Quarterly Report for Quarter Ending June 30, 2025 (Form 10-Q)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

The following discussion should be read in conjunction with our consolidated financial statements("CFS") and related notes included elsewhere in this report. In addition to historical information, this discussion includes forward-looking information that involves risks and assumptions, which could cause actual results to differ materially from management's expectations. See "Forward-Looking Statements" included in this report.

Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements, including without limitation, statements related to our plans, strategies, objectives, expectations, intentions and adequacy of resources. Investors are cautioned that such forward-looking statements involve risks and uncertainties including without limitation the following: (i) our plans, strategies, objectives, expectations and intentions are subject to change at any time at our discretion; (ii) our plans and results of operations will be affected by our ability to manage growth; and (iii) other risks and uncertainties indicated from time to time in our filings with the Securities and Exchange Commission.

In some cases, you can identify forward-looking statements by terminology such as ''may,'' ''will,'' ''should,'' ''could,'' ''expects,'' ''plans,'' ''intends,'' ''anticipates,'' ''believes,'' ''estimates,'' ''predicts,'' ''potential,'' or ''continue'' or the negative of such terms or other comparable terminology. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of such statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. We are under no duty to update any of the forward-looking statements after the date of this Report.

This section of the report should be read together with Footnotes of the Company audited financials for the year ended December 31, 2024, the unaudited statements of operations for the three and six months ended June 30, 2025 and 2024 are compared in the sections below.

General Overview

Organization and Line of Business

GBT Technologies Inc. (the "Company", "GBT", or "GTCH") was incorporated on July 22, 2009 under the laws of the State of Nevada. The Company is targeting growing markets such as development of Internet of Things (IoT) and Artificial Intelligence (AI) enabled networking and tracking technologies, including wireless mesh network technology platform and fixed solutions, development of an intelligent human body vitals device, asset-tracking IoT, and wireless mesh networks. The Company derived revenues from (i) the provision of IT consulting services; and (ii) from the licensing of its technology. (ii) from selling electronic products through e-commerce platforms (until the period June 30, 2023 as then this operation was terminated on July 1, 2023.)

On July 20, 2023, the Company through its wholly owned subsidiary, Greenwich International Holdings, a Costa Rica corporation ("Greenwich"), entered into an Amended and Restated Joint Venture (the "2023 Tokenize Agreement") with Magic Internacional Argentina FC, S.L. ("Magic") and GBT Tokenize Corp ("GBT Tokenize"). GBT Tokenize has developed a vital device based on the Technology Portfolio that is ready for commercialization, as well as certain derivative technologies, which positioned GBT Tokenize to further develop or license certain code sources. On April 3, 2023, GBT Tokenize entered its first commercial transaction to date through the sale of Avant-AI! technology that has been developed by GBT Tokenize, based on the Technology Portfolio. Effective as of March 20, 2024, Tokeniz, entered into a Patent Purchase Agreement with VisionWave Technologies Inc. ("VisionWave") pursuant to which VisionWave agreed to acquire from Tokenize the entire right, title, and interest of certain patents and patent applications providing an intellectual property basis for a machine learning driven technology that controls radio wave transmissions, analyzes their reflections data, and constructs 2D/3D images of stationary and in motion objects ("VisionWave PPA").

The unaudited condensed financial statements ("CFS") are prepared by the Company, pursuant to the rules and regulations of the SEC. The information furnished herein reflects all adjustments, consisting only of normal recurring adjustments, which in the opinion of management, are necessary to fairly state the Company's financial position, the results of its operations, and cash flows for the periods presented.

Results of Operations:

Three Months Ended June 30, 2025 and 2024

A comparison of the statements of operations for the three months ended June 30, 2025 and 2024 is as follows:

		Three Months Ended June 30,								Change
		2025				2024				$				%
Operating expenses			114,010				176,078				(62,068	)			-27	%
Loss from operations			(114,010	)			(176,078	)			(62,068	)			-27	%
Other income (expenses)			(101,544	)			1,222,574				(1,324,118	)			-108	%
Income (Loss) before provision for income taxes			(215,554	)			1,046,496				(1,262,050	)			-121	%
Provision for income taxes			-				-				-				-
Net Income (Loss)		$	(215,554	)		$	1,046,496				(1,262,050	)			-121	%

Operating expenses for the three months ended June 30, 2025 were $114,010, compared to $176,078 for the same period in 2024. The decrease of $62,068 or -27% was principally due to the Company had limited cash flows to expand the business.

Other income (expense) for the three months ended June 30, 2025 was $(101,544), a decrease of $1,324,118 or 108% from income of $1,222,574 for the same period in 2024. The change is principally due to an decrease of derivative liabilities since all the converted note payables were amended to fixed conversion features in Q4 2024.

Net income (loss) for the three months ended June 30, 2025 was $(215,554) compared to $1,046,496 for the same period in 2024 due to the factors described above.

Six Months Ended June 30, 2025 and 2024

A comparison of the statements of operations for the six months ended June 30, 2025 and 2024 is as follows:

		Six Months Ended June 30,								Change
		2025				2024				$				%
Operating expenses			117,171				353,704				(236,533	)			-67	%
Loss from operations			(117,171	)			(353,704	)			(236,533	)			-67	%
Other income (expenses)			(200,783	)			8,560,088				(8,760,871	)			-102	%
Income (Loss) before provision for income taxes			(317,954	)			8,206,384				(8,524,338	)			-104	%
Provision for income taxes			-				-				-				-
Net Income (Loss)		$	(317,954	)		$	8,206,384				(8,524,338	)			-104	%

Operating expenses for the six months ended June 30, 2025 were $117,171, compared to $353,704 for the same period in 2024. The decrease of $236,533 or -67% was principally due to the Company had limited cash flows to expand the business.

Other income (expense) for the six months ended June 30, 2025 was $(200,783), a decrease of $8,560,088 or -104% from income of $8,760,871 for the same period in 2024. The change is principally due to an decrease of derivative liabilities since all the converted note payables were amended to fixed conversion features in Q4 2024.

Net income (loss) for the six months ended June 30, 2025 was $(317,954) compared to $8,524,338 for the same period in 2024 due to the factors described above.

Liquidity and Capital Resources

Going Concern

The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The Company has an accumulated deficit of $295,594,221 and has a working capital deficit of $10,241,537 as of June 30, 2025, which raises substantial doubt about its ability to continue as a going concern.

The Company's ability to continue as a going concern is dependent upon its ability to generate profitable operations in the future and/or obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management has plans to seek additional capital through some private placement offerings of debt and equity securities. These plans, if successful, will mitigate the factors which raise substantial doubt about the Company's ability to continue as a going concern. These consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might result from this uncertainty.

Our cash and cash equivalent were $0 and $6,131 at June 30, 2025 and 2024, respectively. Cash provided by (used in) operating activities during the period ended June 30, 2025 was $125 compared to $33,148 during the same period in 2024. The amount provided by operating activities for the period ended June 30, 2025 was primarily related to a net loss of $317,954 and offset by changes in fair value of marketable securities of $1,470, accounts payable of $296,635 and accounts payable - related parties of $19,724. Our working capital position changed by going from a working capital deficit of $9,940,379 at December 31, 2024 to a working capital deficit of $10,241,537 at June 30, 2025.

We sustained net loss of $317,954 for the six months ended June 30, 2025. In addition, we had an accumulated deficit of $295,594,221 and working capital deficit of $10,241,537 at June 30, 2025.

Dividends

The Company has not yet adopted any policy regarding payment of dividends. No cash dividends have been paid or declared since the Date of Inception.