Lottery.com Narrows Q1 Loss to $3.3M Amid Revenue Dip, Cash Boost

Ticker: LTRYW · Form: 10-Q/A · Filed: Oct 15, 2025 · CIK: 1673481

Sentiment: bearish

Topics: SEC Filing, 10-Q/A, Financial Performance, Going Concern, Nasdaq Compliance, Online Lottery, Cash Flow

Related Tickers: LTRYW

TL;DR

**LTRYW is still a dumpster fire, despite a smaller loss; cash is up, but revenue is down and Nasdaq compliance is a pipe dream.**

AI Summary

Lottery.com Inc. (LTRYW) filed a 10-Q/A for the quarter ended March 31, 2025, primarily to amend its corporate phone number and condensed consolidated statements of cash flows. The company reported a net loss of $3,295,020 for the three months ended March 31, 2025, a significant improvement from the $5,753,872 net loss in the same period of 2024. Revenue decreased to $223,849 in Q1 2025 from $259,319 in Q1 2024, representing a 13.68% decline. Despite the revenue drop, gross profit fell even more sharply by 65.04% to $61,381 from $175,532 year-over-year, largely due to a substantial increase in cost of revenue from $83,787 to $162,468. Operating expenses saw a positive reduction, decreasing from $5,770,361 in Q1 2024 to $3,541,363 in Q1 2025, driven by lower personnel costs and professional fees. Cash increased significantly to $468,677 as of March 31, 2025, up from $68,035 at December 31, 2024, primarily due to $924,900 in cash provided by operating activities and $697,022 from financing activities. The company continues to face substantial risks, including ongoing legal proceedings, the need for additional capital to restart operations, and non-compliance with Nasdaq listing standards.

Why It Matters

This amended filing highlights Lottery.com's persistent operational challenges and precarious financial position, despite a reduced net loss. The significant decline in revenue and gross profit, coupled with the ongoing need for additional capital and non-compliance with Nasdaq listing standards, signals severe headwinds for investors. For employees, the previous furloughing of the majority of staff and suspension of lottery game sales operations underscore job insecurity. Customers face uncertainty regarding service continuity, while the broader market observes a company struggling to regain footing in the competitive online lottery space, potentially impacting investor confidence in similar speculative ventures.

Risk Assessment

Risk Level: high — The company explicitly states, "we may not be able to continue as a going concern" and "we need additional capital... Such capital may not be available on commercially acceptable terms, if at all." Furthermore, Lottery.com is "currently not in compliance with the continued listing standards of Nasdaq," indicating a high risk of delisting and severely limited liquidity for investors.

Analyst Insight

Investors should exercise extreme caution and consider divesting, given the explicit going concern warning, non-compliance with Nasdaq listing standards, and the ongoing need for capital. The reduced net loss is overshadowed by declining revenue and gross profit, suggesting fundamental business model weaknesses persist.

Financial Highlights

debt To Equity
1.44
revenue
$223,849
operating Margin
-1582.1%
total Assets
$53,439,131
total Debt
$31,532,777
net Income
-$3,295,020
eps
-$0.14
gross Margin
27.42%
cash Position
$468,677
revenue Growth
-13.68%

Key Numbers

Key Players & Entities

FAQ

What were Lottery.com Inc.'s revenues for the first quarter of 2025?

Lottery.com Inc. reported revenues of $223,849 for the three months ended March 31, 2025. This represents a decrease from $259,319 in the same period of 2024.

How much was Lottery.com Inc.'s net loss in Q1 2025?

Lottery.com Inc.'s net loss for the three months ended March 31, 2025, was $3,295,020. This is an improvement compared to a net loss of $5,753,872 in Q1 2024.

Did Lottery.com Inc. generate positive cash flow from operations in Q1 2025?

Yes, Lottery.com Inc. generated $924,900 in net cash from operating activities for the three months ended March 31, 2025. This is a significant improvement from using $1,077,990 in operating activities during Q1 2024.

What is the primary reason for Lottery.com Inc.'s 10-Q/A filing?

Lottery.com Inc. filed this Amendment No. 1 (10-Q/A) to amend and revise its corporate phone number and the Condensed Consolidated Statements of Cash Flows from its originally filed Quarterly Report on Form 10-Q for the quarter ended March 31, 2025.

Is Lottery.com Inc. in compliance with Nasdaq listing standards?

No, Lottery.com Inc. explicitly states in the filing that it is "currently not in compliance with the continued listing standards of Nasdaq" and "may not be able to regain compliance with Nasdaq's continued listing standards in the future."

What are the key risks highlighted in Lottery.com Inc.'s filing?

Key risks include the possibility of not continuing as a going concern, the need for additional capital which may not be available, ongoing legal proceedings and investigations, and the inability to comply with Nasdaq listing standards.

How did Lottery.com Inc.'s operating expenses change in Q1 2025 compared to Q1 2024?

