)

Total Liabilities and Stockholders’ Deficit	$	20,718,673		$	17,142,196

TRUGOLF HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

	For the			For the
	Three Months Ended			Three Months Ended
	March 31, 2025			March 31, 2024

Revenue, net	$	5,389,230		$	5,012,022
Cost of revenue		1,726,199			1,959,023
Total gross profit		3,663,031			3,052,999

Operating expenses:
Royalties		225,320			329,888
Salaries, wages and benefits		1,946,816			1,841,595
Selling, general and administrative		2,725,119			1,825,201
Total operating expenses		4,897,255			3,996,684

Loss from operations		(1,234,224	)		(943,685	)

Other (expenses) income:
Interest income		54,596			30,587
Interest expense		(1,490,694	)		(384,854	)
Loss on investment		–			(3,912	)
Total other expense		(1,436,098	)		(358,179	)

Loss from operations before provision for income taxes		(2,670,322	)		(1,301,864	)

Provision for income taxes		–			–
Net loss	$	(2,670,322	)	$	(1,301,864	)

Net loss per common share Series A – basic and diluted	$	(0.09	)	$	(0.22	)
Net loss per common share Series B – basic and diluted	$	(1.56	)	$	(1.14	)

Weighted average shares outstanding Series A – basic and diluted		28,461,277			5,994,704
Weighted average shares outstanding Series B – basic and diluted		1,716,860			1,144,573

TRUGOLF HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

	For the			For the
	Three Months Ended			Three Months Ended
	March 31, 2025			March 31, 2024

Cash flows from operating activities:
Net loss	$	(2,670,322	)	$	(1,301,864	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		115,300			36,105
Amortization of convertible notes discount		231,940			947
Amortization of right-of-use asset		88,354			82,454
Change in OCI		–			1,662
Stock issued for make good provisions on debt conversion		1,087,513			–
Stock options issued to employees		3,341			–
Changes in operating assets and liabilities:
Accounts receivable, net		(180,461	)		468,422
Inventory, net		(1,503,632	)		(216,569	)
Prepaid expenses		(73,342	)		200,278
Other current assets		45,737			2,478,953
Accounts payable		(256,248	)		1,146,347
Deferred revenue		1,028,780			90,524
Accrued interest payable		(95,974	)		82,759
Accrued and other current liabilities		1,823,760			(321,090	)
Lease liability		(93,865	)		(80,311	)
Net cash provided by (used in) operating activities		(449,119	)		2,668,617

Cash flows from investing activities:
Purchases of property and equipment		(64,159	)		(332,342	)
Capitalized software, net		(270,531	)		–
Net cash used in investing activities		(334,690	)		(332,342	)

Cash flows from financing activities:
Proceeds from PIPE loans, net of discount		2,520,000			4,320,000
Cash acquired in Merger		–			103,818
Increase in other liabilities		–			18,545
Costs of Merger paid from PIPE loan		–			(2,082,787	)
Repayments of line of credit		–			(1,980,937	)
Repayments of liabilities assumed in Merger		–			(15,716	)
Repayments of notes payable		(2,448	)		(2,295	)
Repayments of notes payable – related party		–			(268,500	)
Net cash provided by financing activities		2,517,552			92,128

Net change in cash , cash equivalents and restricted cash		1,733,743			2,428,403

Cash, cash equivalents and restricted cash – beginning of year		10,882,077			5,397,564

Cash, cash equivalents and restricted cash – end of year	$	12,615,820		$	7,825,967

Supplemental cash flow information:
Cash paid for:
Interest	$	108,993		$	302,095
Income taxes	$	–		$	–
Non-cash investing and financing activities:
PIPE note principal converted to Class A Common Stock	$	1,655,000		$	–
Notes payable assumed in Merger	$	–		$	1,565,000
Accrued liabilities assumed in Merger	$	–		$	310,724
Remeasurement of common stock exchanged/issued in Merger	$	–		$	(1,875,724	)

The MIL Network –

May 16, 2025

MIL-OSI Australia: Pillar Two interactions with other provisions

Source: New places to play in Gungahlin

Interaction with other provisions

Australia’s implementation of the Global Anti-Base Erosion Model RulesExternal Link (GloBE Rules) includes consequential amendments to Australia’s income tax law to clarify its interaction with Pillar Two. The amendments are included in the Multinational—Global and Domestic Minimum Tax (Consequential) Act 2024External Link.

In particular, the Consequential Act includes amendments to specific Australian cross-border tax provisions. These include rules concerning foreign income tax offsets, controlled foreign companies, hybrid mismatches and foreign hybrids.

Australia’s foreign income tax offset (FITO) rules do not provide a foreign tax credit for taxes paid under a foreign income inclusion rule (IIR) and foreign undertaxed profits rule (UTPR).

However, to the extent you satisfy the usual eligibility criteria and integrity rules, a FITO may be claimed in respect of foreign domestic minimum top-up tax (DMT) paid on income included in your Australian assessable income.

The amount of the FITO allowed in respect of foreign DMT taxes is subject to an additional safeguard.

New FITO integrity rule for foreign DMT taxes

The amount of DMT tax which an entity is treated as having paid is reduced by:

the amount of a refundable tax credit that is refunded to an entity because the credit exceeds income tax liability
consideration received for the transfer of a transferable tax credit to which an entity was entitled in respect of a foreign income tax of that jurisdiction
cash or cash equivalent amounts recognised as government grants under International Accounting Standard 20 (or a comparable accounting standard applicable under a foreign law)
a benefit of a kind specified by the Minister in respect of a specified jurisdiction.

This new integrity rule complements the existing FITO integrity rule. The existing rule reduces the amount of foreign income tax that an entity is considered to have paid:

to the extent it is entitled to refunds of the foreign income tax, or
by any other benefits worked out by reference to the amount of foreign income tax.

Example: New FITO integrity rule for foreign DMT

Entity A (a constituent entity located in unlisted country Jurisdiction A) is a Controlled Foreign Company (CFC), wholly owned by Aus Co, which is part of the same multinational enterprise group (MNE group).

Jurisdiction A has a corporate tax rate of 10% and has enacted a Qualified Domestic Minimum Top-up Tax.

Entity A receives a $6 grant from the government of Jurisdiction A (recognised as a government grant under an applicable accounting standard).

Entity A derived $85 of attributable income, which is wholly attributable to Aus Co. In arriving at the $85 of attributable income, a notional deduction of $10 for corporate income tax and $5 for a foreign DMT tax paid in Jurisdiction A is claimed.

Assuming other relevant conditions in the FITO rules are satisfied, the amount of FITO that could have been available for Aus Co would have been $15 (the combination of $10 CIT and $5 DMT), disregarding the new integrity rule.

However, under the new integrity rule, the FITO is reduced by the government grant ($6), capped at the amount of foreign DMT tax paid ($5).

Therefore, the FITO allowed is $15 – $5 = $10.

End of example

Controlled foreign company rules

The CFC rules work to attribute foreign income earned by a foreign company back to Australia in certain circumstances. The interactions between the CFC rules and Pillar Two are such that:

Tax imposed under CFC tax regimes (including Australia) are taken into account when calculating the effective tax rate of a jurisdiction for Pillar Two purposes.
Foreign DMT, IIR or UTPR taxes are excluded from the meaning of ‘subject to tax’ for CFCs and transferor trusts located in a listed jurisdiction under section 324 of the Income Tax Assessment Act 1936 (ITAA 1936). This will also impact whether certain income is considered eligible designated concession income (EDCI) and therefore taxed in Australia.
Taxpayers are precluded from notionally deducting foreign IIR tax and foreign UTPR tax in calculating attributable income under section 393 of the ITAA 1936.
A notionally allowable deduction may be available for payments of foreign DMT tax.

Australia’s Qualified Domestic Minimum Tax (QDMT) is given priority in its application to Australian income and does not take into account taxes imposed under other CFC tax regimes.

Example: Eligible designated concessional income

Australian Entity A Co is an attributable taxpayer in respect of B Co, which is located in an overseas listed country. The listed country has implemented the IIR, UTPR and DMT.

The listed country applies a QDMT, which includes an item of income from B Co in its Effective Tax Rate (ETR) calculation. This income is otherwise exempt for corporate income tax purposes in the listed country.

In determining whether the item of income has been subject to tax in a listed country, the taxpayer is required to disregard any imposition of GloBE taxes (IIR, UTPR and DMT). The item is still considered as EDCI.

The taxpayer is also entitled to a notional deduction for any foreign DMT paid in respect of the EDCI included in its notional assessable income.

End of example

Hybrid mismatch rules

The operation of Australia’s hybrid mismatch rules broadly continues to operate unaffected by the Australian global and domestic minimum tax.

Foreign DMT, IIR or UTPR and other foreign minimum taxes are disregarded when determining if an amount of income is subject to foreign income tax per the hybrid mismatch rules under section 832-120 of the Income Tax Assessment Act 1997. This ensures that a hybrid mismatch can be identified irrespective of whether a jurisdiction has implemented an IIR, UTPR or DMT.

The disregarding of such taxes also applies in the context of Australia’s targeted integrity rule in Subdivision 832-J. Specifically, a foreign GloBE tax does not impact whether a payment of interest or an amount under a derivative financial arrangement is subject to foreign income tax at a rate of 10% or less. However, the application of foreign IIR, UTPR and DMT taxes may still be a relevant factor under the principal purpose test in determining whether it is reasonable to conclude that an entity entered a scheme with the requisite purpose.

Foreign hybrid rules

Similarly, Australia’s foreign hybrid rules broadly continues to operate unaffected by the Pillar Two regime.

Australia’s foreign hybrid rules ensure that an entity that qualifies as a ‘foreign hybrid’ is treated as a partnership (rather than a company) for Australian tax purposes.

One of the requirements for entities to be treated as foreign hybrids is that no foreign income tax is imposed on the entity itself. References to ‘foreign income tax’ do not include foreign IIR, UTPR and DMT taxes and other foreign minimum taxes, ensuring that the foreign hybrid rules are not impacted by a foreign jurisdiction’s decision to impose such taxes at the level of the foreign hybrid entity.

Example: Foreign hybrid limited partnership

Polar LLP is located in Jurisdiction A. AusCo, located in Australia, is a limited partner of Polar LLP. Under the corporate income tax regime of Jurisdiction A, Polar LLP is treated as fiscally transparent, and the imposition of taxes are on partners of Polar LLP of which AusCo is one.

Assuming all other relevant conditions are met under Australia’s foreign hybrid rules, Polar LLP is treated as a fiscally transparent partnership for Australian tax purposes. One of the requirements to be met is that foreign income tax is imposed on the partners of Polar LLP (including AusCo) and not on Polar LLP itself.

Jurisdiction A implements a IIR, UTPR and DMT, and legislates for these GloBE and DMT related liabilities to be imposed on limited partnerships (such as Polar LLP) instead of on its partners.

AusCo is required to disregard the imposition of those taxes on the partnership and will continue to treat Polar LLP as a foreign hybrid limited partnership under Division 830.

End of example

More information

For more information, see:

MIL OSI News –

May 16, 2025

MIL-OSI China: More tax refund stores set to open

Source: People’s Republic of China – State Council News

China plans to accelerate the availability of tax refund stores for eligible overseas visitors to about 10,000 shops nationwide this year, almost tripling the current number, as the country continues to boost inbound tourism and consumption, a senior official said.

By the end of last year, China had more than 3,700 stores nationwide available for tax refunds for overseas visitors, adding more than 600 stores over the previous year, the Ministry of Commerce said.

Promoting inbound consumption serves as an important lever to help vigorously boost consumption, and it holds great growth potential. It will also help offset the impact of additional tariffs to a certain extent, said Sheng Qiuping, vice-minister of commerce, during a conference on Thursday in Beijing.

China will continue to optimize the layout of tax refund stores, and encourage various regions to set up such stores in major commercial complexes, shopping streets, tourist attractions, resorts, cultural and museum venues, airports, passenger ports, hotels and other places where overseas tourists gather, according to a guideline issued by the Ministry of Commerce and five other departments in late April.

The country has lowered the starting point for tax refunds from 500 yuan ($69.3) to 200 yuan and doubled the limit for cash refunds from 10,000 yuan to 20,000 yuan.

In addition, the country will relax the registration requirements for retailers to become tax refund stores, allowing newly opened shops that have been established for less than a year to apply to become tax refund shops, and the filing time has been shortened to within five working days, the guideline said.

“Tax refund stores are also encouraged to broaden product offerings to include time-honored brands, renowned Chinese consumer goods, smart devices, intangible cultural heritage items, crafts and specialty products,” Sheng said.

Globally, Japan has more than 60,000 stores that are available for tax refunds for overseas visitors, and South Korea has some 20,000 such stores. France, Germany and Italy each have over 10,000 such stores. The number of such stores in China is far from enough, the Ministry of Commerce said.

Last year, the total expenditure of inbound tourists in China reached $94.2 billion, accounting for 0.5 percent of China’s GDP, which is lower than the proportions of 1 percent to 3 percent for major countries in the world, said the commerce ministry.

“Accelerating the promotion of the tax refund policy will help reduce shopping costs for overseas travelers and inject new impetus to boost consumption. This is an important measure for China to cope with external uncertainties,” Sheng said.

China has been opening its doors wider to international travelers. In 2024, the country expanded its unilateral visa-free policy to include 38 countries, allowing visits of up to 30 days, according to the National Immigration Administration.

Multiple favorable policies have helped significantly boost inbound consumption. During the recent five-day May Day holiday, the country saw the number of inbound and outbound passenger trips of foreign visitors exceed 1.1 million, up 43.1 percent year-on-year, said the National Immigration Administration.

Shanghai, one of the cities with the highest concentration of foreign tourists, said inbound consumption has become an important lever for it to actively respond to the trade frictions between China and the United States, and promoting inbound consumption will help the city to build itself into an international consumption center.

MIL OSI China News –

May 16, 2025

MIL-OSI: Mount Logan Capital Inc. Announces First Quarter 2025 Financial Results

Source: GlobeNewswire (MIL-OSI)

Declared quarterly distribution of C$0.02 per common share in the second quarter of 2025, the twenty-third consecutive quarter of a shareholder distribution

Asset management segment generated $8.1 million in Fee Related Earnings (“FRE”) for the trailing twelve months ended March 31, 2025, a 25% increase over the prior year period

Generated $7.8 million of Spread Related Earnings (“SRE”) for the trailing twelve months ended March 31, 2025, which reflects 1.3% of spread earnings on Ability’s assets

During January 2025, the Company announced it entered into a definitive agreement to combine with 180 Degree Capital Corp. (Nasdaq: TURN) in an all-stock transaction. The surviving entity is expected to operate as Mount Logan Capital Inc. (“New Mount Logan”) and to be listed on Nasdaq under the symbol MLCI

In January 2025, Mount Logan completed its previously announced investment in Runway Growth Capital LLC, a $1.3 billion private credit asset manager, alongside BC Partners Credit

All amounts are stated in United States dollars, unless otherwise indicated

TORONTO, May 15, 2025 (GLOBE NEWSWIRE) — Mount Logan Capital Inc. (Cboe Canada: MLC) (“Mount Logan” or the “Company”) announced today its financial results for the three months ended March 31, 2025.

First Quarter 2025 Highlights

FRE for the asset management segment was $2.2 million for the quarter, an increase of 37% compared to the first quarter of 2024, due to improved economics on the Company’s service agreement with Sierra Crest Investment Management over an interval fund, and the decrease in general, administrative and other expenses from the expiry of transition services agreements and other one-time expenses incurred in the first quarter of 2024. FRE for the trailing twelve months was $8.1 million, an increase of 25% from the comparative trailing twelve-month period, primarily attributable to increases in management fees.
Total revenue for the asset management segment of the Company was $3.2 million, a decrease of $0.8 million, or 21%, as compared to the first quarter of 2024. The decrease was driven by a reduction in and normalization of incentive fees associated with a single managed fund in winddown, and an increase in net loss from investment activities, both of which we view as transitory elements. First quarter asset management revenues also exclude $1.2 million of management fees associated with Mount Logan’s management of the assets of Ability Insurance Company (“Ability”), a wholly-owned subsidiary of the Company. Normalized Ability management fees for the first quarter of 2025 were $1.6 million, excluding one-time expenses, which are not expected to continue throughout the remainder of the year.
Total net investment income for the insurance segment was $19.0 million for the three months ended March 31, 2025, a decrease of $2.8 million, or 13%, as compared to the first quarter of 2024, owing to interest expense related to the interest rate swap, decrease in bond yields and decrease in the long term investments portfolio. Excluding the funds withheld assets under reinsurance contracts and Modco, the insurance segment’s net investment income was $14.5 million, an increase of $0.4 million, or 3%, as compared to the first quarter of 2024.
Achieved 6.9%¹yield on the insurance investment portfolio for the quarter ended March 31, 2025. This was impacted by higher investment expense on funds withheld assets under the Modco arrangement. Excluding the funds withheld under reinsurance contracts and Modco, the yield was 8.8%.
Ability’s total assets managed by Mount Logan increased to $645.7 million as of March 31, 2025, an increase of $28.9 million from first quarter 2024 of $616.8 million. As of March 31, 2025, the insurance segment included $1.02 billion in total investment assets, down $23.0 million, or 2%, from the first quarter of 2024 investment assets of $1.04 billion. During the quarter, Mount Logan began managing a portion of Ability’s modified coinsurance assets with Vista.
Book value of the insurance segment as of March 31, 2025 was $85.9 million, an increase of $3.3 million as compared to $82.6 million for the first quarter of 2024.
SRE for the insurance segment was $7.8 million for the trailing twelve months ended March 31, 2025, down $1.7 million from the trailing twelve months ended March 31, 2024 of $9.5 million, primarily driven by an increase in cost of funds, partially offset by increased net investment income and lower operating expenses. The increase in cost of funds was primarily driven by unfavorable in-force update to the Long Term Care business (Guardian block) of $1.8 million for the trailing twelve months ended March 31, 2025, while there was a favorable in-force update to the LTC business (Medico block) observed of $4.8 million for the twelve months ended March 31, 2024.

Subsequent Events

Declared a shareholder distribution in the amount of C$0.02 per common share for the quarter ended March 31, 2025, payable on June 2, 2025 to shareholders of record at the close of business on May 27, 2025. This cash dividend marks the twenty-third consecutive quarter of the Company issuing a C$0.02 distribution to its shareholders. This dividend is designated by the Company as an eligible dividend for the purpose of the Income Tax Act (Canada) and any similar provincial or territorial legislation. An enhanced dividend tax credit applies to eligible dividends paid to Canadian residents.
A preliminary joint proxy statement/prospectus was filed with the United States Securities and Exchange Commission (the “SEC”) for the previously announced merger of Mount Logan with 180 Degree Capital Corp. (Nasdaq: TURN) (“180 Degree Capital”), in an all-stock transaction (the “Business Combination”). The surviving entity is expected to be a Delaware corporation operating as New Mount Logan listed on Nasdaq under the symbol “MLCI”. As required under U.S. federal securities laws and related rules and regulations, the joint proxy statement/prospectus included Mount Logan’s audited financial statements for the years ended December 31, 2024 and 2023 prepared in accordance with U.S. Generally Accepted Accounting Principles. In connection with the Business Combination, shareholders of Mount Logan will receive proportionate ownership of New Mount Logan determined by reference to Mount Logan’s transaction equity value at signing, subject to certain pre-closing adjustments, relative to 180 Degree Capital’s Net Asset Value (“NAV”) at closing. Shareholders holding approximately 26% of the outstanding shares of Mount Logan and approximately 20% of the outstanding shares of 180 Degree Capital signed voting agreements supporting the Business Combination, and an additional 8% of Mount Logan and 7% of 180 Degree Capital shareholders, respectively, have provided written non-binding indications of support for the Business Combination.
Portman Ridge Finance Corporation (Nasdaq: PTMN) and Logan Ridge Finance Corporation (Nasdaq: LRFC) merger remains subject to the receipt of certain shareholder approvals and the satisfaction of other closing conditions. Mount Logan currently earns management fees from LRFC and has a minority stake in PTMN’s manager, Sierra Crest Investment Management.

Management Commentary

Ted Goldthorpe, Chief Executive Officer and Chairman of Mount Logan stated, “We are pleased to report our first quarter 2025 results, reflecting the continued earnings power of our asset management and insurance platforms. While AUM growth slowed in Q1 2025, consistent with broader macro challenges, we demonstrated our ability to generate strong, positive Fee Related Earnings on the asset management segment, and Spread Related Earnings in the insurance platform, providing a solid foundation for momentum in 2025. Our managed funds demonstrated performance resilience and low volatility as compared to the public credit and equity markets, which we view as a testament to our focus on private credit assets. Looking ahead, we see ample opportunities to drive AUM growth across our core managed vehicles, enact operational improvements and efficiencies, while also advancing strategic priorities to scale the business through reinvestment across our segments and accretive acquisition opportunities, which includes our recently announced transactions with 180 Degree Capital and Runway, which we believe will be significant catalysts for long-term growth and investment into our business.”

Selected Financial Highlights

Total Capital of the Company was $144.9 million as at March 31, 2025, a decrease of $5.4 million as compared to December 31, 2024. Total capital consists of debt obligations and total shareholders’ equity.
Consolidated net income (loss) before taxes was $(13.7) million for the first quarter of 2025, a decrease of $26.8 million from $13.1 million in the first quarter of 2024. The decrease was primarily attributable to the increase in net insurance finance expenses, decrease in net investment income and increase in general, administrative and other expenses under the insurance segment, as well as an increase in corporate transaction costs under the asset management segment related to the Business Combination when compared to the first quarter of 2024.
Basic Earnings (loss) per share (“EPS”) was ($0.48) for the first quarter of 2025, a decrease of $0.99 from $0.51 for the first quarter of 2024.
Adjusted basic EPS was ($0.29) for the first quarter of 2025, a decrease of $0.83 from $0.54 for the first quarter of 2024.

Results of Operations by Segment

($ in Thousands)	Three Months Ended
	March 31, 2025			December 31, 2024			March 31, 2024
Reported Results
*Asset management*
Revenue	$	3,192		$	4,442		$	4,030
Expenses		12,578			13,440			7,615
Net income (loss) – asset management		(9,386	)		(8,998	)		(3,585	)
*Insurance*
Revenue ⁽¹⁾		18,982			(622	)		17,555
Expenses		23,280			(16,142	)		822
Net income (loss) – insurance		(4,298	)		15,520			16,733
Income before income taxes		(13,684	)		6,522			13,148
Provision for income taxes		361			37			(56	)
Net income (loss)	$	(13,323	)	$	6,559		$	13,092
Basic EPS	$	(0.48	)	$	0.25		$	0.51
Diluted EPS	$	(0.48	)	$	0.23		$	0.50
Adjusting Items
*Asset management*
Transaction costs ⁽²⁾		(4,545	)		(1,921	)		(251	)
Acquisition integration costs ⁽³⁾		—			—			(250	)
Non-cash items ⁽⁴⁾		(737	)		(2,940	)		(346	)
Impact of adjusting items on expenses		(5,282	)		(4,861	)		(847	)
Adjusted Results
*Asset management*
Revenue	$	3,192		$	4,442		$	4,030
Expenses		7,296			8,579			6,768
Net income (loss) – asset management		(4,104	)		(4,137	)		(2,738	)
Income before income taxes		(8,402	)		11,383			13,995
Provision for income taxes		361			37			(56	)
Net income (loss)	$	(8,041	)	$	11,420		$	13,939
Basic EPS	$	(0.29	)	$	0.44		$	0.54
Diluted EPS	$	(0.29	)	$	0.40		$	0.54

^{(1)    Insurance Revenue line item is presented net of insurance service expenses and net expenses from reinsurance contracts held.}
^{(2)    Transaction costs are related to business acquisitions and strategic initiatives transacted by the Company.}
^{(3)    Acquisition integration costs are consulting and administration services fees related to integrating a business into the Company. Acquisition integration costs are recorded in general, administrative and other expenses.}
^{(4)    Non-cash items include amortization and impairment of acquisition-related intangible assets and impairment of goodwill, if any.}

Asset Management

Total Revenue – Asset Management

($ in Thousands)

	Three Months Ended
	March 31, 2025			March 31, 2024
Management and incentive fee	$	2,928		$	3,494
Equity investment earning		282			224
Interest income		268			271
Dividend income		38			112
Other Income		299			—
Net gains (losses) from investment activities		(623	)		(71	)
Total revenue — asset management	$	3,192		$	4,030

Fee Related Earnings (“FRE”)

FRE is a non-IFRS financial measure used to assess the asset management segment’s generation of profits from revenues that are measured and received on a recurring basis and are not dependent on future realization events. The Company calculates FRE, and reconciles FRE to net income from its asset management activities, as follows:

($ in Thousands)

	Three Months Ended
	March 31, 2025			March 31, 2024
Net income (loss) and comprehensive income (loss)	$	(13,323	)	$	13,092

Adjustment to net income (loss) and comprehensive income (loss):
Total revenue – insurance ⁽¹⁾		(18,982	)		(17,555	)
Total expenses – insurance		23,280			822
Net income – asset management ⁽²⁾		(9,025	)		(3,641	)
Adjustments to non-fee generating asset management business and other recurring revenue stream:
Management fee from Ability		1,566			1,429
Interest income		—			—
Dividend income		(39	)		(112	)
Net gains (losses) from investment activities⁽³⁾		623			71
Administration and servicing fees		504			366
Transaction costs		4,545			251
Amortization and impairment of intangible assets		737			346
Interest and other credit facility expenses		1,857			1,702
General, administrative and other		1,479			1,233
Fee Related Earnings	$	2,247		$	1,645

^{(1) Includes add-back of management fees paid to ML Management.}

^{(2) Represents net income for asset management, as presented in the interim Consolidated Statement of Comprehensive Income (Loss).}

^{(3) Includes unrealized gains or losses on the debt warrants.}

($ in Thousands)	Trailing Twelve Months Ended
	March 31, 2025			March 31, 2024
Net income (loss) and comprehensive income (loss)	$	(20,826	)	$	26,088

Adjustment to net income (loss) and comprehensive income (loss):
Total revenue – insurance ⁽¹⁾		(65,582	)		(76,512	)
Total expenses – insurance		60,979			35,450
Net income – asset management ⁽²⁾		(25,429	)		(14,974	)
Adjustments to non-fee generating asset management business and other recurring revenue stream:
Management fee from Ability		6,162			4,853
Interest income		(1	)		—
Dividend income		(425	)		(640	)
Net gains (losses) from investment activities⁽³⁾		1,995			157
Administration and servicing fees		1,743			1,228
Transaction costs		6,468			3,814
Amortization and impairment of intangible assets		4,369			1,178
Interest and other credit facility expenses		8,090			6,425
General, administrative and other		5,177			4,481
Fee Related Earnings	$	8,149		$	6,522

^{(1) Includes add-back of management fees paid to ML Management.}

^{(2) Represents net income for asset management, as presented across the interim Consolidated Statements of Comprehensive Income (Loss).}

^{(3) Includes unrealized gains or losses on the debt warrants.}

Insurance

Total Revenue – Insurance

($ in Thousands)

	Three Months Ended
	March 31, 2025			March 31, 2024
Insurance service result	$	(2,197	)	$	(3,092	)
Net investment income		19,004			21,804
Net gains (losses) from investment activities		6,958			2,666
Realized and unrealized gains (losses) on embedded derivative — funds withheld		(4,783	)		(3,829	)
Other income		—			6
Total revenue — net of insurance services expenses and net expenses from reinsurance	$	18,982		$	17,555

Spread Related Earnings (“SRE”)

The Company uses SRE to assess the performance of the insurance segment, excluding the impact of certain market volatility and other one-time, non-core components of insurance segment income (loss). Excluded items under SRE are investment gains (losses), effects of discount rates and other financial variables on the value of insurance obligations (which is a component of “net insurance finance income/(expense)”), other income and certain general, administrative & other expenses. The Company believes this measure is useful to securityholders as it provides additional insight into the underlying economics of the insurance segment, as further discussed below.

For the insurance segment, SRE equals the sum of (i) the net investment income on the insurance segment’s net invested assets (excluding investment income earned on funds held under reinsurance contracts) less (ii) cost of funds (as described below) and (iii) certain operating expenses.

Cost of funds includes the impact of interest accretion on insurance and investment contract liabilities and amortization of losses recognized for new insurance contracts that are deemed onerous at initial recognition. It also includes experience adjustments which represents the difference between actual and expected cashflows and includes the impact of certain changes to non-financial assumptions.

The Company reconciles SRE to net income (loss) before tax from its insurance segment activities, as follows:

	Three Months Ended
	Q1-2025			Q4-2024			Q3-2024			Q2-2024			Q1-2024			Q4-2023			Q3-2023			Q2-2023
Net income (loss) and comprehensive income (loss) before tax	$	(13,639	)	$	6,522		$	(17,378	)	$	3,847		$	13,148		$	(1,946	)	$	16,243		$	(903	)

Adjustment to net income (loss) and comprehensive income (loss):
Total revenue – asset management ⁽¹⁾		(3,192	)		(4,442	)		(3,826	)		(3,394	)		(4,030	)		(3,723	)		(3,186	)		(2,996	)
Total expenses – asset management		12,533			13,440			7,481			6,651			7,615			7,839			6,868			6,133
Net income – insurance ⁽²⁾		(4,298	)		15,520			(13,723	)		7,104			16,733			2,170			19,925			2,234
Adjustments to Insurance segment business:
Management fees to ML Management		(1,167	)		(1,167	)		(1,501	)		(1,529	)		(1,429	)		(1,345	)		(1,110	)		(969	)
Net (gains) losses from investment activities⁽³⁾		(5,718	)		17,681			(13,267	)		887			(2,995	)		(10,116	)		(2,113	)		(1,454	)
Other Income⁽⁴⁾		—			—			—			—			—			(7,353	)		—			—
Net insurance finance (income)/expense⁽⁵⁾		12,506			(28,702	)		30,940			(5,442	)		(11,769	)		14,399			(17,684	)		(5,275	)
Loss on onerous contracts⁽⁶⁾		(1,548	)		(545	)		(822	)		945			6,884			286			2,451			4,214
General, administrative and other⁽⁷⁾		600			338			239			464			447			502			1,289			1,546
Spread Related Earnings	$	375		$	3,125		$	1,866		$	2,429		$	7,871		$	(1,457	)	$	2,758		$	296

^{(1) Includes add-back of management fees paid by Ability to ML Management.}

^{(2) Represents net income before tax for the insurance segment, as presented in the annual Consolidated Statement of Comprehensive Income (Loss).}

^{(3) Excludes net (gains) losses from investment activities on assets retained by the Company under funds withheld arrangement with Front Street Re and Vista.}

^{(4) Represents non-operating income.}

^{(5) Includes the impact of changes in interest rates and other financials assumptions and excludes interest accretion on insurance contract liabilities and reinsurance contract assets.}

^{(6) Represents the unamortized portion of future interest accretion and ceded commissions paid at the time of issue of new MYGA insurance contracts. Future interest accretion and ceded commissions are amortized over the average duration of MYGA contracts reinsured which aligns with the recognition of insurance service revenue. Loss on onerous contracts are part of Insurance service expense.}

^{(7) Represents certain costs incurred by the insurance segment for purposes of IFRS reporting but not the day to day operations of the insurance company.}

The following table presents SRE, the performance measure of the insurance segment:

($ in Thousands)

	Trailing Twelve Months Ended
	March 31, 2025			March 31, 2024
Fixed Income and other investment income, net⁽¹⁾	$	54,342		$	50,502
Cost of funds		(38,352	)		(32,318	)
Net Investment spread		15,990			18,184
Other operating expenses		(8,195	)		(8,716	)
Spread Related Earnings	$	7,795		$	9,468
SRE % of Average Net Investments		1.3	%		1.7	%

^{(1) Excludes net investment income from investment activities on assets retained by the Company under funds withheld arrangement with Front Street Re and Vista Life and Casualty Reinsurance Company (“Vista”).}

Spread related earnings (“SRE”) was $7.8 million for the trailing twelve months ended March 31, 2025 compared with $9.5 million for the trailing twelve months ended March 31, 2024, a decrease of $1.7 million. SRE decreased year over year due to higher cost of funds, partially offset by increased investment income and lower other operating expenses. Cost of funds increased primarily due to unfavorable impact of $1.8 million as a result of in-force update to LTC business (Guardian block) whereas the trailing twelve months ended March 31, 2024 had a favorable in-force impact of $4.8 million to LTC business (Medico block). Investment income increased primarily due to an increase in total insurance investment assets as a result of new multi-year guaranteed annuity (“MYGA”) business and improvement in yield across the investment portfolio. Other operating expenses decreased as a result of efforts to reduce overall operating cost.

SRE as a percentage of average net invested assets was 1.3% for the trailing twelve months ended March 31, 2025 compared with 1.7% for the trailing twelve months ended March 31, 2024.

Liquidity and Capital Resources

As of March 31, 2025, the asset management segment had $77.8 million (par value) of borrowings outstanding, of which $33.8 million had a fixed rate and $44.0 million had a floating rate. As of March 31, 2025, the insurance segment had $17.3 million (par value) of borrowings outstanding, of which $14.3 million had a fixed rate and $3.0 million had a floating rate. Liquid assets, including high-quality assets that are marketable, can be pledged as security for borrowings, and can be converted to cash in a time frame that meets liquidity and funding requirements. As of March 31, 2025 and December 31, 2024, the total liquid assets of the Company were as follows:

($ in Thousands)

As at	March 31, 2025		December 31, 2024
Cash and cash equivalents	$	125,808	$	85,988
Restricted cash posted as collateral		12,526		15,716
Investments		609,514		639,932
Management fee receivable		2,927		3,268
Receivable for investments sold		23		17,045
Accrued interest and dividend receivable		20,959		20,489
Total liquid assets	$	771,757	$	782,438

The Company defines working capital as the sum of cash, restricted cash, investments that mature within one year of the reporting date, management fees receivable, receivables for investments sold, accrued interest and dividend receivables, and premium receivables, less the sum of debt obligations, payables for investments purchased, amounts due to affiliates, reinsurance liabilities, and other liabilities that are payable within one year of the reporting date.

As at March 31, 2025, the Company had working capital of $218.8 million, reflecting current assets of $241.7 million, offset by current liabilities of $22.9 million, as compared with working capital of $231.2 million as at December 31, 2024, reflecting current assets of $245.3 million, offset by current liabilities of $14.1 million. The decrease in working capital was primarily attributable to the decrease in cash within the asset management business combined with the increase in accrued expenses across asset management and insurance.

Interest Rate Risk

The Company has obligations to policyholders and other debt obligations that expose it to interest rate risk. The Company also owns debt assets and interest rate swaps that are exposed to interest rate risk. The fair value of these obligations and assets may change if base rate changes in interest rates occur.

The following table summarizes the potential impact on net assets of hypothetical base rate changes in interest rates assuming a parallel shift in the yield curve, with all other variables remaining constant.

As at	March 31, 2025			December 31, 2024
50 basis point increase ⁽¹⁾	$	(8,836	)	$	7,559
50 basis point decrease ⁽¹⁾		5,913			(18,939	)

^{(1) Losses are presented in brackets and gains are presented as positive numbers.}

Actual results may differ significantly from this sensitivity analysis. As such, the sensitivities should only be viewed as directional estimates of the underlying sensitivities for the respective factors based on the assumptions outlined above.

Conference Call

The Company will hold a conference call on Friday, May 16, 2025 at 11:00 a.m. Eastern Time to discuss the first quarter financial results. Shareholders, prospective shareholders, and analysts are welcome to listen to the call. To join the call, please use the dial-in information below. A recording of the conference call will be available on our Company’s website www.mountlogancapital.ca in the ‘Investor Relations’ section under “Events”.

Canada Dial-in Toll Free: 1-833-950-0062
US Dial-in Toll Free: 1-833-470-1428
International Dial-ins
Access Code: 813165

About Mount Logan Capital Inc.

Mount Logan Capital Inc. is an alternative asset management and insurance solutions company that is focused on public and private debt securities in the North American market and the reinsurance of annuity products, primarily through its wholly owned subsidiaries Mount Logan Management LLC (“ML Management”) and Ability Insurance Company (“Ability”), respectively. Mount Logan also actively sources, evaluates, underwrites, manages, monitors and primarily invests in loans, debt securities, and other credit-oriented instruments that present attractive risk-adjusted returns and present low risk of principal impairment through the credit cycle.

ML Management was organized in 2020 as a Delaware limited liability company and is registered with the SEC as an investment adviser under the Investment Advisers Act of 1940, as amended. The primary business of ML Management is to provide investment management services to (i) privately offered investment funds exempt from registration under the Investment Company Act of 1940, as amended (the “1940 Act”) advised by ML Management, (ii) a non-diversified closed end management investment company that has elected to be regulated as a business development company, (iii) Ability, and (iv) non-diversified closed-end management investment companies registered under the 1940 Act that operate as interval funds. ML Management also acts as the collateral manager to collateralized loan obligations backed by debt obligations and similar assets.

Ability is a Nebraska domiciled insurer and reinsurer of long-term care policies and annuity products acquired by Mount Logan in the fourth quarter of fiscal year 2021. Ability is also no longer insuring or re-insuring new long-term care risk.

Non-IFRS Financial Measures

This press release makes reference to certain non-IFRS financial measures. These measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement IFRS financial measures by providing further understanding of the Company’s results of operations from management’s perspective. The Company’s definitions of non-IFRS measures used in this press release may not be the same as the definitions for such measures used by other companies in their reporting. Non-IFRS measures have limitations as analytical tools and should not be considered in isolation nor as a substitute for analysis of the Company’s financial information reported under IFRS. The Company believes that securities analysts, investors and other interested parties frequently use non-IFRS financial measures in the evaluation of issuers. The Company’s management also uses non-IFRS financial measures in order to facilitate operating performance comparisons from period to period.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains forward-looking statements and information within the meaning of applicable securities legislation. Forward-looking statements can be identified by the expressions “seeks”, “expects”, “believes”, “estimates”, “will”, “target” and similar expressions. The forward-looking statements are not historical facts but reflect the current expectations of the Company regarding future results or events and are based on information currently available to it. Certain material factors and assumptions were applied in providing these forward-looking statements. The forward-looking statements discussed in this release include, but are not limited to, statements about the benefits of the closing of the acquisition of a minority interest in Runway as well as the proposed transaction involving the Company and 180 Degree Capital, including future financial and operating results, the Company’s and 180 Degree Capital’s plans, objectives, expectations and intentions, the expected timing and likelihood of completion of the proposed transaction, the regulatory environment in which the Company operates, and the results of, or outlook for, the Company’s operations or for the Canadian and U.S. economies, statements relating to the Company’s continued transition to an asset management and insurance platform business and the entering into of further strategic transactions to diversify the Company’s business and further grow recurring management fee and other income and increasing Ability’s assets; the Company’s plans to focus Ability’s business on the reinsurance of annuity products; the potential benefits of combining Mount Logan’s and Ovation’s platform including an increase in fee-related earnings as a result of the acquisition; the decrease in expenses in the asset management segment; the historical growth in the asset management segment and insurance segment being an indicator for future growth; the growth and scalability of the Company’s business the Company’s business strategy, model, approach and future activities; portfolio composition and size, asset management activities and related income, capital raising activities, future credit opportunities of the Company, portfolio realizations, the protection of stakeholder value; the expansion of the Company’s loan portfolio; synergies to be achieved by both the Company and Runway through the Company’s strategic minority investment in Runway; and the expansion of Mount Logan’s capabilities. All forward-looking statements in this press release are qualified by these cautionary statements. The Company believes that the expectations reflected in forward-looking statements are based upon reasonable assumptions; however, the Company can give no assurance that the actual results or developments will be realized by certain specified dates or at all. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations, including that the Company has a limited operating history with respect to an asset management oriented business model; Ability may not generate recurring asset management fees, increase its assets or strategically benefit the Company as expected; the expected synergies by combining the business of Mount Logan with the business of Ability may not be realized as expected; the risk that Ability may require a significant investment of capital and other resources in order to expand and grow the business; the Company does not have a record of operating an insurance solutions business and is subject to all the risks and uncertainties associated with a broadening of the Company’s business; ability to obtain the requisite Company and 180 Degree Capital shareholder approvals, as well as governmental and regulatory approvals required for the proposed transaction with 180 Degree Capital, the risk that an event, change or other circumstance could give rise to the termination of the proposed transaction with 180 Degree Capital, the risk that a condition to closing of the proposed transaction with 180 Degree Capital may not be satisfied, the risk of delays in completing the proposed transaction with 180 Degree Capital, the risk that the businesses of the Company and with 180 Degree Capital will not be integrated successfully, the risk that the expected synergies of the acquisition of Ovation may not be realized as expected and the matters discussed under “Risks Factors” in the most recently filed annual information form and management discussion and analysis for the Company. Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, a forward-looking statement speaks only as of the date on which such statement is made. The Company undertakes no obligation to publicly update any such statement or to reflect new information or the occurrence of future events or circumstances except as required by securities laws. These forward-looking statements are made as of the date of this press release.

