10-Q 1 form10-q.htm 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2025

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ___________

Commission file number 001-40130

Brand Engagement Network Inc.

(Exact name of registrant as specified in its charter)

Delaware		98-1574798
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

300 Delaware Ave Suite 210 Wilmington, DE		19801
(Address of Principal Executive Offices)		(Zip Code)

(650) 714-2747

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.0001 per share	BNAI	The Nasdaq Stock Market LLC
Redeemable Warrants, each whole warrant exercisable for one share of Common Stock at an exercise price of $11.50 per share	BNAIW	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐

Non-accelerated filer	☒	Smaller reporting company	☒

		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).

Yes ☐ No ☒

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date.

As of September 30, 2025, 44,880,795 shares of the Issuer’s common stock, $0.0001 par value per share, and 10,315,024 public warrants representing the right to acquire one share of the Issuer’s common stock for $11.50, were outstanding.

Table of Contents

		Page
Part I. Financial Information		4
Item 1. Financial Statements		4
Unaudited Condensed Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024		4
Unaudited Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2025 and 2024		5
Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Three and Six Months Ended June 30, 2025 and 2024		6
Unaudited Condensed Consolidated Statement of Cash Flows For the Six Months Ended June 30, 2025 and 2024		7
Notes to Unaudited Condensed Consolidated Financial Statements		8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		24
Item 3. Quantitative and Qualitative Disclosures About Market Risk		33
Item 4. Controls and Procedures		33
Part II. Other Information		35
Item 1. Legal Proceedings		35
Item 1A. Risk Factors		35
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		35
Item 3. Defaults Upon Senior Securities		35
Item 4. Mine Safety Disclosures		35
Item 5. Other Information		35
Item 6. Exhibits		36
Signatures		37

Brand Engagement Network, BEN, our logo and our other trademarks or service marks appearing in this report are the property of Brand Engagement Network Inc. Trade names, trademarks and service marks of other companies appearing in this report are the property of their respective owners. Solely for convenience, the trademarks, service marks and trade names included in this report are without the ®, ™ or other applicable symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the rights of the applicable licensors to these trademarks, service marks and trade names.

Unless otherwise indicated, “Brand Engagement Network,” “BEN,” “the Company,” “our,” “us,” or “we,” refer to Brand Engagement Network Inc. and its consolidated subsidiaries.

	June 30, 2025			December 31, 2024*
ASSETS
Current assets:
Cash and cash equivalents	$	20,356		$	149,273
Accounts receivable, net of allowance		9,000			30,888
Due from Sponsor		-			3,000
Prepaid expenses and other current assets		1,922,645			1,042,398
Total current assets		1,952,001			1,225,559
Property and equipment, net		280,152			292,757
Right of use asset - operating lease		420,062			507,182
Intangible assets, net		14,369,717			16,124,370
TOTAL ASSETS	$	17,021,932		$	18,149,868
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	4,611,776		$	5,995,235
Accrued expenses		2,709,576			4,593,712
Due to related parties		-			693,036
Short-term debt		2,354,306			1,655,080
Convertible note		760,000			1,140,000
Operating lease liability		-			173,497
Total current liabilities		10,435,658			14,250,560
Operating lease liability		366,255			335,766
Warrant liabilities		494,873			919,050
Total liabilities		11,296,786			15,505,376

Commitments and contingencies (Note L)

Stockholders’ equity:
Preferred stock par value $0.0001 per share, 10,000,000 shares authorized, none designated. There are no shares issued or outstanding as of June 30, 2025 or December 31, 2024		—			—
Common stock par value of $0.0001 per share, 750,000,000 shares authorized. As of June 30, 2025 and December 31, 2024, respectively, 43,801,488 and 39,573,988 shares issued and outstanding		4,381			3,957
Additional paid-in capital		55,443,064			49,657,684
Accumulated deficit		(49,722,299	)		(47,017,149	)
Total stockholders’ equity		5,725,146			2,644,492
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY		17,021,932		$	18,149,868

