What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-03-18 compared with 2025-03-31 · 309 added, 358 removed, 144 unchanged (82% of the section changed)

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financial statements and related notes included elsewhere in this Annual Report on Form 10-K.

The following discussion and analysis should

also be read together with the section entitled “Organization and description of business” as of December 31,2024 and 2023

(Successor) and for the period from January 1, 2023 through December 29, 2023 (Predecessor).

In addition to historical information,

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August 6, 2024, The Nasdaq Stock Market granted our application for listing on the Nasdaq.

May 29, 2025, the Company acquired Takeout7 Inc.

Takeout7 is a restaurant technology company offering comprehensive online ordering solutions

through its TakeOut7 platform and AI-powered digital marketing services through its Platr platform.

The acquisition of Takeout7 expands

the Company’s technology offerings to include end-to-end solutions for independent restaurants.

In early 2026, Takeout7 and its

operations were merged into our subsidiary, Restaurant.com, Inc.

August 18, 2023, we entered into an agreement and plan of merger to acquire CardCash Exchange Inc (“CardCash”).

29, 2023, the merger was completed and has been accounted for as a business combination using the acquisition method of accounting.

was formed in 2013 and purchases merchant gift cards and resells them at a markup.

29, 2023, the merger was completed and accounted for as a business combination under the acquisition method.

CardCash was formed in 2013

and purchases merchant gift cards and resells them at a markup.

March 1, 2020, we acquired the assets of Restaurant.com, Inc., a pioneer in the restaurant deal space and the nation’s largest

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have two principal divisions, B2C and B2B, for both CardCash and for Restaurant.com.

operates as a leading gift card exchange platform, facilitating the purchase and sale of unwanted gift cards at discounted rates for

both consumers and businesses.

The Company’s mission is to provide a seamless marketplace for individuals looking to maximize the

value of their gift cards while also offering businesses innovative solutions to leverage this market.

core service offering includes the buying and selling of gift cards from over 1,100 retailers, such as Target, Home Depot, Starbucks

and TJ Maxx, among others.

By connecting buyers and sellers, CardCash enables consumers to unlock value from unused gift cards and save

significant amounts on their purchases.

purchases unwanted gift cards at a value lower than their face worth and subsequently retails them at a discounted rate to discerning

shoppers nationwide.

This avenue not only allows individuals to obtain cash for their unneeded gift cards but also enables them to make

cost-effective purchases through discounted gift cards.

advanced fraud prevention technology, known as FraudFix, CardCash ensures the security and integrity of all transactions conducted on

its platform.

This commitment to trust and reliability has contributed to its success in saving consumers over $100 million since its

is a leading gift card exchange platform that facilitates the purchase and sale of unwanted gift cards at discounted rates for consumers

and businesses.

The Company’s mission is to provide a seamless marketplace for individuals looking to maximize the value of their

gift cards while also offering businesses innovative solutions to leverage this market.

core service offering includes buying and selling gift cards from over 1,100 retailers, including Target, Home Depot, Starbucks, and

By connecting buyers and sellers, CardCash enables consumers to unlock value from unused gift cards and save significant amounts

on their purchases.

purchases unwanted gift cards at a discount to their face value and resells them at a discount to discerning shoppers nationwide.

avenue not only allows individuals to redeem unwanted gift cards for cash but also enables them to make cost-effective purchases with

discounted gift cards.

advanced fraud-prevention technology, FraudFix, CardCash ensures the security and integrity of all transactions on its platform.

commitment to trust and reliability has contributed to its success in saving consumers over $100 million since its inception.

Restaurant.com

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B2C division accounted for approximately 15% of gross revenue in our fiscal year ended December 31, 2025.

To our database of 6.2 million customers,

To our database of 6.2 million

customers, we sell:

Discounted certificates for 10,000 restaurants.

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theatre, movies, wine, and travel.

Customers have favored these bundled offering (“Specials”), generating significantly greater

revenue per customer when compared to purchasing our other products.

The average order value for these Specials sales is nearly five

times a certificate purchase.

Customers have favored these bundled offerings (“Specials”), generating significantly

higher revenue per customer than purchasing our other products.

The average order value for these Specials sales is nearly five times

that of a certificate purchase.

Specials generated over 5% of our past year’s B2C revenue from 60% of the B2C orders for the fiscal

year ended December 31, 2023.

We believe that our relationships with small businesses presents a significant revenue opportunity through

We believe that our relationships with small businesses present a significant revenue opportunity through

such cross-promotions.

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B2B division accounted for approximately 85% of our gross revenue in our fiscal year ended December 31, 2025.

We sell certificates and Discount Dining

Passes to corporations and marketers, which use them to:

generate new customers;

increase sales at the point of sale;

reward points/customer loyalty;

convert to paperless billing and auto-bill payment.

motivate specific customer behavior such as free home

repair estimates and test drives for auto dealers;

renew subscriptions and memberships;

address customer service issues.

We sell certificates and

Discount Dining Passes to corporations and marketers, which use them to:

new customers;

sales at the point of sale;

points/customer loyalty;

to paperless billing and auto-bill payment.

specific customer behavior, such as free home repair estimates and test drives for auto dealers;

subscriptions and memberships;

customer service issues.

Restaurant.com

Other Business

also generate revenue through third-party offers and display ad revenue.

also generate revenue from third-party offers and display ads.

