Annual Report for Fiscal Year Ending December 31, 2025 (Form 10-K)

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

RESULTS OF OPERATIONS

		Year Ended December 31,
		2025								2024								Change
						% of								% of
		Amount				Revenue				Amount				Revenue				Amount				%
Revenue		$	11,131				100	%		$	18,159				100	%		$	(7,028	)			(38.7	)%
Cost of revenue			5,824				52.3	%			10,766				59.3	%			(4,942	)			(45.9	)%
Gross profit			5,307				47.7	%			7,393				40.7	%			(2,086	)			(28.2	)%
Operating expenses:
Research and development			559				5.0	%			3,848				21.2	%			(3,289	)			(85.5	)%
General and administrative			4,398				39.5	%			2,975				16.4	%			1,423				47.8	%
Payroll and payroll taxes			5,196				46.7	%			9,560				52.6	%			(4,364	)			(45.6	)%
Professional fees			3,290				29.6	%			4,254				23.4	%			(964	)			(22.7	)%
Stock compensation expense			889				8.0	%			624				3.4	%			265				42.5	%
Depreciation and amortization			397				3.6	%			2,011				11.1	%			(1,614	)			(80.3	)%
Impairment of goodwill			-				-				6,675				36.8	%			(6,675	)			(100.0	)%
Impairment of intangible assets			1,828				16.4	%			3,028				16.7	%			(1,200	)			(39.6	)%
Restructuring charges			1,898				17.1	%			1,636				9.0	%			262				16.0	%
Total operating expenses			18,455				165.8	%			34,611				190.6	%			(16,156	)			(46.7	)%
Loss from operations			(13,148	)			(118.1	)%			(27,218	)			(149.9	)%			14,070				(51.7	)%
Other income (expense):
Interest expense			(1,793	)			(16.1	)%			(869	)			(4.8	)%			(924	)			106.3	%
Accretion of debt discount			(150	)			(1.3	)%			(2,259	)			(12.4	)%			2,109				(93.4	)%
Legal settlements expense			(905	)			(8.1	)%			(2,064	)			(11.4	)%			1,159				(56.2	)%
Other income (expense)			260				2.3	%			(330	)			(1.8	)%			590				(178.8	)%
Total other (expense), net			(2,588	)			(23.3	)%			(5,522	)			(30.4	)%			2,934				(53.1	)%
Loss from continuing operations before income taxes			(15,736	)			(141.4	)%			(32,740	)			(180.3	)%			17,004				(51.9	)%
Provision for income taxes			318				2.9	%			390				2.1	%			(72	)			(18.5	)%
Net loss from continuing operations			(16,054	)			(144.2	)%			(33,130	)			(182.4	)%			17,076				(51.5	)%
(Loss) income from discontinued operations, net of tax			(1,472	)			(13.2	)%			6,305				34.7	%			(7,777	)			(123.3	)%
Net loss		$	(17,526	)			(157.5	)%		$	(26,825	)			(147.7	)%		$	9,299				(34.7	)%

Revenue

Historically, the Company generated the majority of its revenue from the acceptance and processing of credit and debit card payments on behalf of merchants that operate principally online. Such revenue was generated from fees charged based on a percentage of the value of each transaction processed and/or upon fixed amounts specified in each transaction or service. Following the sale of the Company's wholly owned subsidiary, Ryvyl EU, effective June 1, 2025, the Company now primarily generates revenue from fees earned from payment processing transactions where the Company arranges for the delivery of those services to the merchant by a payment processor and from banking services, which primarily include incoming and outgoing ACH and wire transfer transactions. For revenue earned from arranging for the delivery of payment processing services to merchants by a payment processor, the Company typically charges specified fees on a per transaction basis, a percentage share of the transaction amount, or a combination of both. For banking services transactions, the Company typically charges specified fees on a per transaction basis, which may vary from customer to customer.

Total revenue for the year ended December 31, 2025, decreased by $7.0 million, or 38.7%, compared to the year ended December 31, 2024. The decrease in revenue was primarily driven by the previously disclosed loss of revenue associated with the Company's discontinuation of its QuickCard product during the first quarter of 2024.

Cost of Revenue

Cost of revenue primarily consists of various fees charged by payment processors, fees paid to Independent Sales Organization partners (ISOs), and fees paid to banks for banking transactions. Total cost of revenue for the year ended December 31, 2025, decreased by $4.9 million, or 45.9%, compared to the year ended December 31, 2024. The decrease in consolidated cost of revenue is consistent with the decline in revenue primarily associated with the QuickCard product transition, as discussed above.

