Company: KWIK
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001683168-25-008410
Chunk: 2

Company: KwikClick, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Item 8
Chunk 2
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, and rebates. Revenue excludes
any amounts collected on behalf of third parties and indirect taxes.

A description of the Company’s revenue generating
activities is as follows:

Third-Party Seller Services (Brand Services
Revenue):

The Company offers programs that provide sellers
a software platform to sell their products. For some contracts the Company provides payment processing and order fulfillment facilitation.
The Company is not the seller of record in these transactions and acts as an agent in the facilitation of the transaction, recognizing
the net revenue as our processing fee. For other contracts, the Company provides a more robust promotional and campaign management service
whereby the Company controls discounts, rebates, commission rates and cross-selling features to the seller. Under this arrangement the
Company invoices for the “incentive budget” from which these services are funded and for which the Company recognizes gross
revenue acting as principal in this transaction.

The Company generally determines stand-alone revenue
based on a percentage of the prices charged by the seller to deliver products sold. The commissions and any related fulfillment, shipping,
and transaction processing fees the Company earns from these arrangements are recognized when the services are rendered, which generally
occurs upon delivery of the related products to a third-party carrier or to the product purchaser. The Company generally does not incur
material costs in obtaining third party seller contracts.

     8 

Custom Design Services

The Company provides custom-brand programming
services in which it builds features for the third-party sellers. Such services often include building a shopping cart integration, revised
or updated affiliate commission tracking system, and reporting functionality. These custom programming features, when built by the Company,
are designed to integrate into the Company’s software platform; however, the custom design features can be used without the Company’s
platform. The Company has determined custom design services are distinct in the context of the contract as the customer can benefit from
the custom design services on its own as the features do not require the Company’s software platform for the customer to derive
value, and they are separately identifiable promises in the contract. These custom design services are performed over a specified term
for a fixed monthly fee. Revenue under these arrangements is recognized ratably over the custom design period, which generally is the
contract term. Additionally, the customer simultaneously receives and consumes the benefit provided by the Company as the performance
of the custom design services enhances and/or creates assets that the customer controls, while the assets are being enhanced or created
– i.e. the features enhanced or created by the