Total operating expenses for Lottery.com Inc. decreased to $3,541,363 in Q1 2025 from $5,770,361 in Q1 2024. This reduction was primarily driven by lower personnel costs and professional fees.

What was Lottery.com Inc.'s cash balance at the end of Q1 2025?

As of March 31, 2025, Lottery.com Inc. reported a cash balance of $468,677. This is a substantial increase from $68,035 at December 31, 2024.

What impact did stock issuance have on Lottery.com Inc.'s equity in Q1 2025?

In Q1 2025, Lottery.com Inc. issued stock for debt conversion valued at $211,020 and stock in lieu of cash valued at $2,673,408. This contributed to an increase in common stock shares outstanding from 18,326,855 to 26,700,060.

Why did Lottery.com Inc. furlough employees and suspend operations in July 2022?

Lottery.com Inc. furloughed the majority of its employees and suspended lottery game sales operations in July 2022 after determining it did not have sufficient financial resources to fund operations or pay certain existing obligations, including payroll.

Risk Factors

Industry Context

The lottery and gaming industry is highly regulated and competitive, with significant shifts towards digital platforms. Companies in this sector face challenges related to customer acquisition, retention, regulatory compliance, and technological innovation. Lottery.com operates in a space where trust and security are paramount, and the transition from traditional lottery sales to online platforms requires substantial investment and adaptation.

Regulatory Implications

Lottery.com Inc. is facing non-compliance with Nasdaq listing standards, which carries a high risk of delisting. This situation necessitates immediate corrective actions to regain compliance or explore alternative listing venues. Failure to do so could severely impact investor confidence and market access.

What Investors Should Do

  1. Monitor capital raising efforts closely.
  2. Assess the feasibility of regaining Nasdaq compliance.
  3. Analyze the sustainability of operational improvements.
  4. Evaluate the impact of share dilution.

Glossary

10-Q/A
A quarterly report filed with the SEC that has been amended. The 'A' signifies an amendment to a previously filed report. (This filing is an amended quarterly report, indicating that the company is correcting or updating information previously submitted.)
Condensed Consolidated Statements of Operations and Comprehensive Loss
A financial statement showing a company's revenues, expenses, and net income (or loss) over a specific period, presented in a summarized format and including all subsidiaries. (Provides insight into the company's profitability during the first quarter of 2025 and 2024.)
Cost of Revenue
The direct costs attributable to the production or purchase of the goods or services sold by a company. (A significant increase in cost of revenue from $83,787 to $162,468 in Q1 2025 is a key reason for the sharp decline in gross profit.)
Accumulated Deficit
The total net losses of a company since its inception that have not been offset by net income. (The company has a substantial accumulated deficit of $266,775,196 as of March 31, 2025, highlighting its history of unprofitability.)
Additional Paid-in Capital
The amount investors have paid for stock above its par or stated value. (Represents a significant portion of the company's equity, indicating substantial capital raised from stock issuance over time.)
Noncontrolling Interest
The portion of equity in a subsidiary that is not attributable to the parent company. (Indicates that Lottery.com Inc. has subsidiaries where other parties hold an ownership stake.)

Year-Over-Year Comparison

Compared to the prior year's first quarter, Lottery.com Inc. reported a reduced net loss ($3.3M vs. $5.8M), but this was accompanied by a 13.68% decline in revenue ($223.8K vs. $259.3K). Gross profit saw a dramatic decrease of 65.04% due to a sharp rise in the cost of revenue. While operating expenses were significantly reduced, the company's financial position remains precarious, with substantial current liabilities and ongoing risks including legal proceedings and Nasdaq non-compliance.

Filing Stats: 4,399 words · 18 min read · ~15 pages · Grade level 14.3 · Accepted 2025-10-15 14:10:49

Key Financial Figures

Filing Documents

– Item 1 Condensed

Part I – Item 1 Condensed Consolodated Staements of Cash Flows The other Items of the Original Report have not been amended. The only changes to the Original Report are those related to the matters described below and only in the items listed above. Except as described herein, this Amended Report does not modify, amend or update any of the other financial information or other information contained in the Original Report. In addition, in accordance with SEC rules, this Amended Report includes updated certifications from our Chief Executive Officer and Chief Financial Officer as Exhibits 31.1 and 32.1. Otherwise, the information contained in this Amended Report is as of the date of the Original Report and does not reflect any information or events occurring after the date of the Original Report. Such subsequent information or events include, among other things, the information and events described in our Current Reports on Form 8-K filed subsequent to the date of the Original Report and the information and events described in Amendment No. 1 to our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on April 22, 2025 (the "Amended Annual Report"). For a description of such subsequent information and events, please read our reports filed pursuant to the Exchange Act subsequent to the date of the Original Report, which update and supersede certain information contained in the Original Report and this Amended Report. TABLE OF CONTENTS Page

