Blink Charging Co. 10-Q

ITEM 1. FINANCIAL STATEMENTS. BLINK CHARGING CO. Unaudited Condensed Consolidated Balance Sheets (in thousands, except for share amounts) June 30, December 31, 2024 2023 Assets Current Assets: Cash and cash equivalents $ 73,885 $ 121,691 Accounts receivable, net 49,609 45,447 Inventory, net 44,454 47,942 Prepaid expenses and other current assets 5,227 6,654 Total Current Assets 173,175 221,734 Restricted cash 75 79 Property and equipment, net 40,317 35,127 Operating lease right-of-use asset 8,185 9,731 Intangible assets, net 13,001 16,298 Goodwill 144,881 144,881 Other assets 638 669 Total Assets $ 380,272 $ 428,519 Liabilities and Stockholders’ Equity Current Liabilities: Accounts payable $ 29,623 $ 31,193 Accrued expenses and other current liabilities 12,745 14,143 Notes payable 265 6,792 Current portion of operating lease liabilities 3,311 3,448 Current portion of financing lease liabilities 238 512 Current portion of deferred revenue 15,192 13,613 Total Current Liabilities 61,374 69,701 Consideration payable 20,565 49,434 Operating lease liabilities, non-current portion 5,993 7,025 Financing lease liabilities, non-current portion 115 163 Other liabilities 337 337 Deferred revenue, non-current portion 13,515 12,462 Total Liabilities 101,899 139,122 Commitments and contingencies (Note 8) - - Stockholders’ Equity: Common stock, $ 0.001 par value, 500,000,000 shares authorized, 101,067,207 and 92,818,233 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively 101 93 Additional paid-in capital 857,400 829,563 Accumulated other comprehensive loss ( 4,173 ) ( 2,536 ) Accumulated deficit ( 574,955 ) ( 537,723 ) Total Stockholders’ Equity 278,373 289,397 Total Liabilities and Stockholders’ Equity $ 380,272 $ 428,519 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 1 BLINK CHARGING CO. Condensed Consolidated Statements of Operations (in thousands, except for share and per share amounts) (unaudited) 2024 2023 2024 2023 For The Three Months Ended For The Six Months Ended June 30, June 30, 2024 2023 2024 2023 Revenues: Product sales $ 23,582 $ 24,587 $ 51,090 $ 40,976 Charging service revenue - company-owned charging stations 4,936 4,367 9,963 7,252 Network fees 1,907 1,667 3,972 3,295 Warranty 1,340 921 2,293 1,314 Grant and rebate 52 188 635 237 Car-sharing services 1,202 957 2,299 1,209 Other 243 155 578 227 Total Revenues 33,262 32,842 70,830 54,510 Cost of Revenues: Cost of product sales 14,241 13,159 30,843 24,890 Cost of charging services - company-owned charging stations 495 743 1,200 1,630 Host provider fees 3,282 2,239 6,324 3,886 Network costs 650 495 1,239 932 Warranty and repairs and maintenance 981 1,415 1,586 2,363 Car-sharing services 1,284 1,594 2,146 2,231 Depreciation and amortization 1,616 906 3,360 1,744 Total Cost of Revenues 22,549 20,551 46,698 37,676 Gross Profit 10,713 12,291 24,132 16,834 Operating Expenses: Compensation 17,654 37,990 32,611 60,699 General and administrative expenses 8,003 10,475 15,810 17,146 Other operating expenses 4,958 4,916 11,396 9,111 Change in fair value of consideration payable 747 - 2,447 - Total Operating Expenses 31,362 53,381 62,264 86,956 Loss From Operations ( 20,649 ) ( 41,090 ) ( 38,132 ) ( 70,122 ) Other Income (Expense): Interest expense ( 46 ) ( 786 ) ( 473 ) ( 1,403 ) Change in fair value of derivative and other accrued liabilities ( 17 ) - ( 15 ) 10 Dividend and interest income 817 600 1,580 650 Total Other Income (Expense) 754 ( 186 ) 1,092 ( 743 ) Loss Before Income Taxes $ ( 19,895 ) $ ( 41,276 ) $ ( 37,040 ) $ ( 70,865 ) Provision for income taxes ( 164 ) ( 206 ) ( 192 ) ( 418 ) Net Loss $ ( 20,059 ) $ ( 41,482 ) $ ( 37,232 ) $ ( 71,283 ) Net Loss Per Share: Basic $ ( 0.20 ) $ ( 0.67 ) $ ( 0.37 ) $ ( 1.20 ) Diluted $ ( 0.20 ) $ ( 0.67 ) $ ( 0.37 ) $ ( 1.20 ) Weighted Average Number of Common Shares Outstanding: Basic 101,009,593 61,882,330 100,456,032 59,176,129 Diluted 101,009,593 61,882,330 100,456,032 59,176,129 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 2 BLINK CHARGING CO. Condensed Consolidated Statements of Comprehensive Loss (in thousands) (unaudited) 2024 2023 2024 2023 For the Three Months Ended For the Six Months Ended June 30, June 30, 2024 2023 2024 2023 Net Loss $ ( 20,059 ) $ ( 41,482 ) $ ( 37,232 ) $ ( 71,283 ) Other Comprehensive Income (Loss): Cumulative translation adjustments ( 400 ) 1,145 ( 1,637 ) 295 Total Comprehensive Loss $ ( 20,459 ) $ ( 40,337 ) $ ( 38,869 ) $ ( 70,988 ) The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 3 BLINK CHARGING CO. Condensed Consolidated Statements of Changes in Stockholders’ Equity For the Three and Six Months Ended June 30, 2024 (in thousands, except for share amounts) (unaudited) Accumulated - Common Stock Additional Paid-In Other Comprehensive Accumulated Total Stockholders’ Shares Amount Capital Loss Deficit Equity Balance - January 1, 2024 92,818,233 $ 93 $ 829,563 $ ( 2,536 ) $ ( 537,723 ) $ 289,397 Common stock issued in public offering, net of issuance costs [1] 8,177,472 8 25,062 - - 25,070 Stock-based compensation 837 - 681 - - 681 Other comprehensive loss - - - ( 1,237 ) - ( 1,237 ) Net loss - - - - ( 17,173 ) ( 17,173 ) Balance - March 31, 2024 100,996,542 $ 101 $ 855,306 $ ( 3,773 ) $ ( 554,896 ) $ 296,738 Stock-based compensation - - 1,269 - - 1,269 Common stock issuance, net 70,665 - 825 - - 825 Other comprehensive loss - - - ( 400 ) - ( 400 ) Net loss - - - - ( 20,059 ) ( 20,059 ) Balance - June 30, 2024 101,067,207 $ 101 $ 857,400 $ ( 4,173 ) $ ( 574,955 ) $ 278,373 [1] Includes gross proceeds of $ 25,651 , less issuance costs of $ 581 . The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 4 BLINK CHARGING CO. Condensed Consolidated Statements of Changes in Stockholders’ Equity For the Three and Six Months Ended June 30, 2023 (in thousands, except for share amounts) (unaudited) Accumulated Additional Other Total Common Stock