Form 8-K

8-K — Snail, Inc.

Accession: 0001493152-26-037121

Filed: 2026-08-11

Period: 2026-08-11

CIK: 0001886894

SIC: 7372 (SERVICES-PREPACKAGED SOFTWARE)

Item: Results of Operations and Financial Condition

Item: Financial Statements and Exhibits

Documents

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0001886894

2026-08-11

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UNITED

STATES

SECURITIES

AND EXCHANGE COMMISSION

Washington,

D.C. 20549

FORM

8-K

CURRENT

REPORT

Pursuant

to Section 13 or 15(d) of the

Securities

Exchange Act of 1934

Date

of Report (Date of earliest event reported): August 11, 2026

Snail,

Inc.

(Exact

name of registrant as specified in its charter)

Delaware

001-41556

88-4146991

(State

or other jurisdiction

incorporation)

(Commission

File

Number)

(IRS

Employer

Identification

Number)

12049

Jefferson Blvd

Culver

City, CA 90230

(Address

of principal executive offices) (Zip Code)

(310) 988-0643

(Registrant’s

telephone number, including area code)

Check

the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under

any of the following provisions:

☐

Written

communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐

Soliciting

material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐

Pre-commencement

communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐

Pre-commencement

communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities

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

Title

of each class

Trading

Symbol(s)

Name

of each exchange on which registered

Class

A Common Stock, $0.0001 par value per share

SNAL

The

Nasdaq Stock Market LLC

(The

Nasdaq Capital Market)

Indicate

by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405

of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging

growth company ☒

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. ☒

Item

2.02. Results of Operations and Financial Condition.

August 11, 2026, Snail, Inc., a Delaware corporation, (the “Company”) issued a press release that included financial information

for its quarter ended June 30, 2026. A copy of the press release is attached as Exhibit 99.1 to this Report on Form 8-K and is incorporated

herein by reference.

The

information in this Item 2.02 and in the press release attached as Exhibit 99.1 to this Current Report on Form 8-K shall not be deemed

to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the

liabilities of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended. The information contained in this

Item 2.02 and in the press release attached as Exhibit 99.1 to this Current Report on Form 8-K shall not be incorporated by reference

into any filing with the U.S. Securities and Exchange Commission made by the Company, whether made before or after the date hereof, regardless

of any general incorporation language in such filing.

Item

9.01. Financial Statements and Exhibits.

(d)

Exhibits.

Exhibit

No.

Description

99.1

Press Release, dated August 11, 2026, issued by Snail, Inc. regarding its financial results for its quarter ended June 30, 2026

104

Cover

Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant

to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its

behalf by the undersigned hereunto duly authorized.

SNAIL,

INC.

Date:

August 11, 2026

By:

/s/

Hai Shi

Name:

Hai

Shi

Title:

Founder,

Chief Executive Officer, Chief Strategy Officer and Chairman of the Board of Directors

EX-99.1

Filename: ex99-1.htm · Sequence: 2

Exhibit

99.1

Snail,

Inc. Reports Second Quarter 2026 Financial Results

CULVER

CITY, Calif., August 11, 2026 (GLOBE NEWSWIRE) – Snail, Inc. (Nasdaq: SNAL) (“Snail Games” or the “Company”),

a leading global independent developer and publisher of interactive digital entertainment, today announced financial results for the

second quarter ended June 30, 2026.

