Beam Global 10-Q

Beam Global 10-Q Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Period ended March 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________________ to ________________ Commission File Number 001-38868 Beam Global (Exact name of Registrant as specified in its charter) Nevada 26-1342810 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification Number) 5660 Eastgate Dr. San Diego , California 92121 (Address of principal executive offices) (Zip Code) ( 858 ) 799-4583 (Registrant’s telephone number, including area code) _____________________________________________ (Former name, former address and formal fiscal year, if changed since last report) Securities registered pursuant to Section 12(b) of the Act: Title of each class Trading Symbol(s) Name of each exchange in which registered Common stock, $0.001 par value BEEM Nasdaq Capital Market Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐ Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐ Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company under Rule 12b-2 of the Exchange Act. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated Filer ☒ Smaller reporting company ☒ Emerging growth company ☐ If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐ Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒ The number of registrant's shares of common stock, $0.001 par value outstanding as of May 11, 2025 was 15,426,178 . TABLE OF CONTENTS Page PART I FINANCIAL INFORMATION 3 Item 1. Financial Statements (Unaudited) 3 Condensed Consolidated Balance Sheets at March 31, 2025 and December 31, 2024 3 Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three Months Ended March 31, 2025 and 2024 4 Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Three Months Ended March 31, 2025 and 2024 5 Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2025 and 2024 6 Notes To Condensed Consolidated Financial Statements 7 Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 23 Item 3. Quantitative and Qualitative Disclosures About Market Risk 31 Item 4. Controls and Procedures 31 PART II OTHER INFORMATION 33 Item 1. Legal Proceedings 33 Item 1A. Risk Factors 33 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 33 Item 3. Defaults Upon Senior Securities 33 Item 4. Mine Safety Disclosures 33 Item 5. Other Information 33 Item 6. Exhibits 34 SIGNATURES 36 2 PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS Beam Global Condensed Consolidated Balance Sheets (In thousands, except share and per share data) Three Months Ended March 31, December 31, 2025 2024 (Unaudited) Assets Current assets Cash $ 2,504 $ 4,572 Accounts receivable, net of allowance for credit losses of $ 498 and $ 259 7,145 8,027 Prepaid expenses and other current assets 2,150 2,243 Inventory, net 11,845 12,284 Total current assets 23,644 27,126 Property and equipment, net 13,531 13,704 Operating lease right of use assets 1,650 1,893 Goodwill – 10,580 Intangible assets, net 7,810 8,037 Deposits 120 119 Total assets $ 46,755 $ 61,459 Liabilities and Stockholders' Equity Current liabilities Accounts payable $ 8,316 $ 8,959 Accrued expenses 2,393 2,462 Sales tax payable 435 195 Deferred revenue, current 1,042 847 Note payable, current 64 63 Contingent consideration, current 93 93 Operating lease liabilities, current 539 696 Total current liabilities 12,882 13,315 Deferred revenue, noncurrent 857 800 Note payable, noncurrent 182 199 Contingent consideration, noncurrent 216 216 Other liabilities, noncurrent 3,432 3,380 Deferred tax liabilities, noncurrent 1,609 1,290 Operating lease liabilities, noncurrent 905 971 Total liabilities 20,083 20,171 Commitments and contingencies (Note 10) – Stockholders' equity Preferred stock, $ 0.001 par value, 10,000,000 authorized, none outstanding as of March 31, 2025 and December 31, 2024. – – Common stock, $ 0.001 par value, 350,000,000 shares authorized, 15,043,045 and 14,835,630 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively. 15 15 Additional paid-in-capital 147,518 147,072 Accumulated deficit ( 120,166 ) ( 104,643 ) Accumulated Other Comprehensive Income (AOCI) ( 695 ) ( 1,156 ) Total stockholders' equity 26,672 41,288 Total liabilities and stockholders' equity $ 46,755 $ 61,459 The accompanying unaudited notes are an integral part of these unaudited condensed consolidated Financial Statements 3 Beam Global Condensed Consolidated Statement of Operations and Comprehensive Loss (Unaudited, in thousands except per share data) Three Months Ended March 31, 2025 2024 Revenues $ 6,324 $ 14,561 Cost of revenues 5,823 13,082 Gross profit 501 1,479 Operating expenses 5,265 4,527 Impairment of goodwill 10,780 – Loss from operations ( 15,544 ) ( 3,048 ) Other income (expense) Interest income 23 71 Other income (expense) 4 ( 56 ) Interest expense ( 6 ) ( 4 ) Other income 21 11 Loss before income tax expense ( 15,523 ) ( 3,037 ) Net Loss $ ( 15,523 ) $ ( 3,037 ) Net foreign currency translation benefit (expense) 461 ( 329 ) Total Comprehensive Loss $ ( 15,062 ) $ ( 3,366 ) Net Loss per share - basic/diluted $ ( 1.04 ) $ ( 0.21 ) Weighted average shares outstanding - basic/diluted 14,990 14,422 The accompanying unaudited notes are an integral part of these unaudited condensed consolidated financial statements 4 Beam Global Consolidated Statements of Changes in Stockholders’ Equity (Unaudited, in thousands) Common Stock Additional Paid-in- Accumulated Accumulated Other Comprehensive Total Stockholders' Stock Amount Capital Deficit Income Equity Balance at December 31, 2024 14,919 15 $ 147,072 $ ( 104,643 ) $ ( 1,156 ) $ 41,288 Stock issued for director services - vested 30 – 94 – – 94 Stock issued to (released from) escrow account - unvested 94 – – – – – Employee stock-based compensation expense – – 352 – – 352 Impact of foreign currency translation – – – – 461 461 Net income (loss) – – – ( 15,523 ) – ( 15,523 ) Balance at March 31, 2025 15,043 15 $ 147,518 $ ( 120,166 ) $ ( 695 ) $ 26,672 Balance at December 31, 2023 14,398 $ 14 $ 142,265 $ ( 93,361 ) $ 624 $ 49,542 Stock issued for director services - vested – – 6 – – 6 Employee stock-based compensation expense – – 468 – – 468 Warrants exercised for cash 40 – 252 – – 252 Impact of foreign currency translation – – – – ( 329 ) ( 329 ) Net income (loss) – – – ( 3,037 ) – ( 3,037 ) Balance at March 31, 2024 14,438 $ 14 $ 142,991 $ ( 96,398 ) $ 295 $ 46,902 The accompanying unaudited notes are an integral part of these unaudited condensed consolidated Financial Statements 5 Beam Global Condensed Consolidated Statements of Cash Flows (Unaudited, in thousands) Three Months Ending March 31, 2025 2024 Operating Activities: Net loss $ ( 15,523 ) $ ( 3,037 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 955 930 Provision on credit losses 239 ( 336 ) Change in fair value of contingent consideration liabilities – ( 147 ) Impairment of goodwill 10,780 – Employee stock-based compensation 521 554 Disposal of property and equipment 23 27 Amortization of operating lease right of use asset 30 36 Changes in assets and liabilities: (Increase) decrease in: Accounts receivable 730 ( 3,901 ) Prepaid expenses and other current assets 39 151 Inventory 595 425 Deposits ( 1 ) ( 36 ) Increase (decrease) in: Accounts payable ( 745 ) 956 Accrued expenses ( 101 ) 1,082 Sales tax payable 238 2 Deferred revenue 229 258 Other long term liabilities 231 10 Net cash used in operating activities ( 1,760 ) ( 3,026 ) Investing Activities: Purchase of property and equipment ( 54 ) ( 104 ) Payment of deferred consideration – ( 2,713 ) Funding of patent costs ( 16 ) – Net cash used in investing activities ( 70 ) ( 2,817 ) Financing Activities: Proceeds from warrant exercises – 252 Repayments of note payable ( 15 ) – Borrowings of note payable – 25 Net cash provided (used) by financing activities ( 15 ) 277 Effect of exchange rate changes ( 223 ) 135 Net decrease in cash ( 2,068 ) ( 5,431 ) Cash at beginning of period 4,572 10,393 Cash at end of period $ 2,504 $ 4,962 Supplemental Disclosure of Cash Flow Information: Cash paid for interest $ 6 $ 4 Cash paid for taxes $ – $ – Supplemental Disclosure of Non-Cash Investing and Financing Activities: Purchase of property and equipment by incurring current liabilities $ – $ 104 Right-of-use assets obtained in exchange for lease liabilities $ – $ 1,223 The accompanying unaudited notes are an integral part of these unaudited condensed consolidated Financial Statements 6 BEAM GLOBAL NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. NATURE OF OPERATIONS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Operations References in this Report to “we,” “us,” “our,” the “Company” or “Beam” means Beam Global, a Nevada corporation, and its subsidiaries. Beam is a clean-technology innovation company headquartered in San Diego, California with factories in the U.S. in San Diego, California and Broadview, Illinois and in Europe in Belgrade and Kraljevo, Serbia. We develop, design, engineer, manufacture, and sell high-quality, renewably energized infrastructure products for electric vehicle (“EV”) charging, infrastructure for Smart Cities (the interconnected physical and digital elements within a city that utilize technology to enhance efficiency, sustainability, and quality of life for residents), energy security and disaster preparedness and highly energy-dense battery solutions in safe, compact and unique form-factors. Additionally, we manufacture steel structures with electronic integration such as street lighting, cell towers and energy infrastructure products as well as power electronics including invertors, charge controllers, power supplies and LED lighting. Beam’s energy storage products provide high energy density in safe, compact and bespoke form-factors, which we believe are ideal for the rapidly growing mobile and stationary equipment product market which often requires electrical energy without being connected to the electrical grid. Beam’s products and proprietary technology solutions target the following markets : · Energy security and disaster preparedness; · Smart Cities infrastructure; · Energy storage solutions; · EV charging infrastructure; · Transportation infrastructure products; and · Power electronics and telecommunications equipment Basis of Presentation The interim unaudited condensed consolidated financial statements included herein have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial statements and are in the form prescribed by the Securities and Exchange Commission in instructions to Form 10-Q and Rule 10-01 of Regulation S-X. In management’s opinion, all adjustments (consisting of normal recurring adjustments and reclassifications) necessary to present fairly our results of operations and cash flows for the three months ended March 31, 2025 and 2024, and our financial position as of March 31, 2025, have been made. The results of operations for such interim periods are not necessarily indicative of the operating results to be expected for the full year. Certain information and disclosures normally included in the notes to the annual financial statements have been condensed or omitted from these interim financial statements. Accordingly, these interim unaudited condensed consolidated financial statements should be read in conjunction with the financial statements and notes thereto for the year ended December 31, 2024. The December 31, 2024 balance sheet is derived from those statements. 