What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2025-08-14 compared with 2025-05-20 · 741 added, 739 removed, 603 unchanged (71% of the section changed)

1 unchanged sentence

DARKPULSE, INC.

Consolidated Balance

Consolidated Balance Sheets

CURRENT ASSETS:

35 unchanged sentences

Series A Super Voting preferred stock - par value $ 0.01 ;

shares designated, 100

shares issued and outstanding at both March 31, 2025, 2024 and December 31, 2024

100 shares designated, 100 shares issued and outstanding at both June 30, 2025 and December 31, 2024

Convertible preferred stock - Series D, par value $ 0.01 , 100,000

shares designated, 88,235

shares issued and outstanding as of both March 31, 2025 and December 31, 2024

Common stock, par value $ 0.0001 , 20,000,000,000

shares authorized, 12,186,976,200

and 10,551,957,534

shares issued as of March 31, 2025 and December 31, 2024, respectively,

Treasury stock at cost, 100,000

shares at March 31, 2025 and December 31, 2024

shares issued and outstanding as of both June 30, 2025 and December 31, 2024

Common stock, par value $ 0.0001 , 20,000,000,000 shares authorized, 14,666,648,287 and 10,551,957,534 shares issued as of June 30, 2025 and December 31, 2024, respectively,

Treasury stock at cost, 100,000 shares at June 30, 2025 and December 31, 2024

Additional paid-in capital

11 unchanged sentences

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT

the accompanying notes to the unaudited condensed consolidated financial statements

DARKPULSE, INC.

CONDENSED CONSOLIDATED

STATEMENT OF OPERATIONS

See the accompanying notes to the unaudited condensed

consolidated financial statement

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Ended

Six Months Ended

COST OF REVENUES

3 unchanged sentences

Salaries, wages and payroll taxes

Bad debt expense

Professional fees

Depreciation and amortization

Bad debt expense

Impairment expense

Gain on forgiveness of payables

TOTAL OPERATING EXPENSES

OPERATING LOSS

( 1,004,325 )

OTHER INCOME (EXPENSE):

3 unchanged sentences

Loss on equity investment

( 1,500,000 )

Gain on the forgiveness of debt

1 unchanged sentence

Foreign currency exchange rate variance

Gain/(Loss) on Disposal of Asset

TOTAL OTHER INCOME (EXPENSE)

Net loss from continuing operations

Loss from discontinued operations, net of tax

Net income (loss)

( 1,947,377 )

( 1,948,779 )

( 2,416,706 )

( 1,033,417 )

( 2,953,104 )

Net loss attributable to non-controlling interests

2 unchanged sentences

$ ( 2,410,261 )

$ ( 1,025,668 )

$ ( 2,943,650 )

Net loss per share - basic and diluted

2 unchanged sentences

8,191,535,359

12,386,327,893

8,213,651,977

Three Months Ended

Six Months Ended

$ ( 763,073 )

$ ( 2,416,706 )

$ ( 1,033,417 )

$ ( 2,953,104 )

OTHER COMPREHENSIVE INCOME (LOSS)

3 unchanged sentences

$ ( 2,416,705 )

the accompanying notes to the unaudited condensed consolidated financial statements

$ ( 1,033,416 )

$ ( 2,953,103 )

See the accompanying notes to the unaudited condensed

consolidated financial statements

DARKPULSE, INC.

Consolidated Statement

of Stockholders' Deficit

For the Three Months

Ended March 31, 2025 and 2024

Consolidated Statement of Stockholders' Deficit

For the Three Months Ended June 30, 2025 and

Preferred Stock

stock to be issued

Common stock to be issued

Balance at December 31, 2023

6 unchanged sentences

8,152,280,717

Common stock issued for cash, net of fees

Issuance of common stock for legal settlement

Common Stock to be issued

Foreign currency adjustment

Balance at June 30, 2024

8,928,508,901

Preferred Stock

Common stock to be issued

Balance at December 31, 2024

14 unchanged sentences

2,175,555,556

Common stock issued for cash, net of fees

1,729,672,017

Conversion of convertible debt into common stock

Issuance of common stock for legal settlement

( 750,000,000 )

Common Stock to be issued

Foreign currency adjustment

Net Income (loss)

Balance at June 30, 2025

14,666,648,217

1,425,555,556

the accompanying notes to the unaudited condensed consolidated financial statements

DARKPULSE, INC.

Consolidated Statement

of Stockholders' Deficit

For the Three Months

Ended March 31, 2025 and 2024

Consolidated Statement of Stockholders'

Deficit (Continued)

For the Three Months Ended June 30, 2025 and

Treasury stock

11 unchanged sentences

Foreign currency adjustment

Common stock issued for cash

Balance at March 31, 2024

2 unchanged sentences

$ ( 17,071,135 )

Common stock issued for cash, net of fees

Issuance of common stock for legal settlement

Common Stock to be issued

Foreign currency adjustment

( 2,410,261 )

( 2,416,706 )

Balance at June 30, 2024

$ ( 1,253,356 )

$ ( 70,319,872 )

$ ( 19,156,320380 )

Treasury stock

18 unchanged sentences

$ ( 17,223,485 )

the accompanying notes to the unaudited condensed consolidated financial statements

Common stock issued for cash, net of fees

Conversion of convertible debt into common stock

Issuance of common stock for legal settlement

Common Stock to be issued

Foreign currency adjustment

Net Income (loss)

Balance at June 30, 2025

$ ( 2,675,328 )

$ ( 72,285,347 )

$ ( 18,241,451 )

See the accompanying

notes to the unaudited condensed consolidated financial statements

DARKPULSE, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

Three Months Ended

CONSOLIDATED STATEMENT OF CASH FLOWS UNAUDITED

Six Months Ended June 30,

Cash flows from operating activities:

5 unchanged sentences

Change in fair market of derivative liabilities

Impairment of goodwill and intangible assets

Loss on equity investment

1 unchanged sentence

Amortization of debt discount

Impairment of goodwill and intangible assets

Bad debt expense

11 unchanged sentences

Other liabilities

Net cash provided (used) in operating activities

Net cash provided by (used in) operating

Cash flows from investing activities:

Purchases of property and equipment

Investment in related party

Investment in joint venture

1 unchanged sentence

Advances to related party

Net cash provided (used) in investing activities

Net cash provided by (used in) investing

Cash flows from financing activities:

2 unchanged sentences

Net repayments of loan payable

Net cash provided (used) by financing activities

Net cash provided by (used in) financing

Net change in cash

Effect of exchange rate on cash

( 1,048,242 )

Cash at beginning of year

5 unchanged sentences

Conversion of convertible debt

the accompanying notes to the unaudited condensed consolidated financial statements

See the accompanying notes to the unaudited condensed

consolidated financial statements

DARKPULSE, INC.

TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 – BASIS OF FINANCIAL STATEMENT PRESENTATION

NOTES TO THE CONDENSED CONSOLIDATED

FINANCIAL STATEMENTS UNAUDITED

NOTE 1 – BASIS OF FINANCIAL

STATEMENT PRESENTATION

Organization and Description of Business

DarkPulse, Inc.

(“DPI” or “Company”)

is a technology-security company incorporated in 1989 as Klever Marketing, Inc.

Its’ wholly- owned subsidiary,

DarkPulse Technologies Inc.

(“DPTI”), originally started as a technology spinout from the University of New Brunswick, Fredericton,

The Company’s security and monitoring systems will initially be delivered in applications for border security, pipelines,

the oil and gas industry and mine safety.

Current uses of fiber optic distributed sensor technology have been limited to quasi-static,

long-term structural health monitoring due to the time required to obtain the data and its poor precision.

The Company’s patented

BOTDA dark-pulse sensor technology allows for the monitoring of highly dynamic environments due to its greater resolution and accuracy.

The Company’s subsidiaries consist of:

Inc., based in New York;

“Company”) is a technology-security company incorporated in 1989 as Klever Marketing, Inc.

wholly- owned subsidiary, DarkPulse Technologies Inc.

(“DPTI”), originally started as a technology spinout from the University

of New Brunswick, Fredericton, Canada.

The Company’s security and monitoring systems will initially be delivered in applications

for border security, pipelines, the oil and gas industry and mine safety.

Current uses of fiber optic distributed sensor technology have

been limited to quasi-static, long-term structural health monitoring due to the time required to obtain the data and its poor precision.

The Company’s patented BOTDA dark-pulse sensor technology allows for the monitoring of highly dynamic environments due to its greater

resolution and accuracy.

The Company’s subsidiaries consist

Terradata Unmanned PLLC, based in Florida;

DarkPulse UK Ltd based in the United Kingdom, Optilan India Pvt Ltd

based in Navi-Mumbai and Optilan Communications & Security Systems Ltd, based in Ankara Turkey.

Optilan India Pvt Ltd, operating in India, provides

project engineering & design, system provisioning and contract bid services for the Company globally.

DarkPulse UK Ltd based in the United Kingdom;

Optilan India Pvt Ltd based in Navi-Mumbai;

Optilan Communications & Security Systems Ltd, based in Ankara Turkey;

and DarkPulse Technologies – FZCO based in Dubai, UAE.

Optilan India Pvt Ltd, operating in

India, provides project engineering & design, system provisioning and contract bid services for the Company globally.

Optilan Communications

& Security Systems Ltd, provides project engineering & design, system provisioning and contract bid services for the Company throughout

DarkPulse Manufacturing Inc., based in Arizona

(formerly TJM Electronics West, Inc.), is no longer providing products or services as a result of the Company’s relationship with

Sanmina Corporation who is handling both the design and manufacturing of the Company’s patented hardware.

Remote Intelligence, LLC and Wildlife Specialists,

LLC are no longer providing services as a result of redundant service offerings that are now being offered by TerraData Unmanned.

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES

A summary of the significant accounting policies

consistently applied in the preparation of the accompanying financial statements are as follows:

Basis of Presentation and Principles of Consolidation

The Company’s consolidated financial statements

are prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”).

The consolidated

financial statements of the Company include the Company and its wholly-owned subsidiaries.

All material intercompany balances and transactions

have been eliminated in consolidation.

The Company evaluates its relationships with other

entities to identify whether they are variable interest entities (“VIE”) as defined by Financial Accounting Standards Board

(“FASB”) Accounting Standards Codification (“ASC”) Topic 810, Consolidation (“ASC 810”), and

DarkPulse Technologies – FZCO will provide Science & Technology Consultancy, Building Maquette & Model Makers and

IT Infrastructure.

DarkPulse Manufacturing Inc., based

in Arizona (formerly TJM Electronics West, Inc.), is no longer providing products or services as a result of the Company’s relationship

with Sanmina Corporation who is handling both the design and manufacturing of the Company’s patented hardware.

Remote Intelligence, LLC and Wildlife

Specialists, LLC are no longer providing services as a result of redundant service offerings that are now being offered by TerraData Unmanned.

NOTE 2 – SIGNIFICANT ACCOUNTING

A summary of the significant accounting

policies consistently applied in the preparation of the accompanying financial statements are as follows:

Basis of Presentation and Principles of

Consolidation

The Company’s consolidated financial

statements are prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”).

consolidated financial statements of the Company include the Company and its wholly-owned subsidiaries.

All material intercompany balances

and transactions have been eliminated in consolidation.

The Company evaluates its relationships

with other entities to identify whether they are variable interest entities (“VIE”) as defined by Financial Accounting Standards

Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810, Consolidation (“ASC 810”), and

to assess whether it is the primary beneficiary of such entities.

2 unchanged sentences

Use of Estimates

The preparation of the Company’s financial

statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and

liabilities, the 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.