Second

Quarter 2026 and Recent Operational Highlights

ARK

Franchise Updates:

● ARK:

Survival Evolved (“ASE”):

○ Units

sold were approximately 574,000 for the second quarter of 2026

○ During

the second quarter of 2026, average daily active users (“DAU”) were 105,000 and

peak DAU was 131,000

● ARK:

Survival Ascended (“ASA”):

○ Units

sold were approximately 1.2 million for the second quarter of 2026

○ During

the second quarter of 2026, average DAU was 120,000 and peak DAU was over 155,000

○ Launched

the ARK: Fantastic Tames Season 1 Pack

○ Launched

ARK: Genesis Part 1 Ascended, ARK: Tides of Fortune, and shadow-dropped the ARK:

Dragontopia

○ Revealed

teaser for ARK Maker, a content creation tool designed to expand community-generated

content opportunities within the ASA ecosystem

● ARK:

Ultimate Mobile Edition (“ARK Mobile”):

○ 13.2

million downloads as of June 30, 2026

○ During

the second quarter of 2026, average DAU was 129,000

● Other

ARK IPs

○ Shared

new details around ARK: The Animated Series Part 2 at IGN Live

○ Unveiled

PixARK: Terracrypt, the largest paid DLC expansion for PixARK, planned to introduce

more than 200 hours of gameplay and 80 new creatures

Game

Portfolio and Business Updates:

● AAA

Game Pipeline

○ Officially

unveiled 9 Yin Sutra: Immortal at ChinaJoy 2026, revealing a new trailer and Steam

page

○ Announced

attendance at Gamescon 2026, where the Company will unveil a first look at an unannounced

internally developed AAA title, alongside ASA, For The Stars, Bellwright,

and Honeycomb: The World Beyond

○ Released

a new developer diary for For The Stars, offering an in-depth look at the game’s

current development progress, new pre-alpha footage, and previously unreleased concept art

● Bellwright

launched on PlayStation and Xbox

○ Reached

the Top 5 Paid Games list on Xbox following the console launch, demonstrating positive early

engagement

● Launched

Survivor Mercs 1.0 across Steam, Xbox, and PlayStation, and launched Above The

Snow on Steam

Business

and Operational Updates

● Egofold,

the Company’s subsidiary, publicly debuted the AI Ranch initiative and Non-Human PlayerTM

(NHP), an AI gaming companion for consumers, at the Ai4 2026 conference

● As

of June 30, 2026, SaltyTV released 300+ short film dramas

ARK

Content Pipeline

Title

Platforms

Type

Release

Schedule

ARK

Fantastic Tames – Cerberax

Steam,

Xbox, PlayStation

DLC

Creature

2026

ARK

Fantastic Tames – Enigmasour

Steam,

Xbox, PlayStation

DLC

Creature

2026

ARK

Dragontopia (content updates)

Steam,

Xbox, PlayStation

ASA

DLC

& Q4 2026

ARK

Maker

Steam,

Xbox, PlayStation

ASA

Content Creation Tool

2026

ARK

Survival of the Fittest

Steam,

Xbox, PlayStation

ASA

Game Mode

2026

PixARK:

Terracrypt

Steam,

Xbox, PlayStation, Nintendo Switch

PixARK

DLC

2026

PixARK

Worlds

Steam,

Xbox, PlayStation, Nintendo Switch 2

New

Title

2027

ARK

Atlantis

Steam,

Xbox, PlayStation

ASA

DLC

2027

ARK

Galaxy Wars

Steam,

Xbox, PlayStation

ASA

DLC

2027

ARK

Legacy of Santiago

Steam,

Xbox, PlayStation

ASA

DLC

2027

Diversified

Content Pipeline

Title

Platforms

Type

Release

Schedule

Dead

Party

Steam

Indie

Title

2026

Honeycomb:

The World Beyond

Steam

Indie

Title

2026

Veil

of Madness

Steam

Indie

Title

2026

Gobby

Gang

Steam

Indie

Title

2027

For

The Stars

Steam

AAA

Title

TBD

Yin Sutra: Immortal

Steam

AAA

Title

TBD

Yin Sutra: Wushu

Steam

AAA

Title

TBD

Management

Commentary

“Over

the last several months, we have begun executing against the robust gaming pipeline we previously outlined, which has established a strong

foundation for the second half of 2026,” said Snail CEO Hai Shi. “During the second quarter, we launched the ARK: Fantastic

Tames Season 1 Pack and brought Bellwright to Xbox and PlayStation, with the console launch providing an important contribution

during an otherwise measured quarter for new game releases. Shortly after the second quarter ended, we released three ARK DLC

expansion maps: Tides of Fortune, Genesis Part 1 Ascended, and Dragontopia. These launches, together with our broader slate

of planned ARK content, have established a strong foundation for the rest of the year. Additionally, we continue to invest in

our next generation of internally developed AAA titles, which we view as critical drivers of Snail’s long-term growth profile.

