GIFTIFY, INC.
For the period ended Dec 31, 2025. Filed Mar 18, 2026.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Mar 18, 2026
GIFT$0.51-2.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-03-31.
0001641172-25-001500
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-03-18.
0001493152-26-010887
Item 7. 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 124 previous paragraphs and 116 current paragraphs.
48 unchanged; 39 reworded; 28 added; 37 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 12 previous and 9 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 (28)
Current report
On May 29, 2025, the Company acquired Takeout7 Inc. Takeout7 is a restaurant technology company offering comprehensive online ordering solutions through its TakeOut7 platform and AI-powered digital marketing services through its Platr platform. The acquisition of Takeout7 expands the Company’s technology offerings to include end-to-end solutions for independent restaurants. In early 2026, Takeout7 and its operations were merged into our subsidiary, Restaurant.com, Inc.
Current report
How We Measure Our Business
Current report
We use operating metrics to assess our business’s progress and make strategic decisions. Certain financial metrics are reported in accordance with GAAP, and others are non-GAAP financial measures. As our business evolves, we may update the key financial and operating metrics we use to measure our performance. For further information and reconciliations to the most applicable financial measures under GAAP, refer to our discussion under the Non-GAAP Financial Measures section.
Current report
Operating Metrics
Current report
A reconciliation of our net sales (as reported) to our gross billings for the years ended December 31, 2025 and 2024 were as follows:
Current report
We recognize revenue in accordance with FASB ASC 606,Revenue from Contracts with Customers. Based on the Company’s business model, it is sometimes necessary to determine whether we are acting as a principal or an agent in revenue-generating arrangements.
Current report
Deciding whether the Company is a principal or an agent requires significant judgment and analysis. This is particularly true when evaluating factors such as responsibility for fulfilling the customer promise, inventory risk, and pricing discretion. Changes in the assessment of these indicators could materially impact reported revenue and related metrics. The Company continuously evaluates our judgments and estimates to ensure accurate revenue recognition in accordance with ASC 606.
Current report
The following table reconciles the recording of the Company’s gross vs. net transactions to the Company’s reported net sales.
Current report
The increase in net revenue recognized as agent increased $2,742,407, or 126.1%, during the year ended December 31, 2025, as compared to the prior year period. The increase over the previous year was due to the sale of cruise-line-related gift cards, fluctuations in the types of gift cards sold, and changes in the number of customer orders in which the Company acted as an agent.
Current report
Operating Metrics
Current report
Our gross billings for the year ended December 31, 2025 and 2024 were as follows:
Current report
Gross billings increased 27.1% during the year ended December 31, 2025, as compared to the prior year period. A significant portion of our revenue comes from discounted merchant gift card sales, in which we collect the transaction price from the customer and remit a portion to third-party suppliers of the related goods or services. For these transactions, gross billings differ from the Net Sales reported in our Consolidated Statements of Operations, which reflect only the fees and commissions we retain from the sale of discounted merchant gift cards.
Current report
Financial Results
Current report
The following is a discussion of our results of operations.
Current report
Net sales for the year ended December 31, 2025 and 2024, were $83,181,716 and $88,934,036, respectively, a decrease of 6.5%. The decrease in net sales was due to the change in the mix of agent versus principal transactions as discussed above. Merchant gift card sales accounted for approximately 97% and 98% of our net sales for the year ended December 31, 2025 and 2024, respectively.
Current report
Selling, general and administrative expenses were $22,933,052 for the year ended December 31, 2025, as compared to $27,615,865 for the year ended December 31, 2024, a decrease of $4,682,813. The decrease was due to a $5,182,023 reduction in stock-based compensation expense during the year ended December 31, 2025, partially offset by increases in payroll and benefits expenses, marketing and advertising costs, and other general expenses to support our business.
Current report
Other Expenses, Net
Current report
For the year ended December 31, 2025, we incurred interest expense, net of $604,759, as compared to interest expense, net of $1,002,354 for the year ended December 31, 2024. The decrease in interest expense was due to our decreased debt balances. We recorded financing costs of $95,000 for the year ended December 31, 2025 as compared to $131,000 for the prior year period. Lastly, we recorded additional income of $38,540 for the year ended December 31, 2025, which did not occur in the prior year period.
Current report
Income Tax Benefit
Current report
For the year ended December 31, 2025, we recognized an income tax benefit of $508,796, compared with $677,000 for the year ended December 31, 2024.
Current report
Non-GAAP Financial Measure - Modified EBITDA
Current report
As reflected in the accompanying financial statements, for the year ended December 31, 2025, the Company recorded a net loss of $10,491,658 and used cash in operations of $1,590,074. Cash used in operations was primarily for working capital. As of December 31, 2025, we had a cash balance of $3,654,944.
Current report
Historically, we have financed our operations through existing cash balances, public and private issuance of common stock, term loans, and credit lines from financial institutions.
Current report
As of the issuance date of the financial statements included in this Annual Report on Form 10-K, management expects that the Company’s existing cash of $3,654,944 will last until December 2026.
