10-Q: Athena Bitcoin Global Reports Q3 Loss Amid Revenue Decline

Sentiment:

Quarterly Report 13 November 2025 4:16 PM

Athena Bitcoin Global reported a net loss of $2.5 million for Q3 2025, driven by a 17% revenue decrease and a $4.6 million loss on debt extinguishment.

Delay expectedThe proposed Reverse Stock Split, approved by majority stockholders on July 7, 2025, has not been implemented to date, and the Reverse Stock Amendment has not been filed.The trial for the Keon Jackson class action lawsuit is scheduled to commence on January 20, 2026, indicating a prolonged legal process.The trial for the Arley Lozano-Jaramillo legal proceeding is scheduled for March 2, 2026.Zamareeh Odoms still has at least a year to file any judicial claims against Athena, as the statute of limitation for a tort action in Florida is 2 years if not properly tolled.

Capital raiseThe company may attempt to raise capital by selling shares of common stock, possibly at a discount to market in the future.The Board of Directors has the authority to issue authorized but unissued shares of common stock, preferred stock, or warrants to purchase such shares, potentially as non-cash consideration to satisfy obligations, which could dilute existing shareholders.The convertible debenture with KGPLA, with a principal amount of $3.0 million and a maturity date extended to January 31, 2026, is convertible into common stock at a specified price or discount, representing a potential future equity issuance and dilution.

Worse than expectedThe company reported a net loss of $2.5 million for the three months ended September 30, 2025, a significant decline from a net income of $2.3 million in the prior year period.Revenue decreased by 17% for the three months and 13% for the nine months ended September 30, 2025, indicating a substantial downturn in core business performance.Gross profit decreased by 11% for the three months and 27% for the nine months ended September 30, 2025, reflecting reduced profitability.A significant non-recurring loss of $4.6 million on extinguishment of debt negatively impacted the financial results.Cash provided by operating activities decreased by over 58% for the nine-month period, signaling reduced operational cash generation.The working capital deficit increased from $2.5 million to $5.9 million, indicating a worsening short-term liquidity position.

Summary

A net loss of $2.5 million was reported for the three months ended September 30, 2025, a significant decrease from a net income of $2.3 million in the prior year period.
Revenue decreased by 17% to $57.4 million for the three months ended September 30, 2025, compared to $69.4 million for the same period in 2024, attributed to market uncertainty and decreased sales prices.
For the nine months ended September 30, 2025, revenue decreased by 13% to $192.9 million from $221.7 million in the prior year.
Gross profit declined by 11% to $7.2 million for the three months and by 27% to $23.1 million for the nine months ended September 30, 2025.
A $4.6 million loss on extinguishment of debt was recorded, along with $681 thousand of unamortized imputed interest write-off, related to the termination of agreements with Taproot Parties.
Cash provided by operating activities significantly decreased to $7.7 million for the nine months ended September 30, 2025, from $18.4 million in the comparable 2024 period.
The working capital deficit increased from $2.5 million as of December 31, 2024, to $5.9 million as of September 30, 2025.
Total indebtedness, excluding lease liabilities, stood at $20.685 million as of September 30, 2025.
The number of Athena Bitcoin ATMs increased by 4% from 3,111 to 3,225 between December 31, 2024, and September 30, 2025.
The median ATM transaction size for Bitcoin decreased by 33% from $180 to $120, while the number of transactions increased by 33% from 128,056 to 170,309 for the nine months ended September 30, 2025, compared to 2024.
Median OTC transaction size decreased by 67% from $48,600 to $16,000, but the number of OTC transactions increased by 292% from 39 to 153 for the nine months ended September 30, 2025, compared to 2024.
Material weaknesses in internal control over financial reporting were identified, leading to a conclusion that disclosure controls and procedures were not effective.
El Salvador's Bitcoin Law was modified on January 29, 2025, making Bitcoin usage entirely voluntary and no longer legal tender, though the company believes demand will continue.

