MDWerks' Losses Mount Amid Revenue Decline, Going Concern Doubts

TL;DR

**MDWK is bleeding cash and its future is highly uncertain; steer clear unless you're a high-risk speculator.**

AI Summary

MDWerks, Inc. (MDWK) reported a significant net loss of $2,984,683 for the nine months ended September 30, 2025, a substantial increase from the $909,480 net loss in the same period of 2024. Revenue declined to $1,714,680 for the nine months ended September 30, 2025, down from $2,015,261 in the prior year, representing a 14.9% decrease. The company's gross profit turned into a gross loss of $30,495 for the nine-month period, a sharp contrast to the $956,173 gross profit in 2024. Operating expenses surged, with general and administrative expenses rising to $2,099,717 from $1,539,442, and salaries and wages increasing dramatically to $568,325 from $48,443. Cash increased to $181,278 as of September 30, 2025, from $11,159 at December 31, 2024, primarily due to $2,339,400 in proceeds from subscription agreements. The company's accumulated deficit grew to $5,345,188, and it continues to face substantial doubt about its ability to continue as a going concern.

Why It Matters

MDWerks' deteriorating financial performance, marked by a significant net loss and declining revenue, signals serious challenges for investors. The substantial increase in operating expenses, particularly salaries and wages, without a corresponding revenue boost, raises questions about cost management and operational efficiency. For employees, the 'going concern' warning could indicate job insecurity, while customers might face uncertainty regarding product availability or service continuity from its Two Trees Beverage Co. and RF Specialties, LLC subsidiaries. In a competitive market, MDWerks' inability to generate profit and its reliance on external financing for survival could make it an unattractive partner or acquisition target, impacting its long-term viability.

Risk Assessment

Risk Level: high — MDWerks reported a net loss of $2,984,683 for the nine months ended September 30, 2025, and an accumulated deficit of $5,345,188, which raises substantial doubt about its ability to continue as a going concern. The company's revenue decreased by 14.9% to $1,714,680, and it incurred a gross loss of $30,495 for the nine-month period, indicating fundamental operational challenges.

Analyst Insight

Investors should exercise extreme caution and consider avoiding MDWK stock given the significant net losses, declining revenue, and explicit 'going concern' warning. Potential investors should wait for clear evidence of sustained profitability and a robust business plan that addresses the liquidity issues and accumulated deficit before considering any investment.

Financial Highlights

revenue

$1,714,680

total Assets

$4,368,967

total Debt

$3,196,318

net Income

-$2,984,683

gross Margin

-1.78%

cash Position

$181,278

revenue Growth

-14.9%

Key Numbers

• $2.98M — Net Loss (Increased from $0.91M in prior year, indicating worsening financial health.)
• $5.35M — Accumulated Deficit (Significant increase, highlighting long-term unprofitability and 'going concern' risk.)
• $1.71M — Revenue (Decreased by 14.9% from $2.02M, showing a decline in sales.)
• $30.5K — Gross Loss (Shifted from a $0.96M gross profit, indicating core business unprofitability.)
• $568.3K — Salaries and Wages (Increased significantly from $48.4K, contributing to higher operating expenses.)
• $181.3K — Cash (Increased from $11.2K, primarily due to financing activities, not operations.)
• 227.6M — Common Shares Outstanding (Increased from 204.7M, indicating dilution from capital raises.)
• $2.34M — Proceeds from Subscription Agreements (Key source of cash, highlighting reliance on external financing.)

Key Players & Entities

• MDWerks, Inc. (company) — registrant
• Two Trees Beverage Co. (company) — wholly owned subsidiary, alcoholic beverage producer
• RF Specialties, LLC (company) — wholly owned subsidiary, Radio Frequency applications
• Keith A. Mort (person) — sole member of RF Specialties, LLC
• SEC (regulator) — Securities and Exchange Commission
• $2,984,683 (dollar_amount) — net loss for nine months ended September 30, 2025
• $5,345,188 (dollar_amount) — accumulated deficit as of September 30, 2025
• $1,714,680 (dollar_amount) — revenue for nine months ended September 30, 2025
• $30,495 (dollar_amount) — gross loss for nine months ended September 30, 2025
• $181,278 (dollar_amount) — cash balance as of September 30, 2025