Current report
To address funding considerations, management periodically evaluates funding alternatives and may raise additional funds through equity issuances, debt securities, strategic partner arrangements, strategic transactions, or credit from financial institutions. As we seek additional financing, there is no assurance that such financing will be available to us on favorable terms, or at all. Our ability to obtain additional financing in the debt and equity capital markets is subject to several factors, including market and economic conditions, our performance, and investor sentiment regarding us and our industry.
Current report
We are also continuing to take actions to improve the Company’s operating performance and cash generated from operations, including product optimization, sales growth strategies, operational streamlining, negotiating equitable vendor contracts, and managing product pricing. However, we may be unable to execute these actions in a timely manner, or at all.
Current report
If the Company is unable to raise additional capital whenever necessary or otherwise improve its operating performance or generation of cash from operations, it may be forced to decelerate or curtail certain of its operations until such time as additional capital becomes available.
Current report
Revenue Recognition
Removed paragraphs (37)
Previous report
Basis of Presentation
Previous report
On August 18, 2023, Giftify, Inc. entered into an agreement and plan of merger to acquire CardCash Exchange Inc (“CardCash”). On December 29, 2023, the merger was completed. Giftify’s operations are not considered significant compared to the operations of CardCash before the acquisition. Accordingly, for the purpose of the accompanying consolidated financial statements, periods before December 29, 2023 reflect the financial position, results of operations and cash flows of CardCash prior to the acquisition, and is referred to as the “Predecessor”. Periods beginning after December 29, 2023 reflect the financial position, results of operations and cash flows of Giftify consolidated with CardCash, and is referred to as the “Successor”. A black-line between the Successor and Predecessor periods has been placed in the consolidated financial statements and in the tables to the notes to the consolidated financial statements to highlight the lack of comparability between these periods. Collectively, Giftify (Successor) and CardCash (Predecessor) are referred to as the “Company”.
Previous report
**GIFTIFY, INC. AND SUBSDIARIES (FKA RDE, INC.)
Previous report
For the year ended December 31, 2023, the Company’s operating revenues consisted of sales generated by our CardCash business. See our Basis of Presentation discussion above.
Previous report
CardCash
Previous report
Sales for the year ended December 31, 2024 and 2023, were $86,991,638 and $87,146,804, respectively. During the current year period, we focused on improving our gross margin. We assessed the quality of our purchased gift card brands, allowing us to increase the sales price to our customers, resulting in a gross margin of 13.0%, as compared to a gross margin of 12.0% in the prior year period, which generated an increase in gross profit as compared to the prior year period.
Previous report
Restaurant.com
Previous report
Sales for the year ended December 31, 2024 were $1,942,399. Per our Basis of Presentation discussion above, Restaurant.com sales were not included in the prior year numbers.
Previous report
For the year ended December 31, 2023, the Company’s cost of sales consisted of solely our CardCash business. See our Basis of Presentation discussion above. Amortization of developed technology is excluded from cost of sales and included in amortization expense in the Statements of Operations.
Previous report
CardCash
Previous report
Restaurant.com
Previous report
Cost of sales for the year ended December 31, 2024 were $134,565. Per our Basis of Presentation discussion above, Restaurant.com sales were not included in the prior year numbers.
Previous report
Selling, general and administrative expenses.
Previous report
Selling, general and administrative expenses were $27,615,865 for the year ended December 31, 2024, as compared to $16,238,938 for the year ended December 31, 2023, an increase of $11,376,927. The increase was from increased stock-based compensation expense of $6,482,766 during the year ended December 31, 2024, increased payroll and benefit expenses, and general changes in our business and operations. For the period January 1, 2023 to December 29, 2023, selling, general and administrative expenses of Giftify were excluded. See our Basis of Presentation discussion above.
Previous report
Impairment of property and equipment.
Previous report
During the year ended December 31, 2023, the Company determined that certain property and equipment were impaired, resulting in a charge to operations of $738,740 at December 31, 2023. No similar event occurred in the current year period.
Previous report
Impairment of intangibles
Previous report
During the year ended December 31, 2023, the Company determined that certain intangible assets were impaired, based on a third-party valuation, resulting in a charge to operations of $250,000 at December 31, 2023. No similar event occurred in the current year period.
Previous report
Other Income (Expenses)
Previous report
We had other expenses of ($1,133,354) for the year ended December 31, 2024, as compared to other income of $2,985,534 for the year ended December 31, 2023. Other expense income for the year ended December 31, 2024, consisted of financing costs of $131,000 and interest expense of $1,002,354. Other income for the year ended December 31, 2023, consisted of a gain from the forgiveness of convertible notes and promissory notes totaling $5,876,000, offset by interest expense of $2,890,466.
Previous report
Modified EBITDA
Previous report
For the year ended December 31, 2023, cash provided by financing activities was $1,462,376, which was from net proceeds received from our line of credit facility of $1,212,376, and a $250,000 working capital advance from Giftify.
