What changed in this filing

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Item 1. Financial Statements

2025-08-14 compared with 2025-05-15 · 511 added, 343 removed, 495 unchanged (63% of the section changed)

3 unchanged sentences

except share and per share data)

Three Months Ended

Current assets

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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.

Preferred stock, $ 0.001 par value, 10,000,000 authorized, none outstanding as of June 30, 2025 and December 31, 2024

Common stock, $ 0.001 par value, 350,000,000 shares authorized, 16,858,931 and 14,835,630 shares issued and outstanding as of June 30, 2025 and December 31, 2024, respectively

Additional paid-in-capital

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Total liabilities and stockholders' equity

The accompanying unaudited notes are an integral

part of these unaudited condensed consolidated Financial Statements

Condensed Consolidated Statement of Operations

and Comprehensive Loss

The accompanying unaudited notes are an integral part

of these unaudited condensed consolidated Financial Statements

Condensed Consolidated Statement of Operations and

Comprehensive Loss

(Unaudited, in thousands except per share data)

Three Months Ended

Six Months Ended

Cost of revenues

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Interest expense

Loss before income tax expense

Net foreign currency translation benefit (expense)

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Weighted average shares outstanding - basic/diluted

The accompanying unaudited notes are an integral

part of these unaudited condensed consolidated financial statements

The accompanying unaudited notes are an integral part

of these unaudited condensed consolidated Financial Statements

Consolidated Statements of Changes in Stockholders’

(Unaudited, in thousands)

Additional Paid-in-

Accumulated Other Comprehensive

Total Stockholders'

Accumulated Other Additional

Accumulated Other

Comprehensive

Stockholders'

Balance at December 31, 2024

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Stock issued for director services - vested

Stock issued to (released from) escrow account - unvested

Stock issued to (released from)

escrow account - unvested

Employee stock-based compensation expense

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$ ( 120,166 )

Balance at December 31, 2023

Stock issued for director services - vested

Stock issued to (released from)

escrow account - unvested

Settlement of earnout related to acquisition

Employee stock-based compensation expense

Stock based compensation

Impact of foreign currency translation

Sale of stock under Committed Equity Facility

Net income (loss)

Balance at June 30, 2025

$ ( 124,444 )

Balance at December 31, 2023

Stock issued for director services

Employee stock-based compensation

Warrants exercised for cash

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Balance at March 31, 2024

The accompanying unaudited notes are an integral

part of these unaudited condensed consolidated Financial Statements

Stock issued for director services - vested

Employee stock-based compensation expense

Warrants exercised for cash

Impact of foreign currency translation

Sale of stock under Committed Equity Facility

Net income (loss)

Balance at June 30, 2024

$ ( 101,314 )

The accompanying unaudited notes are an integral part

of these unaudited condensed consolidated Financial Statements

Condensed Consolidated Statements of Cash Flows

(Unaudited, in thousands)

Three Months Ending

Six Months Ended June 30,

Operating Activities:

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Amortization of operating lease right of use asset

Abandoned patent costs

Changes in assets and liabilities:

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Accrued expenses

Operating lease liability

Sales tax payable

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Financing Activities:

Proceeds from warrant exercises

Proceeds from sale of common stock under committed equity facility, net of offering costs

Warrants exercised for cash

Repayments of note payable

Borrowings of note payable

Net cash provided (used) by financing activities

Net cash provided by financing activities

Effect of exchange rate changes

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Supplemental Disclosure of Non-Cash Investing and Financing Activities:

Settlement of earnout related to acquisition

Purchase of property and equipment by incurring current liabilities

Right-of-use assets obtained in exchange for lease liabilities

The accompanying unaudited notes are an integral

part of these unaudited condensed consolidated Financial Statements

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL

Transfer of prepaid asset to inventory

The accompanying unaudited notes are an integral part

of these unaudited condensed consolidated Financial Statements

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

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.

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 offices 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),

in Belgrade and Kraljevo, Serbia;

and in Abu Dhabi, United Arab Emirates.

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

we manufacture 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.

products and proprietary technology solutions target the following markets :

security and disaster preparedness;

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:

EV charging infrastructure;

Smart Cities infrastructure;

Energy storage solutions;

charging infrastructure;

Energy security and disaster preparedness;

Transportation infrastructure products;

electronics and telecommunications equipment

Power electronics and telecommunications equipment

Basis of Presentation

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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.

adjustments and reclassifications) necessary to present fairly our results of operations and cash flows for the three and six months ended

June 30, 2025 and 2024, and our financial position as of June 30, 2025, have been made.

