SurgePays Reports 2024 Financial Results and Issues Revenue Guidance of Over $200 Million in Next 12 Months
Rhea-AI Summary
SurgePays (Nasdaq: SURG) announced its 2024 financial results and provided guidance for the next 12 months. The company projects revenue exceeding $200 million and expects to achieve positive cash flow from operations by the end of 2025, following its successful AT&T integration.
Key operational highlights include:
- National rollout of LinkUp Mobile with expected monthly SIM card shipments of 250,000-300,000
- Completed AT&T integration for 4G LTE and 5G wireless services
- Launch of MVNE wholesale business offering wireless infrastructure services
- POS platform growth with over 400% increase in prepaid wireless top-up revenue from Q1 to Q2 2024
While 2024 revenue and gross profit were impacted by the end of federal ACP funding, the company retained a portion of its wireless subscriber base and is transitioning eligible customers to the Lifeline program. First quarter 2025 revenue is expected to remain consistent with Q4 2024.
Positive
- Projected revenue exceeding $200 million in next 12 months
- Expected positive cash flow from operations by end of 2025
- Monthly SIM card shipments projected at 250,000-300,000
- 400% growth in POS platform prepaid wireless top-up revenue Q1 to Q2 2024
- Launch of high-margin MVNE wholesale business
- Successful AT&T integration completed for nationwide coverage
Negative
- Revenue and gross profit declined in 2024 due to end of federal ACP funding
- Q1 2025 revenue expected to remain flat compared to Q4 2024
Insights
SurgePays' strategic pivot following the ACP funding expiration demonstrates a multi-faceted growth strategy that leverages both retail and wholesale wireless opportunities. The AT&T integration represents a significant infrastructure enhancement, providing access to premium network services that will likely improve customer experience and reduce churn for their LinkUp Mobile brand.
The projected
Their MVNE wholesale business launch is particularly noteworthy as it transforms SurgePays from purely retail-focused to a platform company - providing infrastructure services to other wireless brands creates a diversified revenue stream with typically higher margins than direct-to-consumer operations.
The
While the guidance suggests operational confidence, investors should monitor quarterly SIM card shipment volumes as the primary indicator of execution success. The transition from government-subsidized customers to commercial acquisitions represents both their greatest challenge and opportunity in 2025.
SurgePays' financial narrative centers around a transition from reliance on the government-funded ACP program to establishing sustainable commercial growth engines. The
The company's statement that Q1 2025 revenue will remain consistent with Q4 2024 suggests a stabilization period before acceleration. This phased approach to their guidance - stability followed by growth - appears realistic given the timing of their AT&T integration completion (April 1, 2025).
Particularly encouraging is the positive cash flow from operations projection before year-end 2025. For a company undergoing significant business model transition, achieving operational cash flow positivity would mark a critical financial milestone and reduce capital market dependence.
The multi-channel strategy spanning retail wireless (LinkUp Mobile), government program participants (remaining Lifeline customers), and B2B services (MVNE platform) creates revenue diversification that should improve financial stability. Each channel has different margin profiles, with MVNE typically offering the highest contribution margins.
Investors should note that the aggressive subscriber growth targets will likely require substantial working capital to finance inventory, SIM cards, and customer acquisition costs. The path to positive cash flow may involve near-term cash consumption to fuel the projected growth, making execution against the subscriber targets particularly important to monitor in quarterly results.
Completed AT&T integration positions company for its most aggressive growth phase to date with projected positive cash flow from operations in 2025
Brian Cox, Chairman and CEO, commented, "We built the infrastructure. Now we are scaling. With AT&T integration complete and LinkUp Mobile launching nationally, SurgePays is positioned for the most aggressive revenue growth phase in our history."
2024 Operational Highlights:
- Nationwide Launch of LinkUp Mobile: SurgePays has begun its national rollout of its retail prepaid wireless brand, LinkUp Mobile. The Company expects monthly SIM card shipments of 250,000–300,000, driven by robust demand from its retail distribution network of nearly 9,000 convenience and community stores.
- AT&T Integration Complete: In November 2024, SurgePays signed a multi-year strategic agreement with AT&T to deliver full access to 4G LTE and 5G wireless services across
North America . As of April 1, 2025, the integration is complete and live. - MVNE Wholesale Business Launch: SurgePays now offers wireless infrastructure services, including SIM provisioning and billing, to other wireless companies as a Mobile Virtual Network Enabler (MVNE). This high-margin revenue channel is expected to scale rapidly.