7 Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates in the accompanying financial statements include the allowance for certain expected credit losses, valuation of inventory and standard cost allocations, depreciable lives of property and equipment, valuation of contingent consideration liability, valuation of intangible assets, estimates of loss contingencies, estimates of the valuation of lease liabilities and the related right of use assets, valuation of share-based costs, and the valuation allowance on deferred tax assets. Recent Accounting Pronouncements Recent pronouncement not yet adopted In October 2023, the FASB issued ASU 2023-06, “Disclosure Improvements” (“ASU 2023-06”), which amends the disclosure or presentation requirements related to various subtopics in the FASB Accounting Standards Codification (the “Codification”). The ASU was issued in response to the SEC’s disclosure update and simplification initiative issued in August 2018. The effective date for the amendments for each topic will be the date on which the SEC’s removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoptions prohibited. In December 2023, the FASB issued ASU No. 2023-09, “ Income Taxes (Topic 740): Improvements to Income Tax Disclosures ” (“ASU 2023-09”). ASU 2023-09 requires disaggregated information about a company’s effective tax rate reconciliation and information on income taxes paid. This standard will be effective for Beam beginning with our annual financial statements for the fiscal year ending December 31, 2025. Early adoption is permitted. The Company is currently evaluating the impact that the updated standard will have on our consolidated financial statements. Concentrations Credit Risk Financial instruments that potentially subject us to concentrations of credit risk consist of cash and accounts receivable. The Company maintains its cash in banks and financial institutions deposits that at times may exceed federally insured limits. The Company has not experienced any losses in such accounts from inception through March 31, 2025. As of March 31, 2025, approximately $ 1.5 million of the Company’s cash deposits were greater than the federally insured limits. Major Customers For the three months ended March 31, 2025, one customer accounted for 12 % of total revenues and for the three months ended March 31, 2024, two customers accounted for 30 % and 18 % of total revenues, each with no other single customer accounting for more than 10% of revenues. At March 31, 2025, accounts receivable from one customer accounted for 15 % of total accounts receivable and at March 31, 2024, accounts receivable from three customers accounted for 22 %, 18 % and 14 % of total accounts receivable each with no other single customer accounting for more than 10% of the accounts receivable balance. For the three months ended March 31, 2025 and 2024, the Company’s concentration of sales to federal customers represented 14 % and 58 % of revenues, respectively and the concentration of sales to state and local governments represented 33 % and 26 % of revenues, respectively. 8 Foreign Operations The following summarizes key financial metrics associated with the Company’s continuing operations: Schedule of concentration risk March 31, 2025 2024 Assets - Serbia $ 19,363 $ 24,009 Assets - U.S. 27,392 51,644 Total Assets $ 46,755 $ 75,653 Liabilities - Serbia $ 11,365 $ 9,173 Liabilities - U.S. 8,718 19,581 Total Liabilities $ 20,083 $ 28,754 March 31, 2025 2024 Sales - Serbia $ 1,526 $ 1,429 Sales - U.S. 4,798 13,132 Total Revenues $ 6,324 $ 14,561 Net Loss - Serbia $ ( 6,691 ) $ ( 372 ) Net Loss - U.S. ( 8,832 ) ( 2,665 ) Total Net Loss* $ ( 15,523 ) $ ( 3,037 ) * Total Net Loss for the three months ending March 31, 2025 was $15.5 million compared to $3.0 million in 2024. The 2025 net loss increase mainly included $ 10.8 million of non-cash impairment for Goodwill and $0.4 million in allowances for credit losses. Impairment of Goodwill The Company operates as one operating segment and reporting unit and therefore evaluates goodwill for impairment as one singular reporting unit annually during the fourth quarter or more often when an event occurs, or circumstances indicate the carrying value may not be recoverable. The determination of the fair value of the reporting unit requires us to make significant estimates and assumptions. Due to the inherent uncertainty involved in making these estimates, actual future results could differ. Changes in assumptions regarding future results or other underlying assumptions could have a significant impact on the fair value of the reporting unit. 9 During the three months ending March 31, 2025, the Company continued to experience a decline in its stock price resulting in the total market value of its common stock outstanding (“market capitalization”) being less than the carrying value of the reporting unit. Management believes this decline in market value is due to a variety of factors, as further described below. Considering the circumstances and indicators of potential impairment described above, management performed an interim quantitative goodwill impairment test as of March 31, 2025. Management first considered whether any impairment was present for the Company’s long-lived assets, concluding that no such impairments were present. The Company does not have any indefinite lived assets other than goodwill. The Company concluded that the sustained stock price decline in the Company’s common stock and its market capitalizations as of March 31, 2025 is a triggering event which requires us to perform a quantitative goodwill impairment test. We determine the value of goodwill largely based on our stock price. The results of the Company’s test for impairment of goodwill as of March 31, 2025, utilizing recent trends in stock price over a reasonable period, indicated that the fair value of goodwill fell below its book value. Based on the results of the goodwill impairment procedures, the Company recorded a $ 10.8 million goodwill impairment for the single reporting unit during the three months ended March 31, 2025. Accounts Receivable The Company does business and extends credit based on an evaluation of each customer’s financial condition, generally without requiring collateral. Management reviews accounts receivable on a periodic basis to determine if any receivables may become uncollectible. Management’s evaluation includes several factors including the aging of the accounts receivable balances, a review of significant past due accounts, dialogue with the customer, the financial profile of a customer, our historical write-off experience, net of recoveries, and economic conditions. Exposure to losses on receivables is expected to vary by customer due to the financial condition of each customer. The Company estimates future credit losses based on the age of customer receivable balances, collection history and forecasted economic trends. The Company monitors exposure to credit losses and maintains allowances for anticipated losses considered necessary under the circumstances. A summary of the allowance for credit losses for the three months ended March 31, 2025 and December 31, 2024: Schedule of accounts receivable March 31, December 31, (Dollars in thousands) 2025 2024 Allowance for credit losses: Beginning of period $ 259 $ 448 Net provision for credit losses 239 ( 72 ) (Charge-offs)/recoveries, net – ( 117 ) End of Period $ 498 $ 259 10 Fair Value Measurement The Company follows the authoritative guidance that establishes a formal framework for measuring fair values of assets and liabilities in the consolidated financial statements that are already required by generally accepted accounting principles to be measured at fair value. The guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The transaction is based on a hypothetical transaction in the principal or most advantageous market considered from the perspective of the market participant that holds the asset or owes the liability. The Company utilizes market data or assumptions that market participants who are independent, knowledgeable, and willing and able to transact would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated or generally unobservable. The Company attempts to utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. The Company is able to classify fair value balances based on the observability of those inputs. The guidance establishes a formal fair value hierarchy based on the inputs used to measure fair value. The hierarchy gives the highest priority to Level 1 measurements and the lowest priority to level 3 measurements, and accordingly, Level 1 measurement should be used whenever possible. The hierarchy is broken down into three levels based on the reliability of inputs as follows: Level 1 – Quoted prices in active markets for identical assets or liabilities or published net asset value for alternative investments with characteristics similar to a mutual fund. Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 – Unobservable inputs for the asset or liability. The methods used may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while management believes its valuation methods are appropriate, the fair value of certain financial instruments could result in a difference fair value measurement at the reporting date. There were no changes in the Company’s valuation methodologies from the prior year. For purpose of this disclosure, the carrying amounts for financial assets and liabilities such as cash and cash equivalents, accounts receivable – trade, other prepaid expenses and current assets, accounts payable and other current liabilities, all approximate fair value due to their short-term nature as of March 31, 2025. The Company had Level 3 liabilities as of March 31, 2025. There were no transfers between levels during the reporting period. Schedule of contingent consideration Level 1 Level 2 Level 3 Contingent Consideration as of December 31, 2024 – – $ 309 Additions – Change in fair value – Contingent Consideration as of March 31, 2025 – – $ 309 11 Significant Accounting Policies During the three months ended March 31, 2025, there were no changes to our significant accounting policies as described in our Annual Report on Form 10-K for the year ended December 31, 2024. Net Loss Per Share Basic net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding during the periods presented. Diluted net loss per common share is computed using the weighted average number of common stock outstanding for the period, and, if dilutive, potential common stock outstanding during the period. Potential common stock consists of the incremental shares of common stock issuable upon the exercise of stock options, stock warrants, convertible debt instruments or other common stock equivalents. Potentially dilutive securities are excluded from the computation if their effect is anti-dilutive. The following shares were not included in the computation of diluted loss per share: Schedule of anti-dilutive March 31, 2025 2024 Stock Options 650,904 592,658 Warrants 200,000 570,718 Total Shares 850,904 1,163,376 Segments The Company assesses its segment reporting based on how it internally manages and reports the results of its business to its chief operating decision maker. Management reviews financial results, manages the business and allocates resources on an aggregate basis. Therefore, financial results are reported in a single operating segment. 12 2. LIQUIDITY The Company had net losses of $ 15.5 million (which includes $ 12.5 million of non-cash expenses) and $ 3 .0 million (which includes $ 1.1 million of non-cash expenses) and net cash used in operating activities of $ 1.8 million and $ 3 .0 million for the three months ended March 31, 2025 and 2024, respectively. At March 31, 2025, the Company had a cash balance of $ 2.5 million and working capital of $ 10.8 million. Based on the Company’s current operating plan and the available working capital that it believes can be converted to cash (specifically the accounts receivable balance of approximately $ 7.1 million), the Company believes that it has the ability to fund its operations and meet contractual obligations for at least twelve months from the date of this report. On April 11, 2025, the Company entered into an At Market Issuance Sales Agreement with B. Riley Securities, Inc., pursuant to which the Company has the right, but not the obligation, to sell up to $ 8 million in shares of its common stock, subject to certain terms and conditions. In March 2023, the Company entered into a supply chain line of credit agreement with OCI Group for up to $100 million to further support our working capital requirements. Subject to the terms of the agreement, OCI Group will make available to the Company funding based on amounts owed to the Company by its customers. To date, the Company has not borrowed against this line of credit. Although the Company believes that it will become profitable in the next few years as our revenues grow, our gross profit improves and we leverage our overhead costs, we expect to continue to incur losses for a period of time. If necessary, the Company may raise additional capital to finance its future operations through equity or debt financings. There is no guarantee that profitable operations will be achieved, or that additional capital or debt financing will be available on a timely basis, on favorable terms, or at all, and such funding, if raised, may not be sufficient to meet our obligations or enable us to continue to implement our long-term business strategy. In addition, obtaining additional funding or entering into other strategic transactions could result in significant dilution to our stockholders. 