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

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

You should read the following discussion and analysis of our financial condition and results of operations together with our condensed financial statements and related notes appearing in this Quarterly Report on Form 10-Q. This discussion and other parts of this Quarterly Report contain forward-looking statements that involve risks and uncertainties, such as statements of our plans, objectives, expectations and intentions. As a result of many factors, including those factors set forth in the "Risk Factors" section of this Quarterly Report, our actual results could differ materially from the results described in, or implied by, the forward-looking statements contained in the following discussion and analysis.

Overview

Mobile Global Esports Inc. ("MOGO Inc" or "MGAM") was incorporated on March 11, 2021 under the laws of the State of Delaware. The Company was originally named Elite Esports, Inc. but changed its name to Mobile Global Esports Inc. on April 21, 2021. During July 2022, MOGO Esports Private Limited ("MOGO Pvt Ltd") was established and incorporated in India. During June 2025, MOGO Pvt LTD was determined to have no value and was removed from MOGO Inc.'s records. Also, during June 2025, MGAM announced the beta launch of its flagship product, Dominus Sports, integrated with PUHZL, MGAM's proprietary artificial intelligence platform. Dominus Baseball is the first product that has been developed by MGAM. Dominus introduces true-to-life simulation gameplay by turning live sports data into full 9-inning box scores using MGAM's proprietary algorithms. The platform supports collaborative, role-based team ownership, enabling groups of users to manage teams as owners, scouts, coordinators, and general managers in a dynamic, strategic environment. PUHZL uses a combination of deterministic modeling and predictive modeling to drive in-app conversions, delivering personalized suggestions, adaptive chat experiences, and intelligent alerts that evolve with each user's behavior. In October 2025, MGAM purchased Reality Sports Online ("RSO"), which is a premier dynasty-style Football fantasy sports platform built around real-world contract negotiations, salary-cap management, and multi-season franchise control. This acquisition unites RSO's long-term team-management experience with Dominus Baseball's real-time predictive gameplay, creating a fully integrated fantasy sports ecosystem that bridges instant competition and strategic ownership.

Components of Statements of Operations

Revenue and Cost of Revenue

During 2025, the Company established a beta league for fantasy baseball utilizing its Dominus Sports product, which provides customers the opportunity to create and own a team with three different tier pricing options. Ownership fees paid provide the customer with ownership rights over a five-year period. Customers also have the ability to buy additional micro transactions, which provide various additional rights or improvements to their teams. Team ownership fees are generally recognized over the five-year ownership period and micro transactions are generally recognized as revenue when billed. As of September 30, 2025, the amount of deferred revenue from ownership fees was approximately $10,000. Revenue and cost of revenue for the three and nine months ended September 30, 2025 from the beta league was immaterial.

Selling, General and Administrative Expenses

General and administrative expenses consist principally of consultant costs in the U.S., public filing fees, travel expenses, and professional fees.

Critical Accounting Estimates

We discussed our accounting policies and significant assumptions used in our estimates in Note 2 of our audited financial statements included in our 2024 Form 10K, and that disclosure should be read in conjunction with the Quarterly Report on Form 10-Q. There have been no material changes during the three and nine months ended September 30, 2025 to our critical accounting policies, significant judgments and estimates disclosed in our Form 10K.

Results of Operations

Three and Nine months Ended September 30, 2025 compared with the Three and Nine months Ended September 30, 2024

The following table summarizes the results of our operations for the three and nine months ended September 30, 2025 and 2024, together with the changes in those items in dollars and as a percentage:

MOBILE GLOBAL ESPORTS INC.
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited)

