# EDGAR Filing Document

**Accession Number:** 0000722572
**File Stem:** 0001683168-25-008378
**Filing Date:** 2025-11
**Character Count:** 121039
**Document Hash:** 789821416fa0f45ee4e0a3b6b83cb32c
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001683168-25-008378.hdr.sgml**: 20251114

**ACCESSION NUMBER**: 0001683168-25-008378

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 61

**CONFORMED PERIOD OF REPORT**: 20250930

**FILED AS OF DATE**: 20251114

**DATE AS OF CHANGE**: 20251114

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** FRANKLIN WIRELESS CORP
- **CENTRAL INDEX KEY:** 0000722572
- **STANDARD INDUSTRIAL CLASSIFICATION:** TELEPHONE & TELEGRAPH APPARATUS [3661]
- **ORGANIZATION NAME:** 04 Manufacturing
- **EIN:** 953733534
- **STATE OF INCORPORATION:** NV
- **FISCAL YEAR END:** 0630

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-14891
- **FILM NUMBER:** 251481839

**BUSINESS ADDRESS:**
- **STREET 1:** 3940 RUFFIN ROAD
- **STREET 2:** SUITE C
- **CITY:** SAN DIEGO
- **STATE:** CA
- **ZIP:** 92123
- **BUSINESS PHONE:** 858-623-0000

**MAIL ADDRESS:**
- **STREET 1:** 3940 RUFFIN ROAD
- **STREET 2:** SUITE C
- **CITY:** SAN DIEGO
- **STATE:** CA
- **ZIP:** 92123

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** FRANKLIN TELECOMMUNICATIONS CORP
- **DATE OF NAME CHANGE:** 19920703

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** ABM COMPUTER SYSTEMS
- **DATE OF NAME CHANGE:** 19870317

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** AUTOMATED BUSINESS MACHINES INC
- **DATE OF NAME CHANGE:** 19830802

?xml version='1.0' encoding='ASCII'? FRANKLIN WIRELESS CORP. 10-Q

[**Table of Contents**](#q1_001)

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, DC 20549**

**FORM 10-Q**

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

**For the quarterly period ended September 30, 2025**

**OR**

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

**For the transition period from &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; to &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.**

**Commission file number: 001-14891**

**FRANKLIN WIRELESS CORP.**

(Exact name of Registrant as specified in its charter)

---

| | |
|:---|:---|
| **Nevada**<br> (State or other jurisdiction of incorporation or organization) | **95-3733534**<br> (I.R.S. Employer Identification Number) |
| <br> **3940 Ruffin Road** <br> **Suite C**<br> **San Diego, California**<br> (Address of principal executive offices) | <br> **92123**<br> (Zip code)<br>|

---

**(858) 623-0000**

Registrant's telephone number, including area code

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, if any, 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 has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. Yes ☐ No ☒

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

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 $.001 per share | FKWL | The Nasdaq Stock Market LLC |

---

The Registrant has 11,784,280 shares of common stock outstanding as of November 14, 2025.

**FRANKLIN WIRELESS CORP.**

**FORM 10-Q**

**FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2025**

**INDEX**

---

| | | |
|:---|:---|:---|
|  |  | **Page** |
| [**PART I – Financial Information**](#q1_002) | [**PART I – Financial Information**](#q1_002) | [**PART I – Financial Information**](#q1_002) |
| Item 1: | [Consolidated Financial Statements (unaudited)](#q1_003) | **4** |
|  | [Consolidated Balance Sheets as of September 30, 2025 (unaudited) and June 30, 2025](#q1_004) | **4** |
|  | [Consolidated Statements of Comprehensive Income (unaudited) for the three months ended September 30, 2025 and 2024](#q1_005) | **5** |
|  | [Consolidated Statements of Stockholders' Equity (unaudited) for the three months ended September 30, 2025 and 2024](#q1_006) | **6-7** |
|  | [Consolidated Statements of Cash Flows (unaudited) for the three months ended September 30, 2025 and 2024](#q1_007) | **8** |
|  | [Notes to Consolidated Financial Statements](#q1_008) | **9** |
| Item 2: | [Management's Discussion and Analysis of Financial Condition and Results of Operations](#q1_009) | **30** |
| Item 3: | [Quantitative and Qualitative Disclosures About Market Risk](#q1_010) | **34** |
| Item 4: | [Controls and Procedures](#q1_011) | **34** |
| [**PART II – Other Information**](#q1_012) | [**PART II – Other Information**](#q1_012) | [**PART II – Other Information**](#q1_012) |
| Item 1: | [Legal Proceedings](#q1_013) | **35** |
| Item 1A: | [Risk Factors](#q1_014) | **35** |
| Item 2: | [Unregistered Sales of Equity Securities and Use of Proceeds](#q1_015) | **35** |
| Item 3: | [Defaults Upon Senior Securities](#q1_016) | **35** |
| Item 4: | [Mine Safety Disclosures](#q1_017) | **35** |
| Item 5: | [Other Information](#q1_018) | **35** |
| Item 6: | [Exhibits](#q1_019) | **35** |
| [Signatures](#q1_020) | [Signatures](#q1_020) | **36** |

---

**NOTE ON FORWARD LOOKING STATEMENTS**

You should keep in mind the following points as you read this Report on Form 10-Q:

The terms "we," "us," "our," "Franklin," "Franklin Wireless," or the "Company" refer to Franklin Wireless Corp.

This Report on Form 10-Q contains statements which, to the extent they do not recite historical fact, constitute "forward looking" statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward looking statements are used under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operation," and elsewhere in this Quarterly Report on Form 10-Q. You can identify these statements by the use of words like "may," "will," "could," "should," "project," "believe," "anticipate," "expect," "plan," "estimate," "forecast," "potential," "intend," "continue," and variations of these words or comparable words. Forward looking statements do not guarantee future performance and involve risks and uncertainties. Actual results may differ substantially from the results that the forward looking statements suggest for various reasons, including those discussed under the caption "Risk Factors" in Item 1A of our Annual Report on Form 10-K for the year ended June 30, 2025. These forward looking statements are made only as of the date of this Report on Form 10-Q. We do not undertake to update or revise the forward looking statements, whether as a result of new information, future events or otherwise.

**PART I – FINANCIAL INFORMATION**

**ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS**

**FRANKLIN WIRELESS CORP.**

**Consolidated Balance Sheets**

---

| | | |
|:---|:---|:---|
|  | **September 30, 2025**<br> **(Unaudited)** | **June 30, 2025** |
| **ASSETS** |  |  |
| &nbsp;&nbsp;&nbsp;**Current assets:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $13380124 | $14741173 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Short-term investments | 25334511 | 25887028 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable, net | 6782714 | 1330504 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other receivable due from officer | 662596 | 662596 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories, net | 995364 | 2358335 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other current assets | 126484 | 143666 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Advance payments to vendors | 110737 | 56988 |
| **Total current assets** | 47392530 | 45180290 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Property and equipment, net | 60545 | 72882 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Intangible assets, net | 865648 | 1014112 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred tax assets, non-current | 3273622 | 3273622 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Goodwill | 273285 | 273285 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Right of use assets, net | 1288492 | 1382294 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other assets | 130363 | 133545 |
| **TOTAL ASSETS** | $**53284485** | $**51330030** |
| **LIABILITIES AND STOCKHOLDERS' EQUITY** |  |  |
| &nbsp;&nbsp;&nbsp;**Current liabilities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | $9620211 | $8119055 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract liabilities and advance from customers | 115920 | 125300 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income tax payable | 30870 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued liabilities, bonus payable to an officer | 2750000 | 2625000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued liabilities, others | 1114897 | 1172044 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lease liabilities, current | 371550 | 375343 |
| &nbsp;&nbsp;&nbsp;**Total current liabilities** | 14003448 | 12416742 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lease liabilities, non-current | 922958 | 1018985 |
| **Total liabilities** | 14926406 | 13435727 |
| &nbsp;&nbsp;&nbsp;**Commitments and contingencies (Note 6)** | **–** | **–** |
| &nbsp;&nbsp;&nbsp;**Stockholders' equity:** |  |  |
| &nbsp;&nbsp;&nbsp;**Parent Company stockholders' equity** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Preferred stock, par value $0.001 per share, authorized 10,000,000 shares; <br> none issued and outstanding |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Common stock, par value $0.001 per share, authorized 50,000,000 shares; 11,784,280 shares issued and outstanding | 14263 | 14263 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Additional paid-in capital | 14337826 | 14337826 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Retained earnings | 25534586 | 24894108 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Treasury stock, 2,549,208 shares | (3554893) | (3554893) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accumulated other comprehensive loss | (1204421) | (1146862) |
| &nbsp;&nbsp;&nbsp;**Total Parent Company stockholders' equity** | 35127361 | 34544442 |
| &nbsp;&nbsp;&nbsp;Non-controlling interests | 3230718 | 3349861 |
| &nbsp;&nbsp;&nbsp;**Total stockholders' equity** | 38358079 | 37894303 |
| **TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY** | $**53284485** | $**51330030** |

---

The accompanying notes are an integral part of these consolidated financial statements.

**FRANKLIN WIRELESS CORP.**

**Consolidated Statements of Comprehensive Income** 

**(Unaudited)**

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended <br> September 30,** | **Three Months Ended <br> September 30,** |
|  | **2025** | **2024** |
| Net sales | $12744960 | $13322912 |
| Cost of goods sold | (9835190) | (11251410) |
| Gross profit | 2909770 | 2071502 |
| Operating expenses: |  |  |
| &nbsp;&nbsp;&nbsp;Selling, general and administrative | 1369638 | 1419973 |
| &nbsp;&nbsp;&nbsp;Research and development | 949752 | 1024312 |
| Total operating expenses | 2319390 | 2444285 |
| Income (loss) from operations | 590380 | (372783) |
| Other income, net: |  |  |
| &nbsp;&nbsp;&nbsp;Interest income | 151626 | 181804 |
| &nbsp;&nbsp;&nbsp;Gain from the forgiveness of accrued liabilities | 15650 | 247592 |
| &nbsp;&nbsp;&nbsp;(Loss) gain from foreign currency transactions | (290870) | 451947 |
| &nbsp;&nbsp;&nbsp;Other income, net | 126398 | 187976 |
| Total other income, net | 2804 | 1069319 |
| Income before provision for income taxes | 593184 | 696536 |
| Income tax provision | 42648 | 47880 |
| **Net Income** | **550536** | **648656** |
| Less: noncontrolling interests in net (loss) income of subsidiary at 33.7% | (105164) | 133469 |
| Less: noncontrolling interests in net income of subsidiary at 40.0% | 15222 | – |
| **Net Income attributable to Parent Company** | $**640478** | $**515187** |
| Earnings per share attributable to Parent Company stockholders - basic | $0.05 | $0.04 |
| Earnings per share attributable to Parent Company stockholders - diluted | $0.05 | $0.04 |
| Weighted average common shares outstanding - basic | 11784280 | 11784280 |
| Weighted average common shares outstanding - diluted | 11803465 | 11807962 |
| Comprehensive income |  |  |
| &nbsp;&nbsp;&nbsp;Net income | $550536 | $648656 |
| &nbsp;&nbsp;&nbsp;Translation adjustments | (86760) | 128124 |
| Comprehensive income | 463776 | 776780 |
| Less: comprehensive (loss) income attributable to non-controlling interest | (89942) | 133469 |
| Less: foreign exchange translation attributable to non-controlling interest | (29201) | 43124 |
| **Comprehensive income attributable to controlling interest** | $**582919** | $**600187** |

---

The accompanying notes are an integral part of these consolidated financial statements.

