Revenue jumps at KwikClick (OTCQB: KWIK) as going concern risk persists
KwikClick, Inc. reported sharply higher revenue but remains in fragile financial condition. For the quarter ended March 31, 2026, net revenue rose to $675,161 from $206,870 a year earlier, led by custom design services and higher brand services.
The company narrowed its net loss to $27,245 from $92,768 and generated positive operating cash flow of $75,232, ending the quarter with cash of $152,375 and total assets of $904,547. Despite this, stockholders’ deficit was $3,148,009, and management disclosed a working capital deficit of $3,725,388.
KwikClick carries related-party notes payable to its CEO totaling $3,361,065 at a 10% interest rate and states there is substantial doubt about its ability to continue as a going concern without additional capital and revenue growth. The company also faces an adversary proceeding challenging ownership of its intellectual property, which could require impairing approximately $503,000 of intangible assets and potentially discontinuing its fee-based platform if it does not prevail. Management concluded that disclosure controls and internal control over financial reporting were not effective due to limited personnel and inadequate governance.
Positive
- None.
Negative
- Going concern risk and heavy related-party debt: Management discloses substantial doubt about continuing as a going concern, with a working capital deficit of $3,725,388 and $3,361,065 of 10% related-party notes payable to the CEO, alongside a stockholders’ deficit of $3,148,009.
Insights
Revenue is improving, but leverage, deficits, and going concern risk dominate.
KwikClick delivered much stronger top-line performance, with net revenue of $675,161 versus $206,870 in the prior-year quarter and a swing to operating income of $40,253. Operating cash flow turned positive at $75,232, a notable improvement from prior cash usage.
However, the balance sheet remains highly stressed. Stockholders’ deficit was $3,148,009, working capital deficit was $3,725,388, and related-party notes payable to the CEO totaled $3,361,065 at 10% interest. Management explicitly states there is “substantial doubt” about the ability to continue as a going concern without new capital and additional revenue.
Legal and control factors add risk. An adversary proceeding challenges ownership of roughly $503,000 of intangible assets, and management acknowledges ineffective disclosure controls and internal control over financial reporting due to limited personnel and governance gaps. Future filings for periods after March 31, 2026 will be important to see whether revenue growth persists and whether liquidity pressures ease.
Key Figures
Key Terms
going concern financial
deferred revenue financial
stock appreciation rights financial
related party notes payable financial
reverse stock split financial
internal control over financial reporting financial
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
For quarterly period ended
Commission file number:
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization)
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Registrant’s telephone number, including area code:
(
Securities registered pursuant to Section 12(b) of the Act:
NONE
Securities registered pursuant to Section 12(g) of the Act:
| Title of each class | Trading Symbol | Name of each exchange on which registered |
| OTCQB |
Indicate by check mark whether
the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. ☒
Indicate by check mark whether
the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T
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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act:
| Large Accelerated Filer ☐ | Accelerated Filer ☐ | |
| Small Reporting Company | ||
| Emerging Growth Company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether
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As of May 15, 2026 the issuer
had
KWIKCLICK, INC.
TABLE OF CONTENTS
| Page | ||
| PART I | FINANCIAL INFORMATION | |
| Item 1. | Financial Statements | 3 |
| Condensed Consolidated Balance Sheets, March 31, 2026 (Unaudited) and December 31, 2025 | 3 | |
| Condensed Consolidated Statements of Operations for the Three Months ended March 31, 2026 and 2025 (Unaudited) | 4 | |
| Condensed Consolidated Statements of Stockholders’ Deficit for the Three Months ended March 31, 2026 and 2025 (Unaudited) | 5 | |
| Condensed Consolidated Statements of Cash Flows for the Three Months ended March 31, 2026 and 2025 (Unaudited) | 6 | |
| Notes to Condensed Consolidated Financial Statements (Unaudited) | 7 | |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 17 |
| Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 19 |
| Item 4. | Controls and Procedures | 19 |
| PART II. | OTHER INFORMATION | |
| Item 1. | Legal Proceedings | 21 |
| Item 1A. | Risk Factors | 21 |
| Item 2. | Unregistered Sales of Equity Securities | 21 |
| Item 3. | Defaults Upon Senior Securities | 21 |
| Item 4. | Mine Safety Disclosures | 21 |
| Item 5. | Other Information | 21 |
| Item 6. | Exhibits | 21 |
| SIGNATURES | 22 | |
| 2 |
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
KWIKCLICK, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
| March 31, | December 31, | |||||||
| 2026 | 2025 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash | $ | $ | ||||||
| Accounts receivable, net | ||||||||
| Costs capitalized to obtain revenue contracts | ||||||||
| Prepaid expenses | ||||||||
| Other receivable | ||||||||
| Total current assets | ||||||||
| Equipment, net | ||||||||
| Capitalized internal-use software | ||||||||
| Intellectual property, net | ||||||||
| Right-of-use asset | ||||||||
| Security deposit | ||||||||
| Total assets | $ | $ | ||||||
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | $ | ||||||
| Accrued expenses | ||||||||
| Operating lease liability | ||||||||
| Deferred revenue | ||||||||
| Related-party notes payable | ||||||||
| Total current liabilities | ||||||||
| Long-term liabilities: | ||||||||
| Operating lease liability, net of current portion | ||||||||
| Total liabilities | ||||||||
| Stockholders’ deficit | ||||||||
| Preferred stock, $ | ||||||||
| Common stock, $ | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total stockholders’ deficit | ( | ) | ( | ) | ||||
| Total liabilities and stockholders’ deficit | $ | $ | ||||||
The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.