This comprises a de minimis portion of our gross revenue.

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Attractive Customer Demographics

intend to grow and leverage our customer database of 6.2 million which we believe is of value to merchants for a variety of services

and products.

intend to grow and leverage our 6.2 million customer database, which we believe is valuable to merchants for a variety of services and

March 2020, the World Health Organization declared COVID-19 a global pandemic.

This contagious disease outbreak, adversely affected work

forces, economies and financial markets globally.

The outbreak has negatively impacted our revenues as a result of the temporary closures

of restaurants throughout the United States where our discount certificates and Discount Dining Passes were accepted and where dining

was being restricted to outdoor locations or to capacity constraints for indoor dining.

Our revenues from purchase of our discount certificates

in 2020, 2021 and 2022 declined since they could only be redeemed when dining in the restaurants and also were not accepted for payment

by third-party platforms that facilitated ordering and delivery of food on-demand.

As the COVID-19 pandemic has abated, our revenues

improved in fiscal 2023.

inflation also increased during 2021 and in 2022.

The Russia and Ukraine conflict and other geopolitical conflicts, as well as related

international response, have exacerbated inflationary pressures, including causing increases in the price for goods and services and

global supply chain disruptions, which have resulted and may continue to result in shortages in food products, materials and services.

Such shortages have resulted and may continue to result in inflationary cost increases for labor, fuel, food products, materials and

services, and could continue to cause costs to increase as well as result in the scarcity of certain materials.

We cannot predict any

future trends in the rate of inflation or other negative economic factors or associated increases in our operating costs and how that

may impact our business.

To the extent we and the restaurant customers we service are unable to recover higher operating costs resulting

from inflation or otherwise mitigate the impact of such costs on our and their business, our revenues and gross profit could decrease,

and our financial condition and results of operations could be adversely affected.

This contagious disease outbreak adversely affected workforces,

economies, and financial markets globally.

The outbreak has negatively impacted our revenues due to temporary restaurant closures across

the United States, where our discount certificates and Discount Dining Passes were accepted, and where dining was restricted to outdoor

locations or to capacity limits for indoor dining.

Our revenues from the purchase of our discount certificates in 2020, 2021, and 2022

declined since they could only be redeemed when dining in the restaurants and also were not accepted for payment by third-party platforms

that facilitated ordering and delivery of food on demand.

As the COVID-19 pandemic has abated, our revenues improved in fiscal 2023.

We Measure Our Business

use operating metrics to assess our business’s progress and make strategic decisions.

Certain financial metrics are reported in

accordance with GAAP, and others are non-GAAP financial measures.

As our business evolves, we may update the key financial and operating

metrics we use to measure our performance.

For further information and reconciliations to the most applicable financial measures under

GAAP, refer to our discussion under the Non-GAAP Financial Measures section.

billings are the total dollar value of customer purchases of goods and services.

Gross billings are presented net of customer refunds

and order discounts.

A significant portion of our revenue consists of sales of discounted merchant gift cards, in which we collect

the transaction price from the customer and remit a portion to the third-party suppliers who will provide the related goods or services.

For these transactions, gross billings differ from Net Sales reported in our Consolidated Statements of Operations, which

is presented net of the merchant’s share of the transaction price.

Gross billings are an indicator of our growth and business

performance, as they measure the dollar volume of transactions generated through our marketplaces.

Tracking gross billings also allows

us to monitor the percentage of gross billings we retain after merchant payments.

reconciliation of our net sales (as reported) to our gross billings for the years ended December 31, 2025 and 2024 were as follows:

Net sales (as reported)

Company costs of Agent Transactions (see discussion below)

Gross billings

$ 154,707,400

$ 121,689,314

Russia and Ukraine conflict and other geopolitical conflicts, as well as related international response, have exacerbated inflationary

pressures, including causing increases in the price for goods and services and global supply chain disruptions, which have resulted and

may continue to result in shortages in food products, materials and services.

Such shortages have resulted and may continue to result

in inflationary cost increases for labor, fuel, food products, materials and services, and could continue to cause costs to increase

as well as result in the scarcity of certain materials.

We cannot predict future trends in inflation or other negative economic factors,

or the associated changes in our operating costs, and how these may impact our business.

To the extent we and the restaurant customers

we service are unable to recover higher operating costs resulting from inflation or otherwise mitigate the impact of such costs on our

and their business, our revenues and gross profit could decrease, and our financial condition and results of operations could be adversely

Company has a history of reporting net losses.

At December 31, 2024, the Company had cash of $3,574,876 available to fund its operations,

including expansion plans, and to service its debt, and a negative working capital of $3,204,077.

As of December 31, 2025, the Company had $3,654,944 in cash available to fund its operations,

including expansion plans, and to service its debt, and working capital of $249,223.

consolidated financial statements have been presented on the basis that it will continue as a going concern, which contemplates the realization

of assets and satisfaction of liabilities in the normal course of business.

We have experienced operating losses and negative operating

cash flows during 2024 and 2023.

We have financed our working capital requirements through borrowings from various sources and the sale

of our equity securities.

a result, management has concluded that there is substantial doubt about our ability to continue as a going concern.

The Company’s

independent registered public accounting firm, in its report on the Company’s consolidated financial statements for the year ended

December 31, 2024, has also expressed substantial doubt about the Company’s ability to continue as a going concern.

