INTELLIGENT PROTECTION MANAGEMENT CORP.
For the period ended Jun 30, 2025. Filed Aug 12, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 12, 2025
IPM$1.62-3.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-14.
0001213900-25-043320
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-12.
0001213900-25-074973
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 137 previous paragraphs and 146 current paragraphs.
92 unchanged; 30 reworded; 15 added; 14 removed; 1 previous and 9 current paragraphs rearranged.
Tables are not compared: 19 previous and 22 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (15)
Current report
Second Quarter 2025 Operational Highlights
Current report
Second Half 2025 Business Objectives
Current report
Subscription Revenue
Current report
Our strategic vision is to be the premier provider of secure, reliable, and customer-focused IT solutions. We are committed to delivering scalable and compliant infrastructure through advanced cloud hosting, managed services, cybersecurity, and disaster recovery offerings. By prioritizing security at every layer of our technology stack, we safeguard our clients’ data and operations against evolving threats. Our emphasis on reliability ensures consistent performance and uptime, enabling businesses to operate with confidence and continuity. Above all, we strive to exceed expectations through exceptional customer service, building lasting partnerships and delivering strategic value that empowers our clients to thrive in a dynamic digital landscape.
Current report
Customer acquisition remains a key focus to growth, and we are actively investing in sales and marketing to expand our footprint across strategic verticals. In addition, we are exploring targeted M&A opportunities that complement our core capabilities and accelerate our market reach. As part of our innovation roadmap, we are also evaluating ways to integrate artificial intelligence into our service offerings to help clients improve operational efficiency, enhance security, and unlock new value from their data.
Current report
On July 4, 2025, President Trump signed H.R. 1, the “One Big Beautiful Bill Act”, into law. In accordance with U.S. GAAP, we will account for the tax effects of changes in tax law in the period of enactment which is in the third quarter of 2025. We are currently in the process of analyzing the tax impacts of the law change but we do not expect a material impact on our effective tax rate.
Current report
Six Months Ended June 30, 2025 Compared to Six Months Ended June 30, 2024
Current report
Revenue
Current report
Costs and Expenses
Current report
Total costs and expenses for the six months ended June 30, 2025 increased by $11,105,222, or 427.3%, as compared to the six months ended June 30, 2024. The following table presents our costs and expenses for the six months ended June 30, 2025 and 2024, the increase between those periods, the percentage increase between those periods and the percentage of total revenue that each represented for those periods:
Current report
Cost of revenue
Current report
General and administrative expense
Current report
Non-Operating Income
Current report
Non-operating income for the six months ended June 30, 2025 was $234,070, a decrease of $208,414, or 47.1%, as compared to non-operating income of $442,484 for the six months ended June 30, 2024. The decrease was primarily a result of a decrease in the amount of principal the Company invested and at varying interest rates. Other income for the six months ended June 30, 2025 related to the sale of a domain name that the Company is not using. During the six months ended June 30, 2024 other income included proceeds from a class action lawsuit against a service provider.
Removed paragraphs (14)
Previous report
Board Appointments
Previous report
Pursuant to the Acquisition Agreement, we agreed to cause one representative nominated by Newtek (the “Newtek Representative”) to be appointed to our Board of Directors (the “Board”) promptly following the closing of the Acquisition. Newtek designated Barry Sloane, who is currently Newtek’s Chairman, Chief Executive Officer and President, as the Newtek Representative.
Previous report
Effective as of January 7, 2025, the Board increased the size of the Board from five (5) directors to seven (7) directors and appointed Mr. Sloane to the Board. Mr. Sloane was not appointed to any committee of the Board.
Previous report
In order for the majority of the Board to be comprised of independent directors in accordance with Rule 5605(b) of the listing rules of The Nasdaq Stock Market, LLC and as a result of his expertise in cloud infrastructure and applications and artificial intelligence, the Board also appointed Sidney Rabsatt to the Board, effective as of January 7, 2025. Mr. Rabsatt was also appointed to serve on the Strategic Transactions Committee of the Board.
Previous report
First Quarter 2025 Operational Highlights
Previous report
2025 Business Objectives
Previous report
Revenue Recognition
Previous report
We recognize revenue from sale of services as they perform the underlying services, typically based on time and materials basis based upon hours incurred for the performance completed to date for which we have the right to consideration. We recognize revenue on sales of goods at a point in time when customer takes control of goods, which typically occurs when title and risk of loss have passed to the customer. We recognize revenue on a gross basis for each of its services and product offerings principally because it is primarily responsible for fulfilling the promise to provide specified goods or service and it has discretion in establishing the price of specified good or service.