| 3 |
KWIKCLICK, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| For the Three Months Ended | ||||||||
| March 31, | ||||||||
| 2026 | 2025 | |||||||
| Revenues: | ||||||||
| Custom design services | $ | $ | ||||||
| Brand services | ||||||||
| Software maintenance | ||||||||
| Net revenue | ||||||||
| Operating costs and expenses: | ||||||||
| Cost of sales | ||||||||
| Management and payroll | ||||||||
| Research and development | ||||||||
| General and administrative | ||||||||
| Total operating costs and expenses | ||||||||
| Operating income (loss) | ( | ) | ||||||
| Other income (expense) | ||||||||
| Interest expense - related party | ( | ) | ( | ) | ||||
| Interest expense - other | ( | ) | ||||||
| Gain on liability settlement | ||||||||
| Total other income (expense) | ( | ) | ||||||
| Loss before income taxes | ( | ) | ( | ) | ||||
| Provision for income taxes | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Basic and diluted loss per share | $ | ( | ) | $ | ( | ) | ||
| Weighted average shares outstanding - basic and diluted | ||||||||
The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.
| 4 |
KWIKCLICK, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT
(Unaudited)
| Additional | Total | |||||||||||||||||||
| Common Stock | Paid-in | Accumulated | Stockholders’ | |||||||||||||||||
| Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||
| Balance December 31, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Stock-based compensation | – | – | – | |||||||||||||||||
| Stock appreciation rights issued for settlement of accrued compensation | – | – | – | |||||||||||||||||
| Net Loss | – | – | – | ( | ) | ( | ) | |||||||||||||
| Balance March 31, 2026 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Balance December 31, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Stock-based compensation | – | – | – | |||||||||||||||||
| Net Loss | – | – | – | ( | ) | ( | ) | |||||||||||||
| Balance March 31, 2025 | $ | $ | $ | ( | $ | ( | ) | |||||||||||||
The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.
| 5 |
KWIKCLICK, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| For the Three Months Ended | ||||||||
| March 31, | ||||||||
| 2026 | 2025 | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||
| Depreciation and amortization | ||||||||
| Amortization of right-of-use asset | ||||||||
| Amortization of costs capitalized to obtain revenue contracts | ||||||||
| Stock-based compensation | ||||||||
| Gain on liability settlement | ( | ) | ||||||
| Bad debt expense | ||||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | ( | ) | ||||||
| Other receivable | ( | ) | ||||||
| Prepaid expenses | ||||||||
| Security deposit | ( | ) | ||||||
| Accounts payable | ( | ) | ( | ) | ||||
| Accrued expenses | ||||||||
| Operating lease liability | ( | ) | ( | ) | ||||
| Deferred revenue | ( | ) | ||||||
| Accrued interest added to related-party notes payable | ||||||||
| Net cash provided by (used in) operating activities | ( | ) | ||||||
| Cash flows from investing activities | ||||||||
| Capitalization of internal-use software | ( | ) | ||||||
| Net cash used in investing activities | ( | ) | ||||||
| Net increase (decrease) in cash | ( | ) | ||||||
| Cash at beginning of period | ||||||||
| Cash at end of period | $ | $ | ||||||
| Supplemental disclosure of cash flow information: | ||||||||
| Cash paid for income taxes | $ | $ | ||||||
| Cash paid for interest | $ | $ | ||||||
| Supplemental disclosure of non-cash investing and financing activities: | ||||||||
| SARs issued to settle accrued compensation | $ | $ | ||||||
| Increase in capitalized internal-use software with accounts payable | $ | $ | ||||||
| Right-of-use asset obtained in exchange for operating lease liability | $ | $ | ||||||
The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.
