Empery Digital Inc.
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
EMPD$2.00-3.4%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 2025-05-09.
0001683168-25-003351
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.
0001683168-25-005920
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 81 previous paragraphs and 98 current paragraphs.
41 unchanged; 25 reworded; 31 added; 15 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 2 previous and 1 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 (31)
Current report
This Quarterly Report on Form 10-Q contains forward-looking statements. These forward-looking statements generally can be identified by the use of words such as “anticipate,” “expect,” “plan,” “could,” “may,” “believe,” “estimate,” “forecast,” “goal,” “potentially,” “project,” and other words of similar meaning All statements, other than statements related to present facts or current conditions or historical facts, contained in this Quarterly Report on Form 10-Q are forward-looking statements, including statements regarding our strategy, future operations, future financial position, including the Company's plans to pursue a number of strategic initiatives to acquire Bitcoin and other digital assets, the Company's plans to efficiently build its BTC portfolio and reposition its power sports business, the proposed real time updates on the Company’s website, the Company's ability to successfully maintain the listing of our common stock on the Nasdaq Stock Market, the development of a procurement plan for Super Sonic and the approval of the Company's 2025 Stock Plan.
Current report
Each forward-looking statement is subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied in such statement. Applicable risks and uncertainties include the risks and uncertainties regarding, among other things: our ability to change the direction of the Company; our ability to keep pace with new technology and changing market needs; the digital assets to be held by the Company; the Company’s successful implementation of its digital asset treasury strategy; changes in business, market, financial, political and regulatory conditions, risks relating to the Company’s operations and business, including the highly volatile nature of the price of Bitcoin and other cryptocurrencies; the risk that the Company’s stock price may be highly correlated to the price of the digital assets that it holds; risks related to increased competition in the industries in which the Company does and will operate; risks relating to significant legal, commercial, regulatory and technical uncertainty regarding digital assets generally; risks relating to the treatment of crypto assets for U.S. and foreign tax purpose and the competitive environment of our business. Other risks and uncertainties include those identified under the heading “Risk Factors” contained in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the SEC on March 31, 2025 (as amended by Form 10-K/A filed with the SEC on April 29, 2025, as amended further by Form 10-K/A filed with the SEC on April 30, 2025), our Quarterly Report on Form 10-Q for the quarter ended March 31, 2025, filed with the SEC on May 9, 2025, and in any subsequent filings with the SEC.
Current report
As a result of these and other factors, we may not achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. The forward-looking statements contained in this Quarterly Report on Form 10-Q reflect our views as of the date hereof. We do not assume and specifically disclaim any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Our business is subject to substantial risks and uncertainties, including those referenced above. Investors, potential investors, and others should give careful consideration to these risks and uncertainties.
Current report
Digital Asset Treasury Strategy
Current report
On July 17, 2025, the Company announced its entry into securities purchase agreements with certain institutional and accredited investors in private placements for the purchase and sale of an aggregate 50,142,851 shares of common stock (or pre-funded warrants in lieu thereof) at a price of $10.00 per share, for expected aggregate gross proceeds of approximately $501 million, before deducting placement agent fees and other offering expenses (the “Private Placements”). The Private Placements closed on July 21, 2025. The Company has used the net proceeds from the Private Placements to purchase or otherwise acquire Bitcoin and for the establishment of the Company’s cryptocurrency treasury operations. In connection with the announcement of the Private Placements, the Company announced the launch of its digital asset treasury strategy, pursuant to which the Company plans to pursue a number of strategic initiatives to acquire Bitcoin and other digital assets.
Current report
Electric Vehicle*
Current report
We operate an all-electric, off-road powersports vehicle business. Beginning in 2021, we began efforts to sell off-road powersports vehicles beginning with an electric two-wheeled motorcycle that we discontinued in March 2025. In 2022 we introduced an E-Bike, the Brat, and continue to sell this product. In late 2024 we began selling the HF1 UTV, the MN1 Adventurer and MN1 Tradesman UTV, along with a line of upgrades and accessories.
Current report
Revenue for the three months ended June 30, 2025 was $702,936 which represents sales of Brats of $202,998, HF1s of $307,198, MN1-Adventurers of $74,461, MN1-Tradesman of $123,884, and accessories and parts of $26,992.
Current report
Revenue for the three months ended June 30, 2024, was $940,863, which represents sales of Grunt EVOs of $284,147, Stags of $194,887, Brats of $240,750, Volcon Youth of $192,924, and accessories and parts of $52,696.
Current report
Revenue for the six months ended June 30, 2024, was $1,974,411 which represents sales of Grunt EVOs of $613,764, Stags of $234,886, Brats of $773,556, Volcon Youth of $286,680, and accessories and parts of $86,800.
Current report
We expect revenue to decrease in the three months ended September 30, 2025 due to lower finished good inventory as we await completion and shipment of inventory on order at third party manufacturers.
Current report
Cost of goods sold for the three months ended June 30, 2025 was $851,476, including payroll costs of $122,415 for employees performing product fulfillment, logistics management, and service and warranty and facilities costs of $121,279. Inventory adjustments were $76,573 and warranty expense was a benefit of $69,371 due to the expiration of product warranties and resulting reversal of warranty accrual. Product costs were $41,339 for Grunt EVOs, $190,072 for Brats, $206,684 for HF1s, and $225,186 for MN1s.