**FRANKLIN WIRELESS CORP.**

**Consolidated Statements of Changes in Stockholders' Equity** 

**For the Three Months Ended September 30, 2025 (Unaudited)**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Common Stock** | **Common Stock** | | | | | | |
|  | **Shares** | **Amount** | **Additional<br> Paid-in**<br>**Capital** | **Retained**<br>**Earnings** | **Treasury**<br>**Stock** | **Accumulated Other Comprehensive**<br>**Loss** | **Non- <br> controlling**<br>**Interest** | **Total Stockholders**<br>**Equity** |
| **Balance - June 30, 2025** | **11784280** | $**14263** | $**14337826** | $**24894108** | $**(3554893)** | $**(1146862)** | $**3349861** | $**37894303** |
| Net income attributable to Parent Company |  |  |  | 640478 |  |  |  | 640478 |
| Foreign exchange translation |  |  |  |  |  | (57559) | (29201) | (86760) |
| Comprehensive loss attributable to non-controlling interest | – | – | – | – | – | – | (89942) | (89942) |
| **Balance – September 30, 2025 (unaudited)** | **11784280** | $**14263** | $**14337826** | $**25534586** | $**(3554893)** | $**(1204421)** | $**3230718** | $**38358079** |

---

The accompanying notes are an integral part of these consolidated financial statements.

**FRANKLIN WIRELESS CORP.**

**Consolidated Statements of Changes in Stockholders' Equity** 

**For the Three Months Ended September 30, 2024 (Unaudited)**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Common Stock** | **Common Stock** | | | | | | |
|  | **Shares** | **Amount** | **Additional<br> Paid-in**<br>**Capital** | **Retained**<br>**Earnings** | **Treasury**<br>**Stock** | **Accumulated Other Comprehensive Income**<br>**(Loss)** | **Non- controlling**<br>**Interest** | **Total Stockholders**<br>**Equity** |
| **Balance – June 30, 2024** | **11784280** | $**14263** | $**14733300** | $**25137209** | $**(3554893)** | $**(1182825)** | $**1228944** | $**36375998** |
| Net income attributable to Parent Company |  |  |  | 515187 |  |  |  | 515187 |
| Foreign exchange translation |  |  |  |  |  | 85000 | 43124 | 128124 |
| Comprehensive income attributable to non-controlling interest |  |  |  |  |  |  | 133469 | 133469 |
| Stock based compensation | – | – | 87384 | – | – | – | – | 87384 |
| **Balance – September 30, 2024 <br> (unaudited)** | **11784280** | $**14263** | $**14820684** | $**25652396** | $**(3554893)** | $**(1097825)** | $**1405537** | $**37240162** |

---

The accompanying notes are an integral part of these consolidated financial statements.

**FRANKLIN WIRELESS CORP.**

**Consolidated Statements of Cash Flows (Unaudited)**

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended** <br> **September 30,** | **Three Months Ended** <br> **September 30,** |
|  | **2025** | **2024** |
| **CASH FLOW FROM OPERATING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;Net income | $550536 | $648656 |
| Adjustments to reconcile net income to net cash (used in) provided by operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;Depreciation | 8243 | 7859 |
| &nbsp;&nbsp;&nbsp;Amortization of intangible assets | 198296 | 253995 |
| &nbsp;&nbsp;&nbsp;Loss (gain) from foreign currency transactions | 329972 | (512311) |
| &nbsp;&nbsp;&nbsp;Stock based compensation |  | 87384 |
| &nbsp;&nbsp;&nbsp;Forgiveness of debts | (15650) | (247592) |
| &nbsp;&nbsp;&nbsp;Net change of right use assets and lease liabilities | (6018) | (5843) |
| &nbsp;&nbsp;&nbsp;Deferred tax benefit |  | 47080 |
| &nbsp;&nbsp;&nbsp;Change in assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable | (5487322) | (634081) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories | 1358115 | (1127477) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other current assets | 15387 | 75735 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Advance payments to vendors | (56180) | (64493) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | 1521184 | 3550907 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract liabilities and advance from customers | (9380) | 11580 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income tax payable | 30870 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued liabilities | 73039 | 579501 |
| Net cash (used in) provided by operating activities | (1488908) | 2670900 |
| **CASH FLOW FROM INVESTING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;Proceeds (purchases) of short-term investments | 197386 | (291869) |
| &nbsp;&nbsp;&nbsp;Purchases of property and equipment | (904) | (21544) |
| &nbsp;&nbsp;&nbsp;Payments for capitalized product development costs and intangible assets | (53167) | (21372) |
| Net cash provided by (used in) investing activities | 143315 | (334785) |
| Effect of foreign currency translation | (15456) | 15391 |
| Net (decrease) increase in cash and cash equivalents | (1361049) | 2351506 |
| Cash and cash equivalents, beginning of year | 14741173 | 12266556 |
| Cash and cash equivalents, end of year | $13380124 | $14618062 |
| **Supplemental disclosure of cash flow information:** |  |  |
| &nbsp;&nbsp;&nbsp;Cash paid during the periods for: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income taxes | $(41400) | $(800) |

---

The accompanying notes are an integral part of these consolidated financial statements.

**FRANKLIN WIRELESS CORP.** 

**NOTES TO CONSOLIDATED FINANCIAL STATEMENTS**

**(Unaudited)**

**NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

This summary of significant accounting policies of the Company is presented to assist in understanding the Company's consolidated financial statements. The consolidated financial statements and notes are representations of the Company's management, which is responsible for their integrity and objectivity. These accounting policies conform to GAAP and have been consistently applied in the preparation of the consolidated financial statements.

**Principles of Consolidation**

As of September 30, 2025, the consolidated financial statements include the accounts of the Company and its subsidiaries, Franklin Technology Inc. ("FTI") and Sigbeat Inc. ("Sigbeat"), with majority voting interests of approximately 66.3% and 60.0%, respectively, (approximately 33.7% and 40.0% are owned by noncontrolling interests, respectively). As of September 30, 2024, the consolidated financial statements include the accounts of the Company and its subsidiary, FTI, with a majority voting interest of 66.3% (approximately 33.7% is owned by noncontrolling interests). In the preparation of consolidated financial statements of the Company, intercompany transactions and balances are eliminated and net earnings (loss) are reduced by the portion of the net earnings (loss) of the subsidiary or subsidiaries applicable to noncontrolling interests.

On May 14, 2024, the Company entered into an Agreement for Formation of a Joint Venture Corporation (the "Agreement"). Under the terms of the Agreement, the parties formed a Nevada corporation, Sigbeat, to be owned 60% by Franklin and 40% by its Electronic Manufacturing Services ("EMS") partner, Forge International Co., Ltd. ("Forge"). The parties contributed a total of $5,000,000 in capital, in accordance with their respective ownership interest percentages. Under the terms of the Agreement, Sigbeat has a Board of Directors consisting of three members, of whom two are to be appointed by the Company and one appointed by Forge. Sigbeat will engage in worldwide sales, marketing, customer support and operations for telecommunications modules under such brands or designations as the Board of Directors of Sigbeat determines.

Pursuant to the Agreement, in July 2024, Sigbeat entered into a stock subscription agreement with Forge to purchase 400,000 shares of Common Stock, representing 40% of the total outstanding Common Stock of Sigbeat. On December 23, 2024, and January 9, 2025, the Company contributed $600,000 and $2,400,000 for Common Stock, respectively, and, on January 16, 2025, Forge contributed $2,000,000 for Common Stock.

**Reclassifications**

Certain amounts on the prior period's consolidated financial statements were regrouped and reclassified to conform to current-year presentation, with no effect on total stockholders' equity.

**Non-controlling Interest in Consolidated Subsidiary**

As of September 30, 2025, the Non-Controlling Interest ("NCI") totaled $3,230,718, representing a $119,143 net decrease from the $3,349,861 balance as of June 30, 2025. The net decrease of $119,143 is broken down by subsidiary for the three months ended September 30, 2025, as follows:

The NCI in FTI decreased by ($134,365), and the decrease was comprised of the following two items:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o ($105,164) attributable to FTI's net loss of ($312,455) for the period.

o ($29,201) attributable to foreign currency translation adjustments for the period.

The NCI in Sigbeat increased by $15,222, attributable to Sigbeat's net income of $38,054 for the period.

As of September 30, 2024, the NCI was $1,405,537, which represents a $176,593 increase from $1,228,944 as of June 30, 2024. The increase of $176,593 in the NCI consists of $133,469 from income in the subsidiary of $396,552 and $43,124 from foreign exchange translation incurred for the three months ended September 30, 2024.

**Segment Reporting**

Accounting Standards Codification ("ASC") 280, "Segment Reporting," requires public companies to report financial and descriptive information about their reportable operating segments. We identify our operating segments based on how our chief operating decision maker internally evaluates separate financial information, business activities and management responsibility. We have one reportable segment, consisting of the sale of wireless access products. The Chief Operating Decision Maker ("CODM") assesses performance for the segment and allocates resources based on the consolidated net income (loss) of the company. The CODM uses the consolidated net income (loss) to evaluate the return on assets in deciding on resource allocation, monitor performance against budgets, and benchmark performance against competitors.

We generate revenues from two geographic areas, consisting of North America and Asia. The following enterprise-wide disclosure is prepared on a basis consistent with the preparation of the consolidated financial statements. The following table contains certain financial information by geographic area and a reconciliation of total revenues and significant expenses by geographic area to the Company's measure of net income (loss).

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended**<br> **September 30,** | **Three Months Ended**<br> **September 30,** |
| **Net sales:** | **2025** | **2024** |
| North America | $12733051 | $13322448 |
| Asia | 11909 | 464 |
| **Totals** | $**12744960** | $**13322912** |

---

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended**<br> **September 30,** | **Three Months Ended**<br> **September 30,** |
| **Items:** | **2025** | **2024** |
| Net sales | $12744960 | $13322912 |
| Cost of goods sold | (9835190) | (11251410) |
| Selling, general, and administrative expenses | (1369638) | (1419973) |
| Research and development expenses | (949752) | (1024312) |
| Other segment items | (39844) | 1021439 |
| **Net loss** | $**550536** | $**648656** |

---

---

| | | |
|:---|:---|:---|
| **Long-lived assets, net (property and equipment and intangible assets):** | **September 30, 2025** | **June 30, 2025** |
| North America | $783174 | $929173 |
| Asia | 143019 | 157821 |
| **Totals** | $**926193** | $**1086994** |

---

**Fair Value of Financial Instruments**

Fair value accounting is applied for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the consolidated financial statements on a recurring basis (at least annually). Assets and liabilities recorded at fair value in the financial statements are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels, which are directly related to the amount of subjectivity, associated with the inputs to the valuation of these assets or liabilities are as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Level 1 – Observable inputs, such as unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date.