- Lifeline Subscriber Retention: Following the end of ACP funding, SurgePays retained a portion of its wireless subscriber base and is transitioning eligible customers to the federally supported Lifeline program. Daily Lifeline enrollments are ongoing through the Company's Torch Wireless brand.
- POS Platform Growth: SurgePays' point-of-sale software platform, used in thousands of retail locations, grew prepaid wireless top-up revenue over
400% from Q1 to Q2 2024. The POS platform is a critical distribution and activation tool for both LinkUp Mobile and third-party services. - Leadership Expansion: The Company strengthened its leadership team with the promotion of Mark Garner to Executive Vice President, and Allison Seyler to VP of Sales.
2024 Financial Results:
2024 marked the end of the federally funded ACP era. As expected, revenue and gross profit were impacted. However, strategic investments made during this transition — including AT&T integration, POS growth, and the development of our MVNE platform — have built the foundation for 2025's goal to return to growth and profitability.
2025 Financial Guidance:
SurgePays expects first quarter 2025 revenue to remain consistent with Q4 2024. With the national launch of LinkUp Mobile and expanding MVNE partnerships, revenue is projected to exceed
This guidance is based solely on the monetization of core MVNO and POS platforms already deployed. As these platforms scale — both through direct customer acquisition and wholesale MVNE relationships — we anticipate expanding both revenue and margins.
"We've earned the right to scale," added Mr. Cox. "The heavy lifting is behind us. Now we are focused on execution, revenue acceleration, and delivering long-term value to shareholders."
Fourth Quarter 2024 Results Conference Call:
SurgePays management will host a webcast today at 5 p.m. ET / 2 p.m. PT to discuss these results.
The live webcast of the call can be accessed on the Company's investor relations website at ir.surgepays.com, or by registering at the following link: Fourth Quarter Results Call.
Telephone access:
-
- International: 973-528-0011
- Participant Access Code: 937037
A telephone replay will be available approximately one hour following completion of the call until April 8, 2025.
Replay: 877-481-4010 (
Replay Passcode: 52151
About SurgePays, Inc.
SurgePays, Inc. is a wireless and point-of-sale (POS) technology company. SurgePays operates a unique ecosystem that blends prepaid wireless, government-subsidized mobile plans, and a point-of-sale software platform used in thousands of community retail stores. SurgePays is a platform — built for stores in underserved communities, built to scale, and built for growth. Please visit www.SurgePays.com for more information.
Cautionary Note Regarding Forward-Looking Statements
This press release includes express or implied statements that are not historical facts and are considered forward-looking within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act. Forward-looking statements involve substantial risks and uncertainties and generally relate to future events or our future financial or operating performance. These statements may include projections, guidance, or other estimates regarding revenue, cash flow, business growth, market expansion, or customer acquisition. In some cases, you can identify forward-looking statements by the following words: "may," "will," "could," "would," "should," "expect," "intend," "plan," "anticipate," "believe," "estimate," "predict," "project," "potential," "continue," "ongoing," "attempting," or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words.
Although we believe the expectations reflected in these forward-looking statements, such as regarding our revenue and profitability potential along with the statements under the heading 2025 Financial Guidance are reasonable, these statements relate to future events or our future operational or financial performance and involve known and unknown risks, uncertainties, and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. Furthermore, actual results may differ materially from those described in the forward-looking statements and will be affected by a variety of risks and factors that are beyond our control, including, without limitation, the assumption that revenue is projected to exceed
SurgePays, Inc. and Subsidiaries Consolidated Balance Sheets
| ||||||||
December 31, | December 31, | |||||||