Previous report
Secured Revolving Line of Credit
Previous report
In November 2020, CardCash entered into an amended and restated promissory note for a revolving line of credit with availability of up to $10,000,000. The revolving line of credit is payable on demand, secured by the Company’s inventory, with interest based on the Wall Street Journal Prime Rate plus 3.00%, limited to a floor of 6.5%. At December 31, 2024 and December 31, 2023, the average interest rate was 12% and 12%, respectively. As of December 31, 2024, the Company was in compliance with customary debt covenants. As of December 31, 2024, the line of credit balance was $3,805,080, and this line of credit requires a deposit of $1,258,826, which is included in restricted cash.
Previous report
Convertible Debt
Previous report
On November 5, 2018, the Company completed the acquisition of Incumaker, Inc. and assumed certain outstanding convertible notes payable. At December 31, 2024, there was one remaining assumed convertible note payable outstanding that matured July 2017. The Company continues to be unsuccessful in reaching the Note holder to remit payment in full. At December 31, 2024, the principal balance of $20,000, and accrued interest of $23,137, are convertible at $1.50 per share into 28,758 shares of the Company’s common stock.
Previous report
Secured Note Payable
Previous report
On February 19, 2025, the Company entered into a secured promissory note (the “Note”) with Real World Digital Assets LLC (“Real World”) in the principal amount of $1,000,000 bearing annual interest of 11.5% that had a maturity date of December 31, 2025. The Note is collateralized by a blanket lien on the assets of Giftify under the terms of a Security Agreement and is subordinated only to the line of credit owed by Company to Pathward National Association.
Previous report
Notes Payable
Previous report
CardCash Acquisition Notes Payable
Previous report
On December 29, 2023, the Company issued two-year promissory notes totaling $1,500,000 as partial consideration for the acquisition of CardCash (see Note 3). $750,000 is payable on December 29, 2024 (see Note 13), bearing simple annual interest of 5%, and $750,000 is to be paid upon the earlier of (a) the completion of a firm commitment underwriting the Company’s initial public offering to allow the Company to become listed on the Nasdaq Capital Market or (b) December 29, 2025. As of December 31, 2023, the notes payable had an aggregate principal balance outstanding of $1,500,000. As of December 31, 2024, the notes payable had an aggregate principal balance outstanding of $1,500,000 and accrued interest payable of $75,000.
Previous report
GameIQ Acquisition Note Payable
Previous report
On February 1, 2022, the Company issued two notes payable for the purchase of GameIQ, one for $78,813 and another for $62,101. In accordance with Notes, the Company promised to pay the principal together with interest at 1% upon the earlier of (i) nine equal biannual installments with the first installment due on October 1, 2022, and the final payment due February 1, 2025 (the “Maturity Date”).
Previous report
As of December 31, 2023, the notes payable had an aggregate principal balance outstanding of $102,199 and accrued interest payable of $821. As of December 31, 2024, the notes payable had an aggregate principal balance outstanding of $75,928 and accrued interest payable of $1,646.
Previous report
Economic Injury Disaster Loans (EIDL)
Previous report
On June 17, 2020, the Company received $150,000 of proceeds applicable to loans administered by the SBA as disaster loan assistance under the Covid-19 Economic Injury Disaster Loan (EIDL) Program. On July 14, 2021, the Company received an additional $350,000 of proceeds pursuant to the loan. On July 21, 2020, the Company received $150,000 of proceeds applicable to loans administered by the SBA as disaster loan assistance under the Covid-19 EIDL Program. On January 31, 2022, the Company assumed an additional $14,500 EIDL, and accrued interest of $900, as part of the consideration paid for the acquisition of GameIQ.
Previous report
The loans bear interest at 3.75% per annum, with a combined repayment of principal and interest of $3,500 per month beginning 12 months from the date of the promissory note over a period of 30 years. As of December 31, 2023, the note payable had a principal balance outstanding of $664,500 and accrued interest payable of $27,259. As of December 31, 2024, the note payable had a principal balance outstanding of $664,500 and accrued interest payable of $15,558.
Reworded paragraphs (39)
Previous wording
The following discussion and analysis of the financial condition and results of operations of Giftify should be read together with our consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K. The following discussion and analysis should also be read together with the section entitled “Organization and description of business” as of December 31,2024 and 2023(Successor)and for the period from January 1, 2023 through December 29, 2023 (Predecessor). In addition to historical information, the following discussion and analysis contains forward-looking statements. Our actual results may differ significantly from those projected in such forward-looking statements. Factors that might cause future results to differ materially from those projected in such forward-looking statements include, but are not limited to, those discussed in the sections entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements.” All figures are presented in thousands, except percentages, rates and unless otherwise noted.
Current wording
The following discussion and analysis of the financial condition and results of operations of Giftify should be read together with our consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K. In addition to historical information, the following discussion and analysis contains forward-looking statements. Our actual results may differ significantly from those projected in such forward-looking statements. Factors that might cause future results to differ materially from those projected in such forward-looking statements include, but are not limited to, those discussed in the sections entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements.” All figures are presented in thousands, except percentages, rates and unless otherwise noted.