Significant estimates and assumptions reflected in these financial statements include,

but are not limited to, assumptions used to calculate derivative liabilities, revenue recognition and impairment of long-lived assets.

The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes

to be reasonable under the circumstances.

On an ongoing basis, management evaluates its estimates when there are changes in circumstances,

facts and experience.

The preparation of the Company’s

financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of

assets and liabilities, the 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.

Significant estimates and assumptions reflected in these financial statements

include, but are not limited to, assumptions used to calculate derivative liabilities, revenue recognition and impairment of long-lived

The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that

it believes to be reasonable under the circumstances.

On an ongoing basis, management evaluates its estimates when there are changes in

circumstances, facts and experience.

Changes in estimates are recorded in the period in which they become known.

Actual results could differ from those

The Company considers all highly liquid investments

with a maturity of three months or less when acquired to be cash equivalents.

The Company places its cash with high credit quality financial

institutions.

The Company’s account at this institution is insured by the Federal Deposit Insurance Corporation (“FDIC”)

up to $250,000.

To reduce its risk associated with the failure of such a financial institution, the Company evaluates at least annually

the rating of the financial institution in which it holds deposits.

Actual results could

differ from those estimates.

The Company considers all highly liquid

investments with a maturity of three months or less when acquired to be cash equivalents.

The Company places its cash with high credit

quality financial institutions.

The Company’s account at this institution is insured by the Federal Deposit Insurance Corporation

(“FDIC”) up to $250,000.

To reduce its risk associated with the failure of such a financial institution, the Company evaluates

at least annually the rating of the financial institution in which it holds deposits.

Accounts Receivable

Accounts receivable and contract assets include

amounts billed to customers under the terms and provisions of the contracts.

Most billings are determined based on contractual terms.

As is common practice in the industry, the Company classifies all accounts receivable and contract assets, including retainage, as current

The contracting cycle for certain long-term contracts may extend beyond one year, and accordingly, collection of retainage on

those contracts may extend beyond one year.

Accounts receivable and contract assets

include amounts billed to customers under the terms and provisions of the contracts.

Most billings are determined based on contractual

As is common practice in the industry, the Company classifies all accounts receivable and contract assets, including retainage,

as current assets.

The contracting cycle for certain long-term contracts may extend beyond one year, and accordingly, collection of retainage

on those contracts may extend beyond one year.

Contract assets include amounts billed to customers under retention provisions in construction

9 unchanged sentences

a material impact on the Company’s consolidated financial statements and related disclosures for the year ended December 31, 2024.

Each month, the Company reviews its receivables

on a customer-by-customer basis and evaluates whether an allowance for doubtful accounts is necessary based on any known or perceived

collection issues.

Any balances that are eventually deemed uncollectible are written off against the allowance after all means of collection

have been exhausted and the potential for recovery is considered remote.

As of December 31, 2024 and 2023, the Company determined that

the allowance for doubtful accounts was $ 5,457

and $ 0 , respectively.

The allowance pertaining to Optilan UK was derecognized upon the Optilan Liquidation.

Each month, the Company reviews its

receivables on a customer-by-customer basis and evaluates whether an allowance for doubtful accounts is necessary based on any known or

perceived collection issues.

Any balances that are eventually deemed uncollectible are written off against the allowance after all means

of collection have been exhausted and the potential for recovery is considered remote.

As of June 30, 2025 and 2024, the Company determined

that the allowance for doubtful accounts was $ 5,457 and $ 5,457 , respectively.

Foreign Currency Translation

The Company’s reporting currency is US Dollars.

The accounts of one of the Company’s subsidiaries is maintained using the appropriate local currency, British Pound (“GBP”)

as the functional currency, as well as the Turkish lira, Emiraes Dirham, Azerbajani Manat and Indian Rupee.

The accounts of one of the

Company’s subsidiaries is maintained using the appropriate local currency, Canadian Dollar (“CAD”) as the functional

The Company’s reporting currency

is US Dollars.

The accounts of one of the Company’s subsidiaries is maintained using the appropriate local currency, British Pound

(“GBP”) as the functional currency, as well as the Turkish lira, (“TL”), United Arab Emirates Dirham (“AED”),

and Indian Rupee (“INR”).

The accounts of one of the Company’s subsidiaries is maintained using the appropriate local

currency, Canadian Dollar (“CAD”) as the functional currency.

All assets and liabilities are translated into U.S.

Dollars at balance sheet date, shareholders' equity is translated at historical

rates and revenue and expense accounts are translated at the average exchange rate for the year or the reporting period.

The translation

adjustments are reported as a separate component of stockholders’ equity, captioned as accumulated other comprehensive (loss) gain.

Transaction gains and losses arising from exchange rate fluctuations on transactions denominated in a currency other than the functional

currency are included in the statements of operations as foreign currency exchange variance.

The relevant translation rates are as follows:

for the year ended March 31, 2025 a closing rate at 1.292 US$:

GBP, average rate at 1.2633 US$:GBP, and closing rate of 1.4391 US$:CAD.

The relevant translation rates are as follows:

for the year ended March 31, 2024 a closing rate at 1.2626

GBP, average rate at 1.2713

US$:GBP and closing rate at 1.3510

at balance sheet date, shareholders' equity is translated at historical rates and revenue and expense accounts are translated at the average

exchange rate for the year or the reporting period.

The translation adjustments are reported as a separate component of stockholders’

equity, captioned as accumulated other comprehensive (loss) gain.

Transaction gains and losses arising from exchange rate fluctuations

on transactions denominated in a currency other than the functional currency are included in the statements of operations as foreign currency

exchange variance.

The relevant translation rates are as

for the six months ended June 30, 2025 a closing rate at 1.3735 US$:

GBP, average rate at 1.3565 US$:GBP, a closing rate of 1.3607

US$:CAD a closing rate of .01167 INR:USD, a closing rate of TRY:USD .0251 and a closing rate of .2723 UAE :USD.

The relevant translation rates are as

for the six months ended June 30, 2024 a closing rate at 1.2649 US$:

GBP, average rate at 1.2716 US$:GBP and closing rate at

Long-Lived Assets and Goodwill

The Company accounts for long-lived assets in

accordance with the provisions of ASC 360-10-35, Property, Plant and Equipment, Impairment or Disposal of Long-lived Assets.

accounting standard requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that

the carrying amount may not be recoverable.

Recoverability of assets to be held and used is measured by a comparison of the carrying amount

of an asset to future undiscounted net cash flows expected to be generated by the asset.

If the carrying amount of an asset exceeds its

estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair

value of the asset.

The Company accounts for long-lived

assets in accordance with the provisions of ASC 360-10-35, Property, Plant and Equipment, Impairment or Disposal of Long-lived Assets.

This accounting standard requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate

that the carrying amount may not be recoverable.

Recoverability of assets to be held and used is measured by a comparison of the carrying

amount of an asset to future undiscounted net cash flows expected to be generated by the asset.

If the carrying amount of an asset exceeds

its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the

fair value of the asset.

Indefinite-lived intangible assets established

4 unchanged sentences

fair value, an impairment loss is recognized in an amount equal to that excess.

The Company accounts for goodwill and intangible

assets in accordance with ASC 350, Intangibles – Goodwill and Other .

The Company accounts for goodwill and

intangible assets in accordance with ASC 350, Intangibles – Goodwill and Other.

Goodwill represents the excess of the purchase price

12 unchanged sentences

Property and Equipment

Property and equipment are carried at historical

cost less accumulated depreciation.

Depreciation is based on the estimated service lives of the depreciable assets and is calculated

using the straight-line method.

Property and equipment are carried at

historical cost less accumulated depreciation.

Depreciation is based on the estimated service lives of the depreciable assets and is

calculated using the straight-line method.

Expenditures that increase the value or productive capacity of assets are capitalized.

Fully depreciated

assets are retained in the property and equipment, and accumulated depreciation accounts until they are removed from service.

When property

and equipment are retired, sold or otherwise disposed of, the asset’s carrying amount and related accumulated depreciation are

removed from the accounts and any gain or loss is included in operations.

depreciated assets are retained in the property and equipment, and accumulated depreciation accounts until they are removed from service.

When property and equipment are retired, sold or otherwise disposed of, the asset’s carrying amount and related accumulated depreciation

are removed from the accounts and any gain or loss is included in operations.

Repairs and maintenance are expensed as incurred.

The estimated useful lives of property and equipment

are generally as follows:

Schedule of estimated useful lives of property and equipment

The estimated useful lives of property and equipment are generally as follows:

Office furniture and fixtures

3 unchanged sentences

Revenue Recognition

The Company’s revenues are generated primarily

from the sale of our services, which consist primarily of advanced technology solutions for integrated communications and security systems,

as well as habitat management.

The Company’s revenues are generated

primarily from the sale of our services, which consist primarily of advanced technology solutions for integrated communications and security

systems, as well as habitat management.

The Company’s sales of products are primarily generated from our TJM subsidiaries.

Sales of products

and services are separate from one another.

At contract inception, we assess the goods and services promised in the contract with customers

and identify a performance obligation for each.

To determine the performance obligation, we consider all products and services promised

in the contract regardless of whether they are explicitly stated or implied by customary business practices.

of products and services are separate from one another.

At contract inception, we assess the goods and services promised in the contract

with customers and identify a performance obligation for each.

To determine the performance obligation, we consider all products and services

promised in the contract regardless of whether they are explicitly stated or implied by customary business practices.

The timing of satisfaction

6 unchanged sentences

other revenue recognition criteria have been met.

The Company recognizes revenue when its customer

obtains control of promised goods or services, in an amount that reflects the consideration which we expect to receive in exchange for

those goods or services.

To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606,

we perform the following five steps:

The Company recognizes revenue when

its customer obtains control of promised goods or services, in an amount that reflects the consideration which we expect to receive in

exchange for those goods or services.

To determine revenue recognition for arrangements that the Company determines are within the scope

of ASC 606, we perform the following five steps:

(i) identify the contract(s) with a customer;

(ii) identify the performance obligations in the contract;

(ii) identify the performance obligations

in the contract;

(iii) determine the transaction price;

(iv) allocate the transaction price to the performance obligations in the contract;

and (v) recognize

revenue when (or as) we satisfy a performance obligation.

The five-step model is applied to contracts when it is probable that we will

collect the consideration we are entitled to in exchange for the goods or services transferred to the customer.

At contract inception,

once the contract is determined to be within the scope of ASC 606, we assess the goods or services promised within each contract and determine

those that are performance obligations and assess whether each promised good or service is distinct.

We then recognize revenue in the

amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is

The Company considers each individual sale of

service contract to be its own performance obligation.

Services in the contract are highly interdependent and interrelated, and the successful

completion of each milestone is necessary for the overall success of the contract.

Therefore, each milestone is not separately identifiable

from other promises in the contract, and not distinct and ultimately not individual performance obligations.

The Company records revenue over time using the

input measure as it is the most faithful depiction of an entity’s performance because it directly measures the value of the goods

and services transferred to the customer.

The Company utilizes the Right to Invoice for these contracts, as the pricing structure is

based on various milestones that are specified in the contract.

and (v) recognize revenue when (or as) we satisfy a performance obligation.

The five-step model is applied to contracts when it is probable

that we will collect the consideration we are entitled to in exchange for the goods or services transferred to the customer.

inception, once the contract is determined to be within the scope of ASC 606, we assess the goods or services promised within each contract

and determine those that are performance obligations and assess whether each promised good or service is distinct.

We then recognize revenue

in the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation

is satisfied.

The Company considers each individual

sale of service contract to be its own performance obligation.

Services in the contract are highly interdependent and interrelated, and

the successful completion of each milestone is necessary for the overall success of the contract.

Therefore, each milestone is not separately

identifiable from other promises in the contract, and not distinct and ultimately not individual performance obligations.

The Company records revenue over time

using the input measure as it is the most faithful depiction of an entity’s performance because it directly measures the value of

the goods and services transferred to the customer.

The Company utilizes the Right to Invoice for these contracts, as the pricing structure

is based on various milestones that are specified in the contract.

These milestones include Construction Phase Plan, Start of the construction

5 unchanged sentences

In accordance with ASU No.

2016-12, Revenue

from Contracts with Customers (Topic 606):

Revenue from Contracts with Customers (Topic 606):

Narrow-Scope Improvements and Practical Expedient, which is to (1) clarify the objective

of the collectability criterion for applying paragraph 606-10-25-7;

(2) permit an entity to exclude amounts collected from customers

for all sales (and other similar) taxes from the transaction price;

(3) specify that the measurement date for noncash consideration is

contract inception;

(4) provide a practical expedient that permits an entity to reflect the aggregate effect of all modifications that

occur before the beginning of the earliest period presented when identifying the satisfied and unsatisfied performance obligations, determining

the transaction price, and allocating the transaction price to the satisfied and unsatisfied performance obligations;

(5) clarify that

a completed contract for purposes of transition is a contract for which all (or substantially all) of the revenue was recognized under

legacy GAAP before the date of initial application, and (6) clarify that an entity that retrospectively applies the guidance in Topic

606 to each prior reporting period is not required to disclose the effect of the accounting change for the period of adoption.

The amendments

of this ASU are effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years.

no impact as a result of adopting this ASU on the financial statements and related disclosures.

Based on the terms and conditions of

the product arrangements, the Company believes that its products and services can be accounted for separately as its products and services

have value to the Company’s customers on a stand-alone basis.

When a transaction involves more than one product or service, revenue

is allocated to each deliverable based on its relative fair value;

otherwise, revenue is recognized as products are delivered or as services

are provided over the term of the customer contract.

(2) permit an entity to exclude amounts collected from customers for

all sales (and other similar) taxes from the transaction price;

(3) specify that the measurement date for noncash consideration is contract

(4) provide a practical expedient that permits an entity to reflect the aggregate effect of all modifications that occur before

the beginning of the earliest period presented when identifying the satisfied and unsatisfied performance obligations, determining the

transaction price, and allocating the transaction price to the satisfied and unsatisfied performance obligations;

(5) clarify that a completed

contract for purposes of transition is a contract for which all (or substantially all) of the revenue was recognized under legacy GAAP

before the date of initial application, and (6) clarify that an entity that retrospectively applies the guidance in Topic 606 to each

prior reporting period is not required to disclose the effect of the accounting change for the period of adoption.

The amendments of this

ASU are effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years.

There was no impact

as a result of adopting this ASU on the financial statements and related disclosures.

Based on the terms and conditions of the product

arrangements, the Company believes that its products and services can be accounted for separately as its products and services have value

to the Company’s customers on a stand-alone basis.

When a transaction involves more than one product or service, revenue is allocated

to each deliverable based on its relative fair value;

otherwise, revenue is recognized as products are delivered or as services are provided

over the term of the customer contract.

Cost of Revenues

Cost of revenues consists primarily of materials

and overhead costs incurred internally and amounts incurred to contract manufacturers to produce our products, airtime and other implementation

costs incurred to install our products and train customer personnel, and customer service and third- party original equipment manufacturer

costs to provide continuing support to our customers.

Cost of revenues also includes direct labor attributable to revenue service arrangements.

Cost of revenues consists primarily

of materials and overhead costs incurred internally and amounts incurred to contract manufacturers to produce our products, airtime and

other implementation costs incurred to install our products and train customer personnel, and customer service and third- party original

equipment manufacturer costs to provide continuing support to our customers.

Cost of revenues also includes direct labor attributable

to revenue service arrangements.

Concentration of Credit Risk

1 unchanged sentence

subject the Company to concentrations of credit risk consist principally of cash and cash equivalents.

The Company has not

experienced any losses related to its cash and does not believe that it is subject to unusual credit risk beyond the normal credit

risk associated with commercial banking relationships.

As of March 31, 2025, one customer accounted for 39 %

of gross accounts receivable.

The Company accounts for its leases under ASC

842, Leases .

The Company has not experienced

any losses related to its cash and does not believe that it is subject to unusual credit risk beyond the normal credit risk associated

with commercial banking relationships.

As of June 30, 2025, one customer accounted for 39 % of gross accounts receivable.

The Company accounts for its leases

under ASC 842, Leases.

Under this guidance, arrangements meeting the definition of a lease are classified as operating or financing leases

8 unchanged sentences

Variable lease expenses are recorded when incurred.

In calculating the right of use asset and lease

liability, the Company has elected to combine lease and non-lease components.

The Company excludes short-term leases having initial terms

of 12 months or less from the new guidance as an accounting policy election and recognizes rent expense on a straight-line basis over

the lease term.

In calculating the right of use asset

and lease liability, the Company has elected to combine lease and non-lease components.

The Company excludes short-term leases having

initial terms of 12 months or less from the new guidance as an accounting policy election and recognizes rent expense on a straight-line

basis over the lease term.

Derivative Financial Instruments

11 unchanged sentences

Derivative instrument liabilities are

classified in the balance sheet as current or non-current based on whether net-cash settlement of the derivative instrument could be

required within 12 months after the balance sheet date.

classified in the balance sheet as current or non-current based on whether net-cash settlement of the derivative instrument could be required

within 12 months after the balance sheet date.

Fair Value of Financial Instruments

The Company measures its financial assets and

liabilities in accordance with the requirements of FASB ASC 820, Fair Value Measurements and Disclosures.

The Company measures its financial assets

and liabilities in accordance with the requirements of FASB ASC 820, Fair Value Measurements and Disclosures.

As defined in FASB ASC 820,

10 unchanged sentences

for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement) as follows:

Level 1 – Quoted prices are available in

active markets for identical assets or liabilities as of the reporting date.

Active markets are those in which transactions for the asset

or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis.

Level 1 primarily consists of

financial instruments such as exchange-traded derivatives, marketable securities and listed equities.

Level 2 – Pricing inputs are other than

quoted prices in active markets included in level 1, which are either directly or indirectly observable as of the reported date and includes

those financial instruments that are valued using models or other valuation methodologies.

Level 1 – Quoted prices are available

in active markets for identical assets or liabilities as of the reporting date.

Active markets are those in which transactions for the

asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis.

Level 1 primarily consists

of financial instruments such as exchange-traded derivatives, marketable securities and listed equities.

Level 2 – Pricing inputs are other

than quoted prices in active markets included in level 1, which are either directly or indirectly observable as of the reported date and

includes those financial instruments that are valued using models or other valuation methodologies.

These models are primarily industry-standard

6 unchanged sentences

derivatives such as commodity swaps, interest rate swaps, options and collars.

Level 3 – Pricing inputs include significant

inputs that are generally less observable from objective sources.

These inputs may be used with internally developed methodologies that

result in management’s best estimate of fair value.

The Company’s derivative liability is a

Level 3 liability measured at fair value on a recurring basis.

Level 3 – Pricing inputs include

significant inputs that are generally less observable from objective sources.

These inputs may be used with internally developed methodologies

that result in management’s best estimate of fair value.

The Company’s derivative liability

is a Level 3 liability measured at fair value on a recurring basis.

Equity Investments

The Company uses the equity method to account

for investments in which it has the ability to exercise significant influence over the investee’s operating and financial policies,

or in which its holds a partnership or limited liability company interest in an entity with specific ownership accounts, unless it has

virtually no influence over the investee’s operating and financial policies.

The Company uses the equity method to

account for investments in which it has the ability to exercise significant influence over the investee’s operating and financial

policies, or in which it holds a partnership or limited liability company interest in an entity with specific ownership accounts, unless

it has virtually no influence over the investee’s operating and financial policies.

The Company follows the guidance in ASC 323-10-30-2,

7 unchanged sentences

of operations and comprehensive (loss).

Per ASC 323-10-30-2, Joint Ventures are accounted

for using the equity method, in which the Company initially records its investment at cost, including transaction costs.

Under the equity

method, an investment in common stock and in-substance common stock is presented on the balance sheet of an investor as a single amount.

However, any difference between the cost of the investment and the underlying equity in net assets of an investee — commonly referred

to as a basis difference — should be accounted for as if the investee were a consolidated subsidiary.

The Company accounts for income taxes pursuant

to the provision of ASC 740-10, (“ASC 740-10”) which requires, among other things, an asset and liability approach to calculating

deferred income taxes.

The asset and liability approach requires the recognition of deferred tax assets and liabilities for the expected

future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities.

allowance is provided to offset any net deferred tax assets for which management believes it is more likely than not that the net deferred

asset will not be realized.

The Company follows the provision of ASC 740-10

related to Accounting for Uncertain Income Tax Positions.

When tax returns are filed, there may be uncertainty about the merits of positions

taken or the amount of the position that would be ultimately sustained.

In accordance with the guidance of ASC 740-10, the benefit of

a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes

it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes,

Per ASC 323-10-30-2, Joint Ventures

are accounted for using the equity method, in which the Company initially records its investment at cost, including transaction costs.

Under the equity method, an investment in common stock and in-substance common stock is presented on the balance sheet of an investor

as a single amount.

However, any difference between the cost of the investment and the underlying equity in net assets of an investee

— commonly referred to as a basis difference — should be accounted for as if the investee were a consolidated subsidiary.

The Company accounts for income taxes

pursuant to the provision of ASC 740-10, (“ASC 740-10”) which requires, among other things, an asset and liability approach

to calculating deferred income taxes.

The asset and liability approach requires the recognition of deferred tax assets and liabilities

for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities.

A valuation allowance is provided to offset any net deferred tax assets for which management believes it is more likely than not that

the net deferred asset will not be realized.

The Company follows the provision of

ASC 740-10 related to Accounting for Uncertain Income Tax Positions.

When tax returns are filed, there may be uncertainty about the merits

of positions taken or the amount of the position that would be ultimately sustained.

In accordance with the guidance of ASC 740-10, the

benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management

believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation

processes, if any.

Tax positions taken are not offset or aggregated with other positions.

Tax positions that meet the more likely than not

recognition threshold are measured at the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement

with the applicable taxing authority.

The portion of the benefit associated with tax positions taken that exceed the amount measured as

described above should be reflected as a liability for uncertain tax benefits in the accompanying balance sheet along with any associated

interest and penalties that would be payable to the taxing authorities upon examination.

The Company believes its tax positions are all

more likely than not to be upheld upon examination.

Tax positions that meet the more likely

than not recognition threshold are measured at the largest amount of tax benefit that is more than 50 percent likely of being realized

upon settlement with the applicable taxing authority.

The portion of the benefit associated with tax positions taken that exceed the amount

measured as described above should be reflected as a liability for uncertain tax benefits in the accompanying balance sheet along with

any associated interest and penalties that would be payable to the taxing authorities upon examination.

The Company believes its tax positions

are all more likely than not to be upheld upon examination.

As such, the Company has not recorded a liability for uncertain tax benefits.

The Company has adopted ASC 740-10-25, Definition

of Settlement which provides guidance on how an entity should determine whether a tax position is effectively settled for the purpose

of recognizing previously unrecognized tax benefits and provides that a tax position can be effectively settled upon the completion and

examination by a taxing authority without being legally extinguished.

For tax positions considered effectively settled, an entity would

recognize the full amount of tax benefit, even if the tax position is not considered more likely than not to be sustained based solely

on the basis of its technical merits and the statute of limitations remains open.

The federal and state income tax returns of the Company

are subject to examination by the IRS and state taxing authorities, generally for three years after they are filed.

The Company has adopted ASC 740-10-25,

Definition of Settlement which provides guidance on how an entity should determine whether a tax position is effectively settled for the

purpose of recognizing previously unrecognized tax benefits and provides that a tax position can be effectively settled upon the completion

and examination by a taxing authority without being legally extinguished.

For tax positions considered effectively settled, an entity

would recognize the full amount of tax benefit, even if the tax position is not considered more likely than not to be sustained based

solely on the basis of its technical merits and the statute of limitations remains open.

The federal and state income tax returns of the

Company are subject to examination by the IRS and state taxing authorities, generally for three years after they are filed.

The Company's U.S.

subsidiaries were incorporated

subsidiaries were

incorporated in 2017.

The Company does not anticipate a tax liability for the years 2025 and 2024, however may be subject to certain penalties.

Company has filed tax returns in Canada for the year ended December 31, 2018, and they are still subject to audit.

The Company has filed tax returns in Canada for the year ended December 31, 2018, and they are still subject to audit.

Non-controlling Interests

Non-controlling interests are classified as a

separate component of equity in the Company's consolidated balance sheets and statements of changes in stockholders’ equity.

income (loss) and comprehensive income (loss) attributable to non-controlling interests are reflected separately from consolidated net

income (loss) and comprehensive income (loss) in the consolidated statements of comprehensive income (loss) and statements of changes

Non-controlling interests are classified

as a separate component of equity in the Company's consolidated balance sheets and statements of changes in stockholders’ equity.

Net income (loss) and comprehensive income (loss) attributable to non-controlling interests are reflected separately from consolidated

net income (loss) and comprehensive income (loss) in the consolidated statements of comprehensive income (loss) and statements of changes

in stockholders’ equity.

6 unchanged sentences

via its subsidiaries TerraData, Remote Intelligence and Wildlife Specialists.

During the three months ended March 31, 2025

and 2024, the Company recorded a loss of $ 3,554

respectively, attributable to non- controlling interests.

During the six months ended June 30,

2025 and 2024, the Company recorded a loss of $ 7,749 and $ 9,453 respectively, attributable to non- controlling interests.

Comprehensive Loss

Comprehensive loss includes net loss well as other

changes in stockholders’ equity that result from transactions and economic events other than those with stockholders.

three months ended March 31, 2025 and 2024, the Company’s only element of other comprehensive loss was foreign currency translation.

Comprehensive loss includes net loss

well as other changes in stockholders’ equity that result from transactions and economic events other than those with stockholders.

During the six months ended June 30, 2025 and 2024, the Company’s only element of other comprehensive loss was foreign currency

Stock-based Compensation

Stock-based compensation is accounted for based

on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the consolidated financial statements of

the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director

is required to perform the services in exchange for the award (presumptively, the vesting period).

The ASC also requires measurement of

the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award.

Pursuant to ASC Topic 718, for share-based payments

to consultants and other third-parties, compensation expense is determined at the “measurement date.” The expense is recognized

over the vesting period of the award.

Until the measurement date is reached, the total amount of compensation expense remains uncertain.

Stock-based compensation is accounted

for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the consolidated financial statements

of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or

director is required to perform the services in exchange for the award (presumptively, the vesting period).

The ASC also requires measurement

of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award.

Pursuant to ASC Topic 718, for share-based

payments to consultants and other third-parties, compensation expense is determined at the “measurement date.” The expense

is recognized over the vesting period of the award.

Until the measurement date is reached, the total amount of compensation expense remains

The Company initially records compensation expense based on the fair value of the award at the reporting date.

Further, ASC Topic 718,

provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification

accounting in Topic 718, such as the repricing of share options, which would revalue those options and the accounting for the cancellation

of an equity award whether a replacement award or other valuable consideration is issued in conjunction with the cancellation.

the cancellation is viewed as a replacement and not a modification, with a repurchase price of $ 0 .

Topic 718, provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply

modification accounting in Topic 718, such as the repricing of share options, which would revalue those options and the accounting for

the cancellation of an equity award whether a replacement award or other valuable consideration is issued in conjunction with the cancellation.

If not, the cancellation is viewed as a replacement and not a modification, with a repurchase price of $ 0 .

Loss Per Common Share

The Company accounts for earnings per share pursuant

to ASC 260, Earnings per Share , which requires disclosure on the financial statements of "basic" and "diluted"

The Company accounts for earnings per

share pursuant to ASC 260, Earnings per Share, which requires disclosure on the financial statements of “basic” and “diluted”

earnings (loss) per share.

5 unchanged sentences

Potentially dilutive items outstanding as of

December March 31, 2025 and 2024 are as follows:

June 30, 2025 and 2024 are as follows:

Schedule of anti-dilutive securities

2 unchanged sentences

Recently Issued Accounting Pronouncements

On January 1, 2023, the Company adopted ASU 2016-13,

Financial Instruments – Credit Losses (Topic 326):

On January 1, 2023, the Company adopted

ASU 2016-13, Financial Instruments – Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments (ASC 326).

standard replaced the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss

(“CECL”) methodology.

CECL requires an estimate of credit losses for the remaining estimated life of the financial asset using

historical experience, current conditions, and reasonable and supportable forecasts and generally applies to financial assets measured

This standard replaced the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit

loss (“CECL”) methodology.

CECL requires an estimate of credit losses for the remaining estimated life of the financial asset

using historical experience, current conditions, and reasonable and supportable forecasts and generally applies to financial assets measured

at amortized cost, including loan receivables and held-to-maturity debt securities, and some off-balance sheet credit exposures such as

4 unchanged sentences

a material impact on the Company’s consolidated financial statements and related disclosures.

Management does not believe that any other recently

issued, but not yet effective, accounting standards could have a material effect on the accompanying financial statements.

As new accounting

pronouncements are issued, the Company will adopt those that are applicable.

NOTE 3 – LIQUIDITY AND GOING CONCERN

Management does not believe that any

other recently issued, but not yet effective, accounting standards could have a material effect on the accompanying financial statements.

As new accounting pronouncements are issued, the Company will adopt those that are applicable.

NOTE 3 – LIQUIDITY AND GOING

The Company generated net losses of

and $ 536,398 during the three months ended

March 31, 2025 and 2024, respectively, and net cash provided (used) in operating activities of $ 78,774

and $ ( 91,687 ) ,

respectively.

As of March 31, 2025, the Company’s current liabilities exceeded its current assets by $ 17,368,854

and an accumulated deficit of $ 71,526,469 .

As of March 31, 2025, the Company had $ 107,785 of cash.

The Company will require additional funding during

the next twelve months to finance the growth of its current operations and achieve its strategic objectives.

These factors, as well as

the uncertain conditions that the Company faces relative to capital raising activities, create substantial doubt as to the Company’s

ability to continue as a going concern.

The Company is seeking to raise additional capital principally through private placement offerings

and is targeting strategic partners in an effort to finalize the development of its products and begin generating revenues.

of the Company to continue as a going concern is dependent upon the success of future capital offerings or alternative financing arrangements

or expansion of its operations.

The accompanying consolidated financial statements do not include any adjustments that might be necessary

should the Company be unable to continue as a going concern.

Management is actively pursuing additional sources of financing sufficient

to generate enough cash flow to fund its operations for twelve months from the issuance date of these consolidated financial statements.

$ 1,033,417 and $ 2,953,104 during the six months ended June 30, 2025 and 2024, respectively, and net cash provided (used) in operating

activities of $ 494,513 and $( 313,725 ), respectively.

As of June 30, 2025, the Company’s current liabilities exceeded its current

assets by $ 18,484,093 and had an accumulated deficit of $ 72,285,347 .

As of June 30, 2025, the Company had $ 102,134 of cash.

The Company will require additional

funding during the next twelve months to finance the growth of its current operations and achieve its strategic objectives.

These factors,

as well as the uncertain conditions that the Company faces relative to capital raising activities, create substantial doubt as to the

Company’s ability to continue as a going concern.

The Company is seeking to raise additional capital principally through private

placement offerings and is targeting strategic partners in an effort to finalize the development of its products and begin generating

The ability of the Company to continue as a going concern is dependent upon the success of future capital offerings or alternative

financing arrangements or expansion of its operations.

The accompanying consolidated financial statements do not include any adjustments

that might be necessary should the Company be unable to continue as a going concern.

Management is actively pursuing additional sources

of financing sufficient to generate enough cash flow to fund its operations for twelve months from the issuance date of these consolidated

financial statements.

However, management cannot make any assurances that such financing will be secured.

2 unchanged sentences

& Security Systems, Ltd.

On September 11, 2024, the Company closed a sale agreement with Joint

Liquidators, Optilan (UK) Limited incorporated and registered in England and Wales acting by the Joint Liquidators (Seller), purchasing

the right, title and interest of shares in Optilan India, PVT Ltd located in Kilpauk, Chennai India and Optilan Communication & Security

Systems, Ltd located in Ankara, Turkey along with the applicable intellectual property rights including (1) the user interface for sensor

systems, (2) The “Optilan.com” domain

name and continued use of the “@optilan.com” email accounts.

The Company agreed to pay $ 65,000 USD for both companies and

the intellectual property rights.

The Company has accounted for the purchase using

the acquisition method of accounting for business combinations under ASC 805.

Accordingly, the purchase price has been allocated to the

underlying assets and liabilities in proportion to their respective actual values as of the purchase date.

On September 11, 2024, the Company closed

a sale agreement with Joint Liquidators, Optilan (UK) Limited incorporated and registered in England and Wales acting by the Joint Liquidators

(Seller), purchasing the right, title and interest of shares in Optilan India, PVT Ltd located in Kilpauk, Chennai India and Optilan Communication

& Security Systems, Ltd located in Ankara, Turkey along with the applicable intellectual property rights including (1) the user interface

for sensor systems, (2) The “Optilan.com” domain name and continued use of the “@optilan.com” email accounts.

The Company agreed to pay $ 65,000 USD for both companies and the intellectual property rights.

The Company has accounted for the purchase

using the acquisition method of accounting for business combinations under ASC 805.

Accordingly, the purchase price has been allocated

to the underlying assets and liabilities in proportion to their respective actual values as of the purchase date.

The excess of the consideration

2 unchanged sentences

the acquired assets and assumed liabilities for the actual value of the assets and liabilities recognized at the date of acquisition:

Schedule of acquired assets and assumed

Schedule of acquired assets and assumed liabilities

Consideration

1 unchanged sentence

Purchase price

The allocation of the total purchase price to

the tangible and intangible assets acquired and liabilities assumed by DarkPulse based on actual values as of September 11, 2024, and

measurement period adjustments resulting from the Optilan India fiscal audit period April 2023 – March 2024 which was completed

in December 2024 are as follows:

The allocation of the total purchase

price to the tangible and intangible assets acquired and liabilities assumed by DarkPulse based on actual values as of September 11,

2024, and measurement period adjustments resulting from the Optilan India fiscal audit period April 2023 – March 2024 which was

completed in December 2024 are as follows:

Schedule of fair value assets acquired and liabilities

(Amounts in US$’s)

Amounts Recognized as of Acquisition Date

Amounts Recognized as of

Acquisition Date

Measurement Period

Accounts receivable

5 unchanged sentences

NOTE 5 – REVENUE

The following table is a summary of the Company’s

timing of revenue recognition for the three months ended March 31, 2025 and 2024:

Schedule of timing of revenue

Three Months Ended

The following table is a summary of the

Company’s timing of revenue recognition for the six months ended June 30, 2025 and 2024:

Schedule of timing of revenue recognition

Services and products transferred at a point in time

1 unchanged sentence

Total revenue

The Company disaggregates revenue by source and

geographic destination to depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors.

Revenue by source consisted of the following for

the three months ended March 31, 2025 and 2024:

The Company disaggregates revenue by

source and geographic destination to depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic

Revenue by source consisted of the following

for the six months ended June 30, 2025 and 2024:

Schedule of revenue by source

Three Months Ended

Total revenue

Revenue by geographic destination consisted of

the following for the three months ended March 31, 2025 and 2024:

Revenue by geographic destination consisted

of the following for the six months ended June 30, 2025 and 2024:

Schedule of revenue by geographic destination

Three Months Ended

North America

2 unchanged sentences

Total revenue

Contract revenue is recognized over time using

the cost-to-cost measure of progress for fixed price contracts.

The cost-to-cost measure of progress best depicts the continuous transfer

of control of goods or services to the customer.

The contractual terms provide that the customer compensates the Company for services

Contract costs include all direct materials, labor

and subcontracted costs, as well as indirect costs related to contract performance, such as indirect labor, supplies, tools, repairs and

the costs of capital equipment.

Contract revenue is recognized over

time using the cost-to-cost measure of progress for fixed price contracts.

The cost-to-cost measure of progress best depicts the continuous

transfer of control of goods or services to the customer.

The contractual terms provide that the customer compensates the Company for

services rendered.

Contract costs include all direct materials,

labor and subcontracted costs, as well as indirect costs related to contract performance, such as indirect labor, supplies, tools, repairs

and the costs of capital equipment.

The cost estimation and review process for recognizing revenue over time under the cost-to- cost method

10 unchanged sentences

Performance Obligations

A performance obligation is a contractual promise

to transfer a distinct good or service to the customer and is the unit of account under Accounting Standards Codification (“ASC”)

A performance obligation is a contractual

promise to transfer a distinct good or service to the customer and is the unit of account under Accounting Standards Codification (“ASC”)

The transaction price of a contract is allocated to distinct performance obligations and recognized as revenue when or as the

7 unchanged sentences

obligations are completed within one year.

When more than one contract is entered into with

a customer on or close to the same date, the Company evaluates whether those contracts should be combined and accounted for as a single

contract as well as whether those contracts should be accounted for as more than one performance obligation.

This evaluation requires

significant judgment and is based on the facts and circumstances of the various contracts, which could change the amount of revenue and

profit recognition in a given period depending upon the outcome of the evaluation.

When more than one contract is entered

into with a customer on or close to the same date, the Company evaluates whether those contracts should be combined and accounted for

as a single contract as well as whether those contracts should be accounted for as more than one performance obligation.

This evaluation

requires significant judgment and is based on the facts and circumstances of the various contracts, which could change the amount of revenue

and profit recognition in a given period depending upon the outcome of the evaluation.

Contract Assets and Liabilities

The Company bill its customers based on contractual

terms, including, milestone billings based on the completion of certain phases of the work.

Sometimes, billing occurs after revenue recognition,

resulting in unbilled revenue, which is accounted for as a contract asset.

Sometimes the Company receives advances payments from our customers

before revenue is recognized, resulting in deferred revenue, which is accounted for as a contract liability.

Contract assets in the consolidated balance sheets

represents costs and estimated earnings in excess of billings, which arise when revenue has been recorded but the amount has not been

Contract assets and liabilities on March 31, 2025

are $ 0 upon the deconsolidation related to the Optilan liquidation.

The Company bill its customers based

on contractual terms, including, milestone billings based on the completion of certain phases of the work.

Sometimes, billing occurs after

revenue recognition, resulting in unbilled revenue, which is accounted for as a contract asset.

Sometimes the Company receives advances

payments from our customers before revenue is recognized, resulting in deferred revenue, which is accounted for as a contract liability.

Contract assets in the consolidated

balance sheets represents costs and estimated earnings in excess of billings, which arise when revenue has been recorded but the amount

has not been billed.

Contract assets and liabilities on June

30, 2025 are $ 0 .

Variable Consideration

Transaction pricing for the Company’s contracts

may include variable consideration, such as unapproved change orders, claims, incentives and liquidated damages.

Management estimates

variable consideration for a performance obligation utilizing estimation methods that best predict the amount of consideration to which

the Company will be entitled.

Variable consideration is included in the estimated transaction price to the extent it is probable that

a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration

Transaction pricing for the Company’s

contracts may include variable consideration, such as unapproved change orders, claims, incentives and liquidated damages.

estimates variable consideration for a performance obligation utilizing estimation methods that best predict the amount of consideration

to which the Company will be entitled.

Variable consideration is included in the estimated transaction price to the extent it is probable

that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration

Management’s estimates of variable consideration and determination of whether to include estimated amounts in transaction

7 unchanged sentences

NOTE 6 – ACCOUNTS RECEIVABLE

Accounts receivable consisted of the following:

Accounts receivable consisted of the

Schedule of accounts receivable

10 unchanged sentences

Property and equipment, net

Depreciation expenses was $ 17,254

and $ 18,871 for the three months ended March 31, 2025

and 2024, respectively.

NOTE 8 - GOODWILL AND INTANGIBLE ASSETS

The following is a summary of activity of goodwill for the three

months ended March 31, 2025:

Depreciation expenses was $ 49,558 and

$ 63,872 for the six months ended June 30, 2025 and 2024, respectively.

NOTE 8 - GOODWILL AND INTANGIBLE

The following is a summary of activity

of goodwill for the three months ended June 30, 2025:

Schedule of goodwill activity

1 unchanged sentence

Foreign exchange translation

Balances at March 31, 2025

Patents - Intrusion Detection Intellectual

The Company relies on patent laws and restrictions

on disclosure to protect its intellectual property rights.

As of March 31, 2025 and 2024, the Company held three U.S.

and foreign patents

on its intrusion detection technology, which expire in calendar years 2025 through 2034 (depending on the payment of maintenance fees).

The DPTI issued patents cover a System and Method

for Brillouin Analysis, a System and Method for Resolution Enhancement of a Distributed Sensor, and a Flexible Fiber Optic Deformation

System Sensor and Method.

Balances at June 30, 2025

Patents - Intrusion Detection

Intellectual Property

The Company relies on patent laws and

restrictions on disclosure to protect its intellectual property rights.

As of June 30, 2025 and 2024, the Company held three U.S.

foreign patents on its intrusion detection technology, which expire in calendar years 2025 through 2034 (depending on the payment of maintenance

The DPTI issued patents cover a System

and Method for Brillouin Analysis, a System and Method for Resolution Enhancement of a Distributed Sensor, and a Flexible Fiber Optic

Deformation System Sensor and Method.

Maintenance of intellectual property rights and the protection thereof is important to our business.

that may be issued may not sufficiently protect the Company's intellectual property and third parties may challenge any issued patents.

Other parties may independently develop similar or competing technology or design around any patents that may be issued to the Company.

Any patents that may be issued may not sufficiently protect the Company's intellectual property and third parties may challenge any issued

Other parties may independently develop similar or competing technology or design around any patents that may be issued to the

The Company cannot be certain that the steps it has taken will prevent the misappropriation of its intellectual property, particularly

6 unchanged sentences

might infringe upon, since these applications are often not publicly available until a patent is issued or published.

For the three months ended March 31, 2025 and

2024, the Company had patent amortization costs on its intrusion detection technology totaling $ 12,727

and $ 14,212 ,

respectively.

Patents costs are being amortized over the remaining life of each patent, which is from 7

to 16 years .

The DPTI issued patents cover a System and Method

for Brillouin Analysis, a System and Method for Resolution Enhancement of a Distributed Sensor, and a Flexible Fiber Optic Deformation

System Sensor and Method.

For the six months ended June 30, 2025

and 2024, the Company had patent amortization costs on its intrusion detection technology totaling $ 25,514 and $ 25,514 , respectively.

Patents costs are being amortized over the remaining life of each patent, which is from 7 to 16 years .

The DPTI issued patents cover a System

and Method for Brillouin Analysis, a System and Method for Resolution Enhancement of a Distributed Sensor, and a Flexible Fiber Optic

Deformation System Sensor and Method.

Maintenance of intellectual property rights and the protection thereof is important to our business.

that may be issued may not sufficiently protect the Company's intellectual property and third parties may challenge any issued patents.

Other parties may independently develop similar or competing technology or design around any patents that may be issued to the Company.

Any patents that may be issued may not sufficiently protect the Company's intellectual property and third parties may challenge any issued

Other parties may independently develop similar or competing technology or design around any patents that may be issued to the

The Company cannot be certain that the steps it has taken will prevent the misappropriation of its intellectual property, particularly

6 unchanged sentences

might infringe upon, since these applications are often not publicly available until a patent is issued or published.

The following is a summary of the DPTI patents

as of March 31, 2025 and 2024:

The following is a summary of the DPTI

patents as of June 30, 2025 and 2024:

Schedule of patents

1 unchanged sentence

Future expected amortization of patents is as follows:

Schedule of future expected amortization of patents

As of December 31,

Schedule of future expected amortization of patents

Total patents

NOTE 10 – ACCOUNTS PAYABLE AND ACCRUED

Accounts payable and accrued expenses consists

of the following as of March 31, 2025 and March 31, 2024:

NOTE 9 – ACCOUNTS PAYABLE

AND ACCRUED EXPENSES

Accounts payable and accrued expenses

consist of the following as of June 30, 2025 and June 30, 2024:

Schedule of accounts payable and accrued expenses

4 unchanged sentences

Convertible Notes

The Company uses the Black-Scholes Model to calculate

the derivative value of its convertible debt.

The valuation result generated by this pricing model is necessarily driven by the value

of the underlying common stock incorporated into the model.

The values of the common stock used were based on the price at the date of

issue of the debt security as of March 31, 2025 and 2024.

In 2024 management determined the expected volatility of 106.90%, a risk-free

rate of interest of 5.48%, and contractual lives of the debt of three months.

The Company uses the Black-Scholes Model

to calculate the derivative value of its convertible debt.

The valuation result generated by this pricing model is necessarily driven

by the value of the underlying common stock incorporated into the model.

The values of the common stock used were based on the price at

the date of issue of the debt security as of June 30, 2025 and 2024.

In 2024 management determined the expected volatility of 106.90%,

a risk-free rate of interest of 5.48%, and contractual lives of the debt of three months.

In 2024 management determined the expected volatility

of 140.30%, a risk-free rate of interest of 4.73%, and contractual lives of the debt of three months.

Management made the determination

to use an expected life rather than contractual life for the calculations for the matured debt as of March 31, 2025 and 2024.

As of March 31, 2025 and, 2024, there was

$ 0 and $ 166,650

of convertible debt principal outstanding.

During the three months ended March 31, 2025 and 2024, $ 0

to use an expected life rather than contractual life for the calculations for the matured debt as of June 30, 2025 and 2024.

As of June, 2025 and, 2024, there was

$ 0 and $ 91,971 of convertible debt principal outstanding, respectively.

During the six months ended June 30, 2025 and 2024, $ 0 and $ 0

of the debt discount was amortized.

4 unchanged sentences

Convertible notes, net

The table below details the Company's outstanding convertible notes

and related derivative liability:

Schedule of outstanding convertible notes and derivative liability

Derivative Liability

1800 Diagonal Lending

During the three months ended March 31, 2025

and 2024, change in fair value of the derivative liability was $57,235 and $51,723, respectively.

The following is a summary of the

derivative liability:

During the three months ended June 30, 2025 and

2024, change in fair value of the derivative liability was $ 90,103 and $ 94,759 , respectively.

The following is a summary of the derivative

Schedule of derivative liability

Derivative Liability

Balances at December 31, 2024

3 unchanged sentences

EMA settlement

Balances at March 31, 2025

Balances at June 30, 2025

Notes Payable

On August 27, 2024, the Company entered into a

promissory note for a principal of $ 67,200 , which was funded on August 30, 2024.

The note bears interest at a rate of 12 % per annum and

matures after nine months.

On November 20, 2024, the Company entered into

a promissory note for a principal of $ 67,860 , which was funded on December 2, 2024.

On August 27, 2024, the Company entered

into a promissory note for a principal of $ 67,200 , which was funded on August 30, 2024.

The note bears interest at a rate of 12 % per annum

and matures after nine months.

On November 20, 2024, the Company entered

into a promissory note for a principal of $ 67,860 , which was funded on December 2, 2024.

The note bears interest at a rate of 15 % per

annum and matures after nine months.

Loans Payable

The Company’s RI and WS subsidiaries have

various loans including Small Business Association (“SBA”) Economic Injury Disaster Loan (“EIDL’) loans, lines

of credit and other advances.

The Company’s RI and WS subsidiaries

have various loans including Small Business Association (“SBA”) Economic Injury Disaster Loan (“EIDL’) loans,

lines of credit and other advances.

The loans bear interest with varying rates up to 9.25% per annum.

The following is a summary of the loans

payable at March 31, 2025 and December 31, 2024:

Schedule of loans

The following is a summary of the

loans payable at June 30, 2025 and December 31, 2024:

Schedule of loans payable

RI - line of credit

30 unchanged sentences

The Debenture is secured by the Patents assigned by the University to DPTI by an Assignment Agreement on December 16,

DPTI has pledged the Patents, and granted a lien on them pursuant to an Escrow Agreement dated April 24, 2017, between DPTI and

the University.

The Debenture was initially recorded at the $1,491,923

equivalent US Dollar amount of Canadian 1,500,000 as of December 16, 2010, the date of the original Debenture.

The liability is being

adjusted quarterly based on the current exchange value of the Canadian dollar to the US dollar at the end of each quarter.

The adjustment

is recorded as unrealized gain or loss in the change of the value of the two currencies during the quarter.

The Debenture also includes

a provision requiring DPTI to pay the University a 2% royalty on sales of any and all products or services which incorporate the Patents

for a period of five years from April 24, 2018.

DPTI has pledged the Patents and granted a lien on them pursuant to an Escrow Agreement dated April 24, 2017, between DPTI and the

The Debenture was initially recorded

at the $1,491,923 equivalent US Dollar amount of Canadian 1,500,000 as of December 16, 2010, the date of the original Debenture.

The liability

is being adjusted quarterly based on the current exchange value of the Canadian dollar to the US dollar at the end of each quarter.

adjustment is recorded as unrealized gain or loss in the change of the value of the two currencies during the quarter.

The Debenture also

includes a provision requiring DPTI to pay the University a 2% royalty on sales of any and all products or services which incorporate

the Patents for a period of five years from April 24, 2018.

To date, no royalties have been paid.

For the three months ended March 31, 2025 and

2024, the Company recorded interest expense of $ 3,914

respectively.

As of March 31, 2025 and 2024, the

outstanding balance of the debenture liability totaled $ 767,865 and $ 916,042 , respectively.

Future minimum required payments over the next

five years and thereafter are as follows:

For the six months ended June 30, 2025

and 2024, the Company recorded interest expense of $ 6,699 and $ 77,644 , respectively.

As of June 30, 2025 and 2024, the outstanding balance

of the debenture liability totaled $ 757,866 and 1,099,250 , respectively.

Future minimum required payments over

the next five years and thereafter are as follows:

Schedule of future minimum required payments

Period ending March 31,

Period ending June 31,

NOTE 12 – LEASES

The following was included in our balance sheet

as of March 31, 2025 and 2024:

The following was included in our balance sheet as of June 30, 2025 and 2024:

Schedule of operating lease

4 unchanged sentences

Total operating lease liabilities

The weighted average remaining lease term and

weighted average discount rate at March 31, 2025 and 2024 were as follows:

The weighted average remaining lease

term and weighted average discount rate at June 30, 2025 and 2024 were as follows:

Schedule of weighted average remaining lease term and discount rate

3 unchanged sentences

Operating Leases

On January 15, 2025 SVEA Cameron Esperson filed

its Motion for Nonsuit without Prejudice.

On January 15, 2025 SVEA Cameron Esperson

filed its Motion for Nonsuit without Prejudice.

The dismissal was accepted by the court on January 16, 2025.

The following table reconciles future minimum

operating lease payments to the discounted lease liability as of March 31, 2025:

Schedule of future minimum operating lease payments

Three Months Ended March 31,

2027 and later

Total lease payments

Less imputed interest

Total lease obligations

Less current lease obligations

Long-term lease obligations

NOTE 14 – STOCKHOLDERS’ EQUITY (DEFICIT)

NOTE 13 – STOCKHOLDERS’

EQUITY (DEFICIT)

Preferred Stock

In accordance with the Company’s bylaws,

the Company has authorized a total of 2,000,000 shares of preferred stock, par value $ 0.01 per share, for all classes.

As of March 31,

2025 and 2024 respectively, there were 88,335 and 88,335 total preferred shares issued and outstanding for all classes.

In accordance with the Company’s bylaws,

the Company has authorized a total of 20,000,000,000 shares of common stock, par value $ 0.0001 per share.

As of March 31, 2025 and 2024,

there were 12,186,976,200 and 8,330,852,145 common shares issued, respectively.

In accordance with the Company’s

bylaws, the Company has authorized a total of 2,000,000 shares of preferred stock, par value $ 0.01 per share, for all classes.

30, 2025 and December 2024 respectively, there were 88,335 and 88,335 total preferred shares issued and outstanding for all classes.

In accordance with the Company’s

bylaws, the Company has authorized a total of 20,000,000,000 shares of common stock, par value $ 0.0001 per share.

As of June 30 30, 2025

and December 2024, there were 14,666,648,287 and 10,551,957,534 common shares issued, respectively.

2024 Transactions

On November 6, 2024 the Company entered into an

Amendment to the 2023 Equity Financing Agreement with GHS, to which GHS agreed to Purchase $ 30,000,000 in shares of our Common Stock over

the course of 12 months at 92 % of the current market price.

The below table of puts from 1/03/2025 through

3/27/2025 were made by the Company under the 2024 EFA during 2025:

On November 6, 2024 the Company entered

into an Amendment to the 2023 Equity Financing Agreement with GHS, to which GHS agreed to Purchase $ 30,000,000 in shares of our Common

Stock over the course of 12 months at 92 % of the current market price.

The below table of puts from January

1, 2025 to June 20, 2025 were made by the Company under the 2024 EFA during 2025:

Schedule of equity financing agreement

2 unchanged sentences

Effective Price per Share

The RRA provides that we shall (i) use our best

efforts to file with the SEC a Registration Statement within 45 days of the date of the GHS Registration Rights Agreement;

and (ii) have

the Registration Statement declared effective by the SEC within 30 days after the date the GHS Registration Statement is filed with the

SEC, but in no event more than 90 days after the GHS Registration Statement is filed.

2,998,024,750

The RRA provides that we shall (i) use

our best efforts to file with the SEC a Registration Statement within 45 days of the date of the GHS Registration Rights Agreement;

(ii) have the Registration Statement declared effective by the SEC within 30 days after the date the GHS Registration Statement is filed

with the SEC, but in no event more than 90 days after the GHS Registration Statement is filed.

Stock Options

As of March 31, 2025 and 2024, the Company had no outstanding stock

As of June 30, 2025 and 2024, the Company

had no outstanding stock options.

NOTE 14 – INCOME TAXES

The provision for income taxes for the three

months ended March 31, 2025 and 2024 differs from the amount which would be expected as a result of applying the statutory tax rates

The provision for income taxes for the

three months ended June 30, 2025 and 2024 differs from the amount which would be expected as a result of applying the statutory tax rates

to the losses before income taxes due primarily to the valuation allowance to fully reserve net deferred tax assets.

The following table summarizes the significant

differences between statutory rates for the three months ended March 31, 2025 and 2024:

differences between statutory rates for the three months ended June 30, 2025 and 2024:

Schedule of statutory rates

4 unchanged sentences

Change in valuation allowance:

The Company’s deferred tax assets and liabilities

as of March 31, 2025 and 2024 are as follows:

Schedule of deferred

tax assets and liabilities

The Company’s deferred tax assets and liabilities as of June 30, 2025 and 2024

are as follows:

Schedule of deferred tax assets and liabilities

Deferred Tax (Liabilities):

8 unchanged sentences

Deferred tax assets (liabilities)

The Company has approximately $ 26,485,942 of federal

and state net operating loss carryforwards as of March 31, 2025.

Of the $26.4 million of NOL's, $ 4.8 million will begin to expire in 2023

while $ 15.9 million will not expire but will be limited to 80% utilization.

The company also has net operating losses in the UK of $ 22,085,338

and $ 636,852 of net operating loss carryforwards in Canada which will begin to expire in 2038.

The Company has approximately $ 26,485,942

of federal and state net operating loss carryforwards as of June 30, 2025.

Of the $26.4 million of NOL's, $ 4.8 million will begin to expire

in 2023 while $ 15.9 million will not expire but will be limited to 80% utilization.

The Company also has net operating losses in the UK

of $ 22,085,338 and $ 636,852 of net operating loss carryforwards in Canada which will begin to expire in 2038.

The Company records a tax valuation

allowance when it is more likely than not that it will not be able to recover the value of its deferred tax assets.

For the three

months ended March 31, 2025 and 2024, the Company calculated its estimated annualized effective tax rate at 0 %

respectively, for both the United States, Canada and the UK.

The Company had no

income tax expense on its losses for the three months ended March 31, 2025 and 2024, respectively.

The Company recognizes the financial statement

benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following

For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest

benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the relevant tax authority.

recognizes interest accrued on uncertain tax positions as well as interest received from favorable tax settlements within interest expense.

For the three months

ended June 30, 2025 and 2024, the Company calculated its estimated annualized effective tax rate at 0 % and 0 %, respectively, for both

the United States, Canada and the UK.

The Company had no income tax expense on its losses for the three months ended June 30, 2025 and

2024, respectively.

The Company recognizes the financial

statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position

following an audit.

For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is

the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the relevant tax authority.

The Company recognizes interest accrued on uncertain tax positions as well as interest received from favorable tax settlements within

interest expense.

The Company recognizes penalties accrued on unrecognized tax benefits within selling, general and administrative expenses.

31, 2025 and 2024, the Company had no uncertain tax positions.

The Company does not anticipate any significant

changes to the total amounts of unrecognized tax benefits in the next twelve months.

The Company files income tax returns in New Brunswick,

Canada, and the U.S.

As of June 30, 2025 and 2024, the Company had no uncertain tax positions.

The Company does not anticipate any

significant changes to the total amounts of unrecognized tax benefits in the next 12 months.

The Company files income tax returns in New

Brunswick, Canada, and the U.S.

federal, New York, and Delaware and the UK jurisdictions.

Tax years 2012 to current remain open to examination by

Canadian authorities;

Tax years 2012 to current remain open to examination

by Canadian authorities;

the tax year 2020 remains open to examination by U.S.

NOTE 16 – COMMITMENTS AND CONTINGENCIES

NOTE 15 – COMMITMENTS AND

CONTINGENCIES

Legal Matters

Capital, L.P.

Carebourn Capital, L.P.

DarkPulse, Inc.

or about January 29, 2021, Carebourn Capital, L.P.

(“ Carebourn ”) commenced an action against the Company in Minnesota

Carebourn alleged that the Company was in breach of certain securities purchase agreements and convertible promissory notes

sold to Carebourn on or about July 17, 2018 and July 24, 2018.

or about August 31, 2021, the Company answered Carebourn’s complaint and interposed affirmative defenses, including that Carebourn

was an unregistered “dealer,” as such term is defined in the Securities Exchange Act of 1934 (“ Exchange Act ”)

and, therefore, all contracts between the parties arising from or related to the securities purchase agreements and convertible promissory

notes sold to Carebourn on or about July 17, 2018 and July 24, 2018 were void pursuant to the Exchange Act.

The Company also asserted

counterclaims against Carebourn under the Minnesota Securities Act.

or about April 21, 2023, the State Court ruled in the Company’s favor on its motion for partial summary judgment on its Exchange

Act defense, holding that (i) Carebourn is a “dealer” under the Exchange Act in violation of the mandatory registration

requirement imposed thereby, and (ii) all contracts between the parties are void.

or about November 17, 2023, the State Court ruled in the Company’s favor on its motion for summary judgment on its Minnesota Securities

Act counterclaims against Carebourn and awarded damages for Carebourn’s violation of Minn.

§ 80A.76(d) in the amount

of $124,012.91, attorney’s fees in the amount of $239,923.33 and costs in the amount of $23,757.24 (or a total award in the amount

of $387,693.48).

of the date hereof, the final judgment remains unsatisfied by Carebourn.

DarkPulse intends to continue to exercise all legal rights and

remedies available to it to collect the amounts awarded should Carebourn fail to voluntarily pay the same.

Capital, LLC v.

On or about January 29, 2021, Carebourn Capital,

(“Carebourn”) commenced an action against the Company in Minnesota State Court.

Carebourn alleged that the Company was

in breach of certain securities purchase agreements and convertible promissory notes sold to Carebourn on or about July 17, 2018 and July

On or about August 31, 2021, the Company answered

Carebourn’s complaint and interposed affirmative defenses, including that Carebourn was an unregistered “dealer,” as

such term is defined in the Securities Exchange Act of 1934 (“Exchange Act”) and, therefore, all contracts between the parties

arising from or related to the securities purchase agreements and convertible promissory

Notes sold to Carebourn on or about July 17, 2018

and July 24, 2018 were void pursuant to the Exchange Act.

The Company also asserted counterclaims against Carebourn under the Minnesota

Securities Act.

On or about April 21, 2023, the State Court ruled

in the Company’s favor on its motion for partial summary judgment on its Exchange Act defense, holding that (i) Carebourn is a “dealer”

under the Exchange Act in violation of the mandatory registration requirement imposed thereby, and (ii) all contracts between the parties

On or about November 17, 2023, the State Court

ruled in the Company’s favor on its motion for summary judgment on its Minnesota Securities Act counterclaims against Carebourn

and awarded damages for Carebourn’s violation of Minn.

§ 80A.76(d) in the amount of $124,012.91, attorney’s fees

in the amount of $239,923.33 and costs in the amount of $23,757.24 (or a total award in the amount of $387,693.48).

The final judgment remains unsatisfied by Carebourn.

DarkPulse intends to continue to exercise all legal rights and remedies available to it to collect the amounts awarded should Carebourn

fail to voluntarily pay the same.

More Capital, LLC v.

DarkPulse, Inc.

or about June 29, 2021, More Capital, LLC (“ More ”) commenced an action against the Company in Minnesota State Court.

More alleged that the Company was in breach of a certain securities purchase agreement and convertible promissory note sold to More on

or about August 20, 2018.

or about September 3, 2021, the Company answered More’s complaint and interposed affirmative defenses, including that More was

an unregistered “dealer,” as such term is defined in the Exchange Act and, therefore, all contracts between the parties arising

On or about June 29, 2021, More Capital, LLC (“More”)

commenced an action against the Company in Minnesota State Court.

More alleged that the Company was in breach of a certain securities

purchase agreement and convertible promissory note sold to More on or about August 20, 2018.

On or about September 3, 2021, the Company answered

More’s complaint and interposed affirmative defenses, including that More was an unregistered “dealer,” as such term

is defined in the Securities Exchange Act of 1934 (“Exchange Act”) and, therefore, all contracts between the parties arising

from or related to the securities purchase agreement and convertible promissory note sold to More on or about August 20, 2018 were void

1 unchanged sentence

The Company also asserted counterclaims against More under the Minnesota Securities Act.

or about December 11, 2023, the Minnesota State Court ruled in the Company’s favor on its motion for summary judgment on its (a) Exchange

Act defense, holding that (1) More is a “dealer” under the Exchange Act in violation of the mandatory registration requirement

imposed thereby, and (ii) all contracts between the parties are void, and (b) Minnesota Securities Act counterclaims against

More and awarded damages for More’s violation of Minn.

§ 80A.76(d) in the amount of $300,809.39, attorney’s

fees in the amount of $110,029.00 and costs in the amount of $210.25 (or a total award in the amount of $412,048.64).

of the date hereof, the final judgment remains unsatisfied by More.

DarkPulse intends to continue to exercise all legal rights and remedies

available to it to collect the amounts awarded should More fail to voluntarily pay the same.

Capital et al v.

Standard Registrar and Transfer et al

or about May 20, 2022, Carebourn and More (More, together with Carebourn, the “ Noteholders ”) commenced an action against

the Company, certain members of the Company’s executive team and board of directors and Standard Registrar and Transfer Company,

Inc., the Company’s transfer agent, in the United States District Court for the District of Utah.

The Noteholders’ complaint

alleged various causes of action arising from certain securities purchase agreements and convertible promissory notes the Company sold

to the Noteholders.

or about November 1, 2023, the Noteholders moved to dismiss the action.

or about November 2, 2023, the Company moved for sanctions against the Noteholders and their counsel of record.

or about December 4, 2023, the Court entered an order granting dismissal of the Noteholders’ claims with prejudice.

The Court acknowledged

that notwithstanding its dismissal of the Noteholders’ claims, the Court continues to retain jurisdiction over the Noteholders

because of DarkPulse’s pending motion for sanctions against the Noteholders and their attorneys.

September 10, 2024, the Court entered an order granting in part the Company’s motion for sanctions against the Noteholders and

their counsel of record.

of the date hereof, the Court has not yet rendered its decision on the amount sanctions that will be imposed against the Noteholders

and their counsel of record and awarded to the Company.

FirstFire Global Opportunities Fund, LLC, and Eli Fireman

or about December 31, 2021, the Company commenced an action against FirstFire Global Opportunities Fund, LLC (“ FirstFire ”)

and its control person, Eli Fireman (“ Fireman ,” and together with FirstFire, the “ FirstFire Defendants ”),

in the United States District Court for the Southern District of New York.

or about May 5, 2022, the Company amended its complaint against the FirstFire Defendants.

The amended complaint alleges that the FirstFire

Defendants were liable to the Company for rescission of certain convertible promissory notes and transitions effected thereunder and

damages pursuant to the Racketeer Influenced and Corrupt Organizations Act (“ RICO ”).

or about January 17, 2023, the Court granted the FirstFire Defendants’ motion to dismiss the Company’s operative pleading.

On the same day, the Company appealed the Court’s decision to the United States Court of Appeals for the Second Circuit (“ Second

March 28, 2024, the Second Circuit issued its decision and found that the District Court (a) properly found that the Delaware forum-selection

clause was enforceable but, thereafter, (b) improperly made a ruling on the merits of the Company’s claims for relief.

a result, the Second Circuit affirmed the District Court’s decision in part, vacated in part and remanded the case back to the

District Court for transferring to the United States District Court for the District of Delaware.

September 9, 2024, the FirstFire Defendants filed their opening memorandum of law in support of their motion to dismiss.

Shortly thereafter,

the Company opposed the FirstFire Defendants’ motion and the FirstFire Defendants filed their reply in further support.

of the date hereof, the Court has not scheduled oral arguments on the FirstFire Defendants’ motion to dismiss or rendered its decision

The Company remains committed to actively litigating its claims for relief against the FirstFire Defendants.

Inc., et al v.

Crown Bridge Partners, LLC, et al

or about September 23, 2022, the Company, Social Life Network, Inc.

and Redhawk Holdings Corp.

commenced an action against Crown Bridge

Partners, LLC (“ Crown Bridge ”) and its control persons, Soheil Ahdoot and Sepas Ahdoot (collectively, the “ Crown

Bridge Defendants ”) in the United States District Court for the Southern District of New York.

The complaint alleges that the

Crown Bridge Defendants are liable to each of the plaintiffs for damages pursuant to RICO.

or about September 29, 2023, the Court granted the Crown Bridge Defendants’ motion to dismiss the plaintiffs’ complaint.

October 23, 2023, the plaintiffs appealed the Court’s decision to the United States Court of Appeals for the Second Circuit (“ Second

August 19, 2024, the Second Circuit issued its decision and found that the District Court erred when granting the Crown Bridge Defendants’

motion to dismiss.

As a result, the Second Circuit vacated the District Court’s decision and remanded the case back to the District

Court for further proceedings consistent with its decision.

September 30, 2024, the District Court entered a scheduling order, setting forth deadlines for discovery and dispositive motion practice.

Company is actively litigating its claims for relief against the Crown Bridge Defendants.

Capital Partners, LLC v.

On or about December 11, 2023, the Minnesota State

Court ruled in the Company’s favor on its motion for summary judgment on its (a) Exchange Act defense, holding that (1) More is

a “dealer” under the Exchange Act in violation of the mandatory registration requirement imposed thereby, and (ii) all contracts

between the parties are void, and (b) Minnesota Securities Act counterclaims against More and awarded damages for More’s violation

§ 80A.76(d) in the amount of $300,809.39, attorney’s fees in the amount of $110,029.00 and costs in the amount

of $210.25 (or a total award in the amount of $412,048.64).

The final judgment remains unsatisfied by More.

DarkPulse intends to continue to exercise all legal rights and remedies available to it to collect the amounts awarded should More fail

to voluntarily pay the same.

Carebourn Capital et al v.

Standard Registrar

and Transfer et al

On or about May 20, 2022, the Carebourn Capital,

(“Carebourn”) and More Capital, LLC (“More,” and together with Carebourn, the “Noteholders”)

commenced an action against the Company, certain members of the Company’s executive team and board of directors and Standard Registrar

and Transfer Company, Inc., the Company’s transfer agent, in the United States District Court for the District of Utah.

The Noteholders’

complaint alleged various causes of action arising from certain securities purchase agreements and convertible promissory notes the Company

sold to the Noteholders.

On or about November 1, 2023, the Noteholders

moved to dismiss the action.

On or about November 2, 2023, the Company moved

for sanctions against the Noteholders and their counsel of record.

On or about December 4, 2023, the Court entered

an order granting dismissal of the Noteholders’ claims with prejudice.

The Court acknowledged that notwithstanding its dismissal

of the Noteholders’ claims, the Court continues to retain jurisdiction over the Noteholders because of DarkPulse’s pending

motion for sanctions against the Noteholders and their attorneys.

On September 10, 2024, the Court entered an order

granting in part the Company’s motion for sanctions against the Noteholders and their counsel of record.

As of the date hereof, the Court has not yet rendered

its decision on the amount sanctions that will be imposed against the Noteholders and their counsel of record and awarded to the Company.

DarkPulse, Inc.

June 2, 2023, GS Capital Partners, LLC (“ GS Capital ”) commenced an action in the Supreme Court for New York County

against the Company through the filing of motion for summary judgment in lieu of a complaint.

The motion claims that the Company is in

breach of a convertible promissory note, dated July 14, 2021, and accompanying securities purchase agreement, dated the same.

motion claims that GS Capital is entitled to an award of $2,407,671, plus prejudgment interest and attorney’s fees, costs and disbursements.

July 27, 2023, the Company moved to set aside the default judgment entered in favor of GS Capital and against the Company on July 25,

GS Capital’s opposition thereto is due on or before August 31, 2023.

Thereafter, DarkPulse’s reply is due on or before

September 6, 2023.

Oral arguments are currently not scheduled on the Company’s motion.

or about September 27, 2023, the Company and GS Capital confidentially settled the dispute.

On or about October 3, 2023, the parties

filed a stipulation with the court to vacate the judgment entered against the Company and in favor of GS Capital, vacate the motion filed

by the Company, and discontinue the action.

or about October 9, 2023, the court vacated the judgment and the action was dismissed.

Company defaulted upon the settlement and, on July 24, 2024, the Company and GS Capital entered into a Settlement Agreement pursuant

to which the Company entered into a confession of judgment in favor of GS Capital in the amount of $2,673,423.19 (the “ Balance ”).

Upon approval of the court on August 19, 2024, the Company will issue to GS Capital free-trading and unrestricted shares of Common Stock

pursuant to drawdown requests in the amounts determined by GS Capital, subject to a 4.99% beneficial ownership limitation.

will be issued a price per share equal to the average of the three lowest VWAPs for the five prior trading days.

GS Capital will be allowed

to sell, the greater of (1) in one week, no more than 1% of the total outstanding shares of the Company on a non-cumulative basis at

the “ask” price, and (2) 15% of the daily trading volume of the Common Stock on any single trading day.

Each drawdown will

reduce the Balance.

The Company is required to reserve 2,500,000,000 shares of Common Stock.

West, Inc v Thomas J McCarthy Family Limited Partnership

or about July 25, 2023, TJM West filed an action in Maricopa court against its landlord for illegal lockout from the company’s

or about August 18, 2023, TJM West’s motion for Temporary Restraining Order was granted.

27, 2023, TJM West counsel motion to withdraw was accepted.

or about October 6, 2923, TJM West hired new counsel to assist with a short deadline to file answers to landlords motion.

or about November 6, 2023, TJM West and its counsel mutually agreed to a withdrawal.

or about November 6, 2023, TJM West engaged new counsel.

or about May 8, 2024, TJM West dropped its motion for Temporary Restraining Order.

or about May 24, 2024, TJM West counsel filed motion to continue discovery.

or about May 24, 2024, TJM West’s counsel left the firm handling the litigation it was determined in the best interest of the company

to terminate its relationship with the law firm.

As of the date hereof, the Company is interviewing new counsel and evaluating its claims

against landlord to determine if it’s financially responsible to incur additional fees related to exercising TJM’s rights

against the landlord for terminating the lease.

or about June 28, 2024, the Company discussed with possible new counsel the feasibility of recovering its damages utilizing the courts.

At that time, it appeared the cost of recovery would exceed the recoverable amount should the Company be successful in its litigation.

TJM West is awaiting updates from the court in Maricopa County as to the status of the case.

facilities in question had served as TJM West’s manufacturing facility and is located at 2640 W Medtronic Way Tempe, AZ 85281.

Currently, we do not have access to the facility nor have we signed a new lease signed with the landlord.

addition to the foregoing Legal Proceedings, we are also actively investigating potential legal claims, including but not limited to

stock fraud, market manipulation, and/or defamation, against certain Twitter accounts, websites, and social media channels.

The investigation

is ongoing and should potential claims be identified, we will evaluate commencing formal litigation proceedings.

time to time, we may become involved in litigation relating to claims arising out of our operations in the normal course of business.

We are not currently involved in any pending legal proceeding or litigation and, to the best of our knowledge, no governmental authority

is contemplating any proceeding to which we are a party or to which any of our properties is subject, which would reasonably be likely

to have a material adverse effect on our business, financial condition and operating results.

NOTE 17 – RELATED PARTY TRANSACTIONS

The Company follows subtopic 850-10 of the FASB

Accounting Standards Codification for the identification of related parties and disclosure of related party transactions.

Section 850-10-20 the related parties include a) affiliates of the Company;

b) Entities for which investments in their equity securities

would be required, absent the election of the fair value option under the Fair Value Option Subsection of Section 825-10-15, to be accounted

for by the equity method by the investing entity;

c) trusts for the benefit of employees, such as pension and profit- sharing trusts

that are managed by or under the trusteeship of management;

FirstFire Global Opportunities

Fund, LLC, and Eli Fireman

On or about December 31, 2021, the Company commenced

an action against FirstFire Global Opportunities Fund, LLC (“FirstFire”) and its control person, Eli Fireman (“Fireman,”

and together with FirstFire, the “FirstFire Defendants”), in the United States District Court for the Southern District of

On or about May 5, 2022, the Company amended its

complaint against the FirstFire Defendants.

The amended complaint alleges that the FirstFire Defendants were liable to the Company for

rescission of certain convertible promissory notes and transitions effected thereunder and damages pursuant to the Racketeer Influenced

and Corrupt Organizations Act (“RICO”).

On or about January 17, 2023, the Court granted the FirstFire Defendants’ motion

to dismiss the Company’s operative pleading.

Later on the same day, the Company appealed the Court’s decision to the United

States Court of Appeals for the Second Circuit (“Second Circuit”).

On March 28, 2024, the Second Circuit issued its

decision and found that the District Court (a) properly found that the Delaware forum-selection clause was enforceable but, thereafter,

(b) improperly made a ruling on the merits of the Company’s claims for relief.

As a result, the Second Circuit affirmed the District

Court’s decision in part, vacated in part and remanded the case back to the District Court for transferring to the United States

District Court for the District of Delaware.

On September 9, 2024, the FirstFire Defendants

filed their opening memorandum of law in support of their motion to dismiss.

Shortly thereafter, the Company opposed the FirstFire Defendants’

motion and the FirstFire Defendants filed their reply in further support.

As of the date hereof, the Court has not scheduled

oral arguments on the FirstFire Defendants’ motion to dismiss or rendered its decision thereon.

The Company remains committed to

actively litigating its claims for relief against the FirstFire Defendants.

DarkPulse, Inc., et al v.

Crown Bridge Partners,

On or about September 23, 2022, the Company, Social

Life Network, Inc.

and Redhawk Holdings Corp.

commenced an action against Crown Bridge Partners, LLC (“Crown Bridge”) and

its control persons, Soheil Ahdoot and Sepas Ahdoot (collectively, the “Crown Bridge Defendants”) in the United States District

Court for the Southern District of New York.

The complaint alleges that the Crown Bridge Defendants are liable to each of the plaintiffs

for damages pursuant to the Racketeer Influenced and Corrupt Organizations Act (“RICO”).

On or about September 29, 2023, the Court granted

the Crown Bridge Defendants’ motion to dismiss the plaintiffs’ complaint.

On October 23, 2023, the plaintiffs appealed the

Court’s decision to the United States Court of Appeals for the Second Circuit (“Second Circuit”).

On August 19, 2024, the Second Circuit issued

its decision and found that the District Court erred when granting the Crown Bridge Defendants’ motion to dismiss.

the Second Circuit vacated the District Court’s decision and remanded the case back to the District Court for further proceedings

consistent with its decision.

On September 30, 2024, the District Court entered

a scheduling order, setting forth deadlines for discovery and dispositive motion practice.

Pursuant to the scheduling in effect as of the

date hereof, the Company’s Motion for Summary Judgment and the Crown Bridge Defendants’ Motion to Dismiss will both be fully

submitted to the Court on July 16, 2025.

In addition to the foregoing Legal Proceedings,

we are also actively investigating potential legal claims, including but not limited to stock fraud, market manipulation, and/or defamation,

against certain Twitter accounts, websites, and social media channels.

The investigation is ongoing and, should potential claims be identified,

we will evaluate commencing formal litigation proceedings.

From time to time, we may become involved in litigation

relating to claims arising out of our operations in the normal course of business.

We are not currently involved in any pending legal

proceeding or litigation and, to the best of our knowledge, no governmental authority is contemplating any proceeding to which we are

a party or to which any of our properties is subject, which would reasonably be likely to have a material adverse effect on our business,

financial condition and operating results.

NOTE 16 – RELATED PARTY

The Company follows subtopic 850-10

of the FASB Accounting Standards Codification for the identification of related parties and disclosure of related party transactions.

Pursuant to Section 850-10-20 the related parties include a) affiliates of the Company;

b) Entities for which investments in their equity

securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of Section 825-10-15,

to be accounted for by the equity method by the investing entity;

c) trusts for the benefit of employees, such as pension and profit-

sharing trusts that are managed by or under the trusteeship of management;

d) principal owners of the Company;

e) management of the Company;

parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of

the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests;

f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies

of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests;

Other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership

2 unchanged sentences

The financial statements shall include disclosures of material

related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course

related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of

However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements

9 unchanged sentences

as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.

On January 20, 2025 Optilan India Pvt, Ltd.entered

into a director’s loan agreement to lend funds whenever the company requires money for working capital over the period of two years.

On January 20, 2025, Optilan India Pvt,

entered into a director’s loan agreement to lend funds whenever the company requires money for working capital over the period

of two years.

The loan is unsecured, and non-interest bearing with repayment being mutually agreed upon between Lender and Borrower.

Remote Intelligence and Wildlife Specialists

Loan Payables

Remote Intelligence and Wildlife

Specialists Loan Payables

RI has a loan payable with the former

majority shareholder, who is a shareholder in the Company after the acquisition of 60% of RI’s membership interests.

is unsecured, non-interest bearing and due on demand.

As of both three months ended March 2025 and 2024, the outstanding balance was

unsecured, non-interest bearing and due on demand.

As of both six months ended June 30 2025 and 2024, the outstanding balance was $ 226,247 .

WS has a loan payable with the former

majority shareholder, who is a shareholder in the Company after the acquisition of 60% of WS’s membership interests.

is unsecured, non-interest bearing and due on demand.

As of both three months ended March 2025 and 2024, the outstanding balance was

unsecured, non-interest bearing and due on demand.

As of both six months ended June 30, 2025 and 2024, the outstanding balance was $ 135,500 .

NOTE 17 – SUBSEQUENT EVENTS

On April 4, 2025, the Company issued 130,615,137

shares of common stock for a total consideration of $41,796.85

On April 14, 2025, the Company issued 179,014,375

shares of common stock for a total consideration of $42,963.45

On April 23, 2025, the Company issued 181,334,313

shares of common stock for a total consideration of $58,026.98

On May 1, 2025, the Company issued 188,280386

On July 2, 2025, the Company issued

231,597,125 shares of common stock for a total consideration of $37,055.54.

On May 9, 2025, the Company issued 225,384,480

On July 21, 2025, the Company issued

273,712,125 shares of common stock for a total consideration of $43,793.94.

On July 14, 2025, the company issued 211,638,462 shares of

common stock for conversion of a promissory note dated November 20, 2024.

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