Mobile Global Esports Files Q2 2024 10-Q

TL;DR

MGE filed its Q2 10-Q. Financials and operations update.

AI Summary

Mobile Global Esports, Inc. filed its 10-Q for the quarter ended June 30, 2024. The filing details the company's financial performance and operational status. The company is incorporated in Delaware and its principal executive offices are located in Westport, Connecticut.

Why It Matters

This filing provides investors with an update on Mobile Global Esports' financial health and operational progress during the second quarter of 2024.

Risk Assessment

Risk Level: medium — As a 10-Q filing, it represents a standard financial disclosure for a public company, but the specific financial health and market position of Mobile Global Esports are not detailed enough in this header to assess a definitive risk level.

Key Players & Entities

• Mobile Global Esports, Inc. (company) — Registrant
• June 30, 2024 (date) — Fiscal quarter end date
• 001-41458 (other) — Commission File Number
• 86-2684455 (other) — I.R.S. Employer Identification No.
• Westport, Connecticut (location) — Principal Executive Offices

FAQ

Key Financial Figures

• $0.001 — ange on which registered Common stock, $0.001 par value per share MGAM OTC Pink Sheet

Filing Documents

• ea0212551-10q_mobile.htm (10-Q) — 456KB
• ea021255101ex31-1_mobile.htm (EX-31.1) — 11KB
• ea021255101ex31-2_mobile.htm (EX-31.2) — 11KB
• ea021255101ex32-1_mobile.htm (EX-32.1) — 4KB
• ea021255101ex32-2_mobile.htm (EX-32.2) — 4KB
• 0001213900-24-088172.txt ( ) — 3244KB
• mgam-20240630.xsd (EX-101.SCH) — 32KB
• mgam-20240630_cal.xml (EX-101.CAL) — 32KB
• mgam-20240630_def.xml (EX-101.DEF) — 143KB
• mgam-20240630_lab.xml (EX-101.LAB) — 290KB
• mgam-20240630_pre.xml (EX-101.PRE) — 150KB
• ea0212551-10q_mobile_htm.xml (XML) — 229KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION 1 Item 1. Condensed Financial Statements (unaudited) 1 Condensed Balance Sheets as of June 30, 2024 and December 31, 2023 1 Condensed Statements of Operations for the Three and Six months ended June 30, 2024 and 2023 2 Condensed Statements of Stockholders' Equity for the Three and Six months ended June 30, 2024 and 2023 3 Condensed Statements of Cash Flows for the Six Months Ended June 30, 2024 and 2023 4 Item 2.

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

Management's Discussion and Analysis of Financial Condition and Results of Operations 13 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 18 Item 4.

Controls and Procedures

Controls and Procedures 18

Other Information

Part II. Other Information 19 Item 1.

Legal Proceedings

Legal Proceedings 19 Item 1A.

Risk Factors

Risk Factors 19 Item 6. Exhibits 20

Signatures

Signatures 21 i Cautionary Note Regarding Forward-Looking Statements This Quarterly Report on Form 10-Q contains forward-looking The forward-looking statements are contained principally in the sections entitled "Risk Factors," and "Management's Discussion and Analysis of Financial Condition and Results of Operations," but are also contained elsewhere in this Quarterly Report. In some cases, you can identify forward-looking statements by terms such as "may," "might," "will," "should," "expects," "plans," "anticipates," "could," "would," "intends," "targets," "projects," "contemplates," "believes," "estimates," "predicts," "potential" or "continue" or the negative of these terms or other similar expressions. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the

forward-looking statements. Forward-looking statements include, but are not limited to, statements about

