10-K: Gold Rock Holdings Reports Revenue Growth Amidst Going Concern Doubts

Gold Rock Holdings, Inc. reported increased revenues for fiscal year 2025 driven by its AI division, but faces substantial doubt about its ability to continue as a going concern due to accumulated losses and a working capital deficit.

Summary

• Gold Rock Holdings, Inc. (GRHI) is a holding company focused on acquiring technological assets, having shifted its business model in October 2023 from engineering and construction management services.
• The company operates through two main divisions: LOOT8, Inc., a Web3 Commerce and Content Management Engine Software subsidiary, and the K-Project Artificial Intelligence (AI) division.
• LOOT8, Inc. is developing a Web3 content management system (CMS) for a "Relationship Economy" through SocialFi, with planned revenue streams from direct-to-consumer (D2C) digital collectibles, youth market avatars, and enterprise SaaS/PaaS solutions.
• The K-Project AI division, launched in June 2024, offers AI coding and language learning tools, and has successfully completed beta versions of its SAID (Speech Artificial Intelligence On Demand) translation app and ZONE-X sports AI application.
• For the fiscal year ended December 31, 2025, total revenues increased to $211,500 from $138,500 in 2024, primarily driven by the K-Project AI division ($210,000) and a small sponsorship for LOOT8 ($1,500).
• The company reported a net loss of $180,564 for 2025, an improvement from the $240,694 net loss in 2024, attributed to decreases in advertising, consulting, and general and administrative costs.
• As of December 31, 2025, Gold Rock Holdings had total assets of $152,121 (all cash), total liabilities of $154,431, an accumulated deficit of $1,287,295, and a working capital deficit of $2,310.
• The company used $57,493 in net cash for operating activities in 2025 and received no cash from financing activities, compared to $425,700 in 2024.
• Management has identified a material weakness in internal control over financial reporting due to inadequate segregation of duties within its cash disbursement and financial reporting processes.
• The company's ability to continue as a going concern is in substantial doubt, dependent on generating profitable operations and/or obtaining additional financing.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this as a highly speculative filing. While revenue growth and reduced net loss are positive, the explicit 'going concern' warning, significant accumulated deficit, and internal control weaknesses present substantial risks, outweighing early product development successes.

Positives

• Revenue increased to $211,500 in 2025 from $138,500 in 2024, representing a 52.7% year-over-year growth.
• Net loss decreased to $180,564 in 2025 from $240,694 in 2024, indicating improved cost management in certain areas.
• Gross profit margins remained at 100% for both 2025 and 2024, as there was no cost of goods sold.
• The K-Project AI division generated $210,000 in revenue from one customer in 2025, demonstrating initial commercial success for its AI coding and language modeling services.
• Successful beta completion of the SAID translation app and ZONE-X sports AI app indicates progress in product development for the K-Project AI division.
• Advertising fees decreased significantly to $7,280 in 2025 from $31,357 in 2024.
• Consulting fees decreased to $16,040 in 2025 from $27,000 in 2024.
• General and Administrative expenses decreased to $63,352 in 2025 from $108,337 in 2024.
• A refund of $12,200 was received in March 2026 for an overpayment on software engineering services for the SAID AI platform.

Negatives

• The company has an accumulated deficit of $1,287,295 as of December 31, 2025.
• A net loss of $180,564 was reported for the fiscal year ended December 31, 2025.
• The company has a working capital deficit of $2,310 as of December 31, 2025.
• Net cash used in operating activities was $57,493 in 2025.
• No cash was provided by financing activities in 2025, a significant drop from $425,700 in 2024.
• Cash balance decreased to $152,121 at year-end 2025 from $209,614 at year-end 2024.
• LOOT8, Inc., the Web3 subsidiary, generated only $1,500 in revenue from a single sponsorship in 2025, and its "Singer and Song Writer Contest" cost more than the sponsorship received.
• Engineering fees increased substantially to $80,392 in 2025 from $0 in 2024.
• Board of Directors/Officer Compensation increased to $225,000 in 2025 from $212,500 in 2024.
• The CEO, Marcus Daley, and Chairman, Merle Ferguson, do not have compensation agreements in place, which could indicate financial strain or uncertainty regarding their long-term commitment.
• A significant portion of Anthony Denkinger's (COO of GRHI, CEO of LOOT8) compensation ($2,500 per month) is deferred due to the company's financial health.

Risks

• Substantial doubt exists about the company's ability to continue as a going concern due to an accumulated deficit of $1,287,295, a net loss of $180,564, and net cash used in operating activities of $57,493 in 2025.
• The company is completely dependent on additional debt and equity financing to execute its business plan, develop services, and respond to competitive pressures, with no assurance of success in raising funds on acceptable terms.
• A material weakness in internal control over financial reporting exists due to inadequate segregation of duties within cash disbursement and financial reporting processes, which could lead to undetected material misstatements.
• The company relies heavily on third parties for technology and its ability to integrate and manage acquired technology, assets, companies, and personnel.
• Operations are in a volatile and intensely competitive environment, particularly in the business sectors in which it operates (AI, Web3).
• The company is exposed to risks associated with rapid technological change.
• Dependence on key and scarce employees in a competitive market for skilled personnel poses a risk.
• The company does not have a qualified financial expert on its Board of Directors, which could impact financial oversight.
• Issuances of preferred stock in the future could adversely affect the voting power of common stockholders.
• The company has not paid dividends and does not anticipate doing so in the foreseeable future.
• Concentration risk exists as sales in 2025 were with only two customers, and in 2024 with only one customer.