For The Stars and 9 Yin Sutra Immortal were showcased across select gaming events over the past several months, demonstrating

meaningful development progress and growing visibility for these titles as they move through the later stages of development.

“Operationally,

we have made significant progress across a new developing initiative that expands beyond traditional game development and publishing.

Just last week, we announced our attendance at the Ai4 2026 conference, where we unveiled the AI Ranch initiative and our new product

in development called Non-Human Player (NHP), an AI companion product for consumers designed to learn, adapt, and interact like a real

human teammate. NHP is designed to deliver a personalized gaming experience tailored to each user’s playstyle. We believe this

technology has the potential to address key challenges casual and hardcore gamers face while creating a personalized AI companion that

can help players enjoy and improve their gaming experience across multiple titles.

“The

outlook for the second half of 2026 remains strong as we continue to execute across multiple gaming pipelines and business opportunities.

With a strong slate of ARK content through 2027, meaningful progress across three upcoming AAA titles, and the introduction of new business

initiatives, we are well-positioned to support the transformation of Snail’s profile over the next several quarters.”

Second

Quarter 2026 Financial Highlights

Net

revenues were $19.7 million compared to $22.2 million in the same period last year. The decrease was primarily due to a $4.2 million

decrease in sales of ARK: Survival Ascended, a decrease of $1.8 million from ARK: Survival Evolved, a decrease of $0.4

million from ARK: Ultimate Mobile Edition, a decrease of $0.2 million from SaltyTV, and a decrease of $0.2 million from

other various titles, offset by an increase in revenues related to Bellwright of $1.5 million and $2.8 million change in deferred

revenues.

Total

units sold were 2.0 million units compared to 2.1 million units in the same period last year, primarily driven by lower sales of

ARK franchise titles of 0.2 million units, partially offset by an increase in sales of Bellwright of 0.1 million units.

Net

loss improved 81.6% to $3.0 million compared to a net loss of $16.6 million in the same period last year. The increase was primarily

due to a reduction of $14.0 million in the income tax provision from the prior-year quarter and an improvement in gross profit, partially

offset by higher general and administrative and research and development expenses.

Bookings

were $21.8 million compared to $27.1 million in the same period last year. The decrease was primarily due to lower sales of ARK: Survival

Ascended and ARK: Survival Evolved, partially offset by bookings generated from Bellwright.

EBITDA

was $(3.0) million compared to $(2.4) million in the same period last year. The decrease was primarily due to an improvement in net loss

of $13.5 million and a decrease in depreciation expense of $0.1 million, more than offset by a decrease in the provision of income taxes

of $14.0 million.

Six

Months 2026 Financial Highlights

Net

revenues increased 11.1% to $47.0 million compared to $42.3 million in the same period last year. The increase was primarily attributed

to a $3.6 million increase in sales of Bellwright and a $5.3 million change in deferred revenues, partially offset by a decrease

in ARK: Survival Evolved revenue of $2.7 million and a decrease of $1.4 million attributable to lower sales of ARK: Survival

Ascended.

Total

units sold increased 13.8% to 4.2 million units compared to 3.7 million units in the same period last year. The increase was primarily

due to increased sales of ARK: Survival Ascended of 1.0 million units and an increase in Bellwright of 0.2 million units;

partially offset by a decrease in ARK: Survival Evolved sales of 0.7 million units.