The results of operations for such interim periods

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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.

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

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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

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”).

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with early adoptions prohibited.

In December 2023, the FASB

issued ASU No.

In December 2023, the FASB issued

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

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.

The Company is currently evaluating the impact that the updated standard will have on our consolidated financial

Concentrations

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.

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 June 30, 2025.

As of June 30, 2025, approximately $ 1.7 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 %

June 30, 2025, one customer accounted for 10 %

of total revenues and for the three months ended June 30, 2024, three customers accounted for 21 %, 11 %

of total revenues, each with no other single customer accounting for more than 10% of revenues.

For the six months ended June 30,

2025 no one customer accounted for more than 10% of revenues and only one customer accounted for 25 %

of total revenues for the six months ending June 30, 2024.

At June 30, 2025, accounts receivable from one customer accounted for 12 %

of total accounts receivable and at June 30, 2024, accounts receivable from three customers accounted for

of total accounts receivable each with no other single customer accounting for more than 10% of the accounts receivable balance.

the three months ended June 30, 2025 and 2024, the Company’s concentration of sales to federal customers represented 2 %

of revenues, respectively and the concentration of sales to state and local governments represented 32 %

of revenues, respectively.

For the six months ended June 30, 2025 and 2024, the Company’s concentration of sales to federal

customers represented 8 %

of revenues, respectively and the concentration of sales to state and local governments represented 32 %

of revenues, respectively.

Foreign Operations

The following summarizes

key financial metrics associated with the Company’s continuing operations:

The following summarizes key

financial metrics associated with the Company’s continuing operations:

Schedule of concentration risk

Assets - Serbia

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Total Liabilities

Three Months Ended

Six Months Ended

Sales - Serbia

Total Revenues

Net Loss - Serbia

Net Income/(Loss) - Serbia

Net Loss - U.S.

Total Net Loss

Total Net Loss for the three months ending March 31, 2025 was $15.5 million compared to $3.0 million

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.

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.

Management does not believe that the carrying value will not be recoverable

however the sustained decline in our stock price has triggered a determination of the fair

value of the reporting unit, requiring 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.

During the three months ending

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Management believes this decline

in market value is due to a variety of factors, as further described below.

in market value is due to a variety of factors, as further described below, but not the actual value of the acquired entities which included

the goodwill which is being impaired.

Considering the circumstances and indicators of potential

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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.

the results of the goodwill impairment procedures, the Company recorded a $ 10.8

The Company concluded that

the sustained stock price decline in the Company’s common stock and its market capitalizations as of March 31, 2025 was a

triggering event which required Management to perform a quantitative goodwill impairment test.

Management determined the value of

goodwill largely based on the Company’s stock price and not on the activities or performance of the acquired entities.

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, created a condition in which the accounting rules determine 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.

The Company does business and

extends credit based on an evaluation of each customer’s financial condition, generally without requiring collateral.

reviews accounts receivable on a periodic basis to determine if any receivables may become uncollectible.

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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.

monitors exposure to credit losses and maintains allowances for anticipated losses considered necessary under the circumstances.

of the allowance for credit losses for the three months ended March 31, 2025 and December 31, 2024:

with the customer, the financial profile of a customer, the Company’s historical write-off experience, net of recoveries, and economic

Exposure to losses from receivables is expected to vary by customer due to the financial condition of each customer.

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 June 30, 2025 and December 31, 2024:

Schedule of accounts receivable

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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.

can be readily observable, market corroborated or generally unobservable.

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

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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:

The hierarchy is broken down into

three levels based on the reliability of inputs as follows:

Level 1 – Quoted prices

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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.

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

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

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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.

nature as of June 30, 2025.

The Company had Level 3 liabilities as of June 30, 2025.

There were no transfers between levels during the

reporting period.

Schedule of contingent consideration

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Change in fair value

Contingent Consideration as of March 31, 2025

Contingent Consideration as of June 30, 2025

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

June 30, 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.

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:

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.

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

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in a single operating segment.

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.

March 31, 2025, the Company had a cash balance of $ 2.5

million and working capital of $ 10.8

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

The Company had net losses of

$ 19.8 million for the six months ended June

30, 2025 which includes $ 15.1 million

of non-cash expenses that mainly included impairment of goodwill of 10.8 million, employee stock-based compensation of $ 2.2 million and

depreciation and amortization of $ 1.8 million.