Operating Expenses

Operating expenses for the year ended December 31, 2025, decreased by $16.2 million, or 46.7%, compared to the year ended December 31, 2024. The decrease was primarily driven by the following:

●

Research and development expenses decreased by $3.3 million or 85.5%, primarily due to the completion of the development of the NEMS Core platform and no new major projects in 2025.

●

General and administrative expenses increased by $1.4 million, or 47.8%, primarily due to impairments recorded during the year on the ROU asset related to one of the Company's operating leases.

●

Payroll and payroll taxes decreased $4.4 million, or 45.6%, primarily due to reductions in force during the year to better align with the Company's reduced operations following the discontinuation of the QuickCard product and sale of Ryvyl EU, effective June 1, 2025.

●

Professional fees decreased $1.0 million, or 22.7%, primarily due to lower legal, audit, accounting advisory, and financial statement audits and tax services fees.

●

Depreciation and amortization decreased $1.6 million or 80.3%, primarily due to lower amortization expense following the impairment of the majority of the Company's remaining intangible assets during the year.

●

Impairment of goodwill and intangible assets decreased $7.9 million, or 81.2%, primarily due to the full impairment of the Company's goodwill and customer relationships intangible assets of $6.7 million and $3.0 million, respectively, during 2024, partially offset by the impairment of the Company's internal-use software intangible asset of $1.8 million during 2025.

Restructuring charges increased $0.3 million, or 16%, primarily due to severance and termination benefits incurred in connection with additional reductions in force during 2025, as part of management's efforts to better right size the Company's cost structure following the discontinuation of the QuickCard product and the sale of Ryvyl EU, effective June 1, 2025.

Other Expense, Net

Other expense, net for the year ended December 31, 2025, decreased $2.9 million, or 53.1%, compared to the year ended December 31, 2024. This decrease was primarily driven by the following:

●

Interest expense increased $0.9 million, or 106.3%, primarily due to interest incurred on the note payable secured by the Company on January 23, 2025, which was subsequently retired during the second quarter of 2025.

●

Accretion of debt discount decreased by $2.1 million, or 93.4%, due to the write-off of a majority of the remaining unamortized discount on the convertible note due to its early retirement during the first half of 2025.

●

Legal settlements decreased $1.2 million or 56.2%, due to lower legal settlements activity during 2025.

●

Other income, net was $0.3 million for the year ended December 31, 2025, compared to other expense, net of $0.3 million during the year ended December 31, 2024. The year-over-year change was primarily driven by derecognition expense on conversion of convertible debt, which improved from an expense of $0.6 million for the year ended December 31, 2024, to a gain of $0.2 million for the year ended December 31, 2025, primarily due to the Company's early retirement of its convertible note during the first half of 2025.

LIQUIDITY AND CAPITAL RESOURCES

The Company's consolidated working capital at December 31, 2025, was $1.1 million, which included cash of $7.4 million and a negligible amount of restricted cash. Historically, the Company has financed its operations with proceeds from cash from operations, the sales of equity securities, and proceeds from its $100 million Note issued in November 2021. Our material liquidity needs principally relate to working capital requirements.

As further described in section titled "Going Concern" under Note 2, Summary of Significant Accounting Policies, since the first quarter of 2024, the Company's liquidity has been adversely impacted by the loss of revenues stemming from the discontinuation of its QuickCard product. As also noted therein, through the first quarter of 2025, the Company had relied on the repatriation of profits from its European subsidiaries to cover some of its critical operating expenses, which it is no longer able to do following the sale of Ryvyl EU, effective June 1, 2025. Additionally, the Company's remaining businesses continue to generate operating losses, which is expected to continue to occur for at least the next 12 months. Due to these developments, management has determined that its cash balance as of December 31, 2025, will not be sufficient to fund the Company's operations and capital needs for the next 12 months from the date of this Report. The Company's ability to successfully address its liquidity shortfall is contingent upon the successful execution of management's intended remediation plan over the next twelve months, which include, but are not limited to the following:

	●	raising additional capital through a variety of means, including private and public equity offerings and debt financings. The Company recently executed multiple successful capital raises in July 2025 and October 2025, and continues to be actively engaged in discussions with multiple parties for additional funding opportunities;
	●	exploring strategic initiatives, including M&A opportunities; on September 28, 2025, the Company, Ryvyl Merger Sub Inc. (a Delaware corporation and wholly owned direct subsidiary of the Company ("Merger Sub"), and RTB Digital, Inc., a Delaware corporation ("RTB"), entered into an Agreement and Plan of Merger pursuant to which Merger Sub will merge with and into RTB (the "Merger"), with RTB surviving the Merger as a wholly-owned subsidiary of the Company, which is expected to close during the second quarter of 2026;
	●	continued execution of its accelerated business development efforts to drive volumes in diversified business verticals with the Company's other products; and
	●	continued implementation of cost control measures to more effectively manage spending and further right-sizing the organization, where appropriate;