forward-looking statements. Forward-looking statements include, but are not limited to, statements about: Failure of future market acceptance of our mobile esports products and services; Increased levels of competition; Changes in political, economic or regulatory conditions generally and in the markets in which we operate; Our ability to retain and attract senior management and other key employees; Our ability to protect our trade secrets or other proprietary rights, operate without infringing upon the proprietary rights of others and prevent others from infringing on the proprietary rights of the Company; and Other risks, including those described in the "Risk Factors" discussion. You should carefully review and consider the information regarding certain factors which could materially affect our business, financial condition or future results set forth under the heading "Risk Factors" in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. There have been no material changes from the risk factors previously disclosed therein, except as set in the "Risk Factors" section of this Quarterly Report on Form 10-Q for a discussion of important factors that may cause our actual results to differ materially from those expressed or implied by our forward-looking statements. The forward-looking in our forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. Because forward- looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on these forward-looking statements as predictions of future events. The events and

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Condensed Financial Statements

Item 1. Condensed Financial Statements MOBILE GLOBAL ESPORTS INC. Condensed Balance Sheets June 30, December 31, 2024 2023 Note (unaudited) (audited) Assets Current assets: Cash $ 2,033,488 $ 3,174,703 Prepaid expenses 55,582 93,127 Total current assets 2,089,070 3,267,830 Property and equipment, net 3 64,465 29,632 Operating lease right of use asset 4 99,966 103,812 Other long-term assets 24,350 20,070 Total assets $ 2,277,851 $ 3,421,344 Liabilities Current liabilities: Accounts payable and accrued expenses 5 $ 89,721 $ 152,423 Operating lease liabilities, current 4 67,556 54,509 Note payable 7 - 65,040 Total current liabilities 157,277 271,972 Operating lease liabilities, long term 4 35,290 52,166 Total liabilities 192,567 324,138 Commitments and contingencies 9 Stockholders' equity 8 Preferred stock; $ 0.0001 par value; 10,000,000 shares authorized; nil shares issued and outstanding - - Common stock, $ 0.0001 par value, 100,000,000 shares authorized, 21,236,503 and 21,191,593 shares issued and outstanding 2,123 2,119 Additional paid-in capital 11,527,875 11,427,419 Accumulated deficit ( 9,434,656 ) ( 8,322,769 ) Accumulated other comprehensive loss 38 ( 3,032 ) Total stockholders' equity - Mobile Global Esports Inc. 2,095,380 3,103,737 Non-controlling interest ( 10,096 ) ( 6,531 ) Total stockholders' equity 2,085,284 3,097,206 Total liabilities and stockholders' equity $ 2,277,851 $ 3,421,344 The accompanying footnotes are an integral part of these unaudited financial statements. 1 MOBILE GLOBAL ESPORTS INC. Condensed Statements of Operations (Unaudited) For the three and six months ended June 30, 2024 and 2023 Six Months Six Months Three Months Three Months Ended Ended Ended Ended Note June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023 Revenue $ - $ - $ - $ - Cost of revenue - - - -

NOTES TO FINANCIAL STATEMENTS

NOTES TO FINANCIAL STATEMENTS For the Six months Ended June 30, 2024 and 2023 (unaudited) Note 1 – Organization and Basis of Presentation Organization Mobile Global Esports Inc. ("MOGO Inc") was incorporated on March 11, 2021 under the laws of the State of Delaware. The Company was originally named Elite Esports, Inc. but changed its name to Mobile Global Esports Inc. on April 21, 2021. MOGO Inc has been assigned certain limited rights to commercialize university esports events for 92 universities in India. The unique advantage of esports is that the events can be virtual, and virtual events bypass any Covid-19 or other pandemic restrictions on in-person events. During July 2022, MOGO Esports Private Limited ("MOGO Pvt Ltd") was established and incorporated in India by certain shareholders of MOGO Inc. During November 2022, MOGO Inc acquired approximately 99 % of MOGO Pvt Ltd. MOGO Pvt Ltd comprised approximately 12.1 % and 5.4 % of the Company's total assets as of June 30, 2024 and December 31, 2023, and 26.6 % and 9.3 % of the Company's net loss for the six months ended June 30, 2024 and 2023, and 36.6 % and 8.5 % of the Company's net loss for the three months ended June 30, 2024 and 2023, respectively. Basis of Presentation The accompanying consolidated financial statements were prepared in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP"). The consolidated financial statements include the accounts of MOGO Inc and MOGO Pvt Ltd (collectively, the "Company"). MOGO Inc owns a 99 % controlling interest in MOGO Pvt Ltd. The value of the non-controlling interest in MOGO Pvt Ltd is immaterial. The functional currency of MOGO Pvt Ltd is the Indian Rupee ("INR"). The assets and liabilities of MOGO Pvt Ltd are translated to United States Dollars ("USD") at period end exchange rates, while statements of operations accounts are translated at the average exchange rate during the period. The effects of foreign c