The Company had net losses of $ 8 .0

million for the six months ending June 30, 2024 which includes $ 4.2

million of non-cash expenses that included depreciation and amortization of $ 1.9 million, employee stock-based compensation expense of

$ 1.3 million, offset by decreases of $ 0.6 million provision on credit losses and $ 1.5 million for a change in fair value of contingent

consideration liabilities.

The Company had net cash used in operating activities of $ 2.1 million $ 0.1 million for the six months ended

June 30, 2025 and 2024, respectively.

30, 2025, the Company had a cash balance of $ 3.4 million and working capital of $ 9.8 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

$ 6.1 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.

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

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BUSINESS COMBINATIONS

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

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

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 power electronics and 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,

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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

Consideration that the Telcom Sellers were 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.

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Beam’s common stock in an amount that exceeds 19.99% of the outstanding common stock of Beam immediately prior to closing.

The acquisition was accounted

for as a business combination in accordance with Accounting Standards Codification (ASC) 805, Business Combinations .

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.

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):

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

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 six months ended June 30, 2025 is as follows (in thousands):

Schedule of change in the fair value of the

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Change in Fair Value

Balance as of March 31, 2025

Balance as of June 30, 2025

The following table summarizes

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earn-out targets.

Consideration is comprised

of the following (in thousands):

Consideration is comprised of

the following (in thousands):

Schedule of consideration comprised

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Net assets acquired

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

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.

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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):

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 six months ended June 30, 2024 (in thousands):

Schedule of pro

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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.

acquisition been completed at the beginning of the six months ended June 30, 2024.

In addition, the unaudited pro forma financial information

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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.

The statement of operations, in

the table above, for the six months ended June 30, 2024 includes revenues of $ 0.4 million and income from operations of $ 17 thousand from

the acquired Telcom business.

Beam Middle East, LLC.

On June 20, 2025, the Company

entered into a Joint Venture Agreement (the “Joint Venture Agreement”) with The Platinum Group, a company registered with

the department of Economy – Abu Dhabi (“TPG”).

Pursuant to the agreement, the Company has agreed to establish Beam Middle

East, LLC, a Limited Liability Company in Abu Dhabi, in the United Arab Emirates for the purpose of marketing, selling, manufacturing

and distributing Beam Global’s products (the “Joint Venture”) in accordance with the terms of the Joint Venture Agreement

and the strategy, business plan, and budget of the Joint Venture (the “Plan”).

Beam Global and TPG shall have a 50% equity

interest in the Joint Venture.

TPG is engaged in the fields of energy, real estate, finance and investing, healthcare, information technology,

sports and entertainment, food services and legal services.

Pursuant to the Joint Venture

Agreement, the Company shall be responsible to make timely capital contributions to the Joint Venture to cover all expenses as mutually

agreed in the Plan to the extent not covered by Joint Venture cash flows or by authorized borrowings of the Joint Venture.

30, 2025, there have been no capital contributions.

100% of the profits generated by the Joint Venture will be distributed to Beam Global

until such time as any capital contributions made by the Company have been returned to the Company.

Thereafter each of the Company and

TPG shall receive an equal share of the profits in accordance with their equity ownership.

The Joint Venture is managed by five (5) directors

(the “JV Board”), two (2) of which are appointed by TPG (the “TPG Directors”), two (2) of which are appointed

by the Company (the “Company Directors”), and a fifth being an independent director appointed by mutual approval of both TPG

and the Company.

The JV Board has full power to manage and control all aspects of the Joint Venture’s business and affairs;

that , certain “Major Decisions” (as defined in the Joint Venture Agreement) must be approved by each of the Company Directors.

The Joint Venture Agreement may be terminated upon the expiration or non-renewal of the License Agreement (as defined below), by unanimous

resolution of the Company and TPG, or upon a judicial determination.

The Company will consolidate the financials of Beam Middle East,

LLC in accordance with ASC 810-10.

In connection with entering

into Joint Venture Agreement, the Company agreed to enter into a license agreement with the Joint Venture (the “License Agreement”),

permitting the Joint Venture to use certain of the Company’s intellectual property, without additional compensation, on and subject

to the terms set forth in the License Agreement.

The License Agreement continues for a period of five (5) years, with subsequent five-year

renewal options.