FAQ

Risk Factors

• Going Concern Uncertainty [high — financial]: MDWerks, Inc. faces substantial doubt about its ability to continue as a going concern. The company reported a net loss of $2,984,683 for the nine months ended September 30, 2025, a significant increase from the prior year's loss of $909,480. This, coupled with a declining revenue and a shift to a gross loss, highlights severe financial distress.
• Deteriorating Profitability [high — financial]: The company experienced a significant decline in gross profit, turning into a gross loss of $30,495 for the nine months ended September 30, 2025, compared to a gross profit of $956,173 in the same period of 2024. This indicates core business operations are no longer profitable.
• Surging Operating Expenses [high — operational]: Operating expenses have escalated, with General and Administrative expenses rising to $2,099,717 from $1,539,442 and Salaries and Wages increasing dramatically to $568,325 from $48,443 for the nine-month period. This rapid cost increase exacerbates the net loss.
• Revenue Decline [medium — financial]: Revenue decreased by 14.9% to $1,714,680 for the nine months ended September 30, 2025, down from $2,015,261 in the prior year. This downward trend in sales is a primary contributor to the worsening financial performance.
• Reliance on External Financing [medium — financial]: The increase in cash to $181,278 from $11,159 was primarily driven by $2,339,400 in proceeds from subscription agreements. This highlights a significant reliance on external funding rather than operational cash generation.
• Growing Accumulated Deficit [high — financial]: The company's accumulated deficit has grown to $5,345,188, indicating a long history of unprofitability. This substantial deficit further supports the 'going concern' risk.
• Shareholder Dilution [medium — financial]: The number of common shares outstanding increased from 204,744,872 to 227,574,910. This 11.1% increase suggests significant dilution resulting from capital raises to fund operations.

Industry Context

The competitive landscape for companies like MDWerks is often characterized by rapid technological advancements and evolving customer demands. Companies in this sector typically face pressure to innovate while managing significant R&D and operational costs. Market trends can shift quickly, impacting revenue streams and profitability.

Regulatory Implications

As a publicly traded entity, MDWerks is subject to SEC regulations and reporting requirements. Failure to address financial instability could lead to delisting or increased scrutiny. Compliance with accounting standards for revenue recognition and expense reporting is crucial.

What Investors Should Do

1. Monitor cash burn rate closely.
2. Scrutinize future financing activities.
3. Evaluate the strategy behind the surge in salaries and wages.
4. Assess the viability of the core business model.

Key Dates

• 2025-09-30: Nine Months Ended — Reporting period showing a significant net loss of $2,984,683 and a 14.9% revenue decline, highlighting severe financial deterioration.
• 2024-09-30: Nine Months Ended — Prior year period for comparison, showing a net loss of $909,480 and revenue of $2,015,261, indicating a worsening financial trend.
• 2025-09-30: Balance Sheet Date — Shows increased cash of $181,278 (up from $11,159) primarily from financing, but also a substantial accumulated deficit of $5,345,188.
• 2024-12-31: Balance Sheet Date — Prior year-end balance sheet showing lower cash ($11,159) and accumulated deficit ($2,360,505).

Glossary

Accumulated deficit

The total net losses of a company since its inception that have not been offset by net gains. It represents a negative balance in retained earnings. (MDWerks' accumulated deficit has grown to $5,345,188, indicating persistent unprofitability and a key factor in the 'going concern' assessment.)

Going concern

A business's ability to continue operating for the foreseeable future without the threat of liquidation. Auditors must assess this when reviewing financial statements. (MDWerks explicitly states there is 'substantial doubt' about its ability to continue as a going concern, a critical warning for investors.)

Gross loss

Occurs when the cost of revenue exceeds the revenue generated. It means the company is losing money on its core product or service sales before considering other operating expenses. (MDWerks has shifted from a gross profit of $956,173 to a gross loss of $30,495, indicating a fundamental problem with its cost of goods sold or pricing strategy.)

Subscription agreements

Contracts where a customer agrees to pay for a service or product on a recurring basis, often monthly or annually. (Proceeds from these agreements ($2,339,400) were the primary source of MDWerks' increased cash, highlighting reliance on this financing method.)

Additional paid in capital

The amount of capital a company has received from investors in exchange for stock, exceeding the stock's par value. (This account has significantly increased to $6,215,262, reflecting substantial capital infusions, likely through stock issuances.)

Year-Over-Year Comparison

MDWerks has seen a significant deterioration in its financial performance compared to the prior year. Revenue declined by 14.9% to $1.71 million, while the net loss widened dramatically from $0.91 million to $2.98 million. Most concerning is the shift from a gross profit of $0.96 million to a gross loss of $30,495, indicating core operational unprofitability. Operating expenses, particularly salaries and wages, have surged, exacerbating the losses and increasing the 'going concern' risk.