Future Outlook

Management plans to fully deploy, market, and utilize its LOOT8 platform, expanding blockchain innovation in digital assets and SocialFi, and building out its K-Project Division by focusing on AI software solutions and programs. The K-Project expects to expand sales and marketing of its language learning services and other AI initiatives to create specific AI personas for various industries, including healthcare, law enforcement, and education. The company intends to raise additional funds through debt or equity offerings to support its business plan and operations.

Management Comments

• "Management believes that the [SAID] App could have an enormous application for a number of industry wide uses, including but not limited to health care, first responders, travel, sports, law enforcement, governmental agencies, and other industries."
• "Management believes that the actions presently being taken to further implement our business plan and generate revenues provide the opportunity for Gold Rock Holdings, Inc. to continue as a going concern."
• "While we believe in the viability of our business strategy to generate revenues and in our ability to raise additional funds, we may not be successful."
• "The Company is continuing the process of remediating its control deficiencies. However, the material weakness in internal control over financial reporting that has been identified will not be remediated until numerous internal controls are implemented and operate for a period of time, are tested, and the Company is able to conclude that such internal controls are operating effectively."
• "Management plans, as capital becomes available to the Company, to increase the accounting and financial reporting staff and provide future investments in the continuing education and public company accounting training of our accounting and financial professionals."

Industry Context

StockSavvy.ai notes that Gold Rock Holdings is positioning itself in the high-growth sectors of Web3, blockchain, and artificial intelligence, which are experiencing rapid innovation and significant investment. The company's focus on a 'Relationship Economy' through SocialFi and specialized AI applications like SAID and ZONE-X indicates an attempt to carve out niche markets within these competitive landscapes. However, its early stage of commercialization and reliance on a limited customer base for current revenues highlight the significant challenges and capital requirements typical for startups in these technologically advanced and capital-intensive industries.

Comparison to Industry Standards

• StockSavvy.ai observes that Gold Rock Holdings' current revenue of $211,500 and net loss of $180,564 for 2025 are indicative of a very early-stage technology company, far below the revenue and profitability benchmarks of established players in the AI or Web3 space.
• For instance, leading AI companies like NVIDIA or Google (Alphabet) generate billions in revenue from AI-related products and services, while even smaller, publicly traded AI startups typically report revenues in the millions.
• In the Web3 sector, successful platforms often demonstrate significant user adoption and transaction volumes, leading to substantial revenue generation, which is not yet evident for LOOT8, Inc. beyond a minimal sponsorship.
• The company's "going concern" warning is a critical indicator that it has not yet achieved the financial stability or scale seen in more mature or even rapidly growing emerging technology firms.
• The lack of a qualified financial expert on the board and identified material weaknesses in internal controls are governance issues that would be atypical for more established or well-funded industry peers.

Management Changes

Corporate Governance

Legal Proceedings

• No material pending legal proceedings to which the Company is a party or as to which any of its property is subject, and no such proceedings are known to the Company to be threatened or contemplated against it.

Related Party Transactions

• Richard Kaiser, CFO, Secretary, and Director, is the owner of YES International, which provides consulting services to the company for $1,000 per month ($12,000 in 2025 and 2024).
• The company paid YES International $5,905 in 2025 and $5,265 in 2024 for press release wire services and Edgar filing fees.
• The company operates out of YES International, LLC offices at no cost.
• A director made a capital contribution of $700 in 2024 by paying an invoice on behalf of the company.
• Anthony Denkinger, COO of Gold Rock Holdings and CEO of LOOT8, Inc., has $2,500 per month of his compensation deferred, with $57,500 accrued as deferred compensation as of December 31, 2025, due to the company's financial health.

Stakeholder Impact

• Shareholders: Face significant risk due to the "going concern" warning, accumulated deficit, and working capital deficit. Potential dilution from future capital raises. The lack of dividends and low stock price ($0.022 as of Dec 31, 2025) indicate limited returns.
• Employees/Management: Compensation for key executives (CEO, Chairman) is not formalized, and a portion of the COO's compensation is deferred, indicating potential instability or financial constraints affecting personnel.
• Creditors: May face increased risk due to the company's financial instability and reliance on future financing.
• Customers: The concentration of revenue from a very small number of customers (two in 2025, one in 2024) poses a risk to revenue stability if these relationships change.

Next Steps

• Fully deploy, market, and utilize the LOOT8 platform, expanding blockchain innovation in digital assets and SocialFi.
• Expand into direct-to-business relationships with the LOOT8 platform.
• Build forward the K-Project Division, focusing on AI software solutions and programs.
• Expand sales and marketing of K-Project's unique language learning services and other AI initiatives to create specific AI personas for various industries.
• Actively market ZONE-X for widespread commercialization.
• Remediate identified material weaknesses in internal control over financial reporting.
• Raise additional funds through debt or equity financing.
• Increase accounting and financial reporting staff and invest in professional training as capital becomes available.
• Obtain a qualified financial expert for the Board of Directors when the company's financial position improves.

Key Dates

Recommendation

The 'going concern' warning, coupled with a significant accumulated deficit and negative working capital, indicates severe financial distress. While revenue increased, the company remains unprofitable and relies entirely on future financing, which is uncertain. The identified material weakness in internal controls further exacerbates risk. For a seasoned investor, these factors point to a high-risk investment with substantial downside potential, making a 'sell' recommendation prudent to avoid further capital erosion.

Keywords

Web3, AI, Artificial Intelligence, Blockchain, Content Management System, SocialFi, Digital Assets, SaaS, PaaS, Fintech, Technology Holdings, SEC 10-K, Gold Rock Holdings