* Derived from audited information

	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
Revenues	$	5,000		$	—		$	15,000		$	49,790
Cost of revenues		—			—			—			—
Gross profit		5,000			—			15,000			49,790
Operating expenses:
General and administrative		1,848,021			5,255,136			5,062,210			11,765,671
Depreciation and amortization		974,889			682,244			1,914,095			799,591
Research and development		7,398			355,565			18,095			606,236
Total operating expenses		2,770,308			6,292,945			6,994,400			13,171,498
Loss from operations		(2,825,308	)		(6,292,945	)		(6,979,400	)		(13,121,708	)
Other income (expenses):
Interest expense		(21,609	)		(19,403	)		(146,651	)		(44,453	)
Interest income		—			114			—			3,232
Gain on debt extinguishment		3,959,054			1,847,992			3,959,054			1,847,992
Change in fair value of warrant liabilities		(190,715	)		1,456,661			424,177			1,395,838
Other		(16,342	)		(42,123	)		37,670			(15,014	)
Other income (expenses), net		3,730,388			3,243,241			4,274,250			3,187,595
Income (loss) before income taxes		905,080			(3,049,704	)		(2,705,150	)		(9,934,113	)
Income taxes		—			—			—			—
Net income (loss)	$	905,080		$	(3,049,704	)	$	(2,705,150	)	$	(9,934,113	)
Net income (loss) per common share- basic and diluted	$	0.02		$	(0.09	)	$	(0.07	)	$	(0.34	)
Weighted-average common shares - basic and diluted		42,166,121			33,993,867			41,240,177			29,635,857

	Preferred Stock				Common Stock				Additional Paid-in		Accumulated			Total Stockholders’
	Shares		Par Value		Shares		Par Value		Capital		Deficit			Equity
Balance at December 31, 2024		—	$	—		38,168,988	$	3,957	$	49,657,684	$	(47,017,149	)	$	2,644,492
Sale of common stock		—		—		1,186,426		86		1,325,456		—			1,325,542
Stock issued in conversion of convertible notes		—		—		316,666		32		379,968		—			380,000
Stock issued for Standby Equity Purchase Agreement liability		—		—		643,574		64		432,418		—			432,482
Warrant exercises		—		—		787,132		79		1,499,471		—			1,499,550
Stock-based compensation, including vested restricted shares		—		—		223,586		22		374,904		—			374,926
Stock issued in settlement of liabilities		—		—		588,026		59		265,435		—			265,494
Net loss		—		—		—		—		—		(3,610,230	)		(3,610,230	)
Balance at March 31, 2025		—		—		41,914,398		4,299		53,935,336		(50,627,379	)		3,312,256
Stock-based compensation, including vested restricted shares		—		—		—		—		128,839		—			128,839
Warrant exercises		—		—		25,510		3		49,997		—			50,000
Issuance of common shares		—		—		786,580		79		1,328,892		—			1,328,971
Net income		—		—		—		—		—		905,080			905,080
Balance at June 30, 2025		—	$	—		42,726,488	$	4,381	$	55,443,064	$	(49,722,299	)	$	5,725,146

	Preferred Stock				Common Stock				Additional Paid-in			Accumulated			Total Stockholders’
	Shares		Par Value		Shares		Par Value		Capital			Deficit			Equity
Balance at December 31, 2023		—	$	—		23,270,404	$	2,327	$	30,993,846		$	(13,301,720	)	$	17,694,453
Stock issued to DHC shareholders in reverse recapitalization		—		—		7,885,220		789		(10,722,277	)		—			(10,721,488	)
Issuance of common stock pursuant to Reseller Agreement		—		—		1,750,000		175		13,474,825			—			13,475,000
Sale of common stock		—		—		645,917		65		6,324,935			—			6,325,000
Warrant exercises		—		—		40,514		4		15,260			—			15,264
Stock-based compensation		—		—		—		—		698,705			—			698,705
Net loss		—		—		—		—		—			(6,884,409	)		(6,884,409	)
Balance at March 31, 2024		—	$	—		33,592,055	$	3,360	$	40,785,294		$	(20,186,129	)	$	20,602,525
Stock issued in settlement of accounts payable and loans payable		—		—		93,333		9		321,999			—			322,008
Sale of common stock		—		—		877,500		198		1,993,552			—			1,993,750
Warrant exercises		—		—		13,505		1		4,999			—			5,000
Stock-based compensation, including vested restricted shares		—		—		381,915		42		768,497			—			768,539
Net loss		—		—		—		—		—			(3,049,704	)		(3,049,704	)
Balance at June 30, 2024		—		—		34,958,308		3,610		43,874,341			(23,235,833	)		20,642,118

	●	Common stock — the fair value of the Company’s Common Stock.

	●	Expected Term — The expected term of employee options with service-based vesting is determined using the “simplified” method, as prescribed in the SEC’s Staff Accounting Bulletin No. 107, whereby the expected life equals the arithmetic average of the vesting term and the original contractual term of the option due to the Company’s lack of sufficient historical data. The expected term of nonemployee options is equal to the contractual term.