| 6 |
KWIKCLICK, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1. BUSINESS
KwikClick, Inc., (the “Company” or “Kwik”) was organized pursuant to the laws of the State of Delaware on November 16, 1993. Beginning in 2020, the Company commenced its KwikClick business operations to allow sellers to make products or services available on the KwikClick platform, at Kwik.com, offering a self-determined incentive budget on goods or services in exchange for exposure and substantially increased sales volume. KwikClick is a social interaction, selling, and referral software platform that allows stores and manufacturers (“Brands”) wishing to promote their products or services on the KwikClick software platform to connect with promoters, influencers, and customers. The Company aims to provide an industry leading instant word-of-mouth growth with a platform built to turn every customer into your best salesperson—plus loyalty, cashback, and influencer tools that make it all scale.
Going Concern
Since the commencement of the Kwik platform, the Company has accumulated deficits; experienced negative operating cash flows with the exception of the quarter ended March 31, 2026; and has a working capital deficit. The Company will require additional funding to finance the growth of its future operations as well as to achieve its strategic objectives. This raises substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company’s ability to raise additional capital and generate revenue. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”), including the instructions to Form 10-Q and Regulation S-X. Certain information and note disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”), have been condensed or omitted from these statements pursuant to such rules and regulations and, accordingly, they do not include all the information and notes necessary for comprehensive financial statements and should be read in conjunction with our audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2025.
In management’s opinion, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of only normal recurring adjustments, necessary for the fair statement of the Company’s financial position, its results of operations, and its cash flows for the interim periods presented. The results of operations for the three months ended March 31, 2026, are not necessarily indicative of the results to be expected for the full fiscal year or any other period.
| 7 |
Reclassifications
Certain amounts in the 2025 condensed consolidated balance sheet and condensed consolidated statement of operations have been reclassified to conform with the current period presentation.
Use of Estimates
The preparation of 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 financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Principles of Consolidation
The accompanying condensed consolidated financial statements include the accounts of KwikClick, Inc. and its wholly owned subsidiaries KwikClick LLC and Kwik B.V. i.o., a Netherlands based subsidiary (collectively, the Company). Intercompany transactions and balances have been eliminated in consolidation.
Segments
The Company has one reportable operating segment.
Cash and Cash Equivalents
Cash equivalents include all highly liquid investments
with an original maturity of three months or less when purchased. The Company did
Net Loss Per Share
The Company presents both basic and diluted earnings
per share (EPS) on the face of the statements of operations. Basic EPS is computed by dividing net loss by the weighted average number
of shares outstanding during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period
under the treasury stock method using the if-converted method. Due to the incurrence of net losses, the Company did not include outstanding
instruments convertible into common stock that would be anti-dilutive. As of March 31, 2026, the Company had approximately
| 8 |
Revenue Recognition
The Company determines the measurement of revenue and the timing of revenue recognition utilizing the following core principles:
| · | Step 1: Identify the contract with the customer | |
| · | Step 2: Identify the performance obligations in the contract | |
| · | Step 3: Determine the transaction price | |
| · | Step 4: Allocate the transaction price to the performance obligations in the contract | |
| · | Step 5: Recognize revenue when the Company satisfies a performance obligation |
Revenue is measured based on the amount of consideration that the Company expects to receive, reduced by estimates for return allowances, promotional discounts, and rebates. Revenue excludes any amounts collected on behalf of third parties and indirect taxes.
A description of the Company’s revenue generating activities is as follows:
Third-Party Seller Services (Brand Services Revenue):
The Company offers programs that provide sellers a software platform to sell their products. For some contracts the Company provides payment processing and order fulfillment facilitation. The Company is not the seller of record in these transactions and acts as an agent in the facilitation of the transaction, recognizing the net revenue as our processing fee. For other contracts, the Company provides a more robust promotional and campaign management service whereby the Company controls discounts, rebates, commission rates and cross-selling features to the seller. Under this arrangement the Company invoices for the “incentive budget” from which these services are funded and for which the Company recognizes gross revenue acting as principal in this transaction. For contracts, where the Company takes control of the “incentive budget” the Company has determined it is the principal in the transaction as the Company has full control of how the incentive budget is deployed in promotional campaigns to drive sales of customers’ products. In the event the incentive budget is more than adequate to accomplish minimum predetermined campaign activities, the Company benefits by the increase in profitability for its campaign services. In the event the incentive budget is not sufficient to cover predetermined campaign activities, the Company will invoice for a larger budget in order to accomplish the objectives of the campaign. If the budget is sufficient for minimum predetermined campaign objectives, then the Company is responsible for any augmentative activities related to campaign performance, thus potentially reducing the Company’s overall profitability of the campaign.