3. BUSINESS COMBINATIONS Telcom On August 30, 2024, the Company acquired Telcom d.o.o Beograd (“Telcom”), pursuant to a Share Sale and Purchase Agreement dated as of August 30, 2024 (the “Telcom Agreement”) with the owners (the “Telcom Sellers”) of Telcom. Telcom is a business located in Serbia and engaged in the manufacturing of telecommunications equipment. Beam acquired all of the equity stock of Telcom from the Telcom Sellers in exchange for cash and Beam common stock. The total purchase price was subject to adjustment based on the amount of cash held by Telcom at closing. Based on Telcom’s cash balance at closing equal to approximately EUR 220,298 , Beam paid to the Telcom Sellers a purchase price equal to EUR 815,298 which was paid to the Telcom Sellers as follows: (i) EUR 430,000 cash and (ii) issued 82,506 shares of Beam common stock. At closing, Telcom had a positive working capital balance of approximately EUR 500,000 which consisted of (i) a cash balance equal to EUR 220,000, accounts receivables of approximately EUR 115,000, inventory of approximately EUR 275,000 and accounts payable of approximately EUR 110,000. In addition to the above payments, the Telcom Sellers are eligible to earn up to EUR 250,000 (the “Earnout Cap”) in additional shares of Beam common stock if Telcom meets certain revenue milestones for fiscal years 2024 and 2025 (the “Telcom Earnout Consideration”). The Telcom Earnout Consideration that the Telcom Sellers are eligible to receive for 2024 was equal to the amount the net revenue of Telcom (“Telcom Net Revenue”) exceeded EUR 850,000 for 2024 up to the Earnout Cap. The Company issued 27,836 shares of stock valued at $ 0.1 million as payment for the 2024 Telcom Earnout Consideration. The Telcom Earnout Consideration was less than the Earnout Cap, and the Telcom Sellers will be eligible for additional Telcom Earnout Consideration in 2025 if (i) 2025 Telcom Net Revenue exceeds 2024 Telcom Net Revenue, and (ii) 2025 Telcom Net Revenue exceeds $850,000. The Telcom Earnout Consideration for 2025 will be calculated based on the amount the 2025 Net Revenue exceeds the 2024 Net Revenue subject to the Earnout Cap. In no event, will the Telcom Earnout Consideration for 2024 and 2025, in the aggregate, exceed the Earnout Cap. The Telcom Earnout Consideration for each period will be calculated based on the volume weighted average price of Beam’s common stock for the thirty trading days prior to the end of the applicable calendar year. In no event and under no circumstances will the Telcom Sellers receive from Beam or will Beam issue to the Telcom Sellers in connection with the transaction Beam’s common stock in an amount that exceeds 19.99% of the outstanding common stock of Beam immediately prior to closing. 13 The acquisition was accounted for as a business combination in accordance with Accounting Standards Codification (ASC) 805, Business Combinations . Goodwill represents the premium the Company paid over net fair value of tangible and intangible assets acquired. The valuation of the Telcom Earnout Consideration was performed using a discounted cash flow analysis to determine the fair value of the contingent consideration, which includes estimates and assumptions such as forecasted revenues of Telcom, discount rates, and the milestone settlement value. As such valuation includes the use of unobservable inputs, it is considered to be a Level 3 measurement. The fair value of the Telcom Earnout Consideration will be reassessed on a quarterly basis with the change recorded to operating expenses. Change in the fair value of the Earnout Consideration during the three months ended March 31, 2025 is as follows (in thousands): Schedule of change in the fair value of the earnout consideration Balance as of December 31, 2024 $ 259 Change in Fair Value – Balance as of March 31, 2025 $ 259 The following table summarizes the estimated fair value allocation of consideration exchanged for the estimated fair value of tangible assets acquired and liabilities assumed at the acquisition date. The estimated fair value for working capital is generally equivalent to the net book value of the acquired assets and liabilities on the acquisition date. Fair value assigned to property, plant and equipment is based on real estate appraisals, market value comparisons, or acquired net book value of recently acquired assets. The valuation of the contingent consideration is based on a discounted cash flow analysis using the Company’s forecasted results for the operations for the two years subject to revenue earn-out targets. Consideration is comprised of the following (in thousands): Schedule of consideration comprised Cash $ 481 Common Stock 387 Earnout Consideration 276 Total Consideration $ 1,144 The following table shows the allocation of consideration to assets and liabilities at fair value (in thousands): Schedule of consideration to assets and liabilities Assets Acquired Cash and cash equivalents $ 244 Accounts Receivable 224 Inventory 296 Prepaid expenses 2 Property, plant and equipment 30 Goodwill 692 Total assets acquired $ 1,488 Liabilities Assumed Accounts payable $ 266 Accrued Expenses 10 Other liabilities 68 Total liabilities assumed $ 344 Net assets acquired $ 1,144 The Company believed it to be probable that the maximum amount of Telcom Earnout Consideration would be earned and therefore accrued the full amount in the opening balance sheet. The estimated fair values were assigned to identifiable assets acquired and liabilities. 14 Pro Forma Unaudited Financial Information The following unaudited pro forma financial information summarizes the combined results of operations of Beam Global and Telcom as if the company had been acquired as of the beginning of the three months ended March 31, 2024 (in thousands): Schedule of pro forma financial information March 31, 2024 Revenues $ 14,749 Net Loss $ ( 3,030 ) The pro forma financial information is presented for information purposes only and may not be indicative of the results of operations that would have been achieved had the acquisition been completed at the beginning of the three months ended March 31, 2024. In addition, the unaudited pro forma financial information is not a projection of future results of operations of the combined company, nor does it reflect the expected realization of any synergies or cost savings associated with the acquisition. The unaudited pro forma financial information includes adjustments to reflect the incremental amortization expense of the identifiable intangible assets and transaction costs. The statement of operations, in the table above, for the three months ended March 31, 2024 includes revenues of $ 0.2 million and income from operations of $ 8 thousand from the acquired Telcom business. 4. PREPAIDS AND OTHER CURRENT ASSETS Prepaid expenses and other current assets are summarized as follows (in thousands): Schedule of prepaid expenses and other current assets March 31, December 31, 2025 2024 Vendor prepayments $ 1,979 $ 1,884 Prepaid insurance 94 135 Other 77 224 Total prepaid expenses and other current assets $ 2,150 $ 2,243 5. INVENTORY Inventories are stated at the lower of cost and net realizable value. Costs are determined using the first in-first out (FIFO) method. As of March 31, 2025 and 2024, inventory consists of the following (in thousands): Schedule of inventory March 31, December 31, 2025 2024 Finished goods $ 4,597 $ 4,929 Work in process 1,063 1,147 Raw materials 6,185 6,208 Total inventory $ 11,845 $ 12,284 15 6. PROPERTY AND EQUIPMENT Property and equipment consist of the following (in thousands): Schedule of property and equipment March 31, December 31, 2025 2024 Office furniture and equipment $ 227 $ 227 Computer equipment and software 290 283 Land, buildings and leasehold improvements 7,868 7,528 Autos 770 769 Machinery and equipment 9,514 9,207 Total property and equipment 18,669 18,014 Less accumulated depreciation ( 5,138 ) ( 4,310 ) Property and Equipment, net $ 13,531 $ 13,704 Depreciation expense during the three months ended March 31, 2025 and 2024 was $ 0.7 million for both years. For the three months ended March 31, 2025 and 2024, depreciation expense recognized in Operating expenses was $ 0.1 million in both years and $ 0.6 million and $ 0.1 million in Cost of Goods Sold, respectively. 7. GOODWILL AND INTANGIBLE ASSETS The following table presents the Company's goodwill asset: Schedule of goodwill asset March 31, December 31, 2025 2024 Beginning balance $ 10,580 $ 10,270 Foreign exchange 200 ( 310 ) Impairments ( 10,780 ) – Ending balance $ – $ 10,580 Intangible assets, net, as of March 31, 2025 and 2024 consists of the following (in thousands): Schedule of intangible assets December 31, 2024 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted-average Amortization Period (yrs) Developed technology $ 8,074 $ ( 2,080 ) $ 5,994 11 Trade name 1,756 ( 498 ) 1,258 10 Customer relationships 444 ( 158 ) 286 13 Backlog 185 ( 185 ) – 1 Patents 576 ( 77 ) 499 20 Intangible assets $ 11,035 $ ( 2,998 ) $ 8,037 16 March 31, 2025 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted-average Amortization Period (yrs) Developed technology $ 8,074 $ ( 2,263 ) $ 5,811 11 Trade name 1,756 ( 541 ) 1,215 10 Customer relationships 443 ( 169 ) 274 13 Backlog 184 ( 185 ) – 1 Patents 592 ( 82 ) 510 20 Intangible assets $ 11,050 $ ( 3,240 ) $ 7,810 Amortization expense for each of the three months ended March 31, 2025, and 2024 was $ 0.2 million. Amortization expense for intangible assets held as of December 31, 2024, will be $ 1 .0 million for each of the years 2025 – 2028. Amortization expense recognized in Operating expenses for the three months ended March 31, 2025 and 2024 was $ 0.1 million and $ 0.2 million in Cost of Goods Sold, respectively. 8. ACCRUED EXPENSES AND LONG-TERM LIABILITIES The major components of accrued expenses and long-term liabilities are summarized as follows (in thousands): Schedule of major components of accrued expenses March 31, December 31, 2025 2024 Accrued Expenses: Accrued vacation $ 292 $ 271 Accrued salaries and bonus 1,442 1,498 Vendor accruals 254 75 Accrued warranty 6 6 Other accrued expense 399 612 Total accrued expenses $ 2,393 $ 2,462 Other Long-Term Liabilities: Long-term deferred tax liability $ 1,609 $ 1,290 Acquired long-term liability 3,432 3,380 Total long-term liabilities $ 5,041 $ 4,670 Acquired long-term liability of $ 3.4 million consists of a restructuring debt settlement from the acquisition of Amiga. Approximately $ 0.5 million is current and included in other accrued expenses and the rest is categorized in long-term liability. The debt restructuring was entered into in 2021 for a nine-year term with five years and 9 months remaining at March 31, 2025. Payments are interest free, not secured, and due quarterly as a percentage of the remaining balance due. $ 23 thousand consists of non-current liabilities related to the acquisition of Telcom. Approximately $ 32 thousand is current and included in other accrued expenses and the rest is categorized in long-term liability. 9. NOTE PAYABLE In May 2023, the Company purchased two new trucks and financed the purchase through an auto loan. The loan has a term of 60 months, requires monthly payments of approximately $ 4 thousand, and bears interest at a rate of 7.55 % per year. Payment on the loan began in July 2023, and the loan has a short-term balance of $ 43 thousand. In March 2024, the Company purchased a forklift and financed the purchase through an auto loan. The loan has a term of 60 months, requires monthly payments of approximately $ 661 , and bears interest at a rate of 6.54 % per year. Payment on the loan began in February 2024, and the loan has a short-term balance of $ 6 thousand. In April 2024, a second forklift was purchased and financed through an auto loan. The loan has a term of 60 months, requires monthly payments of approximately $ 1,661 , and bears interest at a rate of 7.89 % per year. Payment on the loan began in April 2024, and the loan has a short-term balance of $ 14 thousand. 17 10. COMMITMENTS AND CONTINGENCIES Legal Matters: The Company may from time to time become party to actions, claims, suits, investigations or proceedings arising from the ordinary course of our business, including actions with respect to intellectual property claims, breach of contract claims, labor and employment claims and other matters. Any litigation could divert management time and attention from the Company, could involve significant amounts of legal fees and other fees and expenses, or could result in an adverse outcome having a material adverse effect on our financial condition, cash flows or results of operations. Actions, claims, suits, investigations and proceedings are inherently uncertain, and their results cannot be predicted with certainty. We are not currently involved in any legal proceedings that we believe are, individually or in the aggregate, material to our business, results of operations or financial condition. However, regardless of the outcome, litigation can have an adverse impact on us because of associated cost and diversion of management time. As of March 31, 2025, after consulting with legal counsel, management believes there were no pending or threatened lawsuits that could reasonably be expected to have a material effect on the results of our operations. Other Commitments: The Company enters into various contracts or agreements in the normal course of business whereby such contracts or agreements may contain commitments. Since inception, the Company entered into agreements to act as a reseller for certain vendors; joint development contracts with third parties; referral agreements where the Company would pay a referral fee to the referrer for business generated; sales agent agreements whereby sales agents would receive a fee equal to a percentage of revenues generated by the agent; business development agreements and strategic alliance agreements where both parties agree to cooperate and provide business opportunities to each other and in some instances, provide for a right of first refusal with respect to certain projects of the other parties; agreements with vendors where the vendor may provide marketing, investor relations, public relations, software licenses, technical consulting or subcontractor services, vendor arrangements with non-binding minimum purchasing provisions, and financial advisory agreements where the financial advisor would receive a fee and/or commission for raising capital for the Company. 