Paid-In Comprehensive Accumulated Stockholders’ Shares Amount Capital Loss Deficit Equity Balance - January 1, 2023 51,476,445 $ 51 $ 597,982 $ ( 3,046 ) $ ( 334,030 ) $ 260,957 Common stock issued in public offering, net of issuance costs [1] 8,333,333 8 94,758 - - 94,766 Common stock issued upon exercises of warrants 557,733 1 834 - - 835 - Stock-based compensation 5,866 - 7,757 - - 7,757 Other comprehensive loss - - - ( 850 ) - ( 850 ) Net loss - - - - ( 29,801 ) ( 29,801 ) Balance - March 31, 2023 60,373,377 $ 60 $ 701,331 $ ( 3,896 ) $ ( 363,831 ) $ 333,664 Balance 60,373,377 $ 60 $ 701,331 $ ( 3,896 ) $ ( 363,831 ) $ 333,664 Stock-based compensation 376,778 - 8,708 - - 8,708 Common stock issued in public offering, net of issuance costs [2] 2,842,687 4 18,484 - - 18,488 Reclassification of common stock liability to equity 8,235 - 35 - - 35 Common stock issued upon cashless exercise of options and warrants 393,240 - - - - - Other comprehensive income - - - 1,145 - 1,145 Net loss - - - - ( 41,482 ) ( 41,482 ) Balance - June 30, 2023 63,994,317 $ 64 $ 728,558 $ ( 2,751 ) $ ( 405,313 ) $ 320,558 Balance 63,994,317 $ 64 $ 728,558 $ ( 2,751 ) $ ( 405,313 ) $ 320,558 [1] Includes gross proceeds of $ 100,000 , less issuance costs of $ 5,234 . [2] Includes gross proceeds of $ 18,868 , less issuance costs of $ 380 . The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 5 BLINK CHARGING CO. Condensed Consolidated Statements of Cash Flows (in thousands) (unaudited) 2024 2023 For The Six Months Ended June 30, 2024 2023 Cash Flows From Operating Activities: Net loss $ ( 37,232 ) $ ( 71,283 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 6,579 6,825 Non-cash lease expense 2,438 833 Change in fair value of contingent consideration - 41 Loss on disposal of fixed assets 39 33 Change in fair value of derivative and other accrued liabilities ( 15 ) 10 Change in fair value of consideration payable 2,447 - Provision for slow moving and obsolete inventory 822 65 Provision for credit losses 903 1,318 Stock-based compensation 1,950 19,439 Changes in operating assets and liabilities: Accounts receivable ( 6,990 ) ( 20,630 ) Inventory 2,239 ( 11,855 ) Prepaid expenses and other current assets 1,349 ( 1,073 ) Other assets 26 898 Accounts payable and accrued expenses ( 1,099 ) 7,379 Other liabilities - ( 258 ) Lease liabilities ( 2,052 ) ( 2,232 ) Deferred revenue 2,861 5,450 Total Adjustments 11,497 6,243 Net Cash Used In Operating Activities ( 25,735 ) ( 65,040 ) Cash Flows From Investing Activities: Purchase consideration of Envoy, net of cash acquired - ( 4,660 ) Capitalization of engineering costs ( 155 ) ( 526 ) Purchases of property and equipment ( 8,584 ) ( 5,647 ) Net Cash Used In Investing Activities ( 8,739 ) ( 10,833 ) Cash Flows From Financing Activities: Proceeds from sale of common stock in public offering, net [1] 25,070 113,254 Repayment of note payable ( 37,881 ) - Proceeds from exercise of options and warrants - 835 Repayment of financing liability in connection with finance lease ( 375 ) ( 1,443 ) Payment of financing liability in connection with internal use software ( 286 ) ( 220 ) Net Cash (Used In) Provided By Financing Activities ( 13,472 ) 112,426 Effect of Exchange Rate Changes on Cash and Cash Equivalents 136 1,354 Net (Decrease) Increase In Cash and Cash Equivalents and Restricted Cash ( 47,810 ) 37,907 Cash and Cash Equivalents and Restricted Cash - Beginning of Period 121,770 36,633 Cash and Cash Equivalents and Restricted Cash - End of Period $ 73,960 $ 74,540 Cash and cash equivalents and restricted cash consisted of the following: Cash and cash equivalents $ 73,885 $ 74,464 Restricted cash 75 76 $ 73,960 $ 74,540 [1] Includes gross proceeds of $ 25,651 , less issuance costs of $ 581 . The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 6 BLINK CHARGING CO. Condensed Consolidated Statements of Cash Flows — Continued (in thousands) (unaudited) 2024 2023 For The Six Months Ended June 30, 2024 2023 Supplemental Disclosures of Cash Flow Information: Cash paid during the period for: Interest $ 1,436 $ - Income taxes $ 233 $ - Non-cash investing and financing activities: Right-of-use assets obtained in exchange for lease obligations $ 653 $ 4,765 Property and equipment obtained in exchange for finance lease obligations $ 53 $ 2,798 Intangible assets obtained in exchange for financing liability $ - $ 122 Note receivable applied to purchase consideration of Envoy $ - $ ( 1,321 ) Common stock issuance, net $ 825 $ - Transfer of inventory to property and equipment $ 130 $ 1,241 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 7 BLINK CHARGING CO. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (in thousands except for share and per share amounts) 1. BUSINESS ORGANIZATION, NATURE OF OPERATIONS, BASIS OF PRESENTATION AND RISKS AND UNCERTAINTIES Organization and Operations Blink Charging Co., through its wholly-owned subsidiaries (collectively, the “Company” or “Blink”), is a leading manufacturer, owner, operator and provider of electric vehicle (“EV”) charging equipment and networked EV charging services in the rapidly growing U.S. and international markets for EVs. Blink offers residential and commercial EV charging equipment and services, enabling EV drivers to recharge at various location types. Blink’s principal line of products and services is its nationwide Blink EV charging networks (the “Blink Networks”) and Blink EV charging equipment, also known as electric vehicle supply equipment (“EVSE”), and other EV-related services. The Blink Networks is a proprietary, cloud-based system that operates, maintains and manages Blink charging stations and handles the associated charging data, back-end operations and payment processing. The Blink Networks provide property owners, managers, parking companies, state and municipal entities, and other types of commercial customers (“Property Partners”) with cloud-based services that enable the remote monitoring and management of EV charging stations. The Blink Networks also provide EV drivers with vital station information, including station location, availability and fees. Blink also operates an EV based ride-sharing business through its wholly-owned subsidiary, Envoy Mobility, Inc. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and disclosures required by U.S. GAAP for complete financial statements. In the opinion of management, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair presentation of the condensed consolidated financial statements of the Company as of June 30, 2024 and for the three and six months then ended. The results of operations for the three and six months ended June 30, 2024 are not necessarily indicative of the operating results for the full year ending December 31, 2024 or any other period. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related disclosures of the Company as of December 31, 2023 and for the year then ended, which were filed with the Securities and Exchange Commission (“SEC”) on March 18, 2024 as part of the Company’s Annual Report on Form 10-K (the “Annual Report”). 8 BLINK CHARGING CO. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (in thousands except for share and per share amounts) 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Since the Annual Report for the year ended December 31, 2023, there have been no material changes to the Company’s significant accounting policies, except as disclosed in this note. LIQUIDITY As of June 30, 2024, the Company had cash and cash equivalents of $ 73,885 and working capital of $ 111,801 . During the three and six months ended June 30, 2024, the Company incurred a net loss of $ 20,059 and $ 37,232 , respectively. During the six months ended June 30, 2024, the Company used cash in operating activities of $ 25,735 . During the six months ended June 30, 2024, the Company sold an aggregate of 8,177,472 shares of common stock under an “at-the-market” equity offering program for aggregate gross proceeds of $ 25,651 , less issuance costs of $ 581 . See Note 10 – Stockholders’ Equity. The Company has not yet achieved profitability and expects to continue to incur cash outflows from operations. Historically, the Company has been able to raise funds to support its business operations, although there can be no assurance that it will be successful in raising significant additional funds in the future. The Company expects that its cash on hand will fund its operations for at least 12 months after the issuance date of these financial statements. Since inception, the Company’s operations have primarily been funded through proceeds received in equity and debt financing. The Company believes it has access to capital resources and continues to evaluate additional financing opportunities. There is no assurance that the Company will be able to obtain funds on commercially acceptable terms, if at all. There is also no assurance that the amount of funds the Company might raise will enable the Company to complete its development initiatives or attain profitable operations. The Company’s operating needs include the planned costs to operate its business, including amounts required to fund working capital and capital expenditures. The Company’s future capital requirements and the adequacy of its available funds will depend on many factors, including the Company’s ability to successfully commercialize its products and services, competing technological and market developments, and the need to enter into collaborations with other companies or acquire other companies or technologies to enhance or complement its product and service offerings. The Company is executing its plan designed to improve the Company’s liquidity by enhancing revenue economics, increasing gross profit through product optimization, integration of acquisitions and reduction of operating expenses through cost avoidance and cost cutting strategies. There can be no assurances that these strategies will be achieved. INVENTORY As of June 30, 2024, the Company’s inventory was comprised $ 31,932 of finished goods that were available for sale and $ 12,522 of raw material and work in process. As of December 31, 2023, the Company’s inventory was comprised of $ 33,902 of finished goods that were available for sale and $ 14,040 of raw material and work in process. FOREIGN CURRENCY TRANSLATION Transaction (losses) gains attributable to foreign exchange were $ ( 15 ) and $ ( 45 ) during the three and six months ended June 30, 2024, respectively. Transaction (losses) gains attributable to foreign exchange were $ ( 1,026 ) and $ 781 during the three and six months ended June 30, 2023, respectively. Transaction gains and losses attributable to foreign exchange are included within general and administrative expenses on the condensed consolidated statements of operations for the three and six months ended June 30, 2024 and 2023. ASSETS HELD FOR SALE The Company initially measures an asset that is classified as held for sale at the lower of its carrying amount or fair value less costs to sell. The Company assesses the fair value of an asset less costs to sell each reporting period that it remains classified as held for sale, and reports any subsequent changes as an adjustment to the carrying amount of the asset. Assets are not depreciated or amortized while they are classified as held for sale. Office Space During the first quarter of 2024, the Company commenced plans to sell its approximately 10,000 square feet of office space in Miami Beach, Florida. The asset is included within property and equipment on the condensed consolidated balance sheet as of June 30, 2024. The asset’s carrying value was $ 3,675 and $ 3,692 as of June 30, 2024, and December 31, 2023, respectively. Underperforming Subsidiary During the first quarter of 2024, the Company’s Board of Directors approved a plan to sell a subsidiary’s underperforming assets. On April 30, 2024, the Company entered into an agreement to sell the subsidiary’s installed and inventory charging units and the associated agreements with existing customers, hosts, and drivers. This transaction was completed and funded on July 3, 2024. As a result, the Company recorded an estimated loss of $ 119 and $ 683 for the three and six months ended June 30, 2024, respectively, which is included in operating expenses on the accompanying condensed consolidated statements of operations. The Company elected not to present this underperforming subsidiary as discontinued operations because it is immaterial to the Company’s condensed consolidated financial statements. 