Previous report
We classify our right to consideration in exchange for deliverables as either a receivable or a contract asset (unbilled receivable). A receivable is a right to consideration that is unconditional (i.e., only the passage of time is required before payment is due). For example, we recognize a receivable for revenue related to our transaction or volume-based contracts when earned regardless of whether amounts have been billed. Such receivables will be presented in accounts receivable, net in our consolidated balance sheets. We maintain an allowance for credit losses to provide for the estimated amount of receivables that may not be collected. The allowance is based upon an assessment of customer creditworthiness, historical payment experience, the age of outstanding receivables, judgment, and other applicable factors.
Previous report
A contract asset is a right to consideration that is conditional upon factors other than the passage of time. Contract assets will be presented in “current and other assets” in our consolidated balance sheets and primarily relate to unbilled amounts on fixed-price contracts utilizing the output method of revenue recognition. Our contract assets and liabilities are reported at the end of each reporting period. The difference between the opening and closing balances of the contract assets and deferred revenue primarily results from the timing difference between performance obligations and the customer’s payment. We receive payments from customers based on the terms established in their contracts, which may vary generally by contract type.
Previous report
Our contract assets and liabilities are reported in a net position on a contract-by-contract basis at the end of each reporting period. The difference between the opening and closing balances of the contract assets and deferred revenue primarily results from the timing difference between performance obligations and the customer’s payment. We receive payments from customers based on the terms established in their contracts, which may vary generally by contract type.
Previous report
We sell hardware and software products on both a stand-alone basis without any services and as a solution bundled with services. When we provide a combination of hardware and software products with the provision of services, we separately identify our performance obligations under the contract and the hardware and/or software products or services that will be provided. The total transaction price for an arrangement with multiple performance obligations is allocated at contract inception to each performance obligation in proportion to the stand-alone selling price of the hardware or software. The selling price is the price at which we would sell a promised good or service separately to a customer. We estimate the price based on observable inputs, including direct labor hours and allocatable costs, or use observable stand-alone prices when they are available. Our professional services include the design and implementation of a wide range of IT products and services. Such services are typically provided by us or third-party subcontractor vendors on a stand-alone basis.
Previous report
We believe that the scale of our user base presents a competitive advantage in the video social networking industry and provides growth opportunities to advance our existing products with up-sell opportunities and build future brands with cross-sell offers. We also believe that our proprietary consumer app technology platform can scalably support large communities of users in activities such as video, voice and text chat, online card games and board games and provide robust user monetization tools.
Previous report
Our continued growth depends on attracting new consumer application users through the introduction of new applications, features and partnerships and further penetration of our existing markets. Our principal growth strategy is to invest in the development of proprietary software, expand our sales and marketing efforts with respect to such software, and increase our consumer application user base through potential platform partnerships and new and existing advertising campaigns that we run through internet and mobile advertising networks, all while balancing the capital needs of the business. Our strategy also includes the acquisition of, or investment in, technologies, solutions or businesses that complement our business and cross-selling them to additional synergistic businesses.
Reworded paragraphs (30)
Previous wording
This Management’s Discussion and Analysis of Financial Condition and Results of Operations is intended to provide a reader of our financial statements with a narrative from the perspective of our management on our financial condition, results of operations, liquidity and certain other factors that may affect our future results. The following discussion and analysis should be read in conjunction with: (i) the accompanying unaudited condensed consolidated financial statements and notes thereto for the three months ended March 31, 2025 and 2024, (ii) the consolidated financial statements and notes thereto for the year ended December 31, 2024 included in our Annual Report on Form 10-K (the “Form 10-K”) filed with the Securities and Exchange Commission (the “SEC”) on March 24, 2025 and (iii) the discussion under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the Form 10-K. Aside from certain information as of December 31, 2024, all amounts herein are unaudited.
Current wording
This Management’s Discussion and Analysis of Financial Condition and Results of Operations is intended to provide a reader of our financial statements with a narrative from the perspective of our management on our financial condition, results of operations, liquidity and certain other factors that may affect our future results. The following discussion and analysis should be read in conjunction with: (i) the accompanying unaudited condensed consolidated financial statements and notes thereto for the three and six months ended June 30, 2025 and 2024, (ii) the consolidated financial statements and notes thereto for the year ended December 31, 2024 included in our Annual Report on Form 10-K (the “Form 10-K”) filed with the Securities and Exchange Commission (the “SEC”) on March 24, 2025 and (iii) the discussion under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the Form 10-K. Aside from certain information as of December 31, 2024, all amounts herein are unaudited.
Previous wording
Our professional services include the design and implementation of a wide range of IT products and services, such as cybersecurity, software planning, IT infrastructure, data center design and configuration, designing and implementing on-premises, hybrid or cloud computing solutions, website development, developing or integrating systems and software and IT cost management.
Current wording
Our professional services include the design and implementation of a wide range of IT products and services, such as cybersecurity, software planning, IT infrastructure, data center design and configuration, designing and implementing on-premise, hybrid or cloud computing solutions, website development, developing or integrating systems and software and IT cost management.