11. INCOME TAXES There was no Federal income tax expense for the three months ended March 31, 2025 or 2024 due to the Company’s net losses. Income tax expense represents the minimum state taxes due. As a result of the Company’s history of incurring operating losses, a full valuation allowance has been established. As of March 31, 2025, no benefit has been provided for the quarter-to-date loss. On a quarterly basis, the Company evaluates the positive and negative evidence to assess whether the more likely than not criteria have been satisfied in determining whether there will be further adjustments to the valuation allowance. 12. STOCKHOLDERS’ EQUITY At Market Issuance Sales Agreement On April 11, 2025, the Company entered into an At Market Issuance Sales Agreement (the “Sales Agreement”) with B. Riley Securities, Inc. (“B. Riley”), pursuant to which the Company has the right, but not the obligation, to sell shares of their common stock having an aggregate offering price of up to $ 8 million, subject to certain terms and conditions. Stock Options Stock options may be granted to new and existing employees and other eligible participants under the Company’s equity incentive plan. New employee option grants generally have a term of ten years and vest ratably over four years. 18 Option activity for the three months ended March 31, 2025 is as follows: Schedule of option activity Weighted Average Number of Exercise Options Price Outstanding at December 31, 2024 663,004 $ 6.69 Granted – – Forfeited ( 12,100 ) 10.03 Outstanding at March 31, 2025 650,904 $ 6.63 The fair value of each option is estimated on the date of grant using the Black-Scholes option-pricing model. This model incorporates certain assumptions for inputs including a risk-free market interest rate, expected dividend yield of the underlying common stock, expected option life and expected volatility in the market value of the underlying common stock based on our historical volatility. The Company uses the simplified method to estimate the expected term. The expected term of stock options granted to employees is equal to the contractual term of the option award. The Black-Scholes option-pricing model was developed for use in estimating the fair value of traded options, which have no vesting restrictions and are fully transferable. In addition, option valuation models require the input of highly subjective assumptions including the expected stock price volatility because the Company’s stock options and warrants have characteristics different from those of its traded stock, and because changes in the subjective input assumptions can materially affect the fair value estimate. There were no option grants in the three months ended March 31, 2025. The Company’s stock option compensation expense was $ 0.1 million and $ 0.2 million for the three months ended March 31, 2025 and 2024, respectively, and there was $ 1.3 million of total unrecognized compensation costs related to outstanding stock options at March 31, 2025 which will be recognized over 3.5 years. There were no options issued or exercised in the three months ended March 31, 2025. The number of stock options vested and unvested as of March 31, 2025 were 395,531 and 255,373 , respectively. Stock-based compensation expense is generally included in selling, general and administrative expenses in the consolidated statement of operations. Restricted Stock Units In November 2022, the Board approved a stock grant under the Company’s 2021 Equity Incentive Plan, consisting of (i) a one-time grant of 142,500 restricted stock units (“RSUs”) and (ii) a target number of 142,500 performance restricted stock units (“PRSUs”) to further incentivize and align the CEO’s interest with the Company. For the RSUs, 50% vested upon the grant date, 25% vested on February 1, 2024 and 25% vested on February 1, 2025. The number of shares issuable under the PSUs were determined based on the achievement of performance metrics specific to the Company that were measured at the end of fiscal year 2024. The fair value of both the RSUs and PSUs were based on the stock price of $13.05 per share on the date of grant. The PSUs were reviewed to determine estimated performance over the term and then a factor was applied ranging from 0% to 150% of the grant date fair value. As of December 31, 2024, based on the specific performance metrics set by the Company, the target number of shares underlying the PSUs was increased by 44,531 shares of common stock for a total of 187,031 shares granted under the PSU. There have been no further grants as of the three months ended March 31, 2025. A summary of activity of the RSUs for the three months ended March 31, 2025 is as follows: Schedule of RSU activity Shares Weighted Average Grant Date Fair Value Unvested at beginning of 2025 35,625 $ 13.05 Granted – – Vested ( 35,625 ) 2.59 Forfeited – – Unvested at end of 2025 – $ 0.00 Stock compensation expense related to restricted stock units was $ 35 thousand during the three months ended March 31, 2025. Stock compensation expense related to performance stock units was $ 0.2 million during the three months ended March 31, 2025. There are no further unrecognized stock compensation expenses remaining to be recognized at this time. 19 Restricted Stock Awards The Company issues restricted stock awards to the members of its board of directors as compensation for such members’ services. Such grants generally vest ratably over four quarters. The common stock related to these awards are issued to an escrow account on the date of grant and released to the grantee upon vesting. The fair value is determined based on the closing stock price of the Company’s common stock on the date granted and the related expense is recognized ratably over the vesting period. A summary of activity of the restricted stock awards for the three months ended March 31, 2025: Schedule of restricted stock awards Weighted- Nonvested Average Grant- Shares Date Fair Value Nonvested at December 31, 2024 – – Granted 121,359 $ 3.09 Vested ( 30,340 ) 2.04 Forfeited – – Nonvested at March 31, 2025 91,019 $ 3.09 Stock compensation expense related to restricted stock awards was $ 0.1 million for the three months ended March 31, 2025 and $ 6 thousand for the three months ended March 31, 2024. Fair values of restricted stock vested during each of the three months ended March 31, 2025 and 2024 were $ 0.1 million and $ 2 thousand, respectively. As of March 31, 2025, there were unvested shares of common stock representing $ 0.3 million of unrecognized restricted stock grant expense which will be recognized over 9 months. Warrants During the three months ended March 31, 2025, the Company had exercisable warrants to purchase up to 200,000 shares of the Company’s common stock at a price per share equal to $17.00 issued to a consultant for investor relations services to be provided over a five-year period starting in March 2023. The warrants are immediately exercisable but are subject to repurchase by the Company until the required service is provided. The fair value of such warrants was $8.05 per share or $ 1.6 million on the date of grant using the Black-Scholes option-pricing model. This model incorporated certain assumptions for inputs including a risk-free market interest rate of 3.86%, expected dividend yield of the underlying common stock of 0%, expected life of 2.5 years and expected volatility in the market value of the underlying common stock based on our historical volatility of 99.6%. The fair value of the warrant was recorded to prepaid expenses and other current assets to be recognized over the service period. During the three months ended March 31, 2025, $ 0.1 million was recorded as expense and at March 31, 2025, $1.0 million of cost has not been recognized and will be recognized over the next 3 years. These warrants are not cashless and expire on March 31, 2028. A summary of activity of warrants outstanding for the three months ended March 31, 2025 is as follows: Schedule of activity of warrants outstanding Number of Shares of Common Stock Underlying Warrants Weighted Average Exercise Price Outstanding at December 31, 2024 200,000 $ 17.00 Granted – – Expired – – Exercised – – Outstanding at March 31, 2025 200,000 $ 17.00 The warrant outstanding as of March 31, 2025 expires in March 2028. The intrinsic value of the shares of common stock underlying the warrants at March 31, 2025 was $ 0.00 . 20 13. REVENUES For each of the identified periods, revenues are categorized as follows (in thousands): Schedule of revenues Three Months Ended March 31, 2025 2024 Product sales $ 5,970 $ 13,570 Maintenance fees 67 27 Professional services 69 65 Shipping and handling 256 978 Discounts and allowances ( 38 ) ( 80 ) Total revenues $ 6,324 $ 14,561 The following table disaggregates gross revenue from our clients by significant geographic area for the three months ended March 31, 2025 and 2024: Schedule of disaggregates gross revenue For the Three Months Ended March 31, 2025 2024 United States $ 4,798 $ 13,132 Serbia 764 1,081 Romania 391 95 Croatia 298 94 Montenegro 73 102 Bosnia – 57 Total revenue $ 6,324 $ 14,561 During the three months ended March 31, 2025 and 2024, 14 % and 58 % of revenues were derived from federal customers, while 33 % and 26 % were from state and local governments, respectively. In addition, 25 % of revenues in the three months ended March 31, 2025 were sales made outside of the United States compared to 11 % in the prior year. At March 31, 2025 and 2024, deferred revenue was $ 1.9 million and $ 1.5 million, respectively. These amounts consisted mainly of customer deposits in the amount of $ 0.7 million and $ 0.9 million for March 31, 2025 and 2024, respectively, and prepaid multi-year maintenance plans for previously sold products which account for $ 1.2 million and $ 0.6 million for March 31, 2025 and 2024, respectively, and pertain to services to be provided through 2035. Revenue recognized during the three months ended March 31, 2025 and 2024 which pertained to revenue deferred in prior years was $ 48 thousand and $ 27 thousand respectively. The balance of contract assets is driven by the difference in timing of when revenue is recognized from performance obligations satisfied in the current reporting period and when amounts are invoiced to the customer. The balance of contract liabilities is driven by the difference in timing between when cash is received pursuant to a contract and when the Company’s performance obligations under the contract are satisfied. The following table provides the activity for the contract liabilities recognized (in thousands): Schedule of contract liabilities For the Three Months Ended March 31, 2025 2024 Beginning Balance $ 1,647 $ 1,230 Additions 324 111 Recognized in revenue ( 72 ) ( 250 ) Ending Balance $ 1,899 $ 1,091 21 14. SEGMENT REPORTING The Company has a single reportable segment focused around providing clean-technology innovation focused on providing high-quality, renewably energized products. The Company’s chief operating decision-maker (the “CODM”), who is the Chief Executive Officer, assesses performance for the reportable segment and decides how to allocate resources using net income (loss) as the primary measure of profitability. The CODM is not regularly provided with specific segment expenses, but focuses on revenue, gross profit, and net income. Expense information, including cost of sales, can be easily computed from the provided information. These segment (and consolidated) measures of profitability are shown in the statements of operations. The measure of segment assets are reported on the balance sheets as total assets. 