This press release is not, and under no circumstances is it to be construed as, a prospectus or an advertisement and the communication of this release is not, and under no circumstances is it to be construed as, an offer to sell or an offer to purchase any securities in the Company or in any fund or other investment vehicle. This press release is not intended for U.S. persons. The Company’s shares are not and will not be registered under the U.S. Securities Act of 1933, as amended, and the Company is not and will not be registered under the U.S. Investment Company Act of 1940 (the “1940 Act”). U.S. persons are not permitted to purchase the Company’s shares absent an applicable exemption from registration under each of these Acts. In addition, the number of investors in the United States, or which are U.S. persons or purchasing for the account or benefit of U.S. persons, will be limited to such number as is required to comply with an available exemption from the registration requirements of the 1940 Act.

Contacts:
Mount Logan Capital Inc.

365 Bay Street, Suite 800
Toronto, ON M5H 2V1
info@mountlogancapital.ca

Nikita Klassen
Chief Financial Officer
Nikita.Klassen@mountlogancapital.ca

Scott Chan
Investor Relations
Scott.Chan@mountlogan.com


MOUNT LOGAN CAPITAL INC. CONSOLIDATED STATEMENT OF FINANCIAL POSITION (in thousands of United States dollars, except share and per share amounts)

As at	Notes	March 31, 2025			December 31, 2024
ASSETS
*Asset Management:*
Cash		$	2,563		$	8,933
Investments	6		25,605			21,668
Intangible assets	9		24,064			24,801
Other assets			8,622			8,187
Total assets — asset management			60,854			63,589
*Insurance:*
Cash and cash equivalents			123,245			77,055
Restricted cash posted as collateral	18		12,526			15,716
Investments	6		1,019,969			1,045,436
Reinsurance contract assets	13		408,492			392,092
Intangible assets	9		2,444			2,444
Goodwill	9		55,015			55,015
Other assets			21,298			38,183
Total assets — insurance			1,642,989			1,625,941
Total assets		$	1,703,843		$	1,689,530
LIABILITIES
*Asset Management*
Due to affiliates	10	$	8,994		$	10,470
Debt obligations	12		78,401			78,427
Derivatives – debt warrants	12		737			504
Accrued expenses and other liabilities			9,770			5,097
Total liabilities — asset management			97,902			94,498
*Insurance*
Debt obligations	12		17,250			14,250
Insurance contract liabilities	13		1,069,625			1,048,413
Investment contract liabilities	14		222,074			227,041
Derivatives	18		1,864			5,192
Funds held under reinsurance contracts			238,371			239,918
Accrued expenses and other liabilities			7,856			2,995
Total liabilities — insurance			1,557,040			1,537,809
Total liabilities			1,654,942			1,632,307
EQUITY
Common shares	11		121,372			116,118
Warrants	11		1,129			1,129
Contributed surplus			8,063			7,917
Surplus (Deficit)			(59,805	)		(46,083	)
Cumulative translation adjustment			(21,858	)		(21,858	)
Total equity			48,901			57,223
Total liabilities and equity		$	1,703,843		$	1,689,530


MOUNT LOGAN CAPITAL INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (in thousands of United States dollars, except share and per share amounts)

		Three months ended
	Notes	March 31, 2025			March 31, 2024

REVENUE
*Asset management*
Management and incentive fee	7	$	2,928		$	3,494
Equity investment earning			282			224
Interest income			268			271
Dividend income			38			112
other Income			299
Net gains (losses) from investment activities	4		(623	)		(71	)
Total revenue — asset management			3,192			4,030
*Insurance*
Insurance revenue	8		23,389			22,741
Insurance service expenses	8		(25,534	)		(25,184	)
Net expenses from reinsurance contracts held	8		(52	)		(649	)
Insurance service result			(2,197	)		(3,092	)
Net investment income	5		19,004			21,804
Net gains (losses) from investment activities	4		6,958			2,666
Realized and unrealized gains (losses) on embedded derivative — funds withheld			(4,783	)		(3,829	)
Other income			—			6
Total revenue, net of insurance service expenses and net expenses from reinsurance contracts held — insurance			18,982			17,555
Total revenue			22,174			21,585
EXPENSES
*Asset management*
Administration and servicing fees	10		1,237			1,423
Transaction costs			4,545			251
Amortization and impairment of intangible assets	9		737			346
Interest and other credit facility expenses	12		1,857			1,702
General, administrative and other			4,202			3,893
Total expenses — asset management			12,578			7,615
*Insurance*
Net insurance finance (income) expenses	5		17,808			(7,252	)
Increase (decrease) in investment contract liabilities	14		1,957			2,279
(Increase) decrease in reinsurance contract assets			966			3,556
General, administrative and other			2,549			2,239
Total expenses — insurance			23,280			822
Total expenses			35,813			8,437
Income (loss) before taxes			(13,684	)		13,148
Income tax (expense) benefit — asset management	15		361			(56	)
Net income (loss) and comprehensive income (loss)		$	(13,323	)	$	13,092
Earnings per share
Basic		$	(0.48	)	$	0.51
Diluted		$	(0.48	)	$	0.50
Dividends per common share — USD		$	0.01		$	0.02
Dividends per common share — CAD		$	0.02		$	0.02

¹The yield is calculated based on the net investment income less management fees paid to Mount Logan divided by the average of investments in financial assets for the current year and prior year.

The MIL Network –

May 16, 2025

MIL-OSI USA: Read More (Rep. Steube and Sen. Moody Introduce Tax Relief for Victims of Crimes, Scams, and Disasters Act)

Source: United States House of Representatives – Congressman Greg Steube (FL-17)

May 15, 2025 | Press ReleasesWASHINGTON — U.S. Representative Greg Steube (R-Fla.) and Senator Ashley Moody (R-Fla.) today introduced the Tax Relief for Victims of Crimes, Scams, and Disasters Act to restore the casualty and theft loss tax deduction for Americans who have suffered devastating losses from fraud, cybercrime, structural home failures, or natural disasters.Under current law, taxpayers can only deduct casualty and theft losses if the loss occurred in a federally declared disaster area. This recent restriction, which has been a burden on so many Florida seniors and families, is on a previously allowed deduction dating back to before the start of the federal income tax which allowed many victims to deduct losses on assets they no longer possess. The Tax Relief for Victims of Crimes, Scams, and Disasters Act restores this deduction and retroactively applies it for tax years 2018 through 2024, providing much-needed relief to victims of theft.This bill addresses the recent policy recommendations by National Taxpayer Advocate Erin M. Collins, who was appointed by Treasury Secretary Steven Mnuchin during the Trump Administration.“Hardworking Americans, especially seniors, who fall victim to scams, cybercrime, or disasters should not be forced to pay taxes on income they no longer have,” said Rep. Steube. “Victims of crime, calamity, and fraud deserve peace of mind as they work to regain their footing. This bill protects Americans who have lost everything by restoring fairness and common sense to the tax code.”“As hurricane season is around the corner, I will continue supporting policies that protect Floridians from scammers and fraudsters,” said Senator Moody. “My Tax Relief for Victims of Crimes, Scams and Disasters Act will provide commonsense tax relief for victims, often seniors, who have been financially devastated by scams, crimes, or destruction from disasters. This legislation will help folks get back on their feet when they experience hardship. When I was Attorney General of Florida, I made sure to fight for Floridians who fell victim to scams, and I will continue bringing this fight to D.C. so that folks have the protections they need.”The Tax Relief for Victims of Crimes, Scams, and Disasters Act is supported by the AARP, AICPA-CIMA, AMAC Action, American Land Title Association, CFP Board, The Elder Justice Coalition, Family Business Coalition, Financial Services Institute, Investment Advisers Association, the National Association of Consumer Advocates, National Association of Enrolled Agents, National Association of Realtors, Operation Shamrock, and National Association of Government Defined Contribution Administrators (NAGDCA).
“Family-owned businesses are built over generations, and when they fall victim to scams, disasters, or structural failures, the impact is devastating. Congressman Steube’s Tax Relief for Victims of Crimes, Scams, and Disasters Act restores a vital protection in the tax code that ensures these families aren’t taxed on income they’ve lost through no fault of their own. This is a common-sense targeted fix that reflects the realities family businesses face today.” —Palmer Schoening, Chairman of Family Business Coalition Background:Along with their work on the Tax Relief for Victims of Crimes, Scams, and Disasters Act, Representative Steube and Senator Moody have championed the needs of victims of natural disasters and scams. In the last Congress, Representative Steube’s bipartisan Federal Disaster Tax Relief Act was passed and signed into law. This casualty loss legislation delivered much-needed tax relief for victims of disasters across 48 states between 2021 and 2025. While serving as Florida Attorney General, Moody helped lead the fight to prevent cybercriminals from targeting senior citizens, including shutting down six cyber schemes in less than three months in 2024.
Read the full bill here.

MIL OSI USA News –

May 16, 2025

MIL-OSI USA: Two Men Sentenced for Real Estate and Tax Fraud

Source: US Justice – Antitrust Division

Headline: Two Men Sentenced for Real Estate and Tax Fraud

Two men were sentenced to prison for a wire and tax fraud scheme to obtain title to a $1.3 million home in Roanoke County, Virginia. Herman Estes Jr. of Fieldale Virginia was sentenced to 84 months in prison; his co-conspirator Daniel Heggins of Charlotte, North Carolina was sentenced to 24 months in prison.

MIL OSI USA News –

May 16, 2025

MIL-OSI USA: Justice Department Seeks to Shut Down Chicago-Area Tax Preparer for Allegedly Fabricating Credits, Expenses, and Deductions on Customer Returns

Source: US Justice – Antitrust Division

Headline: Justice Department Seeks to Shut Down Chicago-Area Tax Preparer for Allegedly Fabricating Credits, Expenses, and Deductions on Customer Returns

The Justice Department filed a complaint in a federal court in Chicago seeking to permanently bar tax preparer Stacy Thomas, of Orland Park, Illinois, individually and doing business as Rapid Tax Refunds LLC, Rapid Tax Refund Profs LLC, and Rapid Refunds Income Tax Service Inc., from preparing federal tax returns for others.

MIL OSI USA News –

May 16, 2025

MIL-OSI United Kingdom: TUV Representatives Attend Balmoral Show

Source: Traditional Unionist Voice – Northern Ireland

TUV representatives from all levels of government were pleased to attend this year’s Balmoral Show. Under blue skies and amidst strong crowds, our team engaged with many members of the farming community to listen, discuss and stand alongside them on the pressing issues facing agriculture today.

Across countless conversations, the same key concerns emerged:
• Labour’s proposed plans to extend Inheritance Tax – a direct threat to family farms.
• Stormont’s new Nutrient Action Plan – viewed by many as unworkable and deeply unfair to local producers.
• The ongoing crisis of Bovine TB – a long-standing issue that still lacks effective resolution.

Many livestock and poultry breeders raised concerns over continuing difficulties in moving animals across the Irish Sea Border — whether for shows, sales, or the introduction of new bloodlines to pedigree stock. The end of the grace period for veterinary medicines from GB to Northern Ireland in December 2025 also remains a critical worry for many.

Added to this are growing national and international pressures:
• The trade deal to import beef from America.
• GB’s ongoing challenges with Bluetongue.
• Europe’s outbreak of Foot and Mouth Disease.

These are not abstract concerns — they are matters which threaten livelihoods, food security, and the future of rural life.

The TUV remains resolutely committed to speaking up for our farming and agri-food sector — in Westminster, Stormont, and local councils. We will continue to stand against policies that punish our producers and defend Northern Ireland’s right to trade and farm freely within our own country.

MIL OSI United Kingdom –

May 16, 2025

MIL-OSI: Banzai Reports First Quarter 2025 Financial Results

Source: GlobeNewswire (MIL-OSI)

Revenue of $3.4 Million for Q1 2025, Representing 213% Growth from Q1 2024

Gross Profit of $2.8 Million for Q1 2025, Representing 297% Growth from Q1 2024; Gross Margin Expanded to 82.1% in Q1 2025 from 64.7% in Q1 2024

Q1 2025 Net Loss Improved to ($3.6) Million from ($7.9) Million in Q4 2024, Positioning the Company to Cash Break-Even Operations in FY2025

Management to Host First Quarter 2025 Results Conference Call Today, Thursday, May 15, 2025 at 5:45 p.m. Eastern Time

SEATTLE, May 15, 2025 (GLOBE NEWSWIRE) — Banzai International, Inc. (NASDAQ: BNZI) (“Banzai” or the “Company”), a leading marketing technology company that provides essential marketing and sales solutions, today reported financial results for the first quarter ended March 31, 2025.

First Quarter 2025 and Subsequent Key Financial & Operational Highlights

Revenue of $3.4 million for Q1 2025, representing an increase of 213% million over Q1 2024 and a 160% sequential increase.
Gross profit of $2.8 million for Q1 2025, representing an increase of 297% over Q1 2024. Gross margin was 82.1% in Q1 2025, compared to 64.7% in Q1 2024.
Annual Recurring Revenue (ARR) of $14.9 million for Q1 2025. This represents a 268% annualized ARR growth rate compared to Q4 2024.
Q1 2025 Net Loss was ($3.6) million, a $4 million sequential improvement from Q4 2024 Net Loss of ($7.9) million.
Q1 2025 Adjusted EBITDA was ($1.7) million, compared to ($1.5) million in Q1 2024.
Completed acquisition of Vidello, Ltd. (“Vidello”) on January 31, 2025.
Signed a definitive agreement to acquire Act-On Software Inc. (“Act-On”), an enterprise marketing automation platform (MAP) provider, which is projected to increase revenue by $27 million for the twelve-month period ending December 31, 2025, on a pro-forma basis, when completed; acquisition subject to closing conditions.
Completed ahead-of-schedule repayment of $20.3 million of outstanding liabilities as of March 31, 2025, pursuant to the $24.8 million debt payoff and restructuring agreements announced on September 24, 2024.
Expanded customer base to over 90,000 total customers.

“In the first quarter, as our Vidello and OpenReel businesses continued to drive revenue momentum, we also focused on shoring up the financial strength of the company,” said Joe Davy, Founder and CEO of Banzai. “Revenue was $3.3 million for the first quarter of 2025, representing a 207% increase from the prior year from continued strong performance for our products. We closed the acquisition of Vidello in February, and progress continued toward closing the acquisition of Act-On Software, which is projected to increase revenue by $27 million for the full year 2025 on a pro-forma basis when completed, which remains subject to the satisfaction or waiver of closing conditions and therefore there is no guarantee it will be completed or provide such revenue.

“For the first quarter, we achieved a 268% annualized Annual Recurring Revenue growth rate. Growth was driven by our focus on mid-market and enterprise customers, and on the Reach product through re-engineering and expanded sales efforts. In total, we now serve over 90,000 customers.

“We made significant improvements to our balance sheet and cost structure, which we believe will position us for sustainable profitability in the future. With the investment in our Vidello acquisition, we further improved our financial position and flexibility with a $5.1 million year over year improvement in stockholders’ equity to a positive $2.4 million as of March 31, 2025. We also implemented a strategic initiative that we expect will enable us to significantly improve net income, substantially extend our cash runway, and invest in growth. We are making significant progress toward these goals and overall improvement in net income is expected to be approximately $13.5 million annually when fully implemented, while maintaining our growth outlook.

“In the first quarter Banzai secured expanded agreements with several prominent enterprises including RBC Capital Markets for our OpenReel solution, further cementing OpenReels position as a leading digital video creation platform for enterprise marketing teams. These agreements further validate our expansion strategy in the enterprise and mid-market. We are seeing solid traction in the financial sector, where the OpenReel Creator tool gives global financial firms the ability to offer standardized branded video with personalization at scale for their wealth managers, partners, and other stakeholders.

“To better serve our customers, we have continued to invest in our products and growth initiatives. We launched CreateStudio 4.0, with major A.I. enhancements for video creation including new A.I. builders, hook generators and assistant, and improved audio visualizer, call-to-action, and UI improvements.

“Looking ahead, our acquisitions have allowed us to build an integrated platform of AI-powered MarTech solutions that is driving strong growth with its marketing results. We are focused on adding innovative new products and capabilities that will provide compelling solutions for our clients and further our market reach. As we continue to invest in our software platform, sales and marketing, product development, acquisition strategy and other organic growth initiatives, we are managing costs efficiently. We are also continuing to strengthen our capital structure and balance sheet, to deliver a material benefit to both net income and shareholders’ equity. We look forward to additional updates on our anticipated milestones in the weeks and months to come,” concluded Davy.

First Quarter 2025 Financial Results

Banzai believes its non-GAAP financial measure ARR is more meaningful in evaluating its performance. The Company’s management team evaluates its financial and operating results utilizing this non-GAAP measure. For the three months ended March 31, 2025, ARR increased to $14.9 million, representing a 268% annualized ARR growth rate.

Total revenue for the three months ended March 31, 2025, was $3.4 million, a sequential increase of 160% from the three months ended December 31, 2024, and an increase of 213% compared to the prior year quarter.

Total cost of revenue for the three months ended March 31, 2025 was $0.6 million, compared to $0.4 million in the prior year quarter, an increase of 59%. The increase was proportional to the revenue for the corresponding period.

Gross profit for the three months ended March 31, 2025, was $2.8 million, compared to $0.7 million in the prior year quarter. Gross margin was 82.1% in the first quarter of 2025, compared to 64.7% in the first quarter of 2024.

Total operating expenses for the three months ended March 31, 2025, were $7.7 million, compared to $4.1 million in the prior year quarter. The increase in operating expenses were primarily due to the additions of OpenReel and Vidello and overall operating expenses.

Net loss for the three months ended March 31, 2025, was $3.6 million, compared to $4.3 million in the prior year quarter.

Adjusted EBITDA for the three months ended March 31, 2025, was ($1.7) million, compared to Adjusted EBITDA of ($1.5) million for the prior year quarter. This period-over-period decrease is primarily attributable to increased gain on extinguishments of liabilities offset by loss on issuance of term notes and increased transaction related expenses.

Net cash used in operating activities for the three months ended March 31, 2025, was $5.0 million, compared to $2.1 million for the three months ended March 31, 2024.

Cash totaled $0.8 million as of March 31, 2025, compared to $1.1 million as of December 31, 2024.

Annual Recurring Revenue (“ARR”) refers to annual run-rate revenue of subscription agreements from all customers in the last month of the measured period. These statements are forward-looking and actual ARR may differ materially. Refer to the “Forward-Looking Statements” section below for information on the factors that could cause Banzai’s actual ARR to differ materially from these forward-looking statements.

First Quarter 2025 Results Conference Call

Banzai Founder & CEO Joe Davy and Interim CFO Alvin Yip will host the conference call, followed by a question-and-answer session. The conference call will be accompanied by a presentation, which can be viewed during the webcast or accessed via the investor relations section of the Company’s website here.

To access the call, please use the following information:

A replay of the webcast and the presentation utilized during the call will be available in the Company’s investor relations section here.

Note About Non-GAAP Financial Measures

Adjusted EBITDA

In addition to our results determined in accordance with U.S. GAAP, we believe that Adjusted EBITDA, a non-GAAP measure as defined below, is useful in evaluating our operational performance distinct and apart from certain irregular, non-cash, and non-operational expenses. We use this information for ongoing evaluation of operations and for internal planning purposes. We believe that non- GAAP financial information, when taken collectively with results under GAAP, may be helpful to investors in assessing our operating performance and comparing our performance with competitors and other comparable companies.

Non-GAAP measures should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. We endeavor to compensate for the limitation of Adjusted EBITDA, by also providing the most directly comparable GAAP measure, which is net loss, and a description of the reconciling items and adjustments to derive the non-GAAP measure.

Adjusted EBITDA should only be considered alongside results prepared in accordance with GAAP, including various cash-flow metrics, net income (loss) and our other GAAP results and financial performance measures.

Net Income/(Loss) to Adjusted EBITDA Reconciliation

	Three Months Ended *March 31,*			Three Months Ended *March 31,*			Period- over-			Period- over-
($ in Thousands)	*2025*			*2024*			*Period $*			*Period %*
Net loss	$	(3,644	)	$	(4,291	)	$	647			-15.1	%
Depreciation expense		247			2			245			12250.0	%
Stock based compensation		337			43			294			685.9	%
Interest expense		—			451			(451	)		-100.0	%
Interest expense – related party		358			578			(220	)		-38.1	%
Income tax expense		74			(1	)		75			-7500.0	%
GEM commitment fee expense		–			200			(200	)		-100.0	%
Gain on extinguishment of liabilities		(4,343	)		(528	)		(3,815	)		722.5	%
Loss on debt issuance		274			171			103			60.2	%
Loss on issuance of term notes		1,770			—			1,770		nm
Change in fair value of warrant liability		(4	)		(408	)		404			-99.0	%
Change in fair value of warrant liability – related party		2			(115	)		117			-101.7	%
Change in fair value of bifurcated embedded derivative liabilities – related party		43			–			43		nm
Change in fair value of convertible notes		159			544			(385	)		-70.8	%
Change in fair value of term notes		166			—			166		nm
Change in fair value of convertible bridge notes		(22	)		—			(22	)	nm
Loss on yorkville sepa advances		385			—			385		nm
Other expense, net		(125	)		(4	)		(121	)		3025.0	%
Transaction related expenses*		2,582			1,842			740			40.2	%
Adjusted EBITDA (Loss)	$	(1,742	)	$	(1,512	)	$	(230	)		15.2	%

About Banzai

Banzai is a marketing technology company that provides AI-enabled marketing and sales solutions for businesses of all sizes. On a mission to help their customers grow, Banzai enables companies of all sizes to target, engage, and measure both new and existing customers more effectively. Customers who use Banzai’s product suite include Autodesk, Dell Technologies, New York Life, Thermo Fisher Scientific, Thinkific, and ActiveCampaign, among thousands of others. Learn more at www.banzai.io. For investors, please visit https://ir.banzai.io.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements often use words such as “believe,” “may,” “will,” “estimate,” “target,” “continue,” “anticipate,” “intend,” “expect,” “should,” “would,” “propose,” “plan,” “project,” “forecast,” “predict,” “potential,” “seek,” “future,” “outlook,” and similar variations and expressions. Forward-looking statements are those that do not relate strictly to historical or current facts. Examples of forward-looking statements may include, among others, statements regarding Banzai International, Inc.’s (the “Company’s”): future financial, business and operating performance and goals; annualized recurring revenue and customer retention; ongoing, future or ability to maintain or improve its financial position, cash flows, and liquidity and its expected financial needs; potential financing and ability to obtain financing; acquisition strategy and proposed acquisitions and, if completed, their potential success and financial contributions; strategy and strategic goals, including being able to capitalize on opportunities; expectations relating to the Company’s industry, outlook and market trends; total addressable market and serviceable addressable market and related projections; plans, strategies and expectations for retaining existing or acquiring new customers, increasing revenue and executing growth initiatives; and product areas of focus and additional products that may be sold in the future. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Forward-looking statements are not guarantees of future performance, and our actual results of operations, financial condition and liquidity and development of the industry in which the Company operates may differ materially from those made in or suggested by the forward-looking statements. Therefore, investors should not rely on any of these forward-looking statements. Factors that may cause actual results to differ materially include changes in the markets in which the Company operates, customer demand, the financial markets, economic, business and regulatory and other factors, such as the Company’s ability to execute on its strategy. More detailed information about risk factors can be found in the Company’s Annual Report on Form 10-K and the Company’s Quarterly Reports on Form 10-Q under the heading “Risk Factors,” and in other reports filed by the Company, including reports on Form 8-K. The Company does not undertake any duty to update forward-looking statements after the date of this press release.

Investor Relations
Chris Tyson
Executive Vice President
MZ Group – MZ North America
949-491-8235
BNZI@mzgroup.us
www.mzgroup.us

Media
Nancy Norton
Chief Legal Officer, Banzai
media@banzai.io

BANZAI INTERNATIONAL, INC. Consolidated Balance Sheets

	March 31, 2025			December 31, 2024
	(Unaudited)
ASSETS
Current assets:
Cash	$	780,764		$	1,087,497
Accounts receivable, net of allowance for credit losses of $14,503 and $24,210, respectively		1,028,379			936,321
Prepaid expenses and other current assets		831,394			643,674
Total current assets		2,640,537			2,667,492

Property and equipment, net		10,889			3,539
Intangible assets, net		8,936,187			3,883,853
Goodwill		21,991,721			18,972,475
Operating lease right-of-use assets		66,896			72,565
Bifurcated embedded derivative asset – related party		20,000			63,000
Other assets		13,984			11,154
Total assets		33,680,214			25,674,078

LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable		2,830,450			7,782,746
Accrued expenses and other current liabilities		4,030,965			3,891,018
Convertible notes (Yorkville)		1,684,000			—
Convertible notes – related party		8,104,901			8,639,701
Convertible notes		—			215,057
Notes payable, carried at fair value		5,949,001			3,575,000
Warrant liability		11,000			15,000
Warrant liability – related party		4,600			2,300
Earnout liability		2,046,370			14,850
Due to related party		167,118			167,118
Deferred revenue		4,419,195			3,934,627
Operating lease liabilities, current		23,485			22,731
Total current liabilities		29,271,085			28,260,148

Deferred revenue, non-current		111,161			117,643
Deferred tax liability		1,309,333			10,115
Operating lease liabilities, non-current		43,765			49,974
Total liabilities		30,735,344			28,437,880

Commitments and contingencies (Note 15)

Stockholders’ equity (deficit):
Common stock, $0.0001 par value, 275,000,000 (250,000,000 Class A and 25,000,000 Class B) shares authorized and 14,686,775 (12,375,641 Class A and 2,311,134 Class B) and 8,195,163 (5,884,029 Class A and 2,311,134 Class B) issued and outstanding at March 31, 2025 and December 31, 2024, respectively		1,450			800
Preferred stock, $0.0001 par value, 75,000,000 shares authorized, 1 and 1 shares issued and outstanding at March 31, 2025 and December 31, 2024		—			—
Additional paid-in capital		84,866,612			75,515,111
Accumulated deficit		(81,923,192	)		(78,279,713	)
Stockholders’ equity (deficit)		2,944,870			(2,763,802	)
Total liabilities and stockholders’ equity (deficit)	$	33,680,214		$	25,674,078

BANZAI INTERNATIONAL, INC. Unaudited Condensed Consolidated Statements of Operations

	For the Three Months Ended March 31,
	2025			2024

Revenue	$	3,379,083		$	1,079,472
Cost of revenue		605,999			381,380
Gross profit		2,773,084			698,092

Operating expenses:
General and administrative expenses		7,433,088			4,098,789
Depreciation and amortization expense		246,691			1,564
Total operating expenses		7,679,779			4,100,353

Operating loss		(4,906,695	)		(3,402,261	)

Other expenses (income):
GEM settlement fee expense		—			200,000
Interest income		(2	)		(10	)
Interest expense		—			451,399
Interest expense – related party		358,381			577,513
Gain on extinguishment of liabilities		(4,343,406	)		(527,980	)
Loss on debt issuance		273,800			171,000
Loss on extinguishment of term notes		1,769,895			—
Change in fair value of warrant liability		(4,000	)		(408,000	)
Change in fair value of warrant liability – related party		2,300			(115,000	)
Change in fair value of bifurcated embedded derivative assets – related party		43,000			—
Change in fair value of convertible notes		159,100			544,000
Change in fair value of term notes		165,906			—
Change in fair value of convertible bridge notes		(21,714	)		—
Loss on Yorkville SEPA advances		384,524			—
Other income, net		(124,531	)		(4,118	)
Total other (income) expenses, net		(1,336,747	)		888,804
Loss before income taxes		(3,569,948	)		(4,291,065	)
Income tax expense (benefit)		73,531			(933	)
Net loss		(3,643,479	)		(4,290,132	)

Net loss attributable to common shareholders	$	(3,643,479	)	$	(4,290,132	)

Net loss per share attributable to common shareholders
Basic and diluted	$	(0.15	)	$	(1.64	)

Weighted average common shares outstanding
Basic and diluted		23,963,166			2,612,025

BANZAI INTERNATIONAL, INC. Unaudited Condensed Consolidated Statements of Cash Flows

	For the Three Months Ended March 31,
	2025			2024
Cash flows from operating activities:
Net loss	$	(3,643,479	)	$	(4,290,132	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense		246,691			1,564
Provision for credit losses on accounts receivable		(9,707	)		(2,191	)
Non-cash share issuance for marketing expenses		—			48,734
Non-cash shares issued for consulting expenses		232,500			—
Non-cash settlement of GEM commitment fee		—			200,000
Discount at issuance on notes carried at fair value		16,200			—
Non-cash interest expense		—			374,944
Non-cash interest expense – related party		336,275			87,758
Amortization of debt discount and issuance costs		(885	)		30,027
Amortization of debt discount and issuance costs – related party		—			489,755
Amortization of operating lease right-of-use assets		5,669			43,705
Stock based compensation expense		336,568			42,827
Gain on extinguishment of liability		(4,343,406	)		(527,980	)
Loss on debt issuance		273,800			171,000
Loss on extinguishment of term notes		1,769,895			—
Loss on SEPA issuance		384,524			—
Change in fair value of warrant liability		(4,000	)		(408,000	)
Change in fair value of warrant liability – related party		2,300			(115,000	)
Change in fair value of bifurcated embedded derivative liabilities – related party		43,000			—
Change in fair value of convertible promissory notes		159,100			544,000
Change in fair value of term notes		165,906			—
Change in fair value of convertible bridge notes		(21,714	)		—
Changes in operating assets and liabilities:
Accounts receivable		(82,351	)		72,570
Prepaid expenses and other current assets		(187,720	)		(186,558	)
Other assets		(2,830	)		—
Accounts payable		(609,595	)		1,897,046
Deferred revenue		36,602			31,210
Accrued expenses		(212,557	)		(524,713	)
Operating lease liabilities		(5,455	)		(75,078	)
Earnout liability		170,481			(22,274	)
Deferred revenue – long-term		(6,482	)		—
Deferred tax liability		(25,032	)		—
Net cash used in operating activities		(4,975,702	)		(2,116,786	)
Cash flows from investing activities:
Cash paid in acquisition of Vidello, net of cash acquired		(2,677,480	)		—
Net cash used in investing activities		(2,677,480	)		—
Cash flows from financing activities:
Payment of GEM commitment fee promissory note		(215,057	)		(1,200,000	)
Repayment of convertible notes (Yorkville)		(1,877,100	)		—
Proceeds from term notes, net of issuance costs		4,000,000			—
Repayment of term notes		(3,686,086	)		—
Partial repayment of convertible notes – related party		(870,190	)		—
Proceeds from issuance of convertible notes, net of issuance costs		3,258,000			2,250,000
Proceeds from issuance of shares to Yorkville under the SEPA		6,687,082			—
Proceeds from shares issued to Verista		49,800			—
Net cash provided by financing activities		7,346,449			1,050,000
Net decrease in cash		(306,733	)		(1,066,786	)
Cash at beginning of period		1,087,497			2,093,718
Cash at end of period	$	780,764		$	1,026,932
Supplemental disclosure of cash flow information:
Cash paid for interest		—			44,814
Non-cash investing and financing activities
Shares issued to Roth for advisory fee		—			278,833
Shares issued to GEM		—			100,000
Shares issued for marketing expenses		—			194,935
Shares issued to Hudson for consulting fee		232,500			—
Settlement of GEM commitment fee		—			200,000
Consideration transferred for acquisition of Vidello		1,661,677			—
Assets acquired in acquisition of Vidello		8,393,172			—
Liabilities assumed in acquisition of Vidello		3,986,464			—
Shares issued to Yorkville of aggregate commitment fee		—			500,000
Conversion of convertible notes – Yorkville		—			1,667,000
Conversion of convertible notes – related party		—			2,540,091

The MIL Network –

May 16, 2025

MIL-OSI: Binah Capital Group Reports First Quarter 2025 Results

Source: GlobeNewswire (MIL-OSI)

– Grew Total Revenue 18% Year-over-Year to $49 Million –

– Assets Under Management (“AuM”) Increased 3% Year-over-Year to $26 Billion –

– Net Income of $1 Million –

– Increased EBITDA¹to $2.2 Million from $(0.0) Million in the Prior Year –

NEW YORK, May 15, 2025 (GLOBE NEWSWIRE) — Binah Capital Group, Inc. (“Binah”, “Binah Capital” or the “Company”) (NASDAQ: BCG; BCGWW), a leading financial services enterprise that owns and operates a network of industry-leading firms empowering independent financial advisors, today announced results for the quarter ended March 31, 2025.

“We once again delivered strong results, which is a continued testament to our differentiated RIA platform,” stated Craig Gould, Chief Executive Officer of Binah Capital Group. “Highlighting our business model’s sustained momentum and the effective execution of our growth initiatives, we achieved double-digit year-over-year growth in both revenue and EBITDA while delivering GAAP profitability in the first quarter. Subsequent to quarter-end, we were pleased to welcome Bleakley Financial Group to the Binah family, underscoring the strength of our open-architecture platform and the confidence that leading entrepreneurial firms place in Binah. Additionally, we further expanded and strengthened our executive leadership with the appointment of Ryan Marcus as our Chief Business Development and Engagement Officer. Looking ahead, we believe our resilient and differentiated platform leaves us well-positioned to navigate the dynamic macro environment and drive long-term shareholder value.”

First Quarter 2025 Key Highlights

Total advisory and brokerage assets in the first quarter grew 3% year-over-year to $26 billion.
Total revenue increased 18% year-over-year to $49 million.
Gross profit of $8.6 million, compared to $7.8 million in the prior-year period.
Total operating expenses were $7 million, compared to $10 million in the prior-year period. The change in operating expenses was primarily due to costs incurred in the prior-year period related to the consummation of the business combination but did not occur in the first quarter of 2025.
GAAP net income of $1 million, compared to GAAP net loss of $(1.6) million in the prior-year period.
EBITDA^* increased to $2.2 million, compared to an EBITDA of $(0.0) in the prior year period. The increase was primarily attributable to higher revenue growth and lower expenses, as the first quarter 2025 did not include the business combination related costs that occurred in the prior-year period.

Liquidity and Capital

The Company had cash and cash equivalents of $9 million and outstanding long-term debt of $25 million as of March 31, 2025.

_______________

* See “Non-GAAP Financial Measures” below for additional information and a reconciliation to GAAP for all Non-GAAP metrics.

About Binah Capital Group

Binah Capital Group (“Binah Capital”, “Binah” or the “Company,” is a financial services enterprise that owns and operates a network of industry-leading firms that empower independent financial advisors. As a national broker-dealer aggregator, Binah specializes in delivering value through its innovative hybrid-friendly model, making it an optimal platform for RIAs navigating today’s complex financial landscape. Binah’s portfolio companies are built to help advisors run, manage, and execute commission-based business seamlessly while providing best in class resources to support their advisory practice. We don’t just offer tools—we cultivate partnerships. Binah Capital Group stands alongside RIAs as a trusted ally, delivering the structure, flexibility, and cutting-edge solutions they need to succeed in an increasingly competitive marketplace.

For more, please visit: www.binahcap.com

Contact:

Binah Capital Investor Relations
ir@binahcap.com

Binah Capital Public Relations
media@binahcap.com

Non-GAAP Financial Measure

EBITDA is a non-GAAP financial measure, defined as net income (loss) adjusted for depreciation expense, amortization, interest expense and income tax. The Company presents EBITDA because management believes that it can be a useful financial metric in understanding the Company’s earnings from operations. EBITDA is not a measure of the Company’s financial performance under GAAP or liquidity and should not be considered as an alternative to net income or any other performance measure derived in accordance with GAAP. The principal limitations of EBITDA are that it excludes certain expenses that are required by U.S. GAAP to be recorded in our consolidated financial statements. In addition, EBITDA is subject to inherent limitations as these metrics reflect the exercise of judgment by management about which expenses are excluded or included in determining EBITDA. A reconciliation of EBITDA to Net income, the most directly comparable GAAP measure, appears below.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended that are intended to be subject to the “safe harbor” created by those sections and other applicable laws. These forward-looking statements rely on a number of assumptions concerning future events and are subject to a number of uncertainties and factors that could cause actual results to differ materially from such statements, many of which are outside the control of Binah. Forward-looking statements include, but are not limited to statements regarding: Binah’s financial and operational outlook; Binah’s operational and financial strategies, including planned growth initiatives and the benefits thereof, Binah’s ability to successfully effect those strategies, and the expected results therefrom. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “expect,” ‎‎”intend,” “anticipate,” “goals,” “prospects,” “will,” “would,” “will continue,” “will likely result,” and similar expressions (including the negative versions of such words or expressions).

While Binah believes that the assumptions concerning future events are reasonable, it cautions that there are inherent difficulties in predicting certain important factors that could impact the future performance or results of its business. The factors that could cause results to differ materially from those indicated by such forward-looking statements include, but are not limited to: our ability to comply with supervisory and regulatory compliance obligations, the risk we may be held liable for misconduct by our advisors; poor performance of our investment products and services; our ability to effectively maintain and enhance our brand and reputation; our ability to expand and retain our customer base; our future capital requirements and sources and uses of cash; the risk that an increase in government regulation of the industries and markets in which we operate could negatively impact our business; the impact of worldwide and regional political, military or economic conditions, including declines in foreign currencies in relation to the value of the U.S. dollar, hyperinflation, devaluation and significant political or civil disturbances in international markets; and the effectiveness of Binah’s control environment, including the identification of control deficiencies.

These forward-looking statements are also affected by the risk factors, forward-looking statements and challenges and uncertainties set forth in documents filed by Binah with ‎the U.S. Securities and Exchange Commission from time to time, including the Annual ‎Report on Form 10-K and Quarterly Reports on Form 10-Q and subsequent ‎periodic reports. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Binah cautions you not to place undue reliance on the ‎forward-looking statements contained in this press release. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and Binah assumes no obligation and, except as required by law, does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. Binah does not give any assurance that it will achieve its expectations.

Binah Capital Group Consolidated Balance Sheet

BINAH CAPITAL GROUP, INC. CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION MARCH 31, 2025 AND DECEMBER 31, 2024 (in thousands, except per share amounts)

	Unaudited
	March 31, 2025			December 31, 2024
ASSETS
Assets:
Cash, cash equivalents and restricted cash	$	8,821		$	8,486
Receivables, net:
Commission receivable		9,603			9,198
Due from clearing broker		565			873
Other		1,672			938
Property and equipment, net		511			599
Right of use assets		3,574			3,730
Intangible assets, net		933			1,021
Goodwill		39,839			39,839
Other assets		2,359			1,993

Total Assets	$	67,877		$	66,677

LIABILITIES AND STOCKHOLDERS’ EQUITY

Liabilities:
Accounts payable, accrued expenses and other liabilities	$	11,332		$	10,208
Commissions payable		11,460			11,468
Operating lease liabilities		3,675			3,820
Notes payable, net of unamortized debt issuance costs of $702 and $739 as of March 31, 2025 and December 31, 2024, respectively		19,091			19,561
Promissory notes-affiliates		5,313			5,442

Total Liabilities		50,870			50,499

Mezzanine Equity:
Redeemable Series A Convertible Preferred Stock, par value $0.0001, 2,000,000 shares authorized, 1,572,000 and 1,555,000 shares outstanding at March 31, 2025 and December 31, 2024		15,121			14,947
Stockholders’ Equity:
Series B Convertible Preferred Stock, par value $0.0001, 500,000 shares authorized, 150,000 shares outstanding at March 31, 2025 and December 31, 2024		1,500			1,500
Common stock, $0.0001 par value, 55,000,000 authorized, 16,602,460 issued and outstanding at March 31, 2025 December 31, 2024		—			—
Additional paid-in-capital		22,606			22,984
Accumulated deficit		(22,220	)		(23,253	)
Total Stockholders’ Equity and Mezzanine Equity		17,007			16,178

TOTAL LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY	$	67,877		$	66,677

Binah Capital Group Consolidated Statement of Operations

BINAH CAPITAL GROUP, INC. CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE PERIODS ENDED MARCH 31, 2025 AND 2024 (in thousands, except per share amounts)

	Three months ended March 31,
	2025		2024
Revenues:
Revenue from Contracts with Customers:
Commissions	$	41,141	$	34,395
Advisory fees		6,916		5,685
Total Revenue from Contracts with Customers		48,057		40,080
Interest and other income		879		1,369

Total revenues		48,936		41,449

Expenses:
Commissions and fees		40,298		33,655
Employee compensation and benefits		4,351		3,457
Rent and occupancy		285		295
Professional fees		536		4,337
Technology fees		753		362
Interest		566		1,062
Depreciation and amortization		187		301
Other		503		(578	)

Total expenses		47,479		42,891

Income (loss) before provision for income taxes		1,456		(1,442	)

Provision for income taxes		423		139

Net income (loss)	$	1,033	$	(1,581	)

Net income attributable to Legacy Wentworth Management Services LLC members		—		730

Net income (loss) attributable to Binah Capital Group, Inc.	$	1,033	$	(2,311	)

Net income (loss) per share basic and diluted	$	0.06	$	(0.14	)

Weighted average shares: basic and diluted		16,602		16,566

Binah Capital Group Reconciliation of GAAP Net Income to EBITDA

EBITDA is a non-GAAP financial measure. EBITDA is defined as net income plus interest expense, provision for income taxes, and depreciation and amortization. The Company presents EBITDA because management believes that it can be a useful financial metric in understanding the Company’s earnings from operations. EBITDA is not a measure of the Company’s financial performance under GAAP or liquidity and should not be considered as an alternative to net income or any other performance measure derived in accordance with GAAP.