We incurred operating losses and negative operating cash

flows in 2025 and 2024.

We have financed our working capital requirements through borrowings from various sources and the sale of our

equity securities.

As a result, management has concluded, and our independent registered public accounting firm has agreed with our

conclusion that there is a substantial doubt regarding our ability to continue as a going concern for a period of at least 12 months beyond

the filing of this Annual Report on Form 10-K.

The report of our independent registered public accounting firm on our financial statements

for the year ended December 31, 2025, includes an explanatory paragraph regarding the existence of substantial doubt about our ability

to continue as a going concern.

The Company’s

consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Company’s ability to continue as a going concern is dependent upon its ability to raise additional debt or equity capital to fund

its business activities and to ultimately achieve sustainable operating revenues and profitability.

Company’s ability to continue as a going concern depends on its ability to raise additional debt or equity capital to fund its

business activities and ultimately achieve sustainable operating revenues and profitability.

market conditions present uncertainty as to the Company’s ability to secure additional funds, there can be no assurances that the

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be required to scale back its business activities or to discontinue its operations entirely.

of Presentation

August 18, 2023, Giftify, Inc.

into an agreement and plan of merger to acquire CardCash Exchange Inc (“CardCash”).

On December 29, 2023, the merger was

Giftify’s operations are not considered significant compared to the operations of CardCash before the acquisition.

for the purpose of the accompanying consolidated financial statements, periods before December 29, 2023 reflect the financial position,

results of operations and cash flows of CardCash prior to the acquisition, and is referred to as the “Predecessor”.

beginning after December 29, 2023 reflect the financial position, results of operations and cash flows of Giftify consolidated with CardCash,

and is referred to as the “Successor”.

A black-line between the Successor and Predecessor periods has been placed in the

consolidated financial statements and in the tables to the notes to the consolidated financial statements to highlight the lack of comparability

between these periods.

Collectively, Giftify (Successor) and CardCash (Predecessor) are referred to as the “Company”.

recognize revenue in accordance with FASB ASC 606, Revenue from Contracts with Customers .

Based on the Company’s business

model, it is sometimes necessary to determine whether we are acting as a principal or an agent in revenue-generating arrangements.

whether the Company is a principal or an agent requires significant judgment and analysis.

This is particularly true when evaluating

factors such as responsibility for fulfilling the customer promise, inventory risk, and pricing discretion.

Changes in the assessment

of these indicators could materially impact reported revenue and related metrics.

The Company continuously evaluates our judgments and

estimates to ensure accurate revenue recognition in accordance with ASC 606.

following table reconciles the recording of the Company’s gross vs.

net transactions to the Company’s reported net sales.

Gross revenue (Principal Transactions)

Net revenue (Agent Transactions)

increase in net revenue recognized as agent increased $2,742,407, or 126.1%, during the year ended December 31, 2025, as compared to

the prior year period.

The increase over the previous year was due to the sale of cruise-line-related gift cards, fluctuations in the

types of gift cards sold, and changes in the number of customer orders in which the Company acted as an agent.

of Operations – Year Ended December 31, 2025, Compared to Year Ended December 31, 2024

AND SUBSDIARIES (FKA RDE, INC.)

gross billings for the year ended December 31, 2025 and 2024 were as follows:

Year Ended December 31,

Gross billings

$ 154,707,400

$ 121,689,314

billings increased 27.1% during the year ended December 31, 2025, as compared to the prior year period.

A significant portion of our

revenue comes from discounted merchant gift card sales, in which we collect the transaction price from the customer and remit a portion

to third-party suppliers of the related goods or services.

For these transactions, gross billings differ from the Net Sales reported

in our Consolidated Statements of Operations, which reflect only the fees and commissions we retain from the sale of discounted merchant

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

Year Ended December 31,

Cost of sales

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Selling, general and administrative expenses

Amortization of capitalized software costs

Depreciation of capitalized software costs

Amortization of intangible assets

Impairment of property and equipment

Impairment of intangibles

Total operating expenses

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(10,354,746 )

Other income (expense):

(18,375,726 )

Other expense:

Interest income

Interest expense

Financing costs

Gain on forgiveness of debt

Total other income (expense), net

Net loss before income taxes

Total other expense, net

Net loss before income tax benefit

(11,000,454 )

Income taxes (expense) benefit

Income tax benefit

$ (10,491,658 )

$ (18,832,080 )

the year ended December 31, 2023, the Company’s operating revenues consisted of sales generated by our CardCash business.

Basis of Presentation discussion above.

Restaurant.com

for the year ended December 31, 2024 and 2023, were $86,991,638 and $87,146,804, respectively.

During the current year period, we focused

on improving our gross margin.

We assessed the quality of our purchased gift card brands, allowing us to increase the sales price to

our customers, resulting in a gross margin of 13.0%, as compared to a gross margin of 12.0% in the prior year period, which generated

an increase in gross profit as compared to the prior year period.

Restaurant.com

for the year ended December 31, 2024 were $1,942,399.

Per our Basis of Presentation discussion above, Restaurant.com sales were not included

in the prior year numbers.

December 31, 2024

December 30, 2023 to

December 31, 2023

January 1, 2023 to

December 29, 2023

Restaurant.com

Cost of Sales

the year ended December 31, 2023, the Company’s cost of sales consisted of solely our CardCash business.

