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Surgepays Q1 2025 Earnings Report
SurgePays reported a significant decrease in revenue and net income for Q1 2025, primarily due to the discontinuation of the Affordable Connectivity Program (ACP) funding.
Key Takeaways
SurgePays, Inc. experienced a substantial decline in financial performance for the first quarter of 2025, with revenue decreasing by 66.3% and a net loss of $7.64 million, compared to a net income of $1.22 million in the same period last year. This downturn is largely attributed to the cessation of the Affordable Connectivity Program (ACP) funding, which significantly impacted the Mobile Virtual Network Operator (MVNO) segment. Despite this, the Comprehensive Platform Services segment showed strong growth, and the company is pursuing new strategic initiatives to offset the revenue loss.
Total revenue decreased by $20.85 million (66.3%) from Q1 2024 to Q1 2025, primarily due to the end of the ACP program.
The company reported a net loss of $7.64 million in Q1 2025, a significant shift from the $1.22 million net income in Q1 2024.
Mobile Virtual Network Operator (MVNO) revenue plummeted by $26.61 million (92.1%) due to the discontinuation of ACP funding.
Comprehensive Platform Services revenue increased significantly by $5.76 million (227.7%), driven by an expanded sales force and renewed market focus.
Surgepays
Surgepays
Surgepays Revenue by Segment
Revenue by Segment
MVNO Revenue
CapyFin.comMVNE Platform Revenue
CapyFin.com Forward Guidance
The company is actively exploring strategic opportunities and new initiatives to mitigate the impact of the ACP program's cessation and drive future growth, focusing on expanding its MVNO and Comprehensive Platform Services segments.
Positive Outlook
- Launch of LinkUp Mobile SIM cards into the national retail market.
- Launch of LinkUp Mobile's phone in a box program.
- Active expansion of Torch Wireless subscriber base in California, offering additional revenue incentives.
- Expansion of MVNE solution to enable other wireless companies lacking direct carrier access.
- Launch of Clear-line's comprehensive code management campaign in over 1,600 convenience stores.
Challenges Ahead
- Cessation of the Affordable Connectivity Program (ACP) funding on June 1, 2024, leading to significant revenue reduction.
- Potential insufficient resources to fund operations for the next twelve months without additional funding.
- Uncertainty regarding the timing and commitment of strategic opportunities.
- The company has historically incurred significant losses and has not demonstrated an ability to generate sufficient revenues to achieve profitable operations.
- The company absorbed wholesale costs for 250,000 former ACP subscribers to keep them active, impacting cash inflow.
Revenue & Expenses
Visualization of income flow from segment revenue to net income