Previous wording
We offer two types of procurement services to our customers. We can either: (i) obtain software and hardware products on behalf of our customers, in which case our vendors drop ship the products to our end customer, or (ii) obtain hardware or software on behalf of our customers and perform additional configuration and/or add additional inputs to the products before the products are shipped to our customer. In the instance where we sell hardware and software products as a solution bundled with services, we typically obtain the products or software from our vendors, add the additional inputs/configuration as detailed in the customer contract, and then ship the products to the end customer.
Current wording
We offer two types of procurement services to our customers. We can either: (i) obtain software and hardware products on behalf of our customers, in which case our vendors drop ship the products to our end customer, or (ii) obtain hardware or software on behalf of our end customers and perform additional configuration and/or add additional inputs to the products before the products are shipped to our customer. In the instance where we sell hardware and software products as a solution bundled with services, we typically obtain the products or software from our vendors, add the additional inputs/configuration as detailed in the customer contract, and then ship the products to the end customer.
Previous wording
On May 8, 2025, the Board approved a stock repurchase plan for up to $400,000 of our outstanding common stock (the “Stock Repurchase Plan”), which expires on the one-year anniversary of such date. Shares may be repurchased from time-to-time in open market transactions at prevailing market prices, in privately negotiated transactions or by other means in accordance with federal securities laws, including Rule 10b5-1 programs, and the Stock Repurchase Plan may be suspended or discontinued at any time. The actual timing, number and value of shares repurchased will be determined by a committee of the Board at its discretion and will depend on a number of factors, including the market price of our common stock, general market and economic conditions, alternative investment opportunities and other corporate considerations. As of the date of this report, no shares of common stock had been repurchased pursuant to the Stock Repurchase Plan.
Current wording
On May 8, 2025, our Board of Directors (the “Board”) approved a stock repurchase plan for up to $400,000 of our outstanding common stock (the “Stock Repurchase Plan”), which expires on the one-year anniversary of such date. Shares may be repurchased from time-to-time in open market transactions at prevailing market prices, in privately negotiated transactions or by other means in accordance with federal securities laws, including Rule 10b5-1 programs, and the Stock Repurchase Plan may be suspended or discontinued at any time. The actual timing, number and value of shares repurchased will be determined by a committee of the Board at its discretion and will depend on a number of factors, including the market price of our common stock, general market and economic conditions, alternative investment opportunities and other corporate considerations.
Previous wording
Operational highlights during the three months ended March 31, 2025:
Current wording
Operational highlights during the three and six months ended June 30, 2025:
Previous wording
Our main sources of revenue are described below:
Current wording
Our main sources of revenue are described below. As a result of the variability of contract and service type, some of the revenue we report in each period is deferred revenue from contracts we entered into during previous periods. This may make it difficult for us to quickly increase revenue through the entry into new contracts in any period, and a decline in new or renewed contracts in any one quarter will negatively affect our revenue in future quarters. As a result, revenue generated in prior quarters may not provide a reliable indication of future results.
Previous wording
Customers pay for our managed IT security services on a subscription or contract-based model. Customers typically pay a recurring fee, which is generally based on service level agreements that define the specific services and performance metrics.
Current wording
Customers pay for our managed IT security services on a subscription or contract-based model. Customers typically pay a recurring fee, which is generally based on service level agreements that define the specific services and performance metrics. The unearned portion of managed IT security services revenue is presented as deferred revenue in our consolidated balance sheets.
Previous wording
Customers are invoiced for our professional services either based on a time and materials basis or on a straight-line basis for all fixed fee arrangements. We are the principal in these transactions as we control the specified good or service before it is transferred to the customer. Additionally, we are primarily responsible for fulfillment of the order and have pricing discretion. As a result, we recognize revenue from our professional services revenue on a gross basis.
Current wording
Customers are invoiced for our professional services either based on a time and materials basis or on a straight-line basis for all fixed fee arrangements. The unearned portion of professional services revenue is presented as deferred revenue in our consolidated balance sheets. We are the principal in these transactions, as we control the specified good or service before it is transferred to the customer. Additionally, we are primarily responsible for fulfillment of the order and have pricing discretion. As a result, we recognize revenue from our professional services revenue on a gross basis.
Previous wording
Our procurement services include either (i) obtaining software and hardware products on behalf of our customers, in which case our vendors drop ship the products to our end customer, or (ii) obtaining hardware or software on behalf of our customers and performing additional configuration and/or add additional inputs to the products before the products are shipped to our customer. For both types of procurement services each customer has their own negotiated contract and payment terms. If a customer orders both hardware and additional configurations to those laptops, typically these will both be covered under separate contracts. The services provided are considered distinct as the additional configurations are not required for the hardware purchased to operate effectively. Customers are invoiced, and revenue is recognized, when the hardware purchased is shipped, as control transfers to the customer free on board (“FOB”) shipping point. We are an agent in these transactions because we (i) do not obtain control over the product as products are drop shipped from their vendors directly to the customer; (ii) have no inventory risk and (iii) have general pricing discretion in our transactions with customers. Our pricing discretion is limited by the going market rate of our services offered by other providers. Based on this assessment, we recognize revenue from procurement services on a net basis.