Previous wording
On August 18, 2023, we entered into an agreement and plan of merger to acquire CardCash Exchange Inc (“CardCash”). On December 29, 2023, the merger was completed and has been accounted for as a business combination using the acquisition method of accounting. CardCash was formed in 2013 and purchases merchant gift cards and resells them at a markup.
Current wording
On August 18, 2023, we entered into an agreement and plan of merger to acquire CardCash Exchange Inc (“CardCash”). On December 29, 2023, the merger was completed and accounted for as a business combination under the acquisition method. CardCash was formed in 2013 and purchases merchant gift cards and resells them at a markup.
Previous wording
CardCash operates as a leading gift card exchange platform, facilitating the purchase and sale of unwanted gift cards at discounted rates for both consumers and businesses. The Company’s mission is to provide a seamless marketplace for individuals looking to maximize the value of their gift cards while also offering businesses innovative solutions to leverage this market.
Current wording
CardCash is a leading gift card exchange platform that facilitates the purchase and sale of unwanted gift cards at discounted rates for consumers and businesses. The Company’s mission is to provide a seamless marketplace for individuals looking to maximize the value of their gift cards while also offering businesses innovative solutions to leverage this market.
Previous wording
CardCash’s core service offering includes the buying and selling of gift cards from over 1,100 retailers, such as Target, Home Depot, Starbucks and TJ Maxx, among others. By connecting buyers and sellers, CardCash enables consumers to unlock value from unused gift cards and save significant amounts on their purchases.
Current wording
CardCash’s core service offering includes buying and selling gift cards from over 1,100 retailers, including Target, Home Depot, Starbucks, and TJ Maxx. By connecting buyers and sellers, CardCash enables consumers to unlock value from unused gift cards and save significant amounts on their purchases.
Previous wording
CardCash purchases unwanted gift cards at a value lower than their face worth and subsequently retails them at a discounted rate to discerning shoppers nationwide. This avenue not only allows individuals to obtain cash for their unneeded gift cards but also enables them to make cost-effective purchases through discounted gift cards.
Current wording
CardCash purchases unwanted gift cards at a discount to their face value and resells them at a discount to discerning shoppers nationwide. This avenue not only allows individuals to redeem unwanted gift cards for cash but also enables them to make cost-effective purchases with discounted gift cards.
Previous wording
With advanced fraud prevention technology, known as FraudFix, CardCash ensures the security and integrity of all transactions conducted on its platform. This commitment to trust and reliability has contributed to its success in saving consumers over $100 million since its inception.
Current wording
With advanced fraud-prevention technology, FraudFix, CardCash ensures the security and integrity of all transactions on its platform. This commitment to trust and reliability has contributed to its success in saving consumers over $100 million since its inception.
Previous wording
Our B2C division accounted for approximately 50% of gross revenue in our fiscal year ended December 31, 2024. To our database of 6.2 million customers, we sell:
Current wording
Our B2C division accounted for approximately 15% of gross revenue in our fiscal year ended December 31, 2025. To our database of 6.2 million customers, we sell:
Previous wording
● “Specials by Restaurant.com” which bundle Restaurant.com certificates with a variety of other entertainment options, including theatre, movies, wine and travel. Customers have favored these bundled offering (“Specials”), generating significantly greater revenue per customer when compared to purchasing our other products. The average order value for these Specials sales is nearly five times a certificate purchase. Specials generated over 5% of our past year’s B2C revenue from 60% of the B2C orders for the fiscal year ended December 31, 2023. We believe that our relationships with small businesses presents a significant revenue opportunity through such cross-promotions.
Current wording
● “Specials by Restaurant.com,” which bundle Restaurant.com certificates with a variety of other entertainment options, including theatre, movies, wine, and travel. Customers have favored these bundled offerings (“Specials”), generating significantly higher revenue per customer than purchasing our other products. The average order value for these Specials sales is nearly five times that of a certificate purchase. Specials generated over 5% of our past year’s B2C revenue from 60% of the B2C orders for the fiscal year ended December 31, 2023. We believe that our relationships with small businesses present a significant revenue opportunity through such cross-promotions.
Previous wording
Our B2B division accounted for approximately 50% of our gross revenue in our fiscal year ended December 31, 2023. We sell certificates and Discount Dining Passes to corporations and marketers, which use them to:
Current wording
Our B2B division accounted for approximately 85% of our gross revenue in our fiscal year ended December 31, 2025. We sell certificates and Discount Dining Passes to corporations and marketers, which use them to:
Previous wording
We also generate revenue through third-party offers and display ad revenue. This comprises a de minimis portion of our gross revenue.
Current wording
We also generate revenue from third-party offers and display ads. This comprises a de minimis portion of our gross revenue.
Previous wording
We intend to grow and leverage our customer database of 6.2 million which we believe is of value to merchants for a variety of services and products.
Current wording
We intend to grow and leverage our 6.2 million customer database, which we believe is valuable to merchants for a variety of services and products.