The Company generally determines stand-alone revenue based on a percentage of the prices charged by the seller to deliver products sold. The commissions and any related fulfillment, shipping, and transaction processing fees the Company earns from these arrangements are recognized when the services are rendered. Certain Brand Services contracts require a significant integration (implementation) by the Company for the customer to realize the intended benefit of the contract, which is a fully operational instance of the KwikClick platform integrated into the customer’s IT infrastructure. In these contracts, the Company has determined the implementation and ongoing subscription to the software platform are not on their own distinct performance obligations in the context of the contract but rather combine into one unit of accounting that is a distinct performance obligation. In these arrangements, revenue for the implementation is deferred and combined with the subscription revenue and recognized over the contract term upon the implementation being complete and the software subscription beginning.
| 9 |
Custom Design Services
The Company provides custom-brand programming services in which it builds features for the third-party sellers. Such services often include building a shopping cart integration, revised or updated affiliate commission tracking system, and reporting functionality. These custom programming features, when built by the Company, are designed to integrate into the Company’s software platform; however, the custom design features can be used without the Company’s platform. The Company has determined custom design services are distinct in the context of the contract as the customer can benefit from the custom design services on its own as the features do not require the Company’s software platform for the customer to derive value, and they are separately identifiable promises in the contract. These custom design services are performed over a specified term for a fixed monthly fee. Revenue under these arrangements is recognized ratably over the custom design period, which generally is the contract term. Additionally, the customer simultaneously receives and consumes the benefit provided by the Company as the performance of the custom design services enhances and/or creates assets that the customer controls, while the assets are being enhanced or created – i.e. the features enhanced or created by the Company (e.g. shopping cart integration, revised or updated affiliate commission tracking system, and reporting functionality) are built into the customer’s existing IT infrastructure for ongoing use without the Company’s required ongoing involvement or its software platform.
Software Maintenance.
Software Maintenance services are offered on a monthly basis for a fixed amount for a certain number of hours per month, with additional fees for excess hours, if required. The Company has determined maintenance fees are distinct in the context of the contract as the customer elects to include the maintenance services and the services are separately identifiable promises in the contract. The maintenance services are performed as needed. Revenue under these arrangements is recognized monthly as earned during the period of the contract.
Contract Assets and Contract Liabilities
The Company records any amounts due or payments received from customers prior to the Company fulfilling its performance obligation(s) as deferred revenue. The timing of revenue recognition, billings and cash collections results in billed accounts receivable (contract assets) and deferred revenue (contract liabilities) on the condensed consolidated balance sheets. Deferred revenue is for sales where the right to payment exists or payment has been received, but control has not been transferred.
The beginning and ending contract balances were as follows:
| Schedule of contract assets and liabilities | ||||||||||||
| March 31, 2026 | December 31, 2025 | December 31, 2024 | ||||||||||
| Accounts receivable, net | $ | $ | $ | |||||||||
| Deferred revenue | $ | $ | $ | |||||||||
| 10 |
Cost to Obtain Revenue Contracts
Applicable sales commissions paid in
connection with contracts exceeding one year are capitalized and amortized over the period of benefit, which has been determined to
be the contract term. During the three months ended March 31, 2026, the Company recognized $
Return Allowances
The fees earned by the Company are subject
to returns under similar terms as set by the third-party services using the Company’s software platform. The Company does not
assume responsibility for refund or replacement of product costs. Return allowances, which reduce revenue and cost of sales, are
estimated using historical experience. During the quarters ended March 31, 2026 and 2025, the
Company did
Cost of Sales
Cost of sales primarily consist of programming costs related to our custom design services and promotional, marketing, campaign management and consulting services, and commissions and rebates paid to third party influencers and consumers for brand services. Payment processing and related transaction costs, including those associated with seller transactions, are classified in general and administrative expenses on our condensed consolidated statements of operations.
Recent Accounting Pronouncements
From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) under its accounting standard codifications (“ASC”) or other standard setting bodies and adopted by the Company as of the specified effective date, unless otherwise discussed below.
New Accounting Pronouncements, Adopted
In November 2024, the FASB issued ASU 2024-04, Debt - Debt with Conversion and Other Options, which clarifies the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. The new guidance is effective for reporting annual periods beginning after December 15, 2025 and can be applied either prospectively or retrospectively. Early adoption is permitted. The Company adopted this ASU effective January 1, 2026, and there was not a material impact to the Company’s condensed consolidated financial statements and related disclosures.