Below is a reconciliation of net income to EBITDA for the periods presented (in millions):


	For the Three Months Ended March 31,
EBITDA Reconciliation	2025		2024
Net income (loss)	$	1.0		(1.5	)
Interest expense		0.6		1.1
Provision for income taxes		0.4		0.1
Depreciation and amortization		0.2		0.3
EBITDA	$	2.2		(0.0	)

_____________________________

¹Non-GAAP Financial Measures. EBITDA is a non-GAAP financial measure defined as net income (loss) adjusted for depreciation expense, amortization expense, interest expense, and income tax. See the section captioned “Non-GAAP Financial Measures” below for a detailed description and reconciliation of such Non-GAAP financial measures to their most directly comparable GAAP financial measures, as required by Regulation G.

The MIL Network –

May 16, 2025

MIL-OSI Security: Justice Department Seeks to Shut Down Chicago-Area Tax Preparer for Allegedly Fabricating Credits, Expenses, and Deductions on Customer Returns

Source: United States Attorneys General 1

Note: View the complaint here.

The Justice Department filed a complaint in a federal court in Chicago today seeking to permanently bar tax preparer Stacy Thomas, of Orland Park, Illinois, individually and doing business as Rapid Tax Refunds LLC, Rapid Tax Refund Profs LLC, and Rapid Refunds Income Tax Service Inc., from preparing federal tax returns for others.

The complaint alleges that Thomas and her businesses prepare and file false federal tax returns that understate her customers’ tax liabilities by claiming false residential energy credits, false Schedule C business expenses, and false charitable deductions. The government further alleges in the complaint that customers interviewed by the IRS confirmed that they never told Thomas they incurred the residential energy or business expenses or made the charitable contributions she reported on their income tax returns, and that Thomas claimed those items without their knowledge or consent.

According to the complaint, the IRS estimates that by repeatedly understating their customers’ tax liabilities, Thomas and her businesses have caused the United States to lose nearly $13 million in tax revenue.

The Justice Department’s Tax Division made the announcement.

Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams, and taxpayers seeking a return preparer should remain vigilant against unscrupulous tax preparers. The IRS has information on its website for choosing a tax return preparer and has launched a free directory of federal tax preparers. The IRS warns taxpayers to avoid “ghost preparers” and lists other improper acts that tax preparers engage in to take advantage of their unsuspecting customers.

In the past decade, the Justice Department’s Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.

MIL Security OSI –

May 16, 2025

MIL-OSI Security: Additional 12 Defendants Charged in RICO Conspiracy for over $263 Million Cryptocurrency Thefts, Money Laundering, Home Break-Ins

Source: Office of United States Attorneys

WASHINGTON – A four-count superseding indictment, unsealed today in U.S. District Court, charges 12 additional people – Americans and foreign nationals – for allegedly participating in a cyber-enabled racketeering conspiracy throughout the United States and abroad that netted them more than $263 million. Several were arrested this week in California, while two remain abroad and are believed to be living in Dubai.

The superseding indictment and the arrests were announced by U.S. Attorney Jeanine Ferris Pirro, FBI Special Agent in Charge Sean Ryan of the Washington Field Office Criminal and Cyber Division, and Executive Special Agent in Charge Kareem A. Carter of the Internal Revenue Service – Criminal Investigation Washington, D.C. Field Office.

The defendants, listed below, face charges that include RICO conspiracy, conspiracy to commit wire fraud, money laundering, and obstruction of justice. The superseding indictment adds charges originally brought against Malone Lam on Sept. 19, 2024.

According to the superseding indictment, the enterprise began no later than October 2023 and continued through March 2025. It grew from friendships developed on online gaming platforms.

Members of the enterprise held different responsibilities. The various roles included database hackers, organizers, target identifiers, callers, money launderers, and residential burglars targeting hardware virtual currency wallets.

Database hackers hacked websites and servers to obtain cryptocurrency-related databases or purchased databases on the darkweb. Organizers and target identifiers organized and collated information across the databases to determine the most valuable targets. Callers cold-called victims and used social engineering to convince them their accounts were the subject of cyberattacks and the enterprise callers were attempting to help secure their accounts. Money launderers received the stolen crypto currency and turned it into fiat U.S. currency in the form of bulk cash or wire transfers.

According to the indictment, members and associates of the enterprise used the stolen virtual currency to purchase, among other things, nightclub services ranging up to $500,000 per evening, luxury handbags valued in the tens of thousands of dollars that were given away at nightclub parties, luxury watches valued between $100,000 and $500,000, luxury clothing valued in the tens of thousands of dollars, rental homes in Los Angeles, the Hamptons, and Miami, private jet rentals, a team of private security guards, and a fleet of at least 28 exotic cars ranging in value from $100,000 to $3.8 million.

According to the indictment, members of the enterprise laundered stolen cryptocurrency proceeds by moving the funds through various mixers and exchanges using “peel chains,” pass-through wallets, and virtual private networks to mask their true identities.

The indictment alleges that in one instance on Aug. 18, 2024, Malone Lam and contacted a victim in D.C. and, through the communications with that victim, fraudulently obtained over 4,100 Bitcoin — worth over $230 million at the time. In another instance in July 2024, Malone Lam and others are accused of stealing over $14 million in cryptocurrency from an additional victim.

The indictment alleges that members of the enterprise also committed home break-ins. As alleged in the Indictment, Marlon Ferro traveled to New Mexico in July 2024 and broke into a victim’s home to steal their hardware virtual currency wallet while Lam monitored the victim’s location by logging into his iCloud account.

The superseding indictment also alleges that the enterprise engaged in significant money laundering activity. Kunal Mehta, Hamza Doost, Joel Cortez, and Evan Tangeman are alleged to have engaged in unlicensed crypto-to-cash services for the enterprise, obtained luxury rental homes for members of the enterprise using fake identity documents, booked private jet travel with stolen cryptocurrency for the enterprise, concealed ownership of exotic cars by registering them in shell company names, and shipped bulk cash through US mail to members of the enterprise hidden in squishmallow stuffed animals.

Following his arrest in September 2024 and continuing while in pretrial detention, Lam is alleged to have continued working with members of the enterprise to pass and receive directions, collect stolen cryptocurrency, and to have enterprise members buy luxury Hermes Birkin bags and hand deliver them to his girlfriend in Miami, Florida.

This ongoing investigation is being handled by the U.S. Attorney’s Office for the District of Columbia, the FBI’s Washington Field Office, and the IRS-Criminal Investigation Washington D.C. Field Office. Significant investigative and operational support was provided by the FBI’s Los Angeles and Miami field offices.

The matter is being prosecuted by Assistant United States Attorney Kevin Rosenberg, Acting Deputy Chief of the Fraud, Public Corruption, and Civil Rights Section of the U.S. Attorney’s Office for the District of Columbia.

If found guilty, the defendants’ sentences will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.

An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

Defendants

NAME, AGE, & ALLEGED ROLE

AKAs

HOMETOWN

CHARGES

Malone Lam, 20, Social Engineering, Organizer	“King Greavys,” “$$$,” “7,” “Kg,” “Anne Hathaway”	Miami, Florida, Los Angeles, Calif., Singapore	RICO Conspiracy, Conspiracy to Commit Wire Fraud, Conspiracy to Launder Monetary Instruments
Marlon Ferro, 19, Money Laundering, Residential Burglary	“Marlo,” “GothFerrari”	Santa Ana, California	RICO Conspiracy, Conspiracy to Commit Wire Fraud, Conspiracy to Launder Monetary Instruments
Hamza Doost, 21, Money Laundering	“Scyllia”	Hayward, California	RICO Conspiracy, Conspiracy to Launder Monetary Instruments
Conor Flansburg, 21, Database Hacker, Caller, and Organizer	“O O,” “Green Room,” “@d0uu0b”	Newport Beach, California	RICO Conspiracy, Conspiracy to Commit Wire Fraud
Kunal Mehta, 45, Money Laundering	“Papa,” “The Accountant,” “Shrek,” “Neil”	Irvine, California	RICO Conspiracy, Conspiracy to Launder Monetary Instruments
Ethan Yarally, 18, Caller	“Rand,” “15%”	Richmond Hill, New York	RICO Conspiracy, Conspiracy to Commit Wire Fraud
Cody Demirtas, 19, Caller	“KO,” “Kody”	Stuart, Florida	RICO Conspiracy, Conspiracy to Commit Wire Fraud
Aakash Anand, 22, Caller, Money Laundering	“Light,” “Dark”	New Zealand	RICO Conspiracy, Conspiracy to Commit Wire Fraud, Conspiracy to Launder Monetary Instruments
Evan Tangeman, 21, Money Laundering	“E,” “Tate,” “Evan \| Exchanger”	Newport Beach, California	RICO Conspiracy, Conspiracy to Launder Monetary Instruments
Joel Cortes, 21, Money Laundering	“J”	Laguna Niguel, California	RICO Conspiracy, Conspiracy to Launder Monetary Instruments
First Name Unknown-1 , Last Name Unknown-1, Database Hacker	“Chen,” “Squiggly”	Unknown	RICO Conspiracy, Conspiracy to Commit Wire Fraud, Conspiracy to Launder Monetary Instruments
First Name Unknown-2 , Last Name Unknown-2, Database Hacker	“Danny” “Meech”	Unknown	RICO Conspiracy, Conspiracy to Commit Wire Fraud, Conspiracy to Launder Monetary Instruments
John Tucker Desmond, 19, Destroyed Evidence	–	Huntington Beach, California	Obstruction of Justice

24cr417

MIL Security OSI –

May 16, 2025

MIL-OSI: FSI ANNOUNCES FIRST QUARTER, 2025 FINANCIAL RESULTS

Source: GlobeNewswire (MIL-OSI)

A CONFERENCE CALL IS SCHEDULED FOR FRIDAY, MAY 16, 2025, 11:00AM EASTERN TIME

SEE DIAL IN NUMBER BELOW

TABER, ALBERTA, May 15, 2025 (GLOBE NEWSWIRE) — FLEXIBLE SOLUTIONS INTERNATIONAL, INC. (NYSE Amex: FSI), is the developer and manufacturer of biodegradable polymers for oil extraction, detergent ingredients and water treatment as well as crop nutrient availability chemistry. Flexible Solutions also manufactures biodegradable and environmentally safe water and energy conservation technologies. FSI is also increasing its presense in the food and nutrition supplement manufacturing markets. Today the Company announces financial results for first quarter ended March 31, 2025.

Mr. Daniel B. O’Brien, CEO, states, “The customers who adjusted inventory in Q1 returned to normal order patterns in April.” Mr. O’Brien continues, “ENP also saw lower revenue, which has rebounded in Q2 and we had lower investment income as a result of reduced ownership in the FL LLC.”

Sales for the first quarter (Q1) were $7,473,692 down approximately 19% when compared to sales of $9,224,872 in the corresponding period a year ago.
Q1, 2025 net income (loss) was ($277,734), or ($0.02) compared to a net income of $457,226, or $0.04 per share, in Q1, 2024.
The lower earnings reported for Q1, 2025 were due to lower sales volume, higher cost of goods including higher tariffs. Some costs that are needed for the CAPEX get classified as expenses and are set against current income. Our costs for the Panama factory have similar accounting effects.
Basic weighted average shares used in computing earnings per share amounts were 12,587,476 and 12,449,699 for Q1, 2025 and Q1, 2024 respectively.
Q1, 2025 Non-GAAP operating cash flow: The Company shows 3 months operating cash flow of $480,268, or $0.04 per share. This compares with operating cash flow of $1,382,874, or $0.11 per share, in the corresponding 3 months of 2024 (see the table and notes that follow for details of these calculations).

The NanoChem division and ENP subsidiary continue to be the dominant sources of revenue and cash flow for the Company. New opportunities continue to unfold in detergent, water treatment, oil field extraction, turf, ornamental and agricultural use to further increase sales in these divisions. More recently, opportunities in the food and nutrition supplement manufacturing markets have emerged.

CONFERENCE CALL

A conference call has been scheduled for 11:00 am Eastern Time, 8:00 am Pacific Time, on Friday May 16th, 2025. CEO, Dan O’Brien will be presenting and answering questions on the conference call. To participate in this call please dial 1-888-999-5318 (or 1-848-280-6460) just prior to the scheduled call time. To join the call participants will be requested to give their name and company affiliation. The conference ID: SOLUTIONS and/or call title Flexible Solutions International – First Quarter, 2025 Financials may be requested

The above information and following table contain supplemental information regarding income and cash flow from operations for the period ended March 31, 2025. Adjustments to exclude depreciation, stock option expenses and one time charges are given. This financial information is a Non-GAAP financial measure as defined by SEC regulation G. The GAAP financial measure most directly comparable is net income.

The reconciliation of each Non-GAAP financial measure is as follows:

FLEXIBLE SOLUTIONS INTERNATIONAL, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
FOR THREE MONTHS ENDED MARCH 31, 2025 AND 2024
(THREE MONTHS OPERATING CASH FLOW – UNAUDITED)

	THREE MONTHS ENDED MARCH 31
	2025			2024
Revenue	$	7,473,692		$	9,224,872
Income (loss) before income tax – GAAP	$	(153,678	)	$	780,387
Provision for Income tax – net – GAAP	$	(110,363	)	$	(264,178	)
Net income (loss) – GAAP	$	(277,734	)	$	457,226
Net income (loss) per common share – basic. – GAAP	$	(0.02	)	$	0.04
3 month weighted average shares used in computing per share amounts – basic.- GAAP		12,587,476			12,449,699

		3 month Operating Cash Flow Ended March 31
Operating Cash Flow (3 months). NON-GAAP		$ 480,268 a,b,c			$ 1,382,874 a,b,c
Operating Cash Flow per share excluding non-operating items and items not related to current operations (3 months) – basic. –NON-GAAP		$ 0.04 a,b,c			$ 0.11 a,b,c
Non-cash Adjustments (3 month) –GAAP		$ 563,118 d			$ 676,026 d
Shares (3 month basic weighted average) used in computing per share amounts – basic –GAAP		12,587,476			12,449,699

Notes: certain items not related to “operations” of the Company’s net income are listed below.

a) Non-GAAP – Flexible Solutions International purchased 65% of ENP in 4^th quarter, 2018 (October 2018). Therefore Operating Cash Flow is adjusted by the pre tax Net income or loss of the non-controlling interest in ENP for 2023 only. After 2023 the entry in the “Statement of operations and comprehensive income” is a pretax number therefore no adjustment is required.
b) Non-GAAP – amounts exclude certain cash and non-cash items: Depreciation and Stock compensation expense (2025 = $563,118, 2024 = $676,026), Interest expense (2025 = $198,019, 2024 = $175,266), Interest income (2025 = 49,573, $2024 = $48,197), Loss on lease termination (2025 = N/A, 2024 = $41,350), Gain on investment (2025 = $63,925, 2024 = $182,975), Income tax expense (2025 = $110,363, 2024 = $264,178), and pretax Net income attributable to non-controlling interests (2025 = $13,693, 2024 = $58,983). These onetime expenditures were not related to operations of FSI. *See the financial statements for all adjustments.
c) The revenue and gain from the 50% investment in the private Florida LLC announced in January 2019 are not treated as revenue or profit from operations by Flexible Solutions given the Company does not have control. The profit is treated as investment income and therefore occurs below Operating income in the Statement of Operations. In August 2024, the Company sold 30.1% of its holdings in the Florida LLC and currently has a 19.9% share, with a contract in place to sell the remainder over the next five years. As a result, the gains from all investments (2025 = $63,925, 2024 = $182,975), including those from the Florida LLC, are removed from the calculation to arrive at Operating Cash Flow
d) Non-GAAP – amounts represent depreciation and stock compensation expense.

SAFE HARBOR PROVISION

The Private Securities Litigation Reform Act of 1995 provides a “Safe Harbor” for forward-looking statements. Certain of the statements contained herein, which are not historical facts, are forward looking statement with respect to events, the occurrence of which involve risks and uncertainties. These forward-looking statements may be impacted, either positively or negatively, by various factors. Information concerning potential factors that could affect the company is detailed from time to time in the company’s reports filed with the Securities and Exchange Commission.

Flexible Solutions International
6001 54^thAve, Taber, Alberta, CANADA T1G 1X4
Company Contacts

Jason Bloom
Toll Free: 800 661 3560
Fax: 403 223 2905
E-mail: info@flexiblesolutions.com

If you have received this news release by mistake or if you would like to be removed from our update list please reply to: info@flexiblesolutions.com

To find out more information about Flexible Solutions and our products, please visit www.flexiblesolutions.com.

The MIL Network –

May 16, 2025

MIL-OSI: Veeco Announces Private Exchanges and Cancellation of Remaining 3.75% Convertible Notes due 2027

Source: GlobeNewswire (MIL-OSI)

PLAINVIEW, N.Y., May 15, 2025 (GLOBE NEWSWIRE) — Veeco Instruments Inc. (NASDAQ: VECO) (the “Company” or “Veeco”) today announced that the Company completed separate exchange transactions (the “Exchanges”) pursuant to privately negotiated exchange agreements with the holders of all of its outstanding 3.75% Convertible Senior Notes due 2027 (the “2027 Notes”).

“Veeco has strengthened our balance sheet by proactively addressing our 2027 Notes following the settlement of our 2025 Notes at maturity in January,” said John Kiernan, Chief Financial Officer of Veeco. “These transactions provide greater financial flexibility, in addition to reducing our ongoing interest expense and outstanding debt.”

Prior to the Exchanges, the 2027 Notes had an aggregate principal amount of $25.0 million, representing approximately 1.8 million underlying shares of the Company’s common stock based on the conversion ratio of 71.5372 shares per $1,000 principal amount of the 2027 Notes. In accordance with the terms of the Exchanges, the Company exchanged the 2027 Notes for an aggregate of approximately 1.6 million newly issued shares of its common stock and approximately $5.4 million in cash, inclusive of accrued and unpaid interest.

The Exchanges were made pursuant to an exemption from registration provided in Section 4(a)(2) of the Securities Act of 1933, as amended.

ICR Capital LLC acted as the Company’s financial advisor.

About Veeco
Veeco (NASDAQ: VECO) is an innovative manufacturer of semiconductor process equipment. Our laser annealing, ion beam, single wafer etch & clean, lithography, and metal organic chemical vapor deposition (MOCVD) technologies play an integral role in the fabrication and packaging of advanced semiconductor devices. With equipment designed to optimize performance, yield and cost of ownership, Veeco holds leading technology positions in the markets we serve. To learn more about Veeco’s systems and service offerings, visit www.veeco.com.

To the extent that this news release discusses expectations or otherwise makes statements about the future, such statements are forward-looking and are subject to a number of risks and uncertainties that could cause actual results to differ materially from the statements made. These factors include the risks discussed in the Business Description and Management’s Discussion and Analysis sections of Veeco’s Annual Report on Form 10-K for the year ended December 31, 2024 and in our subsequent quarterly reports on Form 10-Q, current reports on Form 8-K and press releases. Veeco does not undertake any obligation to update any forward-looking statements to reflect future events or circumstances after the date of such statements.

Veeco Contacts:
Investors: Anthony Pappone | (516) 500-8798 | apappone@veeco.com
Media: Javier Banos | (516) 673-7328 | jbanos@veeco.com

The MIL Network –

May 16, 2025

MIL-OSI: XBP Europe Holdings, Inc. Reports First Quarter 2025 Results

Source: GlobeNewswire (MIL-OSI)

First Quarter 2025 Highlights

Revenue of $37.7 million, a decrease of 1.2% year-over-year and increase of 5.7% sequentially
Gross margin of 30.1%, a 380 bps increase year-over-year and 190 bps increase sequentially
Adjusted EBITDA of $3.7 million, an increase of 25.6% year-over-year and decrease of 16.1% sequentially

LONDON and Santa Monica, Calif., May 15, 2025 (GLOBE NEWSWIRE) — XBP Europe Holdings, Inc. (“XBP Europe” or “the Company”) (NASDAQ: XBP), a pan-European integrator of bills, payments, and related solutions and services seeking to enable the digital transformation of its clients, announced today its financial results for the quarter ended March 31, 2025.

“Our strong momentum continued into 2025, reflected by growing revenue, gross margin, and Adjusted EBITDA. We saw revenue growth for the third straight quarter, along with gross margin expansion on a year-over-year and sequential basis, driven by expanded use of AI technology and improved operational leverage,” said Andrej Jonovic, Chief Executive Officer of XBP Europe.

First Quarter Highlights

Revenue: Total Revenue was $37.7 million, a decrease of 1.2% year-over-year and an increase of 5.7% sequentially.
- Bills & Payments segment revenue was $26.3 million, a decline of 1.2% year-over-year and an increase of 1.8% sequentially.
- Technology segment revenue was $11.4 million, a decrease of 1.0% year-over-year and an increase of 16% sequentially.
Operating Loss: Operating Loss was $1.8 million compared to Operating Profit of $1.3 million a year ago and $1.0 million in the 4Q 2024. The decline was primarily driven by the recognition of $3.8 million of non-cash stock-based compensation due to accelerated vesting of RSUs and Options. When adjusted for this item, our Operating Profit was $2.0 million in the quarter, an improvement of $0.7 million year-over-year and $1.0 million sequentially, driven primarily by higher gross profit.

Net Loss: Net loss from continuing operations was $3.9 million. Adjusting for the previously mentioned non-cash stock-based compensation expense, our net loss from continuing operations was $0 million, compared with a net loss from continuing operations of $0.9 million a year ago and $0.2 million in the fourth quarter 2024.

Adjusted EBITDA⁽¹⁾: Adjusted EBITDA from Continuing Operations was $3.7 million, an increase of $0.8 million or 25.5% year-over-year. Adjusted EBITDA margin was 9.8%, an increase of 210 basis points year-over-year.

Adequate Liquidity: The Company’s cash and cash equivalents totaled $9.7 million as of March 31, 2025.

Pending Acquisition: As announced on March 4, 2025, XBP Europe has entered into an exclusive, non-binding letter of intent with Exela Technologies, Inc. to acquire Exela Technologies BPA, LLC (“BPA”), a leading provider of business process automation solutions. The closing of the acquisition will be subject to BPA completing a corporate reorganization which is expected to create a sustainable capital structure with a substantially deleveraged balance sheet. If completed, the acquisition will expand XBP Europe’s revenue to approximately $1 billion from $143 million on a pro forma basis for the year ending December 31, 2024. The parties have agreed to act in good faith to negotiate definitive agreements, complete due diligence, undertake necessary regulatory approvals, and seek any necessary approvals, including from XBP Europe’s shareholders. Accordingly, there can be no assurance that a definitive agreement will be entered into or that the proposed transaction will be consummated. Readers are cautioned that those portions of the LOI that describe the proposed transaction are non-binding. XBP Europe only intends to announce additional details regarding the proposed transaction if and when a definitive agreement is executed.

Below is the note referenced above:

(1) Adjusted EBITDA is a non-GAAP measure. A reconciliation of Adjusted EBITDA is attached to this release.

Supplemental Investor Presentation
An investor presentation relating to our first quarter 2025 performance is available at investors.xbpeurope.com. This information has also been furnished to the SEC in a current report on Form 8-K.

About Non-GAAP Financial Measures
This press release includes constant currency, EBITDA, and Adjusted EBITDA, each of which is a financial measure that is not prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). The Company believes these non-GAAP financial measures provide investors with useful insights into the Company’s financial performance, results of operations, and liquidity, helping them understand the Company’s business trends and compare its results.

The Company’s board of directors and management use these measures to evaluate the Company’s performance on a consistent basis across periods by excluding effects of the Company’s capital structure (such as varying debt levels, interest expense, and transaction costs from the November 2023 business combination). Adjusted EBITDA also seeks to remove the effects of integration and related restructuring expenses and other similar non-routine items, some of which are outside management’s control. Restructuring expenses are primarily related to the implementation of strategic actions and initiatives related to the rightsizing of the business. All of these costs are variable and dependent upon the nature of the actions being implemented and can vary significantly driven by business needs. Accordingly, due to that significant variability, we exclude these charges since we do not believe they truly reflect our past, current or future operating performance.

The constant currency presentation excludes the impact of fluctuations in foreign currency exchange rates. We calculate constant currency revenue and Adjusted EBITDA on a constant currency basis by converting our current-period local currency financial results using the exchange rates from the corresponding prior-period and compare these adjusted amounts to our corresponding prior period reported results.

The Company does not consider these non-GAAP measures in isolation or as an alternative to liquidity or financial measures determined in accordance with GAAP. A limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in the Company’s financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by management about which expenses and income are excluded or included in determining these non-GAAP financial measures and therefore the basis of presentation for these measures may not be comparable to similarly-titled measures used by other companies. These non-GAAP financial measures are not required to be uniformly applied, are not audited and should not be considered in isolation or as substitutes for results prepared in accordance with GAAP, and their presentation may not be comparable to similar measures used by other companies. Net loss is the GAAP measure most directly comparable to the non-GAAP measures presented here. For a reconciliation of the comparable GAAP measures to these non-GAAP financial measures, see the schedules attached to this release.

Forward-Looking Statements
Certain statements included in this press release are not historical facts but are forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Forward-looking statements generally are accompanied by words such as “may”, “should”, “would”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict”, “potential”, “seem”, “seek”, “continue”, “future”, “will”, “expect”, “outlook” or other similar words, phrases or expressions. These forward-looking statements include statements regarding future events, estimated or anticipated future results and benefits, future opportunities for XBP Europe Holdings, Inc. (together with its subsidiaries, the “Company”) and its industry, and other statements that are not historical facts. These statements reflect the current expectations of Company management and are not guarantees of actual performance. Actual results may differ materially due to a number of risks and uncertainties, including without limitation: (1) legal proceedings against the Company or others; (2) the Company’s inability to meet the continued listing standards of Nasdaq or another securities exchange; (3) disruptions from the proposed acquisition of Exela Technologies BPA, LLC (“BPA”) and related bankruptcy proceedings of BPA and certain of its subsidiaries’; (4) failure to realize benefits from the November 2023 business combination with CF Acquisition Corp. VIII; (5) acquisition-related costs; (6) changes in laws or regulations; (7) adverse effects from economic, business, or competitive factors; (8) market volatility due to geopolitical and economic factors; (9) challenges in achieving profitability, retaining clients, managing growth, or recruiting and retaining personnel; and (10) other risks and uncertainties set forth in the sections entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in the Annual Report on Form 10-K filed on March 19, 2025, as amended, and subsequent filings with the Securities and Exchange Commission (the “SEC”). In addition, forward-looking statements represent the Company’s expectations, plans or forecasts as of the date of this communication. Subsequent events may alter these assessments, and they should not be relied upon as representing the Company’s assessments as of any date subsequent to the date of this release.

About XBP Europe
XBP Europe is a pan-European integrator of bills, payments and related solutions and services seeking to enable digital transformation of its more than 2,000 clients. The Company’s name – ‘XBP’ stands for ‘exchange for bills and payments’ and reflects the Company’s strategy to connect buyers and suppliers, across industries, including banking, healthcare, insurance, utilities and the public sector, to optimize clients’ bills and payments and related digitization processes. The Company provides business process management solutions with proprietary software suites and deep domain expertise, serving as a technology and services partner for its clients. Its cloud-based structure enables it to deploy its solutions across the European market, along with the Middle East and Africa. The physical footprint of XBP Europe spans 15 countries and approximately 30 locations and a team of approximately 1,500 individuals. XBP Europe believes its business ultimately advances digital transformation, improves market wide liquidity by expediting payments, and encourages sustainable business practices. For more information, please visit: www.xbpeurope.com.

For more XBP Europe news, commentary, and industry perspectives, visit: https://www.xbpeurope.com/
And please follow us on social:
X: https://X.com/XBPEurope
Facebook: https://www.facebook.com/XBPEurope/
Instagram: https://www.instagram.com/xbp_europe/
LinkedIn: https://www.linkedin.com/company/xbp-europe/

The information posted on XBP Europe’s website and/or via its social media accounts may be deemed material to investors. Accordingly, investors, media and others interested in XBP Europe should monitor XBP Europe’s website and its social media accounts in addition to XBP Europe’s press releases, SEC filings and public conference calls and webcasts.

XBP Europe Holdings, Inc. Condensed Consolidated Balance Sheets As of March 31, 2025 and December 31, 2024 (in thousands of United States dollars except share and per share amounts) (Unaudited)

	March 31,		December 31,
	2025		2024
ASSETS
Current assets
Cash and cash equivalents	$	9,681	$	12,099
Accounts receivable, net of allowance for credit losses of $929 and $1,198, respectively		26,928		19,810
Inventories, net		3,650		3,823
Prepaid expenses and other current assets		5,756		4,228
Current assets held for sale		1,526		1,378
Total current assets		47,541		41,338
Property, plant and equipment, net of accumulated depreciation of $42,655 and $40,325, respectively		12,223		11,272
Operating lease right-of-use assets, net		4,861		4,805
Goodwill		22,656		21,666
Intangible assets, net		1,173		1,121
Deferred income tax assets		7,101		7,026
Long term notes receivable		2,280		—
Other noncurrent assets		1,142		817
Total assets	$	98,977	$	88,045

LIABILITIES AND STOCKHOLDERS’ DEFICIT
LIABILITIES
Current liabilities
Accounts payable	$	13,507	$	12,553
Related party payables		4,544		5,443
Accrued liabilities		25,015		17,993
Accrued compensation and benefits		17,951		16,482
Customer deposits		328		277
Deferred revenue		7,419		6,870
Current portion of finance lease liabilities		4		12
Current portion of operating lease liabilities		1,826		1,734
Current portion of long-term debts		5,443		4,958
Current liabilities held for sale		1,761		2,443
Total current liabilities		77,798		68,765
Related party notes payable		1,512		1,451
Long-term debt, net of current maturities		24,289		23,966
Pension liabilities		10,862		10,339
Operating lease liabilities, net of current portion		3,227		3,271
Other long-term liabilities		1,677		1,599
Total liabilities	$	119,365	$	109,391
Commitments and Contingencies (Note 13)

STOCKHOLDERS’ DEFICIT
Preferred stock, par value of $0.0001 per share; 10,000,000 shares authorized; none issued and outstanding as of March 31, 2025 and December 31, 2024, respectively		—		—
Common Stock, par value of $0.0001 per share; 200,000,000 shares authorized; 35,711,498 shares issued and outstanding as of March 31, 2025 and 30,166,102 shares issued and outstanding as of December 31, 2024, respectively		36		30
Additional paid in capital		7,494		1,611
Accumulated deficit		(28,055)		(23,705)
Accumulated other comprehensive loss:
Foreign currency translation adjustment		(102)		474
Unrealized pension actuarial gains, net of tax		239		244
Total accumulated other comprehensive loss		137		718
Total stockholders’ deficit		(20,388)		(21,346)
Total liabilities and stockholders’ deficit	$	98,977	$	88,045

XBP Europe Holdings, Inc. Condensed Consolidated Statements of Operations For the three months ended March 31, 2025 and 2024 (in thousands of United States dollars except share and per share amounts) (Unaudited)

	Three months ended March 31,
	2025		2024
Revenue, net	$	37,531	$	38,047
Related party revenue, net		142		66
Cost of revenue (exclusive of depreciation and amortization)		26,309		28,062
Related party cost of revenue		9		18
Selling, general and administrative expenses (exclusive of depreciation and amortization)		10,953		6,968
Related party expense		1,562		926
Depreciation and amortization		627		808
Operating profit (loss)	$	(1,787)		1,331
Other expense (income), net
Interest expense, net		1,721		1,417
Related party interest expense, net		23		19
Foreign exchange losses, net		(71)		753
Changes in fair value of warrant liability		2		(37)
Pension income, net		(369)		(423)
Net loss before income taxes	$	(3,093)		(398)
Income tax expense		762		460
Net loss from continuing operations	$	(3,855)		(858)
Net loss from discontinued operations, net of income taxes		(495)		(1,350)
Net loss	$	(4,350)	$	(2,208)
Loss per share:
Basic and diluted – continuing operations	$	(0.12)	$	(0.03)
Basic and diluted – discontinued operations		(0.02)		(0.04)
Basic and diluted	$	(0.14)	$	(0.07)

XBP Europe Holdings, Inc. Condensed Consolidated Statements of Cash Flows For the three months ended March 31, 2025 and 2024 (in thousands of United States dollars) (Unaudited)

	Three months ended March 31,
	2025		2024
Cash flows from operating activities
Net loss	$	(4,350)	$	(2,208)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		542		776
Amortization of intangible assets		117		181
Debt issuance cost amortization		105		—
Credit loss expense		(274)		217
Changes in fair value of warrant liability		2		(37)
Stock-based compensation expense		3,587		—
Unrealized foreign currency losses (gains)		(546)		759
Change in deferred income taxes		156		44

Change in operating assets and liabilities
Accounts receivable		(5,816)		(1,160)
Inventories		285		(102)
Prepaid expense and other assets		(1,547)		(1,342)
Accounts payable		377		1,463
Related party payables		(267)		(1,711)
Accrued expenses and other liabilities		6,151		(791)
Deferred revenue		288		492
Customer deposits		261		(191)
Net cash used in operating activities		(929)		(3,610)

Cash flows from investing activities
Purchase of property, plant and equipment		(968)		(385)
Additions to internally developed software		(123)		—
Net cash used in investing activities		(1,091)		(385)

Cash flows from financing activities
Borrowings under secured borrowing facility		—		37
Principal payments on 2024 Term Loan A Facility		(189)		—
Principal payments on 2024 Term Loan B Facility		(552)		—
Principal payments on long-term obligations		—		(235)
Proceeds from secured credit facility		1,655		976
Principal payments on secured credit facility		(1,356)
Principal payments on finance leases		(8)		(100)
Net cash provided by (used in) financing activities		(450)		678
Effect of exchange rates on cash and cash equivalents		90		(87)
Net increase (decrease) in cash and cash equivalents		(2,380)		(3,404)

Cash and equivalents, beginning of period, including cash from discontinued operations		12,106		6,905
Cash and equivalents, end of period, including cash from discontinued operations	$	9,726	$	3,501

Supplemental cash flow data:
Income tax payments, net of refunds received		271		(16)
Interest paid		928		534

XBP Europe Holdings, Inc. Schedule 1: Reconciliation of Adjusted EBITDA and constant currency revenues

Reconciliation of Non-GAAP Financial Measures to GAAP Measures

Non-GAAP constant currency revenue reconciliation
			Three Months ended March 31,
($ in thousands)			2025		2024
Revenues, as reported (GAAP)			37,673		38,113
Foreign currency exchange impact⁽¹⁾			766		–
Revenues, at constant currency (Non-GAAP)			38,438		38,113

Reconciliation of Adjusted EBITDA from Continuing Operations

	Three Months Ended March 31,
(dollars in thousands)		2025			2024
Net loss from continuing operations	$	(3,855)		$	(858)
Income tax expense		762			460
Interest expense including related party interest expense, net		1,744			1,436
Depreciation and amortization		627			807
EBITDA from continuing operations		(722)			1,846
Restructuring and related expenses⁽²⁾		667			332
Foreign exchange losses, net		(71)			752
Stock-based compensation expense⁽³⁾		3,818			—
Changes in fair value of warrant liability		2			(37)
Transaction Fees⁽⁴⁾		—			49
Adjusted EBITDA from continuing operations	$	3,694		$	2,942

(1)  Constant currency excludes the impact of foreign currency fluctuations and is computed by applying the average exchange rates for the quarter ended March 31, 2024, to the revenues during the corresponding period in 2025.
(2)  Adjustment represents costs associated with restructuring, including employee severance and vendor and lease termination costs.
(3)  Related to accelerated vesting of RSU and stock awards.
(4)  Represents transaction costs incurred as part of the Business Combination.

Reconciliation of Adjusted EBITDA from Discontinued Operations

	Three Months Ended March 31,
(dollars in thousands)	2025		2024
Net loss from discontinued operations, net of income taxes	$	(495)	$	(1,350)
Income tax expense		—		—
Interest expense, net		14		10
Depreciation and amortization		32		150
EBITDA from discontinued operations		(449)		(1,190)
Foreign exchange losses (gains), net		(359)		80
Adjusted EBITDA from discontinued operations	$	(808)	$	(1,110)

Source: XBP Europe Holdings, Inc.

The MIL Network –

May 16, 2025

MIL-OSI: South Bow Reports First-quarter 2025 Results and Declares Dividend

Source: GlobeNewswire (MIL-OSI)

CALGARY, Alberta, May 15, 2025 (GLOBE NEWSWIRE) — South Bow Corp. (TSX & NYSE: SOBO) (South Bow or the Company) reports its first-quarter 2025 financial and operational results and provides an update on its 2025 outlook. Unless otherwise noted, all financial figures in this news release are in U.S. dollars.

Highlights

Safety and operational performance

Recorded first-quarter 2025 throughput of approximately 613,000 barrels per day (bbl/d) on the Keystone Pipeline, with a System Operating Factor (SOF) of 98%, and approximately 726,000 bbl/d on the U.S. Gulf Coast segment of the Keystone Pipeline System.
Demonstrated strong project execution, completing construction of the Blackrod Connection Project’s 25-km crude oil and natural gas pipeline segments while achieving excellent safety performance. South Bow remains on schedule to complete the facility work and be ready for in-service in early 2026, with associated cash flows expected to increase through 2027.
Subsequent to period end, responded to an oil release at Milepost 171 (MP-171) of the Keystone Pipeline near Fort Ransom, N.D., on April 8, 2025. With approval from the Pipeline and Hazardous Materials Safety Administration (PHMSA), South Bow safely restarted the pipeline late on April 15, 2025 with certain operating pressure restrictions. See “Milepost 171 incident” of this news release.

Financial performance

Demonstrated financial resilience despite significant market volatility, owing to the Company’s highly contracted assets.
- Generated revenue of $498 million and net income of $88 million ($0.42/share).
- Recorded normalized earnings before interest, income taxes, depreciation, and amortization (normalized EBITDA)¹ of $266 million. Lower demand for uncommitted capacity on South Bow’s pipeline systems resulted in an 8% decrease in normalized EBITDA from the fourth quarter of 2024.
- Delivered distributable cash flow¹ of $151 million.
Maintained total long-term debt and net debt¹ outstanding of $5.7 billion and $4.9 billion, respectively, during the first quarter of 2025. The Company’s net debt-to-normalized EBITDA ratio¹ was 4.6 times as of March 31, 2025.

Returns to shareholders

Declared dividends totalling $104 million or $0.50/share to shareholders during the first quarter of 2025.
South Bow’s board of directors approved a quarterly dividend of $0.50/share, payable on July 15, 2025 to shareholders of record at the close of business on June 30, 2025. The dividends will be designated as eligible dividends for Canadian income tax purposes.

Spinoff activities

Implemented South Bow’s new enterprise resource planning system, marking a significant milestone in fully establishing South Bow as an independent company. Exiting the Transition Services Agreement (TSA) with TC Energy Corporation (TC Energy) continues progressing with plans to implement South Bow’s new supervisory control and data acquisition (SCADA) system in the second half of 2025.

South Bow’s unaudited consolidated interim financial statements and notes (the financial statements), and management’s discussion and analysis (MD&A) as at and for the three months ended March 31, 2025 are available on South Bow’s website at www.southbow.com, under South Bow’s SEDAR+ profile at www.sedarplus.ca, and in South Bow’s filings with the U.S. Securities and Exchange Commission (SEC) at www.sec.gov. The disclosure under the section “Non-GAAP Financial Measures” in South Bow’s MD&A as at and for the three months ended March 31, 2025 is incorporated by reference into this news release.

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¹ Non-GAAP financial measure or ratio that do not have standardized meanings under generally accepted accounting principles (GAAP) and may not be comparable to measures presented by other entities. See “Non-GAAP financial measures” of this news release.

