v3.25.2
SEGMENT REPORTING
 6 Months Ended
Jun. 30, 2025
Segment Reporting [Abstract]  
SEGMENT REPORTING

NOTE 11 – SEGMENT REPORTING

 

The Company’s principal operating segments coincide with the types of products and services to be sold. The products and services from which revenues are derived are consistent with the reporting structure of the Company’s internal organization. The Company’s two reportable segments for the three and six months ended June 30, 2025 and 2024 were (i) the development and publishing of interactive racing video games, entertainment content and services (the “Gaming segment”); and (ii) the organization and facilitation of esports tournaments, competitions and events for the Company’s licensed racing games as well as on behalf of third-party video game racing series and other video game publishers (the “esports segment”). The Company’s Chief Operating Decision Maker (“CODM”) has been identified as the Company’s Chief Executive Officer, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Segment information is presented based upon the Company’s management organization structure as of June 30, 2025 and the distinctive nature of each segment. Future changes to this internal financial structure may result in changes to the reportable segments disclosed. There are no inter-segment revenue transactions and, therefore, revenues are only to external customers. As the Company primarily generates its revenues from customers in the United States, no geographical segments are presented.

 

Segment operating profit is determined based upon internal performance measures used by the CODM. The Company derives the segment results from its internal management reporting system. The accounting policies the Company uses to derive reportable segment results are the same as those used for external reporting purposes. Management measures the performance of each reportable segment based upon several metrics, including net revenues, gross profit and operating loss. Management uses these results to evaluate the performance of, and to assign resources to, each of the reportable segments. The Company manages certain operating expenses separately at the corporate level and does not allocate such expenses to the segments. Segment income from operations excludes interest income/expense and other income or expenses and income taxes according to how a particular reportable segment’s management is measured. Management does not consider impairment charges, and unallocated costs in measuring the performance of the reportable segments.

 

 

Motorsport Games Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

 

Segment information available with respect to these reportable business segments was as follows:

 

   2025   2024   2025   2024 
   Three Months Ended June 30,   Six Months Ended June 30, 
   2025   2024   2025   2024 
Revenues:                    
Gaming  $2,591,840   $1,881,653   $4,350,293   $4,910,689 
Esports   -    -    -    - 
Total Revenues  $2,591,840   $1,881,653   $4,350,293   $4,910,689 
                     
Cost of Revenues:                    
Gaming  $454,887   $771,647   $920,273   $1,438,274 
Esports   -    -    -    - 
Total Cost of Revenues  $454,887   $771,647   $920,273   $1,438,274 
                     
Gross Profit:                    
Gaming  $2,136,953   $1,110,006   $3,430,020   $3,472,415 
Esports   -    -    -    - 
Total Gross Profit  $2,136,953   $1,110,006   $3,430,020   $3,472,415 
                     
Sales and Marketing Expenses:                    
Gaming  $126,307   $205,549   $224,008   $455,935 
Esports   -    -    -    - 
Total Sales and Marketing Expenses  $126,307   $205,549   $224,008   $455,935 
                     
Development Expenses:                    
Gaming  $270,343   $868,745   $872,296   $1,932,102 
Esports   -    -    -    - 
Total Development Expenses  $270,343   $868,745   $872,296   $1,932,102 
                     
General and Administrative Expenses:                    
Gaming  $852,282   $1,407,933   $2,015,508   $3,572,975 
Esports   12,758    3,893    18,014    29,117 
Total General and Administrative Expenses  $865,040   $1,411,826   $2,033,522   $3,602,092 
                     
Depreciation and Amortization:                    
Gaming  $5,359   $51,010   $17,310   $112,308 
Esports   6,338    12,128    12,513    24,554 
Total Depreciation and Amortization  $11,697   $63,138   $29,823   $136,862 
                     
Income (Loss) From Operations                    
Gaming  $1,989,365   $2,091,424   $1,917,646   $967,877 
Esports   (21,302)   (32,676)   (42,778)   (124,453)
Total Income From Operations  $1,968,063   $2,058,748   $1,874,868   $843,424 
                     
Interest Expense, net:                    
Gaming  $(4,740)  $(29,166)  $(17,750)  $(60,048)
Esports   -    (580)   -    (580)
Total Interest Expense, net  $(4,740)  $(29,746)  $(17,750)  $(60,628)
                     
Other Income (Expense), net                    
Gaming  $2,163,237   $89,725   $3,228,119   $(319,439)
Esports   111,612    (31,244)   175,548    (59,272)
Total Other Income (Expense), net  $2,274,849   $58,481   $3,403,667   $(378,711)
                     
Net Income (Loss):                    
Gaming  $4,259,474   $2,120,740   $5,303,563   $529,171 
Esports   (21,302)   (33,257)   (42,778)   (125,086)
Total Net Income  $4,238,172   $2,087,483   $5,260,785   $404,085 

 

 

Motorsport Games Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

 

   June 30, 2025   December 31, 2024 
Total Assets:          
Gaming  $6,674,308   $5,065,073 
Esports   1,479,832    1,203,148 
Total Assets  $8,154,140   $6,268,221