See our Basis of Presentation

discussion above.

Amortization of developed technology is excluded from cost of sales and included in amortization expense in the Statements

of Operations.

following is a discussion of our results of operations.

sales for the year ended December 31, 2025 and 2024, were $83,181,716 and $88,934,036, respectively, a decrease of 6.5%.

in net sales was due to the change in the mix of agent versus principal transactions as discussed above.

Merchant gift card sales accounted

for approximately 97% and 98% of our net sales for the year ended December 31, 2025 and 2024, respectively.

of sales consists primarily of the cost to purchase merchant gift cards.

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were $67,686,362 and $75,789,255, respectively.

Our cost of sales declined 1.3%, which generated an increase in gross margin of $829,139,

or 7.9%, as compared to the prior year period.

Our cost of sales, as a percentage of sales, were 87.0% and 87.9%, for the year ended

December 31, 2024 and 2023, respectively.

Restaurant.com

of sales for the year ended December 31, 2024 were $134,565.

Per our Basis of Presentation discussion above, Restaurant.com sales were

not included in the prior year numbers.

December 31, 2024

Selling, general and administrative expenses

Amortization of capitalized software costs

Amortization of intangible assets

Impairment of property and equipment

Impairment of intangibles

Operating expenses

general and administrative expenses .

Gross profit increased $2,350,573, or 17.9%, as compared to the prior year period.

gross margin, as a percentage of net sales, were 18.6% and 14.8% for the year ended December 31, 2025, and 2024, respectively.

margin was positively impacted by the increase in net revenue (agent transactions) described above, compared with the prior-year period.

general, and administrative expenses consist of costs incurred to identify, communicate with, and evaluate potential customers and related

business opportunities, and compensation to officers and directors, as well as legal and other professional fees, lease expense, and

other general corporate expenses.

Management expects selling, general and administrative expenses to increase in future periods as the

Company adds personnel and incurs additional costs related to its operation as a public company, including higher legal, accounting,

insurance, compliance, compensation and other costs.

general and administrative expenses were $27,615,865 for the year ended December 31, 2024, as compared to $16,238,938 for the year

ended December 31, 2023, an increase of $11,376,927.

The increase was from increased stock-based compensation expense of $6,482,766

during the year ended December 31, 2024, increased payroll and benefit expenses, and general changes in our business and operations.

For the period January 1, 2023 to December 29, 2023, selling, general and administrative expenses of Giftify were excluded.

Basis of Presentation discussion above.

business opportunities;

compensation to officers and directors;

legal and other professional fees;

lease expense;

and other general corporate

Management expects selling, general, and administrative expenses to increase in future periods as the Company adds personnel

and incurs additional costs related to its operation as a public company, including higher legal, accounting, insurance, compliance,

compensation, and other costs.

general and administrative expenses were $22,933,052 for the year ended December 31, 2025, as compared to $27,615,865 for the year ended

December 31, 2024, a decrease of $4,682,813.

The decrease was due to a $5,182,023 reduction in stock-based compensation expense during

the year ended December 31, 2025, partially offset by increases in payroll and benefits expenses, marketing and advertising costs, and

other general expenses to support our business.

of capitalized software costs .

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Amortization expenses

were $2,431,668 during the year ended December 31, 2024.

Amortization expenses were $300,000 during the year ended December 31, 2023.

of property and equipment.

the year ended December 31, 2023, the Company determined that certain property and equipment were impaired, resulting in a charge to

operations of $738,740 at December 31, 2023.

No similar event occurred in the current year period.

of intangibles

the year ended December 31, 2023, the Company determined that certain intangible assets were impaired, based on a third-party valuation,

resulting in a charge to operations of $250,000 at December 31, 2023.

No similar event occurred in the current year period.

were $2,271,673 during the year ended December 31, 2025, as compared to amortization expenses of $2,431,668 during the year ended December

from Operations

December 31, 2024

Loss from operations

$ (18,375,726 )

$ (5,020,000 )

$ (3,080,406 )

the year ended December 31, 2024, we incurred a loss from operations of ($18, 375,726 ), as compared to a loss from operations of ($8,100,406)

for the year ended December 31, 2023.

The increase in loss from operations was due to our increased gross profit offset by increased

stock-based compensation expense, impairment of goodwill and intangible assets, and operating costs, as discussed above.

For the period

January 1, 2023 to December 29, 2023, operations of Giftify were excluded.

See our Basis of Presentation discussion above.

Income (Expenses)

December 31, 2024

December 30, 2023 to

December 31, 2023

January 1, 2023 to

December 29, 2023

Interest expense

$ (1,002,354 )

$ (2,890,466 )

Financing costs

Gain on forgiveness of debt

Total other income (expense), net

$ (1,133,354 )

had other expenses of ($1,133,354) for the year ended December 31, 2024, as compared to other income of $2,985,534 for the year ended

December 31, 2023.

Other expense income for the year ended December 31, 2024, consisted of financing costs of $131,000 and interest expense

of $1,002,354.