· Level 2 – Observable inputs other than Level 1 quoted prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

· Level 3 – Unobservable inputs that cannot be directly corroborated by observable market data and that typically reflect management's estimate of assumptions that market participants would use in pricing the asset or liability.

The carrying amounts of financial instruments such as cash equivalents, short-term investments, accounts receivable, other current assets, accounts payable, and accrued liabilities approximate the related fair values due to the short-term nature of these instruments. We invest our excess cash into financial instruments which are readily convertible into cash, such as money market funds and certificates of deposit.

**Use of Estimates** 

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and 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 materially differ from those estimates.

**Allowance for Doubtful Accounts**

On July 1, 2023, we adopted ASU 2016-13 Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which replaces the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss ("CECL") methodology. The measurement of expected credit losses under the CECL methodology is applicable to financial assets measured at amortized cost, including loan receivables and held to maturity debt securities. It also applies to Off-Balance Sheet ("OBS") credit exposures not accounted for as insurance (loan commitments, standby letters of credit, financial guarantees, and other similar instruments) and net investments and leases recognized by a lessor in accordance with Topic 842 on leases. Upon adoption of ASC 326 and based upon our review of historical collections and current receivable balances, the Company determined that no additional allowance for doubtful accounts was required for the three months ended September 30, 2025 and 2024. The allowance for doubtful accounts remained $158,400 as of September 30, 2025, and June 30 ,2025.

**Cash Flows Reporting**

We follow ASC 230, Statements of Cash Flows, which requires that cash receipts and payments be classified as operating, investing, or financing activities and provides definitions for each category. We use the indirect or reconciliation method ("Indirect method") as defined by ASC 230. Under this method, net income is adjusted for the effects of non-cash transactions, deferrals or accruals of past or future operating cash receipts and payments, and items classified as investing or financing cash flows.

**Related Parties**

We follow ASC 850, "Related Party Disclosures," for the identification of related parties and disclosure of related party transactions. Related parties are any entities or individuals that, through employment, ownership or other means, possess the ability to direct or cause the direction of our management and policies of the Company. (Refer to NOTE 10–RELATED PARTY TRANSACTIONS)

**Foreign Currency Translations**

We have a majority-owned subsidiary in a foreign country, South Korea. Fluctuations in foreign currency impact the amount of total assets, liabilities, earnings and cash flows that we report for our foreign subsidiary upon the translation of these amounts into U.S. Dollars for, and as of the end of, each reporting period. In particular, the strengthening of the U.S. Dollar generally will reduce the reported amount of our foreign-denominated cash, cash equivalents, total revenues and total expense that we translate into U.S. Dollars and report in our consolidated financial statements for, and as of the end of, each reporting period. However, a majority of our consolidated revenue is denominated in U.S. Dollars, and therefore, our revenue is not directly subject to foreign currency risk.

In accordance with ASC 830, when an operation has transactions denominated in a currency other than its functional currency, they are measured in the functional currency. Changes in the expected functional currency cash flows caused by changes in exchange rates are included in net income (loss) for the period.

**Leases**

In accordance with ASC 842, we determine whether an arrangement contains a lease at inception. A lease is a contract that provides the right to control an identified asset for a period of time in exchange for consideration. For identified leases, we determine whether it should be classified as an operating or finance lease. Operating leases are recorded in the balance sheet as right-of-use asset ("ROU asset") and operating lease obligation. ROU assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payment arising from the lease ROU assets and operating lease liabilities are recognized at the commencement date of the lease and measured based on the present value of lease payment over the lease term. The ROU asset also includes deferred rent liabilities. Our lease arrangements generally do not provide an implicit interest rate. As a result, in such situations, we use its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. We include options to extend or terminate the lease when it is reasonably certain that it will exercise that option in the measurement of its ROU assts and liabilities.

Lease expense for operating leases is recognized on a straight-line basis over the lease term. We are also electing not to apply the recognition requirements to short-term leases of twelve months or less and instead will recognize lease payments as expense on a straight-line basis over the lease term.

**Revenue Recognition** 

The Company accounts for its revenue according to ASC 606, "Revenue from Contracts with Customers", pursuant to which, revenue is recognized when the control of the promised goods or services is transferred to the customers, and the performance obligations under the contract have been satisfied, in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

The Company determines revenue recognition through the following steps: (1) identify the contract(s) with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when (or as) the entity satisfies a performance obligation.

*Contracts with Customers*

 

Revenue from sales of products and services is derived from contracts with customers. The products and services promised in contracts primarily consist of hotspot routers. Contracts with each customer generally state the terms of the sale, including the description, quantity and price of each product or service. Payment terms are stated in the contract, primarily in the form of a purchase order. Since the customer typically agrees to a stated rate and price in the purchase order that does not vary over the life of the contract, the majority of our contracts do not contain variable consideration. We establish a provision for estimated warranty and returns. Using historical averages, those provisions for the quarters ended September 30, 2025 and 2024 were not material.

*Disaggregation of Revenue*

In accordance with Topic 606, we disaggregate revenue from contracts with customers into geographical regions and by the timing of when goods and services are transferred. We determined that disaggregating revenue into these categories meets the disclosure objective in Topic 606, which is to depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by regional economic factors.

*Contract Balances*

We perform our obligations under a contract with a customer by transferring products in exchange for consideration from the customer. We typically invoice our customers as soon as control of an asset is transferred, and a receivable is established. We, however, recognize a contract liability when a customer prepays for goods and/or services, or we have not delivered goods under the contract since we have not yet transferred control of the goods and/or services.

The balances of our trade receivables are as follows:

---

| | | |
|:---|:---|:---|
|  | **September 30, 2025** | **June 30, 2025** |
| Accounts Receivable, net | $6782714 | $1330504 |

---

We did not have any un-invoiced receivables for the periods ended September 30, 2025, and June 30, 2025.

Our contract liabilities are as follows:

---

| | | |
|:---|:---|:---|
|  | **September 30, 2025** | **June 30, 2025** |
| Undelivered products | $115920 | $125300 |

---

*Performance Obligations*

 

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of measurement in Topic 606. At contract inception, we assess the products and services promised in our contracts with customers. We then identify performance obligations to transfer distinct products or services to the customer. In order to identify performance obligations, we consider all the products or services promised in the contract regardless of whether they are explicitly stated or are implied by customary business practices.

The majority of our revenue recognized at a point in time is for the sale of hotspot router products. Revenue from these contracts is recognized when the customer is able to direct the use of and obtain substantially all of the benefits from the product, which generally coincides with title transfer at completion of the shipping process.

Revenue from products transferred to customers at a single point in time accounted for 99.4% and 99.9% of net sales for the three months ended September 30, 2025 and 2024. Revenue recognized over a period of time accounted for 0.6% and 0.1% of net sales for the three months ended September 30, 2025 and 2024.

As of September 30, 2025 and 2024, our contracts do not contain any unsatisfied performance obligations, except for undelivered products.

**Cost of Goods Sold** 

All costs associated with our contract manufacturers, as well as distribution, fulfillment and repair services, are included in our cost of goods sold. Cost of goods sold also includes amortization expenses of approximately $189,642 and $245,233 associated with capitalized product development costs associated with complete technology for the three months ended September 30, 2025 and 2024, respectively.

**Capitalized Product Development Costs**

Accounting Standards Codification ("ASC") Topic 350, "Intangibles - Goodwill and Other" includes software that is part of a product or process to be sold to a customer and is accounted for under Subtopic 985-20. Our products contain embedded software internally developed by FTI, which is an integral part of these products because it allows the various components of the products to communicate with each other and the products are clearly unable to function without this coding.

The costs of product development that are capitalized once technological feasibility is determined (noted as technology in progress in the Intangible Assets table in NOTE 4-INTANGIBLE ASSETS, NET) include related licenses, certification costs, payroll, employee benefits, and other headcount-related expenses associated with product development. We determine that technological feasibility for our products is reached after all high-risk development issues have been resolved. Once the products are available for general release to our customers, we cease capitalizing the product development costs and any additional costs, if any, are expensed. The capitalized product development costs are amortized on a product-by-product basis using the straight-line amortization. The amortization begins when the products are available for general release to our customers.

As of September 30, 2025, and June 30, 2025, capitalized product development costs in progress were $63,303 and $452,676, respectively, and are included in intangible assets in our consolidated balance sheets. During the three months ended September 30, 2025, and 2024, we incurred $47,178 and $14,000, respectively, in capitalized product development costs, and such amounts are primarily comprised of certifications and licenses. All costs incurred before technological feasibility reached are expensed and included in our consolidated statements of comprehensive income.

**Research and Development Costs**

Costs associated with research and development are expensed as incurred. Research and development costs were $949,752 and $1,024,312 for the three months ended September 30, 2025 and 2024, respectively.

**Warranties**

We provide a warranty for one year which is covered by our vendors and manufacturers under purchase agreements between the Company and the vendors. As a result, we believe we do not have any net warranty exposure and do not accrue any warranty expenses. Historically, the Company has not experienced any material net warranty expenditures.

 ****

**Shipping and Handling Costs**

Costs associated with product shipping and handling are expensed as incurred. Shipping and handling costs, which are included in selling, general and administrative expenses on the consolidated statements of comprehensive income (loss), were $188,843 and $78,113 for the three months ended September 30, 2025, and 2024, respectively.

**Cash and Cash Equivalents**

For the purposes of the consolidated balance sheets and the consolidated statements of cash flow, we consider all highly liquid investments purchased with original maturities of three months or less to be cash equivalents.

**Short Term Investments**

We have invested excess funds in short-term liquid assets, such as certificates of deposit or money market funds.

**Inventories, Net**

Our inventories consist of finished goods and are stated at the lower of cost or net realizable value, cost being determined on a first-in, first-out basis. We assess the inventory carrying value and reduce it, if necessary, to its net realizable value based on customer orders on hand, and internal demand forecasts using management's best estimates given information currently available. Our customer demand is highly unpredictable and can fluctuate significantly caused by factors beyond the Company's control. We may write down our inventory value for potential obsolescence and excess inventory. For the three months ended September 30, 2025, and 2024, we recorded no reserve allowances for inventories we have identified as obsolete or slow-moving. As of September 30, 2025, and June 30, 2025, the inventory reserve for obsolete or slow-moving items was $39,322 and $11,114, respectively.

**Property and Equipment, Net**

Property and equipment are recorded at cost. Significant additions or improvements extending the useful lives of assets are capitalized. Expenditures for maintenance and repairs are expensed as incurred. Depreciation is computed using the straight-line method over the estimated useful lives as follows:

---

| | |
|:---|:---|
| Machinery | 6 years |
| Office equipment, including software | 5 years |
| Molds | 3~6 years |
| Vehicles | 5 years |
| Furniture and fixtures | 7 years |
| Facilities improvements | 5 years or life of the lease, whichever is shorter |

---

**Stock-based Compensation**

We account for stock options and other equity-based compensation issued in accordance with ASC 718 "Stock Compensation", which requires the measurement and recognition of compensation expense related to the fair value of equity-based compensation awards that are ultimately expected to vest. Stock-based compensation expense recognized includes the compensation cost for all share-based compensation payments granted to employees and non-employees, net of estimated forfeitures, over the employees' requisite service period or the non-employees' performance period based on the grant date fair value estimated in accordance with the provision of ASC 718. ASC 718 is also applied to awards modified, repurchased, or cancelled during the periods reported.