Current report
Cost of goods sold for the six months ended June 30, 2025 was $1,632,859, including payroll costs of $208,668 for employees performing product fulfillment, logistics management, and service and warranty and facilities costs of $245,143. Inventory adjustments were $84,822 offset by a benefit of $74,184 due to the expiration of product warranties and resulting reversal of warranty accrual. Product costs were $265,620 for Grunt EVOs, $309,861 for Brats, $332,785 for HF1s and $356,623 for MN1s.
Current report
Cost of goods sold for the three months ended June 30, 2024 were $3,113,429, including payroll costs of $72,466 for employees performing product fulfillment, logistics management, and service and warranty. Product costs for Brats and Grunt EVOs sold during the period were $221,624 and $292,561, respectively. Stag product costs were $490,622 which includes an expense of $16,617 for the future delivery of vehicles to a customer where the Company agreed to provide additional units at a sales price less than the manufactured cost of the units. Youth product costs were $140,827 and, due to the settlement agreement with Torrot, the remaining Youth finished goods inventory of $57,262 was written off as Empery Digital can no longer sell Torrot/Volcon Youth finished goods after June 30, 2024. Facilities costs related to operations were $104,976. Loss on disposal of Stag tooling was $466,481 which represent tooling costs which were determined to be impaired due to the limited margin expected to be realized on Stag sales. The Company also recognized an expense of $1,117,429 for a settlement agreement with a vendor who supplies certain suspension components for the Stag. The Company will pay for excess raw materials purchased by the vendor based on an early production forecast initially provided to the vendor, which was subsequently revised.
Current report
Cost of goods sold for the six months ended June 30, 2024 were $4,735,009, including payroll costs of $166,786 for employees performing product fulfillment, logistics management, and service and warranty. Product costs for Brats and Grunt EVOs, sold during the period were $804,174 and $636,542, respectively. Stag product costs were $719,515, which includes an expense of $112,168 for the already delivered and future delivery of vehicles to a customer where the Company agreed to provide additional units at a sales price less than the manufactured cost of the units and, due to the settlement agreement with Torrot, the remaining Youth finished goods inventory of $57,262 was written off as Empery Digital can no longer sell Torrot/Volcon Youth finished goods after June 30, 2024. Facilities costs related to operations were $210,926. Loss on disposal of Stag tooling, as noted above, was $466,481 and in the first quarter of 2024, the Company recorded a loss on disposal in the amount of $155,621 for the write off of Grunt EVO tooling. As discussed above, the Company recognized an expense of $1,117,429 for a settlement with a vendor.
Current report
For the remainder of 2025 we expect cost of goods sold to decrease due to lower revenue as noted above.
Current report
Sales and marketing expenses were $1,133,729 for the six months ended June 30, 2025 and were primarily related to expenses associated with promoting our products and brand of $361,041 employee payroll costs of $365,637, and professional fees of $131,620 for fees paid to a third party distributor, third party sales consultants and legal fees. Travel expenses were $61,713 and depreciation expense of $103,555 primarily for demonstration vehicles used to promote our products.
Current report
Sales and marketing expenses were $543,671 for the three months ended June 30, 2024 and were primarily related to expenses associated with promoting our products and brand of $193,344, employee payroll costs of $121,187, which was partially offset by stock-based compensation benefit of $67,001. Professional fees for legal and consulting services were $64,412. Travel expenses related to roadshows showcasing the Stag and EVO were $21,453 and facilities costs were $23,514. Depreciation expense was $27,674 and bad debt expense was reduced by $30,426 due to collection of previously expensed customer accounts.
Current report
For the remainder of 2025 we expect sales and marketing expenses to increase as we increase spending to establish the Empery Digital brand and stock-based compensation for stock options granted to sales personnel and a marketing consultant in the Private Placements as discussed in Note 13 to the condensed consolidated financial statements.
Current report
Product development expenses were $221,159 for the three months ended June 30, 2025 and were primarily related to expenses associated with employee payroll costs of $140,522, and facilities costs of $47,432.
Current report
Product development expenses were $609,681 for the six months ended June 30, 2025 and were primarily related to expenses associated with employee payroll costs of $389,876, depreciation expense of $36,432 and facilities costs of $104,214.
Current report
Product development expenses were $805,550 for the three months ended June 30, 2024 and were primarily related to expenses associated with employee payroll costs of $394,632, stock-based compensation of $83,733 for share-based awards granted to employees, facilities costs of $60,212, and prototype costs of $114,781. Professional fees were $48,024 for product design and travel expenses were $33,264.
Current report
Product development expenses were $1,620,495 for the six months ended June 30, 2024 and were primarily related to expenses associated with employee payroll costs of $831,534, stock-based compensation of $126,337 for share-based awards granted to employees, facilities costs of $124,067, prototype costs of $206,706 and professional fees related to product development in the amount of $62,909. Travel expenses were $86,590 and depreciation expense was $69,381.
Current report
For the remainder of 2025 we expect product development costs related to employee costs to decrease due to fewer products in development subsequent to June 30, 2025 offset by an increase for stock-based compensation for stock options granted to product development personnel in the Private Placements as discussed in Note 13 to the condensed consolidated financial statements.