Financial and operational results

$ millions, unless otherwise noted	Three Months Ended
$ millions, unless otherwise noted	Dec. 31, 2024	March 31, 2025	March 31, 2024
FINANCIAL RESULTS
Revenue	488	498	544
Income from equity investments	12	13	12
Net income	55	88	112
Per share ¹	0.26	0.42	0.54
Normalized net income ²	112	98	114
Per share ^{1 2}	0.54	0.47	0.55
Normalized EBITDA ²	290	266	298
Keystone Pipeline System	250	235	277
Marketing	24	16	9
Intra-Alberta & Other	16	15	12
Distributable cash flow ²	183	151	178
Dividends declared	104	104	—
Per share ¹	0.50	0.50	—
Capital expenditures ³	28	32	12
Total long-term debt ⁴	5,716	5,719	5,924
Net debt ^{2 5}	4,901	4,910	5,421
Net debt-to-normalized EBITDA (ratio) ^{2 6}	4.5	4.6	4.8
Common shares outstanding, weighted average diluted (millions) ⁷	208.4	208.7	207.6
Common shares outstanding (millions) ⁷	208.0	208.2	207.6

OPERATIONAL RESULTS
Keystone Pipeline SOF (%)	96	98	96
Keystone Pipeline throughput (Mbbl/d)	621	613	643
U.S. Gulf Coast segment of Keystone Pipeline System throughput (Mbbl/d) ⁸	784	726	779
Marketlink throughput (Mbbl/d)	615	549	582

Per share amounts, with the exception of dividends, are based on weighted average diluted common shares outstanding.
Non-GAAP financial measure or ratio that do not have standardized meanings and may not be comparable to measures presented by other entities. See “Non-GAAP financial measures” of this news release.
Capital expenditures per the investing activities of the consolidated statements of cash flows of the financial statements.
Total long-term debt at March 31, 2025 and December 31, 2024 includes the Company’s senior unsecured notes and junior subordinated notes. Total long-term debt at March 31, 2024 includes the Company’s long-term debt to affiliates of TC Energy.
Includes 50% equity treatment of South Bow’s junior subordinated notes.
South Bow expects that its net debt-to-normalized EBITDA ratio will increase modestly through the course of 2025 as the Company continues to invest in the Blackrod Connection Project and incur one-time costs of approximately $40 million to $50 million associated with the spinoff from TC Energy (the Spinoff). Consistent with the Company’s outlook on leverage, South Bow anticipates exiting 2025 with a net debt-to-normalized EBITDA ratio of approximately 4.8 times and that the Company will begin reducing its leverage once the Blackrod Connection Project starts generating cash flow in 2026.
The common shares issued on Oct. 1, 2024 have been used for comparative periods, as the Company had no common shares outstanding prior to the Spinoff. For periods prior to Oct. 1, 2024, it is assumed there were no dilutive equity instruments, as there were no equity awards of South Bow outstanding prior to the Spinoff.
Comprises throughput originating in Hardisty, Alta. transported on the Keystone Pipeline, and throughput originating in Cushing, Okla. transported on Marketlink for destination in the U.S. Gulf Coast.

Milepost 171 incident

On April 8, 2025, South Bow responded to an oil release at MP-171 of the Keystone Pipeline near Fort Ransom, N.D., activating emergency response protocols and working closely with regulators, local officials, landowners, and the surrounding community. After receiving approval from PHMSA, South Bow safely restarted the pipeline late on April 15, 2025.
PHMSA issued a Corrective Action Order (CAO) requiring South Bow to undertake corrective actions, including operating under pressure restrictions for specific segments of the pipeline. The CAO also requires a root cause failure analysis (RCFA) and metallurgical testing, which independent third parties are currently conducting. South Bow will share the findings of these investigations in the coming months.
South Bow is actively monitoring the performance of the Keystone Pipeline to ensure safe and reliable operations and anticipates meeting its contractual throughput commitments under the CAO.
South Bow has recovered substantially all released volumes and is progressing towards complete remediation of the site by mid-2025. Environmental remediation costs are largely expected to be recovered through the Company’s insurance policies.
South Bow demonstrated its ability to respond quickly and return its assets to service following the incident. A core South Bow value is ‘We Are Safe’ and incident prevention on the Company’s pipeline systems is paramount.
- The Company’s integrity program is extensive, continuously and proactively incorporates new learnings and technologies, and upholds a commitment to maintaining safe operations.
- Preliminary remedial actions in response to the MP-171 incident include completion of the RCFA by third-party experts and implementation of its recommendations. South Bow will also work with its suppliers and industry experts to determine the failure mechanism. The Company expects to complete a combination of in-line inspection runs and investigative excavations to further advance its asset integrity and reliability.

Outlook

Market outlook

Crude oil pipeline capacity in the Western Canadian Sedimentary Basin continues to exceed crude oil supply. As a result, the demand for uncommitted capacity on South Bow’s Keystone Pipeline is expected to remain low in the near term. Additionally, rapidly changing global trade policies, including tariffs, have introduced economic and geopolitical uncertainty, leading to significant volatility in commodity prices and pricing differentials.

2025 guidance

South Bow’s guidance aims to inform readers about Management’s expectations for 2025 financial and operational results. Readers are cautioned that these estimates may not be suitable for any other purpose. See “Forward-looking information and statements” of this news release for additional information regarding factors that could cause actual events to be significantly different from those expected.

South Bow’s 2025 annual guidance is outlined below:

$ millions, except percentages	2025 Original Guidance ^{1 2}	2025 Guidance ²	2025 YTD Actuals
Normalized EBITDA	1,010 +/- 3%	1,010 +1% / -2%	266
Interest expense	325 +/- 2%	325 +/- 2%	83
Effective tax rate (%)	23% – 24%	23% – 24%	23%
Distributable cash flow	535 +/- 3%	535 +/- 3%	151
Capital expenditures
Growth	110 +/- 3%	110 +/- 3%	48
Maintenance ³	65 +/- 3%	65 +/- 3%	13

See South Bow’s March 5, 2025 news release “South Bow Reports Fourth-quarter and Year-end 2024 Results, Provides 2025 Outlook, and Declares Dividend”, available on South Bow’s website at www.southbow.com, under South Bow’s SEDAR+ profile at www.sedarplus.ca, and in South Bow’s filings with the SEC at www.sec.gov.
Assumes average foreign exchange rate of C$/U.S.$1.4286.
Maintenance capital expenditures are generally recoverable through South Bow’s tolling arrangements.
- South Bow is reaffirming its outlook for normalized EBITDA of approximately $1.01 billion in 2025, underpinned by the Company’s highly contracted cash flows and structural demand for services, including solid financial performance in the first quarter of 2025. Approximately 90% of South Bow’s normalized EBITDA is secured through committed arrangements, which carry minimal commodity price or volumetric risk.
  - With market fundamentals and policy uncertainty expected to persist in the near term, and South Bow’s operational priorities in response to the MP-171 incident, the Company believes that any potential financial contributions from uncommitted capacity on the Keystone Pipeline will be limited in the near term. Accordingly, the Company is reducing the upper end of its normalized EBITDA guidance of $1.01 billion to 1%, and is increasing the lower end to -2% due to strong first-quarter 2025 performance.
  - The findings of the RCFA and South Bow’s next steps in response to the MP-171 incident may further impact the Company’s financial and operational outlook for 2025.
- Normalized EBITDA for the second quarter of 2025 is expected to be approximately 7% to 8% lower than first-quarter 2025 normalized EBITDA of $266 million, with a reduced outlook for South Bow’s Marketing segment as the Company realizes losses associated with certain positions that were unwound in early 2025 in the face of pricing volatility. Additional losses associated with these positions will be recognized in the third and fourth quarters of 2025.

Capital allocation priorities

South Bow takes a disciplined approach to capital allocation to preserve optionality and maximize total shareholder returns over the long term. The Company’s capital allocation priorities are built on a foundation of financial strength and supported by South Bow’s stable, predictable cash flows. South Bow’s capital allocation priorities include:
- paying a sustainable base dividend;
- strengthening the Company’s investment-grade financial position; and
- leveraging existing infrastructure within South Bow’s strategic corridor to offer customers competitive connections and enhanced optionality.

Conference call and webcast details

South Bow’s senior leadership will host a conference call and webcast to discuss the Company’s first-quarter 2025 results on May 16, 2025 at 8 a.m. MT (10 a.m. ET).

Register ahead of time to receive a unique PIN to access the conference call via telephone. Once registered, participants can dial into the conference call from their telephone via the unique PIN or click on the “Call Me” option to receive an automated call directly on their telephone.

Visit www.southbow.com/investors for the replay following the event.

Non-GAAP financial measures

In this news release, South Bow references certain non-GAAP financial measures and ratios that do not have standardized meanings under GAAP and may not be comparable to similar measures presented by other entities. These non-GAAP measures include or exclude adjustments to the composition of the most directly comparable GAAP measures. Management considers these non-GAAP financial measures and non-GAAP ratios to be important in evaluating and understanding the operational performance and liquidity of South Bow. These non-GAAP measures and non-GAAP ratios should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP.

South Bow’s non-GAAP financial measures and non-GAAP ratios include:

normalized EBITDA;
normalized net income;
normalized net income per share;
distributable cash flow;
net debt; and
net debt-to-normalized EBITDA ratio.

These measures and ratios are further described below, with a reconciliation to their most directly comparable GAAP measure.

Normalizing items

Normalized measures are, or include, non-GAAP financial measures and ratios and include normalized EBITDA, normalized net income, normalized net income per share, distributable cash flow, and net debt-to-normalized EBITDA ratio. Management uses these normalized measures to assess the financial performance of South Bow’s operations and compare period-over-period results. During certain reporting periods, the Company may incur costs that are not indicative of core operations or results. These normalized measures represent income (losses), adjusted for specific normalizing items that are believed to be significant; however, they are not reflective of South Bow’s underlying operations in the period.

These specific items include gains or losses on sales of assets or assets held for sale, unrealized fair value adjustments related to risk management activities, tariff charges, acquisition, integration, and restructuring costs, and other charges, including but not limited to, impairment, contractual costs, and settlements.

South Bow excludes the unrealized fair value adjustments related to risk management activities, as these represent the changes in the fair value of derivatives, but do not accurately reflect the gains and losses that will be realized at settlement and impact income. Therefore, South Bow does not consider them reflective of the Company’s underlying operations, despite providing effective economic hedges. Realized gains and losses on grade financial contracts are adjusted to improve comparability, as they settle in a subsequent period to the underlying transaction they are hedged against.

Separation costs relate to internal costs and external fees incurred specific to the Spinoff. These items have been excluded from normalized measures, as Management does not consider them reflective of ongoing operations and they are non-recurring in nature.

South Bow excludes tariff charges as they are not reflective of ongoing business conducted by the Company and are subject to uncertainty.

Normalized EBITDA

Normalized EBITDA is used as a measure of earnings from ongoing operations. Management uses this measure to monitor and evaluate the financial performance of the Company’s operations and to identify and evaluate trends. This measure is useful for investors as it allows for a more accurate comparison of financial performance of the Company across periods for ongoing operations. Normalized EBITDA represents income before income taxes, adjusted for the normalizing items, in addition to excluding charges for depreciation and amortization, interest expense, and interest income.

The following table reconciles income (loss) before income taxes to normalized EBITDA for the indicated periods:

$ millions	Three Months Ended
$ millions	Dec. 31, 2024		March 31, 2025		March 31, 2024
Income before income taxes	72		114		146
Adjusted for specific items:
Depreciation and amortization	62		62		61
Interest expense	84		83		94
Interest income and other	28		(6	)	(7	)
Risk management instruments	57		6		—
Keystone variable toll disputes	(3	)	—		—
Milepost 14 (MP-14) costs	4		—		—
Separation costs	(1	)	3		4
Tariff charges	—		1		—
Keystone XL costs and other	(13	)	3		—
Normalized EBITDA	290		266		298

The following table reconciles income (loss) before income taxes to normalized EBITDA by operating segment for the indicated periods:

$ millions	Three Months Ended Dec. 31, 2024
$ millions	Keystone Pipeline System		Marketing		Intra-Alberta & Other		Total
Income (loss) before income taxes	205		(32	)	(101	)	72
Adjusted for specific items:
Depreciation and amortization	59		—		3		62
Interest expense	(1	)	—		85		84
Interest income and other	(1	)	(1	)	30		28
Risk management instruments	—		57		—		57
Keystone variable toll disputes	(3	)	—		—		(3	)
MP-14 costs	4		—		—		4
Separation costs	—		—		(1	)	(1	)
Keystone XL costs and other	(13	)	—		—		(13	)
Normalized EBITDA	250		24		16		290

$ millions	Three Months Ended March 31, 2025
$ millions	Keystone Pipeline System		Marketing	Intra-Alberta & Other		Total
Income (loss) before income taxes	175		9	(70	)	114
Adjusted for specific items:
Depreciation and amortization	59		—	3		62
Interest expense	—		—	83		83
Interest income and other	(2	)	—	(4	)	(6	)
Risk management instruments	—		6	—		6
Separation costs	—		—	3		3
Tariff charges	—		1	—		1
Keystone XL costs and other	3		—	—		3
Normalized EBITDA	235		16	15		266

$ millions	Three Months Ended March 31, 2024
$ millions	Keystone Pipeline System		Marketing		Intra-Alberta & Other		Total
Income (loss) before income taxes	218		9		(81	)	146
Adjusted for specific items:
Depreciation and amortization	60		—		1		61
Interest expense	1		1		92		94
Interest income and other	(2	)	(1	)	(4	)	(7	)
Separation costs	—		—		4		4
Normalized EBITDA	277		9		12		298

Normalized net income and normalized net income per share

Normalized net income represents net income adjusted for the normalizing items described above and is used by Management to assess the earnings that are representative of South Bow’s operations. By adjusting for non-recurring items and other factors that do not reflect the Company’s ongoing performance, normalized net income provides a clearer picture of the Company’s continuing operations. This measure is particularly useful for investors as it allows for a more accurate comparison of financial performance and trends across different periods. On a per share basis, normalized net income is derived by dividing the normalized net income by the weighted average common shares outstanding at the end of the period. Management believes this per share measure is valuable for investors as it provides insight into South Bow’s profitability on a per share basis, assisting in evaluating the Company’s performance.

The following table reconciles net income to normalized net income for the indicated periods:

$ millions, except common shares outstanding and per share amounts	Three Months Ended
	Dec. 31, 2024		March 31, 2025		March 31, 2024
Net income	55		88		112
Adjusted for specific items:
Risk management instruments	57		6		—
Keystone variable toll disputes	(3	)	—		—
MP-14 costs	4		—		—
Separation costs	27		3		4
Tariff charges	—		1		—
Keystone XL costs and other	(13	)	3		—
Tax effect of the above adjustments	(15	)	(3	)	(2	)
Normalized net income	112		98		114
Common shares outstanding, weighted average diluted (millions)	208.4		208.7		207.6
Normalized net income per share	0.54		0.47		0.55

Distributable cash flow

Distributable cash flow is used to assess the cash generated through business operations that can be used for South Bow’s capital allocation decisions, helping investors understand the Company’s cash-generating capabilities and its potential for returning value to shareholders. Distributable cash flow is based on income before income taxes, adjusted for depreciation and amortization, interest income and other, the normalizing items discussed above, and further adjusted for specific items, including income and distributions from the Company’s equity investments, maintenance capital expenditures, which are capitalized and generally recoverable through South Bow’s tolling arrangements, and current income taxes.

The following table reconciles income before income taxes to distributable cash flow for the indicated periods:

$ millions	Three Months Ended
$ millions	Dec. 31, 2024		March 31, 2025		March 31, 2024
Income before income taxes	72		114		146
Adjusted for specific items:
Depreciation and amortization	62		62		61
Interest income and other	28		(6	)	(7	)
Normalizing items, net of tax ¹	34		10		3
Income from equity investments	(12	)	(13	)	(12	)
Distributions from equity investments	20		19		20
Maintenance capital expenditures ²	(15	)	(13	)	(4	)
Current income tax recovery (expense)	(6	)	(22	)	(29	)
Distributable cash flow	183		151		178

Normalizing items per normalized EBITDA reconciliation, net of tax.
Maintenance capital expenditures are generally recoverable through South Bow’s tolling arrangements.

Net debt and net debt-to-normalized EBITDA ratio

Net debt is used as a key leverage measure to assess and monitor South Bow’s financing structure, providing an overview of the Company’s long-term debt obligations, net of cash and cash equivalents. Management believes this measure is useful for investors as it offers insights into the Company’s financial health and its ability to manage and service its debt obligations. Net debt is defined as the sum of total long-term debt with 50% treatment of the Company’s junior subordinated notes, operating lease liabilities, and dividends payable, less cash and cash equivalents, per the Company’s consolidated balance sheets.

Net debt-to-normalized EBITDA ratio is used to monitor South Bow’s leverage position relative to its normalized EBITDA for the trailing four quarters. This ratio provides investors with insight into the Company’s ability to service its long-term debt obligations relative to its operational performance. A lower ratio indicates stronger financial health and greater capacity to meet its debt obligations.

$ millions, except ratios	Dec. 31, 2024		March 31, 2025		March 31, 2024
Long-term debt to affiliates of TC Energy	—		—		5,924
Senior unsecured notes	4,629		4,632		—
Junior subordinated notes	1,087		1,087		—
Total long-term debt	5,716		5,719		5,924
Adjusted for:
Hybrid treatment for junior subordinated notes ¹	(544	)	(544	)	—
Operating lease liabilities	22		21		19
Dividends payable	104		104		—
Cash and cash equivalents	(397	)	(390	)	(522	)
Net debt	4,901		4,910		5,421

Normalized EBITDA for the trailing four quarters	1,091		1,059		1,136
Net debt-to-normalized EBITDA (ratio)	4.5		4.6		4.8

Includes 50% equity treatment of South Bow’s junior subordinated notes.

Forward-looking information and statements

This news release contains certain forward-looking statements and forward-looking information (collectively, forward-looking statements), including forward-looking statements within the meaning of the “safe harbor” provisions of applicable securities legislation, that are based on South Bow’s current expectations, estimates, projections, and assumptions in light of its experience and its perception of historical trends. All statements other than statements of historical facts may constitute forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as, “anticipate”, “will”, “expect”, “estimate”, “potential”, “future”, “outlook”, “strategy”, “maintain”, “ongoing”, “intend”, and similar expressions suggesting future events or future performance.

In particular, this news release contains forward-looking statements, including certain financial outlooks, pertaining to, without limitation, the following: South Bow’s corporate vision and strategy, including its strategic priorities, its satisfaction thereof, and outlook; the Blackrod Connection Project, including in-service dates, and costs thereof; PHMSA approvals and completion of the CAO; expected interest expense and tax rate; expected capital expenditures; expected dividends; expected one-time costs relating to the Spinoff; expected shareholder returns and asset returns; demand for uncommitted capacity on the Keystone System; treatment under current and future regulatory regimes, including those relating to taxes, tariffs, and the environment; South Bow’s financial guidance for 2025 and beyond, including 2025 normalized EBITDA, 2025 interest expense, 2025 distributable cash flow, and 2025 capital expenditures; South Bow’s financial strength and flexibility; expected exit of the TSA and implementation of the SCADA system; expected receipt and sharing of investigative, root cause, and failure mechanism findings related to the MP-171 incident; expected ability to meet contractual throughput commitments on the Keystone Pipeline under the CAO; expectation that South Bow will ensure safe and reliable operations on the Keystone Pipeline; expected timing for the remediation of the MP-171 incident; potential financial contributions from uncommitted capacity on the Keystone Pipeline System; and impacts of the findings of the RCFA and response to the MP-171 incident on the financial and operational outlook.

The forward-looking statements are based on certain assumptions that South Bow has made in respect thereof as of the date of this news release regarding, among other things: oil and gas industry development activity levels and the geographic region of such activity; that favourable market conditions exist and that South Bow has and will have available capital to fund its capital expenditures and other planned spending; prevailing commodity prices, interest rates, inflation levels, carbon prices, tax rates, and exchange rates; the ability of South Bow to maintain current credit ratings; the availability of capital to fund future capital requirements; future operating costs; asset integrity costs; that all required regulatory and environmental approvals can be obtained on the necessary terms in a timely manner; and prevailing regulatory, tax, and environmental laws and regulations.

Although South Bow believes the assumptions and other factors reflected in these forward-looking statements are reasonable as of the date hereof, there can be no assurance that these assumptions and factors will prove to be correct and, as such, forward-looking statements are not guarantees of future performance. Forward-looking statements are subject to a number of known and unknown risks and uncertainties that could cause actual events or results to differ materially, including, but not limited to: the regulatory environment and related decisions and requirements; the impact of competitive entities and pricing; reliance on third parties to successfully operate and maintain certain assets; the strength and operations of the energy industry; weakness or volatility in commodity prices; non-performance or default by counterparties; actions taken by governmental or regulatory authorities; the ability of South Bow to acquire or develop and maintain necessary infrastructure; fluctuations in operating results; adverse general economic and market conditions; the ability to access various sources of debt and equity capital on acceptable terms; and adverse changes in credit. The foregoing list of assumptions and risk factors should not be construed as exhaustive. For additional information on the assumptions made, and the risks and uncertainties which could cause actual results to differ from the results implied by forward-looking statements, refer to South Bow’s annual information form dated March 5, 2025, available under South Bow’s SEDAR+ profile at www.sedarplus.ca and, from time to time, in South Bow’s public disclosure documents, available on South Bow’s website at www.southbow.com, under South Bow’s SEDAR+ profile at www.sedarplus.ca, and in South Bow’s filings with the SEC at www.sec.gov.

Management approved the financial outlooks contained in this news release, including 2025 normalized EBITDA, 2025 interest expense, 2025 distributable cash flow, and 2025 capital expenditures as of the date of this news release. The purpose of these financial outlooks is to inform readers about Management’s expectations for the Company’s financial and operational results in 2025, and such information may not be appropriate for other purposes.

The forward-looking statements contained in this news release speak only as of the date hereof. South Bow does not undertake any obligation to publicly update or revise any forward-looking statements or information contained herein, except as required by applicable laws. All forward-looking statements contained in this news release are expressly qualified by this cautionary statement.

About South Bow

South Bow safely operates 4,900 kilometres (3,045 miles) of crude oil pipeline infrastructure, connecting Alberta crude oil supplies to U.S. refining markets in Illinois, Oklahoma, and the U.S. Gulf Coast through our unrivalled market position. We take pride in what we do – providing safe and reliable transportation of crude oil to North America’s highest demand markets. Based in Calgary, Alberta, South Bow is the spinoff company of TC Energy, with Oct. 1, 2024 marking South Bow’s first day as a standalone entity. To learn more, visit www.southbow.com.

Contact information

Investor Relations

Martha Wilmot
investor.relations@southbow.com

Media Relations

Solomiya Lyaskovska
communications@southbow.com

The MIL Network –

May 16, 2025

MIL-OSI Security: Two Men Sentenced for Real Estate and Tax Fraud

Source: United States Attorneys General 1

Two men were sentenced to prison today for a wire and tax fraud scheme to obtain title to a $1.3 million home in Roanoke County, Virginia. Herman Estes Jr. of Fieldale Virginia was sentenced to 84 months in prison; his co-conspirator Daniel Heggins of Charlotte, North Carolina was sentenced to 24 months in prison.

The following is according to court documents and statements made in court: Herman Estes filed a false amended income tax return for 2021 claiming he was entitled to a refund of $18.3 million. In March 2023, Estes made a $1.3 million cash offer for a property on Old Mill Plantation Road in Roanoke County. To legitimize this offer, Estes provided the parties to the transaction with a proof of funds letter that Estes created using an online form. Estes also provided the real estate agent with Heggins’ contact information and claimed Heggins was his trust manager with authority to approve the cash offer. When the real estate agent contacted Heggins, Heggins purported to approve Estes’s use of his trust funds to purchase the house.

As payment for the property, Estes tendered a fraudulent cashier’s check in the amount of $1,307,199.43 signed by him and purportedly drawn off a Federal Reserve Bank. Funds in that amount were debited to the settlement company’s trust account before the check was flagged as fraudulent.

In March 2023, Estes filed another false tax return claiming he was entitled to a $2.9 million refund.

In addition to the terms of imprisonment, Chief U.S. District Judge Elizabeth K. Dillon for the Western District of Virginia ordered Estes to serve three years of supervised release and Heggins to serve three years of supervised release.

Acting Deputy Assistant Attorney General Karen E. Kelly of the Justice Department’s Tax Division and Acting U.S. Attorney Zachary T. Lee for the Western District of Virginia made the announcement.

The Bureau of Alcohol, Tobacco, Firearms and Explosives and IRS Criminal Investigation investigated the case.

Trial Attorney Andrew Ascencio of the Tax Division and Assistant U.S. Attorney Lee Brett for the Western District of Virginia prosecuted the case. Former Assistant U.S. Attorney Kristin Johnson for the Western District of Virginia assisted in the investigation and prosecution.

MIL Security OSI –

May 16, 2025

MIL-OSI: Beam Global Announces First Quarter 2025 Operating Results

Source: GlobeNewswire (MIL-OSI)

SAN DIEGO, May 15, 2025 (GLOBE NEWSWIRE) — Beam Global, (Nasdaq: BEEM), (the “Company”), a leading provider of innovative and sustainable infrastructure solutions for the electrification of transportation and energy security, today announced its first quarter results for the period ended March 31, 2025.

Q1 2025 Financial Highlights

Revenue CAGR 60% for trailing 60 months
Commercial Revenues increased 41% over Q1 2024
Positive GAAP Gross Margin 8%
Adjusted non-GAAP Gross Margin, net of non-cash costs 21%
Net cash used in Operations for Q1 2025 $1.8 million vs. Q1 2024 $3.0 million
Backlog of $6.3 million
Debt free and $100 million line of credit available and unused

Q1 2025 and Recent Operational Highlights

In Q1 2025 we shipped EV ARC™ units, ARC Mobility™ trailers, energy storage systems (ESS), lighting poles and smart city infrastructure solutions to locations across California, Arizona, Colorado, Florida, Michigan, Oregon, and internationally to Croatia, Serbia, Spain and Romania
Achieved CE (Conformité Européenne) certification on EV ARC™
Granted U.S. Patent for High-Volume Battery Assembly and Safety Technology
Expanded our European sales network with three new distribution partners
- Seltis Glass Design S.R.L. for the Romanian market
- Evrosimovski Consulting Ltd. for the North Macedonian market
- BBA International for the Albanian market
Entered Middle Eastern market through partnership with Solvana
Launched BeamPatrol™ partnership with Zero Motorcycles with two BeamPatrol™ units at MotoGP in Austin to charge electric motorcycle demonstrations
Expanded into Romania with First EV ARC™ Sales through our Romanian reselling agent, Seltis Glass Design SRL
Won the Award for Innovation in Sustainable Infrastructure at the 2025 Congress of Mayors and Local Administration of Romania
Won the 2024 Award for Business Success by Serbian Chamber of Commerce

“Though we are navigating through a series of uncertainties in the U.S. market, our other expansion efforts lead us to believe that we have the pieces in place to return to growth in this and future quarters,” said Desmond Wheatley, CEO of Beam Global. “Sales of our flagship product EV ARC™ increased in the first quarter. Our battery business is doing some of the most interesting and promising work it has ever done. Our international expansion strategy is gaining momentum and bearing fruit. We have sufficient cash and working capital to continue to operate the business into the future. We have no debt and no going concern. We’re generating gross profits which, net of non-cash items, are still north of 20%. We have proposals out and items in our pipeline, which would simply not have been possible this time last year before we introduced our fantastic new product lineup and expanded beyond the US market. Losing the immediate benefits of U.S. federal government sales has been tough on us, but we are managing through that and have created a foundation for growth which is resistant to those sorts of upheavals, and which I believe, will create opportunities for growth which far out strip anything that we’ve ever done before.”

Revenues
For the first quarter of 2025, Beam Global’s revenues were $6.3 million. The Company has a Revenue CAGR of 60% for the trailing 60 months, as of the three months ending March 31, 2025. Revenues were diverse across commercial entities and state and local governments with a significant rebalancing towards enterprise customers. For the first quarter of 2025, 53% of revenues were derived from commercial customers compared to 16% in the same period in 2024. International customers comprised 25% of all revenue as of March 31, 2025 compared to 11% for the three months ended March 31, 2024. We believe that the decrease in revenue is mainly a result of uncertainty in the U.S. government’s zero emission vehicle strategy related to the presidential election.

Gross Profit

Gross profit for the quarter ended March 31, 2025, was $0.5 million, or 8% gross margin, compared to gross profit of $1.5 million, or 10% gross margin in the first quarter of the prior year. The gross profit includes a non-cash negative impact of $1.0 million for depreciation and amortization of intangible assets resulting from the AllCell acquisition. Our gross margin, net of non-cash items, was 21% for the quarter ended March 31, 2025 compared to 12% for the quarter ended March 31, 2024. Our engineering team has continued to implement design changes which have reduced the bill of materials for the EV ARC^TM, improving the product margins throughout 2024 and leading into 2025. Additionally, we have continued to recognize synergies and positive gross margin contributions from our acquisitions. We expect the Company’s revenue to grow in the future and our fixed overhead absorption to continue to improve resulting in improved gross margins.

Operating Expenses and Impairment of Goodwill

The first quarter 2025 total operating expenses of $16.0 million included $10.8 million of goodwill impairment, for the single reporting unit, because our market capitalization no longer exceeded our net assets at March 31, 2025 due to the decrease in our stock price since December 31, 2024. Our operating expenses, net of non-cash items for the three months ended March 31, 2025 are $4.1 million compared to 2024 of $3.8 million, a variance of $0.2 million or 6%. The Company believes the goodwill impairment reported during the three months ended March 31, 2025 is not a negative indicator of historic or current operating results and not a negative indicator of future performance as the Company has taken significant steps to diversify its geographical reach and product offerings while focusing on strategic growth. The Company believes that the resulting non-cash charge has no impact on the Company’s compliance with its cash flows or available liquidity and that its acquired entities are contributing positively to its operations and growth potential.

Net Loss

The first quarter net loss of $15.5 million included $12.5 million of non-cash expense items such as goodwill impairment, depreciation and amortization, stock-based compensation and provisions for credit losses in 2025, compared to a net loss of $3.0 million with non-cash expenses of $1.1 million in 2024. The first quarter 2025 net loss excluding non-cash items was $2.8 million compared to $2.1 million for the same period in 2024.

Cash

On March 31, 2025, we had cash of $2.5 million, compared to cash of $4.6 million at December 31, 2024.

Net cash used for operating activities was $1.8 million for the three months ended March 31, 2025 compared to $3.0 million for the same period in 2024.

We have historically met our cash needs through a combination of debt and equity financing and more recently through increasing gross profit contributions. Our cash requirements are generally for operating activities and acquisitions.

Non-GAAP Financial Measures

To supplement our condensed consolidated financial statements, which are prepared in accordance with GAAP, we present Non-GAAP financial measures, in this press release. We use Non-GAAP in conjunction with GAAP measures as part of our overall assessment of our performance to evaluate the effectiveness of our business strategies and to communicate with our board of directors concerning our financial performance. We believe Non-GAAP is also helpful to investors, analysts and other interested parties because it can assist in providing a more consistent and comparable overview of our operations across our historical financial periods. Non-GAAP has limitations as an analytical tool. Therefore, you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP. Because of these limitations, you should consider Non-GAAP measurements alongside other financial performance measures, including attributable to other GAAP measures. In evaluating Non-GAAP measures you should be aware that in the future, we may incur expenses that are the same as, or similar to, some of the adjustments reflected in this press release. Our presentation of Non-GAAP should not be construed to imply that our future results will be unaffected by the types of items excluded from the calculations of Non-GAAP measures. Non-GAAP is not presented in accordance with GAAP and the use of these terms vary from others in our industry.

Conference Call May 15, 2025 at 4:30 p.m. ET

Management will host a conference call on Thursday May 15, 2025 at 4:30 p.m. ET to review financial results and provide an update on corporate developments. Following management’s formal remarks, there will be a question-and-answer session.

Participants can register for the conference through the following link: https://dpregister.com/sreg/10200046/ff2f9aecc8

Please note that registered participants will receive their call-in number upon registration.

Those without internet access or unable to pre-register may call in by calling:

PARTICIPANT CALL IN (TOLL FREE): 1-844-739-3880

PARTICIPANT INTERNATIONAL CALL IN: 1-412-317-5716

Please ask to join the Beam Global call.

About Beam Global
Beam Global is a clean technology innovator which develops and manufactures sustainable infrastructure products and technologies. We operate at the nexus of clean energy and transportation with a focus on sustainable energy infrastructure, rapidly deployed and scalable EV charging solutions, safe energy storage and vital energy security. With operations in the U.S. and Europe, Beam Global develops, patents, designs, engineers and manufactures unique and advanced clean technology solutions that power transportation, provide secure sources of electricity, save time and money and protect the environment. Beam Global is headquartered in San Diego, CA with facilities in Broadview, IL and Belgrade and Kraljevo, Serbia. Beam Global is listed on Nasdaq under the symbol BEEM. For more information visit BeamForAll.com, LinkedIn, YouTube, Instagram and X (formerly Twitter).

Forward-Looking Statements
This Beam Global Press Release may contain forward-looking statements. All statements in this Press Release other than statements of historical facts are forward-looking statements. Forward-looking statements are generally accompanied by terms or phrases such as “estimate,” “project,” “predict,” “believe,” “expect,” “anticipate,” “target,” “plan,” “intend,” “seek,” “goal,” “will,” “should,” “may,” or other words and similar expressions that convey the uncertainty of future events or results. These statements relate to future events or future results of operations. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, which may cause Beam Global’s actual results to be materially different from these forward-looking statements. Except to the extent required by law, Beam Global expressly disclaims any obligation to update any forward-looking statements.

Investor Relations
Luke Higgins
+1-858-799-4583
IR@BeamForAll.com

Media Contact
Andy Lovsted
+1-858-335-8465
Press@BeamForAll.com


Beam Global
Condensed Consolidated Balance Sheets
(In thousands, except share and per share data)

	Three Months Ended
	March 31,		December 31,
	2025		2024
	(Unaudited)
Assets
Current assets
Cash	$	2,504	$	4,572
Accounts receivable, net of allowance for credit losses of $498 and $259	7,145		8,027
Prepaid expenses and other current assets	2,150		2,243
Inventory, net	11,845		12,284
Total current assets	23,644		27,126

Property and equipment, net	13,531		13,704
Operating lease right of use assets	1,650		1,893
Goodwill	–		10,580
Intangible assets, net	7,810		8,037
Deposits	120		119
Total assets	$	46,755	$	61,459

Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	8,316	$	8,959
Accrued expenses	2,393		2,462
Sales tax payable	435		195
Deferred revenue, current	1,042		847
Note payable, current	64		63
Contingent consideration, current	93		93
Operating lease liabilities, current	539		696
Total current liabilities	12,882		13,315

Deferred revenue, noncurrent	857		800
Note payable, noncurrent	182		199
Contingent consideration, noncurrent	216		216
Other liabilities, noncurrent	3,432		3,380
Deferred tax liabilities, noncurrent	1,609		1,290
Operating lease liabilities, noncurrent	905		971
Total liabilities	20,083		20,171

Commitments and contingencies (Note 10)

Stockholders’ equity
Preferred stock, $0.001 par value, 10,000,000 authorized, none outstanding as of March 31, 2025 and December 31, 2024.	–		–
Common stock, $0.001 par value, 350,000,000 shares authorized, 15,043,045 and 14,835,630 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively.	15		15
Additional paid-in-capital	147,518		147,072
Accumulated deficit	(120,166)		(104,643)
Accumulated Other Comprehensive Income (AOCI)	(695)		(1,156)

Total stockholders’ equity	26,672		41,288

Total liabilities and stockholders’ equity	$	46,755	$	61,459

Beam Global
Condensed Consolidated Statements of Operations and Comprehensive Loss
(Unaudited, In thousands except per share data)

	Three Months Ended
	March 31,
	2025		2024

Revenues	$	6,324	$	14,561

Cost of revenues	5,823		13,082

Gross profit	501		1,479


Operating expenses	5,265		4,527

Impairment of goodwill	10,780		–

Loss from operations	(15,544)		(3,048)

Other income (expense)
Interest income	23		71
Other income (expense)	4		(56)
Interest expense	(6)		(4)
Other income	21		11

Loss before income tax expense	(15,523)		(3,037)

Net Loss	$	(15,523)	$	(3,037)

Net foreign currency translation benefit (expense)	461		(329)
Total Comprehensive Loss	$	(15,062)	$	(3,366)

Net Loss per share – basic/diluted	$	(1.04)	$	(0.21)

Weighted average shares outstanding – basic/diluted	14,990		14,422

The MIL Network –

May 16, 2025

MIL-OSI: CORRECTING AND REPLACING – Katapult Delivers 15.4% Gross Originations and 10.6% Revenue Growth in the First Quarter, Above Outlook

Source: GlobeNewswire (MIL-OSI)

Expects Growth to Accelerate In Second Quarter
Reiterates 2025 Guidance

PLANO, Texas, May 15, 2025 (GLOBE NEWSWIRE) — In the press release issued by Katapult Holdings, Inc. on May 15, 2025, in the gross originations by quarter table, Q4 in FY 2024 should be $75.2 million instead of $64.2 million.

The updated release reads:

Katapult Holdings, Inc. (“Katapult” or the “Company”) (NASDAQ: KPLT), an e-commerce-focused financial technology company, today reported its financial results for the first quarter ended March 31, 2025.

“2025 is off to a strong start and we are well positioned to achieve our full year targets,” said Orlando Zayas, CEO of Katapult. “We achieved double-digit gross originations and revenue growth, driven by increasing engagement with the Katapult app marketplace, including 57% growth in KPay originations. Our marketplace is thriving – from application growth to repeat purchase rates, to high Net Promoter scores and beyond, we believe we have all the hallmarks of a healthy ecosystem and we intend to lean into opportunities to accelerate our growth. We are excited about the future and as we continue to execute on our consumer and merchant initiatives, we feel confident that we can create value for all of our stakeholders.”

Operating Progress: Recent Highlights

Increased activity within the Katapult app marketplace
- ~59% of first quarter gross originations started in the Katapult app marketplace, making it the single largest customer referral source. Total app originations grew 42% year-over-year.
- Applications grew ~59% year-over-year in the first quarter
- Customer satisfaction remained high and Katapult had a Net Promoter Score of 66 as of March 31, 2025
- 57.4% of gross originations for the first quarter of 2025 came from repeat customers¹
Grew consumer engagement by adding app functionality and features and executing targeted marketing campaigns
- KPay conversion rate increased during the first quarter leading to unique customer count growth of more than 65% year-over-year
- KPay gross originations grew approximately 57% year-over-year in the first quarter; 35% of total gross originations were transacted using KPay
- Launched Ashley and Bed Bath & Beyond in the Katapult app marketplace, bringing the total number of merchants in our KPay ecosystem to 35
Made strong progress against merchant engagement initiatives
- Direct and waterfall gross originations, which represented 65% of total first quarter originations, grew approximately 40%, excluding the home furnishings and mattress category
- Continued to expand our waterfall partnerships by kicking off a new partnership with Finti, a modern waterfall financing platform that connects consumers with a curated network of lenders and financing providers
- Together with several merchant-partners, we launched targeted co-branded, co-promoted marketing campaigns that delivered year-over-year gross originations growth ranging from 7% to more than 75% depending on the campaign

First Quarter 2025 Financial Highlights

(All comparisons are year-over-year unless stated otherwise.)

Gross originations were $64.2 million, an increase of 15.4%. Excluding the home furnishings and mattress category, gross originations grew 51% year-over-year.
Total revenue was $71.9 million, an increase of 10.6%
Total operating expenses in the first quarter increased 17.3%. Our fixed cash operating expenses², which exclude litigation settlement and other non-cash and variable expenses, increased approximately 10.8%.
Net loss was $5.7 million for the first quarter of 2025 compared with net loss of $0.6 million reported for the first quarter of 2024. The higher net loss was mainly due to higher cost of sales and higher operating expenses.
Adjusted net loss² was $3.4 million for the first quarter of 2025 compared to adjusted net income of $1.0 million reported for the first quarter of 2024
Adjusted EBITDA² was $2.2 million for the first quarter of 2025 compared to Adjusted EBITDA² of $5.6 million in the first quarter of 2024. The year-over-year performance was impacted by higher cost of sales related to rapid, faster-than-expected gross originations growth during the first quarter of 2025 and the end of the fourth quarter of 2024.
Katapult ended the quarter with total cash and cash equivalents of $14.3 million, which includes $8.3 million of restricted cash. The Company ended the quarter with $77.8 million of outstanding debt on its credit facility.
Write-offs as a percentage of revenue were 9.0% in the first quarter of 2025 and are within the Company’s 8% to 10% long-term target range. This compares with 8.4% in the first quarter of 2024.

[1] Repeat customer rate is defined as the percentage of in-quarter originations from existing customers.
[2] Please refer to the “Reconciliation of Non-GAAP Measure and Certain Other Data” section and the GAAP to non-GAAP reconciliation tables below for more information.

Second Quarter and Full Year 2025 Business Outlook

The Company is continuing to navigate a challenging macro environment particularly within the home furnishings category. Given the current breadth of our merchant selection as well as our plans to introduce new merchants to the Katapult App Marketplace during 2025, our strategic marketing and our strong consumer offering, we believe we are well positioned to deliver continued growth in 2025. We continue to believe that we have a large addressable market of underserved, non-prime consumers, and it’s important to note that lease-to-own solutions have historically benefited when prime credit options become less available.