**Income Taxes**

We use the asset and liability method of accounting for income taxes. Accordingly, deferred tax assets and liabilities are determined based on the difference between the financial statement and income tax bases of assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. A valuation allowance is recorded to reduce the carrying amount of deferred tax assets, unless it is more likely than not such assets will be realized. Current income taxes are based on the year's taxable income for federal and state income tax reporting purposes and the annual change in deferred taxes.

We assess income tax positions and record tax benefits based upon management's evaluation of the facts, circumstances, and information available at the reporting date. For those tax positions where it is more likely than not that a tax benefit will be sustained, we record the largest amount of tax benefit with a greater than 50% likelihood of being realized upon ultimate settlement with a taxing authority having full knowledge of all relevant information. For those income tax positions where it is not more likely than not that a tax benefit will be sustained, no tax benefit is recognized in the financial statements. We classify interest and penalties associated with such uncertain tax positions as a component of income tax expense.

As of September 30, 2025, we have no material unrecognized tax benefits. We recorded income tax provisions of $42,648 and $47,880 for the three months ended September 30, 2025, and 2024, respectively.

For the three months ended September 30, 2025, we recorded an increase of $30,870 in income tax payable in the U.S. and a net increase of $44,008 in the combined prepaid income taxes, respectively. For the three months ended September 30, 2024, we recorded a decrease in deferred tax asset, non-current, of $47,880.

**Concentrations of Credit Risk**

We maintain our cash accounts with established commercial banks in the United States of America (the "U.S.") and Korea. Such cash deposits exceed the Federal Deposit Insurance Corporation insured limit of $250,000 and the Korea Deposit Insurance Corporation insured limit of approximately $71,000 for each financial institution located in the U.S. and Korea, respectively. We have approximately $27 million and $10.9 million in uninsured deposits in the U.S and Korea, respectively, but we do not anticipate any losses on excess deposits.

We extend credit to our customers and perform ongoing credit evaluations of such customers. We evaluate our accounts receivable on a regular basis for collectability and provide an allowance for potential credit losses as deemed necessary. No reserve was required or recorded for any of the periods presented.

Substantially all of our revenues are derived from sales of wireless data products. Any significant decline in market acceptance of our products or in the financial condition of our existing customers could impair our ability to operate effectively.

A significant portion of our revenue is derived from a small number of customers. For the three months ended September 30, 2025, sales to our two largest customers accounted for 90.4% of our consolidated net sales, and 91.6% of our accounts receivable balance as of September 30, 2025. For the three months ended September 30, 2024, sales to our two largest customers accounted for 93.6% of our consolidated net sales, and 71.2% of our accounts receivable balance as of September 30, 2024. No other customers accounted for more than ten percent of total net sales for the three months ended September 30, 2025 and 2024.

For the three months ended September 30, 2025, we purchased the majority of our wireless data products from a manufacturing company located in Asia. If this manufacturing company was to experience delays, capacity constraints or quality control problems, product shipments to our customers could be delayed, or our customers could consequently elect to cancel the underlying product purchase order, which would negatively impact the Company's revenue.

For the three months ended September 30, 2025, we purchased wireless data products from one manufacturer in the amount of $7,553,627, or 93.0% of total purchases, and had related accounts payable of $7,775,439, or 80.8% of our accounts payable balance as of September 30, 2025. For the three months ended September 30, 2024, we purchased wireless data products from two manufacturers in the amount of $11,653,180, or 99.9% of total purchases, and had related accounts payable of $10,186,585, or 94.2% of our accounts payable balance as of September 30, 2024.

**Recently Issued Accounting Pronouncements**

In December 2023, the FASB issued ASU No. 2023-09, Improvements to Income Tax Disclosures (Topic 740). The ASU requires disaggregated information about a reporting entity's effective tax rate reconciliation as well as additional information on income taxes paid. The ASU is effective on a prospective basis for annual periods beginning after December 15, 2024. Early adoption is also permitted for annual financial statements that have not yet been issued or made available for issuance. This ASU will likely result in the required additional disclosures being included in our consolidated financial statements once adopted.

In November 2024, the FASB issued ASU No. 2024-03, Expense Disaggregation Disclosures (Subtopic 220-40). The ASU requires disclosure of specified information about certain costs and expenses. This includes purchases of inventory, employee compensation, depreciation, and intangible asset amortization. The ASU is effective on a prospective or retrospective basis for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. This ASU will likely result in the required additional disclosures being included in our consolidated financial statements, once adopted.

In January 2025, the FASB issued ASU 2025-01, which revises the effective date of ASU 2024-03, "to clarify that all public business entities are required to adopt the guidance in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027." Entities within the ASU's scope are permitted to early adopt the ASU. This ASU will likely result in the required additional disclosures being included in our consolidated financial statements once adopted.

On July 30, 2025, the FASB issued ASU 2025-05, which amends ASC 326-20 to provide a practical expedient for all entities and an accounting policy election for non-public business entities in estimating expected credit losses on current accounts receivable and current contract assets arising from transactions accounted for under ASC 606. We are currently evaluating whether to adopt the practical expedient under ASU 2025-05. We expect that the effect, if there are any, on our allowance for credit losses will depend on the mix and aging of our current receivables and contract assets under ASC 606, the timing of collections after period end, and whether macroeconomic forecasts materially deviate from current conditions.

**NOTE 2 – BUSINESS OVERVIEW**

Doing business as "Franklin Access", we are a leading global provider of integrated wireless solutions utilizing the latest 5G (fifth generation) and 4G LTE (fourth generation long-term evolution) technologies including mobile hotspots, fixed wireless routers, and mobile device management (MDM) solutions. We are a leading enabler of the Digital Divide initiative, and our expertise extends to innovation in Internet of Things (IOT) and machine-to-machine (M2M) applications, driving forward seamless communication and connectivity for both individuals and enterprises.

We hold a 66.3% ownership in Franklin Technology Inc. ("FTI"), a research and development company based in Seoul, South Korea. FTI primarily provides design and development services for our wireless products. We hold a 60% ownership interest in Sigbeat Inc., based in San Diego, California ("Sigbeat"), which will engage in worldwide sales, marketing, customer support and operations for telecommunications modules. Our products are generally marketed and sold directly to wireless operators and indirectly through strategic partners and distributors. Our primary markets are in North America and Asia.

**NOTE 3 – BASIS OF PRESENTATION**

The accompanying unaudited consolidated financial statements of Franklin Wireless Corp. have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") for interim financial information and are presented in accordance with the requirements of Form 10-Q. In the opinion of management, the financial statements included herein contain all adjustments, including normal recurring adjustments, considered necessary to present fairly the financial position, the results of operations and comprehensive income (loss) and cash flows of the Company for the periods presented. These financial statements and notes hereto should be read in conjunction with the financial statements and notes thereto for the fiscal year ended June 30, 2025 included in our Form 10-K filed on September 29, 2025. The operating results or cash flows for the interim periods presented herein are not necessarily indicative of the results to be expected for any other interim period or the full year.

**NOTE 4 – DEFINITE LIVED INTANGIBLE ASSETS, NET**

The definite lived intangible assets consisted of the following as of September 30, 2025:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Definite lived intangible assets:** | **Expected Life** | **Average**<br> **Remaining**<br> **life** | **Gross**<br> **Intangible**<br> **Assets** | **Less Accumulated**<br> **Amortization** | **Net Intangible**<br> **Assets** |
| Technology in progress | Not Applicable |  | $63303 | $– | $63303 |
| Software | 5 years | 0.7 years | 440963 | 356219 | 84744 |
| Patents | 10 years | 5.8 years | 83485 | 33067 | 50418 |
| Certifications & licenses | 3 years | 1.4 years | 3603379 | 2936196 | 667183 |
| **Total as of September 30, 2025** |  |  | $**4191130** | $**3325482** | $**865648** |

---

The definite lived intangible assets consisted of the following as of June 30, 2025:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Definite lived intangible assets:** | **Expected Life** | **Average**<br> **Remaining**<br> **life** | **Gross**<br> **Intangible**<br> **Assets** | **Less Accumulated**<br> **Amortization** | **Net Intangible**<br> **Assets** |
| Technology in progress | Not Applicable |  | $452676 | $– | $452676 |
| Software | 5 years | 0.9 years | 448922 | 355600 | 93322 |
| Patents | 10 years | 6.0 years | 79519 | 31679 | 47840 |
| Certifications & licenses | 3 years | 1.3 years | 3166828 | 2746554 | 420274 |
| **Total as of June 30, 2025** |  |  | $**4147945** | $**3133833** | $**1014112** |

---

Amortization expense recognized for the three months ended September 30, 2025 and 2024 was $198,296 and $253,995, respectively.

The amortization expenses of the definite lived intangible assets for the future are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **FY2026** | **FY2027** | **FY2028** | **FY2029** | **FY2010** | **Thereafter** |
| **Total** | $362067 | $225305 | $183559 | $30303 | $1111 | $– |

---

**NOTE 5 – ACCRUED LIABILITIES**

Accrued liabilities consist of the following as of:

---

| | | |
|:---|:---|:---|
|  | **September 30, 2025** | **June 30, 2025** |
| Accrued payroll deductions owed to government entities | $50182 | $50988 |
| Accrued bonuses to an officer – related party (1) | 2750000 | 2625000 |
| Accrued salaries |  | 132377 |
| Accrued vacation | 187452 | 174108 |
| Accrued expenses for service providers | 8000 | 69318 |
| Accrued marketing development funds (2) | 797215 | 673205 |
| Other accrued liabilities | 72048 | 72048 |
| **Total** | $**3864897** | $**3797044** |

---

&nbsp;&nbsp;&nbsp;&nbsp;(1) The balance of Accrued Bonus to an officer consists of two components: the Quarterly Bonus and the Joint
Venture Incentive. As of September 30, 2025, no cash payment has been made by the Company for either accrued amount.

On November 10, 2022, the Company and OC Kim, its President, entered into an amendment of the employment agreement dated September 7, 2021. The amendment provides for the payment of an incentive to Mr. Kim, of $125,000 for each calendar quarter during the remaining four-year term of the employment agreement, for an aggregate total of $2 million, with the first such bonus accrued on December 31, 2022. Incentive bonuses of $125,000 have been accrued for three months ended September 30, 2025, resulting in accrued bonus balances of $1,500,000 and $1,375,000 as of September 30, 2025, and June 30, 2025, respectively.