Other income for the year ended December 31, 2023, consisted of a gain from the forgiveness of convertible notes and promissory

notes totaling $5,876,000, offset by interest expense of $2,890,466.

the year ended December 31, 2025, we incurred a loss from operations of $10,354,746, compared with $18,375,726 for the year ended December

The decrease in loss from operations was due to our increased gross profit offset by decreased stock-based compensation expense,

as discussed above.

Expenses, Net

the year ended December 31, 2025, we incurred interest expense, net of $604,759, as compared to interest expense, net of $1,002,354 for

the year ended December 31, 2024.

The decrease in interest expense was due to our decreased debt balances.

We recorded financing costs

of $95,000 for the year ended December 31, 2025 as compared to $131,000 for the prior year period.

Lastly, we recorded additional income

of $38,540 for the year ended December 31, 2025, which did not occur in the prior year period.

the year ended December 31, 2025, we recognized an income tax benefit of $508,796, compared with $677,000 for the year ended December

realized a net loss of $10,491,658 for the year ended December 31, 2025, as compared to a net loss of $18,832,080 for the year ended

December 31, 2024.

$ (18,832,080 )

$ (5,020,000 )

realized a net loss of ($18,832,080) for the year ended December 31, 2024, as compared to a net loss of ($5,144,546) for the year

ended December 31, 2023 (including Predecessor from January 1, 2023 to December 29, 2023).

The increase in net loss was due to our increased gross profit offset by increased stock-based

compensation expense, operating costs, other expenses, and decreased income taxes, as discussed above.

addition to our GAAP results, we present Modified EBITDA as a supplemental measure of our performance.

However, Modified EBITDA is not

a recognized measurement under GAAP and should not be considered as an alternative to net income, income from operations or any other

performance measure derived in accordance with GAAP, or as an alternative to cash flow from operating activities as a measure of liquidity.

We define Modified EBITDA as net income (loss), plus interest expense, depreciation and amortization, stock-based compensation, and fair

value of common stock issued for services.

The decrease in net loss was driven by higher gross profit, lower stock-based compensation expense, and lower interest

expense, as discussed above.

Financial Measure - Modified EBITDA

addition to our GAAP results, we present Modified EBITDA as a supplemental performance measure.

However, Modified EBITDA is not a recognized

measurement under GAAP and should not be considered as an alternative to net income, income from operations or any other performance

measure derived in accordance with GAAP, or as an alternative to cash flow from operating activities as a measure of liquidity.

Modified EBITDA as net income (loss), plus interest expense, depreciation and amortization, stock-based compensation, and fair value

of common stock issued for services.

considers our core operating performance to be that which our managers can affect in any particular period through their management of

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December 31, 2025

December 31, 2024

$ (10,491,658 )

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Modified EBITDA adjustments:

Interest expense

Interest expense, net

Financing costs

Gain on forgiveness of debt

Amortization of intangible assets

Amortization of capitalized software costs

Loss on fair value of stock issued on vendor settlement

Bad debt expense

Stock option and other noncash compensation

Fair value of stock issued on vendor settlement

Impairment of intangible assets and property and equipment

Total Modified EBITDA adjustments

Mofified EBITDA

Modified EBITDA

$ (2,836,376 )

present Modified EBITDA because we believe it assists investors and analysts in comparing our performance across reporting periods on

a consistent basis by excluding items that we do not believe are indicative of our core operating performance.

In addition, we use Modified

EBITDA in developing our internal budgets, forecasts and strategic plan;

in analyzing the effectiveness of our business strategies in

evaluating potential acquisitions;

making compensation decisions;

and in communications with our board of directors concerning our financial

Modified EBITDA has limitations as an analytical tool, which includes, among others, the following:

present Modified EBITDA because we believe it helps investors and analysts compare our performance across reporting periods on a consistent

basis by excluding items we do not believe are indicative of our core operating performance.

In addition, we use Modified EBITDA to develop

our internal budgets, forecasts, and strategic plan;

to analyze the effectiveness of our business strategies and evaluate potential acquisitions;

to make compensation decisions;

and to communicate with our board of directors regarding our financial performance.

Modified EBITDA has

limitations as an analytical tool, which include, among others, the following:

EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments;

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the future, and Modified EBITDA does not reflect any cash requirements for such replacements.

Accounting Policies and Estimates

following discussion and analysis of financial condition and results of operations is based upon the Company’s consolidated financial

statements for the years ended December 31, 2024 and 2023 presented elsewhere in this report, which have been prepared in conformity

with accounting principles generally accepted in the United States of America (“GAAP”).

Certain accounting policies and estimates

are particularly important to the understanding of the Company’s financial position and results of operations and require the application

of significant judgment by management or can be materially affected by changes from period to period in economic factors or conditions

that are outside of the Company’s control.

As a result, these issues are subject to an inherent degree of uncertainty.

these policies, management uses its judgment to determine the appropriate assumptions to be used in the determination of certain estimates.

Those estimates are based on the Company’s historical operations, the future business plans and the projected financial results,

the terms of existing contracts, trends in the industry, and information available from other outside sources.

Company recognizes revenue in accordance with FASB ASC 606, Revenue from Contracts with Customers .

Company buys merchant gift cards from the general public and distributors at a discount and then resells them at a markup.

also derives revenue from the sale of discount certificates for restaurants on behalf of third-party restaurants.

and costs of sales are recognized when control of the products transfers to our customer, which generally occurs at a point in time when

the risk and title to the product transfers to the customer upon delivery to the customer.