Given our quarter-to-date progress, Katapult expects the following results for the second quarter of 2025:

25% to 30% year-over-year increase in gross originations
17% to 20% year-over-year increase in revenue
Approximately breakeven Adjusted EBITDA

Based on the macroeconomic assumptions above and the operating plan in place for the full year 2025, Katapult is reiterating its expectations for full year 2025:

We expect gross originations to grow at least 20%

This outlook does not include any material impact from prime creditors tightening or loosening above us and assumes that there are no significant changes to the macro environment.

Both our second quarter and full year outlooks assume that the gross originations for the home furnishings and mattress category do not improve materially from our 2024 performance.

We also expect to maintain strong credit quality in our portfolio. This will be driven by ongoing enhancements to our risk modeling, onboarding high quality new merchants through integrations, and repeat customers engaging with Katapult Pay

Revenue growth is expected to be at least 20%

Finally, with the continued execution of our disciplined expense management strategy combined with our growing top-line, we expect to deliver at least $10 million in positive Adjusted EBITDA

“The first quarter came in stronger than our outlook, and we are continuing to successfully grow our top-line without meaningfully increasing our expense base,” said Nancy Walsh, CFO of Katapult. “The second quarter is off to a great start and we believe we can continue to scale our business by offering a transparent and fair LTO product to consumers and a growth engine to our partners. Our team’s hard work and agile execution is fueling our growth and we are looking forward to a great 2025.”

Conference Call and Webcast

The Company will host a conference call and webcast at 8:00 AM ET on Thursday, May 15, 2025, to discuss the Company’s financial results. Related presentation materials will be available before the call on the Company’s Investor Relations page at https://ir.katapultholdings.com. The conference call will be broadcast live in listen-only mode and an archive of the webcast will be available for one year.

About Katapult

Katapult is a technology driven lease-to-own platform that integrates with omnichannel retailers and e-commerce platforms to power the purchasing of everyday durable goods for underserved U.S. non-prime consumers. Through our point-of-sale (POS) integrations and innovative mobile app featuring Katapult Pay(R), consumers who may be unable to access traditional financing can shop a growing network of merchant partners. Our process is simple, fast, and transparent. We believe that seeing the good in people is good for business, humanizing the way underserved consumers get the things they need with payment solutions based on fairness and dignity.

Contact

Jennifer Kull
VP of Investor Relations
ir@katapult.com

Forward-Looking Statements

Certain statements included in this Press Release and on our quarterly earnings call that are not historical facts are forward-looking statements for purposes of the safe harbor provisions under the United States Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements may be identified by words such as “anticipate,” “assume,” “believe,” “continue,” “could,” “design,” “estimate,” “expect,” “intend,” “may,” “plan,” “potentially,” “predict,” “should,” “will,” “would,” or the negative of these terms or other similar expressions. These forward-looking statements include, but are not limited to: in this Press Release and on our associated earnings call, statements regarding our second quarter of 2025 and full year 2025 business outlook and underlying expectations and assumptions and statements regarding our ability to obtain a comprehensive maturity extension amendment to our credit facility. These statements are based on various assumptions, whether or not identified in this Press Release, and on the current expectations of our management and are not predictions of actual performance.

These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond our control. These forward-looking statements are subject to a number of risks and uncertainties, including, among others, our ability to refinance our indebtedness and continue as a going concern, the execution of our business strategy and expanding information and technology capabilities; our market opportunity and our ability to acquire new customers and retain existing customers; adoption and success of our mobile application featuring Katapult Pay; the timing and impact of our growth initiatives on our future financial performance; anticipated occurrence and timing of prime lending tightening and impact on our results of operations; general economic conditions in the markets where we operate, the cyclical nature of customer spending, and seasonal sales and spending patterns of customers; risks relating to factors affecting consumer spending that are not under our control, including, among others, levels of employment, disposable consumer income, inflation, prevailing interest rates, consumer debt and availability of credit, consumer confidence in future economic conditions, political conditions, and consumer perceptions of personal well-being and security and willingness and ability of customers to pay for the goods they lease through us when due; risks relating to uncertainty of our estimates of market opportunity and forecasts of market growth; risks related to the concentration of a significant portion of our transaction volume with a single merchant partner, or type of merchant or industry; the effects of competition on our future business; meet future liquidity requirements and complying with restrictive covenants related to our long-term indebtedness; the impact of unstable market and economic conditions such as rising inflation and interest rates; reliability of our platform and effectiveness of our risk model; data security breaches or other information technology incidents or disruptions, including cyber-attacks, and the protection of confidential, proprietary, personal and other information, including personal data of customers; ability to attract and retain employees, executive officers or directors; effectively respond to general economic and business conditions; obtain additional capital, including equity or debt financing and servicing our indebtedness; enhance future operating and financial results; anticipate rapid technological changes, including generative artificial intelligence and other new technologies; comply with laws and regulations applicable to our business, including laws and regulations related to rental purchase transactions; stay abreast of modified or new laws and regulations applying to our business, including with respect to rental purchase transactions and privacy regulations; maintain and grow relationships with merchants and partners; respond to uncertainties associated with product and service developments and market acceptance; the impacts of new U.S. federal income tax laws; material weaknesses in our internal control over financial reporting which, if not identified and remediated, could affect the reliability of our financial statements; successfully defend litigation; litigation, regulatory matters, complaints, adverse publicity and/or misconduct by employees, vendors and/or service providers; and other events or factors, including those resulting from civil unrest, war, foreign invasions (including the conflict involving Russia and Ukraine and the Israel-Hamas conflict), terrorism, public health crises and pandemics (such as COVID-19), trade wars, or responses to such events; our ability to meet the minimum requirements for continued listing on the Nasdaq Global Market; and those factors discussed in greater detail in the section entitled “Risk Factors” in our periodic reports filed with the Securities and Exchange Commission (“SEC”), including the Annual Report on Form 10-K for the year ended December 31, 2024 that we filed with the SEC.

If any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that we do not presently know or that we currently believe are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. Undue reliance should not be placed on the forward-looking statements in this Press Release or on our quarterly earnings call. All forward-looking statements contained herein or expressed on our quarterly earnings call are based on information available to us as of the date hereof, and we do not assume any obligation to update these statements as a result of new information or future events, except as required by law. If we do update one or more forward-looking statements, no inference should be made that we will make additional updates with respect to those or other forward-looking statements.

Key Performance Metrics

Katapult regularly reviews several metrics, including the following key metrics, to evaluate its business, measure its performance, identify trends affecting our business, formulate financial projections and make strategic decisions, which may also be useful to an investor: gross originations, total revenue, gross profit, adjusted gross profit and adjusted EBITDA.

Gross originations are defined as the retail price of the merchandise associated with lease-purchase agreements entered into during the period through the Katapult platform. Gross originations do not represent revenue earned. However, we believe this is a useful operating metric for both Katapult’s management and investors to use in assessing the volume of transactions that take place on Katapult’s platform.

Total revenue represents the summation of rental revenue and other revenue. Katapult measures this metric to assess the total view of pay through performance of its customers. Management believes looking at these components is useful to an investor as it helps to understand the total payment performance of customers.

Gross profit represents total revenue less cost of revenue, and is a measure presented in accordance with generally accepted accounting principles in the United States (“GAAP”). See the “Non-GAAP Financial Measures” section below for a description and presentation of adjusted gross profit and adjusted EBITDA, which are non-GAAP measures utilized by management.

Non-GAAP Financial Measures

To supplement the financial measures presented in this press release and related conference call or webcast in accordance with GAAP, the Company also presents the following non-GAAP and other measures of financial performance: adjusted gross profit, adjusted EBITDA, adjusted net income/(loss) and fixed cash operating expenses. The Company believes that for management and investors to more effectively compare core performance from period to period, the non-GAAP measures should exclude items that are not indicative of our results from ongoing business operations.The Company urges investors to consider non-GAAP measures only in conjunction with its GAAP financials and to review the reconciliation of the Company’s non-GAAP financial measures to its comparable GAAP financial measures, which are included in this press release.

Adjusted gross profit represents gross profit less variable operating expenses, which are servicing costs, and underwriting fees. Management believes that adjusted gross profit provides a meaningful understanding of one aspect of its performance specifically attributable to total revenue and the variable costs associated with total revenue.

Adjusted EBITDA is a non-GAAP measure that is defined as net loss before interest expense and other fees, interest income, change in fair value of warrants and loss on issuance of shares, provision for income taxes, depreciation and amortization on property and equipment and capitalized software, provision of impairment of leased assets, loss on partial extinguishment of debt, stock-based compensation expense, litigation settlement and other related expenses, and debt refinancing costs.

Adjusted net income (loss) is a non-GAAP measure that is defined as net loss before change in fair value of warrants and loss on issuance of shares, stock-based compensation expense and litigation settlement and other related expenses and debt refinancing costs.

Fixed cash operating expenses is a non-GAAP measure that is defined as operating expenses less depreciation and amortization on property and equipment and capitalized software, stock-based compensation expense, litigation settlement and other related expenses, debt refinancing costs, and variable lease costs such as servicing costs and underwriting fees. Management believes that fixed cash operating expenses provides a meaningful understanding of non-variable ongoing expenses.

Adjusted gross profit, adjusted EBITDA and adjusted net loss are useful to an investor in evaluating the Company’s performance because these measures:

Are widely used to measure a company’s operating performance;
Are financial measurements that are used by rating agencies, lenders and other parties to evaluate the Company’s credit worthiness; and
Are used by the Company’s management for various purposes, including as measures of performance and as a basis for strategic planning and forecasting.

Management believes that the use of non-GAAP financial measures, as a supplement to GAAP measures, is useful to investors in that they eliminate items that are not part of our core operations, highly variable or do not require a cash outlay, such as stock-based compensation expense. Management uses these non-GAAP financial measures when evaluating operating performance and for internal planning and forecasting purposes. Management believes that these non-GAAP financial measures help indicate underlying trends in the business, are important in comparing current results with prior period results and are useful to investors and financial analysts in assessing operating performance. However, these non-GAAP measures exclude items that are significant in understanding and assessing Katapult’s financial results. Therefore, these measures should not be considered in isolation or as alternatives to revenue, net loss, gross profit, cash flows from operations or other measures of profitability, liquidity or performance under GAAP. You should be aware that Katapult’s presentation of these measures may not be comparable to similarly titled measures used by other companies.


KATAPULT HOLDINGS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (amounts in thousands, except per share data)
	Three Months Ended March 31,
		2025			2024

Revenue
Rental revenue	$	71,078		$	64,142
Other revenue		868			919
Total revenue		71,946			65,061
Cost of revenue		57,597			48,573
Gross profit		14,349			16,488
Operating expenses		14,885			12,688
Income (loss) from operations		(536	)		3,800
Interest expense and other fees		(5,144	)		(4,527	)
Interest income		57			324
Change in fair value of warrant liability		(36	)		(162	)
Loss before income taxes		(5,659	)		(565	)
Provision for income taxes		(29	)		(5	)
Net loss	$	(5,688	)	$	(570	)

Weighted average common shares outstanding – basic and diluted		4,618			4,242

Net loss per common share – basic and diluted	$	(1.23	)	$	(0.13	)


KATAPULT HOLDINGS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (dollars in thousands, except per share data)
	March 31,			December 31,
		2025			2024
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	5,965		$	3,465
Restricted cash		8,346			13,087
Property held for lease, net of accumulated depreciation and impairment		66,913			67,085
Prepaid expenses and other current assets		4,445			6,731
Total current assets		85,669			90,368
Property and equipment, net		244			253
Capitalized software and intangible assets, net		2,155			2,076
Right-of-use assets, non-current		376			383
Security deposits		91			91
Total assets	$	88,535		$	93,171
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable	$	3,040		$	1,491
Accrued liabilities		18,945			17,372
Accrued litigation settlement		2,199			2,199
Unearned revenue		5,711			4,823
Revolving line of credit, net		77,663			82,582
Term loan, net, current		31,490			30,047
Lease liabilities		129			179
Total current liabilities		139,177			138,693
Lease liabilities, non-current		431			444
Other liabilities		614			828
Total liabilities		140,222			139,965
STOCKHOLDERS’ DEFICIT
Common stock, $.0001 par value– 250,000,000 shares authorized; 4,483,544 and 4,446,540 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively		—			—
Additional paid-in capital		102,452			101,657
Accumulated deficit		(154,139	)		(148,451	)
Total stockholders’ deficit		(51,687	)		(46,794	)
Total liabilities and stockholders’ deficit	$	88,535		$	93,171


KATAPULT HOLDINGS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (dollars in thousands)
	Three Months Ended March 31,
		2025			2024
Cash flows from operating activities:
Net loss	$	(5,688	)	$	(570	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		39,392			34,026
Depreciation for early lease purchase options (buyouts)		9,664			7,613
Depreciation for impaired leases		6,632			5,636
Change in fair value of warrants and other non-cash items		36			162
Stock-based compensation		1,066			1,391
Amortization of debt discount		963			669
Amortization of debt issuance costs, net		88			66
Accrued PIK interest expense		480			347
Amortization of right-of-use assets		76			76
Changes in operating assets and liabilities:
Property held for lease		(55,185	)		(45,249	)
Prepaid expenses and other current assets		2,217			1,029
Accounts payable		1,549			754
Accrued liabilities		1,573			(4,123	)
Accrued litigation		(250	)		—
Lease liabilities		(63	)		(55	)
Unearned revenues		888			208
Net cash provided by operating activities		3,438			1,980
Cash flows from investing activities:
Purchases of property and equipment		(24	)		—
Additions to capitalized software		(377	)		(126	)
Net cash used in investing activities		(401	)		(126	)
Cash flows from financing activities:
Proceeds from revolving line of credit		5,128			10,058
Principal repayments on revolving line of credit		(10,135	)		(2,840	)
Repurchases of restricted stock		(271	)		(312	)
Net cash (used in) provided by financing activities		(5,278	)		6,906
Net (decrease) increase in cash, cash equivalents and restricted cash		(2,241	)		8,760
Cash and cash equivalents and restricted cash at beginning of period		16,552			28,811
Cash and cash equivalents and restricted cash at end of period	$	14,311		$	37,571
Supplemental disclosure of cash flow information:
Cash paid for interest	$	3,661		$	3,382
Cash paid for income taxes	$	—		$	112
Cash paid for operating leases	$	111		$	82


KATAPULT HOLDINGS, INC. RECONCILIATION OF NON-GAAP MEASURES AND CERTAIN OTHER DATA (UNAUDITED) (amounts in thousands)
	Three Months Ended March 31,
		2025			2024

Net loss	$	(5,688	)	$	(570	)
Add back:
Interest expense and other fees		5,144			4,527
Interest income		(57	)		(324	)
Change in fair value of warrants		36			162
Provision for income taxes		29			5
Depreciation and amortization on property and equipment and capitalized software		330			266
Provision for impairment of leased assets		150			173
Stock-based compensation expense		1,066			1,391
Litigation settlement and other related expenses		259		$	—
Debt refinancing costs	$	971			—
Adjusted EBITDA	$	2,240		$	5,630


	Three Months Ended March 31,
		2025			2024

Net loss	$	(5,688	)	$	(570	)
Add back:
Change in fair value of warrants		36			162
Stock-based compensation expense		1,066			1,391
Litigation settlement and other related expenses		259			—
Debt refinancing costs		971			—
Adjusted net income (loss)	$	(3,356	)	$	983


	Three Months Ended March 31,
		2025		2024

Operating expenses	$	14,885	$	12,688
Less:
Depreciation and amortization on property and equipment and capitalized software		330		266
Stock-based compensation expense		1,066		1,391
Servicing costs		1,085		1,132
Underwriting fees		772		509
Litigation settlement and other related expenses		259		—
Debt refinancing costs		971	$	—
Fixed cash operating expenses	$	10,402	$	9,390

(in thousands)	Three Months Ended March 31,
		2025		2024

Total revenue	$	71,946	$	65,061
Cost of revenue		57,597		48,573
Gross profit		14,349		16,488
Less:
Servicing costs		1,085		1,132
Underwriting fees		772		509
Adjusted gross profit	$	12,492	$	14,847


CERTAIN KEY PERFORMANCE METRICS

(in thousands)	Three Months Ended March 31,
		2025		2024
Total revenue	$	71,946	$	65,061


KATAPULT HOLDINGS, INC. GROSS ORIGINATIONS BY QUARTER
	Gross Originations by Quarter
($ millions)	Q1		Q2		Q3		Q4
FY 2025	$	64.2	$	—	$	—	$	—
FY 2024	$	55.6	$	55.3	$	51.2	$	75.2
FY 2023	$	54.7	$	54.7	$	49.6	$	67.5
FY 2022	$	46.7	$	46.4	$	44.1	$	59.8
FY 2021	$	63.8	$	64.4	$	61.0	$	58.9

The MIL Network –

May 16, 2025

MIL-OSI: Applied Materials Announces Second Quarter 2025 Results

Source: GlobeNewswire (MIL-OSI)

Revenue $7.10 billion, up 7 percent year over year
GAAP gross margin 49.1 percent and non-GAAP gross margin 49.2 percent
GAAP operating margin 30.5 percent and non-GAAP operating margin 30.7 percent
Record GAAP EPS $2.63 and record non-GAAP EPS $2.39, up 28 percent and 14 percent year over year, respectively
Generated $1.57 billion in cash from operations and distributed $2.00 billion to shareholders including $1.67 billion in share repurchases and $325 million in dividends

SANTA CLARA, Calif., May 15, 2025 (GLOBE NEWSWIRE) — Applied Materials, Inc. (NASDAQ: AMAT) today reported results for its second quarter ended Apr. 27, 2025.

“Applied Materials’ broad capabilities and connected product portfolio are driving strong results in 2025 amidst a highly dynamic macro environment,” said Gary Dickerson, President and CEO. “High-performance, energy-efficient AI computing remains the dominant driver of semiconductor innovation, and Applied is working closely with our customers and partners to accelerate the industry’s roadmap. We are very well positioned at major technology inflections in fast-growing areas of the market, which supports our multi-year growth trajectory.”

“We delivered strong performance in our second fiscal quarter with seven percent year-over-year revenue growth, record earnings per share and shareholder distributions of nearly $2 billion,” said Brice Hill, Senior Vice President and CFO. “Despite the dynamic economic and trade environment, we have not seen significant changes to customer demand and are well-equipped to navigate evolving conditions with our robust global supply chain and diversified manufacturing footprint.”

Results Summary

	Q2 FY2025			Q2 FY2024			Change
	(In millions, except per share amounts and percentages)
Net revenue	$	7,100		$	6,646		7%
Gross margin		49.1	%		47.4	%	1.7 points
Operating margin		30.5	%		28.8	%	1.7 points
Net income	$	2,137		$	1,722		24%
Diluted earnings per share	$	2.63		$	2.06		28%
Non-GAAP Results
Non-GAAP gross margin		49.2	%		47.5	%	1.7 points
Non-GAAP operating margin		30.7	%		29.0	%	1.7 points
Non-GAAP net income	$	1,940		$	1,744		11%
Non-GAAP diluted EPS	$	2.39		$	2.09		14%
Non-GAAP free cash flow	$	1,061		$	1,135		(7)%

A reconciliation of the GAAP and non-GAAP results is provided in the financial tables included in this release. See also “Use of Non-GAAP Financial Measures” section.

Business Outlook

Applied’s total net revenue, non-GAAP gross margin and non-GAAP diluted EPS for the third quarter of fiscal 2025 are expected to be approximately as follows:


	Q3 FY2025
(In millions, except percentage and per share amounts)
Total net revenue	$	7,200		+/-	$	500
Non-GAAP gross margin		48.3	%
Non-GAAP diluted EPS	$	2.35		+/-	$	0.20

This outlook for non-GAAP diluted EPS excludes known charges related to completed acquisitions of $0.01 per share, and includes a net income tax benefit related to intra-entity intangible asset transfers of $0.04 per share, but does not reflect any items that are unknown at this time, such as any additional charges related to acquisitions or other non-operational or unusual items, as well as other tax-related items, which we are not able to predict without unreasonable efforts due to their inherent uncertainty.

Second Quarter Reportable Segment Information

*Semiconductor Systems*	Q2 FY2025			Q2 FY2024
(in millions, except percentages)
Net revenue	$	5,255		$	4,901
Foundry, logic and other		65	%		65	%
DRAM		27	%		32	%
Flash memory		8	%		3	%
Operating income	$	1,900		$	1,701
Operating margin		36.2	%		34.7	%
Non-GAAP Results
Non-GAAP operating income	$	1,911		$	1,711
Non-GAAP operating margin		36.4	%		34.9	%

*Applied Global Services*	Q2 FY2025			Q2 FY2024
(in millions, except percentages)
Net revenue	$	1,566		$	1,530
Operating income	$	446		$	436
Operating margin		28.5	%		28.5	%
Non-GAAP Results
Non-GAAP operating income	$	446		$	436
Non-GAAP operating margin		28.5	%		28.5	%

*Display*	Q2 FY2025			Q2 FY2024
(in millions, except percentages)
Net revenue	$	259		$	179
Operating income	$	68		$	5
Operating margin		26.3	%		2.8	%
Non-GAAP Results
Non-GAAP operating income	$	68		$	5
Non-GAAP operating margin		26.3	%		2.8	%

*Corporate and Other*	Q2 FY2025			Q2 FY2024
(in millions)
Unallocated net revenue	$	20		$	36
Unallocated cost of products sold and expenses		(265	)		(266	)
Total	$	(245	)	$	(230	)

Use of Non-GAAP Financial Measures

Applied provides investors with certain non-GAAP financial measures, which are adjusted for the impact of certain costs, expenses, gains and losses, including certain items related to mergers and acquisitions; restructuring and severance charges and any associated adjustments; impairments of assets; gain or loss, dividends and impairments on strategic investments; certain income tax items and other discrete adjustments. On a non-GAAP basis, the tax effect related to share-based compensation is recognized ratably over the fiscal year. Reconciliations of these non-GAAP measures to the most directly comparable financial measures calculated and presented in accordance with GAAP are provided in the financial tables included in this release.

Management uses these non-GAAP financial measures to evaluate the company’s operating and financial performance and for planning purposes, and as performance measures in its executive compensation program. Applied believes these measures enhance an overall understanding of its performance and investors’ ability to review the company’s business from the same perspective as the company’s management, and facilitate comparisons of this period’s results with prior periods on a consistent basis by excluding items that management does not believe are indicative of Applied’s ongoing operating performance. There are limitations in using non-GAAP financial measures because the non-GAAP financial measures are not prepared in accordance with generally accepted accounting principles, may be different from non-GAAP financial measures used by other companies, and may exclude certain items that may have a material impact upon our reported financial results. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the directly comparable financial measures prepared in accordance with GAAP.

Webcast Information

Applied Materials will discuss these results during an earnings call that begins at 1:30 p.m. Pacific Time today. A live webcast and related slide presentation will be available at https://ir.appliedmaterials.com . A replay will be available on the website beginning at 5:00 p.m. Pacific Time today.

Forward-Looking Statements
This press release contains forward-looking statements, including those regarding anticipated growth and trends in our businesses and markets, industry outlooks and demand drivers, technology transitions, our business and financial performance and market share positions, our capital allocation and cash deployment strategies, our investment and growth strategies, our development of new products and technologies, our business outlook for the third quarter of fiscal 2025 and beyond, and other statements that are not historical facts. These statements and their underlying assumptions are subject to risks and uncertainties and are not guarantees of future performance. Factors that could cause actual results to differ materially from those expressed or implied by such statements include, without limitation: the level of demand for our products; global economic, political and industry conditions, including changes in interest rates and prices for goods and services; the implementation of additional export regulations and license requirements and their interpretation, and their impact on our ability to export products and provide services to customers and on our results of operations; global trade issues and changes in trade and export license policies and our ability to obtain licenses or authorizations on a timely basis, if at all; imposition of new or increases in tariffs and any retaliatory measures, including their impact on demand for our products and services; our ability to effectively mitigate the impact of tariffs; the effects of geopolitical turmoil or conflicts; demand for semiconductor chips and electronic devices; customers’ technology and capacity requirements; the introduction of new and innovative technologies, and the timing of technology transitions; our ability to develop, deliver and support new products and technologies; our ability to meet customer demand, and our suppliers’ ability to meet our demand requirements; the concentrated nature of our customer base; our ability to expand our current markets, increase market share and develop new markets; market acceptance of existing and newly developed products; our ability to obtain and protect intellectual property rights in key technologies; cybersecurity incidents affecting our information systems or information contained in them, or affecting our operations, suppliers, customers or vendors; our ability to achieve the objectives of operational and strategic initiatives, align our resources and cost structure with business conditions, and attract, motivate and retain key employees; the effects of regional or global health epidemics; acquisitions, investments and divestitures; changes in income tax laws; the variability of operating expenses and results among products and segments, and our ability to accurately forecast future results, market conditions, customer requirements and business needs; our ability to ensure compliance with applicable law, rules and regulations and other risks and uncertainties described in our SEC filings, including our recent Forms 10-Q and 8-K. All forward-looking statements are based on management’s current estimates, projections and assumptions, and we assume no obligation to update them.

About Applied Materials

Applied Materials, Inc. (Nasdaq: AMAT) is the leader in materials engineering solutions used to produce virtually every new chip and advanced display in the world. Our expertise in modifying materials at atomic levels and on an industrial scale enables customers to transform possibilities into reality. At Applied Materials, our innovations make possible a better future. Learn more at www.appliedmaterials.com.

Investor Relations Contact:
Liz Morali (408) 986-7977
liz_morali@amat.com

Media Contact:
Ricky Gradwohl (408) 235-4676
ricky_gradwohl@amat.com


APPLIED MATERIALS, INC. UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS

	Three Months Ended				Six Months Ended
(In millions, except per share amounts)	April 27, 2025		April 28, 2024		April 27, 2025		April 28, 2024
Net revenue	$	7,100	$	6,646	$	14,266	$	13,353
Cost of products sold		3,615		3,493		7,285		6,996
Gross profit		3,485		3,153		6,981		6,357
Operating expenses:
Research, development and engineering		893		785		1,752		1,539
Marketing and selling		216		209		422		416
General and administrative		207		247		463		523
Total operating expenses		1,316		1,241		2,637		2,478
Income from operations		2,169		1,912		4,344		3,879
Interest expense		68		59		132		118
Interest and other income (expense), net		221		141		229		536
Income before income taxes		2,322		1,994		4,441		4,297
Provision for income taxes		185		272		1,119		556
Net income	$	2,137	$	1,722	$	3,322	$	3,741
Earnings per share:
Basic	$	2.64	$	2.08	$	4.10	$	4.50
Diluted	$	2.63	$	2.06	$	4.08	$	4.47
Weighted average number of shares:
Basic		809		830		811		831
Diluted		812		836		815		837


APPLIED MATERIALS, INC. UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS

(In millions)	April 27, 2025		October 27, 2024
ASSETS
Current assets:
Cash and cash equivalents	$	6,169	$	8,022
Short-term investments		578		1,449
Accounts receivable, net		6,187		5,234
Inventories		5,656		5,421
Other current assets		1,118		1,094
Total current assets		19,708		21,220
Long-term investments		3,638		2,787
Property, plant and equipment, net		3,832		3,339
Goodwill		3,748		3,732
Purchased technology and other intangible assets, net		249		249
Deferred income taxes and other assets		2,457		3,082
Total assets	$	33,632	$	34,409
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Short-term debt	$	799	$	799
Accounts payable and accrued expenses		4,706		4,820
Contract liabilities		2,491		2,849
Total current liabilities		7,996		8,468
Long-term debt		5,462		5,460
Income taxes payable		321		670
Other liabilities		892		810
Total liabilities		14,671		15,408
Total stockholders’ equity		18,961		19,001
Total liabilities and stockholders’ equity	$	33,632	$	34,409


APPLIED MATERIALS, INC. UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

	Three Months Ended						Six Months Ended
(In millions)	April 27, 2025			April 28, 2024			April 27, 2025			April 28, 2024
Cash flows from operating activities:
Net income	$	2,137		$	1,722		$	3,322		$	3,741
Adjustments required to reconcile net income to cash provided by operating activities:
Depreciation and amortization		103			96			208			187
Share-based compensation		159			134			354			304
Deferred income taxes		4			(134	)		672			(206	)
Other		(109	)		(12	)		(14	)		(247	)
Net change in operating assets and liabilities		(723	)		(414	)		(2,046	)		(62	)
Cash provided by operating activities		1,571			1,392			2,496			3,717
Cash flows from investing activities:
Capital expenditures		(510	)		(257	)		(891	)		(486	)
Cash paid for acquisitions, net of cash acquired		(1	)		—			(29	)		—
Proceeds from asset sale		33			—			33			—
Proceeds from sales and maturities of investments		1,921			582			3,144			1,113
Purchases of investments		(1,222	)		(474	)		(2,933	)		(1,223	)
Cash provided by (used in) investing activities		221			(149	)		(676	)		(596	)
Cash flows from financing activities:
Proceeds from issuance of commercial paper		100			100			300			200
Repayments of commercial paper		(100	)		(100	)		(300	)		(200	)
Proceeds from common stock issuances		129			119			129			119
Common stock repurchases		(1,670	)		(820	)		(2,988	)		(1,520	)
Tax withholding payments for vested equity awards		(35	)		(41	)		(177	)		(233	)
Payments of dividends to stockholders		(325	)		(266	)		(651	)		(532	)
Payments of debt issuance costs		(2	)		—			(2	)		—
Repayments of principal on finance leases		—			(14	)		—			(13	)
Cash used in financing activities		(1,903	)		(1,022	)		(3,689	)		(2,179	)
Increase (decrease) in cash, cash equivalents and restricted cash equivalents		(111	)		221			(1,869	)		942
Cash, cash equivalents and restricted cash equivalents—beginning of period		6,355			6,954			8,113			6,233
Cash, cash equivalents and restricted cash equivalents — end of period	$	6,244		$	7,175		$	6,244		$	7,175

Reconciliation of cash, cash equivalents, and restricted cash equivalents
Cash and cash equivalents	$	6,169		$	7,085		$	6,169		$	7,085
Restricted cash equivalents included in deferred income taxes and other assets		75			90			75			90
Total cash, cash equivalents, and restricted cash equivalents	$	6,244		$	7,175		$	6,244		$	7,175

Supplemental cash flow information:
Cash payments for income taxes	$	763		$	467		$	833		$	606
Cash refunds from income taxes	$	5		$	3		$	75		$	5
Cash payments for interest	$	68		$	68		$	120		$	102

Additional Information

	Q2 FY2025			Q2 FY2024
Net Revenue by Geography (In millions)
United States	$	808		$	853
% of Total		11	%		13	%
Europe	$	252		$	289
% of Total		4	%		4	%
Japan	$	572		$	453
% of Total		8	%		7	%
Korea	$	1,562		$	988
% of Total		22	%		15	%
Taiwan	$	1,997		$	1,019
% of Total		28	%		15	%
Southeast Asia	$	135		$	213
% of Total		2	%		3	%
China	$	1,774		$	2,831
% of Total		25	%		43	%

Employees(In thousands)
Regular Full Time		36.0			34.8


APPLIED MATERIALS, INC. UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP RESULTS

	Three Months Ended						Six Months Ended
(In millions, except percentages)	April 27, 2025			April 28, 2024			April 27, 2025			April 28, 2024
Non-GAAP Gross Profit
GAAP reported gross profit	$	3,485		$	3,153		$	6,981		$	6,357
Certain items associated with acquisitions¹		6			7			13			14
Non-GAAP gross profit	$	3,491		$	3,160		$	6,994		$	6,371
Non-GAAP gross margin		49.2	%		47.5	%		49.0	%		47.7	%
Non-GAAP Operating Income
GAAP reported operating income	$	2,169		$	1,912		$	4,344		$	3,879
Certain items associated with acquisitions¹		11			10			23			21
Acquisition integration and deal costs		—			5			3			8
Non-GAAP operating income	$	2,180		$	1,927		$	4,370		$	3,908
Non-GAAP operating margin		30.7	%		29.0	%		30.6	%		29.3	%
Non-GAAP Net Income
GAAP reported net income	$	2,137		$	1,722		$	3,322		$	3,741
Certain items associated with acquisitions¹		11			10			23			21
Acquisition integration and deal costs		—			5			3			8
Realized loss (gain), dividends and impairments on strategic investments, net		(18	)		(3	)		(27	)		(4	)
Unrealized loss (gain) on strategic investments, net		(80	)		(20	)		26			(300	)
Foreign exchange loss (gain) related to purchase of strategic investment		23			—			23			—
Loss (gain) on asset sale		(44	)		—			(44	)		—
Income tax effect of share-based compensation²		4			11			(6	)		(15	)
Income tax effects related to intra-entity intangible asset transfers³		32			18			706			40
Resolution of prior years’ income tax filings and other tax items		(124	)		—			(140	)		33
Income tax effect of non-GAAP adjustments⁴		(1	)		1			—			2
Non-GAAP net income	$	1,940		$	1,744		$	3,886		$	3,526

1		These items are incremental charges attributable to completed acquisitions, consisting of amortization of purchased intangible assets.

2		GAAP basis tax benefit related to share-based compensation is recognized ratably over the fiscal year on a non-GAAP basis.

3		Amount for the six months ended April 27, 2025, included changes to income tax provision of $62 million from amortization of intangibles and a $644 million remeasurement of deferred tax assets resulting from new tax incentive agreements in Singapore in the first quarter of fiscal 2025.

4		Adjustment to provision for income taxes related to non-GAAP adjustments reflected in income before income taxes.


APPLIED MATERIALS, INC. UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP RESULTS

	Three Months Ended						Six Months Ended
(In millions, except per share amounts)	April 27, 2025			April 28, 2024			April 27, 2025			April 28, 2024
Non-GAAP Earnings Per Diluted Share
GAAP reported earnings per diluted share	$	2.63		$	2.06		$	4.08		$	4.47
Certain items associated with acquisitions		0.01			0.01			0.02			0.02
Acquisition integration and deal costs		—			0.01			—			0.01
Realized loss (gain), dividends and impairments on strategic investments, net		(0.02	)		—			(0.03	)		—
Unrealized loss (gain) on strategic investments, net		(0.10	)		(0.02	)		0.03			(0.36	)
Foreign exchange loss (gain) related to purchase of strategic investment		0.03			—			0.03			—
Loss (gain) on asset sale		(0.05	)		—			(0.05	)		—
Income tax effect of share-based compensation		—			0.01			(0.01	)		(0.02	)
Income tax effects related to intra-entity intangible asset transfers¹		0.04			0.02			0.87			0.05
Resolution of prior years’ income tax filings and other tax items		(0.15	)		—			(0.17	)		0.04
Non-GAAP earnings per diluted share	$	2.39		$	2.09		$	4.77		$	4.21
Weighted average number of diluted shares		812			836			815			837

1		Amount for the six months ended April 27, 2025, included changes to income tax provision of $0.08 per diluted share from amortization of intangibles and $0.79 per diluted share from a remeasurement of deferred tax assets resulting from new tax incentive agreements in Singapore in the first quarter of fiscal 2025.


APPLIED MATERIALS, INC. UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP RESULTS

	Three Months Ended						Six Months Ended
(In millions, except percentages)	April 27, 2025			April 28, 2024			April 27, 2025			April 28, 2024
Semiconductor Systems Non-GAAP Operating Income
GAAP reported operating income	$	1,900		$	1,701		$	3,886		$	3,445
Certain items associated with acquisitions¹		11			10			23			20
Non-GAAP operating income	$	1,911		$	1,711		$	3,909		$	3,465
Non-GAAP operating margin		36.4	%		34.9	%		36.8	%		35.3	%
Applied Global Services Non-GAAP Operating Income
GAAP reported operating income	$	446		$	436		$	893		$	853
Non-GAAP operating income	$	446		$	436		$	893		$	853
Non-GAAP operating margin		28.5	%		28.5	%		28.3	%		28.4	%
Display Non-GAAP Operating Income
GAAP reported operating income	$	68		$	5		$	82		$	30
Non-GAAP operating income	$	68		$	5		$	82		$	30
Non-GAAP operating margin		26.3	%		2.8	%		18.6	%		7.1	%

1		These items are incremental charges attributable to completed acquisitions, consisting of amortization of purchased intangible assets.

Note: The reconciliation of GAAP and non-GAAP segment results above does not include certain revenues, costs of products sold and operating expenses that are reported within corporate and other and included in consolidated operating income.


APPLIED MATERIALS, INC. UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP EFFECTIVE INCOME TAX RATE

	Three Months Ended
(In millions, except percentages)	April 27, 2025

GAAP provision for income taxes (a)	$	185
Income tax effect of share-based compensation		(4	)
Income tax effects related to intra-entity intangible asset transfers		(32	)
Resolutions of prior years’ income tax filings and other tax items		124
Income tax effect of non-GAAP adjustments		1
Non-GAAP provision for income taxes (b)	$	274

GAAP income before income taxes (c)	$	2,322
Certain items associated with acquisitions		11
Realized loss (gain), dividends and impairments on strategic investments, net		(18	)
Unrealized loss (gain) on strategic investments, net		(80	)
Foreign exchange loss (gain) related to purchase of strategic investment		23
Loss (gain) on asset sale		(44	)
Non-GAAP income before income taxes (d)	$	2,214

GAAP effective income tax rate (a/c)		8.0	%

Non-GAAP effective income tax rate (b/d)		12.4	%


UNAUDITED RECONCILIATION OF NON-GAAP FREE CASH FLOW

	Three Months Ended						Six Months Ended
(In millions)	April 27, 2025			April 28, 2024			April 27, 2025			April 28, 2024
Cash provided by operating activities	$	1,571		$	1,392		$	2,496		$	3,717
Capital expenditures		(510	)		(257	)		(891	)		(486	)
Non-GAAP free cash flow	$	1,061		$	1,135		$	1,605		$	3,231

The MIL Network –

May 16, 2025

MIL-OSI: Fold Holdings Inc. (NASDAQ: FLD) Announces First Quarter 2025 Results

Source: GlobeNewswire (MIL-OSI)

Revenue: $7.1 million, 44% YoY increase
Bitcoin Treasury Holdings: 1,490 BTC, ~50% increase from Q4 2024
Launched Bitcoin Gift Card with access to network of thousands of retailers
New accounts up over 300% YoY and platform volumes up 67% YoY

PHOENIX, May 15, 2025 (GLOBE NEWSWIRE) — Fold Holdings, Inc. (NASDAQ: FLD) (“Fold”), the first publicly traded bitcoin financial services company, today announced financial results for the first quarter ended March 31, 2025.

Financial Highlights

Revenue: $7.1 million; 44% YoY increase
GAAP Net Loss: ($48.9) million
Adjusted EBITDA (Loss) (non-GAAP): ($4.2) million
GAAP Loss Per Share: ($1.92) per share
Adjusted EBITDA (Loss) Per Share (non-GAAP): ($0.17) per share
Bitcoin Treasury Holdings: 1,490 bitcoin; +$150 million value as of 5/13/2025

Key Operating Metrics

Total Transaction Volume: +$250 million; 67% YoY increase
Total Active Accounts: +600,000, added +17,000 new accounts in the quarter
Total Verified Accounts: +76,000, added +5,000 new verified accounts in the quarter

CEO Commentary

“We are pleased to report a strong first quarter, with revenues for the period increasing by 44% versus a year ago, while core KPIs such as Active Accounts and Transaction Volumes were also up”, said Fold Chairman and CEO, Will Reeves. “From Fold’s public listing in February to our recent new product announcements, we have already made meaningful progress in 2025.”

Mr. Reeves continued, “In particular, we made significant progress on new initiatives that we believe improve the growth prospects for Fold. First, in February, we announced the launch of the Fold Bitcoin Rewards Credit Card, which currently has a waitlist of 75,000 people. We are working towards launching the card later this year and believe it can be an important growth driver of Fold’s business. Second, we are prioritizing the expansion of our Custody and Trading business by adding enhanced functionality to the platform. Our initiatives include increasing access to the platform beyond Fold cardholders to all users, supporting larger bitcoin orders through acceptance of wire deposits, and expanding the geographic reach of Fold’s suite of services. We believe these developments will allow us to open our platform to a meaningfully larger market. Our most recent announcement, the Fold Bitcoin Gift Card, is designed to allow consumers to acquire bitcoin by purchasing the Fold Bitcoin Gift Card online and at participating retail locations throughout the United States. Americans spend billions of dollars annually on gift cards and we believe the Fold Bitcoin Gift Card will allow us to capitalize on this large and meaningful market.”

Reeves concluded, “Finally, our bitcoin treasury holdings increased by 50% during the first quarter and currently stands at 1,490 bitcoin, which represents more than $150 million of value based on recent bitcoin prices. At Fold, we remain committed believers in Bitcoin and see it as central to everything we do. Building on our first quarter of 2025, we will continue to seek opportunities to add to our bitcoin holdings and believe in the long-term value proposition of a robust bitcoin treasury strategy.”