Sentiment

Score: 3

Explanation: The company reported a net loss for the quarter, a substantial decline in revenue and gross profit, and a significant one-time loss on debt extinguishment. Cash flow from operations also decreased considerably. These financial underperformances are compounded by identified material weaknesses in internal controls and a multitude of ongoing legal proceedings and regulatory scrutiny. While there is some operational growth in ATM count and the affiliates program, these positives are overshadowed by the severe financial, governance, and legal challenges, as well as regulatory uncertainty in key markets like El Salvador. The stock's penny stock status and liquidity risks further contribute to a highly precarious outlook.

Positives

The number of Athena Bitcoin ATMs increased by 4% to 3,225 from December 31, 2024, to September 30, 2025.
The number of Bitcoin ATM transactions increased by 33% for the nine months ended September 30, 2025.
OTC transactions saw a significant increase of 292% for the nine months ended September 30, 2025.
The company successfully settled and terminated outstanding obligations with Taproot Parties for $9.0 million, resolving prior equipment financing and other agreements.
The adoption of ASU 2023-08 for measuring crypto assets at fair value had no material impact on financial statements due to the company's short holding periods for crypto assets.
The company is self-funded and generates sufficient cash from operations to fund its global activities.

Negatives

A net loss of $2.5 million was reported for the three months ended September 30, 2025, a significant reversal from a net income of $2.3 million in the prior year.
Revenue decreased by 17% for the three months and 13% for the nine months ended September 30, 2025, primarily due to market uncertainty and a decrease in sales prices per transaction.
Gross profit decreased by 11% for the three months and 27% for the nine months ended September 30, 2025.
A substantial non-recurring loss of $4.6 million was recorded on the extinguishment of debt, along with a $681 thousand write-off of unamortized imputed interest.
Cash provided by operating activities decreased significantly from $18.4 million in 2024 to $7.7 million in 2025 for the nine-month period.
The working capital deficit increased from $2.5 million to $5.9 million, indicating a deteriorating short-term financial position.
The median ATM transaction size for Bitcoin decreased by 33%, and the median OTC transaction size decreased by 67%.
General and administrative expenses increased by 20% for the quarter and 32% for the nine months, driven by additional personnel, legal fees, insurance, and public company compliance costs.
Technology and development expenses increased by 15% for the quarter and 42% for the nine months.
Material weaknesses were identified in internal control over financial reporting, leading to a conclusion that disclosure controls and procedures were not effective.
Multiple ongoing legal proceedings, including class action allegations related to elder financial scams and consumer fraud, and a copyright infringement lawsuit, pose significant financial and reputational risks.
El Salvador's Bitcoin Law was modified, making Bitcoin usage voluntary and no longer legal tender, which could impact operations despite the company's assessment.
The company carries a significant level of indebtedness totaling $20.685 million (excluding lease liabilities) with restrictive covenants.
Cash losses for cash in transit amounted to $1.1 million for the nine months ended September 30, 2025, and $2.1 million of uncollectible outstanding cash in transit was written off.

Risks

Revenue is heavily dependent on crypto transaction volumes and the volatile prices of crypto assets, with declines in prices or volume potentially harming results and investor confidence.
Forecasting demand, volume, and performance is difficult due to operating in a new, rapidly evolving crypto product market.
Significant indebtedness ($20.685 million excluding lease liabilities) is secured by most assets, with restrictive covenants limiting financial flexibility and potential difficulty in raising additional capital.
Cash and crypto assets face risks of theft or loss, especially from compromised private keys, with limited insurance coverage for such events.
Operational disruptions from failures in ATMs, software, IT, or blockchain networks could reduce users, harm the brand, and negatively affect results.
International operations, particularly in El Salvador, are subject to political or economic instability, enforcement issues, and restrictions on asset ownership, with the company's role in El Salvador's Bitcoin Law carrying specific risks.
Weak global or regional economies and negative sentiment toward crypto could reduce demand for services.
Inability to protect intellectual property or defend against infringement claims could disrupt operations.
The future development and acceptance of Bitcoin, crypto assets, and blockchain protocols are uncertain; if they stall, the business could suffer, and stablecoins may not retain value.
Blockchain forks or integration challenges could create instability and harm operations.
High miner or validator fees could increase costs and reduce margins.
The rapidly evolving regulatory environment for crypto assets, including potential reclassification of assets as securities, forfeiture actions, or banking restrictions, could harm the business.
Failure to secure required licenses or comply with AML, privacy, and other laws could halt operations or result in penalties.
Government intervention could restrict or ban crypto use, limiting the ability to operate.
Loss of senior management or inability to attract talent could hurt performance.
Employee or service provider errors or misconduct could damage financials and reputation.
Interests in other crypto projects by insiders could create conflicts affecting the business.
Provisions in the company's charter, bylaws, and Nevada law may deter takeovers, affecting stock value.
The stock lacks a trading market and may face volatility unrelated to performance, causing investor difficulty in valuation.
Founders and major shareholders hold significant control, influencing shareholder decisions.
Conversion of debentures and future equity raises will dilute shareholders.
Stock prices may remain volatile and decline significantly.
The proposed reverse stock split may not satisfy Nasdaq listing requirements, could reduce liquidity, and may not result in lasting higher prices or attract investors.
The company's securities are considered 'Penny Stocks,' which may make them less desirable or accessible by investors.
Significant liquidity risk is associated with an investment in the common stock.
Resale of restricted and unregistered securities could negatively affect the company and its common stock.
Adverse macroeconomic conditions, including inflation, recession, and changes to fiscal/monetary policy, could materially adversely affect operations.
Regulatory developments and government action on climate change issues may drive medium-to-long term increases in operational costs.
Security threats, including cybersecurity threats, could adversely affect the business.