Current report
General and administrative expenses were $4,440,993 for the six months ended June 30, 2025, and were primarily related to expenses associated with employee payroll costs of $1,091,826, stock-based compensation of $1,125,802 for share-based awards granted to employees, professional fees of $451,142 (including auditor fees of $100,425, legal fees of $185,832 and consulting fees of $164,884), software costs of $245,284, insurance costs of $904,759, and travel expenses of $90,050. Public company expense costs of $130,988, annual meeting costs of $74,450 and Board compensation expense of $100,000.
Current report
For the three months ended June 30, 2024, general and administrative expenses were $2,007,514 and were primarily related to expenses associated with employee payroll costs of $527,052, stock-based compensation of $138,203 for share-based awards granted to employees, professional fees of $190,059 (including legal fees of $95,718, tax and accounting fees of $35,105 and audit fees of $23,175), software costs of $152,062, insurance costs of $656,288, public company expense costs of $101,653 and annual meeting costs of $94,982.
Current report
For the six months ended June 30, 2024, general and administrative expenses were $4,088,308 and were primarily related to expenses associated with employee payroll costs of $1,106,415, stock-based compensation of $159,390 for share-based awards granted to employees, professional fees of $602,774 (including legal fees of $291,095, tax and accounting fees of $58,305 and audit fees of $170,100), software costs of $293,613, insurance costs of $1,319,215, public company expense costs of $204,375 and annual and special shareholder meeting costs of $133,531.
Current report
For the remainder of 2025 we expect general and administrative expenses to increase, primarily due to stock-based compensation for stock options granted to general and administrative personnel in the Private Placements as discussed in Note 13 to the condensed consolidated financial statements and increased legal and professional fees, as we establish our digital asset strategy.
Current report
Interest and other income/expenses for the six months ended June 30, 2025 was insignificant.
Current report
Net loss for the three and six months ended June 30, 2024, was $606,418 and $26,654,462, respectively.
Current report
As discussed further in Note 13 to the condensed consolidated financial statements, on July 21, 2025 the Company completed the Private Placements sale of 50,142,851 shares of common stock (or pre-funded warrants in lieu thereof) at a price of $10.00 per share, for aggregate gross proceeds of over $501 million which includes the settlement of certain purchasers using Bitcoin valued at $28.0 million and net proceeds of $481 million. The Company intends to use these proceeds to purchase Bitcoin under its cryptocurrency treasury strategy and to fund operations.
Removed paragraphs (15)
Previous report
This Quarterly Report on Form 10-Q, together with other statements and information publicly disseminated by the Company, contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and include this statement for purposes of complying with these safe harbor provisions.
Previous report
In addition, from time to time, we or our representatives may make forward-looking statements orally or in writing. We base these forward-looking statements on our expectations and projections about future events, which we derive from the information currently available to us. Such forward-looking statements relate to future events or our future performance, including: our financial performance and projections; our growth in revenue and earnings; our product development and production releases; and our business prospects and opportunities. You can identify forward-looking statements by those that are not historical in nature, particularly those that use terminology such as “may,” “should,” “expects,” “anticipates,” “contemplates,” “estimates,” “believes,” “plans,” “projected,” “predicts,” “potential,” or “hopes” or the negative of these or similar terms. In evaluating these forward-looking statements, you should consider various factors, including: our ability to change the direction of the Company; our ability to keep pace with new technology and changing market needs; and the competitive environment of our business. These and other factors may cause our actual results to differ materially from any forward-looking statement. Forward-looking statements are only predictions. The forward-looking events discussed in this document and other statements made from time to time by us or our representatives, may not occur, and actual events and results may differ materially and are subject to risks, uncertainties and assumptions about us. We are not obligated to publicly update or revise any forward-looking statement, whether as a result of uncertainties and assumptions, the forward-looking events discussed in this document and other statements made from time to time by us or our representatives might not occur.
Previous report
While we believe we have identified material risks, these risks and uncertainties are not exhaustive. Other sections of this Form 10-Q describe additional factors that could adversely impact our business and financial performance. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible to predict all risks and uncertainties, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.
Previous report
Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy or completeness of any of these forward-looking statements. You should not rely upon forward-looking statements as predictions of future events. We are under no duty to update any of these forward-looking statements after the date of this Form 10-Q to conform our prior statements to actual results or revised expectations, and we do not intend to do so.
Previous report
Forward-looking statements include, but are not limited to, statements about:
Previous report
Revenue for the three months ended March 31, 2024 was $1,033,548 which represents sales of Grunt EVOs of $329,617, Stag of $39,999, Brats of $532,806, Volcon Youth of $93,757, and accessories and parts of $34,103.
Previous report
Cost of goods sold for the three months ended March 31, 2025 was $781,383, including payroll costs of $86,254 for employees performing product fulfillment, logistics management, and service and warranty and facilities costs of $123,863. Product costs were $224,281 for Grunt EVOs, $119,789 for Brats, $126,101 for HF1s and $131,437 for MN1s.