New Accounting Pronouncements, Not Yet Adopted
In October 2023, the FASB issued ASU 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative, which modifies the disclosure or presentation requirements related to variety of FASB Accounting Standard Codification topics. The effective date for each amendment will be the date on which the SEC’s removal of that related disclosure from Regulation S-X or Regulation S-K is effective. If by June 30, 2027, the SEC has not removed the applicable requirement from Regulation S-X or Regulation S-K, the pending content of the associated amendment will be removed from the Codification and will not become effective for any entities. The Company is currently evaluating the effect of adopting this ASU on its condensed consolidated financial statements and related disclosures.
| 11 |
On November 2024, the FASB issued ASU 2024-03 - Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The ASU requires more detailed disclosures about the types of expenses in commonly presented expense captions such as cost of sales, selling, general and administrative expenses and research and development expenses. This includes separate footnote disclosure for expenses such as purchases of inventory, employee compensation, depreciation, and intangible asset amortization. Public business entities are required to apply the guidance prospectively and may apply it retrospectively. The ASU’s amendments are effective for public business entities for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Public business entities are required to apply the guidance prospectively and may apply it retrospectively. The Company is currently evaluating the effect of adopting this ASU on its condensed consolidated financial statements and related disclosures.
In May 2025, the FASB issued ASU 2025-04, Compensation—Stock Compensation (ASC Topic 718) and Revenue from Contracts with Customers (ASC Topic 606), which clarifies the accounting for share-based payments granted to customers, including classification of performance conditions, treatment of forfeitures, and application of the variable consideration constraint. The guidance will first be effective in annual disclosures for the year ending December 31, 2027, and may be applied prospectively or retrospectively. Early adoption is permitted. The Company has not granted any share-based payments to customers. As such, the Company does not expect ASU 2025-04 to have a material impact on the condensed consolidated financial statements or related disclosures.
In September 2025, the FASB issued ASU 2025-06, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. This guidance removes all references to project stages throughout ASC 350-40 and clarifies the threshold entities apply to begin capitalizing costs. Under the new standard, cost capitalization should only commence when an entity has committed to funding a software project and it is probable the project will be completed and the software will be used for its intended function. The amendments are effective for annual reporting periods beginning after December 15, 2027 and interim reporting periods within those annual reporting periods. Entities may apply the guidance using a prospective, retrospective or modified transition approach. Early adoption is permitted as of the beginning of an annual reporting period. The Company is currently evaluating the impact this standard will have on its condensed consolidated financial statements.
In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements. ASU 2025-11 clarifies and improves existing interim reporting guidance by consolidating disclosure requirements within Topic 270 and introducing a disclosure principle requiring entities to disclose events and changes occurring after the most recent annual reporting period that are expected to have a material effect on the entity’s financial condition or results of operations. The ASU does not introduce significant changes to recognition or measurement guidance. The amendments in ASU 2025-11 are effective for interim reporting periods within fiscal years beginning after December 15, 2027, with early adoption permitted. ASU 2025-11 allows for either a prospective or retrospective approach on adoption. The Company is currently evaluating the impact of ASU 2025-11 on its condensed consolidated financial statements and related disclosures.
The Company currently believes there are no other issued and not yet effective accounting standards that are materially relevant to its condensed consolidated financial statements.
NOTE 3. RELATED PARTY TRANSACTIONS
The Company’s related party notes payable consist of the following:
| Schedule of related party loans | ||||||||
| March 31, 2026 | December 31, 2025 | |||||||
| Related party notes payable with a nominal interest rate of 10% per annum due on demand | $ | $ | ||||||
| Accrued interest | ||||||||
| Total related party notes payable | $ | $ | ||||||
| 12 |
In the event that we default on the note
payable from Fred Cooper, CEO, Mr. Cooper may take possession of our intellectual property and other assets. This could have a material
adverse effect on our business and operations. During the three months ended March 31, 2026 and 2025, the Company recognized
interest expense of $
NOTE 4. STOCKHOLDERS’ DEFICIT
Stock-Based Compensation
Stock Appreciation Rights
During the three months ended March 31, 2026,
the Company issued
The Company estimated the fair values of the SARs
on the grant dates using a Black-Scholes options pricing model using the quoted market prices of the Company’s stock on the grant
dates; exercise prices ranging from $1.42 to $2.29 per share; expected volatilities of
A summary of the stock appreciation rights activity is as follows:
| Schedule of stock appreciation rights activity | ||||||||||||
| Weighted | ||||||||||||
| Average | ||||||||||||