Net

loss improved 95.1% to $(0.9) million compared to $(18.5) million in the same period last year. The improvement was primarily due

to the absence of the $12.4 million income tax provision recorded in the prior-year period, which resulted from the valuation allowance

recognized against the Company’s deferred tax assets, together with a $6.5 million improvement in gross profit.

Bookings

were $48.7 million compared to $49.4 million in the same period last year. The decrease was primarily due to lower sales of ARK: Survival

Evolved as the title continued to mature and consumer demand shifted toward ARK: Survival Ascended and its related downloadable

content, partially offset by increased sales of ARK: Survival Ascended and Bellwright, which benefited from promotional

pricing during the period.

EBITDA

improved 88.8% to $(0.6) million compared to $(5.8) million in the same period last year. The improvement was primarily due to an

improvement in net loss of $17.6 million, partially offset by a decrease in the provision for income taxes of $12.4 million.

of June 30, 2026, unrestricted cash was $13.3 million compared to $8.6 million as of December 31, 2025.

Use

of Non-GAAP Financial Measures

addition to the financial results determined in accordance with U.S. generally accepted accounting principles, or GAAP, Snail believes

Bookings and EBITDA, as non-GAAP measures, are useful in evaluating its operating performance. Bookings and EBITDA are non-GAAP financial

measures that are presented as supplemental disclosures and should not be construed as alternatives to net income (loss) or revenue as

indicators of operating performance, nor as alternatives to cash flow provided by operating activities as measures of liquidity, both

as determined in accordance with GAAP. Snail supplementally presents Bookings and EBITDA because they are key operating measures used

by management to assess financial performance. Bookings adjusts for the impact of deferrals and, Snail believes, provides a useful indicator

of sales in a given period. Management believes Bookings and EBITDA are useful to investors and analysts in highlighting trends in Snail’s

operating performance. At the same time, other measures can differ significantly depending on long-term strategic decisions regarding

capital structure, the tax jurisdictions in which Snail operates, and capital investments.

Bookings

is defined as the net amount of products and services sold digitally or physically in the period. Bookings is equal to revenues, excluding

the impact from deferrals. Below is a reconciliation of total net revenue to Bookings, the closest GAAP financial measure.

Three Months Ended June 30,

Six Months Ended June 30,

2026

2025

2026

2025

(in millions)

Total net revenue

$ 19.7

$ 22.2

$ 47.0

$ 42.3

Change in deferred net revenue

2.1

4.9

1.7

7.1

Bookings

$ 21.8

$ 27.1

$ 48.7

$ 49.4

define EBITDA as net income (loss) before (i) interest expense, (ii) interest income, (iii) provision for (benefit from) income taxes

and (iv) depreciation expense. The following table provides a reconciliation from net income (loss) to EBITDA:

Three Months Ended June 30,

Six Months Ended June 30,

2026

2025

2026

2025

(in millions)

Net loss

$ (3.0 )

$ (16.6 )

$ (0.9 )

$ (18.5 )

Interest income and interest income – related parties

(0.1 )

—

(0.1 )

Interest expense

0.2

0.4

0.3

(Benefit from) provision for income taxes

(0.1 )

13.9

—

12.4

Depreciation expense

—

0.1

—

0.1

EBITDA

$ (3.0 )

$ (2.4 )

$ (0.6 )

$ (5.8 )

Webcast

Details

The

Company will host a webcast at 4:30 PM ET today to discuss its second quarter 2026 financial and operational results. Participants may

access the live webcast and replay via the link here or on the Company’s investor relations website at https://investor.snail.com/.

About

Snail, Inc.

Snail,

Inc. (Nasdaq: SNAL) is a leading, global independent developer and publisher of interactive digital entertainment for consumers around

the world, with a premier portfolio of premium games designed for use on a variety of platforms, including consoles, PCs, and mobile

devices. For more information, please visit: https://snail.com/.