Current wording
Our procurement services include either (i) obtaining software and hardware products on behalf of our customers, in which case our vendors drop ship the products to our end customer, or (ii) obtaining hardware or software on behalf of our customers and performing additional configuration and/or add additional inputs to the products before the products are shipped to our customer. For both types of procurement services, each customer has their own negotiated contract and payment terms. If a customer orders both hardware and additional configurations to those laptops, typically these will both be covered under separate contracts. The services provided are considered distinct, as the additional configurations are not required for the hardware purchased to operate effectively. Customers are invoiced, and revenue is recognized, when the purchased hardware is shipped, as control transfers to the customer free on board (“FOB”) shipping point. We are an agent in these transactions because we (i) do not obtain control over the product as products are drop shipped from their vendors directly to the customer; (ii) have no inventory risk and (iii) have general pricing discretion in our transactions with customers. Our pricing discretion is limited by the going market rate of our services offered by other providers. Based on this assessment, we recognize revenue from procurement services on a net basis.
Previous wording
Our secure private cloud offerings include a digital infrastructure which consists of servers which are dedicated to a single customer. We offer secure private cloud offerings through our Data Centers as well as off premise. Our secure private cloud offerings typically are one performance obligation where we are providing the cloud storage to the customer and customers pay a monthly fixed fee for the service.
Current wording
Our secure private cloud offerings include a digital infrastructure which consists of servers that are dedicated to a single customer. We offer secure private cloud offerings on-premise through our Data Centers as well as off-premise. Our secure private cloud offerings typically are one performance obligation where we are providing the cloud storage to the customer and customers pay a monthly fixed fee for the service.
Previous wording
When a cloud-based service includes both on-premises software licenses and cloud services, judgment is required to determine whether the software license is considered distinct and accounted for separately, or not distinct and accounted for together with the cloud service and recognized over time. Certain cloud services depend on a significant level of integration, interdependency, and interrelation between the desktop applications and cloud services, and are accounted for together as one performance obligation. Revenue from such cloud services is recognized ratably over the period in which the cloud services are provided.
Current wording
When a cloud-based service includes both on-premise software licenses and cloud services, judgment is required to determine whether the software license is considered distinct and, therefore, accounted for separately, or not distinct and, therefore, accounted for together with the cloud service and recognized over time. Certain cloud services depend on a significant level of integration, interdependency, and interrelation between the desktop applications and cloud services, and are accounted for together as one performance obligation. Revenue from such cloud services is recognized ratably over the period in which the cloud services are provided. The unearned portion of revenue from cloud services is presented as deferred revenue in our consolidated balance sheets.
Previous wording
We also generate subscription revenue from monthly premium subscription services for our ManyCam software. Subscription revenues are presented net of refunds, credits, and known and estimated credit card chargebacks. During the three months ended March 31, 2025 and 2024, subscriptions were offered in durations of twelve-month and twenty four-month terms. All subscription fees, however, are paid by credit card at the origination of the subscription regardless of the term of the subscription. Revenues from multi-month subscriptions are recognized on a straight-line basis over the period where the service is offered to the customer, indicated by length of the subscription term purchased. The unearned portion of subscription revenue is presented as deferred revenue in the accompanying condensed consolidated balance sheets.
Current wording
We also generate subscription revenue from monthly premium subscription services for our ManyCam software. Subscription revenues are presented net of refunds, credits, and known and estimated credit card chargebacks. During the three and six months ended June 30, 2025 and 2024, subscriptions were offered in durations of twelve-month and twenty four-month terms. All subscription fees, however, are paid by credit card at the origination of the subscription regardless of the term of the subscription. Revenues from multi-month subscriptions are recognized on a straight-line basis over the period where the service is offered to the customer, indicated by length of the subscription term purchased. The unearned portion of subscription revenue is presented as deferred revenue in the accompanying condensed consolidated balance sheets.
Previous wording
Cost of revenue consists primarily of compensation (including stock-based compensation) and other employee-related costs for personnel engaged in data center and customer care functions, credit card processing fees, hosting fees, data center rent, bandwidth costs and, in the case of procurement, revenue the cost of the hardware and/or subscriptions. Cost of revenue also includes compensation and other employee-related costs for technical personnel, consultants and subcontracting costs relating to technology service revenue.
Current wording
Cost of revenue consists primarily of compensation and other employee-related costs for personnel engaged in data center and customer care functions, credit card processing fees, hosting fees, data center rent, bandwidth costs and, in the case of procurement, revenue the cost of the hardware and/or subscriptions. Cost of revenue also includes compensation and other employee-related costs for technical personnel, consultants and subcontracting costs relating to technology service revenue.