On September 23, 2024, the Board acknowledged that Mr. Kim had earned an incentive bonus of $1,250,000 for negotiating and securing a joint venture agreement which resulted in the organization of Sigbeat. The Company and Mr. Kim entered into a Forbearance Agreement, dated September 23, 2024, under which Mr. Kim agreed to defer the bonus, in exchange for the Company's agreement to allow Mr. Kim to defer payment of the $1,000,000 settlement amount owed by Mr. Kim to the Company under a Settlement Agreement, dated June 12, 2024. On January 16, 2025, there was a completed contribution for Common Stock of Sigbeat, and the Company accrued the deferred incentive bonus of $1,250,000 to Mr. Kim.

&nbsp;&nbsp;&nbsp;&nbsp;(2) During the three months ended September 30, 2025, the Company accrued $124,010 in marketing development
funds payable to a customer to support the customer's marketing and promotion programs for the Company's products, resulting
in a total accrued marketing development fund balance of $797,215 as of September 30, 2025.

**NOTE 6 – COMMITMENTS AND CONTINGENCIES**

**Leases**

We adopted ASC 842 new lease accounting on July 1, 2019. We have operating leases for both the Company and FTI, in accordance with ASC 842.

We determine whether an arrangement contains a lease at inception. A lease is a contract that provides the right to control an identified asset for a period of time in exchange for consideration. Operating leases are recorded in the balance sheet as right-of-use asset ("ROU asset") and operating lease obligation. ROU assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payment arising from the lease ROU assets and operating lease liabilities are recognized at the commencement date of the lease and measured based on the present value of lease payment over the lease term. The ROU asset also includes deferred rent liabilities. Our lease arrangements generally do not provide an implicit interest rate. As a result, in such situations, we use its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The Company includes lease extension or termination options in the measurement of its right-of-use ("ROU") assets and lease liabilities when it is reasonably certain that such options will be exercised. Lease expense for operating lease is recognized on a straight-line basis over the lease term. We are also electing not to apply the recognition requirements to short-term leases of twelve months or less and instead will recognize lease payments as expense on a straight-line basis over the lease term.

Effective January 1, 2024, we leased approximately 11,400 square feet of office space in San Diego, California. The lease has an initial term of 65 months, expiring on May 31, 2029. The monthly rent for the first year was $27,789, subject to a fixed three percent annual increase every first of January, and the lease includes one month of rent abatement each year. In addition to the base monthly rent, the lease also requires payment for certain common area costs. We maintain appropriate insurance coverage and believe the facility is suitable and adequate for our present needs. Rent expense for this office space totaled $85,295 and $83,367 for the three months ended September 30, 2025, and 2024, respectively.

Our Korea-based subsidiary, FTI, leases approximately 10,000 square feet of office space, at a monthly rent of approximately $6,600, and additional office space consisting of approximately 2,682 square feet at a monthly rent of approximately $2,200, both located in Seoul, South Korea. These leases expired on August 31, 2024, and were extended for an additional 24 months to August 31, 2026. In addition to monthly rent, the leases provide for periodic cost of living increases in the base rent and payment for certain common area costs. These facilities are covered by an appropriate level of insurance, and we believe them to be suitable for our use and adequate for our present needs. Rent expense related to these leases was approximately $26,765 and $27,346 for the three months ended September 30, 2025, and 2024.

We leased one corporate vehicle on December 1, 2024, in San Diego, California, for our employees, under a non-cancelable lease that expires on November 30, 2027. Rent expense related to this lease were $1,487 and $0 for the three months ended September 30, 2025 and 2024, respectively.

We used discount rates of 7.0% and 6.0% in determining our operating lease liabilities for the office spaces in San Diego, California, and South Korea, respectively, and used a discount rate of 7.0% in determining our lease liabilities for the vehicle. These rates represented our incremental borrowing rates at that time. Short-term leases with initial terms of twelve months or less are not capitalized. The office leases of our Korea-based subsidiary were extensions of previous leases and do not contain any further extension provisions.

Total rent expenses for the three months ended September 30, 2025, and 2024 were $119,339 and $112,757, respectively. In accordance with ASC 842, the components of the lease expense and supplemental cash flow information related to leases for the three months ended September 30, 2025, and 2024 are as follows:

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| | | |
|:---|:---|:---|
|  | **Three Months Ended September 30,** | **Three Months Ended September 30,** |
|  | **2025** | **2024** |
| Operating lease expense | $112060 | $110713 |
| Vehicle lease expense | 1487 |  |
| Other short term lease costs | 5792 | 2044 |
| Total lease expense | $**119339** | $**112757** |

---

In accordance with ASC 842, future minimum payments under operating leases are as follows:

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| | |
|:---|:---|
|  | **Operating Lease** |
| Fiscal 2026 | $337421 |
| Fiscal 2027 | 376450 |
| Fiscal 2028 | 389915 |
| Fiscal 2029 | 363310 |
| Total lease payments | 1467096 |
| Less imputed interest | (172588) |
| **Total** | $**1294508** |
| Remaining lease term-operating lease in San Diego, California | 3.7 years |
| Discount rate-operating lease in San Diego, California | 7% |
| Remaining lease term-operating lease in South Korea | 0.9 years |
| Discount rate-operating lease in South Korea | 6% |
| Remaining lease term-vehicle lease in San Diego, California | 2.2 years |
| Discount rate-vehicle lease in San Diego, California | 7% |

---

**WARRANTY REPAIRS** 

The following table sets forth the accumulated percentages of return rates and warranty repairs for all products currently marketed, in the aggregate, from the date each product was introduced through September 30, 2025.

---

| | | |
|:---|:---|:---|
| **Current Devices** | **Current Devices** | **Current Devices** |
| **Device Type** | **Return Rate** | **Warranty Repairs** |
| 4G Wireless Devices | 0.11% | 0.01% |
| 5G Wireless Devices | 0.55% | 0.14% |

---

**Litigation**

We are from time to time involved in certain legal proceedings and claims arising in the ordinary course of business.

*Verizon Jetpack Recall*

On April 8, 2021, Verizon issued a press release announcing that it was working with the U.S. Consumer Product Safety Commission (CPSC) to conduct a voluntary recall of certain Verizon Ellipsis Jetpack mobile hotspot devices, indicating that the lithium-ion battery in the devices can overheat, posing a fire and burn hazard. According to the CPSC release, the recall affects approximately 2.5 million devices. We imported the devices and supplied them to Verizon.

Verizon first advised us of one alleged Jetpack device failure at the end of February 2021. We immediately began meeting with Verizon and requested access to the device. We also began internal testing to evaluate device performance. We did not receive any further incident information until the last week of March 2021. On April 1, 2021 we issued a press release announcing that we had received reports from Verizon about potential issues with the batteries in the devices. On April 9, 2021 we issued a press release announcing the voluntary recall by Verizon.

We are not currently aware of any aspect of the Jetpack design that could cause the devices to fail in the way described in Verizon's recall notice.

*Future Impact on Financial Performance Arising from Verizon Jetpack Recall*

At this time, we do not have information that identifies the cause of the alleged incidents. We also do not have any specific legal claims or theories of causation for device failure incidents that would help us estimate the cost of potential future litigation. No liability has been recorded for this litigation because the Company believes that any such liability is not probable and reasonably estimable at this time.

*FTI Litigation in Korea*

In January of 2025 our South Korea-based subsidiary, FTI was sued by Partron Co., Ltd., a South Korean manufacturer of electronic parts for mobile and telecommunication devices ("Partron"). The complaint, filed in Seoul Central District Court, alleges that FTI requested Partron to prepare semiconductor components to be included in FTI's products for resale to third parties. The complaint also alleges that FTI and Partron had entered into a Confidentiality Agreement under which Partron shared the login credentials for its Qualcomm account and that FTI used such access for the design of the products but contracted with another vendor to produce the components. It further alleges that Partron ordered a large quantity of semiconductor components from its business partners, such as Qualcomm and Dasaron Corporation, in reliance on such requests from FTI, but FTI failed to complete the purchase of such components from Partron. Parton alleges that it paid its suppliers for such components, but that FTI failed to purchase the components from Partron, resulting in damages, including interest, of $8,126,786, under the South Korean Unfair Competition Prevention Act and other legal theories.

The Company owns approximately 66.34% of the outstanding equity securities of FTI. The action does not name the Company as a defendant. FTI has advised the Company that it does not believe the allegations are supported by the facts and it intends to vigorously oppose the action.

**Shareholder Litigation**

*Harwood / Martin*

A legal action was filed in the U.S. District Court, Southern District of California (San Diego) against Franklin, as a nominal defendant, by Stephen Harwood, derivatively on behalf of nominal defendant Franklin Wireless Corp. v. O.C. Kim, et al., Case #21cv01837-AJB-MSB, on or about October 29, 2021, claiming among other things, that we had prior knowledge that the recall was likely and that we did not disclose that information to investors in a timely manner. We believe these allegations are not supported by the facts and we will vigorously defend against such claims.

A legal action was filed in the U.S. District Court, Southern District of California (San Diego) against Franklin, as a nominal defendant, by Debra Martin, derivatively on behalf of nominal defendant Franklin Wireless Corp. v. O.C. Kim, et al., Case #21cv2091-AJB-MSB, on or about December 15, 2021, claiming among other things, that we had prior knowledge that the recall was likely and that we did not disclose that information to investors in a timely manner. We believe these allegations are not supported by the facts and we will vigorously defend against such claims.

The Harwood and Martin actions have been consolidated into a single action in the U.S. District Court, Southern District of California (San Diego) titled "In re Franklin Wireless Corp. Derivative Litigation," Case No.: 21cv1837-AJB (MSB). A jury trial was held in December 2024.

On December 19<sup>th</sup>, 2024, after an 8-day trial, the jury returned a verdict finding only nominal damages of $0.99 against a single director and no damages against all other defendants.

*Pape*

A legal action was filed in the Second Judicial District Court of Nevada in the County of Washoe against Franklin, as a nominal defendant, Barbara Pape, derivatively on behalf of nominal defendant Franklin Wireless Corp. v. O.C. Kim, et al., Case # CV22-00471, on or about March 21, 2022, claiming among other things, that we had prior knowledge that the recall was likely and that we did not disclose that information to investors in a timely manner. Following the jury verdict in the consolidated Harwood and Martin action finding only nominal damages, the parties agreed to dismiss this action. On August 12, 2025, the court formally dismissed the case.

*"Short-Swing" Profits Litigation*

A legal action was filed in the U.S. District Court, Southern District of California (San Diego) against Franklin, as a nominal defendant, Nosirrah Management LLC v. Franklin Wireless et al., Case # 3:21-cv-01316-RSH-JLB, on or about July 22, 2021, claiming that our Chief Executive Officer, O.C. Kim, violated Section 16(b) of the Securities Exchange Act of 1934 for receiving "short-swing" profits from a sale and purchase of Franklin shares, in violation of that Act. On October 19, 2023, the jury returned a verdict of $2,000,000 in favor of the Company against the Company's Chief Executive Officer, O.C. Kim. Mr. Kim. Subsequently, the parties entered into a settlement agreement on June 12, 2024, for Mr. Kim to pay $1,000,000, and the appeal by OC Kim was dismissed. On September 23, 2024 the Company and Mr. Kim entered into a Forbearance Agreement to defer payment of the settlement in exchange for deferment of a $1,250,000 bonus for securing a joint venture agreement to allow Mr. Kim time to pursue remedies with the State of Nevada.