15. RISKS AND UNCERTAINTIES The continuing impacts of rising interest rates, inflation, changes in foreign currency exchange rates and geopolitical developments, such as the imposition of tariffs and shifts in international alliances, have resulted, and may continue to result, in a global slowdown of economic activity, which may decrease demand for a broad variety of goods and services, including those provided by the Company’s clients and as a result, the Company, while also disrupting supply channels, sales channels and advertising and marketing activities for an unknown period of time. Additionally, recent changes to U.S. policy implemented by the U.S. Congress, and the Executive Branch and the responses of other nations to such actions have impacted and may in the future impact, among other things, the U.S. and global economy, international alliances and trade relations, unemployment, immigration, healthcare, taxation, the U.S. regulatory environment, inflation and other areas. As a result of the current uncertainty regarding economic activity, the Company is unable to predict the size and duration of the impact of its revenue and its results of operations, if any, of actions taken to date and those that may occur in the future. The extent of the potential impact of these macroeconomic factors on the Company’s operational and financial performance will depend on a variety of factors, including the extent of geopolitical disruption and its impact on the Company’s clients, partners, industry and employees, all of which are uncertain at this time and cannot be accurately predicted. The Company continues to monitor the effects of these macroeconomic factors and intends to take steps deemed appropriate to limit the impact on its business. There can be no assurance that precautionary measures, whether adopted by the Company or imposed by others, will be effective, and such measures could negatively affect its sales, marketing, and client service efforts, delay and lengthen its sales cycles, decrease its employees’, clients’, or partners’ productivity, or create operational or other challenges, any of which could harm its business and results of operations. 16. SUBSEQUENT EVENTS Management has evaluated events that have occurred subsequent to the date of these condensed consolidated financial statements and has determined that no such reportable subsequent events exist through date of filing. Based upon this review, the Company did not identify any subsequent events that would have required adjustment or disclosure in the financial statements. 22 Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations References in this Report to “we,” “us,” “our,” the “Company” or “Beam” means Beam Global, a Nevada corporation, and its subsidiaries. SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This report contains forward-looking statements that are based on current expectations, estimates, forecasts, and projections about us, the industry in which we operate and other matters, as well as management's beliefs and assumptions and other statements regarding matters that are not historical facts. These statements include, in particular, statements about our plans, strategies and prospects. For example, when we use words such as “projects,” “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “should,” “would,” “could,” “will,” “opportunity,” “potential” or “may,” and variations of such words or other words that convey uncertainty of future events or outcomes, we are making 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”). These forward-looking statements are subject to numerous assumptions, risks and uncertainties that may cause the Company’s actual results to be materially different from any future results expressed or implied by the Company in those statements. The most important factors that could prevent the Company from achieving its stated goals include, but are not limited to, the following: (a) volatility or decline of the Company’s stock price, or absence of stock price appreciation; (b) fluctuation in quarterly results; (c) failure of the Company to earn revenues or profits; (d) inadequate capital to continue or expand its business, and the inability to raise additional capital or financing to implement its business plans; (e) reductions in demand for the Company’s products and services, whether because of competition, general industry conditions, loss of tax incentives for solar power, technological obsolescence, or other reasons; (f) litigation with or legal claims and allegations by outside parties; (g) insufficient revenues to cover operating costs, resulting in persistent losses; (h) (i) rapid and significant changes to costs of raw materials from government tariffs or other market factors; significant currency fluctuation or foreign regulations that could impact our business; (j) the preceding and other factors discussed in Part I, Item 1A, “Risk Factors,” and other reports we may file with the Securities and Exchange Commission from time to time; and (k) the factors set forth in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” We caution you that the foregoing list may not contain all of the forward-looking statements made in this Form 10-Q. You should not rely upon forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this Form 10-Q primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, results of operations and prospects. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties and other factors described in the section titled "Risk Factors" and elsewhere in this Form 10-Q. 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 for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Form 10-Q. We cannot assure you that the results, events and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements. 23 The forward-looking statements made in this Form 10-Q relate only to events as of the date on which the statements are made. We undertake no obligation to update any forward-looking statements to reflect events or circumstances or to reflect new information or the occurrence of unanticipated events, except as required by law. Overview Beam is a clean-technology innovation company headquartered in San Diego, California with factories in the U.S. in San Diego, California and Broadview, Illinois and in Europe in Belgrade and Kraljevo, Serbia. We develop, design, engineer, manufacture, and sell high-quality, renewably energized infrastructure products for electric vehicle (“EV”) charging, infrastructure for Smart Cities (the interconnected physical and digital elements within a city that utilize technology to enhance efficiency, sustainability, and quality of life for residents), energy security and disaster preparedness and highly energy-dense battery solutions in safe, compact and unique form-factors. Additionally, we manufacture steel structures with electronic integration such as street lighting, cell towers and energy infrastructure products as well as power electronics including invertors, charge controllers, power supplies and LED lighting. Beam’s energy storage products provide high energy density in safe, compact and bespoke form-factors, which we believe are ideal for the rapidly growing mobile and stationary equipment product market which often requires electrical energy without being connected to the electrical grid. Our EV charging infrastructure products are powered by locally generated renewable energy and enable vital and highly valuable services in locations where it is either too expensive, disruptive, or impossible to connect to a utility grid, or where the requirements for electrical power are so important that grid failures, like blackouts, are intolerable. We do not compete with EV charging companies; rather, we assist these companies by offering infrastructure solutions that replace the time-consuming and expensive process of construction and electrical work which are usually required to install traditional grid-tied EV chargers. We also do not compete with utility companies. Our products enable utilities and others to deliver reliable and low-cost electricity to EV chargers and, in the case of a grid failure, to first responders and others, through our integrated emergency power panels. Our charging products are rapidly deployed without the need for construction or electrical work. We compete with the highly fragmented and disintegrated ecosystem of general contractors, electrical contractors, consultants, engineers, permitting specialists and others, who are required to perform a traditional grid-tied EV charger installation construction and electrical project. Our clean-technology products are designed to replace a complicated, expensive, time-consuming and risk prone process with an easy, robust and reliable product at a low cost of total ownership. We provide energy storage technologies that we believe make commodity battery cells safer, longer lasting and more energy efficient. Our battery management systems, and associated packaging, make batteries safer and usable in a variety of mobility, energy-security, and stationary applications. Our street lighting and other street furniture products are mass produced and sold in 18 nations globally. We are increasingly adding power electronics, energy storage, computing, sensing and reporting to our street furniture products as we evolve them to provided greater levels of Smart Cities services. Beam’s renewably energized infrastructure products and proprietary technology solutions target markets that are experiencing significant growth with annual global spending in billions of dollars. · EV charging infrastructure; · Smart Cities infrastructure; · energy storage solutions; · energy security and disaster preparedness; · transportation infrastructure products; and · Power electronics and telecommunications equipment 24 The Company focuses on creating high-quality products that are powered primarily by renewable energy, rapidly deployable, have diverse use cases and are attractively designed. We believe that there is a clear need for rapidly deployable and highly scalable EV charging and infrastructure for Smart Cities, and that our EV ARC™, BeamBike™, BeamPatrol™, BeamSkoot™, BeamSpot™ and other street furniture products fulfill that requirement. We are agnostic to the EV charging service equipment as we do not sell EV charging, rather we sell products which enable it. Our EV charging infrastructure products replace the traditional infrastructure required to support EV chargers, not the chargers themselves. We have over thirty years of experience deploying street-lighting, transportation, energy and telecommunications infrastructure products as a result of our 2023 acquisition of Amiga in Serbia. We have relationships with existing customers to whom we are now able to sell our renewably energized EV charging infrastructure products as well as our Smart Cities products. During the second half of 2024 we significantly expanded our product portfolio with the addition of rapidly deployed and highly scalable charging infrastructure products for electric bicycles, electric scooters, and electric motorcycles. We also introduced de-salination as a capability to enhance the lifesaving aspects of our disaster preparedness products. Powered by 100% renewable energy, our BeamWell™ self-sufficient water treatment system converts seawater into vital freshwater. It is equipped with four eMopeds for efficient and rapid transport in environments such as war zones, disaster or crisis zones, where people need drinking water, electricity and mobility most. Our ability to make commodity battery cells safer, longer lived and more energy efficient in bespoke enclosures is, we believe, a significant differentiator as we move to an increasingly electrified and untethered world. All of our renewably energized products generate their own electricity and are stored in our integrated batteries. Our ability to develop energy-dense, highly safe batteries in unique shapes and sizes allows us to serve customers with specialized needs, including manufacturers of drones, robotic and medical devices, submersibles, refrigerated transport units, and a wide range of other applications. We are also able to enhance our patented products which provide electric vehicle charging, energy security disaster preparedness through the creation of bespoke energy-dense and safe battery products which are unique to our in-house portfolio. We believe our chief differentiators are: · Our patented, renewably energized products dramatically reduce the cost, time and complexity of the installation and operation of EV charging infrastructure when compared to traditional, utility grid tied alternatives; · Our proprietary and patented energy storage solutions; · Our first-to-market advantage with EV charging infrastructure products which are renewably energized, rapidly deployed and require no construction or electrical work on site; · Our products’ capability to operate during grid outages and to provide a source of EV charging and emergency power rather than becoming inoperable during times of emergency or other grid interruptions; · Our ability to add electrical capacity to provide for the significant increase demand brought by electrified transportation, data centers, AI and the electrification of industry, without having to go through expensive, time-consuming and risky utility grid expansion (adding power stations, transmission lines and distribution infrastructure like substations); · Our ability to create new and patentable products which are marketable and consist of a complex integration of our proprietary technology and parts with other commonly available engineered components, which create a further barrier to entry for our competition; · Our ability to create products which provide valuable solutions to nascent industries with very large market opportunities globally; · Our geographic footprint in North America and Europe, and existing customer base and contracts. 