Previous report
Cost of goods sold for the three months ended March 31, 2024 was $1,621,580, including payroll costs of $94,320, which was partially offset by a stock-based compensation benefit of $10,641, for employees performing product fulfillment, logistics management, and service and warranty. Product costs were $343,981 for Grunt EVOs,$228,893 for the Stag which included costs for the one Stag sold in the amount of $43,412 and $10,429 for customized inventory related to the sale of the Stag, $582,550 for Brats and $42,311 for Volcon Youth. Also Included in the Stag product costs is $95,548 of expense related to accruing a loss on sales of units to a customer who initially ordered models that we will not be producing. The Company offered to substitute additional units of the Stag LTD at no additional charge to replace those units. Also relating to Stag costs is $52,503 in inbound freight and tariffs for Stag raw materials. Facilities costs for the three months ended March 31, 2024 were $105,950 for our warehouse facility and third party warehousing costs.
Previous report
For the remainder of 2025 we expect revenue to increase due to the expected increase in sales of our products. We expect product costs to increase due to increased sales as well as increased tariffs since our products are manufactured outside the U.S. but it is difficult to predict in the current political environment. Product cost savings may be realized if the third party manufacturer for our vehicles can source or manufacture parts at a lower cost.
Previous report
For the remainder of 2025 we expect sales expenses to increase as we begin expanding our international distributors and selling commissions for increased sales of our products. We expect marketing expenses to increase to promote the MN1 and HF1 products and to launch the two-wheel motorcycle that will replace the Grunt EVO.
Previous report
Product development expenses were $388,523 for the three months ended March 31, 2025 and were primarily related to expenses associated with employee payroll costs of $249,354, and facilities costs of $56,782.
Previous report
Product development expenses were $814,945 for thethree months ended March 31, 2024 and were primarily related to expenses associated with employee payroll costs of $436,902, stock-based compensation of $42,604 for share-based awards granted to employees, facilities costs of $63,856, travel costs primarily related to beginning production of Stag of $53,326 and prototype costs of $91,925.
Previous report
For the remainder of 2025 we expect product development costs related to employee costs to remain consistent with the quarter ended March 31, 2025 and we expect an increase in prototype expenses as we develop the dual sport motorcycle.
Previous report
General and administrative expenses were$2,080,794 for the three months ended March 31, 2024, and were primarily related to expenses associated with employee payroll costs of $579,363, stock-based compensation of $21,187 for share-based awards granted to employees, professional fees of $412,715 (including legal fees of $195,377, tax and accounting fees of $23,200 and audit fees of $146,925), software costs of $141,551, insurance costs of $662,927, and public company expense costs of $102,721.
Previous report
For the remainder of 2025 we expect general and administrative expenses to remain consistent. Costs such as product liability insurance may increase due to the introduction of new products and increased sales.
Reworded paragraphs (25)
Previous wording
The following discussion and analysis is intended as a review of significant factors affecting the Company’s financial condition and results of operations for the periods indicated. This discussion and analysis should be read in conjunction with the financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and the Company’s Annual Report on Form 10-K, which contains audited financial statements of the Company as of and for the year ended December 31, 2024, previously filed with the Securities and Exchange Commission. Results for the three months ended March 31, 2025 are not necessarily indicative of results for the year ending December 31, 2025 or any future period.
Current wording
The following discussion and analysis is intended as a review of significant factors affecting the Company’s financial condition and results of operations for the periods indicated. This discussion and analysis should be read in conjunction with the financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and the Company’s Annual Report on Form 10-K, which contains audited financial statements of the Company as of and for the year ended December 31, 2024, previously filed with the Securities and Exchange Commission. Results for the three and six months ended June 30, 2025 are not necessarily indicative of results for the year ending December 31, 2025 or any future period.
Previous wording
We are an all-electric, off-road powersports vehicle company selling Volcon electric two-wheeled E-Bikes and motorcycles, utility terrain vehicles, or UTVs, also known as side-by-sides, and golf carts, along with a line of upgrades and accessories. In January 2025, we also entered into a distribution agreement with a golf cart manufacturer, Super Sonic Company Ltd. (“Super Sonic”) located in Vietnam, and a subsidiary of Odes Industry, to supply golf carts to other companies in the United States who sell golf carts.
Current wording
In January 2025, we also entered into a distribution agreement with a golf cart manufacturer, Super Sonic Company Ltd. (“Super Sonic”) located in Vietnam, and a subsidiary of Odes Industry, to supply golf carts to other companies in the United States who sell golf carts.
Previous wording
We began selling the Grunt in September 2021 and the Grunt EVO replaced the Grunt in September 2023. Due to the manufacturing cost of the Grunt EVO, we terminated the manufacturing contract for it in December 2024. As of March 31, 2025, we have sold all of the remaining Grunt EVO units.
Current wording
We began selling the Grunt off-road motorcycle in September 2021 and the Grunt EVO off-road motorcycle replaced the Grunt in September 2023. Due to the manufacturing cost of the Grunt EVO, we terminated the manufacturing contract for it in December 2024. As of March 31, 2025, we have sold all of the remaining Grunt EVO units.
Previous wording
Beginning in the second quarter of 2024, we began evaluating other potential electric motorcycle offerings. We are determining what features and specifications would be included for new offerings including considering a street legal version that would be dual purpose as an on-road/off-road motorcycle (not highway legal). We have identified one new model which we are working on developing with a third party manufacturer. We received prototypes in February 2025 and we are testing them to evaluate the feasibility to produce and sell them. Provided testing is successful and whether the product cost, including tariffs, allow for us to sell this product, we expect to start selling this product in the second half of 2025.
