Cycurion, Inc.

Our primary sources of liquidity are cash on hand, cash from operations, borrowings under our debt financing arrangements and equity raises through our equity line. As of September 30, 2025, we had $3.7 million in cash and cash equivalents. We believe that our current cash position, access to the capital markets and cash flow generated from operations should be sufficient for our operating requirements through the next several fiscal years.

Cash Flow

Net Cash Used In Operating Activities

For the nine months ended September 30, 2025, net cash used by operating activities was $8.8 million, compared to $1.2 million for the nine months ended September 30, 2024. The main driver of this increase is the additional merger expenses incurred in 2025.

Net Cash Provided By/(Used In) Investing Activities

For the nine months ended September 30, 2025, net cash provided in investing activities was approximately $1.6 million, compared to a $0.7 million use of cash for the nine months ended September 30, 2024. The cash inflow in 2025 was a result of the Trust Account for redemption and cash released from the Trust Account to the Company.

Net Cash Provided by Financing Activities

For the nine months ended September 30, 2025, net cash provided by financing activities was $10.8 million. The net cash provided includes $5.9 million in proceeds from the equity line of credit, $3.7 million proceeds provided from the exercise of warrants, $2.4 million in proceeds from convertible notes payable, $0.5 million in proceeds provided from notes payable, partially offset by a cash outflow of $1.0 million cash used in redemption of common stock.

For the nine months ended September 30, 2024, net cash provided by financing activities was $1.3 million. The Company received $1.0 million from a private placement.

Going Concern

We have incurred operating losses since inception through the period ended September 30, 2025, having had negative cash flow from operations. As of September 30, 2025, we had an accumulated deficit of approximately $21.8 million, as compared to our accumulated deficit of approximately $3.2 million as of December 31, 2024. The increase of our accumulated deficit was a result of our net losses for the nine months ended September 30, 2025.

Furthermore, we expect continued, significant operating losses for the next few years. We also utilized cash in operations of approximately $8.8 million in the nine months ended September 30, 2025. As of September 30, 2025, we had unrestricted cash of approximately $3.7 million, an increase of $3.6 million from approximately $38,742 as of December 31, 2024. As of September 30, 2025, our total assets increased to approximately $32.3 million from approximately $25.6 million as of December 31, 2024, primarily due to increases in goodwill. Based on our current capital resources as of September 30, 2025, including our unrestricted cash and accounts receivable, net of $6.7 million, we expect to be able to continue our operations for a minimum of 12 months as of the date of this quarterly report. Nevertheless, our continuation as a going concern is dependent on our ability to obtain additional financing until we can generate sufficient, consistent cash flow from operations to meet the expected growth in our obligations. We intend to continue to seek additional debt or equity financing to continue our operations.

Our consolidated financial statements have been prepared on a going concern basis, which implies we may not continue to meet our obligations and continue our operations for the next fiscal year. The continuation of our Company as a going concern is dependent upon our ability to obtain necessary debt or equity financing to continue operations until we begin generating positive cash flow.

There is no assurance that we will ever be consistently profitable or, notwithstanding our recent financing activities, that debt or equity financing will be available to us in the amounts, on terms, and at times deemed acceptable to us, if at all. The issuance of additional equity securities by us would result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, would increase our liabilities and future cash commitments. If we are unable to obtain financing in the amounts and on terms deemed acceptable to us, we may be unable to continue our business, as planned, and as a result may be required to scale back or cease operations for our business, the result of which would be that our stockholders would lose some or all of their investment. The consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should we be unable to continue as a going concern.

Off-balance sheet arrangements

We did not have any off-balance sheet arrangements during the periods presented, and we do not currently have any off-balance sheet arrangements, as defined in the SEC rules and regulations.