25 Overall Business Outlook Our revenues for the first three months of 2025 were $6.3 million, a 57% decrease from $14.6 million for the first three months in 2024. We believe that the decrease in revenue is a result of uncertainty in the U.S. government’s zero emission vehicle strategy related to the presidential election. These matters have particularly impacted our larger federal customers and we do not believe that they signify any fundamental reduction in demand for our products. Our pipeline of prospective customer orders has increased during the same period, although we cannot be sure of when, or if, those prospective orders will turn into actual sales. As we have continued investment in our sales resources, in September 2024 we hired a new Vice President of Sales in the U.S. and a new Director of Channel Partnerships in Europe to drive growth in commercial and government sectors. Revenues were diverse across federal, state and local governments, as well as enterprise and education sector customers. International customers comprised 25% of all revenue as of March 31, 2025 verses 11% for the three months ended March 31, 2024. Revenues derived from non-government commercial entities increased by 41% for the three months from 2024 to 2025 and were 53% of total revenues in 2025. For the three months ended, March 31, 2025, the Company’s sales to federal, state and local governments represented 47% of revenues verses 84% of the same period revenues in 2024. We continue to invest in sales employees, marketing resources, diversifying our product portfolio with new product offerings and expanding our geographic footprint to reduce our reliance on single large orders of our EV ARC™ product from federal agencies, although we believe that that opportunity still exists. The receipt of orders may continue to be uneven due to the timing of customer approvals or budget cycles, however we believe that as EV adoption increases and our new and existing products are brought to larger international audiences, our business will be less impacted by specific variations in order timing. We have initiated a program of resellers, agents and distributors, as a sales force multiplication strategy without adding to our operating costs, as they are only compensated when they sell products. This means that we can take our greatly expanded product portfolio and sell it into greatly expanded geographic opportunities, without having to invest significantly. We now have resellers and agents in the United States, Spain, Portugal, Italy, Caribbean, Central America, the Balkans, the Middle East, Africa and Australia. The Company believes there continues to be a high level of support for funding EV charging infrastructure from both commercial and government entities, including a number of federal grants available under the Inflation Reduction Act. In addition, certain of our commercial customers may benefit from the Federal Solar Investment Tax Credit and accelerated depreciation as allowed under Section 179 of the IRS code which, we believe, provides a competitive advantage for our products over traditionally installed EV charging infrastructure which is not eligible for these incentives. Given these available incentives, we have invested in a federal lobbyist, a federal business development resource and a government relations employee, who have helped to identify opportunities and increase awareness of our product and outreach with federal agencies. We have in place a Multiple Award Schedule Contract with the General Services Administration (GSA) that helps streamline purchases from Federal agencies and state and local governments. In addition, the GSA awarded Beam Global a federal blanket purchase agreement in April 2022 which provides federal agencies a streamlined procurement process for procuring EV ARC™ systems. In the three months ended March 31, 2025, we recorded revenues of $3.0 million for federal customers, compared to $12.2 million for the same period in 2024. We expect to see uneven orders from quarter to quarter, especially with our federal customers, but over time we expect our revenues to grow. Our commercial, non-government, revenues increased as a percentage of our revenues from 16% to 53% from the first three months of 2024 to the first three months of 2025. Our geographic expansion into Europe and our additional business development activities in the Middle East and Africa are, we believe, also providing opportunities for growth which are not dependent on, or impacted by, shifts in US government zero emission vehicle policies. The new products we have brought to market offer values which are also not dependent upon US federal government investment. We expect the electric vehicle market to continue to experience significant growth globally over the next decade, which will in turn increase demand for additional EV charging infrastructure. We believe we are positioned to benefit significantly from this growth. Additionally, by achieving compliance with the Build America, Buy America Act, which ensures that our products are manufactured in the United States using a sufficient amount of domestically sourced materials, we will meet federal domestic production requirements. Furthermore, obtaining the CE mark (Conformité Européenne) a mandatory certification indicating that a product complies with European Union (EU) health, safety, and environmental protection standards, on EV ARC™, BeamBike™, BeamWell™ and BeamPatrol™ products, will allow our products to be freely traded within the European Economic Area (EEA). We believe these achievements will enhance our credibility, strengthen consumer trust, and increase demand for our products, particularly among federal, state, and local government agencies. 26 As a result of the acquisition of All Cell we now have the ability to value engineer bespoke battery solutions for our products. Beam All-Cell ™ batteries are ideally suited for applications where energy density, safety and bespoke enclosures require high power in small spaces. Drones, submersibles, recreational products and a host of micro mobility and electric vehicle products are already benefiting from our Beam All-Cell ™ highly differentiated products. With the continued growth of untethered electrification, we believe there is an opportunity for increased demand in these markets and others. In October 2023, the Company acquired Amiga (now renamed Beam Europe), an established manufacturer of specialized steel structures and equipment, producing streetlights, communications and energy infrastructure whose manufacturing, engineering and sales teams service municipalities, states and commercial customers in 18 nations. The addition of Amiga has expanded Beam’s presence into the European, Middle Eastern and African markets and increased our production, engineering, sales and product development expertise. The EU has mandated a transition to zero emission vehicles by 2035 and they are heavily focused on green and sustainable energy. An increase in electric vehicles adoptions will increase the demand for charging infrastructure. We believe that our sustainably energized, rapidly deployed and highly scalable products can play a major role in the provision of EV charging infrastructure for all types of electric vehicles, bikes, scooters and motorcycles in Europe, the Middle East and Africa. On August 30, 2024, Beam acquired Telcom d.o.o. Beograd (“Telcom”), a business located in Serbia and engaged in the manufacturing of power electronics and telecommunications equipment. Telcom engineers and manufacturers specialized in power electronics including invertors, charge controllers, power supplies and LED lighting. Telcom has electrical engineering, product development and manufacturing capabilities which Beam believes are ideally suited to improve the Company’s current and future products for the global market while reducing our costs and improving our margins. Telcom has a well-respected and highly talented team of electrical engineers, focused on power electronics and the integration of renewables and energy storage. Existing Telcom customers include the region’s largest telecommunications company as well as other corporate entities which we believe provide further opportunities for cross selling the other products in our portfolio. In November 2024, we deployed our first sponsorship funded network of EV ARC™ systems at Belgrade International Airport in Serbia. Beam Global retains ownership of the deployed EV ARC™ units and receives recurring payments from Globos Osiguranje, the region’s fastest growing insurance company. In return, Globos Osiguranje benefits from prominent brand visibility, with their branding displayed on EV ARC™ systems installed in high-traffic parking spaces closest to the airport terminal. These branded systems are strategically positioned to be visible to travelers as they arrive at and depart from the airport. We also entered into an agreement with Vinci Airports, the world’s leading private airport operator with over 70 airports under management internationally, which does not require us to pay rent because of the amenity value that is delivered to the airport through the provision of a free driving on sunshine experience for their visitors and guests. We believe that we may be able to repeat this model in other Vinci airports around the world. We also believe that now that we have successfully proved that this business model works, we can further expand it into different types of environments where there are sufficient densities of people to make the advertising worthwhile. In December 2024, we partnered with Benzina Zero, an innovative provider of electric mopeds and scooters, electric bicycles and micro-mobility solutions. Benzina Zero (which is Italian for zero gasoline) is Australia’s leading e-mobility brand offering a range of e-scooters, e-mopeds, e-bikes and e-motorcycles. Benzina Zero work with global fleet businesses across a number of industries including food delivery, postal delivery to eco-tourism, and boast a comprehensive dealer network Australia-wide. Benzina Zero have appointed distributors in Australia, Italy, United Kingdom, Ireland, Slovenia and Croatia and are also active in New Zealand, Hong Kong, Singapore, Philippines and Finland. We will bundle Benzina Zero e-mobility solutions with products BeamBike™, BeamWell™ and BeamSkoot™, and will introduce Benzina’s highly ruggedized products to Beam’s existing customers and prospects globally. This is another approach to increase our sales channels without adding overhead costs. Our energy security business is also connected with the deployment of our EV charging infrastructure products and serves as an additional benefit to the value proposition of our charging products which, along with their integrated emergency power panels, can continue to operate, charge EVs, and deliver emergency power during utility grid failures. Our state-of-the-art storage batteries installed on our EV charging systems are immune to grid failures and provide another benefit for customers such as municipalities, counties, states, the federal government, hospitals, fire departments, large private enterprises with substantial facilities, and vehicle fleet operators. Drones, submersibles, recreational products and a host of micro mobility and electric vehicle products are already benefiting from our Beam All-Cell ™ highly differentiated products. With the continued growth of untethered electrification, we believe there is an opportunity for increased demand in these markets and others. 