For the three and nine months ended September 30, 2025 and 2024

		Nine Months				Nine Months												Three Months				Three Months
		Ended				Ended												Ended				Ended
		September 30, 2025				September 30, 2024				% Change				% Change				September 30, 2025				September 30, 2024				% Change				% Change
Revenue		$	57			$	-			$	57				*			$	57			$	-			$	57				*
Operating expenses:
Research and development expenses			-				-												-				-
General and administrative			1,630,673				1,222,917				407,756				33	%			858,079				404,295				453,784				112	%
Total operating expenses			1,630,673				1,222,917				407,756				33	%			858,079				404,295				453,784				112	%
Loss from operations			(1,630,616	)			(1,222,917	)			(407,699	)			33	%			(858,022	)			(404,295	)			(453,727	)			112	%
Interest income			27				200												-				22
Interest expense			(12,834	)			-												(11,008	)			-
Change in fair value of convertible notes payable			(28,245	)			-												(28,245	)			-
Gain on sale of property and equipment			-				-												-				-
Other income (expense), net			(41,052	)			200				(41,252	)			**				(39,253	)			22				(39,275	)			**
Loss from continuing operations			(1,671,668	)			(1,222,717	)			(448,951	)			37	%			(897,275	)			(404,273	)			(493,002	)			122	%
Income taxes			-				-												-				-
Loss from continuing operations			(1,671,668	)		$	(1,222,717	)											(897,275	)		$	(404,273	)
Discontinued operations (Note 11)
Loss from operations of discontinued MOGO Pvt Ltd			(122,564	)			(496,496	)											(51,197	)			(199,488	)
Gain on classification as held for sale			12,866				-												-				-
Income tax benefit			-				-												-				-
Loss on discontinued operations			(109,698	)			(496,496	)			386,798				-78	%			(51,197	)			(199,488	)			148,291				-74	%
Net loss		$	(1,781,366	)		$	(1,719,213	)		$	(62,153	)			4	%		$	(948,472	)		$	(603,761	)		$	(344,711	)			57	%

*	Not meaningful

**	Significantly more than 500%

General and Administrative Expenses

General and administrative expenses were approximately $858,000 for the three months ended September 30, 2025, compared with $404,000 for the three months ended September 30, 2024. The increase in general and administrative expenses was primarily driven by an increase of approximately $525,000 in consulting expense and $11,000 in travel and marketing expense. This increase was offset by decreases of $24,000 in legal and accounting fees and $70,000 in board fees and US payroll.

General and administrative expenses were approximately $1,631,000 for the nine months ended September 30, 2025, compared with $1,223,000 for the nine months ended September 30, 2024. The increase in general and administrative expenses was primarily driven by an increase of approximately $759,000 in consulting expense, $36,000 in marketing expense and $10,000 in travel expense. This increase was offset by decreases of $241,000 in legal, accounting and professional fees, $162,000 in board fees and US payroll and $21,000 in insurance expense.

Liquidity and Capital Resources

As of September 30, 2025 and December 31, 2024, we had cash of approximately $810,000 and $929,000, respectively.

We have financed our operations through the issuance of common stock and common stock with warrants. In July 2022, we issued 1,725,000 shares of common stock for total gross proceeds of $6,900,000 through an initial public offering ("IPO"). We received net proceeds after commissions, fees and expenses of approximately $5,465,000. In September 2022, we issued 1,886,793 shares of common stock along with 1,886,793 warrants, for total gross proceeds of $5,000,001 through a private equity placement ("PIPE"). We received net proceeds after commissions, fees and expenses of approximately $4,422,000. In 2025 the Company issued 500,000 shares of common stock with warrants to purchase up to 500,000 shares of common stock ("2025 Warrants") at an exercise price of $0.26 per share through a private stock offering. The total purchase price was $0.25 per share and warrant for total gross proceeds of $125,000. In 2025, we also issued several note payable agreements totaling $125,000 and issued several convertible promissory notes for total gross proceeds of $551,500.

Funding Requirements

We believe we may need to raise additional funding to meet our cash, operational and liquidity requirements for at least 12 months after the date of this quarterly report.

We cannot specify with certainty all of the particular uses for the net proceeds to us from the IPO, PIPE and other financings. Accordingly, our management will have broad discretion in the application of these proceeds.

