SIEBERT FINANCIAL CORP 10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 0-5703 Siebert Financial Corp. (Exact Name of Registrant as Specified in its Charter) New York 11-1796714 (State or Other Jurisdiction of Incorporation or Organization) (I.R.S. Employer Identification No.) 653 Collins Avenue , Miami Beach , FL 33139 (Address of Principal Executive Offices) (Zip Code) (310) 385-1861 (Registrant’s Telephone Number, Including Area Code) (Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report) Securities registered pursuant to Section 12(b) of the Act: Title of each class Trading Symbol(s) Name of each exchange on which registered Common Stock - $0.01 par value SIEB The Nasdaq Capital Market Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 (“Exchange Act”) during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐ Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐ Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☒ Smaller reporting company ☒ Emerging growth company ☐ If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒ Indicate the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: As of May 13, 2025, there were 41,409,936 issued and 40,409,936 shares outstanding of the registrant’s common stock. SIEBERT FINANCIAL CORP. INDEX PART I - FINANCIAL INFORMATION 1 ITEM 1. FINANCIAL STATEMENTS 1 CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION 1 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS 2 CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY 3 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS 4 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 5 ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 22 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 29 ITEM 4. CONTROLS AND PROCEDURES 30 PART II - OTHER INFORMATION 31 ITEM 1. LEGAL PROCEEDINGS 31 ITEM 1A. RISK FACTORS 31 ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 31 ITEM 3. DEFAULTS UPON SENIOR SECURITIES 31 ITEM 4. MINE SAFETY DISCLOSURES 31 ITEM 5. OTHER INFORMATION 31 ITEM 6. EXHIBITS 32 SIGNATURES 33 i Forward-Looking Statements For purposes of this Quarterly Report on Form 10-Q (“Report”), the terms “Siebert,” “Company,” “we,” “us” and “our” refer to Siebert Financial Corp., and its wholly-owned and majority-owned subsidiaries collectively, unless the context otherwise requires. The statements contained throughout this Report, that are not historical facts, including statements about our beliefs and expectations, are “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements may appear throughout this Report, including in Item 2 “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Forward-looking statements include statements preceded by, followed by or that include the words “may,” “could,” “would,” “should,” “believe,” “expect,” “anticipate,” “plan,” “estimate,” “target,” “project,” “intend” and similar words or expressions. In addition, any statements that refer to expectations, projections, or other characterizations of future events or circumstances are forward-looking statements. These forward-looking statements, which reflect our beliefs, objectives, and expectations as of the date hereof, are based on the best judgement of management. All forward-looking statements speak only as of the date on which they are made. Such forward-looking statements are subject to certain risks, uncertainties and assumptions relating to factors that could cause actual results to differ materially from those anticipated in such statements, including the following: economic, social and political conditions, global economic downturns, including those resulting from extraordinary events; changes and volatility in tariffs and trade policies; securities industry risks; interest rate risks; liquidity risks; credit risk with clients and counterparties; risk of liability for errors in clearing functions; systemic risk; systems failures, delays and capacity constraints; network security risks; competition; reliance on external service providers; new laws and regulations affecting our business; net capital requirements; extensive regulation, regulatory uncertainties and legal matters; failure to maintain relationships with employees, customers, business partners or governmental entities; the inability to achieve synergies or to implement integration plans and other consequences associated with risks and uncertainties detailed in Part I, Item 1A – “ Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2024, (“2024 Form 10-K”), and our other filings with the Securities and Exchange Commission (“SEC”). We caution that the foregoing list of factors is not exclusive, and new factors may emerge, or changes to the foregoing factors may occur, that could impact our business. The forward-looking statements are based upon management’s beliefs and assumptions and are made as of the date of this Report. You should not place undue reliance on these forward-looking statements. We undertake no obligation to publicly update or revise these statements, whether as a result of new information, future events or otherwise, except to the extent required by the federal securities laws. ii PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS SIEBERT FINANCIAL CORP. & SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION March 31, 2025 (unaudited) December 31, 2024 ASSETS Current assets Cash and cash equivalents $ 25,713,000 $ 32,629,000 Cash and securities segregated for regulatory purposes; (Cash of $ 107.1 million, securities with a fair value of $ 44.4 million as of March 31, 2025; Cash of $ 135.8 million, securities with a fair value of $ 68.8 million as of December 31, 2024) 151,448,000 204,587,000 Receivables from customers 79,576,000 84,367,000 Receivables from broker-dealers and clearing organizations 4,771,000 3,920,000 Receivables from non-customers 802,000 607,000 Other receivables 2,904,000 2,744,000 Prepaid expenses and other assets 2,720,000 2,257,000 Securities borrowed 207,591,000 139,040,000 Securities owned, at fair value 29,364,000 21,385,000 Total Current assets 504,889,000 491,536,000 Deposits with broker-dealers and clearing organizations 5,599,000 4,227,000 Property, office facilities, and equipment, net 10,211,000 10,245,000 Software, net 5,651,000 4,836,000 Other intangible assets, net 648,000 697,000 Lease right-of-use assets 2,229,000 2,390,000 Deferred tax assets 2,641,000 3,418,000 Goodwill 2,319,000 2,319,000 Total Assets $ 534,187,000 $ 519,668,000 LIABILITIES AND EQUITY Liabilities Current liabilities Payables to customers $ 206,922,000 $ 227,129,000 Payables to non-customers 2,656,000 3,297,000 Drafts payable 1,055,000 1,331,000 Payables to broker-dealers and clearing organizations 1,291,000 444,000 Accounts payable and accrued liabilities 4,810,000 5,240,000 Taxes payable 3,241,000 2,183,000 Securities loaned 210,688,000 184,962,000 Securities sold, not yet purchased, at fair value 142,000 26,000 Current portion of lease liabilities 1,092,000 886,000 Current portion of long-term debt 89,000 88,000 Current portion of deferred contract incentive 283,000 496,000 Current portion of contract termination liability 1,709,000 1,748,000 Total Current liabilities 433,978,000 427,830,000 Lease liabilities, less current portion 1,416,000 1,787,000 Long-term debt, less current portion 4,116,000 4,140,000 Contract termination liability, less current portion 405,000 819,000 Total Liabilities 439,915,000 434,576,000 Commitments and Contingencies Equity Stockholders’ equity Common stock, $ .01 par value; 100,000,000 shares authorized; 41,357,936 shares issued and 40,357,936 shares outstanding as of March 31, 2025, respectively. 41,120,936 shares issued and 40,120,936 shares outstanding as of December 31, 2024, respectively. 414,000 412,000 Treasury stock, at cost; 1,000,000 shares held as of both March 31, 2025 and December 31, 2024 ( 2,510,000 ) ( 2,510,000 ) Additional paid-in capital 46,642,000 46,090,000 Retained earnings 48,758,000 40,094,000 Total Stockholders’ equity 93,304,000 84,086,000 Noncontrolling interests 968,000 1,006,000 Total Equity 94,272,000 85,092,000 Total Liabilities and Equity $ 534,187,000 $ 519,668,000 Numbers are rounded for presentation purposes. See notes to condensed consolidated financial statements. - 1 - SIEBERT FINANCIAL CORP. & SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) Three Months Ended March 31, 2025 2024 Revenue Commissions and fees $ 2,102,000 $ 2,300,000 Interest, marketing and distribution fees 6,945,000 8,763,000 Principal transactions and proprietary trading 12,961,000 3,506,000 Market making 552,000 672,000 Stock borrow / stock loan 4,837,000 4,098,000 Advisory fees 748,000 490,000 Other income 774,000 627,000 Total Revenue 28,919,000 20,456,000 Expenses Employee compensation and benefits 11,922,000 10,376,000 Clearing fees, including execution costs 454,000 428,000 Technology and communications 1,105,000 876,000 Other general and administrative 1,509,000 1,029,000 Data processing 949,000 751,000 Rent and occupancy 467,000 497,000 Professional fees 1,359,000 1,037,000 Depreciation and amortization 415,000 255,000 Interest expense 89,000 51,000 Advertising and promotion 154,000 54,000 Total Expenses 18,423,000 15,354,000 Operating income 10,496,000 5,102,000 Income before provision for income taxes 10,496,000 5,102,000 Provision for income taxes 1,835,000 1,415,000 Net income 8,661,000 3,687,000 Less net income (loss) attributable to noncontrolling interests ( 3,000 ) ( 1,000 ) Net income available to common stockholders $ 8,664,000 $ 3,688,000 Net income available to common stockholders per share of common stock Basic and diluted $ 0.22 $ 0.09 Weighted average shares outstanding Basic and diluted 40,192,036 39,769,398 Numbers are rounded for presentation purposes. See notes to condensed consolidated financial statements. - 2 - SIEBERT FINANCIAL CORP. & SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (unaudited) Common Stock Treasury Stock Number of Shares Issued $.01 Par Value Number of Shares Amount Additional Paid-In Capital Retained Earnings Total Stockholders’ Equity Noncontrolling Interest Total Equity Balance – January 1, 2024 40,580,936 $ 406,000 1,000,000 $ ( 2,510,000 ) $ 45,016,000 $ 26,808,000 $ 69,720,000 $ 989,000 $ 70,709,000 Transaction with J2 Financial 200,000 2,000 — — 348,000 — 350,000 — 350,000 Share-based compensation 50,000 1,000 — — 84,000 — 85,000 — 85,000 Net income (loss) — — — — — 3,688,000 3,688,000 ( 1,000 ) 3,687,000 Balance – March 31, 2024 40,830,936 $ 409,000 1,000,000 $ ( 2,510,000 ) $ 45,448,000 $ 30,496,000 $ 73,843,000 $ 988,000 $ 74,831,000 Common Stock Treasury Stock Number of Shares Issued $.01 Par Value Number of Shares Amount Additional Paid-In Capital Retained Earnings Total Stockholders’ Equity Noncontrolling Interest Total Equity Balance – January 1, 2025 41,120,936 $ 412,000 1,000,000 $ ( 2,510,000 ) $ 46,090,000 $ 40,094,000 $ 84,086,000 $ 1,006,000 $ 85,092,000 Share-based compensation 237,000 2,000 — — 552,000 — 554,000 — 554,000 RISE Cash Distribution — — — — — — — ( 35,000 ) ( 35,000 ) Net income (loss) — — — — — 8,664,000 8,664,000 ( 3,000 ) 8,661,000 Balance – March 31, 2025 41,357,936 $ 414,000 1,000,000 $ ( 2,510,000 ) $ 46,642,000 $ 48,758,000 $ 93,304,000 $ 968,000 $ 94,272,000 Numbers are rounded for presentation purposes. See notes to condensed consolidated financial statements. - 3 - SIEBERT FINANCIAL CORP. & SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) Three Months Ended March 31, 2025 2024 Cash Flows From Operating Activities Net income $ 8,661,000 $ 3,687,000 Adjustments to reconcile net income to net cash used in operating activities: Deferred income tax expense 777,000 384,000 Depreciation and amortization 415,000 255,000 Share-based compensation (1) 554,000 85,000 Interest related to contract termination liability payment 50,000 10,000 Changes in Securities segregated for regulatory purposes $ 24,389,000 $ 15,075,000 Receivables from customers 4,791,000 ( 1,904,000 ) Receivables from non-customers ( 195,000 ) ( 405,000 ) Receivables from and deposits with broker-dealers and clearing organizations ( 2,223,000 ) ( 5,458,000 ) Securities borrowed ( 68,551,000 ) 11,039,000 Securities owned, at fair value ( 7,979,000 ) ( 1,232,000 ) Prepaid expenses and other assets ( 623,000 ) ( 328,000 ) Payables to customers ( 20,207,000 ) ( 41,438,000 ) Payables to non-customers ( 641,000 ) 36,000 Drafts payable ( 276,000 ) 108,000 Payables to broker-dealers and clearing organizations 847,000 1,522,000 Accounts payable and accrued liabilities ( 430,000 ) 1,227,000 Securities loaned 25,726,000 ( 29,959,000 ) Securities sold, not yet purchased, at fair value 116,000 ( 1,000 ) Net lease liabilities ( 4,000 ) 15,000 Taxes payable 1,058,000 1,029,000 NFS business development credits ( 213,000 ) ( 213,000 ) Contract termination liability payment ( 503,000 ) ( 500,000 ) Net cash used in operating activities ( 34,461,000 ) ( 46,966,000 ) Cash Flows From Investing Activities Purchase of office facilities and equipment ( 63,000 ) ( 28,000 ) Purchase of software ( 940,000 ) ( 877,000 ) Additions to property, office facilities, and equipment ( 144,000 ) ( 821,000 ) Transaction with J2 Financial — ( 35,000 ) Net cash used in investing activities ( 1,147,000 ) ( 1,761,000 ) Cash Flows From Financing Activities Draws on bank loans — 4,800,000 RISE cash distribution ( 35,000 ) — Repayments of long-term debt ( 23,000 ) ( 21,000 ) Net cash (used in) / provided by financing activities ( 58,000 ) 4,779,000 Net change in cash and cash equivalents, and cash segregated for regulatory purposes ( 35,666,000 ) ( 43,948,000 ) Cash and cash equivalents, and cash segregated for regulatory purposes - beginning of period 168,458,000 164,537,000 Cash and cash equivalents, and cash segregated for regulatory purposes - end of period $ 132,792,000 $ 120,589,000 Reconciliation of cash, cash equivalents, and cash and securities segregated for regulatory purposes Cash and cash equivalents - end of period $ 25,713,000 $ 2,856,000 Cash segregated for regulatory