	●	Expected Volatility — The Company lacks its own historical stock data. Therefore, it estimates its expected stock volatility based primarily on the historical volatility of a publicly traded set of peer companies.

	●	Risk-Free Interest Rate — The Company bases the risk-free interest rate on the U.S. Treasury yield curve commensurate with the expected term of each option.
	●	Expected Dividend —The Company has never declared or paid any cash dividends on its Common Stock and does not plan to pay cash dividends in the foreseeable future, and, therefore, uses an expected dividend yield of zero in its valuation models.

	Fair value measurement at reporting date using
June 30, 2025	(Level 1)		(Level 2)		(Level 3)
Liabilities:
Warrant liabilities - Public Warrants	$	—	$	310,480	$	—
Warrant liabilities - Private Placement Warrants	$	—	$	184,393	$	—
Total Warrant Liabilities	$	—	$	494,873	$	—

	Fair value measurement at reporting date using
December 31, 2024	(Level 1)		(Level 2)		(Level 3)
Liabilities:
Warrant liabilities - Public Warrants	$	—	$	576,606	$	—
Warrant liabilities - Private Placement Warrants	$	—	$	342,444	$	—
Total Warrant Liabilities	$	—	$	919,050	$	—

	June 30,
	2025		2024
Unvested restricted shares		687,830		35,461
Options		1,386,400		2,508,553
Warrants		16,440,962		22,931,826
Convertible note (as converted)		633,334		1,583,334
Total		19,148,526		27,059,174

	March 14, 2024
Cash and cash equivalents	$	858,292
Due from Sponsor		3,000
Prepaid and other current assets		16,824
Accounts payable		(2,352,328	)
Accrued expenses		(5,782,211	)
Due to related parties		(693,036	)
Warrant liability		(1,913,737	)
Net liabilities assumed	$	(9,863,196	)

	June 30, 2025		December 31, 2024
Security deposits	$	107,226	$	108,441
Cataneo GmbH deposit		550,000		—
Prepaid VAT		15,175		32,468
Prepaid professional fees		514,707		284,081
Prepaid insurance		648,064		567,977
Prepaid other		87,473		49,431
Prepaid expenses and other current assets	$	1,922,645	$	1,042,398

	June 30, 2025			December 31, 2024
Equipment	$	339,090		$	337,856
Furniture		351,286			348,754
Capitalized software		217,003			216,751
Total		907,379			903,361
Accumulated depreciation and amortization		(627,227	)		(610,604	)
Property and equipment, net of accumulated depreciation and amortization	$	280,152		$	292,757

	June 30, 2025
	Gross		Accumulated Amortization			Net
Amortizing intangible assets:
Patent portfolio	$	1,259,864	$	(588,097	)	$	671,767
Developed technology		17,941,538		(4,243,588	)		13,697,950
Total	$	19,201,402	$	(4,831,685	)	$	14,369,717

Years Ending December 31:
2025 (remaining 6 months)	$	1,742,683
2026		3,824,905
2027		3,739,302
2028		3,696,501
2029		1,304,560
Thereafter		61,766
	$	14,369,717

	June 30, 2025		December 31, 2024
Accrued professional fees	$	—	$	2,747,211
Accrued compensation and related expenses		1,396,126		1,730,043
Due to related party		1,147,472		—
Accrued other		65,500		116,458
Accrued interest		100,478		—
Accrued expenses	$	2,709,576	$	4,593,712

	Three Months Ended March 31,
	2024
Expected term		5.0 years
Risk-free interest rate		4.13	%
Dividend yield		0.00	%
Volatility		54.79	%

	Number of Shares		Weighted Average Exercise Price		Weighted Average Grant Date Fair Value		Weighted Average Remaining Contractual Term (in years)
Outstanding as of December 31, 2024		1,386,400	$	4.90	$	2.58		8.59
Outstanding as of June 30, 2025		1,386,400	$	4.90	$	2.58		7.84
Vested and expected to vest as of June 30, 2025		1,386,400	$	4.90	$	2.58		7.84
Exercisable as of June 30, 2025		1,081,300	$	4.44	$	1.31		7.76

	Number of Shares			Weighted Average Grant Date Fair Value
Nonvested at January 1, 2025	—			$—
Granted		223,586		$	1.02
Vested		(223,586	)	$	1.02
Nonvested at June 30, 2025		—		$	—

Years Ending December 31:
2025 (remaining six months)	$	105,041
2026		214,263
2027		145,671
Total future minimum payments		464,975
Less imputed interest		(98,720	)
Present value of lease liabilities	$	366,255

