SurgePays, Inc. Files 10-Q for Period Ending March 31, 2024

TL;DR

<b>SurgePays, Inc. has filed its Q1 2024 10-Q report, detailing financial data and company history.</b>

AI Summary

SurgePays, Inc. (SURG) filed a Quarterly Report (10-Q) with the SEC on May 13, 2024. SurgePays, Inc. filed a 10-Q report for the period ending March 31, 2024. The filing covers the first quarter of fiscal year 2024. The company was formerly known as Surge Holdings, Inc., KSIX Media Holdings, Inc., and North American Energy Resources, Inc. The company's principal business address is 3124 Brother Blvd, Suite 104, Bartlett, TN 38133. The filing includes data related to common stock, additional paid-in capital, retained earnings, and noncontrolling interest for various periods.

Why It Matters

For investors and stakeholders tracking SurgePays, Inc., this filing contains several important signals. This 10-Q filing provides a quarterly update on SurgePays, Inc.'s financial performance and position, crucial for investors to assess recent operational results and trends. Understanding the company's historical name changes and its current business address offers context for its evolution and operational base.

Risk Assessment

Risk Level: low — SurgePays, Inc. shows low risk based on this filing. The filing is a standard 10-Q, providing routine financial disclosures without immediate indicators of significant new risks or opportunities.

Analyst Insight

Review the detailed financial statements within the 10-Q to understand SurgePays, Inc.'s performance in Q1 2024 and compare it to previous periods.

Key Numbers

• 2024-03-31 — Reporting Period End Date (Conformed period of report)
• 2024-05-13 — Filing Date (Filed as of date)
• 2024-01-01 — Quarter Start Date (First quarter of fiscal year 2024)
• 2023-03-31 — Prior Year Quarter End Date (Comparison period)

Key Players & Entities

• SurgePays, Inc. (company) — Filer name
• Surge Holdings, Inc. (company) — Former company name
• KSIX Media Holdings, Inc. (company) — Former company name
• North American Energy Resources, Inc. (company) — Former company name
• NV (company) — State of incorporation
• Bartlett (company) — City of business address
• TN (company) — State of business address
• 38133 (company) — ZIP code of business address

FAQ

Industry Context

SurgePays, Inc. operates within the telecommunications sector, specifically classified under 'TELEPHONE COMMUNICATIONS (NO RADIO TELEPHONE)' by SIC code 4813.

Regulatory Implications

The filing is a Form 10-Q, a standard quarterly report required by the U.S. Securities and Exchange Commission (SEC) for public companies.

What Investors Should Do

1. Analyze the financial statements for Q1 2024 to identify revenue, expenses, and profitability trends.
2. Review any disclosures regarding business operations, legal proceedings, or risk factors mentioned in the full filing.
3. Compare the Q1 2024 results with historical data from previous 10-Q filings to assess year-over-year and sequential performance.

Key Dates

• 2024-03-31: Quarterly Period End — End of the reporting period for the 10-Q filing.
• 2024-05-13: Filing Date — Date the 10-Q was officially filed with the SEC.

Year-Over-Year Comparison

This is the first 10-Q filing for the period ending March 31, 2024, and it follows the 10-K filed for the fiscal year ending December 31, 2023.

Filing Documents

• form10-q.htm (10-Q) — 2052KB
• ex31-1.htm (EX-31.1) — 22KB
• ex31-2.htm (EX-31.2) — 23KB
• ex32-1.htm (EX-32.1) — 12KB
• ex32-2.htm (EX-32.2) — 12KB
• 0001493152-24-018890.txt (&nbsp;) — 11598KB
• surg-20240331.xsd (EX-101.SCH) — 73KB
• surg-20240331_cal.xml (EX-101.CAL) — 70KB
• surg-20240331_def.xml (EX-101.DEF) — 329KB
• surg-20240331_lab.xml (EX-101.LAB) — 593KB
• surg-20240331_pre.xml (EX-101.PRE) — 449KB
• form10-q_htm.xml (XML) — 2608KB

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 7 - 59 1 SurgePays, Inc. and Subsidiaries Consolidated Balance Sheets March 31, 2024 December 31, 2023 (Unaudited) Assets Current Assets Cash $ 42,945,078 $ 14,622,060 Accounts receivable - net 8,271,878 9,536,074 Inventory 7,343,739 9,046,594 Prepaids and other 499,908 161,933 Total Current Assets 59,060,603 33,366,661 Property and equipment - net 291,458 361,841 Other Assets Note receivable 176,851 176,851 Intangibles - net 1,963,093 2,126,470 Internal use software development costs - net 483,717 539,424 Goodwill 4,166,782 1,666,782 Investment in CenterCom 480,562 464,409 Operating lease - right of use asset - net 420,107 387,869 Deferred income taxes - net 2,542,000 2,835,000 Total Other Assets 10,233,112 8,196,805 Total Assets $ 69,585,173 $ 41,925,307 Liabilities and Stockholders' Equity Current Liabilities Accounts payable and accrued expenses $ 6,506,061 $ 6,439,120 Accounts payable and accrued expenses - related party 564,389 1,048,224 Accounts payable and accrued expenses 564,389 1,048,224 Accrued income taxes payable 700,000 570,000 Deferred revenue - 20,000 Operating lease liability 94,244 43,137 Note payable - related party 1,567,254 4,584,563 Total Current Liabilities 9,431,948 12,705,044 Long Term Liabilities Note payable - related party 3,147,879 - Notes payable - SBA government 477,403 460,523 Notes payable 477,403 460,523 Operating lease liability 342,444 356,276 Total Long-Term Liabilities 3,967,726 816,799 Total Liabilities 13,399,674 13,521,843 Stockholders' Equity Common stock, $ 0.001 par value, 500,000,000 shares authorized 19,431,549 and 14,403,261 shares issued and outstanding, respectively 19,435 14,404 Additional paid-in capital 69,985,592 43,421,019 Accumulated deficit ( 13,961,608 ) ( 15,186,203 ) Stockholders' equity 56,043,419 28,249,22

Business

Business Combinations and Asset Acquisitions The Company accounts for acquisitions that qualify as business combinations by applying the acquisition method according to Accounting Standards Codification ("ASC") 805, Business Combinations ("ASC 805"). Transaction costs related to the acquisition of a business are expensed as incurred and excluded from the fair value of consideration transferred. The identifiable assets acquired, liabilities assumed, and noncontrolling interests in an acquired entity are recognized and measured at their estimated fair values. The excess of the fair value of consideration transferred over the fair values of identifiable assets acquired, liabilities assumed, and noncontrolling interests in an acquired entity, net of the fair value of any previously held interest in the acquired entity, is recorded as goodwill. Such valuations require management to make significant estimates and assumptions. Purchase price allocations may be preliminary, and, during the measurement period not to exceed one year from the date of acquisition, changes in assumptions and estimates that result in adjustments to the fair value of assets acquired and liabilities assumed are recorded in the period the adjustments are determined. Significant judgments are used in determining fair values of assets acquired and liabilities assumed, as well as intangibles. Fair value and useful life determinations are based on, among other factors, estimates of future expected cash flows, and appropriate discount rates used in computing present values. These judgments may materially impact the estimates used in allocating acquisition date fair values to assets acquired and liabilities assumed, as well as the Company's current and future operating results. Actual results may vary from these estimates which may result in adjustments to goodwill and acquisition date fair values of assets and liabilities during a measurement period or upon a final determination of asset and li

Business

Business Segments and Concentrations The Company uses the "management approach" to identify its reportable segments. The management approach requires companies to report segment financial information consistent with information used by management for making operating decisions and assessing performance as the basis for identifying the Company's reportable segments. The Company manages its business as multiple reportable segments. See Note 10 regarding segment disclosure. The Mobile Virtual Network Operator (SurgePhone and Torch Wireless) business segment made up approximately 92 % and 82 % of total consolidated revenues for the three months ended March 31, 2024 and 2023, respectively. Revenues related to this business segment are 100 % derived from programs administered by the Federal Communications Commission (FCC), and all funds related to these programs are received directly from organizations under the direction of the FCC and subject to administrative rulings, statutory changes, and other funding restrictions that could impact the Company's operations in this segment. Accounts receivable related to these programs made up 99 % and 98 % of accounts receivable at March 31, 2024 and December 31, 2023, respectively. Customers in the United States accounted for 100 % of our revenues. We do not have any property or equipment outside of the United States. Use of Estimates Preparing 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 the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reported period. Actual results could differ from those estimates, and those estimates may be material. Significant estimates during the three months ended March 31, 2024 and 2023, respectively, include, allowance for doubtful accounts and other receivables, inventory reserves and clas

View Full Filing

View this 10-Q filing on SEC EDGAR