Management has assessed that its intended plan described above, if successfully implemented, is appropriate and sufficient to address its liquidity shortfall and to provide funds to cover operations for the next 12 months from the date of the issuance of this Report. However, there can be no assurance that we will be successful in implementing our plan, that our projections of our future capital needs will prove accurate, or that any additional funding will be available on a timely manner, on favorable terms, or be sufficient to continue our operations. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

Cash Flow Activities

The following table shows cash flows for the periods presented (in thousands):

		Year Ended December 31,
		2025				2024
Net cash (used in) provided by operating activities		$	(23,041	)		$	21,191
Net cash used in investing activities			(76,350	)			(1,808	)
Net cash provided by (used in) financing activities			13,889				(241	)
Effects of exchange rates on cash and restricted cash			904				(430	)
Net (decrease) increase in cash and restricted cash		$	(84,598	)		$	18,712

Cash Flows from Operating Activities

For the year ended December 31, 2025, net cash used in operating activities was $23.0 million, primarily due to a net loss of $17.5 million, and net outflows related to changes in accounts payable of $1.1 million and payment processing liabilities of $17.6 million. These outflows were partially offset by the change in prepaid and other current assets of $0.5 million, and non-cash adjustments, primarily, depreciation and amortization of $0.5 million, noncash lease expense of $0.9 million, stock compensation expense of $0.9 million, loss on the sale of Ryvyl EU of $6.5 million, impairment of intangible assets of $1.8 million, and restructuring charges of $1.9 million.

For the year ended December 31, 2024, net cash provided by operating activities was $21.2 million, primarily due to net inflows related to changes in prepaid and other current assets of $0.7 million, cash due from gateways of $12.7 million, accounts payable and other accrued liabilities of $3.2 million, and payment processing liabilities of $14.0 million, and non-cash adjustments, primarily, depreciation and amortization of $2.3 million, stock based compensation of $0.6 million, accretion of debt discount of $2.3 million, changes in fair value of derivative liability of $0.6 million, impairment of goodwill and intangibles of $9.7 million, and restructuring charges of $1.6 million. These inflows were partially offset primarily by a net loss of $26.8 million during the year.

Cash Flows from Investing Activities

For the year ended December 31, 2025, net cash used by investing activities was $76.4 million, primarily driven by cash transferred in connection with the sale of Ryvyl EU of $75.0 million and capitalized software development costs of $1.1 million.

For the year ended December 31, 2024, net cash used by investing activities was $1.8 million, primarily due to outflows related to capitalized software development costs of $1.8 million.

Cash Flows from Financing Activities

For the year ended December 31, 2025, net cash provided by financing activities was $13.9 million, primarily driven by proceeds from the short term note payable secured on January 23, 2025 of $15.0 million, issuance of common stock in a public offering of $5.4 million, common warrant exercises of $1.5 million, and issuance of Series C convertible preferred stock of $5.0 million. These inflows were partially offset by outflows related to the repayment of the Company's convertible note of $13.0 million. For the year ended December 31, 2024, net cash used in financing activities was immaterial.

CRITICAL ACCOUNTING ESTIMATES

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the U.S. ("GAAP") requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. These estimates and assumptions affect, among other things, the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

We evaluate our estimates and assumptions on an ongoing basis based on historical experience and other factors that we believe to be reasonable under the circumstances. Our significant accounting policies are described in Note 1, Summary of Significant Accounting Policies, of this Report. Management has determined that the Company did not have any critical accounting estimates during the periods presented.

RECENT DEVELOPMENTS

Merger Agreement with RTB Digital, Inc.

Basic Merger Terms

Ryvyl and RTB entered into an Agreement and Plan of Merger, dated as of September 28, 2025 (the "Merger Agreement"), whereby RTB would combine with Ryvyl. The Merger Agreement contains the terms and conditions of the proposed business combination of Ryvyl and RTB. Under the Merger Agreement, RYVYL Merger Sub Inc., a wholly owned subsidiary of Ryvyl ("Merger Sub"), will merge with and into RTB, with RTB surviving as a wholly owned subsidiary of Ryvyl (referred to as the "merger").