NOTES TO FINANCIAL STATEMENTS

NOTES TO FINANCIAL STATEMENTS For the Six months Ended June 30, 2024 and 2023 (unaudited) Note 2 – Summary of Significant Accounting Policies Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company's estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. Significant estimates in the accompanying consolidated financial statements include the valuation allowance on deferred tax assets and the estimated value of warrants issued for services. Cash Equivalents For the purpose of the statement of cash flows, cash equivalents include time deposits, certificate of deposits, amounts held in escrow and all highly-liquid debt instruments with original maturities of three months or less. At June 30, 2024 and December 31, 2023, the Company did not have any cash equivalents. Property and Equipment Property and equipment, net, is stated at cost and consists of furniture and fixtures and office and computer equipment. Depreciation is computed over the estimated useful lives of the assets, generally three to ten years , using

NOTES TO FINANCIAL STATEMENTS

NOTES TO FINANCIAL STATEMENTS For the Six months Ended June 30, 2024 and 2023 (unaudited) Long-Lived Assets The Company reviews long-lived assets for realizability on an ongoing basis. Changes in depreciation and amortization, generally accelerated depreciation and variable amortization, are determined and recorded when estimates of the remaining useful lives or residual values of long-term assets change. The Company also reviews for impairment when conditions exist that indicate the carrying amount of the assets may not be fully recoverable. In those circumstances, the Company performs undiscounted operating cash flow analyses to determine if an impairment exists. When testing for asset impairment, the Company groups assets and liabilities at the lowest level for which cash flows are separately identifiable. Any impairment loss is calculated as the excess of the asset's carrying value over its estimated fair value. Fair value is estimated based on the discounted cash flows for the asset group over the remaining useful life or based on the expected cash proceeds for the asset less costs of disposal. Any impairment losses would be recorded in the consolidated statements of operations. Fair Value of Financial Instruments For certain of the Company's financial instruments, including cash and accounts payable, the carrying amounts approximate their fair values due to their short maturities. ASC Topic 820, Fair Value Measurements and Disclosures , requires disclosure of the fair value of financial instruments held by the Company. ASC Topic 825, Financial Instruments , defines fair value, and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The carrying amounts reported in the balance sheets for receivables and current liabilities each qualify as financial instruments and are a reasonable estimate of their fair values because of the short period of time between

NOTES TO FINANCIAL STATEMENTS

NOTES TO FINANCIAL STATEMENTS For the Six months Ended June 30, 2024 and 2023 (unaudited) Income Taxes The Company accounts for income taxes in accordance with ASC Topic 740, Income Taxes . ASC 740 requires a company to use the asset and liability method of accounting for income taxes, whereby deferred tax assets are recognized for deductible temporary differences, and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion, or all of, the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. Under ASC 740, a tax position is recognized as a benefit only if it is "more likely than not" that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the "more likely than not" test, no tax benefit is recorded. The Company has no material uncertain tax positions for any of the reporting periods presented. Basic and Diluted Earnings Per Share Earnings per share is calculated in accordance with ASC Topic 260, Earnings Per Share . Basic earnings per share ("EPS") is based on the weighted average number of common shares outstanding. Diluted EPS assumes that all dilutive securities are converted. Dilution is computed by applying the treasury stock method. Under this method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price d

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