| Stock | Weighted | Remaining | ||||||||||
| Appreciation | Average | Contractual | ||||||||||
| Rights | Exercise Price | Term (Years) | ||||||||||
| Outstanding at January 1, 2026 | $ | |||||||||||
| Granted | ||||||||||||
| Exercised | ||||||||||||
| Forfeited, cancelled or expired | ||||||||||||
| Outstanding at March 31, 2026 | $ | |||||||||||
| Exercisable at March 31, 2026 | $ | |||||||||||
| 13 |
Warrants
During the three months ended March 31,
2026, the Company issued
The Company estimated the fair values of the warrants
issued on the grant date using a Black-Scholes options pricing model using the quoted market price of the Company’s stock on the
grant date; exercise price of $1.30 per share; expected volatility of approximately
A summary of the common stock warrant activity is as follows:
| Schedule of warrant activity | ||||||||||||
| Weighted | ||||||||||||
| Average | ||||||||||||
| Weighted | Remaining | |||||||||||
| Average | Contractual | |||||||||||
| Warrants | Exercise Price | Term (Years) | ||||||||||
| Outstanding at January 1, 2026 | $ | |||||||||||
| Granted | ||||||||||||
| Exercised | ||||||||||||
| Forfeited, cancelled or expired | ||||||||||||
| Outstanding at March 31, 2026 | $ | |||||||||||
| Exercisable at March 31, 2026 | $ | |||||||||||
For the three months ended March 31, 2026 and
2025, the Company recognized stock-based compensation totaling $
As of March 31, 2026, the Company has committed
NOTE 5. OPERATING LEASE
On February 1, 2025, the Company entered into
an operating lease for its Bountiful, Utah corporate headquarters under a non-cancellable lease arrangement.
The following table summarizes the Company’s future undiscounted cash payment obligations for each calendar year as of March 31, 2026, for its non-cancelable lease liabilities through the end of the expected term of the lease:
| Schedule of future lease obligations | ||||
| 2026 | $ | |||
| 2027 | ||||
| Total undiscounted cash payments | ||||
| Less imputed interest | ( | ) | ||
| Present value of payments | $ | |||
| 14 |
For the three months ended March 31, 2026 and
2025, the Company recognized lease expense associated with its non-cancelable operating lease totaling $
NOTE 6. COMMITMENTS AND CONTINGENCIES
On May 31, 2023, NAI Liquidation Trust, the successor in interest to the defunct NewAge, Inc. (NewAge) by and through its Liquidation Trustee, Steven Balasiano, filed an adversary proceeding against the Company in the NewAge Chapter 11 bankruptcy case (Delaware Case #22-10819). The Company licensed some of its technology to NewAge pursuant to a license agreement that started in September 2021 and terminated in late 2022. A prior adversarial action was brought by NewAge in the same bankruptcy case but was never served and was dismissed on June 1, 2023. Like the prior dismissed action, NAI Liquidation Trust contends that they are the rightful owner of KwikClick’s intellectual property. NAI Liquidation Trust brings several causes of action related to that contention.
The Company believes that the code base and functionality of its software platform differs materially from any intellectual property owned by NewAge. The Company intends to vigorously defend and assert its intellectual property rights. In the event the Company does not prevail it may be required to impair substantially all of its intangible assets with a carrying value of approximately $503,000 at March 31, 2026 and may be forced to discontinue its on-going fee-based sales platform. The litigation has been delayed and an estimate of a reasonably possible loss cannot be made at this time. As such, there has been no further adjustment to the accompanying condensed consolidated financial position, results of operations, or cash flows as of and for the three months ended March 31, 2026.
NOTE 7. SUBSEQUENT EVENTS
The Company has evaluated subsequent events through the date the consolidated financial statements were available to be issued and has determined that there are no material events that need to be disclosed.
NOTE 8. SEGMENT INFORMATION
The Company has one reportable and operating segment which provides customers the platform to sell their products or services. The accounting policies of this operating segment are the same as those described in the summary of significant accounting policies. The Company’s chief operating decision maker (“CODM”) is its President and CEO.
The CODM’s measure of segment profit or loss is net income or loss. For purposes of evaluating performance and allocating resources, the CODM reviews the financial information and evaluates net income against comparable prior periods and the Company’s forecast. The Company derives nearly all of its revenue from United States of America (“US”) based customers with an immaterial amount coming from foreign based customers. Additionally, two US-based customers provided the majority of the custom design services revenue recognized during the three months ended March 31, 2026. No other material revenue was recognized from a single customer for the three months ended March 31, 2026 and 2025.
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In addition to the significant expense categories included within net income or loss presented on the Company’s condensed consolidated statements of operations, the following are disaggregated research and development expenses for the three months ended March 31:
| Schedule of research and development expenses by segment | ||||||||
| 2026 | 2025 | |||||||
| Platform coding and development | $ | $ | ||||||
| Other third-party engineering | ||||||||
| Total research and development expense | $ | $ | ||||||
The measure of segment assets is reported on the condensed consolidated balance sheet as total consolidated assets. All the Company’s long-lived assets are located in the United States. The Company does not have intra-entity sales or transfers.