We intend to use the net proceeds from the IPO, PIPE and the other financings for operating expenses, marketing, event expenses, streaming, retention of additional staff in the United States, working capital and general corporate purposes, including perhaps acquisitions of game licenses, technology platform agreements, data development and strategic partnerships. Investors are cautioned, however, that expenditures may vary substantially from these uses. Investors will be relying on the judgment of our management, who will have broad discretion regarding the application of the proceeds of the IPO and the PIPE. The amounts and timing of our actual expenditures will depend upon numerous factors, including the amount of cash generated by our operations and the amount of competition we face and other operational factors. We may find it necessary or advisable to use portions of the proceeds from the IPO, PIPE and other financings for other purposes.

Our future funding requirements will depend on many factors, including:

●

Failure of future market acceptance of our mobile esports products and services;

●

Increased levels of competition;

●

Changes in political, economic or regulatory conditions generally and in the markets in which we operate;

●

Our ability to retain and attract senior management and other key employees;

●

Our ability to protect our trade secrets or other proprietary rights, operate without infringing upon the proprietary rights of others and prevent others from infringing on the proprietary rights of the Company; and

●

Other risks, including those described in the "Risk Factors" discussion.

See "Risk Factors" for additional risks associated with our substantial capital requirements.

Cash Flows

The following table summarizes our sources and uses of cash:

		Nine months Ended
		September 30,
		2025				2024
Net cash provided by (used in):
Operating activities		$	(804,288	)		$	(1,750,597	)
Investing activities			(110,000	)			(65,557	)
Financing activities			796,910				(65,040	)
Effect of exchange rate changes on cash			(1,160	)			(2,655	)
Net decrease in cash		$	(118,538	)		$	(1,883,849	)

Operating Activities

Net cash used in operating activities decreased by approximately $946,000 for the nine months ended September 30, 2025 compared with the nine months ended September 30, 2024. The decrease was primarily due to a $28,000 increase in the change in fair value of convertible notes payable; a $689,000 increase in non-cash expenses for stock and warrants issued for services and a $335,000 change in operating assets and liabilities, offset by an increase in net loss of approximately $62,000 and a $55,000 decrease in depreciation expense and amortization of right of use assets.

Investing Activities

Net cash used in investing activities increased by approximately $44,000 for the nine months ended September 30, 2025 compared with the nine months ended September 30, 2024. This increase was primarily due to a $110,000 increase in software costs, offset by a $66,000 decrease in property and equipment purchases.

Financing activities

Net cash provided by financing activities increased by approximately $862,000 for the nine months ended September 30, 2025 compared with the nine months ended September 30, 2024. The change was due to an increase of financing raised from the issuance of convertible notes payable, notes payable and common stock with warrants totaling $801,500, a decrease in payments on the note payable of $65,000 and an increase in stock issuance costs of $5,000.

JOBS Act

As an "emerging growth company" under the Jumpstart Our Business Startups Act of 2012, as amended, or the JOBS Act, we can take advantage of an extended transition period for complying with new or revised accounting standards. This allows an emerging growth company to delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have irrevocably elected to "opt out" of this provision and, as a result, we will comply with new or revised accounting standards when they are required to be adopted by public companies that are not emerging growth companies.

Subject to certain conditions, as an emerging growth company, we rely on certain of these exemptions, including without limitation:

●

reduced disclosure about our executive compensation arrangements;

●

no advisory votes on executive compensation or golden parachute arrangements; and

●

exemption from the auditor attestation requirement in the assessment of our internal control over financial reporting.

We may take advantage of these exemptions for up to five years or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company on the date that is the earliest of (i) the last day of the fiscal year in which we have total annual gross revenue of $1.07 billion or more; (ii) the last day of 2027; (iii) the date on which we have issued more than $1.0 billion in nonconvertible debt during the previous three years; or (iv) the date on which we are deemed to be a large accelerated filer under the rules of the SEC. We may choose to take advantage of some but not all of these exemptions. Accordingly, the information contained herein may be different from the information you receive from other public companies in which you hold stock.

Off-Balance Sheet Arrangements

We did not have during the periods presented, and we do not currently have, any off-balance sheet arrangements, as defined in the rules and regulations of the SEC.