Current wording
Beginning in the second quarter of 2024, we began evaluating other potential electric motorcycle offerings. We are determining what features and specifications would be included for new offerings including considering a street legal version that would be dual purpose as an on-road/off-road motorcycle (not highway legal). We have identified one new model which we are working on developing with a third party manufacturer. We received prototypes in February 2025 and we are testing them to evaluate the feasibility to produce and sell them. Provided testing is successful and whether the product cost, including tariffs, allow for us to sell this product. We expect to start selling this product in 2026.
Previous wording
In January 2025, we signed an exclusive distribution agreement (the “Distribution Agreement”) with the manufacturer of the MN1s to distribute their golf carts in the United States and its territories. Super Sonic appointed us to act as their exclusive distributor of certain of their golf cart products (the “Products”), in the U.S. Super Sonic agreed to recommend us as the sole provider for all Products to all their customers in the U.S. Super Sonic has the right to sell non-Volcon branded Products to other customers and shall pay 5% of the order price to us. Before the end of June 2025, we agreed to provide a procurement plan, and if we fail to meet the minimum purchase requirement described in the procurement plan for two consecutive months, Super Sonic shall have the right to immediately terminate the Distribution Agreement. During the term of the Distribution Agreement, to the extent we sell any Volcon-branded products (the “Volcon Products”) that are similar to the Products, we agreed to provide Super Sonic with a right of first refusal to manufacture the Volcon Products. We may be required to issue our common stock, warrants to purchase our common stock and the right to appoint a director to our board of directors if certain golf cart sales volumes are attained.
Current wording
In January 2025, we signed an exclusive distribution agreement (the “Distribution Agreement”) with the manufacturer of the MN1s to distribute their golf carts in the United States and its territories. Super Sonic appointed us to act as their exclusive distributor of certain of their golf cart products (the “Products”), in the U.S. Super Sonic agreed to recommend us as the sole provider for all Products to all their customers in the U.S. Super Sonic has the right to sell non-Volcon branded Products to other customers and shall pay 5% of the order price to us. Before the end of June 2025, we agreed to provide a procurement plan, and if we fail to meet the minimum purchase requirement described in the procurement plan for two consecutive months, Super Sonic shall have the right to immediately terminate the Distribution Agreement. Through August 8, 2025, a procurement plan has not been provided and the Company is continuing to work to develop it. During the term of the Distribution Agreement, to the extent we sell any Volcon-branded products (the “Volcon Products”) that are similar to the Products, we agreed to provide Super Sonic with a right of first refusal to manufacture the Volcon Products. We may be required to issue our common stock, warrants to purchase our common stock and the right to appoint a director to our Board of Directors if certain golf cart sales volumes are attained.
Previous wording
On February 24, 2025, we entered into a supply agreement with Venom-EV LLC (“Venom”) to supply Venom with certain golf carts. This agreement was amended and restated on April 25, 2025 (the “Supply Agreement”). The Supply Agreement allows Venom to purchase up to $2 million of golf carts with payment terms of the earlier of 100 days from the date the golf carts are shipped from the manufacturer’s facility or upon sale to Venom’s dealers or to consumers. These golf carts will be purchased through a manufacturer specified in the Supply Agreement and we will receive consideration of the cost of the golf carts plus a five percent margin. We received an initial order from Venom for $2.0 million golf carts and paid a deposit to the manufacturer of $0.6 million on May 2, 2025. The remaining $1.4 million will be paid as golf carts are completed and ready for shipment which is expected to be in the second quarter of 2025.
Current wording
On February 24, 2025, we entered into a supply agreement with Venom-EV LLC (“Venom”) to supply Venom with certain golf carts. This agreement was amended and restated on April 25, 2025 (the “Supply Agreement”). The Supply Agreement allows Venom to purchase up to $2.0 million of golf carts with payment terms of the earlier of 100 days from the date the golf carts are shipped from the manufacturer’s facility or upon sale to Venom’s dealers or to consumers. These golf carts will be purchased through a manufacturer specified in the Supply Agreement and we will receive consideration of the cost of the golf carts plus a five percent margin. We received an initial order from Venom for $2.0 million golf carts and paid a deposit to the manufacturer of $0.6 million on May 2, 2025. The remaining $1.4 million will be paid as golf carts are completed and ready for shipment which is expected to be in the third quarter of 2025.
Previous wording
We sell our products through powersports dealers, bicycle retailers, and golf cart dealers. As of May 5, 2025, we have 129 active powersports dealers, 20 active bicycle dealers and 14 golf cart dealers. For dealers who qualify for credit, we offer dealers payment terms of 30 to 90 days to make larger purchases of our vehicles provided their order is within their established credit limit. For dealers that do not qualify for credit, they must pay for their order prior to shipment. Powersports dealers can order any of our available products, bicycle retailers can order the Brat, and golf cart dealers can order either version of the MN1. We have entered into an accounts receivable factoring arrangement to allow us the ability to generate cash for working capital. We have agreements with third party financing companies to provide financing to qualified customers of dealers or customers purchasing from our website. There is no recourse to us or the dealer if the customer defaults on the financing agreement with the third party.