Future Outlook

The company anticipates increased technology and development expenses to support expanding activities and commercialization of new products and services, including additional personnel and infrastructure. General and administrative expenses are also expected to fluctuate and increase due to public company costs, personnel, legal, accounting, and compliance. Sales and marketing expenses are projected to fluctuate to support activities and potential commercialization. Despite changes to El Salvador's Bitcoin Law making Bitcoin usage voluntary, the company believes demand for Bitcoin transactions will continue, driven by organic consumer choice, and that the government's reduced involvement in Chivo Wallet may create opportunities for private companies. A near-term milestone for the Affiliates Program is to onboard additional ATM operators in key markets throughout 2025 to increase transaction volume and expand brand presence without significant capital expenditure, with a goal to have a certain number of affiliate-operated ATMs live by year-end. Material cash requirements of approximately $16.6 million for the remainder of 2025 and $37.7 million for 2026-2029 are expected to be met through ongoing operations, though additional funds may be needed for growth initiatives. The company may use non-cash consideration, such as restricted shares or warrants, to satisfy obligations, which could dilute existing shareholders, and may also raise capital by selling common stock, potentially at a discount. The proposed Reverse Stock Split has not yet been implemented and may be abandoned or adjusted. The company intends to vigorously defend against ongoing legal claims and litigation matters.

Management Comments

"We believe that the uncertainty in the market was triggered by geopolitical and economic changes triggered by new tariffs, fears of inflation and employment instability in the U.S."
"We believe demand for Bitcoin transactions will continue to be driven by individuals who choose to use Bitcoin."
"We believe this development [El Salvador government stepping back from Chivo Wallet] may open opportunities for private companies (including the Company) to fill any service gaps left by the governments reduced role."
"We have assessed the impact of the legislative changes and the Chivo transition and do not foresee a negative impact on our business, in part because our existing ATM operations and customer base in El Salvador are expected to continue without disruption."
"We believe we have strong arguments against these open claims and litigation matters and plan to defend ourselves vigorously in these matters."
"Management has concluded that these material weaknesses arose because, the Company did not have the necessary business processes, personnel and related internal controls necessary to satisfy the accounting and financial reporting requirements of a public company."
"Management intends to continue to take steps to remediate the material weaknesses described above through hiring additional qualified accounting and financial reporting personnel, further enhancing their accounting processes and risk assessment, and by designing, implementing and monitoring the respective controls."
"Management will not be able to fully remediate these material weaknesses until these steps have been completed and the controls have been operating effectively for a sufficient period of time."
"Notwithstanding the above identified material weaknesses, management believes the Consolidated Financial Statements as included in this Quarterly Report on Form 10-Q fairly represent, in all material respects, the Company's financial condition, results of operations and cash flows as of and for the periods presented in accordance with generally accepted accounting principles in the United States."