Assets | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ | 11,790,389 | $ | 14,622,060 | ||||
Restricted cash - held in escrow | 1,000,000 | - | ||||||
Accounts receivable - net | 3,000,209 | 9,536,074 | ||||||
Inventory | 1,781,365 | 9,046,594 | ||||||
Prepaids and other | 298,360 | 161,933 | ||||||
Total Current Assets | 17,870,323 | 33,366,661 | ||||||
Property and equipment - net | 591,088 | 361,841 | ||||||
Other Assets | ||||||||
Note receivable | 176,851 | 176,851 | ||||||
Intangibles - net | 1,472,962 | 2,126,470 | ||||||
Internal use software development costs - net | - | 539,424 | ||||||
Goodwill | 3,300,000 | 1,666,782 | ||||||
Investment in CenterCom | - | 464,409 | ||||||
Operating lease - right of use asset - net | 564,781 | 387,869 | ||||||
Deferred income taxes - net | - | 2,835,000 | ||||||
Total Other Assets | 5,514,594 | 8,196,805 | ||||||
Total Assets | $ | 23,976,005 | $ | 41,925,307 | ||||
Liabilities and Stockholders' Equity | ||||||||
Current Liabilities | ||||||||
Accounts payable and accrued expenses | $ | 3,929,195 | $ | 6,439,120 | ||||
Accounts payable and accrued expenses - related party | 192,845 | 1,048,224 | ||||||
Accrued income taxes payable | - | 570,000 | ||||||
Deferred revenue | - | 20,000 | ||||||
Operating lease liability | 248,069 | 43,137 | ||||||
Note payable - related party | 1,689,367 | 4,584,563 | ||||||
Total Current Liabilities | 6,059,476 | 12,705,044 | ||||||
Long Term Liabilities | ||||||||
Note payable - related party | 1,866,288 | - | ||||||
Notes payable - SBA government | 469,396 | 460,523 | ||||||
Operating lease liability | 319,232 | 356,276 | ||||||
Total Long Term Liabilities | 2,654,916 | 816,799 | ||||||
Total Liabilities | 8,714,392 | 13,521,843 | ||||||
Stockholders' Equity | ||||||||
Common stock, | 20,435 | 14,404 | ||||||
Additional paid-in capital | 76,842,878 | 43,421,019 | ||||||
Treasury stock - at cost (362,620 and 0 shares, respectively) | (631,967) | - | ||||||
Accumulated deficit | (60,915,427) | (15,186,203) | ||||||
Stockholders' equity | 15,315,919 | 28,249,220 | ||||||
Non-controlling interest | (54,306) | 154,244 | ||||||
Total Stockholders' Equity | 15,261,613 | 28,403,464 | ||||||
Total Liabilities and Stockholders' Equity | $ | 23,976,005 | $ | 41,925,307 | ||||
SurgePays, Inc. and Subsidiaries Consolidated Statements of Operations | ||||||||
For the Years Ended December 31, | ||||||||
2024 | 2023 | |||||||
Revenues | $ | 60,881,173 | $ | 137,141,832 | ||||
Costs and expenses | ||||||||
Cost of revenues | 75,205,372 | 101,499,341 | ||||||
General and administrative expenses | 27,458,152 | 16,777,107 | ||||||
Total costs and expenses | 102,663,524 | 118,276,448 | ||||||
Income (loss) from operations | (41,782,351) | 18,865,384 | ||||||
Other income (expense) | ||||||||
Interest expense | (554,200) | (595,975) | ||||||
Loss on lease termination - net | (194,863) | - | ||||||
Other income | 636,868 | - | ||||||
Interest income | 105,395 | - | ||||||
Realized gains - investments | 13,613 | - | ||||||
Dividends, interest, and other income - investments | 355,549 | - | ||||||
Gain on investment in CenterCom | 33,864 | 110,203 | ||||||
Impairment loss - CenterCom | (498,273) | - | ||||||
Impairment loss - internal use software development costs | (316,594) | - | ||||||
Impairment loss - goodwill | (866,782) | - | ||||||
Total other income (expense) - net | (1,285,423) | (485,772) | ||||||
Net income (loss) before provision for income taxes | (43,067,774) | 18,379,612 | ||||||
Provision for income tax benefit (expense) | (2,870,000) | 2,265,000 | ||||||
Net income (loss) including non-controlling interest | (45,937,774) | 20,644,612 | ||||||
Non-controlling interest | (208,550) | 26,709 | ||||||
Net income (loss) available to common stockholders | $ | (45,729,224) | $ | 20,617,903 | ||||
Earnings per share - attributable to common stockholders | ||||||||
Basic | $ | (2.39) | $ | 1.45 | ||||
Diluted | $ | (2.39) | $ | 1.38 | ||||
Weighted average number of shares outstanding - attributable to common stockholders | ||||||||
Basic | 19,119,181 | 14,258,172 | ||||||
Diluted | 19,119,181 | 14,922,881 | ||||||
SurgePays, Inc. and Subsidiaries Consolidated Statements of Cash Flows
| ||||||||
For the Years Ended December 31, | ||||||||
2024 | 2023 | |||||||
Operating activities | ||||||||
Net income (loss) - including non-controlling interest | $ | (45,937,774) | $ | 20,644,612 | ||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operations | ||||||||