27 We are in development on our newest patented products which include BeamSpot™, UAV ARC™ and others, which we expect will continue to expand our product offerings leveraging the same proprietary technology as our current products and allow us to expand into new markets. Beam Europe (formerly Amiga) is one of Europe’s largest manufacturers of streetlights and has a team of qualified structural, electrical and civil engineers who are experts in the field of development and deployment of street lighting. They are working with our engineers in San Diego and Broadview to continually improve the engineering and development of our new BeamSpot™ product. We believe that BeamSpot™ may become our largest selling product. BeamSpot™ is currently in the process of being installed and we received our first order for that product within two months of it being launched. In addition, EV ARC™, BeamBike™, BeamWell™ and BeamPatrol™ products have fulfilled the requirements to receive the CE mark (Conformité Européenne), a mandatory symbol indicating that a product meets European Union (EU) health, safety and environmental protection requirements, allowing it to be freely traded within the European Economic Area (EEA). The Company reported a positive gross profit of $0.5 million for the three months ended March 31, 2025, compared to $1.5 million gross profit in 2024. Our gross margin as a percentage of sales was 7.9% for the three months ended March 31, 2025. Additionally, for the three months ended March 31, 2025, 88.4% of ARC sales reflected our price increase implemented in 2023. Our gross profits included a negative impact of $1.0 million for non-cash depreciation and intangible amortization. Our gross margin net of non-cash items was 20.6%. We expect to see our costs of goods sold continue to decrease over time. We have continued to implement lean manufacturing process improvements and making engineering changes to our products which we expect to result in cost reductions. Many of the components that we integrate into our products are manufactured by others. We continue to identify components and sub-assemblies that may be more cost effective to produce in our Serbian facilities, which we believe may further reduce our costs, increase our gross margins, and significantly increase the potential output from our US-based factories. We expect that the receipt of orders may be inconsistent quarter over quarter, however, we expect that in the long term, our revenues will grow as we expand our product offerings and geographic reach and because we expect to see a significant increase in the global demand for electric vehicle charging infrastructure. As such we do not anticipate significant pricing pressure on our products. The increase in demand for electric vehicle charging infrastructure and, we believe, over the long term, our revenues, combined with the cost-cutting measures described above, lead us to believe that we will continue to see improvement in our gross margins in the future. Beam Europe has the capability to perform several activities which we outsource in the US. We believe that in combination with a generally less expensive operating environment in Serbia, we will be able to produce our products in Europe less expensively than in the U.S., even as we continue to reduce our costs in the U.S. Critical Accounting Estimates The financial statements and related disclosures were prepared in accordance with U.S. generally accepted accounting principles which require us to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates in our condensed consolidated financial statements include, but are not limited to, accounting for acquisitions and business combinations; initial valuation and subsequent impairment testing of goodwill, other intangible assets and long-lived assets; leases; fair value of financial instruments, income taxes; inventory; and commitments and contingencies. We base our estimates and assumptions on historical experience and on various other factors that we believe to be reasonable under the circumstances, and we continually evaluate our assumptions and modify as needed. To the extent there are material differences between our estimates and the actual results, our future results of operations will be affected. There have been no changes since year end, refer back to the Company’s Form 10-K for December 31, 2024. Results of Operations Comparison of Results of Operations for the Three Months Ended March 31, 2025 and 2024 Revenues. For the three months ended March 31, 2025, our revenues decreased 57% to $6.3 million compared to $14.6 million for 2024. During the three months ended March 31, 2025, $1.0 million, or 14% of product sales, were to Federal customers. State and Local governments customers accounted for $2.1 million, or 33% of revenues. We continue to invest in sales, marketing and government relation employees, resources and programs to raise awareness of the benefits and value of our products. The receipt of orders may continue to be uneven due to the timing of customer approvals or budget cycles, however we believe that as EV adoption increases in concert with increased availability of infrastructure funding, our business will be less impacted by specific variations in order timing. 28 Gross Profit. The Company reported a positive gross profit of $0.5 million, a 7.9% gross margin for the three months ended March 31, 2025, compared to a gross profit of $1.5 million, a 10.2% gross margin in 2024. Additionally, 24.1% of ARC sales in 2024 reflected the price increase implemented in 2023 and 88.4% in the first three months ending March 31, 2025. The gross profit includes a non-cash negative impact of $0.2 million for amortization of intangible assets resulting from the All Cell acquisition. Without this non-cash expense, gross profit for 2025 would be $0.7 million, a 10.9% gross margin. Our engineering team has continued to implement design changes during 2024 which reduced the bill of materials for the EV ARC TM , improving the product margins throughout 2024. We expect the Company’s revenue to grow in the future and our fixed overhead absorption to continue to improve. Operating Expenses and Impairment of Goodwill. Total operating expenses were $16.0 million for the three months ended March 31, 2025, compared to $4.5 million in 2024. The 2025 operating expenses included a $10.8 million goodwill impairment and a $0.8 million increase due to European acquisitions. Based on the results of the Company’s goodwill impairment procedures, the Company recorded goodwill impairment for the single reporting unit during the three months ended March 31, 2025. The Company believes the goodwill impairment reported during the three months ended March 31, 2025 is not a negative indicator of historic or current operating results and not a negative indicator of future performance as the Company has taken significant steps to diversify its geographical reach and product offerings while focusing strategic growth. The Company believes that the resulting non-cash charge has no impact on the Company’s compliance with its cash flows or available liquidity. Liquidity and Capital Resources At March 31, 2025, we had cash of $2.5 million, compared to $5.0 million at March 31, 2024. We have historically met our cash needs through a combination of debt and equity financing and most recently through gross profit contribution. Our cash requirements are generally for operating activities and acquisitions. Management believes the Company’s present cash flows will enable it to meet its obligations for twelve months from the date of these financial statements. Management will continue to assess its operational needs and seek additional financing as needed to fund its operations. Our cash flows from operating, investing and financing activities, as reflected in the statements of cash flows, are summarized in the table below: March 31, 2025 2024 Cash provided by (used in): Net cash used in operating activities $ (1,760 ) $ (3,026 ) Net cash used in investing activities $ (70 ) $ (2,817 ) Net cash provided (used) by financing activities $ (15 ) $ 277 For the three months ended March 31, 2025, our cash used in operating activities was $1.8 million compared to $3.0 million for the three months ended March 31, 2024. Net loss of $15.5 million for the three months ended March 31, 2025 was decreased by $12.5 million of non-cash expense items that included $10.8 million for Goodwill impairment, $1.0 million for depreciation and amortization, $0.5 million for stock-based compensation and $0.2 million in provisions for credit losses. Cash used in operations also included a $0.7 million decrease in accounts payable, $0.7 million decrease in accounts receivable, $0.6 million decrease in inventory and $0.1 million decrease in accrued expenses offset by $0.2 million increase in accrued expenses related to short term taxes payable, $0.2 million increase in other long term liabilities and $0.2 million increase in deferred revenue. For the three months ended March 31, 2024, our cash used in operating activities was $3.0 million compared to $0.6 million for the three months ended March 31, 2023. Net loss of $3.0 million for the three months ended March 31, 2024 was adjusted by $1.1 million of non-cash expense items that included depreciation and amortization of $0.9 million, employee stock-based compensation expense of $0.6 million, offset by decreases of $0.3 million provision on credit losses and $0.1 million for a change in fair value of contingent consideration liabilities. Further, cash used in operations included a $3.9 million increase in accounts receivable due to the increase in revenues and the timing of customer payments. Cash generated from operations included a $1.0 million increase in accounts payable primarily for inventory, $1.1 million increase in accrued expenses, $0.4 million decrease in inventory, $0.3 million increase in deferred revenue and $0.2 million decrease in prepaid expenses and other current assets. Cash used in investing activities in the three months ended March 31, 2025 and March 31, 2024 was $0.1 million related to the purchases of equipment in both years. The three months ended March 31, 2024, included a $2.7 million reduction of deferred consideration for a cash payment for the Amiga acquisition. 29 For the three months ended March 31, 2025, cash used by our financing activities was $15 thousand related to repayments of note payables related to auto leases compared to $25 thousand borrowings in the prior year. Additionally, for the three months ended March 31, 2024, cash generated by our financing activities included $0.3 million for the exercise of warrants net of offering expenses. Current assets decreased to $23.6 million at March 31, 2025 from $27.1 million at December 31, 2024, primarily due to a $2.1 million decrease in cash, $1.0 million decrease in accounts receivable, and $0.4 million decrease in Inventory. Current liabilities decreased $0.4 million at March 31, 2025 compared to December 31, 2024, primarily due to a $0.6 million decrease in accounts payable offset by $0.2 million increase in sales tax payable. As a result, our working capital decreased to $10.8 million at March 31, 2025 compared to $13.8 million at December 31, 2024. The Company has been focused on marketing and sales efforts to increase our revenues, and we believe those efforts have led to an increase in revenues by 144% from 2021 to 2022 and 206% from 2022 to 2023. Even though there was a decrease in revenues by 27% from 2023 to 2024, we believe our marketing and sales efforts have been impactful. The Company has improved its gross profit in 2024 and will continue to in 2025, and it is expected to improve in the future as a result of a price increases implemented late 2023 being almost fully recognized in 2025 and benefits from cost reductions from several design changes. As revenues increase, we expect to continue to see our fixed overhead costs spread over more units, which will reduce the cost per unit further. The Company continued to see material cost reductions as synergies are recognized, especially with steel and battery cells, and we expect this trend to continue. This combined with engineering and manufacturing improvements should result in increasing gross profit margin on the EV ARC™ in the future. The Company may be required to raise capital to fund its operations until it achieves positive cash flow, which is predicated on increasing sales volumes and the continuation of production cost reduction measures. The Company could pursue other equity or debt financing. The proceeds from these offerings are expected to provide working capital to fund business operations and the development of new products. Management cannot currently predict when or if it will achieve positive cash flow. There is no guarantee that profitable operations will be achieved, or that additional capital or debt financing will be available on a timely basis, on favorable terms, or at all, and such funding, if raised, may not be sufficient to meet our obligations or enable us to continue to implement our long-term business strategy. In addition, obtaining additional funding or entering into other strategic transactions could result in significant dilution to our stockholders. The proceeds from these offerings are expected to provide working capital to fund business operations and the development of new products. Management cannot currently predict when or if