Current wording
We sell our products through powersports dealers, bicycle retailers, and golf cart dealers. As of August 8, 2025, we have 93 active powersports dealers, 23 active bicycle dealers and 16 golf cart dealers. For dealers who qualify for credit, we offer dealers payment terms of 30 to 90 days to make larger purchases of our vehicles provided their order is within their established credit limit. For dealers that do not qualify for credit, they must pay for their order prior to shipment. Powersports dealers can order any of our available products, bicycle retailers can order the Brat, and golf cart dealers can order either version of the MN1. In May 2025, we entered into a floor plan financing arrangement with a financial institution for a total of $3.5 million in available financing to dealers who qualify under the floor plan providers credit policies. We placed a $2.0 million certificate of deposit with the floor plan providers financial institution that will mature in June 2026. In May 2025 we notified our accounts receivable factoring provider that we would terminate this arrangement when it expires in November 2025. We have agreements with third party financing companies to provide financing to qualified customers of dealers or customers purchasing from our website. There is no recourse to us or the dealer if the customer defaults on the financing agreement with the third party.
Previous wording
We outsource the manufacturing of all of our vehicles and accessories to third party manufacturers and suppliers. The estimated fulfillment of all two-wheeled and UTV orders we have received, or will receive, assumes that our third party manufacturers can successfully meet our order quantities and deadlines. We have experienced delays due to our third party manufacturers being unable to timely meet our order deadlines, and there is no assurance that we will not experience delays in the future until such time as we are able to source products from multiple manufacturers or from larger, more established manufacturers. If they are unable to satisfy orders on a timely basis, our customers may cancel their orders. Also, due to the limited number of third party manufacturers who manufacture our products, if any one of them experiences financial hardship and cannot manufacture our products, our customers may cancel their orders which will harm our sales. All of our products are manufactured internationally. Due to the change in tariffs announced in April 2025, the cost of our products will increase and could increase further if additional changes in import laws or tariffs occur. We could also experience delays in receiving shipments of our products if there are delays in getting carriers to ship our products or delays at the port of entry.
Current wording
We outsource the manufacturing of all our vehicles and accessories to third party manufacturers and suppliers. The estimated fulfillment of all two-wheeled and UTV orders we have received, or will receive, assumes that our third party manufacturers can successfully meet our order quantities and deadlines. We have experienced delays due to our third party manufacturers being unable to timely meet our order deadlines, and there is no assurance that we will not experience delays in the future until such time as we are able to source products from multiple manufacturers or from larger, more established manufacturers. If they are unable to satisfy orders on a timely basis, our customers may cancel their orders. Also, due to the limited number of third party manufacturers who manufacture our products, if any one of them experiences financial hardship and cannot manufacture our products, our customers may cancel their orders which will harm our sales. All of our products are manufactured internationally Due to new and increased tariffs and other trade policies introduced or threatened by the U.S. government since the beginning of 2025, we expect that the cost of our products will increase and may increase further if additional changes in import laws or tariffs occur. We could also experience delays in receiving shipments of our products if there are delays in getting carriers to ship our products or delays at the port of entry.
Previous wording
The following financial information is for the three months ended March 31, 2025 and 2024.
Current wording
The following financial information is for the three and six months ended June 30, 2025 and 2024.
Previous wording
Revenue for the three months ended March 31, 2025 was $736,049 which represents sales of Grunt EVOs of $304,905, Brats of $99,458, HF1s of $142,121, MN1-Adventurers of $91,717, MN1-Tradesman of $33,799, and accessories and parts of $24,345.
Current wording
Revenue for the six months ended June 30, 2025 was $1,438,985 which represents sales of Grunt EVOs of $304,905, Brats of $302,456, HF1s of $449,319, MN1-Adventurers of $166,178, MN1-Tradesman of $157,683, and accessories and parts of $51,337.
Previous wording
Sales and marketing expenses were $510,957 for the three months ended March 31, 2025 and were primarily related to expenses associated with promoting our products and brand of $101,517 employee payroll costs of $198,319, and professional fees of $72,551 for fees paid to a third party distributor, third- party sales consultants and legal fees.
Current wording
Sales and marketing expenses were $622,772 for the three months ended June 30, 2025 and were primarily related to expenses associated with promoting our products and brand of $259,524, employee payroll costs of $167,318, and professional fees of $59,069 for fees paid to a third party distributor, third party sales consultants and legal fees and depreciation expense of $92,511 primarily for demonstration vehicles used to promote our products.
Previous wording
Sales and marketing expenses were $760,564 for the three months ended March 31, 2024 and were primarily related to expenses associated with promoting our products and brand of $215,429, employee payroll costs of $453,191, including $112,500 for severance costs for our former chief marketing officer (“CMO”), which was partially offset by stock-based compensation benefit of $55,071 for cancellation of unvested share based awards to the CMO and other marketing employees whose positions were eliminated in the period and the CMO’s unvested share based awards.