Forward-Looking

Statements

This

press release contains statements that constitute forward-looking statements. Many of the forward-looking statements contained in this

press release can be identified by the use of forward-looking words such as “anticipate,” “believe,” “could,”

“expect,” “should,” “plan,” “intend,” “may,” “predict,” “continue,”

“estimate” and “potential,” or the negative of these terms or other similar expressions. Forward-looking statements

appear in a number of places in this press release and include, but are not limited to, statements regarding Snail’s intent, belief

or current expectations. These forward-looking statements include information about possible or assumed future results of Snail’s

business, financial condition, results of operations, liquidity, plans and objectives. The statements Snail makes regarding the following

matters are forward-looking by their nature: recent game launches and the Company’s broader slate of planned content establishing

a strong foundation for the rest of the year; the Company’s next generation of internally developed AAA titles serving as critical

drivers of Snail’s long-term growth profile; the For The Stars and 9 Yin Sutra Immortal titles demonstrating meaningful

development progress and growing visibility and moving through the later stages of development; the AI Ranch initiative and the

development of the Non-Human Player (NHP) product; the Company’s gaming pipeline being well-positioned to support the transformation

of the Company’s profile ;the Non-Human Player (NHP) having the potential to address key challenges casual and hardcore gamers

face while creating a personalized AI companion that can help players enjoy and improve their gaming experience across multiple titles;

and the outlook for the second half of 2026 remaining strong as Snail continues to execute across multiple gaming pipelines and business

opportunities.

Any

forward-looking statements included herein reflect our current views, and they involve certain risks and uncertainties, including, among

others, acceptance of our titles in the marketplace and the successful development, marketing or sale of our titles and our ability to

retain our key employees or maintain our Nasdaq listing. These risks should not be construed as exhaustive and should be read together

with the other cautionary statement included in our Annual Report on Form 10-K for the year ended December 31, 2025, subsequent Quarterly

Reports on Form 10-Q and current reports on Form 8-K filed with the Securities and Exchange Commission. Any forward-looking statement

speaks only as of the date on which it was initially made. We undertake no obligation to publicly update or revise any forward-looking

statement, whether as a result of new information, future events, changed circumstances or otherwise, unless required by law.

Investor

Contact:

John

Yi and Steven Shinmachi

Gateway

Group, Inc.

949-574-3860

SNAL@gateway-grp.com

Snail,

Inc. and Subsidiaries

Condensed

Consolidated Balance Sheets as of June 30, 2026 and December 31, 2025 (Unaudited)

June 30, 2026

December 31, 2025

ASSETS

Current Assets:

Cash and cash equivalents

$ 13,293,820

$ 8,568,164

Restricted cash and cash equivalents

562,000

187,000

Accounts receivable, net of allowances for credit losses of $523,500 as of June 30, 2026 and December 31, 2025

9,345,753

12,528,347

Loan and interest receivable – related party

108,751

107,759

Prepaid expenses – related party

5,793,460

2,700,474

Prepaid expenses and other current assets

1,621,428

2,232,485

Prepaid taxes

1,047,870

4,734,007

Total current assets

31,773,082

31,058,236

Restricted cash and cash equivalents, net of current portion

1,748,000

Prepaid expenses – related party, net of current portion

5,582,500

8,282,974

Property and equipment, net

4,120,607

4,146,175

Intangible assets, net

3,898,541

3,827,927

Intangible assets, net – related party

4,416,667

4,916,667

Other noncurrent assets, net

908,408

604,793

Operating lease right-of-use assets, net

4,687,027

4,722,366

Total assets

$ 57,134,832

$ 59,307,138

LIABILITIES, NONCONTROLLING INTERESTS AND STOCKHOLDERS’ DEFICIT

Current Liabilities:

Accounts payable

$ 3,926,768

$ 5,506,332

Accounts payable – related parties

18,426,220

20,067,013

Accrued expenses and other liabilities

3,939,436

3,364,150

Interest payable – related parties

527,770

Convertible notes at fair value

568,499

3,842,189

Current portion of long-term debt

1,353,296

1,305,880

Current portion of deferred revenue

28,538,494

14,799,840

Current portion of operating lease liabilities

472,345

393,448

Total current liabilities

57,752,828

49,806,622

Accrued expenses

625,354

468,106

Revolving loan

2,500,000

5,000,000

Long-term debt, net of current portion

3,650,745

4,292,538

Deferred revenue, net of current portion

5,276,523

17,282,685

Operating lease liabilities, net of current portion

4,328,864

4,336,240

Total liabilities

74,134,314

81,186,191

Commitments and contingencies

Stockholders’ Deficit:

Class A common stock, $0.0001 par value, 500,000,000 shares authorized; 3,363,834 shares issued and 3,093,778 shares outstanding as of June 30, 2026, and 2,076,467 shares issued and 1,806,412 shares outstanding as of December 31, 2025

336

208

Class B common stock, $0.0001 par value, 100,000,000 shares authorized; 5,749,716 shares issued and outstanding as of June 30, 2026 and December 31, 2025

575

Additional paid-in capital

32,732,935

26,926,245

Accumulated other comprehensive loss

(295,578 )

(275,049 )

Accumulated deficit

(40,258,553 )

(39,352,510 )

Treasury stock at cost (270,055 shares as of June 30, 2026 and December 31, 2025)

(3,671,806 )

Total Snail, Inc. deficit

(11,492,091 )

(16,372,337 )

Noncontrolling interests

(5,507,391 )

(5,506,716 )

Total stockholders’ deficit

(16,999,482 )

(21,879,053 )

Total liabilities, noncontrolling interests and stockholders’ deficit

$ 57,134,832

$ 59,307,138

Snail,

Inc. and Subsidiaries

Condensed

Consolidated Statements of Operations and Comprehensive Loss for the Three and Six Months Ended June 30, 2026 and 2025 (Unaudited)

Three Months Ended June 30,

Six Months Ended June 30,

2026

2025

2026

2025

Revenues, net

$ 19,676,448

$ 22,185,750

$ 46,971,102

$ 42,296,622

Cost of revenues

11,988,665

15,231,005

27,626,878

29,494,350

Gross profit

7,687,783

6,954,745

19,344,224

12,802,272

Operating expenses:

General and administrative

4,975,250

3,475,089

9,626,007

8,439,440

Research and development

4,453,153

3,293,409

8,467,822

6,903,154

Advertising and marketing

814,705

1,520,201

1,683,494

2,826,567

Depreciation and amortization

12,834

67,761

25,568

135,665

Impairment of film assets

96,838

415,719

165,987

415,719

Total operating expenses

10,352,780

8,772,179

19,968,878

18,720,545

Loss from operations

(2,664,997 )

(1,817,434 )

(624,654 )

(5,918,273 )

Other income (expense):

Interest income

58,235

31,972

100,082

61,878

Interest income – related party

499

992

Interest expense

(152,125 )

(169,286 )

(358,171 )

(250,115 )

Other (expense) income

(415,082 )

(707,968 )

(60,031 )

61,794

Foreign currency transaction gain (loss)

(1,433 )

(31,891 )

8,259

(68,179 )

Total other expense, net

(509,906 )

(876,674 )

(308,869 )

(193,630 )

Loss before provision for income taxes

(3,174,903 )

(2,694,108 )

(933,523 )

(6,111,903 )

Provision for (benefit from) income taxes

(133,629 )

13,868,598

(26,805 )

12,397,768

Net loss

(3,041,274 )

(16,562,706 )

(906,718 )

(18,509,671 )

Net loss attributable to non-controlling interests

(525 )

(282 )

(675 )

(1,238 )

Net loss attributable to Snail, Inc.

