Annual Report for Fiscal Year Ending 12-31, 2025 (Form 10-K)

Management's Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion should be read in conjunction with the consolidated, audited financial statements of the Company for the annual periods ended December 31, 2025, and December 31, 2024, that appear elsewhere in this report. 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. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this annual report.

Our audited financial statements are stated in United States Dollars and are prepared in accordance with accounting principles generally accepted in the United States of America.

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Overview

AiS has been engaged in the development of a digital sports betting and gaming platform. Our platform, when complete, will provide users with sports content, racing, and sports betting, and sport streaming solutions. We aim to create excitement and engagement and deliver the best experiences that enhance sports fandom. Users can access our products via multiple devices, including the web and mobile devices.

Apple iSports is at the forefront of the convergence between technology, gaming, media, and entertainment, particularly as the boundaries between sports, wagering, and entertainment continue to blur. Through our strategic business acquisitions and partnerships, we aim to address the critical infrastructure and connectivity gaps in today's rapidly evolving digital landscape. As demand for high-speed access to content via broadband, cellular, and satellite networks continues to surge, our mission is to enhance and expand the underlying systems that power next-generation media consumption. This investment in infrastructure not only ensures seamless streaming and interactive experiences for fans but also empowers athletes and content creators with the tools and platforms to reach broader audiences and unlock new monetization opportunities, such as iGaming opportunities and other forms of engagement.

AiS is seeking an Online Bookmaking License in Australia through the Northern Territory Racing Commission, which will enable racing and sports betting throughout the country, one of the most mature legal betting markets in the world. In addition, we are licensed in North Dakota as an (ADW) provider, subject to completion of the TRPB examination, which will allow us to provide pari-mutuel betting on racing in North Dakota and up to an additional 20 states that do not have specific regulations. NFL and other sports bets in the US are regulated separately from racing wagering. We will seek market access licenses for several states that offer sports betting licenses over a three-year timeline.

	·	Since the inception of AiS through December 31, 2025, we (i) established a core team with the industry skills and experience to manage the Company and (ii) received approximately $3,023,397 in private placement funding and received loans from related parties of more than $3,155,218.
	·	From December 2021 to October 2022, we developed our Go-to Market outline and marketing strategy, including identifying preferred suppliers for each product and initiating relationships with key suppliers and consultants.
	·	In June 2022, we submitted our application to the North Dakota Racing Commission for an (ADW) license, subject to the approval of the Thoroughbred Racing Protective Bureau. Completion of the TRPB examination is required to receive a state-issued ADW. This will be concluded after closing the capital raising.
	·	Effective March 23, 2023, we completed a change of control transaction pursuant to a Stock Exchange Agreement (the "Stock Exchange Agreement") with AiS and the shareholders of AiS. The stock exchange was accounted for under the business combination under the common control of accounting. Consequently, the assets and liabilities, as well as the historical operations, reflected in the financial statements before the stock exchange, and the historical operations that are reflected in the financial statements prior to the stock exchange are those of AiS and the Company combined. They are recorded at the historical cost basis, and the condensed consolidated financial statements after completion of the stock exchange include the combined assets and liabilities of AiS and the Company from the closing date of the stock exchange, as a result of the issuance of the shares of our common stock pursuant to the stock exchange, a change in control of the Company occurred as of the date of consummation of the transaction.
	·	In May 2023, we began brand awareness activities by advertising around Australia on SEN Radio, the largest sports radio network in Australia. As of December 2025, the contract was suspended until the Company moves closer to going live.
	·	In April 2025, we entered into a strategic and financial agreement with Pacifico Financial Group to accelerate various capital raising activities.
	·	In May 2025, we entered into a letter of intent to purchase AmeriCrew Inc, a leading telecommunications infrastructure provider. On or about July 13, 2025, the proposed transaction with AmeriCrew was terminated.
	·	In July 2025, we entered into a binding agreement to purchase LBC Enterprise Pty. Ltd. ("Lucky Bet"), a gaming platform provider. As of the date of this filing, the transaction has not been completed. As of December 31, 2025 the company has decided not to proceed with the acquisition of Lucky Bet following further due diligence. Further the company recorded a loss of the nonrefundable deposit as a result.
	·	In August 2025, we entered into an Equity Backstop agreement with LDA Capital Group allowing draw-down of up to $25 million, with an ability to extend the draw-down up to $50 million based on completion of a Registration Statement and trade volume metrics.
	·	Effective March 1, 2026, the Company entered into a Joint Venture and License Agreement ("Agreement") with AIC Enterprises, LLC, a limited liability company domiciled in Belize ("AiC"), to create a joint venture utilizing an existing online, crypto gaming platform of AiC, called appleicasino.com ("Platform"). The Platform recently commenced operations in a limited number of countries, and as such, the Company cannot predict the success of the Platform. Mr. Marino Sussich, our director and an affiliate of our largest shareholder, owns 45% of the equity of AIC.