The Company’s performance obligations

are satisfied at that time.

The Company’s standard terms of delivery are included in its contracts of sale, order confirmation

documents, and invoices.

The Company recognizes revenue on a gross basis for the sales price of the merchant gift cards and discount

certificates it collects.

Company periodically issues share-based awards to employees and non-employees and consultants for services rendered.

Stock options vest

and expire according to terms established at the issuance date of each grant.

Stock grants are measured at the grant date fair value.

Stock-based compensation cost is measured at fair value on the grant date and is generally recognized as a charge to operations ratably

over the requisite service, or vesting, period.

Recognition of compensation expense for non-employees is in the same period and manner

as if the Company had paid cash for the services.

and Business Combinations

Company allocates the fair value of purchase consideration to the tangible assets acquired, liabilities assumed, and separately identified

intangible assets acquired based on their estimated fair values.

The excess of the fair value of purchase consideration over the fair

values of these identifiable assets and liabilities is recorded as goodwill.

Such valuations require management to make significant estimates

and assumptions, especially with respect to intangible assets.

Significant estimates in valuing certain intangible assets include, but

are not limited to, future expected cash flows from, acquired technology, trademarks and trade names, useful lives, and discount rates.

Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and

unpredictable and, as a result, actual results may differ from estimates.

During the measurement period, which can be up to one year

from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed, with the corresponding

offset to goodwill.

Upon the conclusion of the measurement period, any subsequent adjustments are recorded in the consolidated statements

of operations.

Accounting Pronouncements

discussion of recent accounting pronouncements in Note 1 to the accompanying financial statements.

and Capital Resources

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our ability to continue as a going concern.

Going Concern

consolidated financial statements have been presented on the basis that it will continue as a going concern, which contemplates the realization

reflected in the accompanying financial statements, for the year ended December 31, 2025, the Company recorded a net loss of $10,491,658

and used cash in operations of $1,590,074.

Cash used in operations was primarily for working capital.

As of December 31, 2025, we had

a cash balance of $3,654,944.

Historically,

we have financed our operations through existing cash balances, public and private issuance of common stock, term loans, and credit lines

from financial institutions.

of the issuance date of the financial statements included in this Annual Report on Form 10-K, management expects that the Company’s

existing cash of $3,654,944 will last until December 2026.

address funding considerations, management periodically evaluates funding alternatives and may raise additional funds through equity

issuances, debt securities, strategic partner arrangements, strategic transactions, or credit from financial institutions.

additional financing, there is no assurance that such financing will be available to us on favorable terms, or at all.

Our ability to

obtain additional financing in the debt and equity capital markets is subject to several factors, including market and economic conditions,

our performance, and investor sentiment regarding us and our industry.

are also continuing to take actions to improve the Company’s operating performance and cash generated from operations, including

product optimization, sales growth strategies, operational streamlining, negotiating equitable vendor contracts, and managing product

However, we may be unable to execute these actions in a timely manner, or at all.

the Company is unable to raise additional capital whenever necessary or otherwise improve its operating performance or generation of

cash from operations, it may be forced to decelerate or curtail certain of its operations until such time as additional capital becomes

consolidated statements of cash flows as discussed herein are presented below.

December 31, 2025

December 31, 2024

Net cash used in operating activities

$ (1,590,074 )

$ (3,407,539 )

Net cash provided by (used in) investing activities

Net cash provided by financing activities

Net increase (decrease) in cash and cash equivalents

$ (1,380,530 )

provided by or used in operating activities primarily consists of net loss adjusted for certain non-cash items, including amortization

of intangible assets, impairment of intangible assets, gain on forgiveness of government assistance notes payable, and the fair value

of common stock issued for directors, employees, and service providers, and the effect of changes in working capital and other activities.

used in operating activities for the year ended December 31, 2025 was $1,590,074 and consisted of our net loss, adjusted for non-cash

items, including amortization of intangible assets, the fair value of vested stock options, common stock issued to executives, employees,

and advisors, and routine changes in working capital and other activities.

used in operating activities for the year ended December 31, 2024 was approximately $3,407,539 and consisted of our net loss, adjusted

for non-cash items, including amortization of intangible assets, fair value of vested stock options, and the fair value of common stock

issued to executives, employees, and advisors, and routine changes in working capital and other activities.

provided by investing activities for the year ended December 31, 2025 was $109,543, which was from cash received on an acquisition.

had no cash flows from investing activities for the year ended December 31, 2024.

provided by financing activities for the year ended December 31, 2025 was $833,633, which was from aggregate proceeds of $5,019,905

on the sale of common stock, net proceeds of $985,000 from a note payable, offset by repayment of our line of credit balance of

$592,145, and repayment of our notes payable of $4,579,127.

provided by financing activities for the year ended December 31, 2024 was $2,027,009, which was from proceeds of $3,054,073 on the sale

of common stock, proceeds from notes payable of $1,978,000, offset by repayment of our line of credit of $2,503,236, and payment of $500,000

on our acquisition obligation.

consolidated financial statements have been presented on the basis that the Company will continue as a going concern, which contemplates the realization

of assets and satisfaction of liabilities in the normal course of business.

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have a history of reporting net losses.

At December 31, 2024, we had cash of $3,574,876 available to fund our operations, including

expansion plans, and to service our debt, and a negative working capital of $3,204,077.