Financial Information

Part I. Financial Information

Consolidated Financial Statements

Item 1. Consolidated Financial Statements 1 Condensed Consolidated Balance Sheets as of March 31, 2025 (unaudited) and December 31, 2024 F-1 Condensed Consolidated Statements of Operations and Comprehensive Loss for the three months ended March 31, 2025 and 2024 (unaudited) F-2 Condensed Consolidated Statements of Equity for the three months ended March 31, 2025 and 2024 (unaudited) F-3 Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2025 and 2024 (unaudited) F-4 Notes to Condensed Consolidated Financial Statements (unaudited) F-5

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 2

Quantitative and Qualitative Disclosures about Market Risk

Item 3. Quantitative and Qualitative Disclosures about Market Risk 15

Controls and Procedures

Item 4. Controls and Procedures 15

Other Information

Part II. Other Information

Legal Proceedings

Item 1. Legal Proceedings 17

Risk Factors

Item 1A. Risk Factors 20

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 21

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 21

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 21

Other Information

Item 5. Other Information 21

Exhibits

Item 6. Exhibits 21 i CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This Amended Quarterly Report on Form 10-Q/A (this "Report") contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), including statements about the financial condition, results of operations, earnings outlook and prospects of Lottery.com Inc. ("Lottery.com", the "Company", "we" or "us"). Forward-looking statements appear in a number of places in this Report, including, without limitation, under the heading in Part I, " Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. " In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. Forward-looking statements are typically identified by words such as "plan," "believe," "expect," "anticipate," "intend," "outlook," "estimate," "forecast," "project," "continue," "could," "may," "might," "possible," "potential," "predict," "should," "would" and other similar words and expressions, but the absence of these words does not mean that a statement is not forward-looking.

Forward-looking statements are

Forward-looking statements are based on the current expectations of the management of Lottery.com and are inherently subject to uncertainties and changes in circumstances and their potential effects and speak only as of the date of such statement. There can be no assurance that future developments will be those that have been anticipated. These forward-looking statements involve a number of risks, uncertainties or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors discussed and identified in the section entitled "Risk Factors" in our Annual Report on Form 10-K/A for the year ended December 31, 2024 (the Amended "Annual Report") which was filed on April 22, 2025 and in this Report, as such factors may be updated in our periodic reports filed with the Securities and Exchange Commission (the "SEC"), as well as the following: The findings of the previously disclosed Internal Investigation (as defined herein) and other matters have exposed us to a number of legal proceedings, investigations and inquiries, resulted in significant legal and other expenses, required significant time and attention from our senior management, among other adverse impacts. We and certain of our former officers are, and in the future, we or our officers and directors may become, the subject of legal proceedings, investigations and inquiries by governmental agencies with respect to the findings of the Internal Investigation and other matters, which could have a material adverse effect on our reputation, business, financial condition, cash flows and results of operations, and could result in additional claims and material liabilities. We have been named as a defendant in a number of lawsuits filed by purchasers of our securities, including class action lawsuits that could have a material adverse impact on our b

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements Page Condensed Consolidated Balance Sheets as of March 31, 2025 (unaudited) and December 31, 2024 F-1 Condensed Consolidated Statements of Operations and Comprehensive Loss for the three months ended March 31, 2025 and 2024 (unaudited) F-2 Condensed Consolidated Statements of Equity for the three months ended March 31, 2025 and 2024 (unaudited) F-3 Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2025 and 2024 (unaudited) F-4 Notes to Condensed Consolidated Financial Statements (unaudited) F-5 1 LOTTERY.COM INC. CONDENSED CONSOLIDATED BALANCE SHEETS March 31, 2025 December 31, 2024 ASSETS Current assets: Cash $ 468,677 $ 68,035 Restricted Cash - - Accounts receivable 487,133 494,129 Prepaid expenses 14,373,230 14,449,333 Other current assets 1,130,272 880,961 Total current assets 16,459,312 15,892,458 Notes receivable 2,000,000 2,250,000 Investments 250,000 250,000 Goodwill 9,061,675 9,061,675 Intangible assets, net 12,780,032 12,569,165 Property and equipment, net 3,426 12,124 Other long-term assets 12,884,686 12,906,849 Total assets $ 53,439,131 $ 52,942,271 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Trade payables $ 8,496,714 $ 8,241,311 Deferred revenue 223,214 250,000 Notes payable - current 6,212,536 5,735,110 Accrued interest 1,270,044 1,218,864 Accrued and other expenses 11,268,723 12,161,311 Other liabilities 4,061,546 2,790,845 Total current liabilities 31,532,777 30,397,441 Long-term liabilities: Convertible debt, net - non current - - Other long-term liabilities - - Total long-term liabilities - - Commitments and contingencies (Note 13) - - Total liabilities 31,532,777 30,397,442 Equity Controlling Interest Equity Controlling Interest Preferred Stock, par value $ 0.001 , 1,000,000 shares authorized, none issued and outstanding - -

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