On January 16, 2025, the Company accrued the deferred incentive bonus of $1,250,000 to OC Kim, its President, and recognized a receivable for the deferred $1,000,000 settlement amount owed by Mr. Kim to the Company. As of June 30, 2025, no payment for the accrued bonus has been made to Mr. Kim by the Company, and the receivable of $1,000,000 from Mr. Kim was partially settled through the May 8, 2025 option repurchase transaction, in which the $337,404 net proceeds otherwise payable to Mr. Kim were applied against the receivable. This leaves a remaining settlement balance of $662,596 owed by Mr. Kim as of September 30, 2025.

**Loan Agreement with Subsidiary, FTI**

On March 21, 2022, Franklin Wireless Corp. (the "Company") entered into a Loan Agreement with its South Korean subsidiary, FTI, under which the Company agreed to loan US$10,000,000 to FTI. The Company owns a majority of the outstanding equity of FTI. FTI's primary business is providing design and development services to the Company for our wireless products. As part of the loan transaction, FTI delivered a $10 million Promissory Note to the Company (the "Note"). In the preparation of consolidated financial statements of the Company, the transactions and balances related to the loan of $10 million, including the accrued interest for the year ended June 30, 2025, were eliminated as intercompany transactions.

The purpose of the loan is to allow FTI to purchase a facility in South Korea to house its operations, and to provide it with additional working capital. The purchase of such a facility with the loan proceeds is subject to the Company's reasonable approval. Upon acquisition of the facility, FTI is required to grant the Company a mortgage on it to secure payment of the Note. The Note is for a term of five years, provides for annual payments of interest at 2% per annum, and is due and payable upon maturity. The Note and Loan Agreement includes customary provisions for default and acceleration upon default, and a default interest rate of 7% per annum. FTI has not yet acquired a facility for its operations.

The loan proceeds are subject to foreign exchange fluctuations as the funds are being held in Korea at a Korean bank. Should the exchange rate rise or fall during the term of the agreement the return value in the United States Dollar ("USD") could decrease resulting in a potential loss of value.

**Employment Contracts**

On October 1, 2020, we entered into Change of Control Agreements with OC Kim, our President, and Yun J. (David) Lee, our Senior Vice President of Sales who previously served as Chief Operating Officer. Each Change of Control Agreement provides for a lump sum payment to the officer in case of a change of control of the Company. The term includes the acquisition of Common Stock of the Company resulting in one person or company owning more than 50% of the outstanding shares, a significant change in the composition of the Board of Directors of the Company during any 12-month period, a reorganization, merger, consolidation or similar transaction resulting in the transfer of ownership of more than fifty percent (50%) of the Company's outstanding Common Stock, or a liquidation or dissolution of the Company or sale of substantially all of the Company's assets.

The Change of Control Agreement with Mr. Kim calls for a payment of $5 million upon a change of control, and the agreement with Mr. Lee calls for a payment of $2 million upon a change of control. These agreements were for an initial term of three years but have now been extended through October 2027.

On November 10, 2022, the Company and OC Kim, its President, entered into an amendment of the employment agreement dated September 7, 2021. The amendment provides for a severance payment of $3 million if Mr. Kim voluntarily terminates his employment with the Company or if he voluntarily terminates his employment due to a "change in circumstances," generally defined as a material breach by the Company of its salary and benefit obligations or a significant reduction in Mr. Kim's title or responsibilities. In the case of a termination of employment by the Company for cause (generally defined as conviction of a felony, or a misdemeanor where imprisonment is imposed, commission of any act of theft, fraud, dishonesty, or material falsification of any employment or Company records, or improper disclosure of the Company's confidential or proprietary information), the Company is to make a severance payment of $1,500,000. In either case, any unvested options become immediately vested.

In the amendment, Mr. Kim also agrees that, for a period of two years after termination, he will not disparage the Company or its officers, solicit any of its employees to terminate their employment, or disclose any of the Company's proprietary information. In addition, the amendment provides for the payment of an incentive bonus to Mr. Kim of $125,000 for each calendar quarter during the remaining four-year term of the employment agreement, with the first such bonus due on December 31, 2022. Incentive bonuses of $125,000 have been accrued for each of three months ended September 30, 2025 and 2024, resulting in accrued bonus balances of $1,500,000 and $1,375,000 as of September 30, 2025, and June 30, 2025, respectively. As of September 30, 2025, no payment for the accrued bonuses has been made by the Company.

The employment agreement with OC Kim was renewed and extended by the Board in September 2024 and will continue through October 2027.

**Joint Venture Agreement**

On May 14, 2024, the Company entered into an Agreement for Formation of a Joint Venture Corporation (the "Agreement"). Under the terms of the Agreement, the parties formed a Nevada corporation, Sigbeat, to be owned 60% by Franklin and 40% by its EMS partner, Forge. The parties contributed a total of $5,000,000 in capital, in accordance with their respective ownership interest percentages. Under the terms of the Agreement, Sigbeat has a Board of Directors consisting of three members, of whom two are to be appointed by the Company and one appointed by Forge. Sigbeat will engage in worldwide sales, marketing, customer support and operations for telecommunications modules under such brands or designations as the Board of Directors of Sigbeat determine.

Pursuant to the Agreement, in July 2024, Sigbeat entered into a stock subscription agreement with Forge to purchase 400,000 shares of Common Stock, representing 40% of the total outstanding Common Stock of Sigbeat. On December 23, 2024, and January 9, 2025, the Company contributed $600,000 and $2,400,000 for Common Stock, respectively, and, on January 16, 2025, Forge contributed $2,000,000 for Common Stock.

**Forbearance Agreement**

On September 23, 2024, the Board acknowledged that Mr. Kim had earned an incentive bonus of $1,250,000 for negotiating and securing a joint venture agreement with its EMS partner. The Company and Mr. Kim also entered into a Forbearance Agreement on September 23, 2024, under which Mr. Kim agreed to defer the bonus, in exchange for the Company's agreement to allow Mr. Kim to defer payment of the $1,000,000 settlement amount owed by Mr. Kim to the Company under a Settlement Agreement, dated June 12, 2024.

On January 16, 2025, the Company accrued the deferred incentive bonus of $1,250,000 to OC Kim, its President, and recognized a receivable for the deferred $1,000,000 settlement amount owed by Mr. Kim to the Company. As of June 30, 2025, no payment for the accrued bonus has been made to Mr. Kim by the Company, and the receivable of $1,000,000 from Mr. Kim was partially settled through the May 8, 2025 option repurchase transaction, in which the $337,404 net proceeds otherwise payable to Mr. Kim were applied against the receivable. This leaves a remaining settlement balance of $662,596 owed by Mr. Kim as of September 30, 2025.

**International Tariffs**

Our products are currently manufactured in Vietnam. We believe that our products are currently exempt from international tariffs upon import from our manufacturers to the United States.

If tariffs are imposed on our products either based on type of product or the country of manufacture, they could significantly increase our costs to import devices and potentially reduce or even eliminate our ability to earn profits from the sale of our devices. Should we be required to use device manufacturing companies located outside of tariffed countries we will incur significant delays in production and possibly lose sales as a result of those changes and delays.

Given the unpredictable timing of tariff implementation, it is possible that sales could be in process and become subject to a tariff that would result in losses on those transactions. Any such reduction in profit margins, lost sales and or increased costs would likely have a negative impact on the price of our shares in the market.

**Customer Indemnification**

Under purchase orders and contracts for the sale of our products we may provide indemnification to our customers for potential intellectual property infringement claims for which we may have no corresponding recourse against our third-party licensors. This potential liability, if realized, could materially adversely affect our business, operating results and financial condition.

**NOTE 7 – CYBERSECURITY.**

Cybersecurity risk management is an integral part of our overall enterprise risk management program. The Company manages cybersecurity and data protection through a continuously evolving program. Our cybersecurity risk management program is designed to provide a framework for assessing, identifying and managing cybersecurity threats and incidents, including threats and incidents associated with the use of services provided by third-party service providers, and to facilitate coordination across different departments of our Company. Our processes include steps for assessing the severity of a cybersecurity threat, identifying the source of a cybersecurity threat, including whether the cybersecurity threat is associated with a third-party service provider, and implementing cybersecurity countermeasures and mitigation strategies and informing management and the board of directors of material cybersecurity threats and incidents.

The Board of Directors has oversight for the most significant risks facing us and for our processes to identify, prioritize, assess, manage and mitigate those risks. The Audit Committee of the Board of Directors (the "Audit Committee") has been designated to oversee cybersecurity risks. The Audit Committee receives regular updates on cybersecurity and information technology matters and related risk exposures from our management. The Board of Directors also receives periodic updates from management and the Audit Committee on cybersecurity risks. Management is responsible for identifying, considering and assessing material cybersecurity risks on an ongoing basis, establishing processes designed to ensure that such potential cybersecurity risk exposures are monitored, putting in place mitigation measures and maintaining cybersecurity programs. Our cybersecurity programs are under the direction of our Chief Executive Officer. Management regularly updates the Audit Committee on our cybersecurity programs, which includes cybersecurity risks and mitigation strategies, vulnerability management, and on-going cybersecurity projects.

As of September 30, 2025, we did not identify any cybersecurity incidents that materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition. However, despite our efforts, we cannot eliminate all risks from cybersecurity threats or provide assurances that we have not experienced an undetected cybersecurity incident. It is possible that we may not implement appropriate controls if we do not detect a particular risk. In addition, security controls, no matter how well designed or implemented, may only mitigate and not fully eliminate the risks. Even when a risk is detected, disruptive events may not always be immediately and thoroughly interpreted and acted upon.

**NOTE 8 – LONG-TERM INCENTIVE PLAN AWARDS**

We apply the provisions of ASC 718, "Compensation - Stock Compensation," to all of our stock-based compensation awards and use the Black-Scholes option pricing model to value stock options. The fair value of each share option award on the date of grant was estimated using the Black-Scholes method based on the following weighted average assumptions: The risk-free interest rate is based on the U.S. treasury yield curve in effect at the time of grant for periods corresponding with the expected term of options award; the expected term represents the period of time that options granted are expected to be outstanding, taking into account the vesting provisions and historical exercise patterns of participants; the expected volatility is based upon historical volatility; and the dividend yield is based upon the company's dividend rate at the time fair value is measured and future expectations. Under this application, we record compensation expense for all awards granted.

In July of 2020, the Board of Directors adopted the 2020 Franklin Wireless Corp. Stock Option Plan (the "2020 Plan"), which covers 1,000,000 shares of Common Stock. The 2020 Plan provides for the grant of incentive stock options, non-qualified stock options and restricted stock to our employees, directors, and independent contractors. These options will have such vesting or other provisions as may be established by the Board of Directors or Plan Administrator at the time of each grant.

The estimated forfeiture rate considers historical turnover rates stratified into employee pools in comparison with an overall employee turnover rate, as well as expectations about the future. We periodically revise the estimated forfeiture rate in subsequent periods if actual forfeitures differ from those estimates. There were $0 and $87,384 compensation expenses recorded under this method for the three months ended September 30, 2025 and 2024, respectively.