purposes - end of period 107,079,000 117,733,000 Cash and cash equivalents, and cash segregated for regulatory purposes - end of period $ 132,792,000 $ 120,589,000 Supplemental cash flow information Cash paid during the period for income taxes $ — $ 2,000 Cash paid during the period for interest $ 39,000 $ 41,000 Non-cash investing and financing activities Transaction with J2 Financial (2) $ — $ 350,000 Numbers are rounded for presentation purposes. See notes to condensed consolidated financial statements. (1) Refer to Note 18 – Employee Benefit Plans for further detail. (2) Refer to Note 10 – Software, Net in the Company’s 2024 10-K for further information. - 4 - SIEBERT FINANCIAL CORP. & SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited) 1. Organization and Basis of Presentation Organization Siebert Financial Corp., a New York corporation, incorporated in 1934, is a holding company that conducts the following lines of business through its wholly-owned and majority-owned subsidiaries: ● Muriel Siebert & Co., LLC (“MSCO”) provides retail brokerage and investment banking services. MSCO is a Delaware corporation and broker-dealer registered with the SEC under the Exchange Act and the Commodity Exchange Act of 1936, and member of the Financial Industry Regulatory Authority (“FINRA”), the New York Stock Exchange (“NYSE”), the Securities Investor Protection Corporation (“SIPC”), and the National Futures Association (“NFA”). ● Siebert AdvisorNXT, LLC (“SNXT”) provides investment advisory services. SNXT is a New York corporation registered with the SEC as a Registered Investment Advisor (“RIA”) under the Investment Advisers Act of 1940. ● Park Wilshire Companies, Inc. (“PW”) provides insurance services. PW is a Texas corporation and licensed insurance agency. ● Siebert Technologies, LLC (“STCH”) provides technology development. STCH is a Nevada limited liability company. ● RISE Financial Services, LLC (“RISE”) is a Delaware limited liability company and a broker-dealer registered with the SEC and NFA. ● StockCross Digital Solutions, Ltd. (“STXD”) is an inactive subsidiary headquartered in Bermuda. ● Gebbia Entertainment, LLC (“GE”) is a Florida limited liability company and provides media entertainment services and serves as the in-house marketing and advertising function for Siebert. For purposes of this Report on Form 10-Q, the terms “Siebert,” “Company,” “we,” “us,” and “our” refer to Siebert Financial Corp., MSCO, SNXT, PW, STCH, RISE, STXD, and GE collectively, unless the context otherwise requires. Effective January 1, 2024, MSCO changed its name from Muriel Siebert & Co., Inc. to Muriel Siebert & Co., LLC, and SNXT changed its name to from Siebert AdvisorNXT, Inc. to Siebert AdvisorNXT, LLC with their tax status changing from C-Corporations to LLCs under state law. The Company is headquartered in Miami Beach, FL with primary operations in Florida, New York, and California. The Company has 12 branch offices throughout the U.S. and clients around the world. The Company’s SEC filings are available through the Company’s website at www.siebert.com, where investors can obtain copies of the Company’s public filings free of charge. The Company’s common stock, par value $ .01 per share, trades on the Nasdaq Capital Market under the symbol “SIEB.” The Company engages in a single line of business as a securities broker-dealer, providing comprehensive brokerage services including custody and clearing of retail accounts, insurance and advisory services, principal transaction and proprietary trading, market making, and securities lending. The Company currently has no other reportable segments. All of the Company’s revenues for the three months ended March 31, 2025 and 2024 were derived from its operations in the U.S. The Company has evaluated the impact of its recent acquisition of GE on its consolidated financial statements and has determined that the acquisition is immaterial. As of March 31, 2025, the Company operates as a single reportable segment based on the factors related to management’s decision-making framework as well as management evaluating performance and allocating resources based on assessments of the Company from a consolidated perspective. Management will continue to monitor the financial significance of the GE acquisition and may report additional segments in accordance with the Financial Accounting Standards Board (“FASB”) ASC Topic 280 – “Improvements to Reportable Segment Disclosures” (“Topic 280”). Basis of Presentation The accompanying unaudited condensed consolidated financial statements (“financial statements”) of the Company have been prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the U.S. (“GAAP”) for interim financial information with the instructions for Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP for complete annual financial statements. The U.S. dollar is the functional currency of the Company and numbers are rounded for presentation purposes. In the opinion of management, the financial statements contain all adjustments (consisting of normal recurring entries) necessary to fairly present such interim results. Interim results are not necessarily indicative of the results of operations which may be expected for a full year or any subsequent period. These financial statements should be read in conjunction with the financial statements and notes thereto in the Company’s 2024 Form 10-K. - 5 - Reclassification Certain amounts for the three months ended March 31, 2024 and certain cash flows within the Investing Activities section have been reclassified to conform to the presentation of the current period. The reclassification has not materially impacted the Company’s financial statements, and did not result in a change in total revenue, net income or cash flows from operations or investing activities for the periods presented. Principles of Consolidation The financial statements include the accounts of Siebert and its wholly-owned and majority-owned consolidated subsidiaries. Upon consolidation, all intercompany balances and transactions are eliminated. The Company’s ownership in RISE was 68 % as of both March 31, 2025 and December 31, 2024. Refer to Note 5 – RISE in the Company’s 2024 Form 10-K for further information. For consolidated subsidiaries that are not wholly-owned, the third-party holdings of equity interests are referred to as noncontrolling interests. The net income or loss attributable to noncontrolling interests for such subsidiaries is presented as net income or loss attributable to noncontrolling interests in the statements of operations. The portion of total equity that is attributable to noncontrolling interests for such subsidiaries is presented as noncontrolling interests in the statements of financial condition. For investments in entities in which the Company does not have a controlling financial interest but has significant influence over its operating and financial decisions, the Company applies the equity method of accounting with net income and losses recorded in earnings of equity method investment in related party. Significant Accounting Policies The Company’s significant accounting policies are included in Note 2 – Summary of Significant Accounting Policies in the Company’s 2024 Form 10-K. During the three months ended March 31, 2025, there were no significant changes made to the Company’s significant accounting policies. Except as set forth below, those policies were unchanged during the three months ended March 31, 2025. Restricted Equity Securities During the three months ended March 31, 2025, the Company participated in a private placement and acquired restricted shares of a private U.S. company in 2025 (the “Investment in Equity Security”). These shares are subject to restrictions on transferability and did not have a readily determinable fair value at the time of acquisition. Accordingly, the Company accounted for the investment at cost, in accordance with ASC 321-10-35-2, Investments – Equity Securities: Subsequent Measurement, using the measurement alternative under ASU 2016-01, Financial Instruments – Overall (Subtopic 825-10). On March 31, 2025, the issuer completed its initial public offering, and the Company’s restricted shares converted into restricted publicly traded shares as part of the IPO process. These shares remain subject to resale restrictions until such resale is registered with the SEC or an exemption from such registration requirement becomes available. In accordance with ASC 321, once observable events indicate that fair value is readily determinable, the measurement alternative must be discontinued. As a result of the IPO, the Company began measuring the investment at fair value, with changes in fair value recognized in earnings on a recurring basis. Additionally, the Company applied ASU 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions, which clarifies that contractual sale restrictions are not considered in fair value measurements under ASC 820. However, a discount for lack of marketability may still be considered if it reflects assumptions that market participants would use. In this case, the Company has not applied a discount solely for the period prior to the initial public offering, but did apply a discount subsequent to the initial public offering, including a 40 % discount as of March 31, 2025 as indicated in Note 4 – Fair Value Measurement. The investment is classified as a Level 3 asset in the fair value hierarchy due to the use of significant unobservable inputs in the valuation. Refer to Note 4 – Fair Value Measurements for additional details. 2. New Accounting Standards Recently Issued Accounting Standards In December 2023, the FASB issued ASU 2023-09, “Improvements to Income Tax Disclosures” (“ASU 2023-09”). The ASU is intended to enhance the transparency and decision usefulness of income tax disclosures. The amendments in the ASU address investor requests for enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information. ASU 2023-09 will be effective for the Company for annual periods beginning after December 15, 2024, though early adoption is permitted. The Company is still evaluating the presentational effect that ASU 2023-09 will have on its consolidated financial statements, but the Company expects considerable changes to its income tax footnote. - 6 - In November 2024, the FASB issued ASU “2024-03”, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures” (“ASU 2024-03”). The ASU is intended to enhance the transparency and decision usefulness of income statement expense disclosures by requiring greater disaggregation of certain expense categories. ASU 2024-03 will be effective for us for annual periods beginning after December 15, 2025, though early adoption is permitted. We are currently evaluating the impact that ASU 2024-03 will have on our consolidated financial statements and we anticipate the amendments will require significant changes to our expense disclosures. Accounting Standards Adopted in Fiscal 2025 The Company did not adopt any new accounting standards during the three months ended March 31, 2025. In addition, the Company has evaluated other recently issued accounting standards and does not believe that any of these standards will have a material impact on the Company’s financial statements and related disclosures as of March 31, 2025. 3. Receivables From, Payables To, and Deposits With Broker-Dealers and Clearing Organizations Amounts receivable from, payables to, and deposits with broker-dealers and clearing organizations consisted of the following as of the periods indicated: As of March 31, 2025 As of December 31, 2024 Receivables from and deposits with broker-dealers and clearing organizations DTCC / OCC / NSCC (1) $ 7,647,000 $ 5,777,000 Goldman Sachs & Co. LLC (“GSCO”) 53,000 50,000 National Financial Services, LLC (“NFS”) 2,482,000 2,102,000 Securities fail-to-deliver 113,000 90,000 Globalshares 75,000 68,000 Other receivables — 60,000 Total Receivables from and deposits with broker-dealers and clearing organizations $ 10,370,000 $ 8,147,000 Payables to broker-dealers and clearing organizations Securities fail-to-receive $ 845,000 $ 439,000 Payables to broker-dealers 446,000 5,000 Total Payables to broker-dealers and clearing organizations $ 1,291,000 $ 444,000 (1) Depository Trust & Clearing Corporation is referred to as (“DTCC”), Options Clearing Corporation is referred to as (“OCC”), and National Securities Clearing Corporation is referred to as (“NSCC”). Under the DTCC shareholders’ agreement, MSCO is required to participate in the DTCC common stock mandatory purchase. As of March 31, 2025 and December 31, 2024, MSCO had shares of DTCC common stock valued at approximately $ 1.1 M which is included within the line item “Deposits with broker-dealers and clearing organizations” on the statements of financial condition. In September 2022, MSCO and RISE entered into a clearing agreement whereby RISE would introduce clients to MSCO. Refer to Note 19 – Related Party Disclosures for more detail. 