9 BLINK CHARGING CO. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (in thousands except for share and per share amounts) 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED REVENUE RECOGNITION The Company recognizes revenue primarily from the following: ● Product sales – Revenue is recognized at the point where the customer obtains control of the goods and the Company satisfies its performance obligation, which generally is at the time it ships the product to the customer. ● Charging service revenue – company-owned charging stations - Revenue is recognized at the point when a particular charging session is completed. ● Network fees and warranty – Represents a stand-ready obligation whereby the Company is obligated to perform over a period of time and, as a result, revenue is recognized on a straight-line basis over the contract term. Network fees are billed annually. ● Car-sharing services – Relates to revenues attributable to a car-sharing services which provides customers the ability to rent electric vehicles through a subscription service. ● Grant and rebate – Relates to EV charging stations and their installation are deferred and amortized in a manner consistent with the related depreciation expense of the related asset over their useful lives over the useful life of the charging station. ● Other – Other revenues are primarily comprised of revenues generated from alternative fuel credits. The following table summarizes revenue recognized in the condensed consolidated statements of operations: SCHEDULE OF REVENUE RECOGNITION BY CONTRACT 2024 2023 2024 2023 For The Three Months Ended For The Six Months Ended June 30, June 30, 2024 2023 2024 2023 Revenues - Recognized at a Point in Time Product sales $ 23,582 $ 24,587 $ 51,090 $ 40,976 Charging service revenue - company-owned charging stations 4,936 4,367 9,963 7,252 Other 243 155 578 227 Total Revenues - Recognized at a Point in Time 28,761 29,109 61,631 48,455 Revenues - Recognized Over a Period of Time: Network fees 1,907 1,667 3,972 3,295 Warranty 1,340 921 2,293 1,314 Total Revenues - Recognized Over a Period of Time 3,247 2,588 6,265 4,609 Revenues- Other Car-sharing services 1,202 957 2,299 1,209 Grant and rebate 52 188 635 237 Total Revenues - Other 1,254 1,145 2,934 1,446 Total Revenue $ 33,262 $ 32,842 $ 70,830 $ 54,510 The following table summarizes our revenue recognized in the condensed consolidated statements of operations by geographical area: SCHEDULE OF REVENUE RECOGNITION BY GEOGRAPHICAL AREA 2024 2023 2024 2023 For The Three Months Ended For The Six Months Ended June 30, June 30, 2024 2023 2024 2023 Revenues by Geographical Area U.S.A $ 24,127 $ 24,435 $ 51,820 $ 37,610 International 9,135 8,407 19,010 16,900 Total Revenue $ 33,262 $ 32,842 $ 70,830 $ 54,510 The timing of the Company’s revenue recognition may differ from the timing of payment by its customers. A receivable is recorded when revenue is recognized prior to payment and the Company has an unconditional right to payment. Alternatively, when payment precedes the provision of the related services, the Company records deferred revenue until the performance obligations are satisfied. As of June 30, 2024, the Company had $ 28,707 related to contract liabilities where performance obligations have not yet been satisfied, which has been included within deferred revenue on the condensed consolidated balance sheets as of June 30, 2024. The Company expects to satisfy $ 15,192 of its remaining performance obligations for network fees, warranty revenue, product sales, and other and recognize the revenue within the next twelve months. The Company has elected to apply the practical expedient to expense costs to obtain contracts at the time the liability is incurred when the expected amortization period is one year or less. During the three and six months ended June 30, 2024, the Company recognized $ 2,624 and $ 5,072 of revenues, respectively, related to network fees and warranty contracts, which were included in deferred revenues as of December 31, 2023. During the three and six months ended June 30, 2024, there was no revenue recognized from performance obligations satisfied (or partially satisfied) in previous periods as specified by ASC 606-10-50-12A. 10 BLINK CHARGING CO. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (in thousands except for share and per share amounts) 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED REVENUE RECOGNITION – CONTINUED Grants, rebates and alternative fuel credits, which are not within the scope of ASC 606, pertaining to revenues and periodic expenses are recognized as income when the related revenue and/or periodic expense are recorded. Grants and rebates related to EV charging stations and their installation are deferred and amortized in a manner consistent with the related depreciation expense of the related asset over their useful lives over the useful life of the charging station. During the three months ended June 30, 2024 and 2023, the Company recorded $ 52 and $ 188 , respectively, related to grant and rebate revenue. During the six months ended June 30, 2024 and 2023, the Company recorded $ 635 and $ 237 , respectively, related to grant and rebate revenue. During the three months ended June 30, 2024 and 2023, the Company recognized $ 31 and $ 52 respectively, of revenue related to alternative fuel credits. During the six months ended June 30, 2024 and 2023, the Company recognized $ 75 and $ 103 , respectively, of revenue related to alternative fuel credits. Car-sharing services is accounted for under ASC Topic 842, Leases, and pertains to revenues and expenses related to a car-sharing services agreement with the City of Los Angeles which allows customers the ability to rent electric vehicles through a subscription service. The Company accounts for such rentals as operating leases. The lease terms are included in the Company’s contracts, and the determination of whether the Company’s contracts contain leases generally does not require significant assumptions or judgments. The Company’s lease revenues do not include material amounts of variable payments. The Company does not provide an option for the lessee to purchase the rented equipment at the end of the lease. The Company is unsure of when the customer will return rented equipment. As such, the Company does not know how much the customer will owe it upon return of the equipment and, therefore, cannot provide a maturity analysis of future lease payments. The Company’s equipment is generally rented for short periods of time (generally a few minutes to a few hours). Lessees do not provide residual value guarantees on rented equipment. The Company expects to derive significant future benefits from its equipment following the end of the rental term. The Company’s equipment is typically rented for the majority of the time that the Company owns it. The Company recognizes revenue over the contractual period of performance of the subscription which are short term in nature. During the three months ended June 30, 2024 and 2023, the Company recognized $ 1,202 and $ 957 , respectively, related to car-sharing services revenue. During the six months ended June 30, 2024 and 2023, the Company recognized $ 2,299 and $ 1,209 , respectively, related to car-sharing services revenue. CONCENTRATIONS During the three months ended June 30, 2024 and 2023, sales to a significant customer represented 16 % and less than 10% of total revenue, respectively. During the three months ended June 30, 2024 and 2023, sales to another significant customer represented 12 % and 0 % of total revenue, respectively. During the three months ended June 30, 2024 and 2023, the Company made purchases from a significant supplier that represented 21 % and 14 % of total purchases, respectively. During the six months ended June 30, 2024 and 2023, the Company made purchases from a significant supplier that represented 18 % and 13 % of total purchases, respectively. As of June 30, 2024, accounts receivable from a significant customer represented 10 % of total accounts receivable. As of June 30, 2024, accounts payable to two significant vendors represented 19 % and 12 % of total accounts payable. As of December 31, 2023, accounts payable to two significant vendors were approximately 16 % and 10 % of total accounts payable. RECLASSIFICATIONS Certain prior year balances have been reclassified to conform to the current year presentation. These reclassifications have no effect on previously reported results of operations or loss per share. NET LOSS PER COMMON SHARE Basic net loss per common share is computed by dividing net loss attributable to common shareholders by the weighted average number of common shares outstanding during the period. Diluted net loss per common share is computed by dividing net loss attributable to common shareholders by the weighted average number of common shares outstanding, plus the number of additional common shares that would have been outstanding if the common share equivalents had been issued (computed using the treasury stock or if converted method), if dilutive. The following common share equivalents are excluded from the calculation of weighted average common shares outstanding because their inclusion would have been anti-dilutive: SCHEDULE OF OUTSTANDING DILUTED SHARES EXCLUDED FROM DILUTED LOSS PER SHARE COMPUTATION 2024 2023 For the Three and Six Months Ended June 30, 2024 2023 Warrants 1,150,152 1,150,152 Options 908,162 946,685 Total potentially dilutive shares 2,058,314 2,096,837 11 BLINK CHARGING CO. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (in thousands except for share and per share amounts) 3. NOTES PAYABLE SEMACONNECT - NOTES PAYABLE During the six months ended June 30, 2024, the Company repaid the remaining principal balance of $ 31,354 due under its SemaConnect acquisition promissory note, together with an additional $ 1,139 of accrued interest. ENVOY - NOTES PAYABLE During the six months ended June 30, 2024, the Company repaid the remaining principal balance of $ 6,527 due under this note as well as paid $ 297 of accrued interest . 4. STOCKHOLDERS’ EQUITY AT-THE-MARKET OFFERING During the six months ended June 30, 2024, the Company sold an aggregate of 8,177,472 shares of common stock aggregate gross proceeds of $ 25,651 , less issuance costs of $ 581 , for net proceeds of $ 25,070 . COMMON STOCK During the six months ended June 30, 2024, the Company issued an aggregate of 837 shares of common stock for services to an employee with an issuance date fair value of $ 2 and will be recognized ratably over the vesting term. On the grant date 279 shares vested immediately, 279 shares vested on April 1, 2024, and the remaining 279 shares will vest on April 1, 2025. Expenses related to this award are included within compensation expense on the condensed consolidated statements of operations. During the six months ended June 30, 2024, the Company issued an aggregate of 70,665 shares of common stock upon vesting of restricted stock units to