Previous wording
In March 2020, the World Health Organization declared COVID-19 a global pandemic. This contagious disease outbreak, adversely affected work forces, economies and financial markets globally. The outbreak has negatively impacted our revenues as a result of the temporary closures of restaurants throughout the United States where our discount certificates and Discount Dining Passes were accepted and where dining was being restricted to outdoor locations or to capacity constraints for indoor dining. Our revenues from purchase of our discount certificates in 2020, 2021 and 2022 declined since they could only be redeemed when dining in the restaurants and also were not accepted for payment by third-party platforms that facilitated ordering and delivery of food on-demand. As the COVID-19 pandemic has abated, our revenues improved in fiscal 2023.
Current wording
In March 2020, the World Health Organization declared COVID-19 a global pandemic. This contagious disease outbreak adversely affected workforces, economies, and financial markets globally. The outbreak has negatively impacted our revenues due to temporary restaurant closures across the United States, where our discount certificates and Discount Dining Passes were accepted, and where dining was restricted to outdoor locations or to capacity limits for indoor dining. Our revenues from the purchase of our discount certificates in 2020, 2021, and 2022 declined since they could only be redeemed when dining in the restaurants and also were not accepted for payment by third-party platforms that facilitated ordering and delivery of food on demand. As the COVID-19 pandemic has abated, our revenues improved in fiscal 2023.
Previous wording
Global inflation also increased during 2021 and in 2022. The Russia and Ukraine conflict and other geopolitical conflicts, as well as related international response, have exacerbated inflationary pressures, including causing increases in the price for goods and services and global supply chain disruptions, which have resulted and may continue to result in shortages in food products, materials and services. Such shortages have resulted and may continue to result in inflationary cost increases for labor, fuel, food products, materials and services, and could continue to cause costs to increase as well as result in the scarcity of certain materials. We cannot predict any future trends in the rate of inflation or other negative economic factors or associated increases in our operating costs and how that may impact our business. To the extent we and the restaurant customers we service are unable to recover higher operating costs resulting from inflation or otherwise mitigate the impact of such costs on our and their business, our revenues and gross profit could decrease, and our financial condition and results of operations could be adversely affected.
Current wording
The Russia and Ukraine conflict and other geopolitical conflicts, as well as related international response, have exacerbated inflationary pressures, including causing increases in the price for goods and services and global supply chain disruptions, which have resulted and may continue to result in shortages in food products, materials and services. Such shortages have resulted and may continue to result in inflationary cost increases for labor, fuel, food products, materials and services, and could continue to cause costs to increase as well as result in the scarcity of certain materials. We cannot predict future trends in inflation or other negative economic factors, or the associated changes in our operating costs, and how these may impact our business. To the extent we and the restaurant customers we service are unable to recover higher operating costs resulting from inflation or otherwise mitigate the impact of such costs on our and their business, our revenues and gross profit could decrease, and our financial condition and results of operations could be adversely affected.
Previous wording
The Company has a history of reporting net losses. At December 31, 2024, the Company had cash of $3,574,876 available to fund its operations, including expansion plans, and to service its debt, and a negative working capital of $3,204,077.
Current wording
The Company has a history of reporting net losses. As of December 31, 2025, the Company had $3,654,944 in cash available to fund its operations, including expansion plans, and to service its debt, and working capital of $249,223.
Previous wording
Our consolidated financial statements have been presented on the basis that it will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. We have experienced operating losses and negative operating cash flows during 2024 and 2023. We have financed our working capital requirements through borrowings from various sources and the sale of our equity securities.
Current wording
Our consolidated financial statements have been presented on the basis that it will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. We incurred operating losses and negative operating cash flows in 2025 and 2024. We have financed our working capital requirements through borrowings from various sources and the sale of our equity securities.
Previous wording
As a result, management has concluded that there is substantial doubt about our ability to continue as a going concern. The Company’s independent registered public accounting firm, in its report on the Company’s consolidated financial statements for the year ended December 31, 2024, has also expressed substantial doubt about the Company’s ability to continue as a going concern. The Company’s consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Current wording
As a result, management has concluded, and our independent registered public accounting firm has agreed with our conclusion that there is a substantial doubt regarding our ability to continue as a going concern for a period of at least 12 months beyond the filing of this Annual Report on Form 10-K. The report of our independent registered public accounting firm on our financial statements for the year ended December 31, 2025, includes an explanatory paragraph regarding the existence of substantial doubt about our ability to continue as a going concern. The Company’s consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Previous wording
The Company’s ability to continue as a going concern is dependent upon its ability to raise additional debt or equity capital to fund its business activities and to ultimately achieve sustainable operating revenues and profitability.
Current wording
The Company’s ability to continue as a going concern depends on its ability to raise additional debt or equity capital to fund its business activities and ultimately achieve sustainable operating revenues and profitability.
Previous wording
Cost of sales consists primarily of the cost to purchase merchant gift cards. Cost of sales for the year ended December 31, 2024 and 2023, were $75,654,690 and $76,638,995, respectively. Our cost of sales declined 1.3%, which generated an increase in gross margin of $829,139, or 7.9%, as compared to the prior year period. Our cost of sales, as a percentage of sales, were 87.0% and 87.9%, for the year ended December 31, 2024 and 2023, respectively.