Our address is 100 Spectrum Center Dr., Suite 900, Irvine, CA 92618, and our phone number is (949) 247-4210. In addition, as mentioned, we have two websites (which do not form a part of these filings): appleisports.com in the U.S. and www.appleisports.com.au in Australia.

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Our corporate structure is depicted below:

Apple iSports Corporate Structure as of December 31, 2025

AiS Australia was closed in December 2025, with operations and financial controls moving to the USA.

Results of Operations (Audited) for the Fiscal Year Ended December 31, 2025 Compared to the Fiscal Year Ended December 31, 2024.

Results of Operations

Revenues

During the fiscal years ended December 31, 2025 and 2024, the Company had no revenues.

Operating Expenses

During the same periods, the Company had total operating expenses of $6,592,032 and $3,419,426, respectively. During the year ended December 31, 2025, operating expenses consisted of corporate expenses of $285,206, consulting and professional fees of $5,774,130, and selling, general, and administrative expenses of $532,696. During the year ended December 31, 2024, operating expenses consisted of corporate expenses of $458,366, consulting and professional fees of $2,237,043, and selling, general and administrative expenses of $724,017. The 91% increase in operating expenses for the current year over the prior year is attributed to an increase of $4,335,480 from the stock options which were granted during the year, $2,566,695 related to the US plan and $1,768,785 related to the Australian Plan. See Note 10 of the audited financial statements included herein for additional detail on the stock incentive plan. In addition to the increase related to stock options, there was an increase of $238,600 related to the write off of deposits. The Company wrote off $199,900 related to the Deposit for potential Americrew deal and $38,700 (60,000 AUD) for the Booki deal. This was offset by a decrease in marketing-related expenses during the years ended December 31, 2025, until the Company and its platform move closer to the "Go Live" date.

Other Income (Expenses)

During the years ended December 31, 2025 and 2024, we had $47,405 and $92,194, respectively, in interest expense attributable to related party debt. The decrease in interest expense, net for the current year over the prior year, was due to the conversion of the related party Cres loan on January 9, 2025, which resulted in a reduction of interest expense for year ended December 31, 2025.

During the years ended December 31, 2025 and 2024, we had $0 and $659,663 related to debt forgiveness. This was related to the Company rescinding a third-party intellectual property acquisition and reversal of AUD $1,000,000 of accounts payable and recognized forgiveness of debt income of AUD $1,000,000 ($659,663) during the year ended December 31, 2024.

During the years ended December 31, 2025 and 2024, we had $6,407,709 and $2,821,336, respectively in losses from operations for the reasons discussed above.

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Liquidity and Capital Resources

As of December 31, 2025, and 2024, the Company had a working capital deficit of $5,900,109 and $6,539,584, respectively. The decrease in the working capital deficit is primarily due to an increase in accounts payable and accrued expenses during the year ended December 31, 2025. The Company received funds from private placements (See Net Cash Provided by Financing Activities below) during the year ended December 31, 2024, which caused the slight reduction of the deficit.

The Company cannot provide assurance that it will continue to satisfy its cash requirements for at least the next twelve months. The following is a summary of the Company's cash flows provided by (used in) operating, investing, and financing activities for the years ended December 31, 2025, and 2024:

		December 31,				December 31,
		2025				2024
Net Cash Used in Operating Activities		$	(1,664,244	)		$	(2,356,400	)
Net Cash Used in Investing Activities			(600	)			(80,000	)
Net Cash Provided by Financing Activities			1,678,582				2,508,689
Effect of changes in exchange rate on cash and cash equivalents			33				(30,795	)
Net Change in Cash		$	13,771			$	41,494

Operating Activities

During the year ended December 31, 2025, the Company incurred a net loss of $6,407,709, which after adjusting for decrease goods and services tax receivable of $43,715, along with increases in accounts payable and accrued expenses of $327,492, accounts payable and accrued expenses to related parties $355,287, accrued interest income of $4,000, prepaid other assets of $55, accrued interest expense $2,997 and offset by a decrease in deposits of $78,088, accrued payroll of $279,541, accrued interest to related party of $47,048, along with foreign exchange gain of $180,128, and stock based compensation expense of $4,352,562 resulted in net cash of $(1,664,244) being used in operating activities during the period. By comparison, during the year ended December 31, 2024, the Company incurred a net loss of $2,821,336 which after adjusting for increases in goods and services tax receivable of $8,853, along with an increase in accounts payable and accrued expenses of $393,447, accounts payable and accrued expenses to related parties 458,525, accrued payroll of $304,187, accrued interest to related party of $87,629, accrued interest income of $2,998, prepaid and other assets of $4,844, and deposits of $87,629 along with foreign exchange gain of $30,621, forgiveness of debt of $659,663 resulted in net cash of $(2,356,400). The year-over-year change in operating activities was driven by a decrease in accrued consulting expenses resulting from Jeremy Samuel's departure. Additionally, there was an increase in liabilities related to common stock that were subscribed but not issued during the year. This was offset by forgiveness of debt for intellectual property from the prior year, as well as a decrease in Deposits from the prior year related to the write-off on nonrefundable deposits from the potential Americrew and Booki deals.