employees for services with an aggregate grant date fair value of $ 825 . Expenses related to this award were included within compensation expense on the condensed consolidated statements of operations. STOCK-BASED COMPENSATION The Company recognized stock-based compensation expense related to common stock, stock options and warrants for the three months and six months ended June 30, 2024, $ 1,033 and $ 1,950 respectively, which is included within compensation expense on the condensed consolidated statements of operations. The Company recognized stock-based compensation expense related to common stock, stock options and warrants for the three and six months ended June 30, 2023 of $ 7,775 and $ 19,439 , respectively, which is included within compensation expense on the condensed consolidated statements of operations. As of June 30, 2024, there was $ 3,542 of unrecognized stock-based compensation expense that will be recognized over the weighted average remaining vesting period of 1.2 years. During the six months ended June 30, 2024, the Company granted an aggregate of 758,549 shares of restricted stock with an aggregate grant date fair value of $ 2,133 which will be recognized ratably over the vesting terms. The restricted stock has vesting dates ranging from April 15, 2024 to June 30, 2027 . Expenses related to this award are included within compensation expense on the condensed consolidated statements of operations. 12 BLINK CHARGING CO. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (in thousands except for share and per share amounts) 5. RELATED PARTY TRANSACTIONS JOINT VENTURE The Company and a group of three Cyprus entities entered into a shareholders’ agreement on February 11, 2019, pertaining to the parties’ respective shareholdings in a new joint venture entity, Blink Charging Europe Ltd. (the “Entity”), that was formed under the laws of Cyprus on the same date. The Company owns 40 % of the Entity, while the other three parties own 60 % . Subsequently, two of the three other parties exited the joint venture, and the remaining other party acquired the ownership of the exiting parties. The Entity currently owns 100 % of a Greek subsidiary, Blink Charging Hellas SA (“Hellas”), which operates in the electric vehicle market in Greece. The obligation to fund the Entity’s future operations is limited to the Company’s 40 % ownership. During the three and six months ended June 30, 2024, the Company recognized sales of $ 182 to Hellas. No sales to Hellas were recognized during the three and six months ended June 30, 2023. In addition, the Company had accounts receivable of $ 183 and $ 0 as of June 30, 2024, and December 31, 2023. In addition, as of June 30, 2024, and December 31, 2023, the Company had a payable of approximately $ 164 and $ 114 , respectively, to Hellas. Furthermore, the Company has provided working capital of $ 148 and $ 0 for the six months ended June 30, 2024 and 2023, respectively, to Hellas. The Company has written off this working capital contribution, since the Company’s proportion of Hellas’s net losses exceeds the working capital contribution. The Company determined that the Entity is a variable interest entity; however, the Company does not have a controlling financial interest and, as a result, the Company is not required to consolidate the Entity and instead has applied equity method accounting to its investment in the Entity. From inception through June 30, 2024, the Entity has not generated net income and, as a result, pursuant to ASC 323, the Company has not recorded a gain or loss on its equity method investment in the Entity during the three and six months ended June 30, 2024 and 2023. BLINK CHARGING UK LIMITED As of June 30, 2024, several close family members of a senior management employee are providing services to Blink Charging UK Limited. For the three and six months ended June 30, 2024, these related parties collectively provided services worth $ 35 and $ 117 , respectively, to Blink Charging UK Limited. For the three and six months ended June 30, 2023, these related parties have collectively provided services worth $ 39 and $ 125 , respectively, to Blink Charging UK Limited. These expenses are included within general and administrative expenses on the condensed consolidated statements of operations for the three and six months ended June 30, 2024 and 2023. 13 BLINK CHARGING CO. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (in thousands except for share and per share amounts) 6. LEASES OPERATING LEASES Total operating lease expenses for the three and six months ended June 30, 2024 were $ 347 and $ 1,135 , respectively, and for the three and six months ended June 30, 2023 were $ 655 and $ 1,149 , respectively, which were recorded in other operating expenses on the condensed consolidated statements of operations. Operating lease expenses consist of rent expense, common area maintenance adjustments and other expenses. As of June 30, 2024, the Company did not have additional operating and financing leases that have not yet commenced. As of June 30, 2024, the Company had $ 168 of right-of-use assets that were classified as financing leases for vehicles associated with the operations of Blink Mobility and are included as a component of property and equipment on the condensed consolidated balance sheet as of June 30, 2024. As of December 31, 2023, the Company had $ 697 of right-of-use assets that were classified as financing leases for vehicles associated with Blink Mobility’s operations and are included as a property and equipment component on the consolidated balance sheet as of December 31, 2023. During the three and six months ended June 30, 2024, the Company recorded $ 13 and $ 23 , respectively, of interest expense related to finance leases, which were recorded within interest expense on the condensed consolidated statements of operations. During the three and six months