A summary of the status of our stock options is presented below as of September 30, 2025:

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| | | | | |
|:---|:---|:---|:---|:---|
| <br>**Options** |<br><br><br>**Shares** |<br>**Weighted-**<br>**Average**<br>**Exercise**<br>**Price** | **Weighted-**<br>**Average**<br>**Remaining**<br>**Contractual**<br>**Life**<br>**(In Years)** |<br><br>**Aggregate**<br>**Intrinsic**<br>**Value** |
| Outstanding as of June 30, 2025 | 392001 | $4.64 | 0.58 | $117600 |
| Granted |  |  |  |  |
| Exercised |  |  |  |  |
| Cancelled |  |  |  |  |
| Forfeited or expired (1) | (245001) | 5.40 |  |  |
| Outstanding as of September 30, 2025 | 147000 | $3.38 | 1.24 | $144060 |
| Exercisable as of September 30, 2025 | 147000 | $3.38 | 1.24 | $144060 |

---

&nbsp;&nbsp;&nbsp;&nbsp;(1) A total of 245,001 shares of fully vested stock options, which had been previously granted through its
2020 employee stock option plan, lapsed and expired in July 2025.

The aggregate intrinsic value in the preceding table represents the total pretax intrinsic value, based upon the Company's closing stock price of $4.36 as of September 30, 2025, which would have been received by the option holders had all option holders exercised their options as of that date. The weighted-average grant-date fair value of stock options outstanding as of September 30, 2025, in the amount of 147,000 shares was $2.83 per share. As of September 30, 2025, there was no unrecognized compensation cost related to non-vested stock options granted.

A summary of the status of our stock options is presented below as of September 30, 2024:

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| | | | | |
|:---|:---|:---|:---|:---|
| <br>**Options** |<br><br><br>**Shares** |<br>**Weighted-**<br>**Average**<br>**Exercise**<br>**Price** | **Weighted-**<br>**Average**<br>**Remaining**<br>**Contractual**<br>**Life**<br>**(In Years)** |<br><br>**Aggregate**<br>**Intrinsic**<br>**Value** |
| Outstanding as of June 30, 2024 | 627001 | $4.24 | 2.88 | $130200 |
| Granted |  |  |  |  |
| Exercised |  |  |  |  |
| Cancelled |  |  |  |  |
| Forfeited or expired | (7000) | 3.96 |  |  |
| Outstanding as of September 30, 2024 | 620001 | $4.22 | 1.63 | $434400 |
| Exercisable as of September 30, 2024 | 590605 | $4.26 | 1.60 | $399125 |

---

The aggregate intrinsic value in the preceding table represents the total pretax intrinsic value, based upon the Company's closing stock price of $4.58 as of September 30, 2024, which would have been received by the option holders had all option holders exercised their options as of that date. The weighted-average grant-date fair value of stock options outstanding as of September 30, 2024, in the amount of 620,001 shares was $3.33 per share. As of September 30, 2024, there was unrecognized compensation cost of $83,199 related to non-vested stock options granted.

**NOTE 9 – STOCKHOLDERS' EQUITY**

**Common Stock**

We have been authorized to issue 50,000,000 shares of common stock, $0.001 par value. Each share of issued and outstanding common stock shall entitle the holder thereof to fully participate in all shareholder meetings, to cast one vote on each matter with respect to which shareholders have the right to vote, and to share ratably in all dividends and other distributions declared and paid with respect to common stock, as well as in the net assets of the corporation upon liquidation or dissolution.

For the three months ended September 30, 2025, no shares of common stock were issued, and there were 11,784,280 shares issued and outstanding as of September 30, 2025, and June 30, 2025.

**Preferred Stock**

We have been authorized to issue 10,000,000 shares of preferred stock. $0.01 par value, but no preferred stock is issued and outstanding as of September 30, 2025, and June 30, 2025.

**Treasury Stock**

We had 2,549,208 shares of treasury stock, valued at $3,554,893 (based on the costs that we agreed to repurchase) as of September 30, 2025, and June 30, 2025.

**NOTE 10 – RELATED PARTY TRANSACTIONS**

We entered into a Forbearance Agreement with Mr. Kim on September 23, 2024, under which Mr. Kim agreed to defer a $1,250,000 bonus previously earned by him in exchange for the Company's agreement to allow Mr. Kim to defer payment of the $1,000,000 settlement amount owed by Mr. Kim to the Company under a Settlement Agreement, dated June 12, 2024. On January 16, 2025, we accrued the deferred incentive bonus of $1,250,000 to OC Kim, our President, and recognized a receivable for the deferred $1,000,000 settlement amount owed by Mr. Kim to the Company. As of September 30, 2025, no payment for the accrued bonus has been made to Mr. Kim by the Company, and the receivable of $1,000,000 from Mr. Kim was partially settled through the May 8, 2025 option repurchase transaction, in which the $337,404 net proceeds otherwise payable to Mr. Kim were applied against the receivable. This leaves a remaining settlement balance of $662,596 owed by Mr. Kim as of September 30, 2025.

On May 14, 2024, we entered into an Agreement for Formation of a Joint Venture Corporation (the "Agreement"). Under the terms of the Agreement, the parties formed a Nevada corporation, Sigbeat, to be owned 60% by Franklin and 40% by its EMS partner, Forge. The parties contributed a total of $5,000,000 in capital, in accordance with their respective ownership interest percentages. Under the terms of the Agreement, Sigbeat has a Board of Directors consisting of three members, of whom two are to be appointed by the Company and one appointed by Forge. Sigbeat will engage in worldwide sales, marketing, customer support and operations for telecommunications modules under such brands or designations as the Board of Directors of Sigbeat determines. Pursuant to the Agreement, in July 2024, Sigbeat entered into a stock subscription agreement with Forge, for the purchase of 400,000 shares of Common Stock, representing 40% of the total outstanding Common Stock of Sigbeat. On December 23, 2024, and January 9, 2025, we contributed $600,000 and $2,400,000 for Common Stock, respectively, and, on January 16, 2025, Forge contributed $2,000,000 for Common Stock. On June 20, 2024, we entered into a Purchase and Supply Agreement with Forge. This Agreement outlines the terms under which we purchase certain products from Forge for resale to our customers.

For the three months ended September 30, 2025 and 2024, we purchased wireless data products from Forge in the amount of approximately $7.6 million and $1.6 million, respectively, and had related accounts payable of approximately $7.8 million and $1.8 million as of September 30, 2025 and 2024, respectively. Additionally, as of September 30, 2025 and September 30, 2024, we had accounts receivable from Forge, related to various minor transactions within FTI, totaling approximately $23,000 and $42,000, respectively.

Excluding what was previously described, there have not been any transactions entered into or have been a participant in which a related person had or will have a direct or indirect material interest.

**NOTE 11 – SUBSEQUENT EVENTS**

The FASB issued ASC 855, "Subsequent Events." ASC 855 establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. We have evaluated all events or transactions that occurred after September 30, 2025, up through the date the financial statements were available to be issued.

On November 4, 2025, the Board of Directors declared a cash dividend of $0.04 per share of the Company's common stock. The dividend is payable on December 2, 2025 to stockholders of record as of November 14, 2025.

Other than the matter described above, we did not have any material recognizable subsequent events that require disclosure in the financial statements as of November 14, 2025.

**ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our financial statements and related notes included elsewhere in this report. This report contains certain forward-looking statements relating to future events or our future financial performance. These statements are subject to risks and uncertainties which could cause actual results to differ materially from those discussed in this report. You are cautioned not to place undue reliance on this information, which speaks only as of the date of this report. We are not obligated to publicly update this information, whether as a result of new information, future events or otherwise, except to the extent we are required to do so in connection with our obligation to file reports with the SEC. For a discussion of the important risks to our business and future operating performance, see the discussion under the caption "Item 1A. Risk Factors" and under the caption "Factors That May Influence Future Results of Operations" in the Company's Form 10-K for the year ended June 30, 2025, filed on September 29, 2025. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this report might not occur.

**BUSINESS OVERVIEW**

Doing business as "Franklin Access", we are a leading global provider of integrated wireless solutions utilizing the latest 5G (fifth generation) and 4G LTE (fourth generation long-term evolution) technologies including mobile hotspots, fixed wireless routers, and mobile device management (MDM) solutions. We are a leading enabler of the Digital Divide initiative, and our expertise extends to innovation in Internet of Things (IOT) and machine-to-machine (M2M) applications, driving forward seamless communication and connectivity for both individuals and enterprises.

We hold a 66.3% ownership in Franklin Technology Inc. ("FTI"), a research and development company based in Seoul, South Korea. FTI primarily provides design and development services for our wireless products. We hold a 60% ownership interest in Sigbeat Inc., based in San Diego, California ("Sigbeat"), which will engage in worldwide sales, marketing, customer support and operations for telecommunications modules. Our products are generally marketed and sold directly to wireless operators and indirectly through strategic partners and distributors. Our primary markets are in North America and Asia.

**FACTORS THAT MAY INFLUENCE FUTURE RESULTS OF OPERATIONS**

We believe that our revenue growth will be influenced largely by (1) the successful maintenance of our existing customers, (2) the rate of increase in demand for wireless data products, (3) customer acceptance of our new products, (4) new customer relationships and contracts, (5) our ability to meet customers' demands, (6) our ability to maintain good relationships with our manufacturing partners and suppliers, and (7) the defect rates experienced by end users of our hardware and software products.

We have entered into and expect to continue to enter into new customer relationships and contracts for the supply of our products, and this may require significant demands on our resources, resulting in increased operating, selling, and marketing expenses associated with such new customers.

We continuously evaluate the performance of our hardware and software products to discover defects that can adversely affect our revenue, income, and the price of our stock. If defects occur that customers believe are either severe in nature or excessively frequent in occurrence, customers could stop buying our products and services and the value of our stock may decrease.

We are also seeing that demand from end-users has been shifting in the post-pandemic economy as remote education and work from home trends are declining. Current demand for mobile device management (MDM) services has been declining. We are working to improve and further enhance our software service offerings to address this change in the market.

**CRITICAL ACCOUNTING POLICIES**

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which are prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). The preparation of these financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingencies at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting periods. Management evaluates these estimates and assumptions on an ongoing basis. Our estimates and assumptions have been prepared on the basis of the most current reasonably available information. The results of these estimates form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from these estimates under different assumptions and conditions.

We have several critical accounting policies, which were described in our Annual Report on Form 10-K for the year ended June 30, 2025, that are both important to the portrayal of our financial condition and results of operations and require management's most difficult, subjective, and complex judgments. Typically, the circumstances that make these judgments difficult, subjective, and complex have to do with making estimates about the effect of matters that are inherently uncertain. There were no material changes to our critical accounting policies for the three months ended September 30, 2025.

**RESULTS OF OPERATIONS**

The following table sets forth, for the three months ended September 30, 2025 and 2024, our statements of comprehensive income including data expressed as a percentage of sales:

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| | | |
|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** |
|  | **September 30,** | **September 30,** |
|  | **2025** | **2024** |
| Net sales | 100.0% | 100.0% |
| Cost of goods sold | (77.2)% | (84.5)% |
| Gross profit | 22.8% | 15.5% |
| Operating expenses | 18.2% | 18.3% |
| Income (loss) from operations | 4.6% | (2.8)% |
| Other income, net | 0.0% | 8.0% |
| Net income before income taxes | 4.6% | 5.2% |
| Income tax provisions | 0.3% | 0.3% |
| Net income | 4.3% | 4.9% |
| Less: noncontrolling interest in net (loss) income of subsidiary | (0.7)% | 1.0% |
| Net income attributable to Parent Company stockholders | 5.0% | 3.9% |

---

**THREE MONTHS ENDED SEPTEMBER 30, 2025 COMPARED TO THREE MONTHS ENDED SEPTEMBER 30, 2024**

**NET SALES** - Net sales decreased by $577,952, or 4.3%, to $12,744,960 for the three months ended September 30, 2025 from $13,322,912 for the corresponding period of 2024. For the three months ended September 30, 2025, net sales by geographic regions, consisting of North America and Asia, were $12,733,051 (99.9% of net sales) and $11,909 (0.1% of net sales), respectively. For the three months ended September 30, 2024, net sales by geographic regions, consisting of North America and Asia, were $13,322,448 (100.0% of net sales) and $464 (0.0% of net sales), respectively.

Net sales in North America decreased by $589,397, or 4.4%, to $12,733,051 for the three months ended September 30, 2025 from $13,322,448 for the corresponding period of 2024. The decrease in net sales in North America was primarily due to decreased demand from our major carrier customers, which typically varies from period to period. Net sales in Asia increased by $11,445, or 2,466.6%, to $11,909 for the three months ended September 30, 2025 from $464 for the corresponding period of 2024.

**GROSS PROFIT -** Gross profit increased by $838,268, or 40.5%, to $2,909,770 for the three months ended September 30, 2025 from $2,071,502 for the corresponding period of 2024. The gross profit in terms of net sales percentage was 22.8% for the three months ended September 30, 2025 compared to 15.5% for the corresponding period of 2024.

The increase in gross profit and in gross profit margin in terms of net sales was primarily driven by an increased proportion of high-margin sales and decreased production costs while overall sales decreased for the three months ended September 30, 2025 compared to the corresponding period of 2024.

**OPERATING EXPENSES** - Operating expenses decreased by $124,895, or 5.1%, to $2,319,390 for the three months ended September 30, 2025 from $2,444,285 for the corresponding period of 2024.

Selling, general, and administrative expenses decreased by $50,335, or 3.5%, to $1,369,638 for the three months ended September 30, 2025, from $1,419,973 for the corresponding period of 2024. The decrease in selling, general, and administrative expenses was primarily due to the reduction in legal expense and stock option expense of approximately $115,000 and $87,000, respectively, which was offset by increased delivery charges of approximately $110,000.

Research and development expense decreased by $74,560, or 7.3%, to $949,752 for the three months ended September 30, 2025, from $1,024,312 for the corresponding period of 2024. The decrease in research and development expense was primarily due to the reduction of approximately $73,000 in direct R&D costs (such as expenses for materials and third-party services), which typically fluctuate from period to period.

**TOTAL OTHER INCOME, NET** - Other income, net decreased by $1,066,515, or 99.7%, to $2,804 for the three months ended September 30, 2025 from $1,069,319 for the corresponding period of 2024. The decrease was primarily due to the unfavorable changes in foreign currency and the loss from the appreciation on the currency exchange rates in FTI of approximately $740,000 and the absence of a one-time gain of approximately $230,000 recognized in the prior-year period related to the write-off of a forgiven accrued commission to a customer.

**LIQUIDITY AND CAPITAL RESOURCES**

Our historical operating results, capital resources and financial position, in combination with current projections and estimates, were considered in management's plan and intentions to fund our operations over a reasonable period of time, which we define as the twelve-month period ending from the date of the filing of this Form 10-Q. For purposes of liquidity disclosures, we assess the likelihood that we have sufficient available working capital and other principal sources of liquidity to fund our operating activities and obligations as they become due.

Our principal source of liquidity as of September 30, 2025 consisted of cash and cash equivalents, as well as short-term investments, of $38,714,635. We believe we have sufficient available capital to cover our existing operations and obligations through at least one year from the date of the filing of this Form 10-Q. Our long-term future cash requirements will depend on numerous factors, including our revenue base, profit margins, product development activities, market acceptance of our products, future expansion plans and ability to control costs. If we are unable to achieve our current business plan or secure additional funding that may be required, we would need to curtail our operations or take other similar actions outside the ordinary course of business in order to continue to operate as a going concern.

**OPERATING ACTIVITIES** - Net cash used in operating activities for the three months ended September 30, 2025 was $1,488,908, and net cash provided by operating activities for the three months ended September 30, 2024 was $2,670,900.

The $1,488,908 in net cash used in operating activities for the three months ended September 30, 2025, was primarily due to the increase of accounts receivable of $5,487,322, which was partially offset by the increase in accounts payable of $1,521,184 and the decrease in inventories of $1,358,115 as well as our operating results (net income adjusted for depreciation, amortization, and other non-cash charges of $1,065,379).

The $2,670,900 in net cash provided by operating activities for the three months ended September 30, 2024 was primarily due to the increase in accounts payable of $3,550,907 as well as our operating results (net income adjusted for depreciation, amortization, and other non-cash charges), which was partially offset by the increase of inventories of $1,127,477.

**INVESTING ACTIVITIES** – Net cash provided by investing activities for the three months ended September 30, 2025 was $143,315, and net cash used in investing activities for the three months ended September 30, 2024 was $334,785.

The $143,315 in net cash provided by investing activities for the three months ended September 30, 2025 was primarily due to the sale of short-term investments of $197,386, which was partially offset by purchases related to capitalized product development costs and intangible assets of $53,167.

The $334,785 in net cash used in financial activities for the three months ended September 30, 2024 was primarily due to the purchase of short-term investments of $291,869, the purchase of property and equipment of $21,544, and the purchase of capitalized product development costs and intangible assets of $21,372, respectively.

**CONTRACTUAL OBLIGATIONS AND OTHER COMMITMENTS**

**Leases**

Refer to NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES in the Consolidated Financial Statements.

**Recently Issued Accounting Pronouncements**

Refer to NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES in the Consolidated Financial Statements.

**OFF-BALANCE SHEET ARRANGEMENTS** 

None.

**ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK**

As a "smaller reporting company," the Company is not required to respond to this item.

**ITEM 4. CONTROLS AND PROCEDURES**

**Evaluation of Disclosure Controls and Procedures**

Our management has evaluated, under the supervision and with the participation of OC Kim, our President, and Reid Granados, our Acting Chief Financial Officer, the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this report. Based upon that evaluation, our President and the Acting Chief Financial Officer have concluded that, as of September 30, 2025, our disclosure controls and procedures were effective in ensuring that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934 is (i) recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the SEC and (ii) accumulated and communicated to our management, including our principal executive and principal financial and accounting officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

**Changes in Internal Control Over Financial Reporting**

There have been no changes in our internal controls over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934 and as a result of adopting Topic 842) for the three months ended September 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

**PART II – OTHER INFORMATION**

**ITEM 1. LEGAL PROCEEDINGS**

We have provided information about legal proceedings in which we are involved in Note 6 of the notes to consolidated financial statements for the three months ended September 30, 2025, contained within this Quarterly Report on Form 10-Q.

**ITEM 1A. RISK FACTORS**

Our Annual Report on Form 10-K for the fiscal year ended June 30, 2025, filed with the SEC on September 29, 2025 (the "Annual Report"), includes a detailed discussion of our risk factors under the heading "PART I, ITEM 1A – RISK FACTORS." You should carefully consider the risk factors discussed in our Annual Report, as well as other information in this quarterly report. Any of these risks could cause our business, financial condition, results of operations and future growth prospects to suffer. We are not aware of any material changes from the risk factors previously disclosed.

**ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS**

None.

**ITEM 3. DEFAULTS UPON SENIOR SECURITIES**

None.

**ITEM 4. MINE SAFETY DISCLOSURES**

None.

**ITEM 5. OTHER INFORMATION**

During the quarter ended September 30, 2025, no director or officer of the Company adopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement," as each term is defined in Item 408(a) of Regulation S-K.

**ITEM 6. EXHIBITS**

---

| | |
|:---|:---|
| Exhibit<br> Number | Description |
| 31.1 | [Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](franklin_ex3101.htm). |
| 31.2 | [Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](franklin_ex3102.htm). |
| 32.1 | [Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](franklin_ex3201.htm). |
| 32.2 | [Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](franklin_ex3202.htm). |
| 101.INS | Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL 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 Label Linkbase Document |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
| 104 | Cover Page Interactive Data File (formatted in inline XBRL, and included in exhibit 101) |

---

**SIGNATURES**

In accordance with Section 13 of 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | |
|:---|:---|
| Franklin Wireless Corp. | Franklin Wireless Corp. |
| By: | /s/ OC Kim |
|  | OC Kim<br> President<br> (Principal Executive Officer) |
| By: | /s/ Reid Granados |
|  | Reid Granados |
|  | Acting Chief Financial Officer<br> (Principal Financial Officer) |

---

Dated: November 14, 2025

## Exhibit 31.1

**Exhibit 31.1**

**CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO**

**SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**

I, OC Kim, President of Franklin Wireless Corp., certify that:

1) I have reviewed this quarterly report on Form 10-Q of Franklin Wireless Corp.;

2) Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4) I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5) I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

<u>/s/ OC KIM</u> 

OC Kim

President

(Principal Executive Officer)

November 14, 2025

## Exhibit 31.2

**Exhibit 31.2**

**CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO**

**SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**

I, Reid Granados, Acting Chief Financial Officer of Franklin Wireless Corp., certify that:

1) I have reviewed this quarterly report on Form 10-Q of Franklin Wireless Corp.;

2) Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4) I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5) I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

<u>/s/ Reid Granados</u> 

Reid Granados

Acting Chief Financial Officer

(Principal Financial Officer)

November 14, 2025

## Exhibit 32.1

**Exhibit 32.1**

**CERTIFICATION PURSUANT TO**

**SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

In connection with the Quarterly Report of Franklin Wireless Corp. (the "Company") on Form 10-Q for the three months ended September 30, 2025 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, OC Kim, President of the Company, certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

<u>/s/ OC KIM</u> 

OC Kim

President

(Principal Executive Officer)

November 14, 2025

A signed copy of this written statement required by section 906 of the Sarbanes-Oxley Act of 2002 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

## Exhibit 32.2

**Exhibit 32.2**

**CERTIFICATION PURSUANT TO**

**SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

In connection with the Quarterly Report of Franklin Wireless Corp. (the "Company") on Form 10-Q for the three months ended September 30, 2025 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Reid Granados, Acting Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

<u>/s/ Reid Granados</u> 

Reid Granados

Acting Chief Financial Officer

(Principal Financial Officer)

November 14, 2025

A signed copy of this written statement required by section 906 of the Sarbanes-Oxley Act of 2002 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.