4. Fair Value Measurements Overview ASC 820 defines fair value, establishes a framework for measuring fair value as well as a hierarchy of fair value inputs. Refer to the below as well as Note 2 – Summary of Significant Accounting Policies in the Company’s 2024 Form 10-K for further information regarding fair value hierarchy, valuation techniques and other items related to fair value measurements. - 7 - Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis The tables below present, by level within the fair value hierarchy, financial assets and liabilities, measured at fair value on a recurring basis for the periods indicated. As required by ASC Topic 820, financial assets and financial liabilities are classified in their entirety based on the lowest level of input that is significant to the respective fair value measurement. As of March 31, 2025 Level 1 Level 2 Level 3 Total Assets Cash and securities segregated for regulatory purposes U.S. government securities $ 44,369,000 $ — $ — $ 44,369,000 Securities owned, at fair value U.S. government securities $ 17,271,000 $ — $ — $ 17,271,000 Certificates of deposit — 141,000 — 141,000 Municipal securities — 117,000 — 117,000 Corporate bonds — 16,000 — 16,000 Unit investment trust — 229,000 — 229,000 Options 1,000 — — 1,000 Equity securities 667,000 89,000 10,833,000 11,589,000 Total Securities owned, at fair value $ 17,939,000 $ 592,000 $ 10,833,000 $ 29,364,000 Liabilities Securities sold, not yet purchased, at fair value Equity securities $ 78,000 $ — $ — $ 78,000 Options 64,000 — — 64,000 Total Securities sold, not yet purchased, at fair value $ 142,000 $ — $ — $ 142,000 As of December 31, 2024 Level 1 Level 2 Level 3 Total Assets Cash and securities segregated for regulatory purposes U.S. government securities $ 68,758,000 $ — $ — $ 68,758,000 Securities owned, at fair value U.S. government securities $ 20,086,000 $ — $ — $ 20,086,000 Certificates of deposit — 112,000 — 112,000 Corporate bonds — 2,000 — 2,000 Options 58,000 — — 58,000 Equity securities 1,055,000 72,000 — 1,127,000 Total Securities owned, at fair value $ 21,199,000 $ 186,000 $ — $ 21,385,000 Liabilities Securities sold, not yet purchased, at fair value Equity securities $ 1,000 $ — $ — $ 1,000 Options 25,000 25,000 Total Securities sold, not yet purchased, at fair value $ 26,000 $ — $ — $ 26,000 - 8 - The Company had U.S. government securities with the market values and maturity dates for the periods indicated below. As of March 31, 2025 Maturing in 2025 $ 48,367,000 Maturing in 2026 13,063,000 Accrued interest 210,000 Total Market value $ 61,640,000 As of December 31, 2024 Maturing in 2025 $ 80,739,000 Maturing in 2026 8,019,000 Accrued interest 86,000 Total Market value $ 88,844,000 Level 3 Instrument The Company valued the Investment in Equity Security using a Finnerty option-pricing model. A 45-day expected holding period and 120 % expected volatility yielded approximately a 40 % discount for a lack of marketability which reflects market-participant pricing for the typical reversion of IPOs with 500 % day-one gains, meme-stock volatility premiums, and the issuer’s outstanding high-stakes litigation. The following table provides a reconciliation of our Level 3 assets, which are valued using significant unobservable inputs. These assets are measured at fair value based on internally developed models, with adjustments reflecting market conditions and management’s best estimates. There were no transfers in or out of Level 3 assets for the three months ended March 31, 2025. The table below outlines changes in Level 3 assets for the reporting period, including purchases, sales, and unrealized gains or losses: As of and for the Three Months Ended March 31, 2025 Category Opening Balance Purchases Sales Transfers In / Out Unrealized Gains / (Losses) Closing Balance Equity Security Investment $ — $ 1,600,000 $ — $ — $ 9,233,000 $ 10,833,000 For the three months ended March 31, 2025, the Company recorded an unrealized gain of approximately $ 9.2 million in relation to the Investment in Equity Security. However, due to the volatility of the price of the shares, which has declined significantly since March 31, 2025, management is uncertain as to the total unrealized or realized gain or loss that will be recognized from the Investment in Equity Security. Solely for illustrative purposes, on May 7, 2025, the closing share price of the Investment in Equity Security fell to $ 25.24 per share, compared with $ 83.51 per share ($ 50.11 per share after the 40 % discount) as of March 31, 2025. Had the Company sold its shares on May 7, 2025, the total gain would have been approximately $ 3.9 million, instead of the $ 9.2 million unrealized gain recognized during the three months ended March 31, 2025. Because the decline reflects conditions arising after March 31, 2025, no adjustment has been made to the accompanying financial statements. The potential change in the market value of the Investment in Equity Security may materially impact the results of future periods. - 9 - Financial Assets and Liabilities Not Carried at Fair Value Financial assets and liabilities not measured at fair value are recorded at carrying value, which approximates fair value either due to their short-term nature, or in the case of long-term assets or liabilities, management has determined the difference in the carrying value and fair value is immaterial. The tables below represents financial instruments in which the ending balances as of March 31, 2025 and December 31, 2024 are not carried at fair value in the statements of financial condition: As of March 31, 2025 Carrying Value Fair Value Level 1 Level 2 Level 3 Financial assets, not measured at fair value Cash and cash equivalents $ 25,713,000 $ 25,713,000 $ 25,713,000 $ — $ — Cash – segregated for regulatory purposes 107,079,000 107,079,000 107,079,000 — — Securities borrowed 207,591,000 207,591,000 — 207,591,000 — Receivables from customers 79,576,000 79,576,000 — 79,576,000 — Receivables from non-customers 802,000 802,000 — 802,000 — Receivables from broker-dealers and clearing organizations 4,771,000 4,771,000 — 4,771,000 — Other receivables 2,904,000 2,904,000 — 2,904,000 — Deposits with broker-dealers and clearing organizations 5,599,000 5,599,000 — 5,599,000 — Total financial assets, not measured at fair value $ 434,035,000 $ 434,035,000 $ 132,792,000 $ 301,243,000 $ — Financial liabilities, not measured at fair value Securities loaned $ 210,688,000 $ 210,688,000 $ — $ 210,688,000 $ — Payables to customers 206,922,000 206,922,000 — 206,922,000 — Payables to non-customers 2,656,000 2,656,000 — 2,656,000 — Drafts payable 1,055,000 1,055,000 — 1,055,000 — Payables to broker-dealers and clearing organizations 1,291,000 1,291,000 — 1,291,000 — Deferred contract incentive 283,000 283,000 — 283,000 — Long-term debt 4,205,000 4,205,000 — 4,205,000 — Contract termination liability 2,114,000 2,114,000 — 2,114,000 — Total financial liabilities, not measured at fair value $ 429,214,000 $ 429,214,000 $ — $ 429,214,000 $ — As of December 31, 2024 Carrying Value Fair Value Level 1 Level 2 Level 3 Financial assets, not measured at fair value Cash and cash equivalents $ 32,629,000 $ 32,629,000 $ 32,629,000 $ — $ — Cash – segregated for regulatory purposes 135,829,000 135,829,000 135,829,000 — — Securities borrowed 139,040,000 139,040,000 — 139,040,000 — Receivables from customers 84,367,000 84,367,000 — 84,367,000 — Receivables from non-customers 607,000 607,000 — 607,000 — Receivables from broker-dealers and clearing organizations 3,920,000 3,920,000 — 3,920,000 — Other receivables 2,744,000 2,744,000 — 2,744,000 — Deposits with broker-dealers and clearing organizations 4,227,000 4,227,000 — 4,227,000 — Total financial assets, not measured at fair value $ 403,363,000 $ 403,363,000 $ 168,458,000 $ 234,905,000 $ — Financial liabilities, not measured at fair value Securities loaned $ 184,962,000 $ 184,962,000 $ — $ 184,962,000 $ — Payables to customers 227,129,000 227,129,000 — 227,129,000 — Payables to non-customers 3,297,000 3,297,000 — 3,297,000 — Drafts payable 1,331,000 1,331,000 — 1,331,000 — Payables to broker-dealers and clearing organizations 444,000 444,000 — 444,000 — Deferred contract incentive 496,000 496,000 — 496,000 — Long-term debt 4,228,000 4,228,000 — 4,228,000 — Contract termination liability 2,567,000 2,567,000 — 2,567,000 — Total financial liabilities, not measured at fair value $ 424,454,000 $ 424,454,000 $ — $ 424,454,000 $ — - 10 - 5. Property, Office Facilities, and Equipment, Net Property, office facilities, and equipment consisted of the following as of the periods indicated: As of March 31, 2025 As of December 31, 2024 Property $ 6,815,000 $ 6,815,000 Office facilities 4,333,000 4,165,000 Equipment 984,000 945,000 Total Property, office facilities, and equipment 12,132,000 11,925,000 Less accumulated depreciation ( 1,921,000 ) ( 1,680,000 ) Total Property, office facilities, and equipment, net $ 10,211,000 $ 10,245,000 Total depreciation expense for property, office facilities, and equipment was $ 242,000 and $ 146,000 for the three months ended March 31, 2025 and 2024, respectively. The Company invested $ 99,000 to build out its office in Omaha, Nebraska, for the three months ended March 31, 2024. The Company invested $ 23,000 and $ 664,000 to build out the New York office space in the World Financial Center for the three months ended March 31, 2025 and 2024, respectively. Depreciation expense commenced in March 2024, when the New York office space was placed into service. Miami Office Building On December 30, 2021, the Company purchased an office building located at 653 Collins Ave, Miami Beach, FL (“Miami office building”). The Miami office building contains approximately 12,000 square feet of office space and serves as the headquarters of the Company. The Company invested $ 120,000 and $ 58,000 in the three months ended March 31, 2025 and 2024, respectively, to build out the Miami office building. Depreciation expense commenced in April 2023 when the Miami office building was completed and placed in service. 6. Software, Net Software consisted of the following as of the periods indicated: As of March 31, 2025 As of December 31, 2024 Software $ 1,881,000 $ 1,774,000 Retail Platform 4,926,000 4,093,000 Total Software 6,807,000 5,867,000 Less accumulated amortization – Software ( 1,156,000 ) ( 1,031,000 ) Total Software, net $ 5,651,000 $ 4,836,000 The Company contracted with a technology vendor in the fourth quarter of 2023 to support the development of the Retail Platform, supplementing its internal technology resources. The total software development cost related to the Retail Platform was $ 4,926,000 as of March 31, 2025, all of which was capitalized. Amortization for the Retail Platform will commence once it is placed in service, which is expected to be in the second quarter of 2025. - 11 - Total amortization of software was $ 125,000 and $ 109,000 for the three months ended March 31, 2025 and 2024, respectively. As of March 31, 2025, the Company estimates the following future amortization of software assets: Year Amount 2025 $ 913,000 2026 1,235,000 2027 1,046,000 2028 983,000 2029 and after 1,474,000 Total $ 5,651,000 7. Leases As of March 31, 2025, all of the Company’s leases are classified as operating and primarily consist of office space leases expiring in 2025 through 2029. The Company elected not to include short-term leases (i.e., leases with initial terms of less than twelve months), or equipment leases (deemed immaterial) on the statements of financial condition. The Company leases some miscellaneous office equipment, but they are immaterial and therefore the Company records the costs associated with this office equipment on the statements of operations rather than capitalizing them as lease right-of-use assets. The balance of the lease right-of-use assets and lease liabilities are displayed on the statements of financial condition and the below tables display further detail on the Company’s leases. Lease Term and Discount Rate As of March 31, 2025 As of December 31, 2024 Weighted average remaining lease term – operating leases (in years) 3.2 3.3 Weighted average discount rate – operating leases 7.4 % 7.3 % Three Months Ended March 31, 2025 2025 2024 Operating lease cost $ 270,000 $ 283,000 Short-term lease cost 100,000 160,000 Variable lease cost 97,000 54,000 Total Rent and occupancy $ 467,000 $ 497,000 Operating cash flows from operating leases $ 267,000 $ 269,000 Operating leases $ — $ — Lease Commitments Future annual minimum payments for operating leases with initial terms of greater than one year as of March 31, 2025 were as follows: Year Amount 2025 $ 781,000 2026 855,000 2027 613,000 2028 522,000 2029 58,000 Remaining balance of lease payments 2,829,000 Less: difference between undiscounted cash flows and discounted cash flows 321,000 Lease liabilities $ 2,508,000 - 12 - 8. Goodwill and Other Intangible Assets, Net Goodwill As of March 31, 2025 and December 31, 2024, the Company’s carrying amount of goodwill was both $ 2,319,000 . As of March 31, 2025, $ 1,989,000 of the Company’s carrying amount of goodwill came from the Company’s acquisition of RISE and $ 330,000 came from the Company’s acquisition of GE. As of March 31, 2025, management concluded that there have been no impairments to the carrying value of the Company’s goodwill and no impairment charges related to goodwill were recognized during the three months ended March 31, 2025 and 2024. Refer to Note 2 – Summary of Significant Accounting Policies in the Company’s 2024 Form 10-K for further information. Other Intangible Assets, Net As a result of the Company’s acquisition of GE, the Company acquired intangible assets consisting of GE artist contracts, the fair value of which were $ 778,000 as of the acquisition date. Amortization commenced upon acquisition and is recognized over its estimated useful life of 4 years. Amortization expense for the intangible asset totaled $ 48,000 for the three months ended March 31, 2025. As of March 31, 2025, the Company estimates the following future amortization of other intangible assets: Year Amount 2025 $ 146,000 2026 194,000 2027 194,000 2028 114,000 Total $ 648,000 9. Long-Term Debt Mortgage with East West Bank Overview On December 30, 2021, the Company purchased the Miami office building for approximately $ 6.8 million, and the Company entered into a mortgage with East West Bancorp, Inc. (“East West Bank”) for approximately $ 4 million to finance part of the purchase of the Miami office building as well as $ 338,000 to finance part of the build out of the Miami office building. As of March 31, 2025 and December 31, 2024, the Company’s outstanding balance of the mortgage was $ 4,205,000 and $ 4,228,000 , respectively. The Company’s obligations under the mortgage are secured by a lien on the Miami office building and the term of the loan is ten years . The repayment schedule will utilize a 30-year amortization period, with a balloon on the remaining amount due at the end of ten years. The interest rate is 3.6 % for the first 7 years, and thereafter the interest rate shall be at the prime rate as reported by the Wall Street Journal, provided that the minimum interest rate on any term loan will not be less than 3.6 %. As part of the agreement, the Company must maintain a debt service coverage ratio of 1.4 to 1. The loan is subject to a prepayment penalty over the first five years which is calculated as a percentage of the principal amount outstanding at the time of prepayment. This percentage is 5% in the first year and decreases by 1% each year thereafter, with the prepayment penalty ending after 5 years. As of March 31, 2025, the Company was in compliance with all of its covenants related to this agreement. Remaining Payments Future remaining annual minimum principal payments for the mortgage with East West Bank as of March 31, 2025 were as follows: Year Amount 2025 $ 65,000 2026 91,000 2027 95,000 2028 98,000 2029 112,000 Thereafter 3,744,000 Total $ 4,205,000 - 13 - The interest expense related to this mortgage was $ 38,000 and $ 39,000 for the three months ended March 31, 2025, and 2024, respectively. As of March 31, 2025, the interest rate for this mortgage was 3.6 %. 