ended June 30, 2023, the Company recorded $ 106 and $ 116 , respectively, of interest expense related to finance leases. During the three and six months ended June 30, 2024 the Company recorded amortization expense of $ 489 and $ 536 respectively, related to finance leases. During the three and six months ended June 30, 2023, the Company recorded amortization expense of $ 353 and $ 522 related to finance leases. These expenses were included within depreciation and amortization expense on the condensed consolidated statements of operations for the three and six months June 30, 2024 and 2023. Supplemental cash flows information related to leases was as follows: SCHEDULE OF SUPPLEMENTAL CASH FLOWS INFORMATION RELATED TO LEASES For The Six Months Ended June 30, 2024 2023 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 2,052 $ 2,232 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases 2,052 2,232 Financing cash flows from finance leases $ 375 $ 1,443 Cash paid for amounts included in the measurement of lease liabilities: Financing cash flows from finance leases 375 1,443 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 653 $ 4,765 Right-of-use assets obtained in exchange for lease obligations: Operating leases 653 4,765 Finance leases $ 53 $ 2,798 Right-of-use assets obtained in exchange for lease obligations: Finance leases 53 2,798 Weighted Average Remaining Lease Term Operating leases 2.65 3.21 Financing leases 2.78 1.99 Weighted Average Discount Rate Operating leases 7.2 % 7.1 % Finance leases 6.3 % 6.7 % Future minimum payments under non-cancellable leases as of June 30, 2024 were as follows: SCHEDULE OF FUTURE MINIMUM LEASE PAYMENTS For the Years Ending December 31, Operating Lease Finance Lease 2024 $ 4,399 $ 393 2025 2,979 41 2026 1,673 41 2027 1,042 34 2028 742 10 Thereafter 1,014 - Total future minimum lease payments 11,849 519 Less: imputed interest ( 2,545 ) ( 166 ) Total $ 9,304 $ 353 14 BLINK CHARGING CO. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (in thousands except for share and per share amounts) 7. FAIR VALUE MEASUREMENT Assumptions utilized in the valuation of Level 3 liabilities are described as follows: SUMMARY OF ASSUMPTIONS USED FOR VALUATION OF FAIR VALUE LIABILITIES For the Three Months Ended For the Six Months Ended June 30, June 30, 2024 2023 2024 2023 Risk-free interest rate 5.09 % 5.40 % 5.03 %- 5.09 % 4.64 %- 5.40 % Contractual term (years) 1.00 1.00 1.00 1.00 Expected volatility 90 % 71 % 88 %- 90 % 71 %- 77 % Expected dividend yield 0.00 % 0.00 % 0.00 % 0.00 % The following table sets forth a summary of the changes in the fair value of Level 3 warrant and consideration payable liabilities that are measured at fair value on a recurring basis: SUMMARY OF CHANGES IN FAIR VALUE OF LEVEL 3 WARRANT LIABILITIES MEASURED AT RECURRING BASIS 2024 Consideration payable Beginning balance as of January 1, $ 18,118 Change in fair value of consideration payable 2,447 Ending balance as of June 30, $ 20,565 Warrant Liability Beginning balance as of January 1 $ 32 Change in fair value of warrant liability ( 23 ) Ending balance as of June 30, $ 9 The common stock consideration payable is recorded at fair value of $ 20,565 and $ 18,118 as of June 30, 2024 and December 31, 2023, respectively, and is included within consideration payable on the condensed consolidated balance sheets. The Company uses a probability-weighted discounted cash flow approach as a valuation technique to determine the fair value of the common stock consideration payable on the acquisition date and at each reporting period. The significant unobservable inputs used in the fair value measurements are the probability outcome percentages that are assigned to each scenario. Significant increases or decreases to either of these inputs in isolation could result in a significantly higher or lower liability with a higher liability capped by the contractual maximum of the common stock consideration liability. Assets and liabilities measured at fair value on a recurring basis are as follows: SUMMARY OF ASSETS AND LIABILITIES MEASURED AT FAIR VALUE RECURRING AND NONRECURRING BASIS June 30, 2024 Level 1 Level 2 Level 3 Total Assets: Alternative fuel credits $ - $ 15 $ - $ 15 Total assets $ - $ 15 $ - $ 15 Liabilities: Warrant liability $ - $ - $ 9 $ 9 Common stock consideration payable - - 20,565 20,565 Total liabilities $ - $ - $ 20,574 $ 20,574 December 31, 2023 Level 1 Level 2 Level 3 Total Assets: Alternative fuel credits $ - $ 32 $ - $ 32 Total assets $ - $ 32 $ - $ 32 Liabilities: Option liability $ 293 $ - $ - $ 293 Warrant liability - - 32 32 Common stock liability 743 - - 743 Common stock consideration payable - - 18,118 18,118 Total liabilities $ 1,036 $ - $ 18,150 $ 19,186 15 BLINK CHARGING CO. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (in thousands except for share and per share amounts) 8. COMMITMENTS AND CONTINGENCIES LITIGATION, DISPUTES AND SETTLEMENTS The Company may be subject to lawsuits, investigations, intellectual property matters, claims and proceedings, including, but not limited to, contractual disputes with vendors and customers and liabilities related to employment, health and safety matters that may arise in the ordinary course of business. The Company accrues for losses that are both probable and reasonably estimable. Loss contingencies are subject to significant uncertainties and, therefore, determining the likelihood of a loss and/or the measurement of any loss can be complex and subject to change. The Company believes it has recorded adequate provisions for any such lawsuits, investigations, claims, and proceedings as of June 30, 2024, and the Company believes it was not reasonably possible that a material loss had been incurred in excess of the amounts recognized in the condensed consolidated financial statements. Given the inherent uncertainties of litigation, the ultimate outcome