Previous wording
General and administrative expense consists primarily of compensation (including non-cash stock-based compensation) and other employee-related costs for personnel engaged in executive management, finance, legal, tax and human resources and facilities costs and fees for other professional services and cost of insurance. General and administrative expense also includes amortization of intangible assets.
Current wording
General and administrative expense consists primarily of compensation (including non-cash stock-based compensation) and other employee-related costs for personnel engaged in executive management, finance, legal, tax and human resources and facilities costs and fees for other professional services and cost of insurance.
Previous wording
As described above in the “Recent Developments” section, during the three months ended March 31, 2025, we completed the Transactions. As a result, our historical financial condition and results of operations for the periods presented may not be comparable, either from period to period or going forward. For more information on the Transactions, see Note 3, Acquisition and Note 6, Discontinued Operations, in Part I, Item 1, Financial Statements, of this Form 10-Q.
Current wording
As described above in the “Recent Developments” section, we completed the Transactions in January 2025. As a result, our historical financial condition and results of operations for the periods presented may not be comparable, either from period to period or going forward. For more information on the Transactions, see Note 3,Acquisition and Note 6,Discontinued Operations, in Part I, Item 1, Financial Statements, of this Form 10-Q.
Previous wording
Our management relies on certain non-GAAP financial measures to manage and evaluate our business. The non-GAAP financial measures set forth below help us evaluate growth trends, establish budgets, measure the effectiveness of our advertising and marketing efforts and assess operational efficiencies. We also discuss net cash provided by operating activities under the “Liquidity and Capital Resources” section below. Adjusted EBITDA is discussed below.
Current wording
Our management relies on certain non-GAAP financial measures to manage and evaluate our business. The non-GAAP financial measures set forth below help us evaluate growth trends, establish budgets, measure the effectiveness of our advertising and marketing efforts and assess operational efficiencies. Adjusted EBITDA is discussed below. We also discuss net cash provided by operating activities under the “Liquidity and Capital Resources” section below.
Previous wording
Total revenue increased by 1931.9% to $5,518,038 for the three months ended March 31, 2025 from $271,572 for the three months ended March 31, 2024. This increase was driven by new revenue streams acquired in connection with the Acquisition and the fact that revenue for the prior year period did not include revenue from discontinued operations.
Current wording
Total revenue increased by 2008.5% to $5,722,599 for the three months ended June 30, 2025 from $271,409 for the three months ended June 30, 2024. This increase was driven by new revenue streams acquired in connection with the Acquisition and the fact that revenue for the prior year period did not include revenue from discontinued operations.
Previous wording
Our subscription revenue for the three months ended March 31, 2025 relates to the sales from our ManyCam software, which increased by $9,647, or 3.6%, as compared to the three months ended March 31, 2024. The increase in subscription revenue was primarily driven by an increase in new subscribers to our ManyCam software.
Current wording
Our subscription revenue for the three months ended June 30, 2025 relates to the sales from our ManyCam software, which increased by $7,220, or 2.7%, as compared to the three months ended June 30, 2024. The increase in subscription revenue was primarily driven by an increase in new subscribers to our ManyCam software.
Previous wording
Total costs and expenses for the three months ended March 31, 2025 increased by $5,575,384, or 436.7%, as compared to the three months ended March 31, 2024. The following table presents our costs and expenses for the three months ended March 31, 2025 and 2024, the increase between those periods and the percentage increase between those periods and the percentage of total revenue that each represented for those periods:
Current wording
Total costs and expenses for the three months ended June 30, 2025 increased by $5,529,838, or 418.1%, as compared to the three months ended June 30, 2024. The following table presents our costs and expenses for the three months ended June 30, 2025 and 2024, the increase between those periods and the percentage increase between those periods and the percentage of total revenue that each represented for those periods:
Previous wording
Our cost of revenue for the three months ended March 31, 2025 increased by $2,403,027, or 3898.7%, as compared to the three months ended March 31, 2024. This increase was primarily due to an increase in the expenses related to the new revenue streams, including but not limited to, costs associated with procurement equipment and related costs of $796,895, managed services expenses of $468,047, subscriptions and licensing of $480,278, professional and consulting costs of $363,764, web hosting expense of $154,751 and rent related to our Data Centers of $122,935.
Current wording
Our cost of revenue for the three months ended June 30, 2025 increased by $2,784,412, or 3812.3%, as compared to the three months ended June 30, 2024. This increase was primarily due to an increase in the expenses related to the new revenue streams, including but not limited to, costs associated with procurement equipment and related costs of $945,925, managed services expenses of $518,970, subscriptions and licensing of $698,846, professional and consulting costs of $278,498, web hosting expense of $123,455 and rent related to our Data Centers of $82,692.