it will achieve positive cash flow. On March 22, 2023, the Company entered into that certain Supply Chain Line of Credit with OCI Limited (“OCI”), whereby OCI may provide a supply chain line of credit in the amount of up to $100 million based on the amounts of approved accounts receivable of the Company (the “Credit Facility”). In order to request a drawdown on the Credit Facility, the Company is required to submit a transaction request to OCI which sets forth the terms of the applicable account receivables, including but not limited to the name of the party responsible for the applicable account receivables (the “Obligor”), the terms of repayment and the amount of such receivables. The Company has no obligation to submit a drawdown request and OCI is not obligated to accept any drawdown request from the Company. In the event OCI accepts a drawdown request of the Company and upon satisfaction of certain conditions required by OCI to issue the drawdown, OCI will disburse funds to the Company for such drawdown in an amount equal to the full value of the applicable account receivables assigned to OCI minus any transaction expenses incurred by OCI and the full amount of interest to be incurred for such receivables over the term of the drawdown. The Company will pay interest on any drawdown at the Secured Overnight Financing Rate +300 basis points. Upon the disbursement of funds to the Company for a drawdown, the Company will assign all rights to such account receivables of the Obligor to OCI. The Company will act as collection agent on any account receivable assigned to OCI and agrees to establish a designated bank account for the purpose of collecting payment on any applicable account receivable that are assigned to OCI. In the event (i) the Company is in material breach of the Credit Facility, (ii) the Company or the Obligor is insolvent or is subject to reorganization or liquidation, or (iii) any dispute related to an agreement with an Obligor or non-payment by an Obligor, OCI has the right to exercise any contractual rights it may have against Obligor, increase the interest rate to the agreed upon default interest rate, and demand immediate repayment by the Company for the outstanding amounts owed under such account receivables. The Company has also agreed to indemnify OCI for any losses incurred by OCI in connection with the Credit Facility. Either party may terminate the Credit Facility at any time by providing fifteen (15) days prior written notice to the other party. To date, Beam Global has not drawn on this line of credit. 30 On April 11, 2025, the Company entered into an At Market Issuance Sales Agreement with B. Riley Securities, Inc., pursuant to which the Company has the right, but not the obligation, to sell up to $8 million in shares of its common stock, subject to certain terms and conditions. Management believes that evolution in the operations of the Company may allow it to execute its strategic plan and enable it to experience profitable growth in the future. This evolution is anticipated to include the following continual steps: addition of sales personnel and independent sales channels, reductions in direct costs due to engineering and manufacturing improvements, continued management of overhead costs, increased overhead absorption resulting from volume growth, process improvements and vendor negotiations leading to cost reductions, increased public awareness of the Company and its products, and the continued acceleration of average sales cycle opportunities. Management believes that these steps, if successful, may enable the Company to generate sufficient revenue to continue operations. There is no assurance, however, as to if or when the Company will be able to achieve those operating objectives. Off-Balance Sheet Arrangements We do not have any off-balance sheet arrangements that have, or are reasonably likely to have, a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources, that are material to investors. Item 3. Quantitative and Qualitative Disclosures About Market Risk Not Applicable Item 4. Controls and Procedures Evaluation of Disclosure Controls and Procedures Our management is responsible for establishing and maintaining disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports under the Securities Exchange Act of 1934 (the “Exchange Act”) is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission (the “SEC”), and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure based closely on the definition of “disclosure controls and procedures” in Rule 15d-15(e) under the Exchange Act. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Our Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of the design and operation of our disclosure controls and procedures. Based upon the foregoing, our Chief Executive Officer and Chief Financial Officer concluded that, as of March 31, 2025, the disclosure controls and procedures of our Company were not effective to ensure that the information required to be disclosed in our Exchange Act reports was recorded, processed, summarized and reported on a timely basis due to material weakness in internal controls as identified below. As reported in our Annual Report on Form 10-K for the year ended December 31, 2024, management identified the following material weaknesses: · Ineffective design and implementation over Information Technology General Controls (“ITGCs”) · The Company does not have sufficient controls in place to ensure that all inventory is appropriately tracked and recorded on a timely basis, given the lack of an automated tracking system and the manual nature of its current processes and controls surrounding inventory · The Company did not maintain adequate controls relating to documentation of the review and approval of reconciliations and other schedules prepared internally to be included or disclosed in the financial statements. Many of our reports and reconciliations are performed in Excel spreadsheets, and we did not adequately validate the segregation of duties between the preparer and the approver with a signature and time stamp · Appropriate segregation of duties that would adequately restrict user access and ensure adequate review of transactions. Because we are a small company, many employees have multiple job responsibilities, and during the implementation in Q4, access was allowed for employees to access necessary tasks. As we move forward into 2025, we will assign access to ensure the proper segregation of duties. Additionally, we need to ensure the employees are adequately trained and able to resolve issues in a timely way. The Company needs to establish appropriate procedures for change management to ensure changes to the system are formally approved, properly restricted to appropriate personnel, and adequately tested · The Company did not maintain sufficient controls related to Beam Europe · The Company did not complete a Sarbanes-Oxley (SOX) Section 404A assessment 31 Changes in Internal Control Over Financial Reporting The Company is continuing to actively work to remediate the material weaknesses described above, including the need for additional remediation steps and implementing additional measures to remediate the underlying causes that give rise to the material weaknesses. During the three months ended March 31, 2025, the Company has taken various actions to strengthen our internal control over financial reporting, including: · Continue to review access in NetSuite ERP to ensure the proper segregation of duties and additional training courses to ensure the employees are trained and able to resolve issues timely. · Managed processes related to ordering, counting, warehousing, valuing and transacting our inventory in NetSuite ERP. · Increasing and monitoring the adequacy of staffing levels and expertise with the requisite technical knowledge and skills to support continued enhancement on the controls and procedures surrounding documentation of review and formalization of reconciliations, accounting policies and controls. · Continue to manage a segregation of duties between the preparer and the approver of reconciliation and supporting schedules which included hiring additional staff. The material weaknesses will be considered remediated when management concludes that, through testing, the applicable remedial controls are designed, implemented and operating effectively. As management continues to evaluate and improve disclosure controls and procedures and internal control over financial reporting, the Company may decide to take additional measures to address control deficiencies or determine to modify, or in appropriate circumstances not to complete, certain of the remediation measures identified. 32 PART II. OTHER INFORMATION Item 1. Legal Proceedings The Company may from time to time become party to actions, claims, suits, investigations or proceedings arising from the ordinary course of our business, including actions with respect to intellectual property claims, breach of contract claims, labor and employment claims and other matters. Any litigation could divert management time and attention from the Company, could involve significant amounts of legal fees and other fees and expenses, or could result in an adverse outcome having a material adverse effect on our financial condition, cash flows or results of operations. Actions, claims, suits, investigations and proceedings are inherently uncertain, and their results cannot be predicted with certainty. We are not currently involved in any legal proceedings that we believe are, individually or in the aggregate, material to our business, results of operations or financial condition. However, regardless of the outcome, litigation can have an adverse impact on us because of associated cost and diversion of management time. Item 1A. Risk Factors In addition to the other information set forth in this Form 10-Q, you should carefully consider the factors discussed in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2024, which could materially affect our business, financial condition, liquidity or future results. The risks described in our Annual Report on Form 10-K are not the only risks facing our company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may materially adversely affect our business, financial condition, liquidity or future results. Item 2. Unregistered Sales of Equity Securities and Use of Proceeds None. Item 3. Defaults Upon Senior Securities None. Item 4. Mine Safety Disclosures Not applicable. Item 5. Other Information During the quarter ended March 31, 2025, no director or officer adopted or terminated any Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement, as each term is defined in Item 408(a) of Regulation S-K. 33 Item 6. Exhibits Incorporated by Reference Exhibit Number Exhibit Description Form File No. Exhibit Filing Date Filed Herewith 3.1 Articles of Incorporation SB-2 333-147104 3.1 11/2/2007 3.2 Amendment to Articles of Incorporation dated December 23, 2016 S-1/A 333-226040 3.1.2 4/4/2019 3.3 Certificate of Change to Articles of Incorporation dated April 11, 2019 8-K 001-38868 3.1 4/18/2019 3.4 Certificate of Amendment to Articles of Incorporation dated September 14, 2020 8-K 000-53204 3.1 9/14/2020 3.5 Certificate of Amendment to Articles of Incorporation dated July 20, 2021 8-K 001-38868 3.1 7/20/2021 3.6 Certificate of Correction to the Amendment After Issuance of Stock filed December 15, 2023 10-K 001-38868 3.6 4/11/2025 3.7 Bylaws of Registrant SB-2 333-147104 3.2 11/2/2007 3.8 Amendment to Bylaws 8-K 000-53204 10.2 7/16/2014 4.1 Common Stock Purchase Warrant dated March 22, 2023 X 10.1* Separation Agreement with Sandra Peterson dated January 20, 2025 8-K 000-53204 10.1 1/24/2025 10.2 At Market Issuance Sales Agreement with B. Riley Securities, Inc. dated as of April 11, 2025 10-K 000-53204 10.17 4/11/2025 10.3 Consulting Agreement dated March 22, 2023 with 58 Concourse Partners LLC X 31.1 Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act X 31.2 Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act X 32.1 Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act X 32.2 Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act X 34 101.INS Inline XBRL Instance Document X 101.SCH Inline XBRL Schema Document X 101.CAL Inline XBRL Calculation Linkbase Document X 101.DEF Inline XBRL Definition Linkbase Document X 101.LAB Inline XBRL Labels Linkbase Document X 101.PRE Inline XBRL Presentation Linkbase Document X 104 The cover page to this Quarterly Report on Form 10-Q has been formatted in Inline XBRL X *Represents a compensatory plan or arrangement 35 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Dated: May 15, 2025 Beam Global By: /s/ Desmond Wheatley Desmond Wheatley, Chairman and Chief Executive Officer, (Principal Executive Officer) By: /s/ Lisa A. Potok Lisa A. Potok, Chief Financial Officer (Principal Financial/Accounting Officer) 36