At the effective time of the merger (the "Effective Time"), certain outstanding securities of the RTB securityholders will be converted into the right to receive the Pro Rata Portion of the Merger Shares (defined terms in the Merger Agreement. In addition, Ryvyl will assume the RTB stock option plan and certain other outstanding securities which will from then be exercisable for exchangeable into Ryvyl common stock. It is anticipated that outstanding RTB warrants will have been "net" exercised prior to the closing in exchange for shares of RTB common stock in accordance with their terms and shall no longer be outstanding and shall automatically be cancelled, extinguished, and retired and shall cease to exist, provided, however, that in the event that any such RTB warrants are not so exercised, to the extent that by their terms they do not continue to represent the right to acquire securities of the Company on comparable terms to those of RTB warrants, then the parties of the Merger Agreement shall negotiate in good faith and use commercially reasonable efforts to mutually agree as promptly as practicable to such amendments the Merger Agreement as are necessary to reflect an assumption, exchange or similar accommodation for such RTB warrants, provided that such assumption, exchange or similar accommodation shall be reasonably satisfactory to each party of the Merger Agreement. Additionally, pursuant to the Merger Agreement, Ryvyl will assume the outstanding convertible notes of RTB, which after the merger will be converted into shares of the combined company.

As of January 30,2026, as a result of the merger, current holders of RTB's common stock, and options and warrants to purchase RTB's common stock are expected to own, or hold rights to acquire, in the aggregate of approximately 15,215,399 shares of Ryvyl common stock, representing approximately 84.85% (excluding the shares that may be issued on conversion of the RTB convertible notes) of the fully-diluted common stock of Ryvyl, which for these purposes is defined as the outstanding common stock of Ryvyl (including the shares of common stock issued in the merger), plus all options and warrants of Ryvyl outstanding immediately prior to the merger, plus all options and warrants of RTB converted into options and warrants of Ryvyl in connection with the merger (the "Fully-Diluted Common Stock of Ryvyl"), and Ryvyl's current stockholders, option holders and warrant holders are expected to own, or hold rights to acquire, in the aggregate approximately 15.15% of the Fully-Diluted Common Stock of Ryvyl, in each case, following the Effective Time of the merger. The assumption and conversion of the RTB convertible notes after consummation of the merger will substantially reduce the foregoing percentages. Also, as a result of the merger, the Series C Preferred Stock issued by Ryvyl to RTB will be cancelled.

Business of RTB

RTB (d/b/a "Roundtable") has developed and operates a professional SaaS (Software as a Service) platform which hosts an exclusive coalition of professionally-managed online media channels. RTB's operations primarily consisted of software development; advertising and sponsorship sales; and identifying and signing a group of select "Platform Partners" to operate on its platform. Each channel is organized around a topic and is operated by an invite only Platform Partner, typically a major media company, but also drawn from subject matter experts, reporters, and thought leaders. Platform Partners publish professional content and oversee an online community for their respective channels, leveraging RTB's proprietary, Web3-based, socially-driven, mobile-enabled, video-focused technology platform ("Platform") engaging niche audiences within a single coalition.

Platform Partners incur the costs of content creation on their respective channels and receive a share of the revenue associated with their content, typical 50% after certain direct costs are deducted. Because of the state-of the-art technology and large scale of the Platform and the expertise in search engine optimization, user engagement, ad monetization and content distribution, Platform Partners continually benefit from ongoing technological advances and audience development expertise. While the Platform Partners benefit from these critical performance improvements, they may also save substantial technology, infrastructure, advertising sales, member marketing and management costs.

RTB operates websites at thestreet.com/crypto, RoundtableSports.io, TheHockeyNews.com, Roundtable.io, MissWorld.com, rtb.MissWorld.com, and others. The information contained on the official website of RTB (RTB.io) and information about RTB on any other personal, viral, social network informational websites or software applications, do not constitute part of this report or future reports or schedules filed with the Securities and Exchange Commission ("SEC") or other state securities regulatory bodies.

RTB's strategy includes acquiring related online media, publishing and technology businesses by merger or acquisition that management believes will expand the scale of unique users interacting on the RTB technology platform. RTB believe that with an increased scale in unique users, RTB will be able to obtain improved advertising terms and grow advertising revenue.

The Platform

The proprietary online publishing, community, and video platform provides the Platform Partners (who are third parties producing and publishing content typically on their own domains), and individual creators contributing content to the RTB owned and operated sites ("Expert Contributors"), the ability to produce and manage editorially focused content through tools and services provided by RTB. RTB has also developed proprietary advertising technology, techniques and relationships that allows RTB, the Platform Partners, and the Expert Contributors to monetize editorially focused online content through various display and video advertisements and other monetization services (the "Monetization Solutions" and, together with the Platform, the "Platform Services").