The Company may terminate the License Agreement (i) in the event of a default of TPG;

(ii) if the Company no longer controls

at least fifty percent (50%) of the voting interest of the Joint Venture and the right to appoint two (2) of the five (5) directors of

the Joint Venture;

or (iii) upon thirty (30) days’ prior written notice to the Joint Venture and TPG if the Joint Venture does not

reasonably commence development, production, or sales efforts on or before December 31, 2025.

PREPAIDS AND OTHER CURRENT ASSETS

Prepaid expenses and other

current assets are summarized as follows (in thousands):

Prepaid expenses and other current

assets are summarized as follows (in thousands):

Schedule of prepaid expenses and other

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Total prepaid expenses and other current assets

Inventories are stated at the lower of cost and

net realizable value.

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):

As of June 30, 2025 and December 31, 2024, inventory

consists of the following (in thousands):

Schedule of inventory

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Property and Equipment, net

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.

Depreciation expense during the

three months ended June 30, 2025 and 2024 was $ 0.6

million and $ 0.7 million respectively.

six months ended June 30, 2025 and 2024, depreciation expense was $ 1.3

million and $ 1.4 million respectively.

For the three and six months ended June 30, 2025 and 2024, depreciation expense recognized in Operating expenses was $ 0.1

million and $ 0.2

million in both years respectively.

Depreciation recognized in Cost of Goods Sold for the three months ended June 30, 2025 and

2024 was $ 0.5 million

and $ 0.1 million respectively.

Depreciation recognized in Cost of Goods Sold for the six months ended June 30, 2025 and 2024 was $ 1.1

million and $ 0.2 million respectively.

GOODWILL AND INTANGIBLE ASSETS

The following table presents

the Company's goodwill asset:

The following table presents the

Company's goodwill asset (in thousands):

Schedule of goodwill asset

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Ending balance

Intangible assets, net, as of March 31, 2025 and

Intangible assets, net, as of June 30, 2025 and December

31, 2024 consists of the following (in thousands):

Schedule of intangible assets

December 31, 2024

June 30, 2025

Gross Carrying Amount

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Intangible assets

March 31, 2025

December 31, 2024

Gross Carrying Amount

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Intangible assets

expense for each of the three months ended March 31, 2025, and 2024 was $ 0.2

Amortization expense for

each of the three and six months ended June 30, 2025, and 2024 was $ 0.2

million and $ 0.5 million,

respectively.

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.

million for each of the years 2025 through 2028.

Amortization expense recognized in Operating expenses for the three months and six

months ended June 30, 2025 and 2024 was $ 0.1

million for both years.

Amortization expense recognized in in Cost of Goods Sold for the three months ended June 30, 2025 and 2024

was $ 0.2 million for both years and for the six months ended June 30, 2025 and 2024 was $ 0.4

million for both years.

Total estimated amortization

on the Company’s intangible assets for each of the years ending December 31, 2025 through 2030 and thereafter is as follows (in

Schedule of estimated amortization

Calendar Years

Amortization Expense

ACCRUED EXPENSES AND LONG-TERM LIABILITIES

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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.

of $ 3.5 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 remainder is categorized in long-term liability.

restructuring was entered into in 2021 for a nine-year term with five years and six months remaining at June 30, 2025.

interest free, not secured, and due quarterly as a percentage of the remaining balance due.

thousand consists of non-current liabilities related to the acquisition of Telcom.

Approximately $ 30

thousand is current and included in other accrued expenses and the rest is categorized in long-term liability.

thousand is current and included in other accrued expenses and the remainder is categorized in long-term liability.

In May 2023, the Company purchased

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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.

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

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of associated cost and diversion of management time.

As of March 31, 2025, after consulting with legal counsel, management believes there

As of June 30, 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.

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capital for the Company.

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

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.

We face uncertainty related

to tariffs and other trade policies, which may increase the costs of securing products from our vendors.

Tariffs and other non-tariff

trade practices and policies may adversely affect our business in other ways beyond increased costs for our products.

Historically, we

have taken steps to shift our sourcing strategy away from countries with higher tariff rates in favor of other jurisdictions, but these

countermeasures may prove to be ineffective and the ability to predict tariff rates in different countries may be difficult as policies

may change on short notice.

Uncertainty about trade policy, tariff rates, retaliatory tariffs, and other changes in practices affecting

international trade might have an adverse effect on our business and results of operation and we may face challenges in implementing optimal

responses to changing trade conditions.