10. Deferred Contract Incentive Effective August 1, 2021, MSCO entered into an amendment to its clearing agreement with NFS that, among other things, extended the term of the arrangement for an additional four-year period commencing on August 1, 2021 and ending July 31, 2025. As part of this agreement, the Company received a one-time business development credit of $ 3 million from NFS, and NFS will pay the Company four annual credits of $ 100,000 , which are recorded in the line item “Deferred contract incentive” on the statements of financial condition. Annual credits shall be paid on the anniversary of the date on which the first credit was paid. The business development credit and annual credits will be recognized as contra expense over four years and one year , respectively, in the line item “Clearing fees, including execution costs” on the statements of operations. The amendment also provides for an early termination fee if the Company chooses to end its agreement before the end of the contract term. In relation to this agreement, the Company recognized $ 213,000 in contra expense for both the three months ended March 31, 2025 and 2024. As of March 31, 2025 and December 31, 2024, the balance of the deferred contract incentive was $ 0.3 million and $ 0.5 million, respectively. 11. Revenue Recognition Refer to Note 2 – Summary of Significant Accounting Policies in Company’s 2024 Form 10-K for detail on the Company’s primary sources of revenue and the corresponding accounting treatment. There were no significant changes to the accounting policies for revenue recognition and except as set forth below, those policies were unchanged during the three months ended March 31, 2025. Principal Transactions and Proprietary Trading The Company continuously invests in treasury bill and treasury notes as part of its normal operations to meet deposit requirements, which are primarily in the line item “Cash and securities segregated for regulatory purposes” on the statements of financial condition, in order to enhance its yield on its excess 15c3-3 deposits. In 2025, the Company acquired the Investment in Equity Security and the unrealized gain related to this investment is included in the “Unrealized gain on investment in equity security” line in the table below. Refer to Note 1 – Organization and Basis of Presentation, Note 4 – Fair Value Measurements, and Item 2. – Management’s Discussions and Analysis of Financial Condition and Results of Operations for further detail. Restricted Equity Securities The following table represents detail related to principal transactions and proprietary trading. Three Months Ended March 31, 2025 2024 Increase (Decrease) Principal transactions and proprietary trading Realized and unrealized gain on primarily riskless principal transactions $ 3,712,000 $ 3,443,000 $ 269,000 Unrealized gain on investment in equity security 9,233,000 — 9,233,000 Realized and unrealized gain on portfolio of U.S. government securities 16,000 63,000 ( 47,000 ) Total Principal transactions and proprietary trading $ 12,961,000 $ 3,506,000 $ 9,455,000 Disaggregation of Revenue The Company generated a significant portion of its revenue from financial instruments comprising of margin revenue, securities lending, principal transactions and proprietary trading, and interest revenue. These net interest and other revenues are not within the scope of FASB ASC Topic 606 – “Revenue from Contracts with Customers” (“Topic 606”), because they are generated from financial instruments covered by various other areas of GAAP. Market making activities are not within the scope of Topic 606, as they do not meet the definition of a contract with a customer under the standard. Consequently, revenue and expenses related to market making activity are accounted for separately and not included in the revenue figures presented in accordance with Topic 606. The Company also has fee revenue and transaction revenue which are within the scope of Topic 606. Revenue from contracts with customers includes commission income charged to retail clients for executing transactions, markups on riskless principal transactions charged to retail clients for executing transactions, distribution income received from mutual funds for client transactions, stock locate fees charged to counterparties for providing locate services, payment for order flow received for executing transactions, and administrative fees to retail clients including for maintenance and other ancillary services. Under Topic 606, Revenue from Contracts with Customers, requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance requires an entity to follow a five-step model to (a) identify the contract(s) with a customer, (b) identify the performance obligations in the contract, (c) determine the transaction price, (d) allocate the transaction price to the performance obligations in the contract, and (e) recognize revenue when (or as) the entity satisfies a performance obligation. In determining the transaction price, an entity may include variable consideration only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized would not occur when the uncertainty associated with the variable consideration is resolved. - 14 - The table below presents detailed information on the Company’s recognition of revenue from contracts with customers as well as revenues from financial instruments, which are outside the scope of Topic 606, by major types of services for the periods indicated. Three Months Ended March 31, 2025 2024 Revenues from Contracts with Customers Principal transactions and proprietary trading Riskless principal transactions with customers $ 3,740,000 $ 3,562,000 Commissions and fees Brokerage commissions 1,543,000 1,892,000 Distribution fees 357,000 325,000 Insurance commissions 202,000 82,000 Stock borrow / stock loan Retail fees (rebates) 6,000 ( 9,000 ) Stock locate services 4,032,000 3,598,000 Other income Administrative fees 528,000 342,000 Payment for order flow 246,000 295,000 Other commissions — ( 9,000 ) Advisory fees 748,000 490,000 Total Revenues from contracts with customers $ 11,402,000 $ 10,568,000 Revenue outside the scope of Topic 606 Principal transactions and proprietary trading Proprietary trading ( 12,000 ) ( 56,000 ) Principal transactions - equity investment 9,233,000 — Interest, marketing and distribution fees Margin interest 3,395,000 3,976,000 Interest income 3,050,000 4,281,000 Marking and distribution fees 500,000 506,000 Stock borrow / stock loan Stock rebate revenue 799,000 509,000 Market making 552,000 672,000 Total Revenue Outside the Scope of Topic 606 17,517,000 9,888,000 Total Revenue $ 28,919,000 $ 20,456,000 - 15 - 12. Income Taxes The Company’s provision for income taxes consists of federal and state taxes, as applicable, in amounts necessary to align the Company’s year-to-date tax provision with the effective rate that it expects to achieve for the full year. Each quarter the Company updates its estimate of the annual effective tax rate and records cumulative adjustments as necessary. As of March 31, 2025, the Company has concluded that its deferred tax assets are realizable on a more-likely-than-not basis with the exception of investments that are expected to generate capital losses when realized. For the three months ended March 31, 2025, the Company recorded an income tax provision of $ 1,835,000 on pre-tax book income of $ 10,496,000 . The effective tax rate for the three months ended March 31, 2025 was 17 %. The effective tax rate differs from the federal statutory rate of 21 % primarily related to the Company’s ability to utilize certain deferred tax assets for capital loss carryforwards to offset expected capital gains on its Investment in Equity Security. These capital loss carryforwards were not previously realizable on a more-likely-than-not basis and the Company has reversed a portion of its valuation allowance resulting in an income tax benefit. For the three months ended March 31, 2024, the Company recorded an income tax provision of $ 1,415,000 on pre-tax book income of $ 5,102,000 . The effective tax rate for the three months ended March 31, 2024 was 28 %. The effective tax rate differs from the federal statutory rate of 21 % primarily related to certain permanent tax differences and state and local taxes. As of both March 31, 2025 and December 31, 2024, the Company recorded an uncertain tax position of $ 1,354,000 related to various tax matters, which is included in the line item “Taxes payable” in the statements of financial condition. 13. Capital Requirements MSCO Net Capital MSCO is subject to the Uniform Net Capital Rules of the SEC (Rule 15c3-1) of the Exchange Act. Under the alternate method permitted by this rule, net capital, as defined, shall not be less than the lower of $ 1 million or 2 % of aggregate debit items arising from customer transactions. As of March 31, 2025, MSCO’s net capital was $ 62.3 million, which was approximately $ 60.4 million in excess of its required net capital of $ 1.9 million, and its percentage of aggregate debit balances to net capital was 65.53 %. As of December 31, 2024, MSCO’s net capital was $ 63.9 million, which was approximately $ 62.0 million in excess of its required net capital of $ 1.9 million, and its percentage of aggregate debit balances to net capital was 65.84 %. Special Reserve Account MSCO is subject to Customer Protection Rule 15c3-3 which requires segregation of funds in a special reserve account for the exclusive benefit of customers. As of March 31, 2025, MSCO had cash and securities deposits of $ 150.2 million (cash of $ 105.8 million, securities with a fair value of $ 44.4 million) in the special reserve accounts which was $ 14.3 million in excess of the deposit requirement of $ 135.9 million. MSCO had no adjustments for deposit(s) and / or withdrawal(s) made on April 1, 2025. As of December 31, 2024, MSCO had cash and securities deposits of $ 203.3 million (cash of $ 134.5 million, securities with a fair value of $ 68.8 million) in the special reserve accounts which was $ 9.5 million in excess of the deposit requirement of $ 193.8 million. After adjustments for deposit(s) and / or withdrawal(s) made on January 2, 2025, MSCO had $ 1.7 million in excess of the deposit requirement. As of March 31, 2025, the Company was subject to the PAB Account Rule 15c3-3 of the SEC which requires segregation of funds in a special reserve account for the exclusive benefit of proprietary accounts of introducing broker-dealers. As of March 31, 2025, the Company had $ 1.3 million in the special reserve account which was approximately $ 0.2 million in excess of the deposit requirement of approximately $ 1.1 million. The Company made no subsequent deposits or withdrawals on April 1, 2025. As of December 31, 2024, the Company had $ 1.3 million in the special reserve account which was approximately $ 0.1 million in excess of the deposit requirement of approximately $ 1.2 million. The Company made no subsequent deposits or withdrawals on January 2, 2025. - 16 - RISE Net Capital RISE, as a member of FINRA, is subject to the SEC Uniform Net Capital Rule 15c3-1. This rule requires the maintenance of minimum net capital and that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1 and that equity capital may not be withdrawn, or cash dividends paid if the resulting net capital ratio would exceed 10 to 1. RISE is also subject to the CFTC’s minimum financial requirements which require that RISE maintain net capital, as defined, equal to the greater of its requirements under Regulation 1.17 under the Commodity Exchange Act or Rule 15c3-1. As of March 31, 2025, RISE’s regulatory net capital was approximately $ 1.2 million which was $ 0.9 million in excess of its minimum requirement of $ 250,000 under 15c3-1. As of December 31, 2024, RISE’s regulatory net capital was approximately $ 1.3 million which was $ 1.0 million in excess of its minimum requirement of $ 250,000 under 15c3-1. 