Strategic & Business Updates:

Fold Credit Card (announced in February 2025)
- Over 75,000 applicants on the waitlist
- 215 million credit cards users in the US
- Expected to launch later this year
Fold Bitcoin Gift Card (announced May 15, 2025)
- Partnered with Totus for a target nationwide launch later this year
- Rollout will be in phases with initial accessibility through Fold’s website
- Full rollout expected to include deployment to thousands of online and physical locations throughout the US
Custody and Trading Expansion
- Expanding accessibility to our bitcoin exchange platform to a larger user base
- Expanding features and making the platform accessible in additional states
Bitcoin Treasury
- Expanded our bitcoin investment treasury by approximately 50% in Q1 2025
- Currently hold 1,490 Bitcoin with a value of over $150 million

2025 Full Year Outlook:

Revenue: Prior guidance of $61.6 million in 2025 remains unchanged
Marketing Expenses: $3 million, an approximately 10x increase from 2024

Earnings Call and Webcast Information:

Fold Inc. will host a conference call at 5:00 p.m. Eastern Time today, which will include a brief discussion of results followed by a question and answer period. To participate in this event, please log on or dial in approximately 5 minutes before the beginning of the call.

Date: May 15, 2025
Time: 5:00 p.m. ET
Participant Call Links:

Live Webcast: Link
Dial-in Registration Link: Link

A replay of the call will be archived at https://investor.foldapp.com

About Fold Inc.:

Fold (NASDAQ: FLD) is the first publicly traded Bitcoin financial services company, making it easy for individuals and businesses to earn, save, and use Bitcoin. With 1,490 BTC in its treasury, Fold is at the forefront of integrating Bitcoin into everyday financial experiences. Through innovative products like the Fold App, Fold Card, Fold Credit Card, and Fold Bitcoin Gift Card, the company is building the bridge between traditional finance and the Bitcoin-powered future.

Forward-Looking Statements:

The information in this press release includes “forward-looking statements” within the meaning of the federal securities laws with respect to the anticipated benefits of the business combination. Forward-looking statements may be identified by the use of words such as “may,” “could,” “would,” “should,” “predict,” “estimate,” “plan,” “project,” “forecast,” “intend,” “will,” “expect,” “anticipate,” “believe,” or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements include the potential benefits of the new convertible note, Fold’s treasury strategy and the potential success of Fold’s market and growth strategies. These statements are based on assumptions and on the current expectations of Fold’s management and are not predictions of actual performance. Many actual events and circumstances are beyond the control of Fold. These forward-looking statements are subject to a number of risks and uncertainties, including: (i) changes in domestic and foreign business, market, financial, political and legal conditions; (ii) the failure to realize the anticipated benefits of the business combination; (iii) the effect of the consummation of the business combination on Fold’s business relationships, performance, and business generally; (iv) the ability to implement business plans and other expectations after the completion of the business combination, and identify and realize additional opportunities; (v) the risk of downturns, new entrants and a changing regulatory landscape in the highly competitive industry in which Fold operates; and (vi) those factors discussed in Fold’s filings with the Securities and Exchange Commission. If any of these risks materialize or Fold’s assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. While Fold may elect to update these forward-looking statements at some point in the future, each specifically disclaims any obligation to do so, except as required by law.

Fold Holdings, Inc. Condensed Balance Sheets (Unaudited)

	March 31,			December 31,
	2025			2024
Assets
Current assets
Cash and cash equivalents	$	11,699,552		$	18,330,359
Accounts receivable, net		942,888			451,455
Inventories		403,595			262,813
Digital assets – rewards treasury		7,365,544			8,569,651
Prepaid expenses and other current assets		4,003,918			687,100
Total current assets		24,415,497			28,301,378
Digital assets – investment treasury		122,957,753			93,568,700
Capitalized software development costs, net		1,175,215			1,000,065
Deferred transaction costs		–			2,784,893
Total assets	$	148,548,465		$	125,655,036

Liabilities and stockholders’ equity (deficit)
Current liabilities
Accounts payable	$	1,486,978		$	1,113,552
Accrued expenses and other current liabilities		1,898,812			71,858
December 2024 convertible note, net		–			11,752,905
Customer rewards liability		7,365,544			8,569,651
Deferred revenue		358,716			387,776
Total current liabilities		11,110,050			21,895,742
Deferred revenue, long-term		470,176			487,690
December 2024 convertible note, net		12,278,826			–
March 2025 convertible note – related party		52,813,643			–
Simple Agreements for Future Equity (“SAFEs”)		–			171,080,533
Total liabilities		76,672,695			193,463,965
Commitments and contingencies (Note 13)
Stockholders’ equity (deficit)
Preferred stock, $0.0001 par value; 20,000,000 shares authorized, 0 shares issued and outstanding at March 31, 2025 and 10,204,880 shares issued and outstanding at December 31, 2024		–			1,020
Common stock, $0.0001 par value; 600,000,000 shares authorized, 46,888,876 shares issued and 46,250,665 shares outstanding at March 31, 2025 and 5,836,882 shares issued and outstanding at December 31, 2024		4,625			584
Additional paid-in-capital		222,098,867			33,537,989
Accumulated deficit		(150,227,722	)		(101,348,522	)
Total stockholders’ equity (deficit)		71,875,770			(67,808,929	)
Total liabilities and stockholders’ equity	$	148,548,465		$	125,655,036

Fold Holdings, Inc. Condensed Statements of Operations (Unaudited)

	Three Months Ended March 31,
	2025			2024
Revenues, net	$	7,087,837		$	4,931,211

Operating expenses
Banking and payment costs		6,758,924			4,626,748
Custody and trading costs		45,785			21,288
Compensation and benefits		6,457,940			757,365
Marketing expenses		399,798			42,467
Professional fees		1,788,505			36,668
Amortization expense		91,071			57,353
(Gain) loss on customer rewards liability		(1,100,857	)		3,423,045
Loss (gain) on digital assets – rewards treasury		1,010,586			(3,491,889	)
Other selling, general and administrative expenses		1,136,455			312,894
Total operating expenses		16,588,207			5,785,939
Operating loss		(9,500,370	)		(854,728	)

Other income (expense)
Loss on digital assets – investment treasury		(15,617,152	)		–
Change in fair value of SAFEs		(6,503,113	)		(95,064	)
Change in fair value of convertible note		(6,534,143	)		–
Convertible note issuance costs and fees		(9,569,109	)		–
Interest expense		(1,271,638	)		–
Other income		120,303			12,855
Other income (expense), net		(39,374,852	)		(82,209	)

Net loss before income taxes		(48,875,222	)		(936,937	)
Income tax expense		3,978			8,109
Net loss	$	(48,879,200	)	$	(945,046	)

Net loss per share attributable to common stockholders:
Basic and diluted	$	(1.92	)	$	(0.16	)
Weighted average common shares outstanding:
Basic and diluted		25,436,398			5,836,882

Fold Holdings, Inc. Condensed Statements of Cash Flows (Unaudited)

	Three Months Ended March 31,
	2025			2024
Cash flows from operating activities
Net loss	$	(48,879,200	)	$	(945,046	)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization expense		91,071			57,353
Loss (gain) on digital assets – rewards treasury		1,010,586			(3,491,889	)
Loss on digital assets – investment treasury		15,617,152			–
(Gain) loss on customer rewards liability		(1,100,857	)		3,423,045
Change in fair value of convertible note		6,534,143			–
Convertible note issuance costs and fees		9,569,109			–
Amortization of debt discount		525,921			–
Change in fair value of SAFEs		6,503,113			95,064
Share-based compensation expense		5,170,275			–
Increase (decrease) in cash resulting from changes in:
Accounts receivable, net		(491,433	)		(38,400	)
Inventories		(140,782	)		(11,860	)
Prepaid expenses and other current assets		(962,423	)		9,756
Accounts payable		373,426			168,239
Accrued expenses and other current liabilities		660,721			10,908
Customer reward liability		611,552			487,032
Deferred revenue		(46,574	)		(118,433	)
Net cash used in operating activities		(4,954,200	)		(354,231	)

Cash flows from investing activities
Purchases of digital assets		(1,562,973	)		(441,467	)
Proceeds from sales of digital assets		–			–
Payments for capitalized software development costs		(266,221	)		(171,134	)
Net cash used in investing activities		(1,829,194	)		(612,601	)

Cash flows from financing activities
Proceeds from recapitalization		804,600			–
Payments of deferred IPO costs		(652,013	)		–
Proceeds received from SAFE financings		–			500,000
Net cash provided by financing activities		152,587			500,000

Net decrease in cash and cash equivalents		(6,630,807	)		(466,832	)
Cash and cash equivalents, beginning of period		18,330,359			1,491,544
Cash and cash equivalents, end of period	$	11,699,552		$	1,024,712

Non-cash investing and financing activities
Distributions of digital assets to fulfill customer reward redemptions		714,802			1,317,262
Distributions of digital assets to satisfy other current liabilities		1,012			8,940
Recapitalization		173,019,904			–
Proceeds from convertible debt received in digital assets – related party		43,965,525			–
Distributions of digital assets for prepaid interest – related party		2,313,975			–

Non-GAAP Financial Measures

Adjusted EBITDA

In addition to net loss and other results under GAAP, we utilize non-GAAP calculations of adjusted earnings before interest, taxes, depreciation, and amortization (“Adjusted EBITDA”) to monitor the financial health of our business. Adjusted EBITDA is defined as net loss, excluding (i) interest expense, (ii) provision for (benefit from) income taxes, (iii) depreciation and amortization, (iv) share-based compensation, (v) remeasurement gains and losses such as fair value remeasurements on our digital assets, convertible notes, and SAFE notes, and (vi) impairments, restructuring charges, and business acquisition- or disposition-related expenses that we believe are not indicative of our core operating results. This non-GAAP financial information is presented for supplemental informational purposes only, should not be considered in isolation or as a substitute for, or superior to, financial information presented in accordance with GAAP, and may be different from similarly titled non-GAAP measures used by other companies.

The above items are excluded from our Adjusted EBITDA measure because these items are non-cash in nature, or because the amount and timing of these items are unpredictable, are not driven by core results of operations, and/or render comparisons with prior periods and competitors less meaningful. We believe Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our results of core operations, as well as providing a useful measure for period-to-period comparisons of our business performance. Moreover, Adjusted EBITDA is a key measurement used by our management internally to make operating decisions, including those related to operating expenses, evaluate performance, and perform strategic planning and annual budgeting.

The following table presents a reconciliation of Adjusted EBITDA to the most directly comparable GAAP measure, net loss:

	Three Months Ended March 31,
	2025			2024
Net loss	$	(48,879,200	)	$	(945,046	)
Add:
Interest expense		1,271,638			–
Income tax expense		3,978			8,109
Amortization expense		91,071			57,353
Share-based compensation expense		5,170,275			–
(Gain) loss on customer rewards liability		(1,100,857	)		3,423,045
Loss (gain) on digital assets – rewards treasury		1,010,586			(3,491,889	)
Loss on digital assets – investment treasury		15,617,152			–
Change in fair value of SAFEs		6,503,113			95,064
Change in fair value of convertible note		6,534,143			–
Convertible note issuance costs and fees		9,569,109			–
Adjusted EBITDA (non-GAAP)	$	(4,208,992	)	$	(853,364	)

	Three Months Ended March 31,
	2025			2024
Adjusted EBITDA (Loss)	$	(4,208,992	)	$	(853,364	)
Weighted-average shares used to compute basic and diluted net loss per share		25,436,398			5,836,882

Adjusted EBITDA (Loss) per share attributable to common stockholders:
Basic and diluted	$	(0.17	)	$	(0.15	)

For investor and media inquiries, please contact:

Investor Relations:
Orange Group
Samir Jain, CFA
FoldIR@orangegroupadvisors.com

Media:
Elev8 New Media
Jessica Starman, MBA
Media@foldapp.com

The MIL Network –

May 16, 2025

MIL-OSI: Expion360 Reports First Quarter 2025 Financial Results

Source: GlobeNewswire (MIL-OSI)

Q1 2025 Revenue Growth of 111% Driven by New Products and Technologies

5th Consecutive Quarter of Robust Revenue Growth

Began Shipping e360 Home Energy Storage Solutions

REDMOND, Ore., May 15, 2025 (GLOBE NEWSWIRE) — Expion360 Inc. (Nasdaq: XPON) (“Expion360” or the “Company”), an industry leader in lithium-ion battery power storage, today reported its financial and operational results for the first quarter ended March 31, 2025.

First Quarter 2025 & Subsequent Financial & Operational Highlights

Q1 2025 revenue totaled $2.0 million, up 111% from Q1 2024, and 3% sequentially from Q4 2024.
5th consecutive quarter of sequential revenue growth.
Began fulfilling purchase orders for our e360 Home Energy Storage Solutions (“HESS”).
Closed a $2.6 million registered direct offering and private placement priced at the market under Nasdaq rules.

Management Commentary

“The first quarter of 2025 was underscored by continued strong revenue momentum, margin expansion and a strengthened balance sheet as we focus on entering into new OEM partnerships and distributor relationships and building our Home Energy Storage Solutions vertical,” said Brian Schaffner, Chief Executive Officer and Interim Chief Financial Officer of Expion360. “Revenue grew 111% year over year to $2.0 million, and sequentially for a fifth consecutive quarter from Q4 2024 on a rebounding RV market. Results for the RV Industry Association’s (RVIA) March 2025 survey of manufacturers found that total RV shipments increased 14% in the first quarter of 2025. We believe the RV market will continue to gain ground through 2025, with shipments increasing throughout the year.

“In January, we began production shipments for our HESS products. The LiFePO4 battery HESS enables residential and small business customers to create their own stable micro-energy grid and lessen the impact of increasing power fluctuations and outages. HESS is designed with adaptability in mind, ready to evolve alongside changing energy requirements. We also anticipate HESS will benefit from incentives available through California’s Self-Generation Incentive Program and federal tax credits, and we are working on additional orders in 2025.

“Operationally during the quarter, we took the opportunity to prepare for continued growth and tariff mitigation by adding 6-12 months of inventory early in the quarter, before new tariffs were introduced. We are also working to diversify our supply chain with potential sourcing from additional countries and have undertaken several initiatives to increase margins and reduce costs within our current line of batteries. Our long-term goal is to onshore to the U.S. manufacturing of most of our components and assemblies, including cell manufacturing. To that end, we continue to work with NeoVolta to combine our strengths toward a potential collaboration that aims to engineer a US-based state-of-the-art battery manufacturing facility and develop innovative lithium-ion battery cell and module product designs.

“Looking ahead, we are successfully executing on our efforts to expand sales across our product portfolio and new Home Energy Storage Solutions vertical. With a strengthened balance sheet from a recent $2.6 million registered direct offering and private placement, we believe we are well positioned to continue our growth initiatives to add OEM partnerships and distributors, further develop HESS, and introduce new technologies and batteries. With substantial purchase orders already in hand and additional new customers expressing interest across our product line, we look forward to announcements of additional milestones in the months ahead and expect our quarterly sequential growth to continue,” concluded Mr. Schaffner.

First Quarter 2025 Financial Summary

Revenue in the first quarter of 2025 totaled $2.0 million, an increase of 111% from $1.0 million in the prior year period. The increase in net sales was due, in part, to a rebound in the RV market overall, as well as completing our first sales in the home energy market.

Gross profit in the first quarter of 2025 totaled $0.5 million, or 25% of revenue, as compared to $0.2 million or 23% of revenue in the prior year period and 21% of revenue for the full fiscal year ended December 31, 2024. The increase was primarily attributable to the increase in sales and lower cost of goods sold as a percentage of sales.

Selling, general and administrative expenses in the first quarter of 2025 decreased 25% to $1.6 million compared to $2.2 million in the prior year period. The decrease was primarily due to decreases in salaries and benefits, including lower non-cash stock-based compensation, as well as reduction in headcount. Legal and professional fees also had a significant decrease, as did rent expense due to terminating the lease on our second warehouse.

Net loss in the first quarter of 2025 totaled $1.2 million, a 48% improvement from a net loss of $2.2 million in the prior year period. The decrease in net loss was primarily the result of higher net sales for the period ended March 31, 2025 combined with a decrease in selling, general, and administrative expenses.

Cash and cash equivalents totaled $1.1 million as of March 31, 2025, compared to $0.5 million as of December 31, 2024. On January 3, 2025, the Company closed a $2.6 million registered direct offering and private placement priced at the market under Nasdaq rules.

Net cash used in operating activities totaled $1.2 million for the three months ended March 31, 2025, compared to $1.7 million in the prior year period. Receiving inventory that was prepaid during the prior period accounted for a large portion of the change for the three months ending March 31, 2025, as well as making payments to decrease our suspended liability.

First Quarter 2025 Results Conference Call

Brian Schaffner, Chief Executive Officer and Interim Chief Financial Officer of Expion360, will host the conference call, followed by a question-and-answer period. The conference call will be accompanied by a presentation, which can be viewed during the webcast or accessed via the investor relations section of the Company’s website here.

To access the call, please use the following information:

A telephone replay will be available approximately three hours after the call and will remain available through May 29, 2025, by dialing 1-844-512-2921 from the U.S., or 1-412-317-6671 from international locations, and entering replay pin number: 10199138. The replay can also be viewed through the webcast link above and the presentation utilized during the call will be available via the investor relations section of the Company’s website here.

About Expion360

Expion360 is an industry leader in premium lithium iron phosphate (LiFePO4) batteries and accessories for recreational vehicles, marine applications, Light EV and residential energy storage.

The Company’s lithium-ion batteries feature half the weight of standard lead-acid batteries while delivering three times the power and ten times the number of charging cycles. Expion360 batteries also feature better construction and reliability compared to other lithium-ion batteries on the market due to their superior design and quality materials. Specially reinforced, fiberglass-infused, premium ABS and solid mechanical connections help provide top performance and safety. With Expion360 batteries, adventurers can enjoy the most beautiful and remote places on Earth even longer.

The Company is headquartered in Redmond, Oregon. Expion360 lithium-ion batteries are available today through more than 300 dealers, wholesalers, private-label customers, and OEMs across the country. To learn more about the Company, visit expion360.com.

Forward-Looking Statements

The foregoing material may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, each as amended. Forward-looking statements include all statements that do not relate solely to historical or current facts, including without limitation statements regarding the Company’s business prospects, and can be identified by the use of words such as “may,” “will,” “expect,” “project,” “estimate,” “anticipate,” “plan,” “believe,” “potential,” “should,” “continue” or the negative versions of those words or other comparable words. Forward-looking statements included in this press release include, but are not limited to, statements relating to the Company’s beliefs, plans, and expectations about its operations, product development and pipeline, growth prospects, market expectations and opportunity, the availability of incentives and tax credits, potential partnership with NeoVolta, and growth expectations. Forward-looking statements are not guarantees of future actions or performance. These forward-looking statements are based on information currently available to the Company and its current plans or expectations and are subject to a number of risks and uncertainties that could significantly affect current plans. Should one or more of these risks or uncertainties materialize, or the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended, or planned. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, the Company cannot guarantee future results, performance, or achievements. Except as required by applicable law, including the security laws of the United States, the Company does not intend to update any of the forward-looking statements to conform these statements to actual results.

Company Contact:
Brian Schaffner, CEO and Interim CFO
541-797-6714
Email Contact

External Investor Relations:
Chris Tyson, Executive Vice President
MZ Group – MZ North America
949-491-8235
XPON@mzgroup.us
www.mzgroup.us


EXPION360 INC. BALANCE SHEETS

	As of March 31, 2025 (Unaudited)			As of December 31, 2024
Assets
Current Assets
Cash and cash equivalents	$	1,092,607		$	547,565
Accounts receivable, net		592,625			613,022
Inventory		6,036,033			4,831,461
Prepaid/in-transit inventory		149,541			1,612,686
Prepaid expenses and other current assets		208,373			236,461
Total current assets		8,079,179			7,841,195

Property and equipment		909,603			914,081
Accumulated depreciation		(460,866	)		(430,191	)
Property and equipment, net		448,737			483,890

Other Assets
Operating leases – right-of-use asset		689,046			754,832
Deposits		25,471			27,471
Total other assets		714,517			782,303
Total assets	$	9,242,433		$	9,107,388

Liabilities and stockholders’ equity
Current liabilities
Accounts payable	$	367,457		$	338,091
Customer deposits		41,920			48,474
Accrued expenses and other current liabilities		196,874			187,464
Current portion of operating lease liability		255,676			256,153
Current portion of long-term debt		31,275			31,758
Suspended Liability		4,485,948			4,985,948
Total current liabilities		5,379,150			5,847,888

Long-term debt, net of current portion and discount		190,564			198,412
Operating lease liability, net of current portion		476,115			542,764
Total liabilities	$	6,045,829		$	6,589,064

Stockholders’ equity
Preferred stock, par value $0.001 per share; 20,000,000 shares authorized; 0 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively		—			—
Common stock, par value $0.001 per share; 200,000,000 shares authorized; 3,144,468 and 2,096,082 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively		3,144			2,096
Additional paid-in capital		38,920,698			37,091,468
Accumulated deficit		(35,727,238	)		(34,575,240	)
Total stockholders’ equity		3,196,604			2,518,324
Total liabilities and stockholders’ equity	$	9,242,433		$	9,107,388


EXPION360 INC. STATEMENTS OF OPERATIONS (UNAUDITED)

	For the Three Months Ended March 31,
	2025			2024
Net sales	$	2,049,331		$	971,859
Cost of sales		1,547,764			749,337
Gross profit		501,567			222,522
Selling, general and administrative		1,649,435			2,189,475
Loss from operations		(1,147,868	)		(1,966,953	)

Other (income) / expense:
Interest income		(1	)		(26,865	)
Interest expense		5,668			253,286
(Gain) / Loss on sale of property and equipment		(1,625	)		306
Other (income) / expense		50			(1,200	)
Total other expense		4,092			225,527
Loss before taxes		(1,151,960	)		(2,192,480	)

Franchise taxes		38			460
Net loss	$	(1,151,998	)	$	(2,192,940	)

Net loss per share (basic and diluted)	$	(0.37	)	$	(31.30	)
Weighted-average number of common shares outstanding		3,109,522			70,057


EXPION360 INC. STATEMENTS OF CASH FLOWS (UNAUDITED)

	For the Three Months Ended March 31,
	2025			2024
Cash flows from operating activities

Net loss	$	(1,151,998	)	$	(2,192,940	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation		34,028			49,444
Amortization of convertible note costs		—			166,786
(Gain) / Loss on sale of property and equipment		(1,625	)		306
Stock-based compensation		50,721			315,853

Changes in operating assets and liabilities:
(Increase) / Decrease in accounts receivable		20,397			(83,986	)
(Increase) / Decrease in inventory		(1,204,572	)		44,773
Decrease in prepaid/in-transit inventory		1,463,145			45,137
(Increase) / Decrease in prepaid expenses and other current assets		28,088			(43,753	)
Decrease in deposits		2,000			—
Increase / (Decrease) in accounts payable		29,366			(4,565	)
Decrease in customer deposits		(6,554	)		(6,497	)
Increase in accrued expenses and other current liabilities		9,410			33,669
Increase / (Decrease) in right-of-use assets and lease liabilities		(1,340	)		3,855
Decrease in suspended liability		(500,000	)		—
Net cash used in operating activities		(1,228,934	)		(1,671,918	)

Cash flows from investing activities
Purchases of property and equipment		—			(10,550	)
Net proceeds from sale of property and equipment		2,750			87,684
Net cash provided by investing activities		2,750			77,134

Cash flows from financing activities
Principal payments on convertible note		—			(43,575	)
Principal payments on long-term debt		(8,331	)		(93,855	)
Principal payments on stockholder promissory notes		—			(62,500	)
Net proceeds from exercise of warrants		—			(4	)
Net proceeds from issuance of common stock		1,779,557			125,153
Net cash provided by / (used in) financing activities		1,771,226			(74,781	)

Net change in cash and cash equivalents		545,042			(1,669,565	)
Cash and cash equivalents, beginning		547,565			3,932,698
Cash and cash equivalents, ending		1,092,607			2,263,133

The MIL Network –

May 16, 2025

MIL-OSI: Dragonfly Energy Reports First Quarter 2025 Results

Source: GlobeNewswire (MIL-OSI)

First Quarter Net Sales and Adjusted EBITDA Above Guidance
OEM Net Sales Increased 11% Year-Over-Year
Corporate Optimization Program Enhances Operational Efficiencies
Guides to Second Quarter Net Sales of Approximately $14.8 Million

First Quarter 2025 Financial Highlights
(All comparisons made are against the prior-year period)

Net sales were $13.4 million, compared to $12.5 million, up 6.8%.
OEM net sales were $8.1 million, compared to $7.3 million, up 10.8%.
Gross Margin was 29.4%, compared to 24.4%, up 500 basis points.
Net Loss was $(6.8) million, compared to $(10.4) million.
Adjusted EBITDA was $(3.6) million, compared to $(5.2) million.

RENO, Nev., May 15, 2025 (GLOBE NEWSWIRE) — Dragonfly Energy Holdings Corp. (“Dragonfly Energy” or the “Company”) (Nasdaq: DFLI), an industry leader in energy storage and battery technology, today reported its financial and operational results for the first quarter ended March 31, 2025.

“We are pleased to report a second consecutive quarter of year-over-year revenue growth, driven by demand from OEM customers, demonstrating the strength of our long-term partnerships, proprietary product offerings and compelling value propositions,” commented Dr. Denis Phares, Chief Executive Officer. “While the RV market continues to navigate headwinds, we are seeing encouraging customer adoption trends, along with continued penetration of the large heavy duty trucking market.”

“During the first quarter of 2025, we continued to implement our corporate optimization initiative, prioritizing product development to drive near term revenue and profit. For instance, this strategic shift is accelerating our development of purpose-built solutions for the trucking and industrial markets, resulting in the recent launch of our Battle Born DualFlow Power Pack, a practical, cost-effective hybrid electrification solution for the trucking industry.”

“We have also focused on optimizing our manufacturing efficiency and throughput, enabling us to increase our production capacity without the need for increased headcount,” continued Dr. Phares. “We believe these operational improvements, together with the capital raise completed in February 2025, provide the foundation for our path to revenue growth and profitability.”

First Quarter 2025 Financial and Operating Results
(All financial result comparisons made are against the prior-year period unless otherwise noted)


Net Sales by Customer Type
(in thousands)

	Fiscal Quarter Ended
	March 31, 2025	March 31, 2024	Change (YoY)
OEM	$8,091	$7,302	10.8%
DTC	$5,015	$5,203	-3.6%
Licensing Fee	$250	N/A	N/A
Net Sales	$13,356	$12,505	6.8%

Net Sales increased 6.8% to $13.4 million. OEM net sales grew 10.8% to $8.1 million, driven by increased adoption on new models by existing customers. DTC net sales were $5.0 million compared to $5.2 million, reflecting ongoing macroeconomic pressures.

Gross Profit increased 28.7% to $3.9 million. Gross Margin was 29.4%, up 500 basis points from 24.4%, due to higher volume. Operating Expenses were $9.8 million, compared to $8.9 million. The increase was primarily due to one-time expenses related to patent litigation and the capital raise completed in February 2025.

The Company reported a Net Loss of $(6.8) million, or $(0.93) per diluted share, compared to Net Loss of $(10.4) million or $(1.55) per diluted share. Adjusted EBITDA excluding stock-based compensation, changes in the fair market value of our warrants, and other one-time expenses, was $(3.6) million, compared to $(5.2) million.

Summary and Outlook

“Looking ahead, we believe Dragonfly Energy’s growing U.S.-based production capabilities—including direct control over final assembly—along with our strategic onshoring of select components, will help strengthen our competitive position in today’s volatile tariff environment. In parallel, we are taking steps to mitigate tariff-related impacts by negotiating favorable terms with suppliers and working closely with key customers regarding potential price adjustments. We remain optimistic in our ability to navigate the current macro environment while continuing to execute on our growth initiatives.”

“For the second quarter we anticipate net sales of $14.8 million, representing year-over-year growth of approximately 12%. Our strategic priorities for the year remain focused on driving value through product innovation, revenue diversification, and prudent cost management” Dr. Phares concluded.

Q2 2025 Guidance

Net Sales of approximately $14.8 million
Adjusted EBITDA of approximately $(3.5) million

Webcast Information

The Dragonfly Energy management team will host a conference call to discuss its first quarter 2025 financial and operational this afternoon, May 15, 2025, at 4:30PM Eastern Time. The call can be accessed live via webcast by clicking here, or through the Events and Presentations page within the Investor Relations section of Dragonfly Energy’s website at https://investors.dragonflyenergy.com/events-and-presentations/default.aspx. The call can also be accessed live via telephone by dialing (646) 564-2877, toll-free in North America (800) 549-8228, or for international callers +1 (289) 819-1520, and referencing conference ID: 76172. Please log in to the webcast or dial in to the call at least 10 minutes prior to the start of the event.

An archive of the webcast will be available for a period of time shortly after the call on the Events and Presentations page on the Investor Relations section of Dragonfly Energy’s website, along with the earnings press release.

About Dragonfly Energy

Dragonfly Energy Holdings Corp. (Nasdaq: DFLI) is a comprehensive lithium battery technology company, specializing in cell manufacturing, battery pack assembly, and full system integration. Through its renowned Battle Born Batteries® brand, Dragonfly Energy has established itself as a frontrunner in the lithium battery industry, with hundreds of thousands of reliable battery packs deployed in the field through top-tier OEMs and a diverse retail customer base. At the forefront of domestic lithium battery cell production, Dragonfly Energy’s patented dry electrode manufacturing process can deliver chemistry-agnostic power solutions for a broad spectrum of applications, including energy storage systems, electric vehicles, and consumer electronics. The Company’s overarching mission is the future deployment of its proprietary, nonflammable, all-solid-state battery cells.

To learn more about Dragonfly Energy and its commitment to clean energy advancements, visit https://investors.dragonflyenergy.com/.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that are not historical statements of fact and statements regarding the Company’s intent, belief or expectations, including, but not limited to, statements regarding the Company’s guidance for 2025, results of operations and financial position, planned products and services, business strategy and plans, market size and growth opportunities, competitive position and technological and market trends. Some of these forward-looking statements can be identified by the use of forward-looking words, including “may,” “should,” “expect,” “intend,” “will,” “estimate,” “anticipate,” “believe,” “predict,” “plan,” “targets,” “projects,” “could,” “would,” “continue,” “forecast” or the negatives of these terms or variations of them or similar expressions.

These forward-looking statements are subject to risks, uncertainties, and other factors (some of which are beyond the Company’s control) which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Factors that may impact such forward-looking statements include, but are not limited to: improved recovery in the Company’s core markets, including the RV market; the Company’s ability to successfully increase market penetration into target markets; the Company’s ability to penetrate the heavy-duty trucking and other new markets; the growth of the addressable markets that the Company intends to target; the Company’s ability to retain members of its senior management team and other key personnel; the Company’s ability to maintain relationships with key suppliers including suppliers in China; the Company’s ability to maintain relationships with key customers; the Company’s ability to access capital as and when needed under its $150 million ChEF Equity Facility; the Company’s ability to protect its patents and other intellectual property; the Company’s ability to successfully utilize its patented dry electrode battery manufacturing process and optimize solid state cells as well as to produce commercially viable solid state cells in a timely manner or at all, and to scale to mass production; the Company’s ability to timely achieve the anticipated benefits of its licensing arrangement with Stryten Energy LLC; the Company’s ability to achieve the anticipated benefits of its customer arrangements with THOR Industries and THOR Industries’ affiliated brands (including Keystone RV Company); the Company’s ability to maintain the listing of its common stock and public warrants on the Nasdaq Capital Market; the Russian/Ukrainian conflict; the Company’s ability to generate revenue from future product sales and its ability to achieve and maintain profitability; and the Company’s ability to compete with other manufacturers in the industry and its ability to engage target customers and successfully convert these customers into meaningful orders in the future. These and other risks and uncertainties are described more fully in the sections entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 to be filed with the SEC and in the Company’s subsequent filings with the SEC available at www.sec.gov.

If any of these risks materialize or any of the Company’s assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that the Company presently does not know or that it currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. All forward-looking statements contained in this press release speak only as of the date they were made. Except to the extent required by law, the Company undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made.

Financial Tables


Dragonfly Energy Holdings Corp.
Unaudited Condensed Consolidated Balance Sheets
(U.S. Dollars in thousands, except share and per share data)

	As of
	March 31, 2025			December 31, 2024
Current Assets
Cash and cash equivalents	$	2,803		$	4,849
Accounts receivable, net of allowance for credit losses	4,228			2,416
Inventory	21,728			21,716
Prepaid expenses	932			806
Prepaid inventory	2,031			1,362
Prepaid income tax	311			307
Assets held of sale	644			644
Other current assets	771			825
Total Current Assets	33,448			32,925
Property and Equipment
Property and Equipment, Net	21,252			22,107
Operating lease right of use asset	19,079			19,737
Other assets	445			445
Total Assets	$	74,224		$	75,214
Current Liabilities
Accounts payable	$	13,012		$	10,716
Accrued payroll and other liabilities	4,438			4,129
Accrued tariffs	1,945			1,915
Accrued settlement, current portion	750			750
Customer deposits	137			317
Deferred revenue, current portion	1,000			1,000
Uncertain tax position liability	55			55
Operating lease liability, current portion	2,985			2,926
Financing lease liability, current portion	48			47
Total Current Liabilities	24,370			21,855
Long‑Term Liabilities
Deferred revenue, net of current portion	3,333			3,583
Warrant liabilities	2,011			5,133
Accrued settlement, net of current portion	1,750			1,750
Notes payable, net of debt issuance costs	33,624			29,646
Operating lease liability, net of current portion	21,823			22,588
Financing lease liability, net of current portion	51			63
Total Long‑Term Liabilities	62,592			62,763
Total Liabilities	86,962			84,618
Commitments and Contingencies (See Note 5)
Series A Preferred stock
Preferred stock-Series A 5,000 shares at $0.0001 par value, authorized, 320 and 0 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively	2,907			–
Stockholders’ (Deficit) Equity
Preferred stock, 4,995,000 shares at $0.0001 par value, authorized, no shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively		–			–
Common stock, 250,000,000 shares at $0.0001 par value, authorized, 7,589,642 and 6,695,587 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively	1			1
Additional paid in capital	73,305			72,749
Accumulated deficit	(88,951		)	(82,154		)
Total Stockholders’ (Deficit)	(15,645		)	(9,404		)
Total Liabilities, Series A Preferred Stock and Stockholders’ Deficit	$	74,224		$	75,214

Dragonfly Energy Holdings Corp.
Unaudited Condensed Interim Consolidated Statement of Operations
(U.S. Dollar in Thousands, except share and per share data)
	Three Months Ended
	March 31,			March 31,
		2025			2024

Net Sales	$	13,356		$	12,505

Cost of Goods Sold		9,428			9,454

Gross Profit		3,928			3,051

Operating Expenses
Research and development		1,000			1,333
General and administrative		6,357			4,813
Selling and marketing		2,485			2,744

Total Operating Expenses		9,842			8,890

Loss From Operations		(5,914	)		(5,839	)

Other Income (Expense)
Interest expense		(4,701	)		(4,760	)
Other Expense		–			(4	)
Change in fair market value of warrant liability		3,818			236
Total Other Expense		(883	)		(4,528	)

Net Loss Before Taxes		(6,797	)		(10,367	)

Income Tax (Benefit) Expense		–			–

Net Loss	$	(6,797	)	$	(10,367	)

Net (Loss) Gain Per Share‑ Basic & Diluted	$	(0.93	)	$	(1.55	)
Weighted Average Number of Shares‑ Basic & Diluted		7,327,620			6,695,587

Dragonfly Energy Holdings Corp.
Unaudited Condensed Consolidated Statement of Cash Flows
Three Months Ended
(U.S. in thousands)
		March 31,			March 31,
		2025			2024
Cash flows from Operating Activities
Net Loss	$	(6,797	)	$	(10,367	)
Adjustments to Reconcile Net Loss to Net Cash
Used in Operating Activities
Stock based compensation		220			266
Amortization of debt discount		1,095			894
Change in fair market value of warrant liability		(3,818	)		(236	)
Non‑cash interest expense (paid‑in-kind)		3,579			1,260
Provision for credit losses		103			47
Depreciation and amortization		859			332
Amortization of right of use assets		658			422
Changes in Assets and Liabilities
Accounts receivable		(1,915	)		(655	)
Inventories		(12	)		5,200
Prepaid expenses		(126	)		(71	)
Prepaid inventory		(669	)		(87	)
Other current assets		54			(591	)
Income taxes payable		(4	)		174
Accounts payable and accrued expenses		3,379			81
Operating Lease Liability		(717	)		(181	)
Accrued tariffs		30			87
Deferred revenue		(250	)		–
Customer deposits		(180	)		30
Total Adjustments		2,286			6,972
Net Cash Used in Operating Activities		(4,511	)		(3,395	)

Cash Flows From Investing Activities
Proceeds from disposal of property and equipment	–				–
Purchase of property and equipment		(778	)		(817	)
Net Cash Used in Investing Activities		(778	)		(817	)

(Continued)
Cash Flows From Financing Activities
Proceeds from public offering		63			–
Payment of public offering costs		3,180			–
Proceeds from note payable, related party		–			2,700
Repayment of note payable, related party		–			(2,700	)
Net Cash Provided by Financing Activities		3,243			–

Net Decrease in Cash and cash equivalents		(2,046	)		(4,212	)
Cash and cash equivalents – beginning of period		4,849			12,713
Cash and cash equivalents – end of period	$	2,803		$	8,501

Supplemental Disclosures of Cash Flow Information:
Cash paid for income taxes		2			–
Cash paid for interest	$	1		$	2,390
Supplemental Non‑Cash Items
Purchases of property and equipment, not yet paid	$	929		$	412
Recognition of right of use asset obtained in exchange for operating lease liability	$	–		$	21,095
Conversion of preferred stock to common stock	$	273		$	–
Recognition of warrant liability – Investor Warrants	$	696		$	–

Dragonfly Energy Holdings Corp.
Reconciliation of GAAP to Non-GAAP Measures (Unaudited)
(U.S. Dollars in Thousands)
	Three Months Ended
	March 31,			March 31,
		2025			2024
EBITDA Calculation
Net (Loss) Income Before Taxes	$	(6,797	)	$	(10,367	)
Interest Expense		4,701			4,760
Taxes		–			–
Depreciation and Amortization		859			332
EBITDA	$	(1,237	)	$	(5,275	)

Adjustments to EBITDA
Stock Based Compensation		220			266
Preferred Stock Financing expenses		631
Litigation Fees and Loss on Settlement		543			–
Reverse Stock Split		15			–
Change in fair market value of warrant liability		(3,818	)		(236	)
Adjusted EBITDA	$	(3,645	)	$	(5,245	)

Investor Relations:
Eric Prouty
Szymon Serowiecki
AdvisIRy Partners
DragonflyIR@advisiry.com

The MIL Network –

May 16, 2025

MIL-OSI: Duos Technologies Group Reports First Quarter 2025 Results

Source: GlobeNewswire (MIL-OSI)

JACKSONVILLE, Fla., May 15, 2025 (GLOBE NEWSWIRE) — Duos Technologies Group, Inc. (“Duos” or the “Company”) (Nasdaq: DUOT), a provider of machine vision and artificial intelligence that analyzes fast moving vehicles, reported financial results for the first quarter (“Q1 2025”) ended March 31, 2025.

First Quarter 2025 and Recent Operational Highlights

Recorded over $4.8 million in Services and Consulting revenue including $3.9 million for services related to the Asset Management Agreement (“AMA”) with New APR Energy.
Significant improvement in Gross Margin compared to the same quarter one year ago and further improvements expected in Q2.
Showcased the first production standalone Edge Data Center with revenues starting April 1.
Placed orders for 4 additional data centers for a total of 10 units so far all of which have identified locations and expect to meet goal of 15 deployed units by year end.
Over 2.3 million comprehensive railcar scans performed in the first quarter across 13 portals, of which more than 379,000 were unique railcars. This metric encompasses all railcars scanned at locations across the U.S., Canada, and Mexico, representing approximately 24% of the total freight car population in North America.
As of the end of the first quarter, the Company had $17.8 million of revenue in backlog plus $7.0 – $8.0 million near-term awards and renewals to be recognized during the remainder of 2025.

First Quarter 2025 Financial Results
It should be noted that the following Financial Results represent the consolidation of the Company with its subsidiaries Duos Technologies, Duos Edge AI, Inc., and Duos Energy Corporation (“Duos Energy”).

Total revenues for Q1 2025 increased 363% to $4.95 million compared to $1.07 million in the first quarter of 2024 (“Q1 2024”). Total revenue for Q1 2025 represents an aggregate of approximately $65,000 of technology systems revenue and approximately $4,890,000 in recurring services and consulting revenue. The significant revenue increase in the first quarter, compared to the same quarter last year, was primarily driven by Duos Energy beginning to execute against the Asset Management Agreement (“AMA”) with New APR that was signed on December 31, 2024. Under the AMA, Duos Energy oversees the deployment and operations of a fleet of mobile gas turbines and related balance-of-plant inventory, providing management, sales, and operational support services to New APR. The decrease in technology systems revenues was primarily attributed to delays outside of the Company’s control with deployment of our two high-speed Railcar Inspection Portals. Although these systems remain largely ready for deployment, customer delays at the deployment site continue to prevent the Company from entering the installation phase. In spite of the timing delays that continue to impact the quarterly results, management remains confident in the long-term potential of the RIP product.