We continue to monitor macroeconomic trends and uncertainties and changes in international trade

relations and trade policy, including those related to tariffs.

government has implemented a general tariff on all imports from

countries not exempted under certain trade reciprocity criteria and elevated tariffs have been imposed on imports from major trading partners.

Impacted countries have and may impose retaliatory tariffs, and such actions could give rise to an escalation of other trade measures

by the countries subjected to such tariffs.

Furthermore, the tariff policy environment is rapidly evolving and there is no guarantee that

additional or increased tariffs will not be imposed.

June 26, 2025, the Company entered into a Lease Extension Agreement with PNN Holdings, LP relating to the Company’s

headquarters located at 5660 Eastgate Drive, San Diego, CA 92121.

The term of the existing lease is extended for an additional six

(6) months and now terminates on February 28, 2026.

During the extension term, the monthly base rent will be $62,400, plus

additional rent of $9,080 for common area maintenance and other NNN charges, for a total monthly payment of $71,480.

The agreement

also provides that any time after November 1, 2025, the Landlord may terminate the lease upon sixty (60) days’ prior written

notice to the Company.

Except as modified by the agreement, the terms and conditions of the original lease remain in full force and

The table below summarizes

the Company’s lease related assets and liabilities as of June 30, 2025 and December 31, 2024 (in thousands):

Schedule of lease assets and liabilities

For the period ending

Lease liabilities

Current operating lease liabilities, included in current liabilities

Noncurrent operating lease liabilities, included in long-term liabilities

Total Lease liabilities

As the Company’s leases

do not provide an implicit rate, the Company uses its incremental borrowing rate to discount the lease payments to present value.

estimated incremental borrowing rate is derived from information available at the lease commencement date.

rental commitments for our operating leases are as follows (in thousands):

Schedule of minimum lease

Total undiscounted future minimum payments

Less imputed interest

Total lease liability

There was no Federal income tax

expense for the six months ended June 30, 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 June 30, 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.

STOCKHOLDERS’ EQUITY

Market Issuance Sales Agreement

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.

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.

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 shares of itscommon stock having an aggregate offering price of up to $ 8 million, subject to certain terms and

Stock Options

Stock options may be granted

to new and existing employees and other eligible participants under the Company’s equity incentive plan.

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.

Option activity for the three months ended March

Option activity for the six months ended June 30,

2025 is as follows:

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Outstanding at December 31, 2024

Outstanding at March 31, 2025

Outstanding at June 30, 2025

Vested and Exercisable at June 30, 2025

The fair value of each option

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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 fair value of each option

is estimated on the date of grant using the Black-Scholes option-pricing model using the assumptions in the table below and we assumed

there would not be dividends paid during the life of the options granted during the six months ended June 30, 2025 and 2024:

Six months ended June 30,

Expected volatility

88.38% - 89.35%

91.6% - 94.5%

Expected term

6.5 - 7 Years

Risk-free interest rate

4.06% - 4.14%

3.55% - 3.77%

Weighted-average FV

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.

option compensation expense was $ 1.5

million and $ 1.6

million for the three months ended June 30, 2025 and 2024, respectively, and $ 0.1

million and $ 0.3

million for the six months ended June 30, 2025 and 2024, respectively.

There was $ 1 .0

million of total unrecognized compensation costs related to outstanding stock options at June 30, 2025 which will be recognized over 3.3

There were no

options exercised in the six months ended June 30, 2025.

The number of stock options vested and unvested as of June 30, 2025 were 406,769

and 233,135 ,

respectively.

Stock-based compensation expense is generally included in selling, general and administrative expenses in the

consolidated statement of operations.

On June 4, 2025, the Compensation

Committee recommended and approved a one-time stock award of 870,000 shares of common stock to the Company’s chief executive officer,

Desmond Wheatley, under the Company’s 2021 Equity Incentive Plan.

The common stock award was granted as bonus compensation based

on his performance in fiscal years ending December 31, 2023 and 2024, and in connection with the completed acquisitions of All Cell Technologies,

LLC, Amiga DOO Kraljevo and Telcom d.o.o.

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

In November 2022, the Board

approved a stock grant under the Company’s 2021 Equity Incentive Plan to Mr.

Wheatley, 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

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.

of shares issuable under the PSUs were determined based on the achievement of performance metrics specific to the Company that were

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.