Previous wording
Our sales marketing and product development expense for the three months ended March 31, 2025 increased by $499,575, or 188.0%, as compared to the three months ended March 31, 2024. The increase in sales marketing and product development expense for the three months ended March 31, 2024 was primarily due to an increase in salary-related expenses of approximately $512,897 and commissions of $132,915 earned by the Company’s sales team to service and grow its customer base. In addition, consulting expenses totaled $112,917 related to marketing activities. As a result of the Transactions, headcount increased from zero in the prior year period to approximately 15 people in the current period, and with their associated salary and salary-related costs are included in sales marketing and product development expense for the three months ended March 31, 2025.
Current wording
Our sales marketing and product development expense for the three months ended June 30, 2025 increased by $581,999 or 226.1%, as compared to the three months ended June 30, 2024. The increase in sales marketing and product development expense for the three months ended June 30, 2025 was primarily due to an increase in salary-related expenses of approximately $510,333 and commissions of $134,844 earned by the Company’s sales team to service and grow its customer base. In addition, consulting expenses totaled $134,542 related to marketing activities. As a result of the Transactions, headcount on our sales team increased from zero in the prior year period to approximately 15 people in the current period, and their associated salaries are included in sales marketing and product development expense for the three months ended June 30, 2025.
Previous wording
Non-operating income for the three months ended March 30, 2025 was $82,392, a decrease of $69,592, or 45.8%, as compared to non-operating income of $151,984 for the three months ended March 31, 2024. The decrease was primarily a result of a decrease in the amount of principal the Company invested and at varying interest rates.
Current wording
Non-operating income for the three months ended June 30, 2025 was $151,678, a decrease of $138,822, or 47.8%, as compared to non-operating income of $290,500 for the three months ended June 30, 2024. The decrease in interest income was primarily a result of a decrease in the amount of principal the Company invested and at varying interest rates. Other income for the three months ended June 30, 2025 related to the sale of a domain name that the Company is not using. During the three months ended June 30, 2024 other income included proceeds from a class action lawsuit against a service provider.
Previous wording
Our general and administrative expense for the three months ended March 31, 2025 increased by $2,194,324, or 295.1%, as compared to the three months ended March 31, 2025. The increase in general and administrative expenses for the three months ended March 31, 2025 was primarily due to legal and accounting expenses of $269,415 and $264,993, respectively. In addition, the Company incurred public company expenses of $87,698, rent expense of $103,460 in connection with our office and Data Centers, insurance costs of $200,185. Salary and salary related expenses totaled $1,530,551 for the three months ended March 31, 2025, plus $167,631 of non-cash share-based compensation. As a result of the Transactions, headcount increased from four individuals in the prior year period to approximately 41 individuals in the current period, and their associated salary and salary related costs are included in general and administrative expenses for the three months ended March 31, 2025. Of the total expenses described above, approximately $334,970 were one-time expenses related to the Transactions.
Current wording
Our general and administrative expense for the six months ended June 30, 2025 increased by $3,889,683, or 254.2%, as compared to the six months ended June 30, 2024. The increase in general and administrative expenses for the three months ended June 30, 2025 was primarily due to legal and accounting expenses of $417,901 and $342,724, respectively. In addition, the Company incurred public company expenses of $203,285, rent expense of $198,647 in connection with our office and Data Centers and insurance costs of $405,596. Salary and salary related expenses totaled $3,065,134 for the six months ended June 30, 2025, plus $245,391 of non-cash share-based compensation. As a result of the Transactions, headcount increased from four individuals in the prior year period to approximately 41 individuals in the current period, and their associated salary and salary related costs are included in general and administrative expenses for the six months ended June 30, 2025. Of the total expenses described above, approximately $334,970 were one-time expenses related to the Transactions.
Previous wording
Our provision for income taxes consists of federal, foreign and state taxes, as applicable, in amounts necessary to align the Company’s year-to-date tax provision with the effective rate that it expects to achieve for the full year. For the three months ended March 31, 2025, the Company recorded an income tax benefit of $2,060,065 primarily related to a partial release of its valuation allowance as the Acquisition of NTS created a source of future taxable income allowing for the recognition of certain deferred tax assets. For the three months ended March 31, 2024, the Company recorded an income tax benefit of $598,710, consisting primarily of federal, foreign, state and local taxes.
Current wording
Our provision for income taxes consists of federal, foreign and state taxes, as applicable, in amounts necessary to align the Company’s year-to-date tax provision with the effective rate that it expects to achieve for the full year. For the six months ended June 30, 2025, the Company recorded an income tax benefit of $1,988,058 primarily related to a partial release of its valuation allowance as the Acquisition created a source of future taxable income allowing for the recognition of certain deferred tax assets. For the six months ended June 30, 2024, the Company recorded an income tax benefit of $66,208, consisting primarily of federal, foreign, state and local taxes.