NOTE 9. REVERSE STOCK SPLIT
On June 26, 2025, the Company effected a
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Forward-Looking Statements
As used in this Form 10-Q, references to the “Company,” “KwikClick,” “KWIK,” “we,” “our” or “us” refer to KwikClick, Inc. and KwikClick, LLC, unless the context otherwise indicates.
This Management’s Discussion and Analysis (“MD&A”) section discusses our results of operations, liquidity and financial condition and certain factors that may affect our future results. You should read this MD&A in conjunction with our financial statements and accompanying notes included elsewhere in this report.
This Quarterly Report on Form 10-Q contains statements that are considered forward-looking statements. Forward-looking statements give the Company’s current expectations and forecasts of future events. All statements other than statements of current or historical fact contained in this quarterly report, including statements regarding the Company’s future financial position, business strategy, budgets, projected costs and plans and objectives of management for future operations, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “estimate,” “expect,” “intend,” “may,” “plan,” and similar expressions, as they relate to the Company, are intended to identify forward-looking statements. These statements are based on the Company’s current plans, and the Company’s actual future activities and results of operations may be materially different from those set forth in the forward-looking statements. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from the statements made. Any or all of the forward-looking statements in this annual report may turn out to be inaccurate. The Company has based these forward-looking statements largely on its current expectations and projections about future events and financial trends that it believes may affect its financial condition, results of operations, business strategy and financial needs. The forward-looking statements can be affected by inaccurate assumptions or by known or unknown risks, uncertainties and assumptions. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events occurring after the date hereof. All subsequent written and oral forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by the cautionary statements contained in this quarterly report.
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes that appear in our annual report on Form 10-K filed with the U.S. Securities and Exchange Commission (“SEC”) on March 31, 2026. In addition to historical consolidated financial information, the following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Certain information included herein contains statements that may be considered forward-looking statements, such as statements relating to our anticipated revenues and operating results, future performance and operations, plans for future expansion, capital spending, sources of liquidity and financing sources. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future, and accordingly, such results may differ from those expressed in any forward-looking statements made herein. These risks and uncertainties include the “Risk Factors” included in our annual report on Form 10-K filed with the SEC on March 31, 2026, that can be read at www.sec.gov.
Although we have sought to identify the most significant risks to our business, we cannot predict whether, or to what extent, any of such risks may be realized, nor can there be any assurance that we have identified all possible issues which we might face. For all of these reasons, the reader is cautioned not to place undue reliance on forward-looking statements contained herein, which speak only as of the date hereof. We assume no responsibility to update any forward-looking statements as a result of new information, future events, or otherwise except as required by law.
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Overview
KwikClick, Inc., (the “Company” or “Kwik”) was organized pursuant to the laws of the State of Delaware on November 16, 1993. Beginning in 2020, the Company commenced its KwikClick business operations to allow sellers to make products or services available on the KwikClick platform, at Kwik.com, offering a self-determined incentive budget on goods or services in exchange for exposure and substantially increased sales volume. KwikClick is a social interaction, selling, and referral software platform that allows stores and manufacturers (“Brands”) wishing to promote their products or services on the KwikClick software platform to connect with promoters, influencers, and customers. The Company aims to provide an industry leading instant word-of-mouth growth with a platform built to turn every customer into your best salesperson—plus loyalty, cashback, and influencer tools that make it all scale.
Comparison of operations for the Three Months ended March 31, 2026 and March 31, 2025
Revenues
During the three months ended March 31, 2026 and 2025, we recognized net revenues of $675,161 and $206,870, respectively. The $468,291 increase is primarily the result of the expansion of our custom design services in which we build custom software features for customers that are generally done in addition to embedding our transaction platform into a customer’s website. Additionally, brand services revenue increased $114,116, from $22,370 in the three months ended March 31, 2025, to $136,486 in the three months ended March 31, 2026. The increase is due to a broadening adoption of the sales platform by new brands and influencers. We intend to continue to pursue providing these products and services which we expect to drive increases in our brand services on a perpetual basis.
Cost of Sales
Our costs of sales increased $124,684 to $193,707 for the three months ended March 31, 2026 as compared to $69,023 for the three months ended March 31, 2025. The expansion of our custom design business requires higher labor costs than our brand services. We expect the costs of revenue to increase as sales increase, but at a slower pace if we are successful in the expansion of the custom design services. Additionally, we would expect our sales volume and cost of sales to correspondingly increase as more brands launch our platform within their own website. The underlying products and services sold through our platform are currently unpredictable.