Filing Documents

• form10-q.htm (10-Q) — 1279KB
• ex31-1.htm (EX-31.1) — 12KB
• ex31-2.htm (EX-31.2) — 12KB
• ex32-1.htm (EX-32.1) — 7KB
• ex32-2.htm (EX-32.2) — 7KB
• 0001493152-25-023180.txt ( ) — 6968KB
• mdwk-20250930.xsd (EX-101.SCH) — 41KB
• mdwk-20250930_cal.xml (EX-101.CAL) — 54KB
• mdwk-20250930_def.xml (EX-101.DEF) — 235KB
• mdwk-20250930_lab.xml (EX-101.LAB) — 403KB
• mdwk-20250930_pre.xml (EX-101.PRE) — 340KB
• form10-q_htm.xml (XML) — 1196KB

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

Management's Discussion and Analysis of Financial Condition and Results of Operations 4 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 10 Item 4.

Controls and Procedures

Controls and Procedures 10

—OTHER INFORMATION

PART II—OTHER INFORMATION 11 Item 1.

Legal Proceedings

Legal Proceedings 11 Item 1A.

Risk Factors

Risk Factors 11 Item 2. Unregistered Sales of Securities and Use of Proceeds 11 Item 3. Defaults Upon Senior Securities 11 Item 4. Mine Safety Disclosure 11 Item 5. Other Information 11 Item 6. Exhibits 12

SIGNATURES

SIGNATURES 13 EXHIBIT 31.1 EXHIBIT 31.2 EXHIBIT 32.1 2 Forward-Looking Various laws. The words "estimate", "plan", "anticipate", "expect", "intend", "believe", "project", "target", "budget", "may", "can", "will", "would", "could", "should", "seeks", or "scheduled to", or other similar words, or negatives of these terms or other variations of these terms or comparable language or any discussion of strategy or intentions identify forward-looking statements. These cautionary statements are being made pursuant to the Securities Act, the Exchange Act and the PSLRA with the intention of obtaining the benefit of the "safe harbor" provisions of such laws. These statements involve known and unknown risks, uncertainties, assumptions, and other factors that may cause our actual results, performance or achievements to be materially different from any results, performance, or achievements expressed or implied by such forward-looking statements. Forward-looking statements are based on current expectations. Although we have attempted to identify important factors that could cause actual results to differ materially from those described in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. Although we base these forward-looking statements on assumptions that we believe are reasonable when made, we caution you that forward-looking statements are not guarantees of future performance and that our actual results, performance or achievements may differ materially from those made in or suggested by the forward-looking statements contained in this Quarterly Report on Form 10-Q. In addition, even if our results, performance, or achievements are consistent with the forward-looking

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) F-6 F-1 MDwerks, Inc. Consolidated Balance Sheets (Unaudited) September 30, 2025 December 31, 2024 Assets Current Assets Cash $ 181,278 $ 11,159 Accounts receivable, net 117,967 109,142 Inventory 1,024,057 236,863 Prepaid expenses 105,836 17,000 Total Current Assets 1,429,138 374,164 Fixed assets, net 1,212,027 585,025 Intangible assets, net 516,482 558,784 Right-of-use asset 728,662 915,803 Goodwill 466,648 466,648 Other non-current assets 16,010 16,010 Total Assets $ 4,368,967 $ 2,916,434 Liabilities and Stockholders' Equity Current Liabilities Accounts payable and accrued expenses $ 1,588,261 $ 822,111 Accounts payable – related party - 46,812 Notes payable, current 195,904 134,557 Notes payable – current related party 17,500 123,000 Notes payable 17,500 123,000 Deferred revenue 386,180 226,066 Right-of-use liability, current portion 163,490 266,315 Total Current Liabilities 2,351,335 1,618,861 Notes payable – related party, net of current portion 150,000 - Notes payable, net of current portion 99,556 231,370 Right-of use liability, net of current portion 595,427 695,175 Total Liabilities 3,196,318 2,545,406 Stockholders' Equity Preferred stock, par value $ 0.001 ; 10,000,000 shares authorized, of which 0 were issued and outstanding - - Common stock, par value $ 0.001 ; 300,000,000 shares authorized, of which 227,574,910 and 204,744,872 shares were issued and outstanding at September 30, 2025 and December 31, 2024, respectively 227,575 204,745 Additional paid in capital 6,215,262 2,511,788 Subscription payable 75,000 15,000 Accumulated deficit ( 5,345,188 ) ( 2,360,505 ) Total Stockholders' Equity 1,172,649 371,028 Total Liabilities and Stockholders' Equity $ 4,368,967 $ 2,916,434 The accompanying notes are an integral part of these unaudited consolidated financi

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