Industry Context

The crypto economy is characterized by rapid evolution and significant price volatility, which directly impacts transaction volumes for companies like Athena Bitcoin Global. Recent bankruptcies of major crypto market participants (e.g., FTX, Celsius, Voyager) have eroded investor confidence and intensified regulatory scrutiny across the industry. Governments globally are actively developing and implementing new regulatory frameworks for cryptocurrencies, leading to uncertainty and potential new laws, such as California's Digital Financial Assets Law and investigations by states like Iowa into crypto ATM operations. There is increasing public and media focus on fees charged by crypto ATM operators and concerns about their potential use in scams, particularly elder financial exploitation. The industry is also grappling with challenges related to data protection, cybersecurity, privacy, and anti-money laundering compliance. While Bitcoin and other crypto assets are still in early stages of broader adoption as a medium of exchange, a significant portion of demand continues to be driven by speculators. The role and regulation of stablecoins, a substantial part of the crypto market, also remain under scrutiny.

Comparison to Industry Standards

The filing does not provide specific comparable company data or global benchmarks to directly assess its results against industry standards.
The company's average markup for Bitcoin transactions at ATMs, ranging from 13% to 28% (average 23%), is noted in the context of media reports alleging higher fees compared to traditional financial institutions, indicating a general industry perception challenge.
Athena Bitcoin Global's use of BitGo Trust Company, Inc. as a qualified custodian for its digital assets, backed by insurance policies from Lloyds of London (crime coverage up to $5 million, specie coverage up to $250 million), suggests a higher standard of security and risk mitigation compared to many unregulated or less-established entities in the crypto ATM sector.
The company acknowledges that 'many of our competitors are unlicensed, unregulated, operate without supervision by any governmental authorities,' implying Athena operates with a higher degree of regulatory compliance and structure.

Corporate Governance

Change Type	Description	Effective Date	Impact Assessment
Internal Control Weaknesses	Identified material weaknesses in internal control over financial reporting, including a lack of formalized system for risk assessment, account reconciliation, control design/implementation/monitoring, and insufficient general IT controls over access, segregation of duties, security, and change management.	2025-09-30	Significantly impairs the ability to prevent or detect material misstatements in financial statements and led to ineffective disclosure controls.
Disclosure Controls Ineffective	Principal executive officer and principal financial officer concluded that disclosure controls and procedures were not effective as of September 30, 2025, due to the identified material weaknesses.	2025-09-30	Indicates a heightened risk of material information not being recorded, processed, summarized, or reported timely and accurately.
Equity Compensation Plan Approval	The Board of Directors and majority shareholders approved the 2025 Equity Compensation Plan, authorizing the granting of up to 409,500,955 shares of common stock for awards.	2025-07-07	Provides a framework for future equity-based compensation, potentially leading to future dilution for existing shareholders.
Reverse Stock Split Approval	Majority stockholders approved a one-for-three hundred reverse stock split, following the Board's recommendation, though it has not yet been implemented.	2025-07-07	Aims to increase the market price per share to meet Nasdaq listing requirements, but carries risks of reduced liquidity and no sustained price increase.
Indemnification Provisions	Second Amended and Restated Articles of Incorporation provide for indemnification of officers and directors to the fullest extent permitted by Nevada law.	N/A	May result in substantial expenditures by the company and could discourage lawsuits against directors and officers, potentially hurting stockholder interests.
Preferred Stock Authorization	The board of directors is authorized to issue shares of preferred stock in one or more series without stockholder approval, with various voting powers, preferences, and rights.	N/A	Could diminish the rights of common stockholders, cause substantial dilution, and make a change of control more difficult.
Anti-takeover Provisions	Corporate governance documents and Nevada law contain provisions that may discourage, delay, or prevent a merger, acquisition, or other change in control.	N/A	Could limit the opportunity for shareholders to receive a premium for their shares and affect the price investors are willing to pay for common stock.
Lack of Independent Committees	The company is not currently required to comply with certain corporate governance provisions, such as having an independent audit or compensation committee, and has not yet adopted these measures.	N/A	May leave stockholders without protections against interested director transactions and conflicts of interest, potentially making the company less attractive to investors.