We anticipate our cash balance will last

until approximately December 2025.

As a result, we have concluded that there is substantial doubt about the Company’s ability

to continue as a going concern.

In addition, the Company’s independent registered public accounting firm has included an

explanatory paragraph in their report with respect to this uncertainty that accompanies the Company’s audited consolidated

financial statements as of and for the year ended December 31, 2024.

The Company’s independent registered public accounting

firm, in their report on the Company’s December 31, 2024 audited consolidated financial statements, has expressed substantial

doubt about the Company’s ability to continue as a going concern.

As of December 31, 2025, we had $3,654,944 in cash available to fund our operations,

including expansion plans, and to service our debt, and working capital of $249,223.

We anticipate our cash balance will last until

December 2026.

As a result, management has concluded, and our independent registered public accounting firm has agreed with our

conclusion that there is a substantial doubt regarding our ability to continue as a going concern for a period of at least 12 months

beyond the filing of this Annual Report on Form 10-K.

The report of our independent registered public accounting firm on our

financial statements for the year ended December 31, 2025, includes an explanatory paragraph regarding the existence of substantial

doubt about our ability to continue as a going concern.

Our consolidated financial statements do not include any

adjustments that might result from the outcome of this uncertainty.

ability to continue as a going concern is dependent upon its ability to raise additional debt or equity capital to fund its business

activities and to ultimately achieve sustainable operating revenues and profitability.

ability to continue as a going concern depends on our ability to raise additional debt or equity capital to fund our business activities

and ultimately achieve sustainable operating revenues and profitability.

market conditions present uncertainty as to our ability to secure additional funds, there can be no assurances that we will be able to

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uncertainty as to the amount and type of financing available to us in the future.

we are unable to obtain the cash resources necessary to satisfy our ongoing cash requirements, we could be required to scale back its

business activities or to discontinue its operations entirely.

consolidated statements of cash flows as discussed herein are presented below.

December 31, 2024

Net cash used in operating activities

$ (2,551,870 )

Net cash used in investing activities

Net cash provided by financing activities

Net increase (decrease) in cash and cash equivalents

provided by or used in operating activities primarily consists of net loss adjusted for certain non-cash items, including amortization

of intangible assets, impairment of intangible assets, gain on forgiveness of government assistance notes payable, and the fair value

of common stock issued for directors, employees, and service providers, and the effect of changes in working capital and other activities.

used in operating activities for the year ended December 31, 2024 was approximately $2,551,870 and consisted of our net loss, adjusted

for non-cash items, including amortization of intangible assets, impairment of goodwill and intangible assets, the fair value of vested

stock options, common stock issued to executives, employees, and advisors, and routine changes in working capital and other activities.

used in operating activities for the year ended December 31, 2023 was approximately $541,791 and consisted of our net loss, adjusted

for non-cash items, including amortization of intangible assets, impairment of intangible assets, fair value of vested stock options,

and the fair value of common stock issued to executives, and routine changes in working capital and other activities.

The Company had no cash flows from investing activities for the year ended December 31, 2024.

provided by investing activities for the year ended December 31, 2023 was $1,138,472, which was comprised of $2,038,472 of cash

received from an acquisition, offset by $900,000 of cash used for capital expenditures.

provided by financing activities for the year ended December 31, 2024 was $2,027,009, which was from proceeds of $3,507,585 on the sale

of common stock, net proceeds of $1,978,000 from a note payable to a related party, offset by repayment of our line of credit balance

of $2,932,305, repayment of our notes payable of $26,271, and payment of $500,000 on our acquisition obligation.

the year ended December 31, 2023, cash provided by financing activities was $1,462,376, which was from net proceeds received from our

line of credit facility of $1,212,376, and a $250,000 working capital advance from Giftify.

Revolving Line of Credit

November 2020, CardCash entered into an amended and restated promissory note for a revolving line of credit with availability of up to

The revolving line of credit is payable on demand, secured by the Company’s inventory, with interest based on the

Wall Street Journal Prime Rate plus 3.00%, limited to a floor of 6.5%.

At December 31, 2024 and December 31, 2023, the average interest

rate was 12% and 12%, respectively.

As of December 31, 2024, the Company was in compliance with customary debt covenants.

As of December

31, 2024, the line of credit balance was $3,805,080, and this line of credit requires a deposit of $1,258,826, which is included in restricted

November 5, 2018, the Company completed the acquisition of Incumaker, Inc.

and assumed certain outstanding convertible notes payable.

At December 31, 2024, there was one remaining assumed convertible note payable outstanding that matured July 2017.

The Company continues

to be unsuccessful in reaching the Note holder to remit payment in full.

At December 31, 2024, the principal balance of $20,000, and

accrued interest of $23,137, are convertible at $1.50 per share into 28,758 shares of the Company’s common stock.

On February 19, 2025, the Company entered into a secured

promissory note (the “Note”) with Real World Digital Assets LLC (“Real World”) in the principal amount of $1,000,000

bearing annual interest of 11.5% that had a maturity date of December 31, 2025.

The Note is collateralized by a blanket lien on the assets

of Giftify under the terms of a Security Agreement and is subordinated only to the line of credit owed by Company to Pathward National

Acquisition Notes Payable

December 29, 2023, the Company issued two-year promissory notes totaling $1,500,000 as partial consideration for the acquisition of CardCash

(see Note 3).