1 unchanged sentence

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

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:

There have been no further grants as of the six months ended June 30, 2025.

A summary of activity of the RSUs for the six months

ended June 30, 2025 is as follows:

Schedule of RSU activity

2 unchanged sentences

Unvested at end of 2025

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.

Stock compensation expense related

to restricted stock units was $ 35 thousand during the six months ended June 30, 2025.

Stock compensation expense related to performance

stock units was $ 0.2 million during the six months ended June 30, 2025.

There are no further unrecognized stock compensation expenses

remaining to be recognized at this time.

Restricted Stock Awards

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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:

A summary of activity of the restricted stock awards

for the six months ended June 30, 2025:

Schedule of restricted stock awards

Average Grant-

Date Fair Value

Nonvested at December 31, 2024

Nonvested at March 31, 2025

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.

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.

Weighted Average Grant Date Fair Value

Unvested at December 31, 2024

Unvested at June 30, 2025

Stock compensation expense related

to restricted stock awards was $ 0.2 million for the six months ended June 30, 2025 and $ 13 thousand for the six months ended June 30,

Fair values of restricted stock vested during each of the six months ended June 30, 2025 and 2024 were $ 0.1 million and $ 4 thousand,

respectively.

As of June 30, 2025, there were

unvested shares of common stock representing $ 0.2 million of unrecognized restricted stock grant expense which will be recognized over

During the six months ended June

30, 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.

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.

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 six months ended June 30, 2025, $ 0.2 million was recorded as expense and at June 30, 2025, $0.9 million

of cost has not been recognized and will be recognized over the next 2.7 years.

These warrants are not cashless and expire on March 31,

A summary of activity of warrants outstanding

for the three months ended March 31, 2025 is as follows:

A summary of activity of warrants outstanding for the

six months ended June 30, 2025 is as follows:

Schedule of activity of warrants outstanding

2 unchanged sentences

Outstanding at December 31, 2024

Outstanding at March 31, 2025

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

For each of the identified

periods, revenues are categorized as follows (in thousands):

Outstanding at June 30, 2025

The intrinsic value of the

shares of common stock underlying the exercisable warrants at June 30, 2025 was $ 0.00 .

For each of the identified periods,

revenues are categorized as follows (in thousands):

Schedule of revenues

Three Months Ended

Six Months Ended

Product sales

5 unchanged sentences

The following table disaggregates

gross revenue from our clients by significant geographic area for the three months ended March 31, 2025 and 2024:

gross revenue from our clients by significant geographic area for the three and six months ended June 30, 2025 and 2024:

Schedule of disaggregates gross revenue

For the Three Months Ended

Six Months Ended

United States

Total revenue

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.

During the three and six months

ended June 30, 2025 and 2024, 2 %, 8 %, 35 % and 47 % of revenues were derived from federal customers, respectively, while 32 %, 32 %, 34 % and

30 % were from state and local governments, respectively.

In addition, 47 % and 37 % of revenues in the three and six months ended June 30,

2025 were sales made outside of the United States compared to 19 % and 15 % in the prior year.

At June 30, 2025 and 2024, deferred

revenue was $ 1.7 million and $ 1.5 million, respectively.

These amounts consisted mainly of customer deposits in the amount of $ 0.5 million

and $ 1 .0 million for June 30, 2025 and 2024, respectively, and prepaid multi-year maintenance plans for previously sold products which

account for $ 1.2 million and $ 0.8 million for June 30, 2025 and 2024, respectively, and pertain to services to be provided through 2035.

Revenue recognized during the six months ended June 30, 2025 and 2024 which pertained to revenue deferred in prior years was $ 114 thousand

and $ 53 thousand, respectively.

The balance of contract assets

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Schedule of contract liabilities

For the Three Months Ended

For the Six Months Ended

Beginning Balance

2 unchanged sentences

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

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.

2 unchanged sentences

Expense information, including cost of sales, can

be easily computed from the provided information.

be easily computed from the information provided.

These segment (and consolidated) measures of profitability are shown in the statements

2 unchanged sentences

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

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.

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.

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.

of the current uncertainty regarding economic activity, the Company is unable to predict the size and duration of the impact to 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.

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.

On July 4, 2025, the United

States Congress passed budget reconciliation bill H.R.

1, referred to as the One Big Beautiful Bill Act (“OBBBA”).

is currently evaluating the potential effects of the OBBBA on its consolidated financial statements.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements