MediXall Posts Q3 Profit Amidst Revenue Dip, Going Concern Doubts Linger

TL;DR

**MediXall's Q3 profit is a mirage from debt settlement; this company is still a speculative bet with serious going concern risks.**

AI Summary

MediXall Group, Inc. reported a net income of $263,813 for the three months ended September 30, 2024, a significant improvement from a net loss of $908,067 in the same period of 2023. However, for the nine months ended September 30, 2024, the company still posted a net loss of $708,649, albeit a substantial reduction from the $3,108,940 net loss in the prior year. Revenue decreased to $38,858 for the three-month period in 2024 from $65,535 in 2023, and for the nine-month period, revenue slightly declined to $209,839 from $214,925. A key business change was the gain on settlement of accounts payable and accrued expenses of $610,290, which significantly contributed to the quarterly net income. The company's accumulated deficit stood at $38,992,083 as of September 30, 2024, and it continues to face substantial doubt about its ability to continue as a going concern due to insufficient operating cash flows and reliance on external financing. Strategic outlook remains focused on its Health Karma Inc. subsidiary, delivering value-based healthcare solutions via a monthly subscription model.

Why It Matters

This filing reveals MediXall Group's precarious financial health, marked by a substantial accumulated deficit of $38,992,083 and a 'going concern' warning, which is critical for investors. While the company achieved a rare quarterly net income of $263,813, this was largely driven by a one-time gain on debt settlement, not sustained operational profitability. For employees and customers of Health Karma, the sole active subsidiary, the company's reliance on external funding for future operations introduces uncertainty about long-term stability and service continuity. In a competitive healthcare solutions market, MediXall's struggle to generate consistent revenue and positive operating cash flow puts it at a significant disadvantage against more established players, impacting its ability to scale and innovate.

Risk Assessment

Risk Level: high — The company explicitly states 'substantial doubt' about its ability to continue as a going concern due to an accumulated deficit of $38,992,083 and insufficient operating cash flows. Its ability to continue is 'wholly dependent upon its ability to obtain additional financing,' with no assurance of securing such funds.

Analyst Insight

Investors should exercise extreme caution and consider this a highly speculative investment. Given the 'going concern' warning and reliance on external financing, new investors should avoid MediXall Group, Inc. until there is clear evidence of sustained operational profitability and a robust financial position.

Financial Highlights

debt To Equity

N/A

revenue

$38,858

operating Margin

N/A

total Assets

$219,980

total Debt

$3,838,658

net Income

$263,813

eps

N/A

gross Margin

57.4%

cash Position

$31,916

revenue Growth

-40.7%

Key Numbers

• $263,813 — Net income for Q3 2024 (Significant improvement from a $908,067 net loss in Q3 2023, largely due to debt settlement.)
• $708,649 — Net loss for nine months ended Sept 30, 2024 (Reduced from a $3,108,940 net loss in the prior year, but still negative.)
• $38,858 — Revenue for Q3 2024 (Decreased from $65,535 in Q3 2023, indicating declining sales.)
• $209,839 — Revenue for nine months ended Sept 30, 2024 (Slightly decreased from $214,925 in the prior year, showing stagnant top-line growth.)
• $610,290 — Gain on settlement of accounts payable and accrued expenses (Key factor in achieving Q3 2024 net income.)
• $38,992,083 — Accumulated deficit as of Sept 30, 2024 (Highlights significant historical losses and contributes to going concern doubts.)
• $31,916 — Cash as of Sept 30, 2024 (Extremely low cash balance, indicating liquidity challenges.)
• 205,506,008 — Shares of common stock issued and outstanding (As of September 2, 2025, indicating potential dilution.)
• $1,000,828 — Net cash used in operating activities for nine months ended Sept 30, 2024 (Continued negative operating cash flow, demonstrating inability to fund operations internally.)
• $1,022,023 — Net cash provided by financing activities for nine months ended Sept 30, 2024 (Reliance on external financing to cover operating cash burn.)

Key Players & Entities

• MediXall Group, Inc. (company) — registrant
• Health Karma Inc (company) — active operating subsidiary
• Nevada (regulator) — state of incorporation
• Securities and Exchange Commission (regulator) — filing oversight
• FASB (regulator) — accounting standards setter
• IP Gate, Inc. (company) — original company name
• Medixaid, Inc. (company) — dormant subsidiary
• MediXall.com, Inc. (company) — dormant subsidiary
• IHL of Florida, Inc. (company) — dormant subsidiary
• Medixall Financial Group (company) — dormant subsidiary

FAQ

Risk Factors

• Going Concern Uncertainty [high — financial]: The company faces substantial doubt about its ability to continue as a going concern due to insufficient operating cash flows and a significant accumulated deficit of $38,992,083 as of September 30, 2024. Net cash used in operating activities for the nine months ended September 30, 2024, was $1,000,828, highlighting a continued inability to fund operations internally.
• Reliance on External Financing [high — financial]: MediXall Group's operations are heavily reliant on external financing, as evidenced by $1,022,023 in net cash provided by financing activities for the nine months ended September 30, 2024. This dependence creates vulnerability to market conditions and investor sentiment.
• Low Cash Position [high — financial]: The company's cash balance of $31,916 as of September 30, 2024, is critically low, indicating severe liquidity challenges and a limited ability to meet short-term obligations without additional funding.
• Declining Revenue [medium — operational]: Revenue for the three months ended September 30, 2024, decreased to $38,858 from $65,535 in the prior year. For the nine-month period, revenue slightly declined to $209,839 from $214,925, indicating stagnant or declining top-line performance.
• Significant Accumulated Deficit [medium — financial]: The accumulated deficit stands at $38,992,083 as of September 30, 2024. This substantial historical loss impacts the company's financial health and investor confidence.
• Debt Obligations [medium — financial]: The company has various debt obligations, including Senior Convertible Debentures which, net of discount, were $177,500 as of September 30, 2024, down from $3,830,277 at the end of 2023. Notes payable also total $412,723. These obligations add financial pressure.
• Dependence on Health Karma Inc. [medium — market]: The company's strategic outlook is focused on its Health Karma Inc. subsidiary. Any challenges or underperformance within this subsidiary could significantly impact MediXall Group's overall prospects.
• Potential Share Dilution [low — financial]: With 205,506,008 shares of common stock issued and outstanding as of September 2, 2025, there is a significant number of shares, which could lead to substantial dilution for existing shareholders, especially if further equity financing is required.

Industry Context

MediXall Group operates in the healthcare solutions sector, with a focus on value-based healthcare via a subscription model through its Health Karma Inc. subsidiary. The broader healthcare technology industry is characterized by rapid innovation, increasing demand for digital health solutions, and evolving regulatory landscapes. Companies in this space often face challenges related to data security, patient privacy, and integration with existing healthcare systems.

Regulatory Implications

As a healthcare technology provider, MediXall Group is subject to stringent regulations concerning data privacy (e.g., HIPAA in the U.S.) and the security of patient information. Non-compliance can lead to significant fines and reputational damage. Changes in healthcare policy or reimbursement models could also impact the demand for its services.

What Investors Should Do

1. Monitor the performance and cash generation of the Health Karma Inc. subsidiary closely, as it is the primary strategic focus.
2. Assess the company's ability to secure ongoing external financing to cover operating losses and avoid a going concern event.
3. Evaluate the sustainability of the current business model given the declining revenue trend and reliance on debt settlements for profitability.
4. Consider the potential for future share dilution given the large number of outstanding shares and ongoing need for capital.

Key Dates

• 2024-09-30: End of Q3 2024 — Reported net income of $263,813, a significant turnaround from the prior year's loss, largely due to a gain on debt settlement. However, revenue declined to $38,858, and the company maintains substantial doubt about its going concern status.
• 2024-09-30: Nine Months Ended Q3 2024 — Reported a net loss of $708,649, a reduction from the prior year's loss. Revenue was $209,839, slightly down from the prior year. Operating cash flow remained negative at $1,000,828.
• 2023-09-30: Nine Months Ended Q3 2023 — Reported a net loss of $3,108,940 and revenue of $214,925. Net cash used in operations was significant, highlighting ongoing financial challenges.

Glossary

Accumulated deficit

The total net losses of a company that have not been offset by net income since its inception. It represents cumulative losses over time. (Indicates significant historical unprofitability for MediXall Group, Inc., contributing to going concern doubts.)

Going concern

An accounting assumption that a business will continue to operate for the foreseeable future, typically at least 12 months. If there is substantial doubt, it must be disclosed. (MediXall Group, Inc. faces substantial doubt about its ability to continue as a going concern, a critical warning for investors.)

Gain on settlement of accounts payable and accrued expenses

A non-operating income item recognized when a company settles its debts for less than the amount owed, effectively reducing its liabilities and increasing its net income. (This gain of $610,290 was the primary driver of MediXall Group's net income in Q3 2024, masking underlying operational performance.)

Net cash used in operating activities

The amount of cash a company has spent on its core business operations during a period. A negative number indicates cash is being consumed by operations. (MediXall Group's negative operating cash flow of $1,000,828 for nine months highlights its inability to generate cash from its primary business.)

Net cash provided by financing activities

The amount of cash a company has received from its financing activities, such as issuing debt or equity, during a period. A positive number indicates reliance on external funding. (MediXall Group's reliance on financing ($1,022,023 for nine months) to cover operational shortfalls is a key indicator of its financial precariousness.)

Senior Convertible Debentures

A type of debt security that can be converted into a predetermined amount of the issuer's equity at certain times. They are typically senior in the capital structure. (The significant reduction in this debt from $3,830,277 to $177,500 suggests a debt settlement or conversion, impacting the company's liabilities.)

Year-Over-Year Comparison

Compared to the prior year, MediXall Group has shown a dramatic improvement in net income for the third quarter, turning a $908,067 loss into a $263,813 profit, primarily due to a $610,290 gain on debt settlement. However, revenue has declined in both the quarterly and year-to-date periods. The company continues to operate at a net loss for the nine-month period and faces significant going concern risks due to negative operating cash flows, despite a reduction in overall liabilities and a substantial decrease in senior convertible debentures.

Key Financial Figures

• $0.001 — Voting Preferred Stock Common Stock $0.001 Par Value $0.001 Par Value $0.001

Filing Documents

• mdxl_10q.htm (10-Q) — 604KB
• ex31x1.htm (EX-31.1) — 9KB
• ex31x2.htm (EX-31.2) — 9KB
• ex32x1.htm (EX-32.1) — 4KB
• ex32x2.htm (EX-32.2) — 4KB
• 0001079973-25-001435.txt ( ) — 3176KB
• mdxl-20240930.xsd (EX-101.SCH) — 26KB
• mdxl-20240930_cal.xml (EX-101.CAL) — 36KB
• mdxl-20240930_def.xml (EX-101.DEF) — 80KB
• mdxl-20240930_lab.xml (EX-101.LAB) — 231KB
• mdxl-20240930_pre.xml (EX-101.PRE) — 188KB
• mdxl_10q_htm.xml (XML) — 380KB

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS: Condensed Consolidated Balance Sheets at September 30, 2024 (unaudited) and December 31, 2023 1 Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2024 and 2023 (unaudited) 2 Condensed Consolidated Statements of Changes in Stockholders' Deficit for the three and nine months ended September 30, 2024 and 2023 (unaudited) 3 Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2024 and 2023 (unaudited) 4 Notes to Condensed Consolidated Financial Statements (unaudited) 5 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 12 ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 16 ITEM 4.

CONTROLS AND PROCEDURES

CONTROLS AND PROCEDURES 16 PART II OTHER INFORMATION ITEM 1.

LEGAL PROCEEDINGS

LEGAL PROCEEDINGS 17 ITEM 1A.

RISK FACTORS

RISK FACTORS 17 ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 17 ITEM 3. DEFAULTS UPON SENIOR SECURITIES 17 ITEM 4. MINE SAFETY DISCLOSURES 17 ITEM 5. OTHER INFORMATION 17 ITEM 6. EXHIBITS 18

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS MEDIXALL GROUP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS September 30, December 31, 2024 2023 (Unaudited) ASSETS CURRENT ASSETS: Cash $ 31,916 $ 10,721 Accounts Receivable 11,540 — Other Assets 3,484 3,484 Total current assets 46,940 14,205 Furniture and equipment, net 10,734 13,488 Intellectual property 110,500 130,000 Right-of-use-operating lease asset 17,702 — Website and development costs 34,104 43,410 Total assets 219,980 201,103 LIABILITIES AND STOCKHOLDERS' DEFICIT CURRENT LIABILITIES: Accounts payable and accrued expenses $ 2,062,550 $ 2,531,615 Accounts payable and accrued expenses - related party 60,960 70,960 Accrued dividends 1,107,223 — Operating lease liability 11,723 — Notes payable 373,068 265,344 Senior Convertible Debentures, net of discount of $ 0 and $ 126,681 177,500 3,830,277 Total current liabilities 3,793,024 6,698,196 Operating lease liability, net of current portion 5,979 — Notes payable, net of current portion 39,655 26,463 Total liabilities 3,838,658 6,724,659 STOCKHOLDERS' DEFICIT: Convertible Preferred Series A stock, $ 0.001 par value, 1,000,000 authorized; 88,298 and 176,596 issued and outstanding $ 88 $ 177 Convertible Preferred Series B stock, $ 0.001 par value, 4,000,000 authorized 0 and 3,909,360 issued and outstanding — 3,909 Common Stock, $ 0.001 par value 750,000,000 shares authorized; 168,865,165 and 130,487,491 shares issued and outstanding 168,865 130,487 Additional paid-in capital 35,204,452 30,518,082 Accumulated deficit ( 38,992,083 ) ( 37,176,211 ) Total stockholders' deficit ( 3,618,678 ) ( 6,523,556 ) Total liabilities and stockholders' deficit 219,980 201,103 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 1 MEDIXALL GROUP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF

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