Legal Proceedings

**Arley Lozano-Jaramillo (Lozano) vs. Company**: Complaint filed October 9, 2023, alleging breach of contract, promissory estoppel, unjust enrichment, fraud, and conversion related to an unfinalized acquisition of XPay Assets. Lozano seeks $1.4 million and 270,000,000 shares of common stock (valued at $27.0 million). The Company disputes allegations and filed a counter-complaint. Trial scheduled for March 2, 2026.
**Digital Access, LLC vs. Athena**: Complaint filed June 21, 2024, alleging tortious interference, conversion, and trespass. A mutually acceptable settlement was reached, and the case was dismissed on March 25, 2025.
**Keon Jackson (Jackson) vs. Athena**: Class Action Complaint filed August 20, 2024, alleging unwanted telemarketing text messages. Class certification was granted on June 18, 2025. Summary judgment was granted in part for Jackson under the Florida Telephone Solicitation Act (FTSA) for 4,512 instances ($500 penalty per instance). Trial on remaining issues is scheduled for January 20, 2026.
**S.M. vs. Athena, Genesis Coin, Inc., and others**: Class action allegations filed September 9, 2024, alleging negligence and Ohio Products Liability Act violations due to elder financial scams involving cryptocurrency kiosks. Seeks undetermined compensation (not exceeding $5.0 million) and injunctive relief. A motion to dismiss is pending.
**Karen Carew (Carew) vs. Athena, CEO, and others**: Class action allegations filed November 25, 2024, alleging negligence and violations of various New Jersey statutes (possession of stolen property, Racketeer Influenced and Corrupt Organizations, consumer fraud) related to elder scams at Bitcoin ATMs. Seeks undetermined compensation (not exceeding $5.0 million) and injunctive relief. Class action allegations were removed, making Carew a sole plaintiff. A motion to dismiss is pending.
**Girma Yilma (Yilma) vs. Athena, and others**: Class action allegations filed January 21, 2025, alleging negligence and violations of various Colorado statutes (consumer protection, civil theft, unjust enrichment, negligent design) related to elder scams at Bitcoin ATMs. Seeks undetermined compensation (not exceeding $5.0 million) and injunctive relief. The case was referred to obligatory arbitration on August 13, 2025.
**Zamareeh Odoms (Odoms) vs. Athena**: An extrajudicial claim for $500 thousand was sent on January 31, 2025, alleging lack of proper due diligence in recruiting/supervising an employee causing personal damages. The company assesses no liability as the individual involved was not an employee/agent. No lawsuit has been served yet.
**Diane Reynolds (Reynolds) vs. Athena and another codefendant**: Class action allegations filed February 6, 2025, alleging violations of Maryland's Safe Act, negligence, product liability, and the State's Consumer Protection Act related to elder scams at Bitcoin ATMs. Seeks undetermined compensation (not exceeding $5.0 million) and injunctive relief.
**State of Iowa vs. Athena competitors (Lux Vending, Bitcoin Depot, CoinFlip)**: Iowa filed separate complaints on February 26, 2025, alleging Consumer Fraud Act violations by competitors. Iowa's investigation into crypto ATM companies is ongoing, and Athena has received multiple requests for information.
**Rachael Gnadinger, Madeline McCausland, and Joanne Nebus-Horning (Gnadinger) vs. Athena, CEO, and others**: Class action allegations filed May 30, 2025, alleging negligence and violations of various New Jersey statutes (stolen property, Racketeer Influenced and Corrupt Organizations, consumer fraud) related to elder scams at Bitcoin ATMs. Seeks undetermined compensation (not exceeding $5.0 million) and injunctive relief. Athena requested removal to Federal Court; Gnadinger moved to remand to State Court.
**District of Columbia vs. Athena**: Complaint filed September 8, 2025, alleging failure to disclose excessive fees and protect consumers in violation of the Districts Consumer Protection Procedures Act (CPPA) and Abuse, Neglect, and Financial Exploitation of Vulnerable Adults and the Elderly Act. Seeks declaratory judgment, permanent injunction, enjoinment from money transmissions without licenses, damages, restitution, and civil penalties. ABI filed a motion to dismiss on October 31, 2025.
**AML Software, Inc. (AML) vs. Athena, Taproot, PSBC, and Jordan Mirch**: Complaint filed September 23, 2025, alleging misappropriation of AML's proprietary Bitcoin kiosk software source code, copyright infringement, trade secret misappropriation, unfair competition, and conversion. Seeks injunctive relief, return/destruction of software, damages, disgorgement of profits, attorneys' fees, and costs. Athena is unable to predict the outcome or estimate potential loss.
**Chris Vaughan vs. ABI**: Putative nationwide class action complaint filed November 6, 2025, alleging violations of the Florida Deceptive and Unfair Trade Practices Act (FDUTPA) and the Florida Financial Exploitation of Vulnerable Adults Act related to excessive/undisclosed fees and unfair refund practices, especially for scam victims. Seeks injunctive relief, restitution, disgorgement, damages, civil penalties, and attorneys' fees/costs.
**General Allegations**: The company is subject to ongoing allegations from various U.S. states that its activities constitute money transmission without proper registration. It has agreed to various consent orders and settlements, none of which have been material to date.
**Off-Balance Sheet Arrangements**: The contract with the government of El Salvador for the operation of Chivo branded ATMs obligates the company to assume the risk of loss for funds in transit, although licensed logistics companies provide insurance coverage.