Investing Activities

During the year ended December 31, 2025, the Company had a receivable of $600 for proceeds owed by a vendor. By comparison, in the year ended December 31, 2024, the Company loaned $80,000 to SeaPort, Inc., an unaffiliated third party.

Financing Activities

During the year ended December 31, 2025, the Company received $1,678,582 from financing activities, consisting of $206,782 of proceeds from loan payable, $1,464,804 of proceeds from related party loans, $216,508 of payments on related party loans, $278,504 of proceeds from common stock issuances, and payment for equity issuance cost related to equity contract of $55,000. By comparison, during the year ended December 31, 2024, the Company received $2,508,689 from financing activities, consisting of $1,163,789 in loans from related parties and $1,344,900 from stock issuances. The significant year-over-year changes in finance activities is primarily are primarily due to the proceeds from the issuance of shares of common stock and, to a lesser extent, related party loans.

The Company is dependent upon the receipt of capital investment or other financing to fund its ongoing operations and to execute its business plan of seeking a combination with a private operating company. In addition, the Company is dependent upon certain related parties to provide continued funding and capital resources. No assurances can be given that the Company will be successful in locating or negotiating with any target company or that the related parties will continue to fund the Company's working capital needs. As a result, there is substantial doubt about the Company's ability to continue as a going concern.

Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company's financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources that is material to investors.

Contractual Obligations

None.

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Critical Accounting Estimates and Policies

The preparation of financial statements in conformity with generally accepted accounting principles of the United States ("GAAP") requires estimates and assumptions that affect the reported amounts of assets and liabilities, revenues, and expenses in the financial statements and accompanying notes. Critical accounting estimates are those estimates made in accordance with GAAP that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on the financial condition or results of operations of the Company. We also have other key accounting policies, which involve the use of estimates, judgments, and assumptions that are significant to understanding our results, which are found in Note 3 - Summary of Significant Accounting Policies and Basis of Presentation of the accompanying consolidated financial statements. Although we believe that our estimates, assumptions, and judgments are reasonable, they are based upon information presently available. Actual results may differ significantly from these estimates under different assumptions, judgments, or conditions.

Please refer to Note 3 to the Financial Statements included elsewhere in this Report for further discussion on our accounting Policies.

Implementation of our Business Plan.

To fully implement our business plan, we will require a total of $5,500,000 in public or private funds to be allocated over next 12 months. The estimated cost breakdown is as follows:

Amount ($)			Expenditure
800,000			Apple iSports 24/7 branded app in conjunction with potential acquisitions
1,500,000			Marketing and Public Relations
1,500,000			Acquisitions
700,000			Legal and regulatory
1,000,000			Administration and compensation
5,500,000			Total

Legal and regulatoryincludes legal and audit fees in connection with the Company's filings with the Securities and Exchange Commission, as well as supporting applications for ADW and sports betting licenses in various U.S. states.

Administration and compensationinclude administrative overhead and officers' salaries.

If we are unable to raise the entirety of the required funds, $5,500,000, we will have to curtail our operations. If we receive $1,000,000 in funding, we will allocate such funds as follows;

	·	$550,000 for the completion and rollout of our Live Content Sports Streaming app, which will enable us to deliver the app in U.S..
	·	$100,000 for professional and advisory fees,
	·	$250,000 for marketing and public relations, and
	·	$100,000for salaries.
	·	$1,000,000 - Total

We also expect to generate advertising revenue from the rollout of our Live Content Sports Streaming. At this time, we cannot predict the level of income from the projected revenue sources.

Thereafter, as more cash becomes available, we plan to prioritize our operations in the following order:

·	24/7 Sports rollout in the U.S..
·	Racing rollout in North Dakota and related states,
·	Marketing relating to racing,
·	Sports betting rollout in initial U.S. states, and
·	Expansion of ADW (racing) and sports betting to additional states.
·	Expect to penetrate tribal nations in the USA with the Mobile II product rollout.