14. Financial Instruments with Off-Balance Sheet Risk The Company enters into various transactions to meet the needs of customers, conduct trading activities, and manage market risks and is, therefore, subject to varying degrees of market and credit risk. Refer to the below as well as Note 19 – Financial Instruments with Off-Balance Sheet Risk in the Company’s 2024 Form 10-K for further information. As of March 31, 2025, the Company had margin loans extended to its customers of approximately $ 390.1 million, of which $ 79.6 million is within the line item “Receivables from customers” on the statements of financial condition. As of December 31, 2024, the Company had margin loans extended to its customers of approximately $ 403.8 million, of which $ 84.4 million is in the line item “Receivables from customers” on the statements of financial condition. There were no material losses for unsettled customer transactions for the three months ended March 31, 2025 and 2024. The following table presents information about the Company’s securities borrowing and lending activity depicting the potential effect of rights of setoff between these recognized assets and liabilities. As of March 31, 2025 Gross Amounts of Recognized Assets and Liabilities Gross Amounts Offset in the Consolidated Statements of Financial Condition 1 Net Amounts Presented in the Consolidated Statements of Financial Condition FMV - Collateral Received or Pledged 2 Net Amount 3 Assets Securities borrowed $ 207,591,000 $ — $ 207,591,000 $ 197,710,000 $ 9,881,000 Liabilities Securities loaned $ 210,688,000 $ — $ 210,688,000 $ 200,536,000 $ 10,152,000 As of December 31, 2024 Gross Amounts of Recognized Assets and Liabilities Gross Amounts Offset in the Consolidated Statements of Financial Condition 1 Net Amounts Presented in the Consolidated Statements of Financial Condition FMV - Collateral Received or Pledged 2 Net Amount 3 Assets Securities borrowed $ 139,040,000 $ — $ 139,040,000 $ 126,484,000 $ 12,556,000 Liabilities Securities loaned $ 184,962,000 $ — $ 184,962,000 $ 170,780,000 $ 14,182,000 (1) Amounts represent recognized assets and liabilities that are subject to enforceable master agreements with rights of setoff. The Company did not net any securities borrowed or securities loaned as of March 31, 2025 or December 31, 2024. (2) Represents the fair value of collateral the Company had received or pledged under enforceable master agreements. (3) Represents the total contract value as presented in the financial statements less the fair market value of the collateral received or pledged. - 17 - 15. Earnings Per Common Share The following table sets forth the computation of basic and diluted earnings per common share for the three months ended March 31, 2025 and 2024. Three Months Ended March 31, 2025 2024 Net income $ 8,661,000 $ 3,687,000 Less net income (loss) attributable to noncontrolling interests ( 3,000 ) ( 1,000 ) Net income available to common stockholders $ 8,664,000 $ 3,688,000 Weighted-average common shares outstanding - basic 40,192,036 39,769,398 Dilutive effect of unvested shares 42,988 — Weighted-average common shares used to compute diluted loss per share 40,235,024 39,769,398 Net income per share attributable to common stockholders: Basic $ 0.22 $ 0.09 Diluted $ 0.22 $ 0.09 Basic earnings per common share is calculated by dividing net income attributable to common shareholders by the weighted-average number of common shares outstanding during the period. Diluted earnings per common share is calculated by adjusting the weighted-average number of common shares outstanding for the potential dilutive effect of securities, if applicable. For the three months ended March 31, 2025, the Company had 300,000 antidilutive shares outstanding. The Company had no anti-dilutive shares outstanding as of December 31, 2024. 16. Commitments, Contingencies, and Other Legal and Regulatory Matters In the normal course of business, the Company may be subject to various proceedings and claims arising from its business activities, including lawsuits, arbitration claims and regulatory matters. The Company is also involved in other reviews, investigations and proceedings by governmental and self-regulatory organizations regarding the business, which may result in adverse judgments, settlements, fines, penalties, injunctions and other relief. In many cases, however, it is inherently difficult to determine whether any loss is probable or reasonably possible or to estimate the amount or range of any potential loss, particularly where proceedings may be in relatively early stages. In the Company’s opinion, based on currently available information, the ultimate resolution of current matters will not have a material adverse impact on the Company’s financial position and results of operations as of March 31, 2025. However, resolution of one or more of these matters may have a material effect on the results of operations in any future period, depending upon the ultimate resolution of those matters and depending upon the level of income for such period. Overnight Financing As of both March 31, 2025 and December 31, 2024, MSCO had an available line of credit for short term overnight demand borrowing with BMO Harris Bank (“BMO Harris”) of up to $ 25 million. As of those dates, MSCO had no outstanding loan balance and there were no commitment fees or other restrictions on the line of credit. The Company utilizes customer or firm securities as a pledge for short-term borrowing needs. The interest expense for this credit line was $ 1,000 and $ 2,000 for the three months ended March 31, 2025 and 2024, respectively. There were no fees related to this line of credit for the three months ended March 31, 2025 and 2024. Credit Agreement On August 15, 2024, the Company entered into a Loan and Security Agreement (the “Credit Agreement”) with East West Bank (the “Lender”), a California banking corporation, dated as of July 29, 2024. The Credit Agreement provides for a revolving credit facility of up to $ 20,000,000 . The initial term of the Credit Agreement is two years. The Company may use any borrowings under the Credit Agreement for acquisitions, stock buybacks, and for general corporate purposes in an amount not to exceed $ 10,000,000 . Obligations under the Credit Agreement shall be guaranteed by John J. Gebbia, the Company’s Chief Executive Officer, Gloria E. Gebbia, a Director of the Company, and John J. Gebbia and Gloria E. Gebbia, as co-trustees of the John and Gloria Living Trust. Borrowings under the Credit Agreement bears interest on the outstanding daily balance at a rate of interest per annum equal to the greater of: (a) the one-month Term Secured Overnight Financing Rate (“Term SOFR”), as administered by CME Group Benchmark Administration plus 3.15 % and (b) 7.50 %. The origination fee is equal to one half of one percent ( 0.50 %) of the $ 20,000,000 revolver cap. The Credit Agreement contains customary affirmative covenants and negative covenants and requires the Company to maintain a minimum debt service coverage ratio of not less than 1.35:1.00 and minimum net capital of $ 43,000,000 . - 18 - BMO Credit Agreement On November 22, 2024, MSCO entered into a Credit Agreement (the “BMO Credit Agreement”) with BMO Bank N.A. (the “Lender”), a national banking association. The BMO Credit Agreement provides for a revolving credit facility of up to $ 20,000,000 . The Company may use any borrowings under the BMO Credit Agreement to finance NSCC Deposit Requirements (other than an Adequate Assurance Deposit) and withdrawals from a Reserve Account. As part of the agreement, the Company entered into a Parent Guaranty agreement guaranteeing repayment of any debt issued to MSCO. Borrowings under the BMO Credit Agreement bears interest on the outstanding daily balance at a rate of interest per annum equal 2.5 % plus the greater of: (a) Term SOFR for such day plus 0.11448 % and (b) Federal Funds Target Range – Upper Limit and (c) 0.25 %. The annual commitment fee is equal to one half of one percent ( 0.50 %) of the average daily unused portion of the commitment of $ 20,000,000 . The BMO Credit Agreement contains customary affirmative covenants and negative covenants and requires MSCO maintain minimum total regulatory capital of $ 45,000,000 , excess net capital of 20,000,000 , assets to total regulatory capital ratio of not more than 5.0 to 1.0, and a minimum liquidity ratio of not less than 1.0 . The Company satisfied its condition precedent to deliver a legal option to the Lender on December 18, 2024. There was no interest expense for the BMO Credit Agreement for the three months ended March 31, 2025 and 2024. The fee for this credit line was $23,000 for the three months ended March 31, 2025 and there was no fee expense for the three months ended March 31, 2024. NFS Contract Effective August 1, 2021, MSCO entered into an amendment to its clearing agreement with NFS that, among other things, extends the term of the arrangement for an additional four-year period commencing on August 1, 2021 and ending July 31, 2025. If the Company chooses to exit this agreement before the end of the contract term, the Company is under the obligation to pay an early termination fee upon occurrence pursuant to the table below: Date of Termination Early Termination Fee Prior to August 1, 2025 $ 3,250,000 For the three months ended March 31, 2025 and 2024, there has been no expense recognized for any early termination fees. The Company believes that it is unlikely it will have to make material payments related to early termination fees and has not recorded any contingent liability in the financial statements related to this arrangement. Technology Vendor The Company has entered into agreements with technology vendors for software development related to its Retail Platform. As of March 31, 2025, the Company incurred costs of approximately $ 4.1 million for these vendors. General Contingencies The Company’s general contingencies are included in Note 21 – Commitments, Contingencies, and Other in the Company’s 2024 Form 10-K. Other than the below, there have been no material updates to the Company’s general contingencies during the three months ended March 31, 2025. The Company is self-insured with respect to employee health claims. As part of this plan, the Company recognized expenses of $ 385,000 and $ 394,000 for the three months ended March 31, 2025 and 2024, respectively. The Company had an accrual of $ 102,000 and $ 76,000 as of March 31, 2025 and December 31, 2024, respectively, which represents the estimate of future expense to be recognized for claims incurred during the periods. The Company believes that its present insurance coverage and reserves are sufficient to cover currently estimated exposures, but there can be no assurance that the Company will not incur liabilities in excess of recorded reserves or in excess of its insurance limits. 17. Segment Reporting The Company operates as a wholly-owned subsidiary of the Parent and is engaged in a single line of business as a securities broker-dealer providing comprehensive brokerage services including custody and clearance of retail accounts, principal transaction and proprietary trading, market making, and securities lending. The Company’s CODM, its Chief Financial Officer, reviews operating and financial information of the Company as a whole as presented on the statements of operations as well as the financial table in Note 11 – Revenue Recognition, and uses net income as the key measure to evaluate the results of the business, predominately in the forecasting process, to manage the Company. The CODM has determined that all activities contribute to the core brokerage business and the Company operates as a single reportable segment. The Company’s operations constitute a single operating segment and therefore, a single reportable segment, because the CODM manages the business activities using information of the Company as a whole. The accounting policies used to measure the profit and loss of the segment are the same as those described in the summary of significant accounting policies. - 19 - 18. Employee Benefit Plans The Company sponsors a defined-contribution retirement plan under Section 401(k) of the Internal Revenue Code that covers substantially all employees (“401(k) plan”). Participant contributions to the 401(k) plan are voluntary and are subject to certain limitations. The Company may also make discretionary contributions to the plan. For 401(k) employee contribution matching, the Company incurred expense of $ 152,000 and $ 135,000 for the three months ended March 31, 2025 and 2024, respectively. On September 17, 2021, the Company’s shareholders approved the Siebert Financial Corp. 2021 Equity Incentive Plan (the “Plan”). The Plan provides for the grant of stock options, restricted stock, and other equity awards of the Company’s common stock to employees, officers, consultants, directors, affiliates and other service providers of the Company. There were 3 million shares reserved under the Plan and 1,152,000 and 2,214,000 and shares remained as of March 31, 2025 and December 31, 2024, respectively. The table below presents the Plan awards granted and the related fair values for the three months ended March 31, 2025. Shares Weighted- Average Grant Date Fair Value Nonvested as of December 31, 2024 150,000 $ 1.65 Forfeited ( 50,000 ) 1.65 Granted 1,112,000 2.69 Vested ( 237,000 ) 2.27 Nonvested as of March, 2025 975,000 $ 2.69 As of March 31, 2025, there was $ 2,483,000 of total unrecognized compensation cost related to nonvested shares granted. The cost is expected to be recognized over a weighted average period of 2.1 years. The Company recognized stock-based compensation expense of $ 554,000 and $ 85,000 for the three months ended March 31, 2025 and 2024, respectively. $ 554,000 and $ 62,000 of this expense is included in the line item “Employee compensation and benefits” for the three months ended March 31, 2025 and 2024, respectively. $ 0 and $ 23,000 of this expense is fully capitalized within the line item “Software, net” in the consolidated statements of financial condition. 