Related Party Transactions

**Red Leaf Opportunities Fund LP**: An outstanding payables balance of $63 thousand as of September 30, 2025 ($407 thousand as of December 31, 2024) is owed to Red Leaf Opportunities Fund LP, an entity in which Eric Gravengaard (a principal shareholder, former director, and former CEO) has a controlling interest.
**Move On Security LLC**: The company incurred $1.7 million in cash logistics services for the three months ended September 30, 2025, and $5.3 million for the nine months ended September 30, 2025, with Move On Security LLC. Matias Goldenhrn (CEO and director) has a 50% interest in this entity. Amounts due were $265 thousand as of September 30, 2025.
**Move On Tech Service, LLC**: The company incurred $542 thousand in ATM services for the three months ended September 30, 2025, and $1.8 million for the nine months ended September 30, 2025, with Move On Tech Service, LLC. Amounts due were $121 thousand as of September 30, 2025.
**KGPLA Holdings LLC (KGPLA)**: This entity, in which Mike Komaransky (former director, principal shareholder) has a controlling interest and Huaxing Jason Lu (director) is CIO, was involved in several transactions. The Senior Secured Loan Agreement and Revolving Credit Promissory Note, under which $4.0 million principal was repaid in March 2024, had an outstanding principal of $0 as of September 30, 2025. A convertible debenture with KGPLA, with a principal amount of $3.0 million, had its maturity extended to January 31, 2026, and remained outstanding as of September 30, 2025. KGPLA also agreed to subordinate its first priority security position to Taproot in October 2024.

Stakeholder Impact

**Shareholders**: Face potential significant dilution from future equity raises, conversion of convertible debentures, and non-cash consideration for obligations. Risk of stock price volatility and decline due to poor financial performance, market conditions, and numerous legal/regulatory issues. Limited influence on corporate matters due to concentrated ownership by founders and major shareholders. Potential negative impact from the proposed reverse stock split (e.g., reduced liquidity, no sustained price increase). Risk of delisting from Nasdaq if listing standards are not met. The stock's penny stock status and liquidity risks further compound the negative outlook.
**Employees**: May see increased salaries and benefits due to expansion of technology teams and hiring of additional management. However, there is a risk of loss of key personnel due to intense competition in the crypto industry. Employee misconduct or error could lead to legal liability, financial losses, and reputational harm. Bonuses of $2.1 million were accrued for employees and management as of September 30, 2025.
**Customers**: May experience decreased median transaction sizes for both ATM and OTC Bitcoin purchases. Face risks of operational disruptions (ATM, software, IT, blockchain) affecting transaction processing and potential theft or loss of crypto assets (though the company uses a custodian for its own assets, customers are responsible for their un-hosted wallets). Exposure to volatile crypto asset prices and potential for increased fees due to high miner/validator fees. Are subject to potential scams and fraud, leading to class action lawsuits and regulatory scrutiny. Impacted by changes in El Salvador's Bitcoin Law (voluntary use, no longer legal tender).
**Suppliers/Vendors**: The company enters into agreements with vendors for services, sometimes settled in Bitcoin. There is a risk of delayed payments or changes in payment terms. The termination of agreements with Taproot Parties represents a significant change for a key vendor.
**Creditors**: Face risks associated with the company's significant level of indebtedness ($20.685 million excluding lease liabilities), with assets secured by debt. Restrictive covenants in loan agreements limit company flexibility. There is a risk of default if cash flows are insufficient to service debt. The convertible debenture with KGPLA matures January 31, 2026.
**Regulatory Authorities**: Continue to exert ongoing scrutiny, investigations, and enforcement actions related to money transmission, securities classification of crypto assets, AML, privacy, and consumer protection. The identified material weaknesses in internal controls require remediation. The company is also subject to state and federal asset forfeiture laws.