Previous wording
We believe that our cash and cash equivalents balance, our cash available through the Facility and our expected cash flows from operations will be sufficient to meet all of our financial obligations for one year from the date these financial statements are issued. As of March 31, 2025, we had $9,683,317 of cash and cash equivalents.
Current wording
We believe that our cash and cash equivalents balance, our cash available through the Facility and our expected cash flows from operations will be sufficient to meet all of our financial obligations for one year from the date these financial statements are issued. As of June 30, 2025, we had $8,301,692 of cash and cash equivalents, which included $1,014,714 of restricted cash.
Previous wording
Our primary use of working capital is related to product development resources and investment in marketing initiatives to grow the business in order to maintain and create new services and features in applications for our clients and users. In the future, we may seek to grow our business by expending our capital resources to fund strategic acquisitions, investments and partnership opportunities.
Current wording
Our primary use of working capital is related to investment in marketing initiatives to grow the business in order to maintain and create new services and features in applications for our clients and users. In the future, we may seek to grow our business by expending our capital resources to fund strategic acquisitions, investments and partnership opportunities.
Previous wording
On May 8, 2025, the Board approved the Stock Repurchase Plan for up to $400,000 of our outstanding common stock, which expires on the one-year anniversary of such date. We intend to utilize the Stock Repurchase Plan to minimize the dilutive impact of awards granted under our equity incentive plans and to repurchase shares opportunistically. Shares of common stock may be repurchased from time to time in open market transactions at prevailing market prices, in privately negotiated transactions or by other means in accordance with federal securities laws, including Rule 10b5-1 plans. The Stock Repurchase Plan does not obligate us to repurchase any shares of common stock, and the Stock Repurchase Plan may be modified, suspended, extended or terminated at any time by our Board. The actual timing, number and value of shares repurchased will be determined by a committee of the Board at its discretion and will depend on a number of factors, including the market price of our common stock, general market and economic conditions, alternative investment opportunities and other corporate considerations. As of the date of this report, no shares of common stock had been repurchased pursuant to the Stock Repurchase Plan.
Current wording
On May 8, 2025, the Board approved the Stock Repurchase Plan for up to $400,000 of our outstanding common stock, which expires on the one-year anniversary of such date. We intend to utilize the Stock Repurchase Plan to minimize the dilutive impact of awards granted under our equity incentive plans and to repurchase shares opportunistically. Shares of common stock may be repurchased from time to time in open market transactions at prevailing market prices, in privately negotiated transactions or by other means in accordance with federal securities laws, including Rule 10b5-1 plans. The Stock Repurchase Plan does not obligate us to repurchase any shares of common stock, and the Stock Repurchase Plan may be modified, suspended, extended or terminated at any time by our Board. The actual timing, number and value of shares repurchased will be determined by a committee of the Board at its discretion and will depend on a number of factors, including the market price of our common stock, general market and economic conditions, alternative investment opportunities and other corporate considerations. As of June 30, 2025, 104,600 shares of common stock had been repurchased pursuant to the Stock Repurchase Plan.
Previous wording
Net cash provided by operating activities was $1,744,783 for the three months ended March 31, 2025, as compared to net cash used in operating activities of $335,786 for the three months ended March 31, 2024. The improvement in the amount of cash used in operations for the three months ended March 31, 2024 was primarily attributed to the change in the business activities of the Company following the Transactions compared to the three months ended March 31, 2024, specifically, the collection of accounts receivable (favorable by $0.2 million), the timing of payment of payables favorable by $0.7 million, as well as amounts collected by the Company during the first quarter following the Divestiture due to Meteor Mobile and paid subsequent to quarter end of $0.4 million.
Current wording
Net cash provided by operating activities was $856,105 for the six months ended June 30, 2025, as compared to net cash used in operating activities of $103,210 for the six months ended June 30, 2024. The increase in the amount of cash provided by operations for the six months ended June 30, 2024 was primarily attributed to the change in the business activities of the Company following the Transactions compared to the six months ended June 30, 2024, specifically, the collection of accounts receivable (favorable by $0.3 million), and the timing of payment of payables (favorable by $1.5 million), netted against amounts collected by the Company during the second quarter following the Divestiture due to Meteor Mobile and paid subsequent to quarter end of $0.4 million.
Previous wording
Net cash used in investing activities for the three months ended March 31, 2025 was $4,000,000 and related to the cash consideration paid by the Company to Newtek in connection with the Acquisition. There was no cash used in or provided by investing activities for the three months ended March 31, 2024.
Current wording
Net cash used in investing activities for the six months ended June 30, 2025 was $4,280,149 and related to the cash consideration paid by the Company to Newtek in connection with the Acquisition as well as the acquisition of fixed assets. There was no cash used in or provided by investing activities for the six months ended June 30, 2024.