Current wording
Cost of sales consists primarily of the cost to purchase merchant gift cards. Cost of sales for the year ended December 31, 2025 and 2024, were $67,686,362 and $75,789,255, respectively. Gross profit increased $2,350,573, or 17.9%, as compared to the prior year period. Our gross margin, as a percentage of net sales, were 18.6% and 14.8% for the year ended December 31, 2025, and 2024, respectively. Our gross margin was positively impacted by the increase in net revenue (agent transactions) described above, compared with the prior-year period.
Previous wording
Selling, general and administrative expenses consist of costs incurred to identify, communicate with and evaluate potential customers and related business opportunities, and compensation to officers and directors, as well as legal and other professional fees, lease expense, and other general corporate expenses. Management expects selling, general and administrative expenses to increase in future periods as the Company adds personnel and incurs additional costs related to its operation as a public company, including higher legal, accounting, insurance, compliance, compensation and other costs.
Current wording
Selling, general, and administrative expenses consist of costs incurred to identify, communicate with, and evaluate potential customers and related business opportunities; compensation to officers and directors; legal and other professional fees; lease expense; and other general corporate expenses. Management expects selling, general, and administrative expenses to increase in future periods as the Company adds personnel and incurs additional costs related to its operation as a public company, including higher legal, accounting, insurance, compliance, compensation, and other costs.
Previous wording
Amortization expenses are primarily attributed to the Company’s capitalized software development costs. Amortization expenses were $1,472,974 during the year ended December 31, 2024, as compared to $1,080,537 during the year ended December 31, 2023.
Current wording
Amortization expenses are primarily attributed to the Company’s capitalized software development costs. Amortization expenses were $645,375 during the year ended December 31, 2025, as compared to $1,472,974 during the year ended December 31, 2024.
Previous wording
Amortization expenses are primarily attributable to the Company’s amortization of intangible assets with finite lives. Amortization expenses were $2,431,668 during the year ended December 31, 2024. Amortization expenses were $300,000 during the year ended December 31, 2023.
Current wording
Amortization expenses are primarily attributable to the Company’s amortization of intangible assets with finite lives. Amortization expenses were $2,271,673 during the year ended December 31, 2025, as compared to amortization expenses of $2,431,668 during the year ended December 31, 2024.
Previous wording
For the year ended December 31, 2024, we incurred a loss from operations of ($18,375,726), as compared to a loss from operations of ($8,100,406) for the year ended December 31, 2023. The increase in loss from operations was due to our increased gross profit offset by increased stock-based compensation expense, impairment of goodwill and intangible assets, and operating costs, as discussed above. For the period January 1, 2023 to December 29, 2023, operations of Giftify were excluded. See our Basis of Presentation discussion above.
Current wording
For the year ended December 31, 2025, we incurred a loss from operations of $10,354,746, compared with $18,375,726 for the year ended December 31, 2024. The decrease in loss from operations was due to our increased gross profit offset by decreased stock-based compensation expense, as discussed above.
Previous wording
We realized a net loss of ($18,832,080) for the year ended December 31, 2024, as compared to a net loss of ($5,144,546) for the year ended December 31, 2023 (including Predecessor from January 1, 2023 to December 29, 2023). The increase in net loss was due to our increased gross profit offset by increased stock-based compensation expense, operating costs, other expenses, and decreased income taxes, as discussed above.
Current wording
We realized a net loss of $10,491,658 for the year ended December 31, 2025, as compared to a net loss of $18,832,080 for the year ended December 31, 2024. The decrease in net loss was driven by higher gross profit, lower stock-based compensation expense, and lower interest expense, as discussed above.
Previous wording
In addition to our GAAP results, we present Modified EBITDA as a supplemental measure of our performance. However, Modified EBITDA is not a recognized measurement under GAAP and should not be considered as an alternative to net income, income from operations or any other performance measure derived in accordance with GAAP, or as an alternative to cash flow from operating activities as a measure of liquidity. We define Modified EBITDA as net income (loss), plus interest expense, depreciation and amortization, stock-based compensation, and fair value of common stock issued for services.
Current wording
In addition to our GAAP results, we present Modified EBITDA as a supplemental performance measure. However, Modified EBITDA is not a recognized measurement under GAAP and should not be considered as an alternative to net income, income from operations or any other performance measure derived in accordance with GAAP, or as an alternative to cash flow from operating activities as a measure of liquidity. We define Modified EBITDA as net income (loss), plus interest expense, depreciation and amortization, stock-based compensation, and fair value of common stock issued for services.
Previous wording
We present Modified EBITDA because we believe it assists investors and analysts in comparing our performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. In addition, we use Modified EBITDA in developing our internal budgets, forecasts and strategic plan; in analyzing the effectiveness of our business strategies in evaluating potential acquisitions; making compensation decisions; and in communications with our board of directors concerning our financial performance. Modified EBITDA has limitations as an analytical tool, which includes, among others, the following:
Current wording
We present Modified EBITDA because we believe it helps investors and analysts compare our performance across reporting periods on a consistent basis by excluding items we do not believe are indicative of our core operating performance. In addition, we use Modified EBITDA to develop our internal budgets, forecasts, and strategic plan; to analyze the effectiveness of our business strategies and evaluate potential acquisitions; to make compensation decisions; and to communicate with our board of directors regarding our financial performance. Modified EBITDA has limitations as an analytical tool, which include, among others, the following:
Previous wording
Cash used in operating activities for the year ended December 31, 2023 was approximately $541,791 and consisted of our net loss, adjusted for non-cash items, including amortization of intangible assets, impairment of intangible assets, fair value of vested stock options, and the fair value of common stock issued to executives, and routine changes in working capital and other activities.
Current wording
Cash used in operating activities for the year ended December 31, 2025 was $1,590,074 and consisted of our net loss, adjusted for non-cash items, including amortization of intangible assets, the fair value of vested stock options, common stock issued to executives, employees, and advisors, and routine changes in working capital and other activities.
Previous wording
Cash used in operating activities for the year ended December 31, 2024 was approximately $2,551,870 and consisted of our net loss, adjusted for non-cash items, including amortization of intangible assets, impairment of goodwill and intangible assets, the fair value of vested stock options, common stock issued to executives, employees, and advisors, and routine changes in working capital and other activities.
Current wording
Cash used in operating activities for the year ended December 31, 2024 was approximately $3,407,539 and consisted of our net loss, adjusted for non-cash items, including amortization of intangible assets, fair value of vested stock options, and the fair value of common stock issued to executives, employees, and advisors, and routine changes in working capital and other activities.
Previous wording
Cash provided by investing activities for the year ended December 31, 2023 was $1,138,472, which was comprised of $2,038,472 of cash received from an acquisition, offset by $900,000 of cash used for capital expenditures.
Current wording
Cash provided by investing activities for the year ended December 31, 2025 was $109,543, which was from cash received on an acquisition.
Previous wording
The Company had no cash flows from investing activities for the year ended December 31, 2024.
Current wording
We had no cash flows from investing activities for the year ended December 31, 2024.
Previous wording
Cash provided by financing activities for the year ended December 31, 2024 was $2,027,009, which was from proceeds of $3,507,585 on the sale of common stock, net proceeds of $1,978,000 from a note payable to a related party, offset by repayment of our line of credit balance of $2,932,305, repayment of our notes payable of $26,271, and payment of $500,000 on our acquisition obligation.
Current wording
Cash provided by financing activities for the year ended December 31, 2024 was $2,027,009, which was from proceeds of $3,054,073 on the sale of common stock, proceeds from notes payable of $1,978,000, offset by repayment of our line of credit of $2,503,236, and payment of $500,000 on our acquisition obligation.
Previous wording
Our consolidated financial statements have been presented on the basis that it will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. We experienced operating losses and negative operating cash flows during 2024 and 2023. We have financed our working capital requirements through borrowings from various sources and the sale of equity securities.
Current wording
Our consolidated financial statements have been presented on the basis that the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. We experienced operating losses and negative operating cash flows during 2025 and 2024. We have financed our working capital requirements through borrowings from various sources and the sale of equity securities.
Previous wording
We have a history of reporting net losses. At December 31, 2024, we had cash of $3,574,876 available to fund our operations, including expansion plans, and to service our debt, and a negative working capital of $3,204,077. We anticipate our cash balance will last until approximately December 2025. As a result, we have concluded that there is substantial doubt about the Company’s ability to continue as a going concern. In addition, the Company’s independent registered public accounting firm has included an explanatory paragraph in their report with respect to this uncertainty that accompanies the Company’s audited consolidated financial statements as of and for the year ended December 31, 2024. The Company’s independent registered public accounting firm, in their report on the Company’s December 31, 2024 audited consolidated financial statements, has expressed substantial doubt about the Company’s ability to continue as a going concern. Our consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Current wording
We have a history of reporting net losses. As of December 31, 2025, we had $3,654,944 in cash available to fund our operations, including expansion plans, and to service our debt, and working capital of $249,223. We anticipate our cash balance will last until December 2026. As a result, management has concluded, and our independent registered public accounting firm has agreed with our conclusion that there is a substantial doubt regarding our ability to continue as a going concern for a period of at least 12 months beyond the filing of this Annual Report on Form 10-K. The report of our independent registered public accounting firm on our financial statements for the year ended December 31, 2025, includes an explanatory paragraph regarding the existence of substantial doubt about our ability to continue as a going concern. Our consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Previous wording
Our ability to continue as a going concern is dependent upon its ability to raise additional debt or equity capital to fund its business activities and to ultimately achieve sustainable operating revenues and profitability.
Current wording
Our ability to continue as a going concern depends on our ability to raise additional debt or equity capital to fund our business activities and ultimately achieve sustainable operating revenues and profitability.
Previous wording
If we are unable to obtain the cash resources necessary to satisfy our ongoing cash requirements, we could be required to scale back its business activities or to discontinue its operations entirely.