Next Steps

Onboard additional ATM operators in key markets throughout 2025 for the Athena Bitcoin Affiliates Program to increase transaction volume and expand brand presence.
Aim to have a certain number of affiliate-operated ATMs live by the end of 2025.
Evaluate and implement proper programs to address the recent sales decrease.
Continue to remediate material weaknesses in internal control over financial reporting by hiring additional qualified accounting and financial reporting personnel, enhancing accounting processes, and designing/implementing/monitoring respective controls.
Continue attempts to engage in new discussions to entertain a settlement with Jackson in the class action lawsuit.
Await decisions from courts regarding pending motions to dismiss in the S.M. and Carew class action cases.
Proceed with obligatory arbitration proceedings under JAMS for the Yilma case.
Await the District of Columbia's opposition to ABI's motion to dismiss, after which ABI will have an opportunity to reply.
Secure counsel and answer the complaint in the AML Software, Inc. copyright infringement lawsuit.
Evaluate available defenses for the Chris Vaughan class action complaint.
Monitor developments related to new tax regulations concerning digital asset transactions and reporting practices.
Potentially apply for money transmitter or virtual currency licenses in additional jurisdictions as needed.
The company may abandon the proposed Reverse Stock Split or seek stockholder approval to adjust the Reverse Stock Split ratio in the future.