Previous wording
Net cash provided by financing activities was $1,350,000 for the three months ended March 31, 2025. There was no cash used in or provided by financing activities for the three months ended March 31, 2024. This is attributed to the $1,350,000 received in connection with the Divestiture.
Current wording
Net cash provided by financing activities was $1,137,202 for the six months ended June 30, 2025, which was attributed to the $1,350,000 received in connection with the Divestiture netted against the $212,798 used in connection with the Stock Repurchase Plan. There was no cash used in or provided by financing activities for the six months ended June 30, 2024.
Rearranged current paragraphs (9)
Current report — wording carried from elsewhere
Our general and administrative expense for the three months ended June 30, 2025 increased by $1,695,359, or 215.6%, as compared to the three months ended June 30, 2024. The increase in general and administrative expenses for the three months ended June 30, 2025 was primarily due to legal and accounting expenses of $148,486 and $73,327, respectively. In addition, the Company incurred public company expenses of $115,586, rent expense of $95,187 in connection with our office and Data Centers and insurance costs of $205,411. Salary and salary related expenses totaled $1,534,583 for the three months ended June 30, 2025, plus $77,760 of non-cash share-based compensation. As a result of the Transactions, headcount increased from four individuals in the prior year period to approximately 41 individuals in the current period, and their associated salary and salary related costs are included in general and administrative expenses for the three months ended June 30, 2025.
Current report — wording carried from elsewhere
Our provision for income taxes consists of federal, foreign and state taxes, as applicable, in amounts necessary to align the Company’s year-to-date tax provision with the effective rate that it expects to achieve for the full year. For the three months ended June 30, 2025, the Company recorded an income tax provision of $72,007 consisting primarily of federal, foreign, state and local taxes. For the three months ended June 30, 2024, the Company recorded an income tax provision of $532,502, consisting primarily of federal, foreign, state and local taxes.
Current report — wording carried from elsewhere
Total revenue increased by 1970.2% to $11,240,637 for the six months ended June 30, 2025 from $542,981 for the six months ended June 30, 2024. This increase was driven by new revenue streams acquired in connection with the Acquisition and the fact that revenue for the prior year period did not include revenue from discontinued operations.
Current report — wording carried from elsewhere
The following table sets forth our total revenue for the six months ended June 30, 2025 and the six months ended June 30, 2024, the increase between those periods, the percentage increase between those periods, and the percentage of total revenue that each represented for those periods:
Current report — wording carried from elsewhere
Our subscription revenue for the six months ended June 30, 2025 relates to the sales from our ManyCam software, which increased by $16,867, or 3.1%, as compared to the six months ended June 30, 2024. The increase in subscription revenue was primarily driven by an increase in new subscribers to our ManyCam software.
Current report — wording carried from elsewhere
Our cost of revenue for the six months ended June 30, 2025 increased by $5,187,439, or 3,851.9%, as compared to the six months ended June 30, 2024. This increase was primarily due to an increase in the expenses related to the new revenue streams, including but not limited to, costs associated with procurement equipment and related costs of $1,723,423, managed services expenses of $987,017, subscriptions and licensing of $1,179,124, professional and consulting costs of $642,242, web hosting expense of $278,206 and rent related to our Data Centers of $165,384.
Current report — wording carried from elsewhere
Sales marketing and product development expense
Current report — wording carried from elsewhere
Our sales marketing and product development expense for the six months ended June 30, 2025 increased by $1,081,574, or 206.7%, as compared to the six months ended June 30, 2024. The increase in sales marketing and product development expense for the six months ended June 30, 2025 was primarily due to an increase in salary-related expenses of approximately $1,020,875 and commissions of $267,759 earned by the Company’s sales team to service and grow its customer base. In addition, consulting expenses totaled $247,459 related to marketing activities. As a result of the Transactions, headcount on our sales team increased from zero in the prior year period to approximately 15 people in the current period, and their associated salary costs are included in sales marketing and product development expense for the six months ended June 30, 2025.
Current report — wording carried from elsewhere
The following table presents the components of non-operating income for the six months ended June 30, 2025 and the six months ended June 30, 2024, the decrease between those periods, the percentage decrease between those periods and the percentage of total revenue that each represented for those periods:
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Our revenue is measured based on the consideration specified in a contract with a customer. Our contracts with customers often include promises to transfer multiple products and services. Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment. When a cloud-based service includes both on-premises software licenses and cloud services, judgment is required to determine whether the software license is considered distinct and accounted for separately, or not distinct and accounted for together with the cloud service and recognized over time. Certain cloud services depend on a significant level of integration, interdependency, and interrelation between the desktop applications and cloud services, and are accounted for together as one performance obligation. Revenue from cloud services is recognized ratably over the period in which the cloud services are provided. We otherwise recognize revenue when it satisfies a performance obligation by transferring control of a product or service or by arranging for the sale of a vendor’s products or service to a customer.