19. Related Party Disclosures KCA KCA owns a license from the Muriel Siebert Estate / Foundation to use the names “Muriel Siebert & Co., Inc.” and “Siebert” within business activities, which expires in 2025. For the use of these names, KCA passed through to the Company its cost of $ 0 and $ 15,000 for the three months ended March 31, 2025 and 2024, respectively. Other than the above arrangements, KCA has earned no profit for providing any services to the Company as KCA passed through any revenue or expenses to the Company’s subsidiaries for the three months ended March 31, 2025 and 2024. PW PW brokers the insurance policies for related parties. Revenue for PW from related parties was $ 6,000 and $ 4,000 for the three months ended March 31, 2025 and 2024, respectively. - 20 - Gloria E. Gebbia, John J. Gebbia, and Gebbia Family Members The three sons of Gloria E. Gebbia and John J. Gebbia hold executive positions within the Company’s subsidiaries and their compensation was in aggregate $ 872,000 and $ 793,000 for the three months ended March 31, 2025 and 2024, respectively. Part of their compensation includes payments related to key revenue streams. On May 22, 2023, Gloria E. Gebbia issued a warrant to BCW Securities LLC, a Delaware limited liability company, to purchase 403,780 shares of common stock of the Company held by Gloria E. Gebbia at an exercise price of $ 2.15 per share. Refer to Note 6 - Kakaopay Transaction in the Company’s 2024 Form 10-K for further information. Gebbia Sullivan County Land Trust The Company operates on a month-to-month lease agreement for its branch office in Omaha, Nebraska with the Gebbia Sullivan County Land Trust, the trustee of which is a member of the Gebbia Family. For both the three months ended March 31, 2025 and 2024, rent expense was $ 15,000 for this branch office. The Company has completed construction of its branch office in Omaha, Nebraska. Refer to Note 5 – Property, Office Facilities, and Equipment, net for further detail. Credit Agreement On August 15, 2024, the Company entered into the Credit Agreement with the Lender whereby John J. Gebbia and Gloria E. Gebbia, along with the John and Gloria Living Trust, are guaranteeing the Company’s obligations under the Credit Agreement with the Lender. Refer to Note 16 - Commitments, Contingencies, and Other for more information. Gebbia Entertainment, LLC On August 12, 2024, the Company acquired 100 % of GE, a music and entertainment company owned by John J. Gebbia, Gloria E. Gebbia, and David Gebbia. Refer to Note 3 – Business Combinations in the Company’s 2024 Form 10-K for further information. Kakaopay and Affiliates On April 27, 2023, the Company entered into the First Tranche Stock Purchase Agreement, pursuant to which the Company agreed to issue to Kakaopay the First Tranche Shares at a per share price of Two Dollars Fifteen Cents ($ 2.15 ). Refer to Note 6 – Kakaopay Transaction in the Company’s 2024 Form 10-K for further information. MSCO entered into an agreement whereby it would provide an omnibus trading account for Kakaopay’s subsidiary, Kakao Pay Securities Corp., and provide trade execution services to Kakao Pay Securities Corp., subject to compliance with applicable U.S. laws, rules and regulations. RISE In September 2022, MSCO and RISE entered into a clearing arrangement whereby RISE would introduce clients to MSCO. As part of the agreement, RISE deposited a clearing fund escrow deposit of $ 50,000 to MSCO, and had excess cash of approximately $ 1.1 million and $ 1.2 million in its brokerage account at MSCO as of March 31, 2025 and December 31, 2024, respectively. The resulting assets of RISE and liabilities of MSCO are eliminated in consolidation. 20. Subsequent Events The Company has evaluated events that have occurred subsequent to March 31, 2025 and through May 13, 2025, the date of the filing of this Report. On April 14, 2025, the Company completed a minority investment of $ 1 million in cash in exchange for equity in a technology company. The investment was made to further the Company’s strategic initiatives in technology and customer acquisition. Based on the Company’s assessment, other than the event above, there have been no material subsequent events that occurred during such period that would require disclosure in this Report or would be required to be recognized in the financial statements as of March 31, 2025. - 21 - ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion provides a narrative of our financial performance and condition that should be read in conjunction with the accompanying financial statements and related notes included under Part I, Item 1 of this Report. In addition to our historical consolidated financial information, the following discussion contains forward-looking statements that reflect our plans, estimates, and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to these differences include those discussed below and elsewhere in our 2024 Form 10-K, particularly in Part I, Item 1A – Risk Factors. Overview We are a financial services company and provide a wide variety of financial services to our clients. We operate in business lines such as retail brokerage, investment advisory, insurance, and technology development through our wholly-owned and majority-owned subsidiaries. Results in the businesses in which we operate are highly correlated to general economic conditions and, more specifically, to the direction of the U.S. equity and fixed-income markets. Market volatility, overall market conditions, interest rates, economic, political, and regulatory trends, and industry competition are among the factors which could affect us and which are unpredictable and beyond our control. These factors affect the financial decisions made by market participants who include investors and competitors, impacting their level of participation in the financial markets. In addition, in periods of reduced financial market activity, profitability is likely to be adversely affected because certain expenses remain relatively fixed, including salaries and related costs, as well as portions of communications costs and occupancy expenses. Accordingly, earnings for any period should not be considered representative of earnings to be expected for any other period. Financial Overview In the first quarter of 2025, earnings per share were $0.22, compared to earnings per share of $0.09 in the first quarter of 2024. In the first quarter of 2025, our net revenues were $28.9 million and operating income before taxes was $10.5 million, compared to net revenues of $20.5 million and operating income before taxes of $5.1 million in the first quarter of 2024. Financial highlights as of March 31, 2025: ● Principal transactions increased by 270% to $12.9 million compared to the prior-year quarter ● Stock borrow / stock loan increased by 18% to 4.8 million compared to the prior-year quarter ● Advisory fees increased by 53% to $0.7 million compared to the prior-year quarter Investment in Equity Security During the three months ended March 31, 2025, Siebert acquired the Investment in Equity Security in connection with a private placement from a private U.S company that subsequently completed an initial public offering. These shares are subject to resale restrictions until they are registered with the SEC or an exemption from such registration requirements becomes available. The date of the registration of such resale is uncertain as of the date of this Report. Siebert valued the restricted shares of the Investment in Equity Security using a Finnerty option-pricing model including a discount of approximately 40% which included the lack of marketability and other factors. Refer to Note 4 – Fair Value Measurements for additional details. For the three months ended March 31, 2025, Siebert recorded an unrealized gain of approximately $9.2 million in relation to the Investment in Equity Security. However, due to the volatility of the price of the shares, which has declined significantly since March 31, 2025, we are uncertain as to the total unrealized or realized gain or loss that will be recognized from the Investment in Equity Security. Solely for illustrative purposes, on May 7, 2025, the closing share price of the Investment in Equity Security fell to $25.24 per share, compared with $83.51 per share ($50.11 per share after the 40% discount) as of March 31, 2025. Had the Company sold its shares on May 7, 2025, the total gain would have been approximately $3.9 million, instead of the $9.2 million unrealized gain recognized during the three months ended March 31, 2025. Because the decline reflects conditions arising after March 31, 2025, no adjustment has been made to the accompanying financial statements. The potential change in the market value of the Investment in Equity Security may materially impact the results of future periods. - 22 - Trends and Key Factors Affecting our Operations Market Risk Market risk is our risk of loss resulting from the impact of changes in market prices on our trading inventory and investment positions. We have exposure to market risk primarily through our broker-dealer trading operations. Through our broker-dealer subsidiary, we trade debt obligations and equity securities and maintain trading inventories to ensure availability of securities to facilitate client transactions. Inventory levels may fluctuate daily as a result of client demand. Our primary market risks relate to interest rates and equity prices. Equity risk results from changes in prices of equity securities, affecting the value of the equity securities and other instruments that derive their value from a particular stock. We may enter into underwriting commitments and, as a result, we may be subject to market risk on any unsold securities issued in the offerings to which we are committed. Risk exposure is controlled by limiting our participation, the transaction size, or through the syndication process. Interest Rates We are exposed to market risk from changes in interest rates. Such changes in interest rates primarily impact revenue from interest, marketing, and distribution fees. We primarily earn interest, marketing and distribution fees from margin interest charged on clients’ margin balances, interest on cash and securities segregated for regulatory purposes, and distribution fees from money market mutual funds in clients’ accounts. Securities segregated for regulatory purposes consist solely of U.S. government securities. If prices of U.S. government securities within our portfolio decline, we anticipate the impact to be temporary as we intend to hold these securities to maturity. We seek to mitigate this risk by managing the average maturities of our U.S. government securities portfolio and setting risk parameters for securities owned, at fair value. The following table presents simulated changes to net interest revenue over the next 12 months beginning as of March 31, 2025 and December 31, 2024, of a gradual increase or decrease in market interest rates relative to prevailing market rates at the end of each reporting period: As of March 31, 2025 December 31, 2024 Increase of 200 basis points 31 % 32 % Increase of 100 basis points 15 % 18 % Increase of 50 basis points 8 % 11 % Decrease of 50 basis points (7 )% (4 )% Decrease of 100 basis points (15 )% (11 )% Decrease of 200 basis points (30 )% (26 )% The difference in our simulated incremental increases and decreases in the market interest rates as of March 31, 2025 compared to December 31, 2024 is primarily due to an increase in the proportion of segregated cash to segregated securities and an increase in the proportion of margin debit balances to cash credit balances. Technology Initiatives At the end of 2023, we hired new technology personnel, changed our primary software development vendor, and made investments in technology development. Some of these technology investments include the development of a Siebert mobile retail trading application, online platform for our retail customer base and corporate services clients, as well as upgrades to our technological and operational infrastructure to support these platforms and future growth. We believe that these ongoing investments in technology will be key in meeting the needs of our retail customers, correspondent clearing, corporate services as well as our expansion into new markets and demographics. - 23 - Client Account and Activity Metrics The following tables set forth metrics we use in analyzing our client account and activity trends for the periods indicated. Client Account Metrics– Retail Customers As of March 31, 2025 December 31, 2024 Retail customer net worth (in billions) $ 16.1 $ 18.0 Retail customer margin debit balances (in billions) $ 0.4 $ 0.4 Retail customer credit balances (in billions) $ 0.4 $ 0.4 Retail customer money market fund value (in billions) $ 0.9 $ 0.8 Retail customer accounts 161,767 160,054 ● Retail customer net worth represents the total value of securities and cash in the retail customer accounts after deducting margin debits ● Retail customer margin debit balances represent credit extended to our customers to finance their purchases against current positions ● Retail customer credit balances represent client cash held in brokerage accounts ● Retail customer money market fund value represents all retail customers accounts invested in money market funds ● Retail customer accounts represent the number of retail customers Statements of Operations and Financial Condition Statements of Operations for the Three Months Ended March 31, 2025 and 2024 Revenue Commissions and fees for the three months ended March 31, 2025 were $2,102,000 and decreased by $198,000 from the corresponding period in the prior year, primarily due to market conditions. Interest, marketing and distribution fees for the three months ended March 31, 2025 were $6,945,000 and decreased by $1,818,000 from the corresponding period in the prior year primarily due to a decline in interest rates and change in customer asset mix. Principal transactions and proprietary trading for the three months ended March 31, 2025 were $12,961,000 and increased by $9,455,000 from the corresponding period in the prior year, primarily due to the factors discussed below. The increase in realized and unrealized gain on primarily riskless principal transactions was primarily due to the Company’s Investment in Equity Security. The income related to this investment is included in the “Unrealized gain on investment in equity security” line in the securities table below. Refer to Note 4 – Fair Value Measurement for additional detail. Below is a summary of the change in the principal transactions and proprietary trading line item for the periods presented. Three Months Ended March 31, 2025 2024 Increase (Decrease) Principal transactions and proprietary trading Realized and