	Three Months Ended June 30,						Increase
	2025			2024			(Decrease)
Revenues	$	5,000		$	-		$	5,000

Operating expenses:
General and administrative		1,848,021			5,255,136			(3,407,115	)
Depreciation and amortization		974,889			682,244			292,645
Research and development		7,398			355,565			(348,167	)
Total operating expenses		2,830,308			6,292,945			(3,462,637	)
Loss from operations		(2,825,308	)		(6,292,945	)		3,467,637
Other income (expenses):
Interest expense		(21,609	)		(19,289	)		(2,320	)
Interest income								-
Change in fair value of warrant liabilities		(190,715	)		1,456,661			(1,647,376	)
Gain (loss) on debt extinguishment		3,959,054			1,847,992			2,111,062
Other		(16,342	)		(42,123	)		25,781
Other income (expenses), net		3,730,388			3,243,241			487,147

Net loss	$	905,080		$	(3,049,704	)	$	3,954,784

Exhibit		Description
2.1#^		Business Combination Agreement and Plan of Reorganization, dated as of September 7, 2023, by and among Brand Engagement Network Inc., BEN Merger Subsidiary Corp., DHC Acquisition Corp and, solely with respect to Section 7.21 and 9.03 thereto, DHC Sponsor, LLC (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on September 8, 2023).

2.2#		Share Purchase and Transfer Agreement, dated October 29, 2024, by and among Brand Engagement Network Inc., Christian Unterseer, CUTV GmbH and CUNEO AG (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K (File No. 001-40130) filed with the Securities and Exchange Commission on October 30, 2024).

2.3		Addendum to Share Purchase and Transfer Agreement, dated October 29, 2024, by and among Brand Engagement Network Inc., Christian Unterseer, CUTV GmbH and CUNEO AG (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K (File No. 001-40130) filed with the Securities and Exchange Commission on February 12, 2025).

2.4		Addendum II to Share Purchase and Transfer Agreement, dated May 26, 2025, by and among Brand Engagement Network Inc., Christian Unterseer, CUTV GmbH and CUNEO AG (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K (File No. 001-40130) filed with the Securities and Exchange Commission on May 30, 2025).

3.1		Certificate of Incorporation of Brand Engagement Network Inc. (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K (File No. 001-40130) filed with the Securities and Exchange Commission on March 20, 2024).

3.2		Bylaws of Brand Engagement Network Inc. (incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K (File No. 001-40130) filed with the Securities and Exchange Commission on March 20, 2024).

10.1		Line of Credit Agreement, dated June 5, 2025, by and among Brand Engagement Network Inc. and Corps Capital Advisors LLC (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (File No. 001-40130) filed with the Securities and Exchange Commission on June 10, 2025).

31.1*		Certification of Principal Executive Officer in accordance with 18 U.S.C. Section 1350, as adopted by Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*		Certification of Principal Financial Officer in accordance with 18 U.S.C. Section 1350, as adopted by Section 302 of the Sarbanes-Oxley Act of 2002.

32.1**		Certification of Principal Executive Officer in accordance with 18 U.S.C. Section 1350, as adopted by Section 906 of the Sarbanes-Oxley Act of 2002.

32.2**		Certification of Principal Financial Officer in accordance with 18 U.S.C. Section 1350, as adopted by Section 906 of the Sarbanes-Oxley Act of 2002.

101*		The following financial information from Brand Engagement Network Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2025 formatted in Inline XBRL (Extensible Business Reporting Language) includes: (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Operations, (iii) the Condensed Consolidated Statements of Changes in Stockholders’ Equity, (iv) the Condensed Consolidated Statements of Cash Flows, and (v) Notes to the Condensed Consolidated Financial Statements.

101.INS*		Inline XBRL Instance Document.

101.SCH*		Inline XBRL Taxonomy Extension Schema Document.

101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB*		Inline XBRL Taxonomy Extension Labels Linkbase Document.

101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document.

104*		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

	Brand Engagement Network Inc. (Registrant)

Date: October 10, 2025	By:	/s/ Tyler Luck
	Name:	Tyler Luck
	Title:	Acting Chief Executive Officer
		(Duly Authorized Officer and Principal Executive Officer)

Date: October 10, 2025	By:	/s/ Walid Khiari
	Name:	Walid Khiari
	Title:	Chief Financial Officer
		(Principal Financial Officer)

SEC Form 10-Q filed by Brand Engagement Network Inc.