Current wording
Sales and marketing expenses were $1,304,235 for the six months ended June 30, 2024 and were primarily related to expenses associated with promoting our products and brand of $408,773, employee payroll costs of $574,378, including $112,500 for severance costs for our former Chief Marketing Officer (“CMO”), which was partially offset by stock-based compensation benefit of $55,071 for cancellation of unvested share-based awards to the CMO and other marketing employees whose positions were eliminated in the period. Travel expenses related to roadshows showcasing the Stag and EVO were $51,966 and facilities costs were $52,803. Professional fees for legal and consulting services were $84,336. Depreciation expense was $49,935 and bad debt expense was reduced by $16,378 due to collection of previously expensed customer accounts.
Previous wording
General and administrative expenses were $1,561,657 for the three months ended March 31, 2025, and were primarily related to expenses associated with employee payroll costs of $550,402, professional fees of $260,187 (including auditor fees of $77,250, legal fees of $58,697 and consulting fees of $124,240), software costs of $123,629, insurance costs of $450,388, and board compensation expense of $50,000.
Current wording
General and administrative expenses were $2,879,335 for the three months ended June 30, 2025, and were primarily related to expenses associated with employee payroll costs of $541,424, stock-based compensation of $1,125,802 for share-based awards granted to employees, professional fees of $190,954 (including auditor fees of $23,175, legal fees of $127,135 and consulting fees of $40,644), software costs of $121,655, insurance costs of $454,371 and travel expenses of $65,805. Public company expense costs of $123,147, annual meeting costs of $74,450 and Board compensation expense of $50,000.
Previous wording
Interest and other income/expenses for thethree months ended March 31, 2024 was $21,803,709. Non-cash interest expense of $314,838 was recognized for the amortization of debt issuance costs and accretion of principal on the May 2023 Notes through the date these notes were exchanged for Preferred Stock. We recorded a loss on the conversion of some of these notes of $333,544 and a loss from the exchange of these notes for Preferred Stock of $1,314,064. We recorded a loss on the change in the estimated fair value of the Series A and Series B Warrant liabilities of $20,004,342 which was partially offset by a gain of $165,355 from the exercise of some of the Series B Warrants.
Current wording
Interest and other income/expenses for the six months ended June 30, 2024 was $16,880,826. Non-cash interest expense of $314,838 was recognized for the amortization of debt issuance costs and accretion of principal on the May 2023 Notes through the date these notes were exchanged for Preferred Stock in March 2024. We recorded a loss on the conversion of some of these notes of $333,544 and a loss from the exchange of these notes for Preferred Stock of $1,314,065. Non-cash interest expense of $183,819 was recognized for the amortization of debt issuance costs and accretion of principal on the May 2024 Notes. We recorded a loss on the change in the estimated fair value of the Series A and Series B Warrant liabilities of $14,727,696 which was partially offset by a gain of $165,355 from the exercise of some of the Series B Warrants.
Previous wording
Net loss for the three months ended March 31, 2025 was $2,460,430. Net loss for the three months ended March 31, 2024, was $26,048,044.
Current wording
Net loss for the three and six months ended June 30, 2025 was $3,899,897 and $6,360,327, respectively.
Previous wording
On March 31, 2025, we had cash, cash equivalents and restricted cash of $17.7 million, including $0.1 million of restricted cash, and we had working capital of $16.4 million. Since inception we have funded our operations from proceeds from debt and equity sales.
Current wording
On June 30, 2025, we had cash, cash equivalents and restricted cash of $11.9 million, including $0.1 million of restricted cash, and we had working capital of $13.0 million. Since inception we have funded our operations from proceeds from debt and equity sales.
Previous wording
Net cash used in operating activities was $3.6 million for the three months ended March 31, 2025 and includes all of our operating costs, except non-cash costs of depreciation and amortization, loss on change in derivative financial liabilities and stock-based compensation, all of which were insignificant for the period. Significant uses/contributions of cash used in operating activities includes a decrease of $0.4 million in inventory and inventory deposits, an increase of $0.4 million in prepaid assets, a decrease of $0.2 million in accounts payable, and a decrease of $0.7 million in accrued liabilities primarily due to payments on vendor settlements, $0.1 million used to pay our lease liabilities and $0.2 million for fulfillment of sales where customers had previously placed deposits.
Current wording
Net cash used in operating activities was $7.2 million for the six months ended June 30, 2025 and includes all of our operating costs, except non-cash costs of depreciation and amortization, loss on change in derivative financial liabilities all of which were insignificant for the period and stock-based compensation of $1.1 million. Significant uses/contributions of cash used in operating activities includes a decrease of $0.2 million in inventory and inventory deposits, a decrease of $0.2 million in accounts payable, and a decrease of $1.5 million in accrued liabilities primarily due to payments on vendor settlements, $0.2 million used to pay our lease liabilities and $0.2 million for fulfillment of sales where customers had previously placed deposits.
Previous wording
Net cash used in operating activities was $4.5 million for the three months ended March 31, 2024 and includes all of our operating costs except depreciation and amortization of $0.1 million, non-cash interest expense for the amortization of debt issuance costs and accretion of principal on the May 2023 Notes of $0.3 million, loss on change in derivative financial liabilities of $20.0 million, losses on conversion and exchange of Convertible Notes of $1.6 million and $0.2 million from the loss on disposal of fixed assets. Cash used in operating activities includes an increase in accounts receivable of $0.1 million due to sales to our U.S. dealers, an increase of $0.5 million in prepaid inventory deposits primarily for purchases of Stag raw materials, a decrease of $0.5 million in accounts payable, and an increase of $0.3 million in accrued liabilities. As of March 31, 2024, we have a decrease of $0.3 million in customer deposits, primarily due to orders being fulfilled for two of our Latin American distributors for shipments of Brats and Grunt EVOs paid for previously.