of the ongoing matters described herein cannot be predicted with certainty. While litigation is inherently unpredictable, the Company believes it has valid defenses with respect to the legal matters pending against it. However, future events or circumstances, currently unknown to management, may potentially have a material effect on the Company’s financial position, liquidity or results of operations in any future reporting period. In August 2020, a purported securities class action lawsuit, captioned Bush v. Blink Charging Co. et al., Case No. 20-cv-23527, was filed in the United States District Court for the Southern District of Florida against the Company, Michael Farkas (Blink’s former Chairman of the Board and Chief Executive Officer), and Michael Rama (Blink’s Chief Financial Officer) (the “Bush Lawsuit”). In September 2020, another purported securities class action lawsuit, captioned Vittoria v. Blink Charging Co. et al., Case No. 20-cv-23643, was filed in the United States District Court for the Southern District of Florida against the same defendants and seeking to recover the same alleged damages. Following consolidation of the two actions and the court appointing Tianyou Wu, Alexander Yu and H. Marc Joseph to serve as the Co-Lead Plaintiffs, the Co-Lead Plaintiffs filed an Amended Complaint in February 2021. The Amended Complaint alleged, among other things, that the defendants made false or misleading statements about the size and functionality of the Blink Network and asserted claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. In April 2021, Blink and the other defendants filed a motion to dismiss the Amended Complaint. In November 2023, the court dismissed Co-Lead Plaintiffs’ claims relating to the size of Blink’s charging network and denied the remainder of the motion to dismiss. Following a mediation in April 2024, the parties agreed to the terms of a settlement, which is subject to final court approval. As part of the settlement, the Defendants agreed to pay $ 3,750 (inclusive of attorneys’ fees and administrative costs) in exchange for the dismissal with prejudice of all claims. On July 2, 2024, Co-Lead Plaintiffs filed an unopposed motion for preliminary approval of the settlement. On July 9, 2024, the court (i) granted the motion, (ii) certified a settlement class, for settlement purposes only, of investors who purchased or otherwise acquired Blink’s common stock between March 6, 2020 and August 19, 2020, (iii) preliminarily approved the settlement, and (iv) set a final settlement hearing for October 23, 2024. The full settlement amount has been paid by the Company’s Directors’ and Officers’ insurance policies. In September 2020, a shareholder derivative lawsuit, captioned Klein (derivatively on behalf of Blink Charging Co.) v. Farkas et al., Case No. 20- 19815CA01, was filed in Miami-Dade County Circuit Court seeking to pursue claims belonging to the Company against Blink’s Board of Directors and Michael Rama (the “Klein Lawsuit”). Blink is named as a nominal defendant. The Klein Lawsuit asserted that the Director defendants caused Blink to make the statements at issue in the securities class action and, as a result, the Company incurred costs defending against the Bush Lawsuit and other unidentified investigations. The Klein Lawsuit asserted claims against the Director defendants for breach of fiduciary duties and corporate waste and against all of the defendants for unjust enrichment. Klein did not quantify the alleged damages in his complaint, but he sought damages sustained by the Company as a result of the defendants’ alleged breaches of fiduciary duties, corporate governance changes, restitution, and disgorgement of profits from the defendants and attorneys’ fees and other litigation expenses. In December 2020, another shareholder derivative action, captioned Bhatia (derivatively on behalf of Blink Charging Co.) v. Farkas et al., Case No. 20-27632CA01, was filed in Miami-Dade County Circuit Court against the same defendants in the Klein Lawsuit and asserted similar claims, as well as additional claims relating to the Company’s nomination, appointment and hiring of minorities and women and the Company’s decision to retain its outside auditor (the “Bhatia Lawsuit”). In June 2022, the court consolidated the Klein and Bhatia actions under the caption In re Blink Charging Company Stockholder Derivative Litigation, Lead Case No. 2020-019815-CA-01. The action remains stayed pending the final approval of the settlement in the Bush Lawsuit. The Company wholly and completely disputes the allegations. The Company has retained legal counsel to defend the action vigorously. The Company has not recorded an accrual related to this matter as of June 30, 2024, as it determined that any such loss contingency was either not probable or estimable. In February 2022, a shareholder derivative lawsuit, captioned McCauley (derivatively on behalf of Blink Charging Co.) v. Farkas et al., Case No. A-22-847894-C, was filed in Clark County, Nevada seeking to pursue claims belonging to the Company against Blink’s Board of Directors and Michael Rama (the “McCauley Lawsuit”). Blink is named as a nominal defendant. The McCauley Lawsuit asserted similar claims and sought similar damages as the Klein Lawsuit. The action remains stayed pending the final approval of the settlement in the Bush Lawsuit. The Company wholly and completely disputes the allegations. The Company has retained legal counsel to defend the action vigorously. The Company has not recorded an accrual related to this matter as of June 30, 2024, as it determined that any such loss contingency was either not probable or estimable. REPAIRS AND MAINTENANCE- COMPANY OWNED CHARGERS The Company estimates an approximate cost of $ 106 and $ 600 to repair deployed chargers, which the Company owned as of June 30, 2024 and December 31, 2023, respectively. 16