Bad debt expense | - | 90,009 | ||||||
Depreciation and amortization | 942,450 | 935,039 | ||||||
Amortization of right-of-use assets | 126,970 | 43,483 | ||||||
Amortization of internal use software development costs | 222,830 | 129,060 | ||||||
Impairment loss - CenterCom | 498,273 | - | ||||||
Impairment loss - internal use software development costs | 316,594 | - | ||||||
Impairment loss - goodwill | 866,782 | - | ||||||
Stock issued for services | 411,740 | 1,290,024 | ||||||
Recognition of stock based compensation - unvested shares - related parties | 6,752,706 | 529,534 | ||||||
Recognition of stock-based compensation | 1,602,997 | - | ||||||
Recognition of share based compensation - options | - | 576,625 | ||||||
Recognition of share based compensation - options - related party | 6,196 | 37,176 | ||||||
Realized gain in sale of investments | (13,613) | - | ||||||
Interest expense adjustment - SBA loans | 19,750 | - | ||||||
Right-of-use asset lease payment adjustment true up | (267,347) | - | ||||||
Gain on equity method investment - CenterCom | (33,864) | (110,203) | ||||||
Cash paid for lease termination | (212,175) | - | ||||||
Loss on lease termination - net | 194,863 | - | ||||||
Changes in operating assets and liabilities | ||||||||
(Increase) decrease in | ||||||||
Accounts receivable | 6,535,865 | (395,718) | ||||||
Inventory | 7,265,229 | 2,139,648 | ||||||
Prepaids and other | (136,427) | (50,409) | ||||||
Deferred income taxes - net | 2,835,000 | (2,835,000) | ||||||
Increase (decrease) in | ||||||||
Accounts payable and accrued expenses | (2,509,925) | 654,746 | ||||||
Accounts payable and accrued expenses - related party | (356,388) | (680,497) | ||||||
Accrued income taxes payable | (570,000) | 570,000 | ||||||
Installment sale liability - net | - | (13,018,184) | ||||||
Deferred revenue | (20,000) | (223,110) | ||||||
Operating lease liability | 148,665 | (39,490) | ||||||
Net cash provided by (used in) operating activities | (21,310,603) | 10,287,345 | ||||||
Investing activities | ||||||||
Purchase of property and equipment | (518,189) | - | ||||||
Purchase of investments - net | (10,159,444) | - | ||||||
Proceeds from sale of investments | 10,173,057 | - | ||||||
Cash paid for acquisition of Clearline Mobile, Inc. assets | (2,500,000) | - | ||||||
Capitalized internal use software development costs | - | (281,304) | ||||||
Net cash used in investing activities | (3,004,576) | (281,304) | ||||||
Financing activities | ||||||||
Proceeds from stock issued for cash | 17,249,994 | - | ||||||
Proceeds from exercise of common stock warrants | 8,799,257 | 207,240 | ||||||
Cash paid as direct offering costs | (1,395,000) | - | ||||||
Repayments of loans - related party | (1,527,899) | (1,017,385) | ||||||
Repayments on notes payable | - | (1,595,167) | ||||||
Repayments on notes payable - SBA government | (10,877) | (14,323) | ||||||
Treasury shares repurchased (share buy-backs) | (631,967) | - | ||||||
Net cash provided (used in) by financing activities | 22,483,508 | (2,419,635) | ||||||
Net increase (decrease) in cash, cash equivalents and restricted cash | (1,831,671) | 7,586,406 | ||||||
Cash, cash equivalents and restricted cash - beginning of year | 14,622,060 | 7,035,654 | ||||||
Cash, cash equivalents and restricted cash - end of year | $ | 12,790,389 | $ | 14,622,060 | ||||
Supplemental disclosure of cash flow information | ||||||||
Cash paid for interest | $ | 470,208 | $ | 222,326 | ||||
Cash paid for income tax | $ | - | $ | - | ||||
Supplemental disclosure of non-cash investing and financing activities | ||||||||
Reclassification of accrued interest - related party to note payable - related party | $ | 498,991 | $ | - | ||||
Exercise of warrants - cashless | $ | 41 | $ | - | ||||
Termination of ROU operating lease assets and liabilities | $ | 327,139 | ||||||
Right-of-use asset obtained in exchange for new operating lease liability | $ | 664,288 | $ | - | ||||
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SOURCE SurgePays
FAQ
What is SurgePays' revenue guidance for the next 12 months after their 2024 results?
When does SURG expect to achieve positive cash flow from operations?
How many monthly SIM card shipments does SURG expect for LinkUp Mobile?
What was the growth rate of SURG's POS platform prepaid wireless top-up revenue from Q1 to Q2 2024?
What strategic partnership did SURG complete in November 2024?