Current wording
Net cash used in operating activities was $8.2 million for the six months ended June 30, 2024 and includes all of our operating costs except depreciation and amortization of $0.2 million, non-cash interest expense for the amortization of debt issuance costs and accretion of principal on the May 2023 Notes and May 2024 Notes of $0.5 million, loss on change in derivative financial liabilities of $14.9 million, losses on conversion and exchange of Convertible Notes of $1.6 million and $0.6 million from the loss on disposal of fixed assets. Cash used in operating activities includes an increase in accounts receivable of $0.1 million due to sales to our U.S. dealers, an increase of $1.1 million in prepaid inventory deposits primarily for purchases of Stag raw materials, an increase of $0.1 million in accounts payable, and an increase of $1.1 million in accrued liabilities primarily due to the vendor settlement noted above and $0.2 million used to pay our lease liabilities. As of June 30, 2024, we have a decrease of $0.2 million in customer deposits, primarily due to orders being fulfilled for two of our Latin American distributors for shipments of Brats and Grunt EVOs paid for previously.
Previous wording
Net cash used in investing activities was $0.2 million for the three months ended March 31, 2025, primarily consisting of purchases of equipment and tooling.
Current wording
Net cash used in investing activities was $2.2 million for the six months ended June 30, 2025, primarily consisting of the purchase of a certificate of deposit $2.0 million as collateral for our dealer floor plan financing and $0.2 million for purchases of equipment and tooling.
Previous wording
Net cash used in investing activities was $0.1 million for the three months ended March 31, 2024, primarily consisting of $0.1 million of purchases of equipment and tooling.
Current wording
Net cash used in investing activities was $0.2 million for the six months ended June 30, 2024, primarily consisting of $0.3 million of purchases of equipment and tooling offset by $0.1 million received from an insurance settlement for a vehicle that was totaled in the period.
Previous wording
Cash provided by financing activities for the three months ended March 31, 2025, was $19.1 million and was primarily related to proceeds of $8.8 million from the sale of our common stock from the At the Market offering, proceeds of $10.7 million from the sale of common stock units and prefunded warrant units, partially offset by share repurchases of $0.4 million.
Current wording
Cash provided by financing activities for the six months ended June 30, 2025, was $19.0 million and was primarily related to proceeds of $8.8 million from the sale of our common stock from the At the Market offering, proceeds of $10.7 million from the sale of common stock units and pre-funded warrant units, partially offset by share repurchases of $0.5 million.
Previous wording
Cash provided by financing activities for the three months ended March 31, 2024, was $0.1 million and was primarily related to proceeds from the exercise of Series B Warrants.
Current wording
Cash provided by financing activities for the six months ended June 30, 2024, was $2.3 million and was primarily related to the net proceeds from the issuance of the May 2024 Senior Notes and May 2024 Note Warrants.
Previous wording
Our continuation as a going concern is dependent upon our ability to attain profitable operations and if necessary, obtain continued financial support from the issuance of debt or equity. As of March 31, 2025, we had incurred an accumulated deficit of $168.8 million since inception.
Current wording
As of June 30, 2025, we had incurred an accumulated deficit of $172.7 million since inception.
Previous wording
Management anticipates that our cash and cash equivalents on hand as of March 31, 2025 will not be sufficient to fund planned operations beyond one year from the date of the issuance of the financial statements as of and for the three months ended March 31, 2025. We do not have any current commitments for future financing, and there can be no assurance that such additional funding would be available to the Company on acceptable terms, or at all. If we are unable to raise additional financing, we will be required to modify or curtail our operations. These factors raise substantial doubt regarding our ability to continue as a going concern.
Current wording
Management anticipates that our cash on hand as of June 30, 2025, plus cash expected to be generated from operations and the cash received from the Private Placements will be sufficient to fund planned operations beyond one year from the date of the issuance of the financial statements as of and for the six months ended June 30, 2025.
Previous wording
The recently enacted JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended, for complying with new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have irrevocably elected not to avail ourselves of this extended transition period and, as a result, we will adopt new or revised accounting standards on the relevant dates on which adoption of such standards is required for other public companies.
Current wording
The Jumpstart Our Business Startups Act of 2012, as amended (the “JOBS Act”) provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act, for complying with new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have irrevocably elected not to avail ourselves of this extended transition period and, as a result, we will adopt new or revised accounting standards on the relevant dates on which adoption of such standards is required for other public companies.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Interest and other income/expenses for the three months ended June 30, 2024 was $4,922,883. Non-cash interest expense of $183,819 was recognized for the amortization of debt issuance costs and accretion of principal on the May 2024 Notes. We recorded a gain on the change in the estimated fair value of the Series A and Series B Warrant liabilities of $5,111,291. The Series B Warrants were modified in May 2024 and were no longer derivatives as of the modification date.