Key Dates

Date	Description
1991-12-31	GamePlan, Inc. merged with Sunbeam Solar, Inc.
2020-01-14	GamePlan, Inc. entered into a Share Exchange Agreement with Athena Bitcoin, Inc.
2020-01-15	Grant date for non-recourse loans to employees with vested stock options.
2020-01-30	Closing of the Share Exchange Agreement, resulting in Athena becoming a wholly-owned subsidiary of GamePlan, Inc.
2020-01-31	Company entered into a convertible debenture agreement with KGPLA.
2021-04-15	Company changed its name to Athena Bitcoin Global from GamePlan, Inc.
2021-09-22	Company entered into a borrowing arrangement with Banco Hipotecario.
2021-09-01	Bitcoin Law went into effect in El Salvador.
2023-07-13	Non-binding letter of intent with Arley Lozano-Jaramillo.
2023-07-19	Company began exclusively transacting in Bitcoin at its ATMs in exchange for cash.
2023-10-09	Arley Lozano-Jaramillo commenced legal proceedings against the Company.
2023-11-02	Company entered into a finance lease with Taproot.
2023-12-01	Company entered into financing agreements with Capital Premium Financing, Inc. and extended non-recourse loan agreements by one year to 60 months.
2024-02-09	Company filed a motion to dismiss Lozano's complaint.
2024-02-26	Company entered into a financing agreement with National Partners PFco LLC for D&O insurance.
2024-03-28	Company repaid the principal amount of $4.0 million on the Senior Secured Revolving Credit Promissory Note due with KGPLA.
2024-06-01	Company implemented and began to use software platform from PSBC, LLC.
2024-06-21	Digital Access, LLC filed a complaint against Athena.
2024-06-30	Settlement agreement entered into between Chivo and the Company.
2024-08-20	Keon Jackson filed a Class Action Complaint against Athena.
2024-09-09	S.M. filed a class action complaint against Athena.
2024-09-19	Company and Taproot Acquisition Enterprises, LLC entered into an Omnibus Equipment Refinancing Agreement.
2024-10-06	Plaintiff Lozano presented his answer to the Company's counter-complaint.
2024-10-11	Company increased D&O insurance coverage and entered into an additional financing agreement.
2024-10-25	S.M. filed its First Amended Class Action Complaint.
2024-10-30	Company entered into an Equipment Financing Agreement with Taproot.
2024-11-25	Karen Carew filed a class action complaint against Athena.
2024-12-01	New three-year MSA and SLA with Chivo, Sociedad Annima de Capital Variable became effective.
2024-12-19	Company entered into financing agreements with National Partners PFco LLC for commercial liability insurance.
2024-12-20	Company and Chivo agreed to a new three-year MSA and SLA.
2024-12-31	Company cancelled non-recourse loans in favor of employees.
2025-01-01	Company adopted ASU 2023-08, measuring crypto assets at fair value.
2025-01-21	Girma Yilma filed a class action complaint against Athena.
2025-01-29	Six articles of El Salvador's Bitcoin Law modified, three repealed; Bitcoin no longer considered legal tender and its use became voluntary.
2025-01-31	Last payment due for Taproot Equipment Financing Agreement.
2025-02-06	Zamareeh Odoms sent an extrajudicial claim for $500 thousand against Athena.
2025-02-26	State of Iowa filed separate complaints against Athena competitors.
2025-03-21	Athena filed a motion to compel arbitration in Yilma case.
2025-03-24	Reynolds complaint served upon Athena.
2025-03-25	Order of Dismissal entered in Digital Access, LLC case.
2025-05-14	Company entered into a Second Amendment to the Development Services Agreement with PSBC, LLC.
2025-05-14	Initial Form S-1 Registration Statement was declared Effective.
2025-05-30	Company entered into insurance premium financing agreements with E.T.I. Financial Corporation. Warrants to purchase 100,000 shares of Athena Bitcoin, Inc. common stock expired.
2025-06-01	Athena Bitcoin Affiliates Program fully rolled out.
2025-06-18	Court issued an Order Granting Motion for Class Certification in Jackson case.
2025-07-02	Resale registration statement for 473,874,346 shares became effective.
2025-07-07	Majority stockholders approved Reverse Stock Split and the 2025 Equity Compensation Plan.
2025-07-16	Court entered an Order granting in part and denying in part Jackson's motion for summary judgment. Caren filed a second amended complaint.
2025-08-13	Yilma case administratively closed and referred to obligatory arbitration.
2025-09-04	Company entered into a Release and Termination Agreement with Taproot and Taproot Parties.
2025-09-08	District of Columbia filed a complaint against Athena.
2025-09-15	Gnadinger moved to request the case be remanded back to the State Court.
2025-09-23	AML Software, Inc. filed a complaint against Athena.
2025-09-30	End of the reporting period for the 10-Q filing.
2025-10-30	Stable coins make up an estimated 7.7% of the total market cap of crypto assets.
2025-10-31	ABI filed a motion to dismiss in District of Columbia case.
2025-11-06	Plaintiff Chris Vaughan filed a putative nationwide class action complaint against ABI.
2025-11-13	Filing date of the 10-Q report.
2025-11-14	PSBC, LLC support services agreement ends.
2026-01-20	Trial scheduled to commence in Jackson class action lawsuit.
2026-01-31	Maturity date for convertible debenture with KGPLA.
2026-03-02	Trial scheduled for Lozano legal proceeding.
2027-12-31	New MSA and SLA with Chivo expires.

Recommendation

strong sell

The company reported a significant net loss for the quarter, a substantial decline in revenue and gross profit, and a large one-time loss on debt extinguishment. Cash flow from operations also decreased dramatically. The identified material weaknesses in internal controls indicate fundamental operational and financial reporting deficiencies. Furthermore, the company faces numerous ongoing class-action lawsuits and regulatory investigations related to consumer fraud, product liability, and potential violations of financial regulations, which pose significant financial and reputational risks. The high level of indebtedness, combined with the volatile nature of the crypto market and regulatory uncertainty, creates a highly precarious financial position. While there's some operational growth in ATM count and affiliate programs, these are insufficient to offset the severe financial and governance challenges. The stock's penny stock status and liquidity risks further compound the negative outlook for investors.

Keywords

Bitcoin ATM, Cryptocurrency, Digital Assets, Blockchain, Fintech, El Salvador, SEC Filing, Financial Services, Crypto Exchange, Money Transmitter

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