Balance Sheets

6 Months Ended

Jun. 30, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Balance Sheets

Note 3 – Balance Sheets

Accounts Receivable, Net

As of June 30, 2024 and December 31, 2023, accounts receivable, net consist of the following:

	June 30, 2024		December 31, 2023
Accounts receivable	$	1,538,941	$	2,216,235
Less: Allowance for credit losses*		—		(158,689	)
Accounts receivable, net	$	1,538,941	$	2,057,546

* Allowance for credit losses - Accounts receivable, net represent amounts billed and due from customers. Substantially all accounts receivable on June 30, 2024 are expected to be collected in 2024.

Inventories, Net

As of June 30, 2024 and December 31, 2023, inventories, net consist of the following:

	June 30, 2024			December 31, 2023
Raw materials	$	3,907,935		$	4,648,966
Work in process		1,116,384			903,217
Finished goods		1,732,647			1,806,239
Gross inventories		6,756,966			7,358,422
Less: Provision for obsolescence		(374,757	)		(421,442	)
Inventories, net	$	6,382,209		$	6,936,980

Prepaid and Other Current Assets

As of June 30, 2024 and December 31, 2023, prepaid and other current assets consist of the following:

	June 30, 2024		December 31, 2023
Prepaid inventories	$	108,925	$	12,738
Prepaid software licenses and annual fees		117,955		182,510
Prepaid rent		65,039		51,497
Prepaid insurance		55,827		166,210
Prepaid value-added tax charges		45,425		63,209
Prepaid other and other current assets		59,591		72,397
Prepaid and other current assets	$	452,762	$	548,561

AGEAGLE AERIAL SYSTEMS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED JUNE 30, 2024 AND 2023

(UNAUDITED)

Note 3 – Balance Sheets-Continued

Property and Equipment, Net

As of June 30, 2024 and December 31, 2023, property and equipment, net consist of the following:

	Estimated
Type	Useful Life (Years)		June 30, 2024			December 31, 2023
Leasehold improvements		3	$	89,272		$	136,382
Production tools and equipment		5		909,026			1,003,726
Computer and office equipment		3-5		357,891			407,747
Furniture		5		58,912			74,420
Drone equipment		3		130,163			170,109
Total Property and equipment				1,545,264			1,792,384
Less: Accumulated depreciation				(947,882	)		(992,492	)
Total: Property and equipment, net			$	597,382		$	799,892

During the three months ended June 30, 2024 and 2023, depreciation expense was $83,988 and $99,227 respectively, for the six months, depreciation expense was $186,063 and $199,924, respectively, which has been included in general and administrative expenses on the accompanying condensed consolidated statements of operations and comprehensive loss.

Intangible Assets, net

As of June 30, 2024 and December 31, 2023, intangible assets, net, other than goodwill, consist of following:

Name	Estimated Life (Years)		Balance as of December 31, 2023		Additions		Amortization			Balance as of June 30, 2024
Intellectual property/technology		5-7	$	606,354	$	—	$	(74,247	)	$	532,107
Customer base		3-10		999,774		—		(70,572	)		929,202
Trade names and trademarks		5-10		427,005		—		(30,141	)		396,864
Internal use software costs		3		582,148		58,303		(186,291	)		454,160
Total intangibles assets, net			$	2,615,281	$	58,303	$	(361,251	)	$	2,312,333

As of June 30, 2024, the weighted average remaining amortization period in years is 2.87 years. For the three and six months ended June 30, 2024 and 2023, amortization expense was $181,879 and $913,691, respectively and $361,251 and $1,814,332, respectively.

AGEAGLE AERIAL SYSTEMS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED JUNE 30, 2024 AND 2023

(UNAUDITED)

Note 3 – Balance Sheets-Continued

For the following years ending, the future amortization expense consists of the following:

	For the Years Ending December 31,
	(rest of year) 2024		2025		2026		2027		2028		Thereafter		Total
Intellectual property/technology	$	74,248	$	148,495	$	148,495	$	148,495	$	12,374	$	—	$	532,107
Customer base		70,573		141,145		141,145		141,145		141,145		294,049		929,202
Trade names and trademarks		30,145		60,283		60,283		60,283		60,283		125,587		396,864
Internal use software costs		194,181		214,172		41,623		4,184		—		—		454,160
Total intangible assets, net	$	369,147	$	564,095	$	391,546	$	354,107	$	213,802	$	419,636	$	2,312,333

Accrued Liabilities

As of June 30, 2024 and December 31, 2023, accrued liabilities consist of the following:

	June 30, 2024		December 31, 2023
Accrued purchases	$	—	$	290,126
Accrued compensation and related liabilities		446,145		278,794
Provision for warranty expense		290,218		303,217
Accrued dividends		623,210		512,227
Accrued professional fees		160,484		211,086
Accrued interest		126,184		326,945
Other		17,700		21,957
Total accrued liabilities	$	1,663,941	$	1,944,352