Cost of revenues for Q1 2025 increased 273% to $3.64 million compared to $0.98 million for Q1 2024. The significant increase in cost of revenues was primarily due to supporting the AMA with New APR, where Duos Energy oversees the deployment and operations of a fleet of mobile gas turbines and related balance-of-plant inventory, providing management, sales, and operational support services to New APR. An additional contributing factor to the increase in cost of revenues on services and consulting is $548,121 in amortization expense of the intangible asset related to a nonmonetary transaction, which was not present in the corresponding period of 2024. The cost of revenues on technology systems decreased compared to the equivalent period in 2024. This reduction is primarily driven by our ability in Q1 2025 to reallocate certain fixed operating and servicing costs for technology systems to support the AMA, an allocation we could not make in the comparative period because the agreement was not yet in effect. It also reflects the ramp-down of manufacturing ahead of field installation of our two high-speed Railcar Inspection Portals, which has been further delayed and further reduced cost of revenues while we await customer readiness for site deployment.

Gross margin for Q1 2025 increased 1,288% to $1.31 million compared to $0.09 million for Q1 2024. Gross margin improved primarily due to Duos Energy beginning performance of the AMA with New APR. This includes $904,125 in revenue recognized during the three months ended March 31, 2025, related to the Company’s 5% non-voting equity interest in the ultimate parent of New APR, which carried no associated costs and therefore contributed at a 100% margin. These revenues and the associated margin contribution were not present in the prior year period.

Operating expenses for Q1 2025 increased 9% to $3.10 million compared to $2.86 million for Q1 2024. The increase in expenses is largely attributed to non-cash stock-based compensation charged for restricted stock granted to the executive team on January 1, 2025, under new employment agreements with a three-year cliff vesting schedule. Sales and marketing costs declined as resources were allocated to costs of service and consulting revenues in support of the AMA with New APR. Conversely, research and development expenses rose 11%, reflecting new engineering hires dedicated to supporting the AMA. The Company continues to focus on stabilizing operating expenses while meeting the increased needs of our customers.

Net operating loss for Q1 2025 totaled $1.79 million compared to net operating loss of $2.76 million for Q1 2024. The decrease in loss from operations was primarily the result of increased revenues during the quarter, driven by revenue generated by Duos Energy through the AMA with New APR.

Net loss for Q1 2025 totaled $2.08 million compared to net loss of $2.75 million for Q1 2024. The 24% decrease in net loss was mostly attributed to the increase in revenues generated by Duos Energy through the AMA with New APR as described above.

Cash and cash equivalents at March 31, 2025 totaled $3.80 million compared to $6.27 million at December 31, 2024. In addition, the Company had over $2.68 million in receivables and contract assets for a total of approximately $6.48 million in cash and expected short-term liquidity.

Financial Outlook
At the end of the first quarter, the Company’s contracts in backlog represented approximately $45.4 million in revenue, of which approximately $17.4 million is expected to be recognized in calendar 2025 not including an estimated $7.0 – $8.0 million in expected near-term awards and renewals. The remaining contract backlog consists of multi-year service and software agreements, along with project revenues extending beyond 2025, related to Duos, Duos Edge AI, and Duos Energy.

Based on these committed contracts and near-term pending orders that are already performing or scheduled to be executed throughout the course of 2025, the Company is reiterating its previously stated revenue expectations for the fiscal year ending December 31, 2025. The Company expects total revenue for 2025 to range between $28 million and $30 million, representing an increase of 285% to 312% from 2024. Duos expects this improvement in operating results to be reflected over the course of the full year in 2025.

Management Commentary
“I am delighted with the progress we have made in the first quarter and am very impressed at the speed at which the Duos team has adapted to the new opportunities in the Data Center and Power business,” said Chuck Ferry, Duos CEO. “While our Q1 results were anticipated, my expectation is that we will deliver growth, particularly in the second half, as the results of all our initiatives become booked revenues as indicated by the increase in backlog.”

Conference Call
The Company’s management will host a conference call today, May 15, 2025, at 4:30 p.m. Eastern time (1:30 p.m. Pacific time) to discuss these results, followed by a question-and-answer period.

Date: Thursday, May 15, 2025
Time: 4:30 p.m. Eastern time (1:30 p.m. Pacific time)
U.S. dial-in: 877-407-3088
International dial-in: 201-389-0927
Confirmation: 13753649

Please call the conference telephone number 5-10 minutes prior to the start time of the conference call. An operator will register your name and organization.

If you have any difficulty connecting with the conference call, please contact DUOT@duostech.com.

The conference call will be broadcast live via telephone and available for online replay via the investor section of the Company’s website here.

About Duos Technologies Group, Inc.
Duos Technologies Group, Inc. (Nasdaq: DUOT), based in Jacksonville, Florida, through its wholly owned subsidiaries, Duos Technologies, Inc., Duos Edge AI, Inc., and Duos Energy Corporation, designs, develops, deploys and operates intelligent technology solutions for Machine Vision and Artificial Intelligence (“AI”) applications including real-time analysis of fast-moving vehicles, Edge Data Centers and power consulting. For more information, visit www.duostech.com , www.duosedge.ai and www.duosenergycorp.com.

Forward- Looking Statements
This news release includes forward-looking statements regarding the Company’s financial results and estimates and business prospects that involve substantial risks and uncertainties that could cause actual results to differ materially. Forward-looking statements relate to future events and typically address the Company’s expected future business and financial performance. The forward-looking statements in this news release relate to, among other things, information regarding anticipated timing for the installation, development and delivery dates of our systems; anticipated entry into additional contracts; anticipated effects of macro-economic factors (including effects relating to supply chain disruptions and inflation); timing with respect to revenue recognition; trends in the rate at which our costs increase relative to increases in our revenue; anticipated reductions in costs due to changes in the Company’s organizational structure; potential increases in revenue, including increases in recurring revenue; potential changes in gross margin (including the timing thereof); statements regarding our backlog and potential revenues deriving therefrom; and statements about future profitability and potential growth of the Company. Words such as “believe,” “expect,” “anticipate,” “should,” “plan,” “aim,” “will,” “may,” “should,” “could,” “intend,” “estimate,” “project,” “forecast,” “target,” “potential” and other words and terms of similar meaning, typically identify such forward-looking statements. Forward-looking statements involve risks and uncertainties and there are important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements. These factors include, but are not limited to, the Company’s ability to generate sufficient cash to continue and expand operations, the competitive environment generally and in the Company’s specific market areas, changes in technology, the availability of and the terms of financing, changes in costs and availability of goods and services, economic conditions in general and in the Company’s specific market areas, changes in federal, state and/or local government laws and regulations potentially affecting the use of the Company’s technology, changes in operating strategy or development plans and the ability to attract and retain qualified personnel. The Company cautions that the foregoing list of risks, uncertainties and factors is not exclusive. Additional information concerning these and other risk factors is contained in the Company’s most recently filed Annual Reports on Form 10-K, subsequent Quarterly Reports on Form 10-Q, recent Current Reports on Form 8-K, and other filings filed by the Company with the U.S. Securities and Exchange Commission (the “SEC”), which are available at the SEC’s website, http://www.sec.gov. The Company believes its plans, intentions and expectations reflected in or suggested by these forward-looking statements are based on reasonable assumptions. No assurance, however, can be given that the Company will achieve or realize these plans, intentions or expectations. Indeed, it is likely that some of the Company’s assumptions may prove to be incorrect. The Company’s actual results and financial position may vary from those projected or implied in the forward-looking statements and the variances may be material. Each forward-looking statement speaks only as of the date of the particular statement. We do not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in our expectations or any change in events, conditions or circumstances on which any forward-looking statement is based, except as required by law. All subsequent written and oral forward-looking statements concerning the Company or other matters attributable to the Company or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements above.


DUOS TECHNOLOGIES GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

		For the Three Months Ended
		March 31,
			2025			2024

REVENUES:
	Technology systems	$	64,684		$	269,855
	Services and consulting		972,751			800,825
	Services and consulting – related parties		3,914,750			–

	Total Revenues		4,952,185			1,070,680

COST OF REVENUES:
	Technology systems		232,264			583,437
	Services and consulting		748,194			392,611
	Services and consulting – related parties		2,658,068			–

	Total Cost of Revenues		3,638,526			976,048

GROSS MARGIN			1,313,659			94,632

OPERATING EXPENSES:
	Sales and marketing		294,975			553,486
	Research and development		424,431			382,142
	General and administration		2,383,881			1,920,050

	Total Operating Expenses		3,103,287			2,855,678

LOSS FROM OPERATIONS			(1,789,628	)		(2,761,046	)

OTHER INCOME (EXPENSES):
Interest expense			(322,577	)		(445	)
Other income, net			32,542			9,182

	Total Other Income (Expenses), net		(290,035	)		8,737

NET LOSS		$	(2,079,663	)	$	(2,752,309	)


Basic and Diluted Net Loss Per Share		$	(0.18	)	$	(0.38	)


Weighted Average Shares-Basic and Diluted			11,390,016			7,306,949

DUOS TECHNOLOGIES GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS

		March 31,			December 31,
			2025			2024
		(Unaudited)
ASSETS
CURRENT ASSETS:
	Cash	$	3,799,281		$	6,266,296
	Accounts receivable, net		215,060			109,007
	Accounts receivable, net – related parties		1,760,625			294,434
	Contract assets		700,458			635,774
	Inventory		520,122			605,356
	Prepaid expenses and other current assets		468,252			176,338
	Note receivable, net		–			–

	Total Current Assets		7,463,798			8,087,205

	Inventory – non current		196,315			196,315
	Property and equipment, net		3,300,754			2,771,779
	Operating lease right of use asset – Office Lease		3,937,256			4,028,397
	Financing lease right of use asset – Edge Data Centers		1,943,547			2,019,180
	Security deposit		500,000			500,000

OTHER ASSETS:
	Equity Method Investment – Sawgrass APR Holdings LLC		7,233,000			7,233,000
	Intangible Asset, net		9,043,996			9,592,118
	Patents and trademarks, net		133,714			127,300
	Software development costs, net		334,960			403,383
	Total Other Assets		16,745,670			17,355,801

TOTAL ASSETS		$	34,087,340		$	34,958,677

LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES:
	Accounts payable	$	698,518		$	969,822
	Notes payable – financing agreements		129,914			17,072
	Accrued expenses		451,130			373,251
	Operating lease obligation – Office Lease -current portion		803,536			798,556
	Financing lease obligations – Edge Data Centers – current portion		487,695			367,451
	Notes payable, net of discount – related parties		1,027,707			1,758,396
	Contract liabilities, current		3,001,352			3,188,518
	Contract liabilities, current – related parties		7,366,500			8,616,500

	Total Current Liabilities		13,966,352			16,089,566

	Contract liabilities, less current portion		6,851,513			7,399,634
	Contract liabilities, less current portion – related parties		2,712,375			3,616,500
	Operating lease obligation – Office Lease, less current portion		3,767,106			3,867,042
	Financing lease obligations – Edge Data Centers, less current portion		1,638,040			1,724,604

	Total Liabilities		28,935,386			32,697,346

Commitments and Contingencies (Note 8)

STOCKHOLDERS’ EQUITY:
	Preferred stock: $0.001 par value, 10,000,000 authorized, 9,441,000 shares available to be designated
	Series A redeemable convertible preferred stock, $10 stated value per share,		–			–
	500,000 shares designated; 0 and 0 issued and outstanding at March 31, 2025 and December 31, 2024, respectively,
	convertible into common stock at $6.30 per share
	Series B convertible preferred stock, $1,000 stated value per share,		–			–
	15,000 shares designated; 0 and 0 issued and outstanding at March 31, 2025
	and December 31, 2024, respectively, convertible into common stock at $7 per share
	Series C convertible preferred stock, $1,000 stated value per share,		–			–
	5,000 shares designated; 0 and 0 issued
	and outstanding at March 31, 2025 and December 31, 2024, respectively,
	convertible into common stock at $5.50 per share
	Series D convertible preferred stock, $1,000 stated value per share,		1			1
	4,000 shares designated; 999 and 1,299 issued
	and outstanding at March 31, 2025 and December 31, 2024, respectively,
	convertible into common stock at $3.00 per share
	Series E convertible preferred stock, $1,000 stated value per share,
	30,000 shares designated; 13,500 and 13,500 issued
	and outstanding at March 31, 2025 and December 31, 2024, respectively,		14			14
	convertible into common stock at $2.61 per share
	Series F convertible preferred stock, $1,000 stated value per share,
	5,000 shares designated; 0 and 0 issued
	and outstanding at March 31, 2025 and December 31, 2024, respectively,		–			–
	convertible into common stock at $6.20 per share

	Common stock: $0.001 par value; 500,000,000 shares authorized,
	11,655,229 and 8,922,576 shares issued, 11,653,905 and 8,921,252		11,654			8,921
	shares outstanding at March 31, 2025 and December 31, 2024, respectively
	Additional paid-in-capital		81,745,409			76,777,856
	Accumulated deficit		(76,447,672	)		(74,368,009	)
	Sub-total		5,309,406			2,418,783
	Less: Treasury stock (1,324 shares of common stock
	at March 31, 2025 and December 31, 2024)		(157,452	)		(157,452	)
Total Stockholders’ Equity			5,151,954			2,261,331

Total Liabilities and Stockholders’ Equity		$	34,087,340		$	34,958,677

DUOS TECHNOLOGIES GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

	For the Three Months Ended
	March 31,
		2025			2024

Cash from operating activities:
Net loss	$	(2,079,663	)	$	(2,752,309	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		712,388			158,208
Inventory write-off		25,000			–
Stock based compensation		995,647			159,320
Stock issued for services		50,000			37,500
Amortization of debt discount related to warrant liabilities		269,311			–
Amortization of operating lease right of use asset – Office Lease		91,142			83,348
Amortization of lease right of use asset – Edge Data Centers		75,633			–
Changes in assets and liabilities:
Accounts receivable		(106,053	)		866,373
Accounts receivable-related parties		(1,466,191	)		–
Note receivable		–			(1,875	)
Contract assets		(64,684	)		(270,099	)
Inventory		10,624			23,828
Prepaid expenses and other current assets		(42,467	)		57,944
Accounts payable		(271,304	)		(415,718	)
Accrued expenses		77,879			76,370
Operating lease obligation – Office Lease		(94,956	)		(82,306	)
Lease obligations – Edge Data Centers		33,680			–
Contract liabilities		(2,889,411	)		26,697

Net cash used in operating activities		(4,673,425	)		(2,032,719	)

Cash flows from investing activities:
Purchase of patents/trademarks		(9,264	)		(980	)
Purchase of fixed assets		(572,359	)		(8,830	)

Net cash used in investing activities		(581,623	)		(9,810	)

Cash flows from financing activities:
Repayments on financing agreements		(136,606	)		(130,535	)
Repayments of notes payable, related parties		(1,000,000	)		–
Proceeds from common stock issued		3,954,940			–
Proceeds from excercise of stock options		107,925			–
Stock issuance cost		(138,226	)		(36,188	)
Proceeds from preferred stock issued		–			2,745,002

Net cash provided by financing activities		2,788,033			2,578,279

Net increase (decrease) in cash		(2,467,015	)		535,750
Cash, beginning of period		6,266,296			2,441,842
Cash, end of period	$	3,799,281		$	2,977,592

Supplemental Disclosure of Cash Flow Information:
Interest paid	$	3,865		$	–
Taxes paid	$	15,945		$	–

Supplemental Non-Cash Investing and Financing Activities:
Notes issued for financing of insurance premiums	$	249,448		$	272,322
Transfer of inventory to fixed assets	$	49,609		$	–

A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/9b5abe56-f21b-4ee5-9a09-7f9852d9bd2b

This press release was published by a CLEAR® Verified individual.

The MIL Network –

May 16, 2025

MIL-OSI: Fluent Announces First Quarter 2025 Financial Results; Strategic Pivot Accelerates with Growth of Commerce Media Solutions

Source: GlobeNewswire (MIL-OSI)

Revenue of $55.2 million for Q1 2025
Q1 2025 Commerce Media Solutions revenue grew 99% to $12.7 million representing 23% of consolidated revenue from $6.4 million or 10% of consolidated revenue in Q1 2024 with gross profit margin (exclusive of depreciation and amortization) of 22% in Q1 2025 compared to 21% for the consolidated business
Commerce Media Solutions annual revenue run rate now exceeds $65 million, reflecting an 8% quarter-over-quarter increase and strong momentum in executing the Company’s strategic pivot to this higher growth market
Subsequent to the first quarter, the Company announced a strategic partnership with Rebuy Engine to launch Rebuy Ads powered by Fluent, providing post-purchase advertising for Shopify merchants

NEW YORK, May 15, 2025 (GLOBE NEWSWIRE) — Fluent, Inc. (NASDAQ: FLNT), a commerce media solutions provider, today reported unaudited financial results for the first quarter ended March 31, 2025.

Don Patrick, Fluent’s Chief Executive Officer, commented, “Our first quarter results showed the fifth consecutive quarter of strong year-over-year growth in our Commerce Media Solutions business. As we continue to execute on our strategic pivot to focus on what we see as a core, long-term growth opportunity in the commerce media marketplace, this segment has been the foundational driver of our evolving model, achieving nearly triple-digit year-over-year growth since its launch in early 2023. Underscoring our growth are the impressive partnerships with top-tier media partners and advertisers across a diverse range of market verticals. After the close of the first quarter we announced a breakthrough partnership with Rebuy Engine, a leading ecommerce personalization platform for Shopify brands. With the combined expertise of both companies, Rebuy Ads powered by Fluent is set to redefine how Shopify merchants engage with performance-driven advertising.”

Mr. Patrick continued, “While Commerce Media Solutions is performing exceptionally well, we experienced some additional attrition in our Owned and Operated business primarily due to a reduction in media supply, particularly from social media. This trend has continued into the second quarter. To address this, we’re actively expanding our supply channels to mitigate long-term impacts. Importantly, as we continue efforts to stabilize this cash-flow positive Owned and Operated business, it remains a productive driver of our Commerce Media Solutions growth strategy. With the growth of our Commerce Media Solutions business and shifting revenue mix, we anticipate consolidated second quarter revenue to remain in line with the first quarter of 2025.”

“Overall, we’re encouraged by our progress in the quarter, and with our visibility today, we expect to continue driving meaningful growth in our Commerce Media Solutions business through 2025 as we build a more predictable and valuable business for our shareholders,” Mr. Patrick concluded.

First Quarter Financial Highlights

Revenue of $55.2 million, a decrease of 16%, compared to $66.0 million in Q1 2024
- Owned and Operated revenue decreased 30% to $31.1 million compared to $44.7 million in Q1 2024 as the Company continued its shift in focus and revenue mix to higher margin Commerce Media Solutions
- Commerce Media Solutions revenue increased 99% to $12.7 million compared to $6.4 million in Q1 2024
Net loss of $8.3 million, or $0.39 per share, compared to a net loss of $6.3 million, or $0.45 per share, for Q1 2024.
Gross profit (exclusive of depreciation and amortization) of $11.4 million, a decrease of 39% over Q1 2024 and representing 21% of revenue. The Company’s growing Commerce Media Solutions business reported gross profit (exclusive of depreciation and amortization) of $2.8 million, an increase of 54% over Q1 2024 and representing 22% of revenue for Q1 2025.
Media margin of $13.7 million, a decrease of 38% over Q1 2024 and representing 24.9% of revenue. The Company’s growing Commerce Media Solutions business reported media margin of $3.1 million, an increase of 56% over Q1 2024 and representing 24.6% for if revenue for Q1 2025.
Adjusted EBITDA of negative $3.1 million, a decrease of $3.7 million compared to Q1 2024 and representing 5.6% of revenue
Adjusted net loss of $6.7 million, or $0.31 per share, compared to $4.2 million, or $0.30 per share, for Q1 2024

Business Outlook & Goals

Further establish Fluent’s Commerce Media Solutions business as a leader in the performance marketing sector among both media partners and advertisers to capitalize on the growing demand for this advertising channel across numerous high-volume market verticals.
Drive revenue growth, improvement in net loss as compared to 2024, and positive adjusted EBITDA for full-year 2025 supported by the growth of Fluent’s Commerce Media Solutions. These improvements are expected to occur in the second half of 2025 as Commerce Media Solutions continues to scale as a percentage of consolidated revenue.
Leverage 14-year leadership position at the forefront of customer acquisition and robust database of first-party user data to differentiate Fluent from competitors in the commerce media space.

Conference Call

Fluent, Inc. will host a conference call on Thursday, May 15, 2025, at 4:30 PM ET to discuss its 2025 first quarter financial results. The conference call can be accessed by phone after registering online at https://register-conf.media-server.com/register/BI2c18ceec43da4e809374edc6b958fefe. The call will also be webcast simultaneously on the Fluent website at https://investors.fluentco.com/. Following the completion of the earnings call, a recorded replay of the webcast will be available for those unable to participate. To listen to the telephone replay, please connect via https://edge.media-server.com/mmc/p/qsf7a838. The replay will be available for one year, via the Fluent website https://investors.fluentco.com.

About Fluent, Inc.

Fluent, Inc. (NASDAQ: FLNT) is a commerce media solutions provider connecting top-tier brands with highly engaged consumers. Leveraging exclusive ad inventory, robust first-party data, and proprietary machine learning, Fluent unlocks additional revenue streams for partners and empowers advertisers to acquire their most valuable customers at scale. Founded in 2010, Fluent uses its deep expertise in performance marketing to drive monetization and increase engagement at key touchpoints across the customer journey. For more insights visit http://www.fluentco.com/.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995

The matters contained in this press release may be considered to be “forward-looking statements” within the meaning of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. Such statements include statements regarding the intent, belief or current expectations or anticipations of Fluent and members of our management team. Factors currently known to management that could cause actual results to differ materially from those in forward-looking statements include the following:

	•	Compliance with the covenants of our credit agreement in light of current business conditions, the current uncertainty of which raises substantial doubt about our ability to continue as a going concern;
	•	Ability to operate in a competitive, rapidly changing and highly regulated industry, which makes it difficult to evaluate our business and prospects
	•	Dependence on the gaming industry;
	•	Unfavorable publicity and negative public perception about the digital marketing industry or us;
	•	A sudden reduction in online marketing spend by our clients, a loss of clients or lower advertising yields;
	•	Credit risk from certain clients
	•	Our relative inexperience in the post-transaction commerce media business, which is currently dominated by a major player;
	•	Our need to continue investing in technology for our Commerce Media Solutions business;
	•	Our competitive disadvantage because we are more selective in our traffic sources;
	•	A decline in the supply of media available to us through third parties or an increase in the price of such media;
	•	Ability to remain competitive with the shift to mobile applications and our use of CRM;
	•	Our increasing reliance upon inbound calls, particularly in the health plan vertical, which we may be unable to obtain cost effectively obtain in the future;
	•	Difficulty managing any future growth or scaling our infrastructure and products quickly enough to meet the needs of our business while maintaining profitability;
	•	Global economic or political instability, including the potential impact of tariffs on our business;
	•	Challenges managing the growth of our operations, including international expansion and the integration of acquired business units or personnel;
	•	Strategic alternatives that could complicate operations or divert management’s attention;
	•	Dependence on our key personnel and ability to attract or retain employees;
	•	Dependence upon third-party service providers and potential liability related to their actions or platform malfunctions;
	•	Compliance with a significant number of governmental laws and regulations, including those regarding telemarketing, email marketing, text messaging, privacy, and data protection;
	•	The outcome of litigation, inquiries, investigations, examinations, or other legal proceedings in which we are or may become involved, or in which our clients or competitors are involved;
	•	Potential sales and use taxes and other taxes on our business;
	•	Our actual or perceived failure to safeguard any personal information or user privacy;
	•	Failure to adequately protect intellectual property rights or allegations of infringement of intellectual property rights;
	•	Potential liability or expenses for legal claims based on the nature and content of the materials we create or distribute, including those provided by third parties, as a creator and a distributor of digital media content;
	•	Our need to raise capital to fund our operations;
	•	Our ability to maintain listing of our securities on The Nasdaq Capital Market;
	•	The volatility of our stock price and concentration of stock ownership;
	•	Potential dilutive effect of any future issuances of shares of our common stock;
	•	Lack of cash dividends for the foreseeable future;
	•	Status of a smaller reporting company and non-accelerated filer, which involves certain reduced governance and disclosure requirements; and
	•	Uncertainty in the acceptance by Shopify merchants of Rebuy Ads powered by Fluent.

These and additional factors to be considered are set forth under “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 and in our other filings with the Securities and Exchange Commission. Fluent undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results or expectations, except as required by law.

FLUENT, INC. CONSOLIDATED BALANCE SHEETS (Amounts in thousands, except share and per share data) (unaudited)

	March 31, 2025			December 31, 2024
ASSETS:
Cash and cash equivalents	$	4,828		$	9,439
Accounts receivable, net of allowance for credit losses of $483 and $487, respectively		37,019			46,532
Prepaid expenses and other current assets		8,126			8,729
Restricted cash		1,255			1,255
Total current assets		51,228			65,955
Property and equipment, net		233			304
Operating lease right-of-use assets		1,118			1,570
Intangible assets, net		20,986			21,797
Other non-current assets		3,929			3,991
Total assets	$	77,494		$	93,617
LIABILITIES AND SHAREHOLDERS’ EQUITY:
Accounts payable	$	8,513		$	8,776
Accrued expenses and other current liabilities		19,694			21,905
Deferred revenue		341			556
Current portion of long-term debt		21,801			31,609
Current portion of operating lease liability		1,310			1,836
Total current liabilities		51,659			64,682
Long-term debt, net		—			250
Convertible Notes, at fair value with related parties		3,800			3,720
Operating lease liability, net		—			9
Other non-current liabilities		—			1
Total liabilities		55,459			68,662
Contingencies
Shareholders’ equity:
Preferred stock — $0.0001 par value, 10,000,000 Shares authorized; Shares outstanding — 0 shares for both periods		—			—
Common stock — $0.0005 par value, 200,000,000 Shares authorized; Shares issued — 21,412,255 and 20,791,431, respectively; and Shares outstanding — 20,643,660 and 20,022,836, respectively		47			47
Treasury stock, at cost — 768,595 and 768,595 Shares, respectively		(11,407	)		(11,407	)
Additional paid-in capital		452,459			447,110
Accumulated deficit		(419,064	)		(410,795	)
Total shareholders’ equity		22,035			24,955
Total liabilities and shareholders’ equity	$	77,494		$	93,617

FLUENT, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Amounts in thousands, except share and per share data) (unaudited)

	Three Months Ended March 31,
	2025			2024
Revenue	$	55,210		$	65,983
Costs and expenses:
Cost of revenue (exclusive of depreciation and amortization)		43,775			47,348
Sales and marketing		4,070			4,812
Product development		3,398			4,840
General and administrative		8,582			10,365
Depreciation and amortization		2,461			2,571
Total costs and expenses		62,286			69,936
Loss from operations		(7,076	)		(3,953	)
Interest expense, net		(880	)		(1,415	)
Fair value adjustment of Convertible Notes with related parties		(80	)		—
Loss before income taxes		(8,036	)		(5,368	)
Income tax expense		(233	)		(908	)
Net loss	$	(8,269	)	$	(6,276	)

Basic and diluted loss per share:
Basic	$	(0.39	)	$	(0.45	)
Diluted	$	(0.39	)	$	(0.45	)

Weighted average number of shares outstanding:
Basic		21,211,439			13,902,165
Diluted		21,211,439			13,902,165

FLUENT, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Amounts in thousands) (unaudited)

	Three Months Ended March 31,
	2025			2024
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(8,269	)	$	(6,276	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		2,461			2,571
Non-cash loan amortization expense		176			711
Share-based compensation expense		335			600
Fair value adjustment of Convertible Notes with related parties		80			—
Allowance for credit losses		(4	)		82
Changes in assets and liabilities, net of business acquisitions:
Accounts receivable		9,517			3,028
Prepaid expenses and other current assets		603			(266	)
Other non-current assets		106			100
Operating lease assets and liabilities, net		(83	)		(85	)
Accounts payable		(263	)		(2,125	)
Accrued expenses and other current liabilities		(2,331	)		2,344
Deferred revenue		(215	)		131
Other		(1	)		(947	)
Net cash provided by (used in) operating activities		2,112			(132	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Capitalized costs included in intangible assets		(1,570	)		(1,796	)
Net cash used in investing activities		(1,570	)		(1,796	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of long-term debt, net of debt financing costs		21,841			—
Repayments of long-term debt		(31,869	)		(1,250	)
Debt financing costs		(125	)		(968	)
Proceeds from issuance of pre-funded warrants		5,000			—
Net cash used in financing activities		(5,153	)		(2,218	)
Net decrease in cash, cash equivalents, and restricted cash		(4,611	)		(4,146	)
Cash, cash equivalents, and restricted cash at beginning of period		10,694			15,804
Cash, cash equivalents, and restricted cash at end of period	$	6,083		$	11,658

Definitions, Reconciliations and Uses of Non-GAAP Financial Measures

The following non-GAAP measures are used in this release:

Media margin is defined as that portion of gross profit (exclusive of depreciation and amortization) reflecting variable costs paid for media and related expenses and excluding non-media cost of revenue. Gross profit (exclusive of depreciation and amortization) represents revenue minus cost of revenue (exclusive of depreciation and amortization). Media margin is also presented as a percentage of revenue.

Adjusted EBITDA is defined as net income (loss), excluding (1) income taxes, (2) interest expense, net, (3) depreciation and amortization, (4) share-based compensation expense, (5) loss on early extinguishment of debt, (6) accrued compensation expense for put/call consideration, (7) goodwill impairment, (8) impairment of intangible assets, (9) loss (gain) on disposal of property and equipment, (10) fair value adjustment of Convertible Notes with related parties, (11) acquisition-related costs, (12) restructuring and other severance costs, and (13) certain litigation and other related costs.

Adjusted net income is defined as net income (loss) excluding (1) share-based compensation expense, (2) loss on early extinguishment of debt, (3) accrued compensation expense for put/call consideration, (4) goodwill impairment, (5) impairment of intangible assets, (6) loss (gain) on disposal of property and equipment, (7) fair value adjustment of Convertible Notes with related parties (8) acquisition-related costs, (9) restructuring and other severance costs, and (10) certain litigation and other related costs. Adjusted net income is also presented on a per share (basic and diluted) basis.

Below is a reconciliation of media margin from gross profit (exclusive of depreciation and amortization), which we believe is the most directly comparable U.S. GAAP measure.

	Three Months Ended March 31,
(In thousands, except percentages)	2025			2024
Revenue	$	55,210		$	65,983
Less: Cost of revenue (exclusive of depreciation and amortization)		43,775			47,348
Gross profit (exclusive of depreciation and amortization)	$	11,435		$	18,635
Gross profit (exclusive of depreciation and amortization) % of revenue		21	%		28	%
Non-media cost of revenue ⁽¹⁾		2,296			3,504
Media margin	$	13,731		$	22,139
Media margin % of revenue		24.9	%		33.6	%

(1) Represents the portion of cost of revenue (exclusive of depreciation and amortization) not attributable to variable costs paid for media and related expenses.

Below is a reconciliation of media margin from gross profit (exclusive of depreciation and amortization), which we believe is the most directly comparable U.S. GAAP measure, for Commerce Media Solutions.

	Three Months Ended March 31,
(In thousands, except percentages)	2025			2024
Revenue	$	12,660		$	6,376
Less: Cost of revenue (exclusive of depreciation and amortization)		9,847			4,553
Gross profit (exclusive of depreciation and amortization)	$	2,813		$	1,823
Gross profit (exclusive of depreciation and amortization) % of revenue		22	%		29	%
Non-media cost of revenue ⁽¹⁾		298			175
Media margin	$	3,111		$	1,998
Media margin % of revenue		24.6	%		31.3	%

(1) Represents the portion of cost of revenue (exclusive of depreciation and amortization) not attributable to variable costs paid for media and related expenses.

Below is a reconciliation of adjusted EBITDA from net loss, which we believe is the most directly comparable U.S. GAAP measure.

	Three Months Ended March 31,
(In thousands)	2025			2024
Net loss	$	(8,269	)	$	(6,276	)
Income tax expense		233			908
Interest expense, net		880			1,415
Depreciation and amortization		2,461			2,571
Share-based compensation expense		335			600
Fair value adjustment of Convertible Notes with related parties		80			—
Acquisition-related costs⁽¹⁾		(119	)		782
Restructuring and other severance costs		1,315			665
Adjusted EBITDA	$	(3,084	)	$	665

(1	)	Balance includes compensation expense related to non-compete agreements and earn-out expense incurred as a result of business combinations. The earn-out expense was ($119) and $151 for the three months ended March 31, 2025 and 2024, respectively.

Below is a reconciliation of adjusted net income and the related measure of adjusted net income per share from net income (loss), which we believe is the most directly comparable U.S. GAAP measure.

	Three Months Ended March 31,
(In thousands, except share and per share data)	2025			2024
Net loss	$	(8,269	)	$	(6,276	)
Share-based compensation expense		335			600
Fair value adjustment of Convertible Notes with related parties		80			—
Acquisition-related costs⁽¹⁾		(119	)		782
Restructuring and other severance costs		1,315			665
Adjusted net loss	$	(6,658	)	$	(4,229	)
Adjusted net loss per share:
Basic	$	(0.31	)	$	(0.30	)
Diluted	$	(0.31	)	$	(0.30	)
Weighted average number of shares outstanding:
Basic		21,211,439			13,902,165
Diluted		21,211,439			13,902,165

(1	)	Balance includes compensation expense related to non-compete agreements and earn-out expense incurred as a result of business combinations. The earn-out expense was ($119) and $151 for the three months ended March 31, 2025 and 2024, respectively.

We present media margin, adjusted EBITDA, and adjusted net income as supplemental measures of our financial and operating performance because we believe they provide useful information to investors. More specifically:

Media margin, as defined above, is a measure of the efficiency of the Company’s operating model. We use media margin and the related measure of media margin as a percentage of revenue as primary metrics to measure the financial return on our media and related costs, specifically to measure the degree by which the revenue generated from our digital marketing services exceeds the cost to attract the consumers to whom offers are made through our services. Media margin is used extensively by our management to manage our operating performance, including evaluating operational performance against budgeted media margin and understanding the efficiency of our media and related expenditures. We also use media margin for performance evaluations and compensation decisions regarding certain personnel.

Adjusted EBITDA, as defined above, is another primary metric by which we evaluate the operating performance of our business, on which certain operating expenditures and internal budgets are based and by which, in addition to media margin and other factors, our senior management is compensated. The first three adjustments represent the conventional definition of EBITDA, and the remaining adjustments are items recognized and recorded under U.S. GAAP in particular periods but might be viewed as not necessarily coinciding with the underlying business operations for the periods in which they are so recognized and recorded. These adjustments include certain litigation and other related costs associated with legal matters outside the ordinary course of business. We consider items one-time in nature if they are non-recurring, infrequent or unusual and have not occurred in the past two years or are not expected to recur in the next two years, in accordance with SEC rules. There were no adjustments for one-time items in the periods presented.

Adjusted net income, as defined above, excludes certain items that are recognized and recorded under U.S. GAAP in particular periods but might be viewed as not necessarily coinciding with the underlying business operations for the periods in which they are so recognized and recorded. We believe adjusted net income affords investors a different view of the overall financial performance of the Company than adjusted EBITDA and the U.S. GAAP measure of net (loss) income.

Media margin, adjusted EBITDA, adjusted net income, and adjusted net income per share are non-GAAP financial measures with certain limitations regarding their usefulness. They do not reflect our financial results in accordance with U.S. GAAP, as they do not include the impact of certain expenses that are reflected in our condensed consolidated statements of operations. Accordingly, these metrics are not indicative of our overall results or indicators of past or future financial performance. Further, they are not financial measures of profitability and are neither intended to be used as a proxy for the profitability of our business nor to imply profitability. The way we measure media margin, adjusted EBITDA, and adjusted net income may not be comparable to similarly titled measures presented by other companies and may not be identical to corresponding measures used in our various agreements.

Annual Revenue Run Rate

Annual Revenue Run Rate is an operational metric that represents the annualized revenue of the Company’s media partnerships at current monetization levels, as of the end of the reporting period. The Company calculates Annual Revenue Run Rate as follows:

Media partners within Commerce Media Solutions with an active contract are assessed and assigned an annual media volume estimate based on the active term of the contract and the monetization rate at the end of the reporting period. The Company considers a media partner contract to be active when the contractual term commences (the “start date”) until its right to serve the partner’s commerce traffic ends. Even if the contract with the customer is executed before the start date, the contract will not count toward Annual Revenue Run Rate until the media partner’s right to receive the benefit of the services has commenced.
As Annual Revenue Run Rate includes only contracts that are active at the end of the reporting period, it does not reflect assumptions or estimates regarding new business. For contracts expiring within 12 months of the period-end calculation date, Annual Revenue Run Rate does reflect expectations of renewal.
The Company’s Commerce Media Solutions platform provides the technology to effectively monetize the partner’s media by placing relevant ads at a contracted moment of consumer engagement. Although from inception to date, improvements in the platform’s AI-powered technology have consistently driven increased rates of monetization, for the purpose of Annual Revenue Run Rate, the Company assumes a consistent monetization level to that as measured on each media partner at the end of the reporting period.

The way the Company measures Annual Revenue Run Rate may not be comparable to similarly titled measures presented by other companies and should not be viewed as a projection of future revenue.

Contact Information:
Investor Relations
Fluent, Inc.
InvestorRelations@fluentco.com

The MIL Network –

May 16, 2025

MIL-OSI: BIO-key Reports Q1’25 Revenue of $1.6M and Improved Cash Position of $3.1M; Hosts Investor Call Tomorrow, Friday May 16th at 10am ET

Source: GlobeNewswire (MIL-OSI)

HOLMDEL, N.J., May 15, 2025 (GLOBE NEWSWIRE) — BIO-key ® International, Inc. (Nasdaq: BKYI), an innovative provider of workforce and customer Identity and Access Management (IAM) solutions featuring passwordless, phoneless and tokenless Identity-Bound Biometric (IBB) authentication, announced results for its first quarter (Q1’25). BIO-key will host an investor call tomorrow, Friday, May 16th at 10:00am ET (details below).

BIO-key CEO, Mike DePasquale commented, “Our revenue rose approximately 10% sequentially vs. Q4’24, as we continue our transition to selling high-margin BIO-key branded products in Europe, the Middle East and Africa (EMEA). Year-over-year revenue decreased 25% due to a $1.2M two-year contract with a long-term financial services customer we closed in Q1’24, as compared to $690k recorded in Q1’25 from the customer’s addition of incremental biometric capabilities. We expect revenue from this customer to increase significantly in the next two-year period commencing in 2026, due to their expanding deployment and the addition of our one-to-many fingerprint-only biometric ID system that requires no card or account number for client Identification.

“Our gross margin remained healthy in Q1 at 83%, and we reduced our selling, general and administrative expense by 23% year-over-year. Our cash position increased substantially to $3.1M reflecting proceeds from warrant exercises early in Q1’25. Since December 31, we have also reduced the principal balance on our outstanding note payable. These balance sheet improvements provide solid footing for BIO-key as we pursue new growth opportunities.”

Q1 Highlights

Mr. DePasquale continued, “Moving forward, we are seeing growing traction for our identity bound biometric solutions in defense/security and financial services applications that require the highest levels of security. In these use cases, our customers are drawn to our unique ability to authenticate the individual seeking data or network access rather than alternate factors that are far more prone to being compromised. We now support secure biometric authentication for a number of national and international defense and police organizations and are working to leverage these powerful endorsements in our business development efforts.

“We continue to build our base of government and government related customers who appreciate the flexibility, ease of use and ability to support multiple authentication factors that create a compelling return on investment profile. We see growing interest in our unique passwordless, phoneless and tokenless authentication solutions, which meet the most pressing security and usability challenges.

“We have built a solid presence in state, local and educational (SLED) markets domestically, as we now serve over 100 institutions with over 4M end users. In Q1’25 the Wyoming Department of Education deployed PortalGuard IDaaS, adding up to 20,000 SaaS end users. Additionally, many existing higher ed customers are migrating from our on-premises solution to PortalGuard IDaaS, further expanding our base of recurring revenue.

“Building on this, we executed a strategic partnership and Joint Purchase Agreement in Q1’25 with California’s Education Technology Joint Powers Authority (Ed Tech JPA), resulting in PortalGuard becoming an approved solution for the alliance’s 195 K-12 schools and districts, servicing over 2.6M students. Importantly, BIO-key solutions are uniquely positioned to comply with California’s Phone-Free Schools Act (AB-1326) policies limiting or prohibiting smartphone use in schools by July 2026. Most competing solutions rely on phone authenticators or hardware security keys, neither of which are practical solutions for schools.