Other Operating Expenses
During the three months ended March 31, 2026 and 2025, we incurred total other operating expenses of $441,201 and $315,470 respectively. The $125,731 increase resulted from an increase in management and payroll of $112,635, an increase in general and administrative expenses of $22,787, and offset by a decrease in research and development of $9,691.
Other Income (Expense)
During the three months ended March 31, 2026, other income (expense) was made up entirely of interest expense of $67,498. Interest expense increased by $4,826 during the three months ended March 31, 2026, of which related-party interest increased by $4,612 to $67,284 and non-related-party interest increased by $214 to $214. The increase in related-party interest was the result of continued compounding (at a rate of 10% per annum) of our unpaid related-party notes payable outstanding. If we are successful in increasing our customer base, we do not expect an increase in the principal balance of the notes payable over the next twelve months to fund expenses required for an expansion of our customer base.
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During the three months ended March 31, 2025, the Company negotiated settlements with previous brands surrounding previously accrued commissions payable on their behalf for no additional consideration resulting in a gain on settlement totaling $147,527. We do not expect these settlements to occur on a frequent basis in the future.
Liquidity and capital resources
At March 31, 2026, we had a working capital deficit of $3,725,388. Approximately 83% of our liabilities as of March 31, 2026 are due to our founder, majority shareholder, and CEO, Mr. Fred Cooper, under a note payable arrangement carrying an interest rate of 10% per annum. Mr. Cooper has informally agreed to defer repayment of the note until the Company has achieved a more stable liquidity position; however, he is not legally obligated to continue to do so.
We require additional capital to continue to operate our business, and to develop and expand our business. Sources of additional capital through various financing transactions or arrangements with third parties may include equity or debt financing, bank loans or revolving credit facilities. We may not be successful in locating suitable financing transactions in the time period required or at all, and we may not obtain the capital we require by other means.
Off-Balance Sheet Arrangements
The Company does not have any off-balance sheet arrangements.
Critical Accounting Estimates
There has been no change in our critical accounting estimates from those disclosed in our annual report on Form 10-K filed with the SEC on March 31, 2026.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Not applicable.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Based on an evaluation under the supervision and with the participation of our management, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act were not effective as of March 31, 2026 to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms and (ii) accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. Based on this evaluation, our management concluded that, as of March 31, 2026, our internal control over financial reporting was not effective due to (i) insufficient segregation of duties in the finance and accounting functions due to limited personnel; and (ii) inadequate corporate governance policies. In the future, subject to working capital limitations, we intend to take appropriate and reasonable steps to make improvements to remediate these deficiencies.
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Changes in Internal Control Over Financial Reporting
There have not been any changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) under the Exchange Act) during the fiscal period to which this report relates that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Inherent Limitations of the Effectiveness of Internal Controls
A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the internal control system are met. Because of the inherent limitations of any internal control system, no evaluation of controls can provide absolute assurance that all control issues, if any, within a company have been detected.
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PART II. OTHER INFORMATION
Item 1. Legal Proceedings
There has been no change in our legal proceedings as disclosed in our annual report on Form 10-K as filed with the Securities and Exchange Commission on March 31, 2026.
Item 1A. Risk Factors
The Risk Factors identified in our Annual Report on Form 10-K for the year ended December 31, 2025, which was filed on March 31, 2026, continue to represent the most significant risks to the Company’s future results of operations and financial condition.
Item 2. Unregistered Sales of Equity Securities
There were no unregistered sales of equity securities not previously disclosed.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not Applicable.
Item 5. Other Information
During the quarter ended March
31, 2026, no director or officer
Item 6. Exhibit
| Exhibit No. | Description | |
| This Form 10-Q | ||
| 31.1 | Certification of principal executive officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 executed by Fred Cooper | |
| 31.2 | Certification of principal financial officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 executed by Jeffrey Yates | |
| 32.1 | Certification of principal executive officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 executed by Fred Cooper | |
| 32.2 | Certification of principal financial officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 executed by Jeffrey Yates | |
| 101.INS | XBRL Instance Document | |
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase | |
| 101.LAB | XBRL Taxonomy Extension Label Linkbase | |
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase | |
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase | |
| 101.SCH | XBRL Taxonomy Extension Schema | |
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| KwikClick, Inc. | ||
| By: | /s/ Fred Cooper | |
| Fred Cooper | ||
| Chief Executive Officer | ||
| Principal Executive Officer | ||
| Date: May 15, 2026 | ||
| By: | /s/ Jeffrey Yates | |
| Jeffrey Yates | ||
| Principal Financial Officer | ||
| Date: May 15, 2026 | ||
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