The Platform is comprised state-of-the-art publishing tools, video services, social/community engagement features, content distribution channels, newsletter technology, content recommendations, notifications, white-label apps for iOS and Android, and other technology that delivers a complete set of features to drive a digital media business upon an entirely cloud-based suite of services. The software engineering and product development teams of RTB are experienced at delivering these services at scale. RTB continues to develop the Platform software by combining proprietary code with components from the open-source community, plus select commercial services, as well as identifying, acquiring, and integrating other platform technologies where RTB see unique long-term benefits to us.

The Platform Services include:

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Content management, content recommendations, and traffic redistribution;

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Hosting and bandwidth;

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Secure, blockchain-based storage of user data and content;

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Video publishing, hosting, and player solution;

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Community/social features, including ability for users to post text, images & videos; video threads; "likes", comments and @mentions; reporting and moderation tools including AI-based moderation and spam control; user reputation and gamification;

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Native iOS and Android mobile Apps, with in-app notifications and white-label capability for major brands;

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Real-time reporting as well as integration with Google Analytics;

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User account management with multi-level access controls;

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Content and user account migration to the Platform, including text, images, videos, emails and membership data;

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Technical support team to support the Platform Partners and staff (if applicable) on the Platform;

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Advertising serving, trafficking/insertion orders, yield management, reporting and collection;

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Ability to pay Platform Partners via crypto;

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Various integrations to enable syndication of content e.g., MSN, Yahoo, Apple News, Google News and RSS feeds; and

●

Other features, as they may be added to the Platform from time to time.

Platform Partners Business Model

Platform Partners use the Platform Services to produce, manage, host and monetize their content in accordance with the terms and conditions of partner agreements between each of the Platform Partners and RTB (the "Partner Agreements"). The Platform Partners incur the costs with respect to creating their content; thus, not requiring expenditures by RTB. Pursuant to the Partner Agreements, RTB and the Platform Partners split revenue generated from the Platform Services used in connection with the Platform Partner's content based on certain criteria. Criteria include whether the revenue was from digital advertising sales, was generated by the Platform Partner or RTB, was generated in connection with a subscription or a membership, was generated from syndicating or third party licensing, or was derived from affiliate links.

Subject to the terms and conditions of each Partner Agreement and in exchange for the Platform Services, the Platform Partners grant RTB, for so long as the Platform Partner's assets are hosted on the Platform, (i) the right to use, host, store, cache, reproduce, publish, publicly display, distribute, transmit, modify, adapt and create derivative works of the content provided by the Platform Partner to provide, maintain and improve the Platform Services; (ii) use, publicly display, distribute and transmit the name, logo, and trademarks of the Platform Partner to identify them as users of the Platform Services; (iii) exclusive control of ads.txt with respect to the Platform Partner's domains; and (iv) with some exceptions, the exclusive right to include the Platform Partner's website domains and related URLs in a consolidated listing assembled by third party measurement companies such as comScore, Nielsen or other similar measuring services selected by RTB. As such, the Platform serves as the primary digital media and social platform with respect to each of the Platform Partners' website domains during the applicable term of each Partner Agreement.

The Role of Bitcoin and Cryptocurrency: Fuel for Growth

RTB believes that it can reduce the typical waiting period that a Platform Partner would have to receive revenue from the current industry typical time period of 30-90 days to a practically instantaneous transfer through the establishment of "liquidity pools" that would allow the swapping of ad revenue receivables for BTC or stablecoins. As currency accumulates in RTB "liquidity pool", it will be used as "growth collateral" to back up revenue guarantees offered to major media partners recruited to utilize the platform. Since these guarantees are based on existing advertising and sponsorship revenues, and RTB expects to outperform the partners' prior top-line monetization, RTB also expects the treasury to continue growing. The sequence looks like this:

1.

Media partners/publishers generate ad inventory on their online properties;

2.

Major brands purchase ads, paying us using "fiat" or traditional currencies;

3.

We then convert this revenue to Bitcoin, stablecoins or other currencies;

4.

Publishers receive (typically) 50% of this as revenue sharing; and

5.

The remaining 50% is added to RTB's liquidity pool.

In the near future it is anticipated that publishers will be given the option to withdraw their earnings immediately and directly via cryptocurrency transfer. RTB believes this feature will provide an additional competitive advantage.

RTB does not issue, mine or lend cryptocurrency, and crypto trading activity is limited to risk management within its treasury holdings.