$750,000 is payable on December 29, 2024 (see Note 13), bearing simple annual interest of 5%, and $750,000 is to be paid

upon the earlier of (a) the completion of a firm commitment underwriting the Company’s initial public offering to allow the Company

to become listed on the Nasdaq Capital Market or (b) December 29, 2025.

As of December 31, 2023, the notes payable had an aggregate principal

balance outstanding of $1,500,000.

As of December 31, 2024, the notes payable had an aggregate principal balance outstanding of $1,500,000

and accrued interest payable of $75,000.

Acquisition Note Payable

February 1, 2022, the Company issued two notes payable for the purchase of GameIQ, one for $78,813 and another for $62,101.

In accordance

with Notes, the Company promised to pay the principal together with interest at 1% upon the earlier of (i) nine equal biannual installments

with the first installment due on October 1, 2022, and the final payment due February 1, 2025 (the “Maturity Date”).

of December 31, 2023, the notes payable had an aggregate principal balance outstanding of $102,199 and accrued interest payable of $821.

As of December 31, 2024, the notes payable had an aggregate principal balance outstanding of $75,928 and accrued interest payable of

Injury Disaster Loans (EIDL)

June 17, 2020, the Company received $150,000 of proceeds applicable to loans administered by the SBA as disaster loan assistance under

the Covid-19 Economic Injury Disaster Loan (EIDL) Program.

On July 14, 2021, the Company received an additional $350,000 of proceeds

pursuant to the loan.

On July 21, 2020, the Company received $150,000 of proceeds applicable to loans administered by the SBA as disaster

loan assistance under the Covid-19 EIDL Program.

On January 31, 2022, the Company assumed an additional $14,500 EIDL, and accrued interest

of $900, as part of the consideration paid for the acquisition of GameIQ.

loans bear interest at 3.75% per annum, with a combined repayment of principal and interest of $3,500 per month beginning 12 months from

the date of the promissory note over a period of 30 years.

As of December 31, 2023, the note payable had a principal balance outstanding

of $664,500 and accrued interest payable of $27,259.

As of December 31, 2024, the note payable had a principal balance outstanding of

$664,500 and accrued interest payable of $15,558.

we are unable to secure the cash resources necessary to meet our ongoing cash requirements, we may be required to scale back our business

activities or discontinue operations entirely.

Accounting Policies and Estimates

following discussion and analysis of financial condition and results of operations is based upon the Company’s consolidated financial

statements for the years ended December 31, 2025 and 2024 presented elsewhere in this report, which have been prepared in conformity

with accounting principles generally accepted in the United States of America (“GAAP”).

Certain accounting policies and estimates

are particularly important to the understanding of the Company’s financial position and results of operations and require the application

of significant judgment by management or can be materially affected by changes from period to period in economic factors or conditions

that are outside of the Company’s control.

As a result, these issues are inherently uncertain.

In applying these policies, management

uses its judgment to select the appropriate assumptions for certain estimates.

Those estimates are based on the Company’s historical

operations, the future business plans and the projected financial results, the terms of existing contracts, trends in the industry, and

information available from other outside sources.

Company recognizes revenue in accordance with FASB ASC 606, Revenue from Contracts with Customers .

Company buys merchant gift cards from the general public and distributors at a discount and then resells them at a markup.

also derives revenue from the sale of discount certificates for third-party restaurants.

and costs of sales are recognized when control of the products transfers to our customer, which generally occurs when the risk and title

to the products transfer to the customer upon delivery.

The Company’s performance obligations are satisfied at that time.

The Company’s

standard terms of delivery are included in its contracts of sale, order confirmation documents, and invoices.

The Company recognizes

revenue on a gross basis for the sales price of the merchant gift cards and discount certificates it collects.

Company periodically issues share-based awards to employees, non-employees, and consultants for services rendered.

Stock options vest

and expire according to the terms established at the grant’s issuance date.

Stock grants are measured at the grant date fair value.

Stock-based compensation cost is measured at fair value on the grant date and is generally recognized as an expense in the statement

of operations ratably over the requisite service period or vesting period.

Recognition of compensation expense for non-employees occurs

in the same period and in the same manner as if the Company had paid cash for the services.

and Business Combinations

Company allocates the fair value of the purchase consideration to the tangible assets acquired, the liabilities assumed, and the separately

identifiable intangible assets acquired, based on their estimated fair values.

The excess of the fair value of purchase consideration

over the fair values of these identifiable assets and liabilities is recorded as goodwill.

Such valuations require management to make

significant estimates and assumptions, particularly regarding intangible assets.

Significant estimates in valuing certain intangible

assets include, but are not limited to, future expected cash flows from acquired technology, trademarks, and trade names, useful lives,

and discount rates.

Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently

uncertain and unpredictable, and, as a result, actual results may differ from estimates.

During the measurement period, which can be

up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed, with the

corresponding offset to goodwill.

Upon the conclusion of the measurement period, any subsequent adjustments are recorded in the consolidated

statements of operations.

Accounting Pronouncements

discussion of recent accounting pronouncements in Note 1 to the accompanying financial statements.

Sheet Arrangements

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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-K

Item 7. Management’s Discussion and Analysis