Current wording
If we are unable to secure the cash resources necessary to meet our ongoing cash requirements, we may be required to scale back our business activities or discontinue operations entirely.
Previous wording
The following discussion and analysis of financial condition and results of operations is based upon the Company’s consolidated financial statements for the years ended December 31, 2024 and 2023 presented elsewhere in this report, which have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Certain accounting policies and estimates are particularly important to the understanding of the Company’s financial position and results of operations and require the application of significant judgment by management or can be materially affected by changes from period to period in economic factors or conditions that are outside of the Company’s control. As a result, these issues are subject to an inherent degree of uncertainty. In applying these policies, management uses its judgment to determine the appropriate assumptions to be used in the determination of certain estimates. Those estimates are based on the Company’s historical operations, the future business plans and the projected financial results, the terms of existing contracts, trends in the industry, and information available from other outside sources.
Current wording
The following discussion and analysis of financial condition and results of operations is based upon the Company’s consolidated financial statements for the years ended December 31, 2025 and 2024 presented elsewhere in this report, which have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Certain accounting policies and estimates are particularly important to the understanding of the Company’s financial position and results of operations and require the application of significant judgment by management or can be materially affected by changes from period to period in economic factors or conditions that are outside of the Company’s control. As a result, these issues are inherently uncertain. In applying these policies, management uses its judgment to select the appropriate assumptions for certain estimates. Those estimates are based on the Company’s historical operations, the future business plans and the projected financial results, the terms of existing contracts, trends in the industry, and information available from other outside sources.
Previous wording
The Company buys merchant gift cards from the general public and distributors at a discount and then resells them at a markup. The Company also derives revenue from the sale of discount certificates for restaurants on behalf of third-party restaurants.
Current wording
The Company buys merchant gift cards from the general public and distributors at a discount and then resells them at a markup. The Company also derives revenue from the sale of discount certificates for third-party restaurants.
Previous wording
Revenue and costs of sales are recognized when control of the products transfers to our customer, which generally occurs at a point in time when the risk and title to the product transfers to the customer upon delivery to the customer. The Company’s performance obligations are satisfied at that time. The Company’s standard terms of delivery are included in its contracts of sale, order confirmation documents, and invoices. The Company recognizes revenue on a gross basis for the sales price of the merchant gift cards and discount certificates it collects.
Current wording
Revenue and costs of sales are recognized when control of the products transfers to our customer, which generally occurs when the risk and title to the products transfer to the customer upon delivery. The Company’s performance obligations are satisfied at that time. The Company’s standard terms of delivery are included in its contracts of sale, order confirmation documents, and invoices. The Company recognizes revenue on a gross basis for the sales price of the merchant gift cards and discount certificates it collects.
Previous wording
The Company periodically issues share-based awards to employees and non-employees and consultants for services rendered. Stock options vest and expire according to terms established at the issuance date of each grant. Stock grants are measured at the grant date fair value. Stock-based compensation cost is measured at fair value on the grant date and is generally recognized as a charge to operations ratably over the requisite service, or vesting, period. Recognition of compensation expense for non-employees is in the same period and manner as if the Company had paid cash for the services.
Current wording
The Company periodically issues share-based awards to employees, non-employees, and consultants for services rendered. Stock options vest and expire according to the terms established at the grant’s issuance date. Stock grants are measured at the grant date fair value. Stock-based compensation cost is measured at fair value on the grant date and is generally recognized as an expense in the statement of operations ratably over the requisite service period or vesting period. Recognition of compensation expense for non-employees occurs in the same period and in the same manner as if the Company had paid cash for the services.
Previous wording
The Company allocates the fair value of purchase consideration to the tangible assets acquired, liabilities assumed, and separately identified intangible assets acquired based on their estimated fair values. The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. Such valuations require management to make significant estimates and assumptions, especially with respect to intangible assets. Significant estimates in valuing certain intangible assets include, but are not limited to, future expected cash flows from, acquired technology, trademarks and trade names, useful lives, and discount rates. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. During the measurement period, which can be up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill. Upon the conclusion of the measurement period, any subsequent adjustments are recorded in the consolidated statements of operations.
Current wording
The Company allocates the fair value of the purchase consideration to the tangible assets acquired, the liabilities assumed, and the separately identifiable intangible assets acquired, based on their estimated fair values. The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. Such valuations require management to make significant estimates and assumptions, particularly regarding intangible assets. Significant estimates in valuing certain intangible assets include, but are not limited to, future expected cash flows from acquired technology, trademarks, and trade names, useful lives, and discount rates. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable, and, as a result, actual results may differ from estimates. During the measurement period, which can be up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill. Upon the conclusion of the measurement period, any subsequent adjustments are recorded in the consolidated statements of operations.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Cash provided by financing activities for the year ended December 31, 2025 was $833,633, which was from aggregate proceeds of $5,019,905 on the sale of common stock, net proceeds of $985,000 from a note payable, offset by repayment of our line of credit balance of $592,145, and repayment of our notes payable of $4,579,127.