“From a strategic standpoint, we are excited about the revenue and margin potential in EMEA now that we have refocused our efforts on BIO-key solutions in those markets. Our transition away from Swivel Secure licensed solutions beginning in the second half of 2024 resulted in some challenging year-over-year revenue comparisons but we fully expect to return our EMEA performance to growth and enhanced margins over the remainder of 2025.

“Based on the security, flexibility, ease of deployment and compelling ROI provided by our solutions, we feel well positioned to deliver improved top- and bottom-line results in 2025. However, given the timing of large customer orders or renewals, our financial performance is likely to fluctuate on a quarter-to-quarter basis. Given increasing interest in our biometric solutions, growing adoption of passwordless, phoneless and tokenless IAM solutions, our improved balance sheet, strong margin profile, and revenue traction in EMEA markets, we are very optimistic about our growth outlook. We also continue to seek opportunities to reduce costs and lower our breakeven level to support our path to positive cash flow and profitability.”

Financial Results

Total revenues decreased to $1,607,159 in Q1’25 from $2,181,203, mainly due to the impact of $1.2M in Q1’24 revenue from a 2-year renewal contract with a long-term financial services customer vs. $690k from this customer in Q1’25. License fee revenue decreased to $1,098,758 in Q1’25 from $1,950,434 a year ago, reflecting the variance in revenue from the long-term financial services customer, as well as the impact on revenue of transitioning from selling third-party Swivel Secure products and services to BIO-key products, in the EMEA region.

Service revenues increased to $272,598 in Q1’25 from $213,122 in Q1’24, including approximately $265,000 and $193,000, respectively, of recurring maintenance and support revenue, and $8,000 and $20,000, respectively, of non-recurring custom services revenue. The recurring revenue increase of $72,000 or 37% was due to incremental support services for a large customer service agreement. Non-recurring custom services decreased due to the removal of a large Swivel Secure customer.

Hardware sales increased to $235,803 in Q1’25 from $17,647 in Q1’24, due largely to increased purchases of fingerprint biometric scanners in support of certain customers’ expanded deployments in Q1’25.

Gross profit decreased to $1,327,661 in Q1’25 from $1,881,560 in Q1’24, reflecting gross margins of 82.6% and 86.3%, respectively. The gross profit decline is due primarily to lower revenue in Q1’25 as well as the impact of higher levels of lower margin hardware revenue.

BIO-key reduced its Q1’25 operating expenses by $422,195 to $1,968,299 from $2,390,494 in Q1’24, due to reductions of $410,449 in SG&A and $11,746 in research, development and engineering. Q1’25 SG&A expenses decreased 23% to $1,372,524 from $1,782,973 in Q1’24, reflecting reductions in administration, sales personnel costs, and professional service fees. The RD&E decrease was due primarily to lower rent costs.

Reflecting lower revenues which was partially offset by lower operating costs, BIO-key’s Q1’25 net loss increased to $736,545, or ($0.16) per share, as compared to $510,285, or ($0.32) per share, in Q1’24.

Balance Sheet

As of March 31, 2025, BIO-key’s total current assets improved to $4.6M, including $3.1M of cash and cash equivalents, $0.8M of net accounts receivable and due from factor, and approximately $358,000 of inventory. This compares to total current assets of $1.9M at December 31, 2024, including approximately $438,000 of cash and cash equivalents, $0.8M of net accounts receivable and due from factor, and $378,000 of inventory.

Conference Call Details

Date / Time:	Friday, May 16th at 10 a.m. ET
Call Dial In #:	1-877-418-5460 U.S. or 1-412-717-9594 Int’l
Live Webcast / Replay:	Webcast & Replay Link – Available for 3 months.
Audio Replay:	1-877-344-7529 U.S. or 1-412-317-0088 Int’l; code 6501265

About BIO-key International, Inc. (www.BIO-key.com)

BIO-key is revolutionizing authentication and cybersecurity with biometric-centric, multi-factor identity and access management (IAM) software securing access for over forty million users. BIO-key allows customers to choose the right authentication factors for diverse use cases, including phoneless, tokenless, and passwordless biometric options. Its hosted or on-premise PortalGuard IAM solution provides cost-effective, easy-to-deploy, convenient, and secure access to computers, information, applications, and high-value transactions.

BIO-key Safe Harbor Statement

All statements contained in this press release other than statements of historical facts are “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995 (the “Act”). The words “estimate,” “project,” “intends,” “expects,” “anticipates,” “believes” and similar expressions are intended to identify forward-looking statements. Such forward-looking statements are made based on management’s beliefs, as well as assumptions made by, and information currently available to, management pursuant to the “safe-harbor” provisions of the Act. These statements are not guarantees of future performance or events and are subject to risks and uncertainties that may cause actual results to differ materially from those included within or implied by such forward-looking statements. These risks and uncertainties include, without limitation, our history of losses and limited revenue; our ability to raise additional capital to satisfy working capital needs; our ability to continue as a going concern; our ability to protect our intellectual property; changes in business conditions; changes in our sales strategy and product development plans; changes in the marketplace; continued services of our executive management team; security breaches; competition in the biometric technology and identity access management industries; market acceptance of biometric products generally and our products under development; our ability to convert sales opportunities to customer contracts; our ability to expand into Asia, Africa and other foreign markets; our ability to migrate Swivel Secure customers to BIO-key and Portal Guard offerings; our ability to execute definitive agreements with Fiber Food Systems and/or its customers to utilize our access management solutions; our ability to integrate our solutions into any of Fiber Food System’s offerings; fluctuations in foreign currency exchange rates; the duration and extent of continued hostilities in Ukraine and its impact on our European customers; the impact of tariffs and other trade barriers which may make it more costly for us to import inventory from China and Hong Kong and certain product components from South Korea; delays in the development of products, the commercial, reputational and regulatory risks to our business that may arise as a consequence of the restatement of our financial statements, including any consequences of non-compliance with Securities and Exchange Commission and Nasdaq periodic reporting requirements; our temporary loss of the use of a Registration Statement on Form S-3 to register securities in the future; any disruption to our business that may occur on a longer-term basis should we be unable to continue to maintain effective internal controls over financial reporting, and statements of assumption underlying any of the foregoing as well as other factors set forth under the caption “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2024 and other filings with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date made. Except as required by law, we undertake no obligation to disclose any revision to these forward-looking statements whether as a result of new information, future events, or otherwise.

Engage with BIO-key

Investor Contacts

William Jones, David Collins
Catalyst IR
BKYI@catalyst-ir.com or 212-924-9800

BIO-KEY INTERNATIONAL, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited)

	Three Months Ended
	March 31,
	2025			2024
Revenues
Services	$	272,598		$	213,122
License fees		1,098,758			1,950,434
Hardware		235,803			17,647
Total revenues		1,607,159			2,181,203
Costs and other expenses
Cost of services		98,144			138,849
Cost of license fees		72,885			148,221
Cost of hardware		108,469			12,573
Total costs and other expenses		279,498			299,643
Gross profit		1,327,661			1,881,560

Operating Expenses
Selling, general and administrative		1,372,524			1,782,973
Research, development and engineering		595,775			607,521
Total Operating Expenses		1,968,299			2,390,494
Operating loss		(640,638	)		(508,934	)
Other income (expense)
Interest income		3			5
Loan fee amortization		(60,000	)		–
Interest expense		(35,910	)		(1,356	)
Total other income (expense), net		(95,907	)		(1,351	)

Loss before provision for income tax		(736,545	)		(510,285	)

Provision for (income tax) tax benefit		–			–

Net loss	$	(736,545	)	$	(510,285	)

Comprehensive loss:
Net loss	$	(736,545	)	$	(510,285	)
Other comprehensive income (loss) – Foreign currency translation adjustment		6,803			(62,275	)
Comprehensive loss	$	(729,742	)	$	(572,560	)

Basic and Diluted Loss per Common Share	$	(0.16	)	$	(0.32	)

Weighted Average Common Shares Outstanding:
Basic and diluted		4,702,421			1,615,323

BIO-KEY INTERNATIONAL, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS

	March 31,			December 31,
	2025			2024
	(Unaudited)
ASSETS
Cash and cash equivalents	$	3,133,752		$	437,604
Accounts receivable, net		803,277			718,229
Due from factor		40,450			74,170
Inventory		357,842			378,307
Prepaid expenses and other		254,285			278,648
Total current assets		4,589,606			1,886,958
Equipment and leasehold improvements, net		122,986			140,198
Capitalized contract costs, net		375,705			409,426
Deposits and other assets		7,976			7,976
Operating lease right-of-use assets		67,142			73,372
Investments		5,000,000			5,000,000
Intangible assets, net		1,020,261			1,097,630
Total non-current assets		6,594,070			6,728,602
TOTAL ASSETS	$	11,183,676		$	8,615,560

LIABILITIES
Accounts payable	$	568,836		$	818,187
Accrued liabilities		1,042,411			1,278,732
Note payable		762,151			1,525,977
Government loan – BBVA Bank, current portion		138,667			132,731
Deferred revenue, current		928,291			773,267
Operating lease liabilities, current portion		25,260			24,642
Total current liabilities		3,465,616			4,553,536
Deferred revenue, long term		136,931			196,237
Government loan – BBVA Bank – net of current portion		11,666			44,762
Operating lease liabilities, net of current portion		42,410			48,994
Total non-current liabilities		191,007			289,993
TOTAL LIABILITIES		3,656,623			4,843,529

Commitments and Contingencies

STOCKHOLDERS’ EQUITY

Common stock — authorized, 170,000,000 shares; issued and outstanding; 5,814,041 and 3,715,483 of $.0001 par value at March 31, 2025 and December 31, 2024, respectively		582			372
Additional paid-in capital		137,514,825			133,030,271
Accumulated other comprehensive loss		56,093			49,290
Accumulated deficit		(130,044,447	)		(129,307,902	)
TOTAL STOCKHOLDERS’ EQUITY		7,527,053			3,772,031
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	11,183,676		$	8,615,560

BIO-KEY INTERNATIONAL, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

	Three Months Ended March 31,
	2025			2024

CASH FLOW FROM OPERATING ACTIVITIES:
Net loss	$	(736,545	)	$	(510,285	)
Adjustments to reconcile net loss to net cash used for operating activities:
Depreciation		21,782			23,808
Amortization of intangible assets		76,245			78,005
Amortization of capitalized contract costs		46,545			38,665
Amortization of Note Payable		60,000			–
Interest payable on Note		35,173			–
Operating leases right-of-use assets		6,230			13,686
Share and warrant-based compensation for employees and consultants		52,488			47,790
Stock based directors’ fees		9,002			9,003
Bad debts		15,000			100,000
Change in assets and liabilities:
Accounts receivable		(85,048	)		399,749
Due from factor		33,720			91,070
Capitalized contract costs		(12,824	)		(158,005	)
Inventory		20,465			5,545
Prepaid expenses and other		24,363			(63,513	)
Accounts payable		(259,571	)		(116,012	)
Accrued liabilities		(236,321	)		(104,257	)
Deferred revenue		95,718			455,868
Operating lease liabilities		(1,734	)		(14,033	)
Net cash used in operating activities		(835,312	)		297,084
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		(4,570	)		(1,869	)
Net cash used in investing activities		(4,570	)		(1,869	)
CASH FLOW FROM FINANCING ACTIVITIES:
Offering costs		(248,783	)		(13,470	)
Proceeds for exercise of warrants		3,813,057			1,400
Receipt of cash from Employee stock purchase plan		–			–
Repayment of government loan		(35,047	)		(41,821	)
Net cash used in financing activities		3,529,227			(53,891	)

Effect of exchange rate changes		6,803			(62,275	)

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		2,696,148			179,049
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		437,604			511,400
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	3,133,752		$	690,449

The MIL Network –

May 16, 2025

MIL-OSI: Caliber Reports First Quarter 2025 Results

Source: GlobeNewswire (MIL-OSI)

SCOTTSDALE, Ariz., May 15, 2025 (GLOBE NEWSWIRE) — Caliber (NASDAQ: CWD; “CaliberCos Inc.”), a real estate investor, developer, and asset manager, today reported results for the first quarter ended on March 31, 2025.

First Quarter 2025 Platform Financial Highlights (compared to First Quarter 2024)

Platform revenue of $3.5 million, compared to $4.7 million
- Asset management revenue of $3.5 million drove the stated results
- No significant performance allocations were earned, compared to prior period
Platform net loss of $4.1 million, or $3.59 per diluted share, compared to Platform net loss of $3.6 million, or $3.30 per diluted share
Platform Adjusted EBITDA loss of $1.4 million, compared to Platform Adjusted EBITDA loss of $1.7 million

Management Commentary

“Building on the narrowed strategy we outlined earlier this year, Caliber is now actively executing with a focus in hospitality, multifamily, and multi-tenant industrial real estate,” said Chris Loeffler, CEO of Caliber. “While our Q1 results reflect some of the transitional costs associated with this shift, our recent business developments set the stage for success.

“Our recently announced partnership with Hyatt is a tremendous win for Caliber. The announcement is also a vote of confidence from an industry leader that provides a strategic advantage in building our Caliber Hospitality portfolio.

“Our strategy is to continue focusing on fee-generating, income-producing assets while reducing our exposure to long-duration development projects. We have also strengthened our liquidity through new equity offerings, strengthened our balance sheet through financing, and improved our operating efficiency.”

Business Update

The following are key milestones completed both during and subsequent to the first quarter ended March 31, 2025.

On March 17, 2025, Caliber announced an offering of Series AA Cumulative Redeemable Preferred Stock had been qualified by the U.S. Securities and Exchange Commission (“SEC”) and that the Company is seeking to raise up to $20 million through the offering.
On March 27, 2025, Caliber announced the launch of its 1031 Exchange Program, a tax-deferral strategy that allows real estate investors to sell a property and reinvest all of the proceeds into a like-kind property while deferring capital gains taxes.
On April 22, 2025, Caliber announced the recent Phoenix City Council’s unanimous approval of the Company’s Canyon Village redevelopment project, a retrofit of a distressed +300,000 square foot office building to a 376-unit rental multifamily residential building. The project also benefits from opportunity zone tax incentives.
On May 8, 2025, Caliber announced that Caliber Hospitality Development (“CHD”) has entered into a Development Rights Agreement with an affiliate of Hyatt Hotels Corporation (NYSE: H) to exclusively develop 15 new Hyatt Studios hotels in target market areas within Arizona, Colorado, Nevada, Texas and Louisiana.
On May 9, 2025, Caliber announced it closed a $22.5 million refinance on the Doubletree by Hilton Hotel in Tuscon, AZ, which is a holding of a Caliber-managed opportunity zone fund. The new $22.5 million loan was refinanced with a unit of Citibank at a fixed rate of 7.43% maturing in June 2030. Proceeds will be utilized for reinvestment across the Fund’s portfolio.

First Quarter 2025 Consolidated Financial Results (compared to First Quarter 2024)

Total consolidated revenue of $7.3 million, compared to $23.0 million reflecting the deconsolidation of Caliber Hospitality Trust, Caliber Hospitality, LP, Elliot, DT Mesa, and Caliber Fixed Income Fund III, LLC (“CFIF III”) in 2024.
Consolidated net loss attributable to Caliber of $4.4 million, or $3.85 per diluted share, compared to net loss attributable to Caliber of $3.8 million or $3.53 per diluted share
Consolidated Adjusted EBITDA loss of $0.1 million, compared to Consolidated Adjusted EBITDA of $2.2 million

Conference Call Information

Caliber will host a conference call today, Thursday, May 15, 2025, at 5:00 p.m. Eastern Time (ET) to discuss its first quarter 2025 financial results and business outlook. To access this call, dial 1-800-717-1738 (domestic) or 1-646-307-1865 (international). A live webcast of the conference call will be available via the investor relations section of Caliber’s website under “Financial Results.” The webcast replay of the conference call will be available on Caliber’s website shortly after the call concludes.

Platform Financial Highlights

Within this earnings release, we refer to performance results of the ‘Platform’. Platform refers to the performance of CWD itself, excluding the performance of any assets and funds that are included in our consolidated results, as required by the Generally Accepted Accounting Principles (“GAAP”). Management believes that Platform performance offers the most meaningful information needed to understand the value of CWD. The assets and funds that are consolidated into our GAAP presentation are included because Caliber is a guarantor of debt held by these assets and funds.

While GAAP consolidation rules require CWD to include the performance and cash flows of these assets and funds in our consolidated financial information, CWD does not benefit from the performance of those assets and funds, except to the extent that CWD earns fees from managing the assets and funds (which are included in the Platform results). Management believes presenting Platform results, which exclude consolidated assets, directly shows the business performance that CWD stockholders benefit from.

Consolidated Financial Results

Caliber’s GAAP consolidated financial statements have been impacted by the deconsolidation of certain variable interest entities’ assets, liabilities, revenues, and expenses. These entities were deconsolidated because Caliber was no longer a guarantor on the respective entities’ third-party debt. Caliber’s GAAP financial metrics are impacted by the timing of deconsolidation. As such, prior periods presented may not be comparable due to the deconsolidation of certain entities in the current period.

About Caliber (CaliberCos Inc.) (NASDAQ: CWD)

With more than $2.9 billion of managed assets, including estimated costs to complete assets under development, Caliber’s 15-year track record of managing and developing real estate is built on a singular goal: make money in all market conditions. Our growth is fueled by our performance and our competitive advantage: we invest in projects, strategies, and geographies that global real estate institutions do not. Integral to our competitive advantage is our in-house shared services group, which offers Caliber greater control over our real estate and visibility to future investment opportunities. There are multiple ways to participate in Caliber’s success: invest in Nasdaq-listed CaliberCos Inc. and/or invest directly in our Private Funds.

Forward Looking Statements

This press release contains “forward-looking statements” that are subject to substantial risks and uncertainties. All statements, other than statements of historical fact, contained in this press release are forward-looking statements. Forward-looking statements contained in this press release may be identified by the use of words such as “anticipate,” “believe,” “contemplate,” “could,” “estimate,” “expect,” “intend,” “seek,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “target,” “aim,” “should,” “will” “would,” or the negative of these words or other similar expressions, although not all forward-looking statements contain these words. Forward-looking statements are based on the Company’s current expectations and are subject to inherent uncertainties, risks and assumptions that are difficult to predict. Further, certain forward-looking statements are based on assumptions as to future events that may not prove to be accurate including, but not limited to, the Company’s ability to adequately grow cumulative fundraising, AUM and annualized platform revenue to meet 2026 targeted goals, and the viability of and ability of the Company to adequately access the real estate and capital markets. These and other risks and uncertainties are described more fully in the section titled “Risk Factors” in the final prospectus related to the Company’s public offering filed with the SEC and other reports filed with the SEC thereafter. Forward-looking statements contained in this announcement are made as of this date, and the Company undertakes no duty to update such information except as required under applicable law.

CONTACTS:

Caliber Investor Relations:
Ilya Grozovsky
+1 480-214-1915
Ilya@caliberco.com

NON-GAAP RECONCILIATIONS

The following information reconciles the performance of the Platform to the consolidated GAAP presentation. Management believes that the Platform view of Caliber’s performance is more meaningful to a CWD shareholder as it includes all revenues and expenses generated by Caliber and its wholly-owned subsidiaries.

ASSET MANAGEMENT PLATFORM⁽¹⁾ (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED)

	Three Months Ended March 31, 2025
	Platform			Impact of Consolidated Fund and Eliminations			Consolidated
Revenues
Asset management	$	3,542		$	(346	)	$	3,196
Performance allocations		7			(6	)		1
Consolidated funds – hospitality revenue		—			3,919			3,919
Consolidated funds – other revenue		—			145			145
Total revenues		3,549			3,712			7,261
Expenses
Operating costs		4,168			(124	)		4,044
General and administrative		1,592			(11	)		1,581
Marketing and advertising		165			—			165
Depreciation and amortization		162			(5	)		157
Consolidated funds – hospitality expenses		—			3,465			3,465
Consolidated funds – other expenses		—			458			458
Total expenses		6,087			3,783			9,870

Other income (loss), net		6			(372	)		(366	)
Interest income		33			(1	)		32
Interest expense		(1,611	)		—			(1,611	)
Net loss before income taxes	$	(4,110	)	$	(444	)	$	(4,554	)
Provision for income taxes		—			—			—
Net loss		(4,110	)		(444	)		(4,554	)
Net loss attributable to noncontrolling interests		—			(147	)		(147	)
Net (loss) income attributable to CaliberCos Inc.	$	(4,110	)	$	(297	)	$	(4,407	)
Basic and Diluted Platform loss per share	$	(3.59	)				$	(3.85	)
Weighted average common shares outstanding:
Basic and Diluted		1,146						1,146

	Three Months Ended March 31, 2024
	Platform			Impact of Consolidated Fund and Eliminations			Consolidated
Revenues
Asset management	$	4,555		$	(1,385	)	$	3,170
Performance allocations		171			(5	)		166
Consolidated funds – hospitality revenue		—			18,145			18,145
Consolidated funds – other revenue		—			1,470			1,470
Total revenues		4,726			18,225			22,951
Expenses
Operating costs		5,484			(222	)		5,262
General and administrative		1,949			(9	)		1,940
Marketing and advertising		106			—			106
Depreciation and amortization		183			(37	)		146
Consolidated funds – hospitality expenses		—			16,782			16,782
Consolidated funds – other expenses		—			3,072			3,072
Total expenses		7,722			19,586			27,308

Other income (loss), net		452			(180	)		272
Interest income		285			(168	)		117
Interest expense		(1,295	)		1			(1,294	)
Net loss before income taxes	$	(3,554	)	$	(1,708	)	$	(5,262	)
Provision for income taxes		—			—			—
Net loss		(3,554	)		(1,708	)		(5,262	)
Net loss attributable to noncontrolling interests		—			(1,457	)		(1,457	)
Net loss attributable to CaliberCos Inc.	$	(3,554	)	$	(251	)	$	(3,805	)
Basic and Diluted Platform loss per share	$	(3.30	)				$	(3.53	)
Weighted average common shares outstanding:
Basic and diluted		1,077						1,077

____________________

(1)	Represents the results of our asset management platform, which are presented on a basis that deconsolidates our consolidated funds (intercompany eliminations) and eliminate noncontrolling interest.


PLATFORM REVENUE⁽¹⁾ (AMOUNTS IN THOUSANDS) (UNAUDITED)
	Three Months Ended March 31,
		2025		2024
Fund management fees		2,744		2,569
Financing fees		74		73
Development and construction fees		528		1,654
Brokerage fees		196		259
Total asset management		3,542		4,555
Performance allocations		7		171
Total revenue	$	3,549	$	4,726

____________________

(1)	Represents the results of our asset management platform, which are presented on a basis that deconsolidates our consolidated funds (intercompany eliminations) and eliminates noncontrolling interest.

FV AUM and Managed Capital (UNAUDITED)

The following information summarizes management’s estimates of fair value related to the entire portfolio of investments that Caliber manages and the total amount of capital that is being managed across the portfolio. The fair value of our AUM conveys an indication of the overall health of our investments and potentially how much performance allocation Caliber would earn if those assets were sold. Managed Capital is used to evaluate, among other things, the amount of asset management fees we generate from the portfolio.

FV AUM (AMOUNTS IN THOUSANDS) (UNAUDITED)

Balances as of December 31, 2024	$	794,923
Assets acquired⁽¹⁾		10,300
Construction and net market appreciation		25,800
Credit⁽²⁾		379
Other⁽³⁾		(644	)
Balances as of March 31, 2025	$	830,758

FV AUM, by asset class (AMOUNTS IN THOUSANDS) (UNAUDITED)

	March 31, 2025		December 31, 2024
Real Estate
Hospitality	$	68,400	$	68,500
Caliber Hospitality Trust		244,900		236,800
Residential		173,100		161,700
Commercial		266,300		249,600
Total Real Estate		752,700		716,600
Credit⁽¹⁾		72,730		72,351
Other⁽²⁾		5,328		5,972
Total	$	830,758	$	794,923

____________________

(1)	Credit FV AUM represents loans made to Caliber’s investment funds by our diversified credit fund.
(2)	Other FV AUM represents undeployed capital held in our diversified funds.

MANAGED CAPITAL (AMOUNTS IN THOUSANDS) (UNAUDITED)

Balance as of December 31, 2024			$	492,542
Originations				2,990
Return of capital				(315	)
Balance as of March 31, 2025			$	495,217


	March 31, 2025		December 31, 2024
Real Estate
Hospitality	$	49,260	$	49,260
Caliber Hospitality Trust⁽¹⁾		97,157		97,414
Residential		98,617		96,687
Commercial		172,125		170,858
Total Real Estate⁽²⁾		417,159		414,219
Credit⁽³⁾		72,730		72,351
Other⁽⁴⁾		5,328		5,972
Total	$	495,217	$	492,542

____________________

(1)	The Company earns a fund management fee of 0.70% of the Caliber Hospitality Trust’s enterprise value and is reimbursed for certain costs incurred on behalf of the Caliber Hospitality Trust.
(2)	Beginning during the year ended December 31, 2023, the Company includes capital raised from investors in CaliberCos Inc. through corporate note issuances that was further invested in our funds in Managed Capital. As of March 31, 2025 and December 31, 2024, the Company had invested $15.9 million and $20.4 million, respectively, in our funds.
(3)	Credit managed capital represents loans made to Caliber’s investment funds by the Company and our diversified funds. As of March 31, 2025 and December 31, 2024, the Company had loaned $0.4 million to our funds.
(4)	Other managed capital represents unemployed capital held in our diversified funds.

Consolidated GAAP Results

The following information presents our consolidated GAAP results which includes the performance of certain entities we manage where Caliber is the guarantor of debt owed by those entities, despite not having significant equity at risk. As a result of these guarantor commitments, Caliber is required under GAAP to include the assets, liabilities, revenues and expenses of those entities even though a shareholder of CWD stock is neither entitled to nor exposed by those entities’ benefits or obligations. This accounting outcome also removes revenues that we earn from those entities, which a shareholder of CWD stock would be entitled to. See discussion elsewhere related to CWD’s Platform performance.

CALIBERCOS INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)

	Three Months Ended March 31,
		2025			2024
	(unaudited)
Revenues
Asset management revenues	$	3,196		$	3,170
Performance allocations		1			166
Consolidated funds – hospitality revenues		3,919			18,145
Consolidated funds – other revenues		145			1,470
Total revenues		7,261			22,951

Expenses
Operating costs		4,044			5,262
General and administrative		1,581			1,940
Marketing and advertising		165			106
Depreciation and amortization		157			146
Consolidated funds – hospitality expenses		3,465			16,782
Consolidated funds – other expenses		458			3,072
Total expenses		9,870			27,308

Other (loss) income, net		(366	)		272
Interest income		32			117
Interest expense		(1,611	)		(1,294	)
Net loss before income taxes		(4,554	)		(5,262	)
Benefit from income taxes		—			—
Net loss		(4,554	)		(5,262	)
Net loss attributable to noncontrolling interests		(147	)		(1,457	)
Net loss attributable to CaliberCos Inc.	$	(4,407	)	$	(3,805	)
Basic and diluted net loss per share attributable to common stockholders	$	(3.85	)	$	(3.53	)
Weighted average common shares outstanding:
Basic and diluted		1,146			1,077

CALIBERCOS INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (AMOUNTS IN THOUSANDS, EXCEPT FOR SHARE AND PER SHARE DATA)

	March 31, 2025		December 31, 2024
	(unaudited)
Assets
Cash	$	845	$	1,766
Restricted cash		2,518		2,582
Real estate investments, net		21,514		21,572
Notes receivable – related parties, allowance of $236 and zero, respectively		385		105
Due from related parties, allowance of $3,985		7,366		6,965
Investments in unconsolidated entities		15,523		15,643
Operating lease – right of use assets		135		147
Prepaid and other assets		2,664		3,501
Assets of consolidated funds
Cash		723		549
Restricted cash		274		—
Real estate investments, net		44,102		45,090
Accounts receivable, net		181		163
Notes receivable – related parties		6,475		6,848
Due from related parties, allowance of $28		514		320
Prepaid and other assets		424		284
Total assets	$	103,643	$	105,535

Liabilities and Stockholders’ Equity
Notes payable	$	51,555	$	50,450
Accounts payable and accrued expenses		9,421		9,532
Due to related parties		443		313
Operating lease liabilities		86		93
Other liabilities		1,317		750
Liabilities of consolidated funds
Notes payable, net		29,444		29,172
Notes payable – related parties		2,114		2,047
Accounts payable and accrued expenses		1,123		1,207
Due to related parties		16		79
Other liabilities		766		639
Total liabilities		96,285		94,282

Commitments and Contingencies (Note 11)

CALIBERCOS INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (AMOUNTS IN THOUSANDS, EXCEPT FOR SHARE AND PER SHARE DATA)

	March 31, 2025			December 31, 2024
Series A non-cumulative convertible preferred stock, $0.001 par value; 22,500,000 shares authorized, and 5,875 and 5,000 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively		—			—
Common stock Class A, $0.001 par value; 100,000,000 shares authorized, 795,285 and 759,370 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively		1			1
Common stock Class B, $0.001 par value; 15,000,000 shares authorized, 370,822 shares issued and outstanding as March 31, 2025 and December 31, 2024		—			—
Paid-in capital		45,205			44,017
Accumulated deficit		(61,014	)		(56,607	)
Stockholders’ deficit attributable to CaliberCos Inc.		(15,808	)		(12,589	)
Stockholders’ equity attributable to noncontrolling interests		23,166			23,842
Total stockholders’ equity		7,358			11,253
Total liabilities and stockholders’ equity	$	103,643		$	105,535

Definitions

Assets Under Management

AUM refers to the assets we manage or sponsor. We monitor two types of information with regard to our AUM:

Managed Capital – we define this as the total capital we fundraise from our customers as investments in our funds. It also includes fundraising into our corporate note program, the proceeds of which were used, in part, to invest in or loan to our funds. We use this information to monitor, among other things, the amount of ‘preferred return’ that would be paid at the time of a distribution and the potential to earn a performance fee over and above the preferred return at the time of the distribution. Our fund management fees are based on a percentage of managed capital or a percentage of assets under management, and monitoring the change and composition of managed capital provides relevant data points for Caliber management to further calculate and predict future earnings.
Fair Value (“FV”) AUM – we define this is as the aggregate fair value of the real estate assets we manage and from which we derive management fees, performance revenues and other fees and expense reimbursements. We estimate the value of these assets quarterly to help make sale and hold decisions and to evaluate whether an existing asset would benefit from refinancing or recapitalization. This also gives us insight into the value of our carried interest at any point in time. We also utilize FV AUM to predict the percentage of our portfolio which may need development services in a given year, fund management services (such as refinance), and brokerage services. As we control the decision to hire for these services, our service income is generally predictable based upon our current portfolio AUM and our expectations for AUM growth in the year forecasted.

Non-GAAP Measures

We use non-GAAP financial measures to evaluate operating performance, identify trends, formulate financial projections, make strategic decisions, and for other discretionary purposes. We believe that these measures enhance the understanding of ongoing operations and comparability of current results to prior periods and may be useful for investors to analyze our financial performance because they provide investors a view of the performance attributable to CaliberCos Inc. When analyzing our operating performance, investors should use these measures in addition to, and not as an alternative for, their most directly comparable financial measure calculated and presented in accordance with U.S. GAAP. Our presentation of non-GAAP measures may not be comparable to similarly identified measures of other companies because not all companies use the same calculations. These measures may also differ from the amounts calculated under similarly titled definitions in our debt instruments, which amounts are further adjusted to reflect certain other cash and non-cash charges and are used by us to determine compliance with financial covenants therein and our ability to engage in certain activities, such as incurring additional debt and making certain restricted payments.

Asset Management Platform or Platform

Platform refers to the performance of the Caliber asset management platform, which generates revenues and expenses from managing our investment portfolio, which does not include any consolidated assets or funds. These activities include asset management, transaction services, and performance allocations. Management believes that this is an important view of the Company because it communicates performance of the Company that would be most useful for understanding the value of CWD.

Fee-Related Earnings and Related Components

Fee-Related Earnings is a supplemental non-GAAP performance measure used to assess our ability to generate profits from fee-based revenues, focusing on whether our core revenue streams, are sufficient to cover our core operating expenses. Fee- Related Earnings represents the Company’s net income (loss) before income taxes adjusted to exclude depreciation and amortization, stock-based compensation, interest expense and extraordinary or non-recurring revenue and expenses, including performance allocation revenue and gain (loss) on extinguishment of debt, public registration direct costs related to aborted or delayed offerings and our Reg A+ offering, the share repurchase costs related to the Company’s Buyback Program, litigation settlements, and expenses recorded to earnings relating to investment deals which were abandoned or closed. Fee-Related Earnings is presented on a basis that deconsolidates our consolidated funds (intercompany eliminations) and eliminates noncontrolling interest. Eliminating the impact of consolidated funds and noncontrolling interest provides investors a view of the performance attributable to CaliberCos Inc. and is consistent with performance models and analysis used by management.

Distributable Earnings

Distributable Earnings is a supplemental non-GAAP performance measure equal to Fee-Related Earnings plus performance allocation revenue and less interest expenses and provision for income taxes. We believe that Distributable Earnings can be useful as a supplemental performance measure to our GAAP results assessing the amount of earnings available for distribution.

Platform Earnings

Platform Earnings represents the performance of the Caliber asset management platform, which generates revenues and expenses from managing our investment portfolio, excluding any consolidated assets or funds.

Platform Earnings per Share

Platform Earnings per Share is calculated as Platform Earnings divided by weighted average CWD common shares outstanding.

Platform Adjusted EBITDA

Platform Adjusted EBITDA represents the Company’s Distributable Earnings adjusted for interest expense, the share repurchase costs related to the Company’s Buyback Program, other income (expense), and provision for income taxes on a basis that deconsolidates our consolidated funds (intercompany eliminations), Loss on CRAF Investment Redemption, Gain on extinguishment of Payroll Protection Program loans, and eliminates noncontrolling interest. Eliminating the impact of consolidated funds and noncontrolling interest provides investors a view of the performance attributable to the CaliberCos Inc. Platform and is consistent with performance models and analysis used by management.

Consolidated Adjusted EBITDA

Consolidated Adjusted EBITDA represents the Company’s and the consolidated funds’ earnings before net interest expense, income taxes, depreciation and amortization, further adjusted to exclude stock-based compensation, transaction fees, expenses and other public registration direct costs related to aborted or delayed offerings and our Reg A+ offering, the share repurchase costs related to the Company’s Buyback Program, litigation settlements, expenses recorded to earnings relating to investment deals which were abandoned or closed, any other non-cash expenses or losses, as further adjusted for extraordinary or non-recurring items.

NON-GAAP ADJUSTED EBITDA (AMOUNTS IN THOUSANDS) (UNAUDITED)

	Three Months Ended March 31,
		2025			2024
Net loss attributable to CaliberCos Inc.	$	(4,407	)	$	(3,805	)
Net loss attributable to noncontrolling interests		(147	)		(1,457	)
Net loss		(4,554	)		(5,262	)
Provision for income taxes		—			—
Net loss before income taxes		(4,554	)		(5,262	)
Depreciation and amortization		162			183
Consolidated funds’ impact on fee-related earnings		71			1,361
Stock-based compensation		661			400
Severance		51			7
Performance allocations		(1	)		(166	)
Other income, net		366			(272	)
Investments impairment		279			—
Bad debt expense		3			—
Interest expense, net		1,578			1,010
Fee-related earnings		(1,384	)		(2,739	)
Performance allocations		1			166
Interest expense, net		(1,578	)		(1,010	)
Provision for income taxes		—			—
Distributable earnings		(2,961	)		(3,583	)
Interest expense		1,611			1,294
Other income, net		(366	)		272
Provision for income taxes		—			—
Consolidated funds’ impact on Platform adjusted EBITDA		364			348
Platform adjusted EBITDA		(1,352	)		(1,669	)
Consolidated funds’ EBITDA adjustments		1,210			3,856
Consolidated adjusted EBITDA	$	(142	)	$	2,187

The MIL Network –

May 16, 2025

MIL-OSI: Signing Day Sports Announces Selected Financial Results for Quarter Ended March 31, 2025 and Provides Business Update

Source: GlobeNewswire (MIL-OSI)

Reduces Net Loss for Quarter by 66% Year-Over-Year, Reflecting Improved Operating Efficiency

Strong Combine Participation and Scalable Digital Platform Expected to Drive Higher Margin Growth

SCOTTSDALE, AZ, May 15, 2025 (GLOBE NEWSWIRE) — Signing Day Sports, Inc. (“Signing Day Sports” or the “Company”) (NYSE American: SGN), the developer of the Signing Day Sports app and platform to aid high school athletes in the recruitment process, today announced selected financial results for the quarter ended March 31, 2025, and provided a business update.

Daniel Nelson, Chief Executive Officer and Chairman of Signing Day Sports, stated, “One of our primary objectives this quarter was to streamline costs and strike the right balance between growth and efficiency—resulting in a 66% year-over-year reduction in net loss. At the same time, we have seen strong athlete engagement through our national combine series and weekly recruiting webinars, which continues to expand our brand visibility. With enhancements to the digital platform and the signing of a new Sponsorship Agreement with the U.S. Army Bowl during the quarter, we believe we are well-positioned to drive growth in higher-margin, subscription-based revenues. We are also advancing strategic initiatives that we believe could significantly enhance long-term shareholder value. Overall, we have laid a strong foundation for scalable growth and meaningful returns, while continuing to enable new college recruiting opportunities for student-athletes and coaches nationwide.”

During the first quarter of 2025, Signing Day Sports advanced its growth strategy by hosting five U.S. Army Bowl Regional Combines in key cities—Atlanta, Georgia; Orlando, Florida; Chicago, Illinois; Phoenix, Arizona; and Jackson, Mississippi—which attracted nearly 1,000 high school athletes. These events reinforce the strong demand for verified performance data and enhanced recruiting visibility.

To extend this momentum, the Company expanded its digital footprint with weekly recruiting webinars that spotlight top student-athletes and promote direct engagement with college coaches. Signing Day Sports also renewed its role as the National Recruiting Partner to the U.S. Army Bowl through 2026, maintaining exclusive rights to national and regional combines and generating revenue from athlete registrations. Verified data collected from these events is automatically integrated into athlete profiles on the Company’s app, enhancing usability and value for both users and coaches.

Financial highlights for the quarter ended March 31, 2025

Revenue totaled approximately $0.15 million for the three months ended March 31, 2025, compared to approximately $0.23 million for the comparable 2024 period.
General and administrative expenses were approximately $0.97 million for the three months ended March 31, 2025, compared to approximately $2.04 million for the 2024 period.
Net loss was approximately $0.84 million for the three months ended March 31, 2025, compared to a net loss of approximately $2.50 million in the same period in 2024.

The selected results included in this press release should be reviewed together with the Company’s complete financial results for the quarter ended March 31, 2025. The complete financial results are available in the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on May 15, 2025 and available at www.sec.gov.

Signing Day Sports

Signing Day Sports’ mission is to help student-athletes achieve their goal of playing college sports. Signing Day Sports’ app allows student-athletes to build their Signing Day Sports’ recruitment profile, which includes information college coaches need to evaluate and verify them through video technology. The Signing Day Sports app includes a platform to upload a comprehensive data set including video-verified measurables (such as height, weight, 40-yard dash, wingspan, and hand size), academic information (such as official transcripts and SAT/ACT scores), and technical skill videos (such as drills and mechanics that exemplify player mechanics, coordination, and development). For more information on Signing Day Sports, go to https://bit.ly/SigningDaySports.

Forward-Looking Statements

This press release contains “forward-looking statements” that are subject to substantial risks and uncertainties. All statements, other than statements of historical fact, contained in this press release are forward-looking statements. Forward-looking statements contained in this press release may be identified by the use of words such as “may,” “could,” “will,” “should,” “would,” “expect,” “plan,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “project” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions. You should not place undue reliance on forward-looking statements because they involve known and unknown risks, uncertainties, and other factors. These risks, uncertainties and other factors are described more fully in the section titled “Risk Factors” in the Company’s periodic reports which are filed with the Securities and Exchange Commission. These risks, uncertainties and other factors are, in some cases, beyond our control and could materially affect results. If one or more of these risks, uncertainties or other factors become applicable, or if our underlying assumptions prove to be incorrect, actual events or results may vary significantly from those implied or projected by the forward-looking statements. No forward-looking statement is a guarantee of future performance. Forward-looking statements contained in this announcement are made as of this date, and the Company undertakes no duty to update such information except as required under applicable law.

Investor Contacts:
Crescendo Communications, LLC
212-671-1020
SGN@crescendo-ir.com

The MIL Network –

May 16, 2025

Category: Taxation

New FITO integrity rule for foreign DMT taxes

Example: New FITO integrity rule for foreign DMT

Example: Eligible designated concessional income

Example: Foreign hybrid limited partnership