Company: IPSI
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001213900-25-110820
Chunk: 73

Company: Innovative Payment Solutions, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 1
Chunk 73
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ization of debt discount on convertible debt in the prior year. The current period
funding and debt discount, and consequent amortization thereof, is significantly lower than the prior period.

36

Derivative liability movements

Derivative
liability movements were $(30,657,732) and $6,461,496 for the nine months ended September 30, 2025 and 2024, respectively, an increase
of $37,119,228 or 574.5%. The derivative liability arose primarily due to the revaluation of certain repriced conversion features on convertible
debt and warrants. The share price increased substantially during the current quarter, resulting in a significant movement in the derivative
liability.

Net loss from equity
method investment

Net
loss from equity method investment was $0 and $660 for the nine months ended September 30, 2025 and 2024, respectively, a decrease of
$660 or 100.0%. No further expense is being incurred on the Joint Venture, in the prior period expenses were minimal and administrative
in nature.

Deemed dividend

Deemed
dividend was $1,814,511 and $426,807 for the nine months ended September 30, 2025 and 2024, respectively, an increase of $1,387,704 or
325.1%. The deemed dividend in the current and the prior period related to the repricing of warrants and convertible debt. The deemed
dividend was recorded as a component of additional paid in capital.

Net loss attributable
to common stockholders

Net
loss was $48,343,936 and $3,284,069 for the nine months ended September 30, 2025 and 2024, respectively, an increase of $45,059,867 or
1,372.1%. The increase is primarily due to the increase in the loss on convertible debt, the increase in the fair value adjustment to
price protected warrants, the negative movement in derivative liabilities and the increase in the deemed dividend expense, offset by the
decrease in general and administrative expenses and the amortization of debt discount, discussed in detail above.

Liquidity and Capital Resources

To
date, our primary sources of cash have been funds raised primarily from the sale of our debt and equity securities.

We have an accumulated deficit
of $111.1 million through September 30, 2025 and incurred negative cash flow from operations of $0.5 million for the nine months ended