unrealized gain on primarily riskless principal transactions $ 3,712,000 $ 3,443,000 $ 269,000 Unrealized gain on investment in equity security 9,233,000 — 9,233,000 Realized and unrealized gain on portfolio of U.S. government securities 16,000 63,000 (47,000 ) Total Principal transactions and proprietary trading $ 12,961,000 $ 3,506,000 $ 9,455,000 Market making for the three months ended March 31, 2025 was $552,000 and decreased by $120,000 from the corresponding period in the prior year, primarily due to market conditions. Stock borrow / stock loan for the three months ended March 31, 2025 was $4,837,000 and increased by $739,000 from the corresponding period in the prior year, primarily due to growth in stock locate services and securities lending businesses. - 24 - Advisory fees for the three months ended March 31, 2025 were $748,000 and increased by $258,000 from the corresponding period in the prior year, primarily due to growth in platform assets. Other income for the three months ended March 31, 2025 was 774,000 and increased by $147,000 from the corresponding period in the prior year, primarily due to fees related to administrative services. Operating Expenses Employee compensation and benefits for the three months ended March 31, 2025 were $11,992,000 and increased by $1,546,000 from the corresponding period in the prior year, primarily due to an increase in commission payouts and equity compensation, as well as additional personnel related to technology initiatives, and new business lines including our investment banking division. Clearing fees, including execution costs for the three months ended March 31, 2025 were $454,000 and increased by $26,000 from the corresponding period in the prior year. Technology and communications expenses for the three months ended March 31, 2025 were $1,105,000 and increased by $229,000 from the corresponding period in the prior year, primarily due to an expansion of technological infrastructure. Other general and administrative expenses for the three months ended March 31, 2025 were $1,509,000 and increased by $480,000 from the corresponding period in the prior year primarily due to fees related to expansion into new businesses. Data processing expenses for the three months ended March 31, 2025 were $949,000 and increased by $198,000 from the corresponding period in the prior year, primarily due to increased market activities. Rent and occupancy expenses for the three months ended March 31, 2025 were $467,000 and decreased by $30,000 from the corresponding period in the prior year. Professional fees for the three months ended March 31, 2025 were $1,359,000 and increased by $322,000 from the corresponding period in the prior year primarily due to the establishment of the investment advisory committee. Depreciation and amortization expenses for the three months ended March 31, 2025 were $415,000 and increased by $160,000 from the corresponding period in the prior year, primarily due to an increase in depreciation related to the expansion of the technology infrastructure. Interest expense for the three months ended March 31, 2025 was $89,000 and increased by $38,000 from the corresponding period in the prior year. Advertising and promotion expense for the three months ended March 31, 2025 was $154,000 and increased by $100,000 from the corresponding period in the prior year, primarily due to an increase in marketing initiatives. Provision For (Benefit From) Income Taxes The provision from income taxes for the three months ended March 31, 2025 was $1,835,000 and increased by $420,000 from the corresponding period in the prior year. The change from the corresponding period in the prior year is primarily due to an increase in pre-tax earnings in the first quarter of 2025. Refer to Note 12 – Income Taxes for additional detail. Net Income (Loss) Attributable to Noncontrolling Interests As further discussed in Note 1 – Organization and Basis of Presentation, we consolidate RISE’s financial results into our financial statements and reflect the portion of RISE not held by Siebert as a noncontrolling interest in our financial statements. The net loss attributable to noncontrolling interests for the three months ended March 31, 2025 was $3,000 and increased by $2,000 from the corresponding period in the prior year. Statements of Financial Condition As of March 31, 2025 and December 31, 2024 Assets Assets as of March 31, 2025 were $534,187,000 and decreased by $14,519,000 from December 31, 2024, primarily due to a decrease in securities borrowed. Liabilities Liabilities as of March 31, 2025 were $439,915,000 and increased by $5,339,000 from December 31, 2024, primarily due to an increase in securities loaned partially offset by a decrease in payables to customers. - 25 - Liquidity and Capital Resources Overview As of March 31, 2025, a significant portion of our assets were liquid in nature, providing us with flexibility in financing our business. A significant portion of our assets not held by customers or used for stock borrow / stock loan consisted primarily of cash and cash equivalents, securities owned, at fair value, which are marked-to-market daily, and receivables from and deposits with broker-dealers and clearing organizations. We expect to use our available cash, cash equivalents, and potential future borrowings under our debt agreements and potential issuance of new debt or equity, to support and invest in our core business, including investing in new ways to serve our customers, potentially seeking strategic acquisitions to leverage existing capabilities, and for general capital needs (including capital, deposit, and collateral requirements imposed by regulators and SROs). Based on our current level of operations, we believe our available cash, available lines of credit, overall access to capital markets, and cash provided by operations will be adequate to meet our current liquidity needs for the foreseeable future. As of the date of this Report, other than the items detailed in the section below, there are no known or material events that would require us to use large amounts of our liquid assets to cover expenses. Kakaopay The net capital infusion from Kakaopay to Siebert from the First Tranche transaction was approximately $14.8 million after the issuance cost. This capital is currently being used to enhance our regulatory capital, and is primarily invested in U.S. government securities and is in the line item “Securities owned, at fair value” on the statements of financial condition. Refer to Note 6 – Kakaopay Transaction in our 2024 Form 10-K for further detail. Cash and Cash Equivalents Our cash and cash equivalents were $25.7 million and $32.6 million as of March 31, 2025 and December 31, 2024, respectively. Credit Agreement On August 15, 2024, we entered into the Credit Agreement with East West Bank providing a $20 million revolving credit facility, which offers substantial financial flexibility to support our strategic initiatives. This credit facility allows the Company to fund acquisitions, execute stock buybacks, and meet general corporate needs up to $10 million, ensuring access to capital for both growth and operational purposes. The two-year term of the Credit Agreement, combined with a competitive interest rate structure that is tied to either the one-month Term SOFR plus 3.15% or a minimum of 7.50%, provides a stable and predictable financing source. The personal guarantees provided by key executives, John J. Gebbia and Gloria E. Gebbia, and their trust, further strengthen the Company’s borrowing position and help secure favorable terms. BMO Credit Agreement On November 22, 2024, MSCO entered into a Credit Agreement (the “BMO Credit Agreement”) with BMO Harris Bank (“BMO Harris”). The BMO Credit Agreement provides for a revolving credit facility of up to $20,000,000. We may use any borrowings under the BMO Credit Agreement to finance NSCC Deposit Requirements (other than an Adequate Assurance Deposit) and withdrawals from a Reserve Account. As part of the agreement, we entered into a Parent Guaranty agreement guaranteeing repayment of any debt issued to MSCO. Borrowings under the BMO Credit Agreement bears interest on the outstanding daily balance at a rate of interest per annum equal 2.5% plus the greater of: (a) Term SOFR for such day plus 0.11448% and (b) Federal Funds Target Range – Upper Limit and (c) 0.25%. The annual commitment fee is equal to one half of one percent (0.50%) of the average daily unused portion of the commitment of $20,000,000. The BMO Credit Agreement contains customary affirmative covenants and negative covenants and requires MSCO maintain minimum total regulatory capital of $45,000,000, excess net capital of 20,000,000, assets to total regulatory capital ratio of not more than 5.0 to 1.0, and a minimum liquidity ratio of not less than 1.0. Debt Agreements We have $4.2 million outstanding on our mortgage with East West Bank and an unutilized line of credit for short term overnight demand borrowing of up to $25 million with BMO Harris as of March 31, 2025. As of March 31, 2025, we were in compliance with all covenants related to our mortgage agreement. - 26 - Cash Requirements The following table summarizes our short- and long-term material cash requirements as of March 31, 2025. Payments Due By Period 2025 2026 2027 2028 2029 Thereafter Total Operating lease commitments $ 781,000 $ 855,000 $ 613,000 $ 522,000 $ 58,000 $ — $ 2,829,000 Kakaopay fee (1) 1,500,000 1,000,000 — — — — 2,500,000 Mortgage with East West Bank (2) 65,000 91,000 95,000 98,000 112,000 3,744,000 4,205,000 Technology vendors (3) 383,000 — — — — — 383,000 Broadridge contract (4) 306,000 170,000 — — — — 476,000 Total $ 3,035,000 $ 2,116,000 $ 708,000 $ 620,000 $ 170,000 $ 3,744,000 $ 10,393,000 (1) Pursuant to the Settlement Agreement with Kakaopay, we will pay Kakaopay a fee of $5 million payable in ten quarterly installments that began in the first quarter of 2024. Refer to Note 6 – Kakaopay Transaction in our 2024 Form 10-K for further detail. (2) On December 30, 2021, we purchased the Miami office building and financed part of the purchase price with a mortgage with East West Bank. (3) We have entered into agreements with technology vendors for certain development projects related to our Retail Platform. As of March 31, 2025, we have incurred approximately $4.1 million out of the $4.4 million total budget for these vendors. (4) In June 2023, we entered into an amendment to its service agreement with Broadridge Securities Processing Solutions, LLC with a total minimum expense of approximately $1.2 million for this arrangement. Net Capital, Reserve Accounts, Segregation of Funds, and Other Regulatory Requirements MSCO is subject to the Uniform Net Capital Rules of the SEC (Rule 15c3-1) and the Customer Protection Rule (15c3-3) of the Exchange Act and maintains capital and segregated cash reserves in excess of regulatory requirements. Requirements under these regulations may vary; however, MSCO has adequate reserves and contingency funding plans in place to sufficiently meet any regulatory requirements. In addition to net capital requirements, as a self-clearing broker-dealer, MSCO is subject to cash deposit and collateral requirements with clearing houses, such as the DTCC and OCC, which may fluctuate significantly from time to time based upon the nature and size of clients’ trading activity and market volatility. RISE, as a member of FINRA, is subject to the SEC Uniform Net Capital Rule 15c3-1 and the corresponding regulatory capital requirements. MSCO can transfer funds to Siebert as long as MSCO maintains its liquidity and regulatory capital requirements. RISE can transfer funds to its shareholders, of which Siebert is entitled to its proportional ownership interest, as long as RISE maintains its liquidity and regulatory capital requirements. For the three ended March 31, 2025 and 2024, MSCO and RISE had sufficient net capital to meet their respective liquidity and regulatory capital requirements. Refer to Note 13 – Capital Requirements for more detail about our capital requirements. Cash Flows Cash used in operating activities consisted of net income adjusted for certain non-cash items. Net operating assets and liabilities at any specific point in time are subject to many variables, including variability in customer activity, the timing of cash receipts and payments, and vendor payment terms. The total changes in our statements of cash flows, especially our operating cash flow, are not necessarily indicative of the ongoing results of our business as we have customer assets and liabilities on our statements of financial condition. For the three months ended March 31, 2025, cash used in operating activities decreased by $12.5 million compared to the prior year period, which was primarily driven by net change in securities loaned, securities borrowed and payables to customers. For the three months ended March 31, 2025, cash used in investing activities decreased by $0.6 million compared to the prior year period, which was primarily driven by the New York office build out occurring in the prior year period. For the three months ended March 31, 2025, cash flows used in financing activities decreased by $4.8 million compared to 2024, which was primarily driven by the draws on the bank loan occurring in the prior year period. - 27 - Long Term Contracts Effective August 1, 2021, MSCO entered into an amendment to its clearing agreement with NFS that, among other things, extends the term of their arrangement for an additional four-year period commencing on August 1, 2021 and ending July 31, 2025. As part of this agreement, we received a one-time business development credit of $3 million, and NFS will pay us four annual credits of $100,000 over the term of the agreement. The amendment also provides for an early termination fee; however, as of March 31, 2025, we do not expect to terminate the contract with NFS before the end of the contract term. Refer to Note 10 – Deferred Contract Incentive and Note 16 – Commitments, Contingencies and Other for additional detail. Effective June 2023, MSCO entered into an amendment to its service agreement with Broadridge Securities Processing Solutions, LLC that, among other things, extends the term of their arrangement for a five-year period ending June 2028, with an option to terminate after three years. The total minimum expense for this arrangement is estimated at approximately $1.2 million over the duration of the contract. Off-Balance Sheet Arrangements We enter into various transactions to meet the needs of customers, conduct trading activities, and manage market risks and are, therefore, subject to varying degrees of market and credit risk. In the normal course of business, our customer activities involve the execution, settlement, and financing of various customer securities transactions. These activities may expose us to off-balance sheet risk in the event the customer or other broker is unable to fulfill their contracted obligations and we are forced to purchase or sell the financial instrument underlying the contract at a loss. There were no material losses for unsettled customer transactions for the three months ended March 31, 2025 and 2024. Refer to Note 14 – Financial Instruments with Off-Balance Sheet Risk for additional detail. Uncertain Tax Positions We account for uncertain tax positions in accordance with the authoritative guidance issued under ASC 740-10, which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. We may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits recognized in the financial statements from such position should be measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. ASC 740-10 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods and disclosure requirements. We recognize interest and penalties related to unrecognized tax benefits on the provision for income taxes line on the statements of operations. Accrued interest and penalties would be included on the related tax liability line on the statements of financial condition. As of both March 31, 2025 and December 31, 2024, the Company recorded an uncertain tax position of $1,354,000 related to various tax matters, which is included in the line item “Taxes payable” in the statements of financial condition. Critical Accounting Policies and Estimates Certain of our accounting policies that involve a higher degree of judgment and complexity are discussed in Part I, Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2024 Form 10-K. As of March 31, 2025, there have been no changes to our critical accounting policies or estimates. New Accounting Standards In December 2023, the FASB issued ASU 2023-09, “Improvements to Income Tax Disclosures” (“ASU 2023-09”). The ASU is intended to enhance the transparency and decision usefulness of income tax disclosures. The amendments in the ASU address investor requests for enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information. ASU 2023-09 will be effective for us for annual periods beginning after December 15, 2024, though early adoption is permitted. We are still evaluating the presentational effect that ASU 2023-09 will have on our consolidated financial statements, but we expect considerable changes to our income tax footnote. In November 2024, the FASB issued ASU “2024-03”, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures” (“ASU 2024-03”). The ASU is intended to enhance the transparency and decision usefulness of income statement expense disclosures by requiring greater disaggregation of certain expense categories. ASU 2024-03 will be effective for us for annual periods beginning after December 15, 2025, though early adoption is permitted. We are currently evaluating the impact that ASU 2024-03 will have on our consolidated financial statements and we anticipate the amendments will require significant changes to our expense disclosures. Recent Accounting Pronouncements Refer to Note 2 – Summary of Significant Accounting Policies for information regarding new Accounting Standards Updates (“ASU”s) issued by the FASB. - 28 - ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Financial Instruments Held For Trading Purposes We do not directly engage in derivative transactions, have no interest in any special purpose entity and have no liabilities, contingent or otherwise, for the debt of another entity. Financial Instruments Held For Purposes Other Than Trading We generally invest our cash and cash equivalents temporarily in dollar denominated bank account(s). These investments are not subject to material changes in value due to interest rate movements. We invest cash and securities segregated for regulatory purposes in dollar denominated bank accounts which are not subject to material changes in value due to interest rate movements. We also invest cash and securities segregated for regulatory purposes and securities owned, at fair value in U.S. government securities which may be subject to material changes in value due to interest rate movements. Securities owned, at fair value invested in U.S. government securities are generally purchased to enhance yields on required regulatory deposits. While the value of the government securities may be subject to material changes in value, we believe any reduction in value would be temporary since the securities would mature at par value. As noted in Item 2, Siebert valued the restricted shares of the Investment in Equity Security using a Finnerty option-pricing model, including a discount of approximately 40%, which included the lack of marketability and other factors. For the three months ended March 31, 2025, Siebert recorded an unrealized gain of approximately $9.2 million in relation to the Investment in Equity Security. However, due to the volatility of the price of the shares, which has declined significantly since March 31, 2025, we are uncertain as to the total unrealized or realized gain or loss that will be recognized from the Investment in Equity Security. Solely for illustrative purposes, on May 7, 2025, the closing share price of the Investment in Equity Security fell to $25.24 per share, compared with $83.51 per share ($50.11 per share after the 40% discount) as of March 31, 2025. Had the Company sold its shares on May 7, 2025, the total gain would have been approximately $3.9 million, instead of the $9.2 million unrealized gain recognized during the three months ended March 31, 2025. Because the decline reflects conditions arising after March 31, 2025, no adjustment has been made to the accompanying financial statements. The potential change in the market value of the Investment in Equity Security may materially impact the results of future periods. Customer transactions are cleared through clearing brokers on a fully disclosed basis and are also self-cleared by MSCO. If customers do not fulfill their contractual obligations any loss incurred in connection with the purchase or sale of securities at prevailing market prices to satisfy customer obligations may be incurred by Siebert. We regularly monitor the activity in customer accounts for compliance with margin requirements. We are exposed to the risk of loss on unsettled customer transactions if customers and other counterparties are unable to fulfill their contractual obligations. There were no material losses for unsettled customer transactions in the last five years. See Item 2. – Management’s Discussion and Analysis of Financial Condition and Results of Operations - Trends and Key Factors Affecting our Operations of this Report for our quantitative and qualitative disclosures about market risk. - 29 - ITEM 4. CONTROLS AND PROCEDURES Disclosure Controls and Procedures We carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and our Executive Vice President / Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this Report pursuant to Rule 13a-15(e) or Rule 15d-15(e) of the Securities Exchange of 1934, as amended (the “Exchange Act”). Based on its evaluation, our management, including our Chief Executive Officer and our Executive Vice President / Chief Financial Officer, concluded that as of the end of the period covered by this quarterly report, our disclosure controls and procedures were effective. Changes in Internal Control over Financial Reporting There were no changes in our internal control over financial reporting during the most recently completed fiscal quarter that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting - 30 - PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS In the normal course of business, we may be subject to various proceedings and claims arising from our business activities, including lawsuits, arbitration claims and regulatory matters. We are also involved in other reviews, investigations and proceedings by governmental and self-regulatory organizations regarding the business, which may result in adverse judgments, settlements, fines, penalties, injunctions and other relief. In many cases, however, it is inherently difficult to determine whether any loss is probable or reasonably possible or to estimate the amount or range of any potential loss, particularly where proceedings may be in relatively early stages. In our opinion, based on currently available information, the ultimate resolution of current matters will not have a material adverse impact on our financial position and results of operations. However, resolution of one or more of these matters may have a material effect on the results of operations in any future period, depending upon the ultimate resolution of those matters and depending upon the level of income for such period. ITEM 1A. RISK FACTORS In addition to the other information set forth in this Report, investors should carefully consider the risk factors discussed in Part I, Item 1A - Risk Factors in our 2024 Form 10-K. Each of such risk factors could materially affect our business, financial position, and results of operations. Except for the additional risk factor noted below, as of the date of this Report, there have been no material changes from the risk factors disclosed in our 2024 Form 10-K. The total unrealized or realized gain or loss that will be recognized from the Investment in Equity Security is uncertain, and the potential change in the market value of the Investment in Equity Security, which has declined significantly since March 31, 2025, may materially impact the results of future periods. During the three months ended March 31, 2025, Siebert acquired the Investment in Equity Security in connection with a private placement from a private U.S company that subsequently completed an initial public offering. These shares are subject to resale restrictions until the sale is registered with the SEC or an exemption from such registration requirements becomes available. The date of the registration of such resale is uncertain as of the date of this Report. Siebert valued the restricted shares of the Investment in Equity Security using a Finnerty option-pricing model, including a discount of approximately 40%, which included the lack of marketability and other factors. Refer to Note 4 – Fair Value Measurements for additional details. For the three months ended March 31, 2025, Siebert recorded an unrealized gain of approximately $9.2 million in relation to the Investment in Equity Security. However, due to the volatility of the price of the shares, which has declined significantly since March 31, 2025, we are uncertain as to the total unrealized or realized gain or loss that will be recognized from the Investment in Equity Security. Solely for illustrative purposes, on May 7, 2025, the closing share price of the Investment in Equity Security fell to $25.24 per share, compared with $83.51 per share ($50.11 per share after the 40% discount) as of March 31, 2025. Had the Company sold its shares on May 7, 2025, the total gain would have been approximately $3.9 million, instead of the $9.2 million unrealized gain recognized during the three months ended March 31, 2025. Because the decline reflects conditions arising after March 31, 2025, no adjustment has been made to the accompanying financial statements. The potential change in the market value of the Investment in Equity Security may materially impact the results of future periods. ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS None. ITEM 3. DEFAULTS UPON SENIOR SECURITIES None. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. ITEM 5. OTHER INFORMATION None of our directors or officers adopted , modified or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement during the three months ended March 31, 2025, as such terms are defined under Item 408(a) of Regulation S-K. - 31 - ITEM 6. EXHIBITS Exhibit No. Description of Document 31.1** Certification of Principal Executive Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 31.2** Certification of Principal Financial Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1**# Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 32.2**# Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 101.INS Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document). 101.SCH Inline XBRL Taxonomy Extension Schema Document. 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document. 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document. 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document. 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document. 104 Cover Page Interactive Data File (embedded with Inline XBRL document). ** Filed herewith # This certification is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (Exchange Act), or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act. - 32 - SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized. SIEBERT FINANCIAL CORP. By: /s/ John J. Gebbia John J. Gebbia Chief Executive Officer (Principal executive officer) By: /s/ Andrew H. Reich Andrew H. Reich Executive Vice President, Chief Operating Officer, Chief Financial Officer, and Secretary (Principal financial and accounting officer) Dated: May 13, 2025 - 33 -