(3,040,749 )

(16,562,424 )

(906,043 )

(18,508,433 )

Comprehensive loss statement:

Net loss

(3,041,274 )

(16,562,706 )

(906,718 )

(18,509,671 )

Other comprehensive income (loss) related to foreign currency translation adjustments, net of tax

984

30,587

(25,839 )

63,820

Other comprehensive income related to credit adjustments, net of tax

—

5,310

22,023

Total comprehensive loss

$ (3,040,290 )

$ (16,532,119 )

$ (927,247 )

$ (18,423,828 )

Net loss attributable to Class A common stockholders:

Basic

$ (989,812 )

$ (3,775,300 )

$ (258,255 )

$ (4,210,496 )

Diluted

$ (989,812 )

$ (3,775,300 )

$ (258,255 )

$ (4,216,414 )

Net loss attributable to Class B common stockholders:

Basic

$ (2,050,937 )

$ (12,787,124 )

$ (647,788 )

$ (14,297,937 )

Diluted

$ (2,050,937 )

$ (12,787,124 )

$ (647,788 )

$ (14,318,033 )

Loss per share attributable to Class A and B common stockholders:

Basic

$ (0.36 )

$ (2.22 )

$ (0.11 )

$ (2.49 )

Diluted

$ (0.36 )

$ (2.22 )

$ (0.11 )

$ (2.49 )

Weighted-average shares used to compute income (loss) per share attributable to Class A common stockholders:

Basic

2,774,897

1,697,559

2,292,247

1,693,192

Diluted

2,774,897

1,697,559

2,292,247

1,693,507

Weighted-average shares used to compute income (loss) per share attributable to Class B common stockholders:

Basic

5,749,716

Diluted

5,749,716

Snail,

Inc. and Subsidiaries

Condensed

Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2026 and 2025 (Unaudited)

2026

2025

Cash flows from operating activities:

Net loss

$ (906,718 )

$ (18,509,671 )

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Amortization – intangible assets, net

327,756

79,424

Amortization – intangible assets, net – related party

500,000

—

Amortization – film assets

231,917

645,069

Amortization – loan origination fees and debt discounts

4,932

(19,504 )

Loss on change in fair value of convertible notes

121,165

82,180

Gain on change in fair value of warrant liabilities

(39,243 )

(91,383 )

Depreciation – property and equipment

25,568

135,667

Impairment of film assets

165,987

415,719

Gain on remeasurement of previously held equity interest

—

(7,857 )

Gain on lease termination

(1,799 )

—

Stock-based compensation expense

101,130

280,888

Deferred taxes, net

—

10,808,885

Changes in assets and liabilities, net of business acquisitions:

Accounts receivable

3,182,594

(7,825,905 )

Accounts receivable – related party

—

3,836,866

Prepaid expenses – related party

(392,512 )

(1,728,666 )

Prepaid expenses and other current assets

611,057

537,799

Prepaid taxes

3,686,137

1,161,649

Other noncurrent assets, net

(696,951 )

(1,064,165 )

Accounts payable

(1,636,164 )

(110,912 )

Accounts payable – related parties

(1,640,793 )

1,040,862

Accrued expenses and other liabilities

1,378,317

1,009,796

Loan and interest receivable – related party

(992 )

Lease liabilities

108,659

(163,920 )

Deferred revenue

1,732,492

7,075,046

Net cash provided by (used in) operating activities

6,862,539

(2,413,125 )

Cash flows from investing activities:

Acquisition of software

—

(290,000 )

Acquisition of software licenses

(343,770 )

(2,008,690 )

Investments in software

—

(718,236 )

Net cash paid for acquisition of Matrioshka

—

(9,719 )

Net cash used in investing activities

(343,770 )

(3,026,645 )

Cash flows from financing activities:

Proceeds from at-the-market offering, net of issuance costs

4,232,897

—

Repayments on notes payable

(594,376 )

—

Repayments on convertible notes

(2,523,295 )

(638,753 )

Repayments on revolving loan

(2,500,000 )

(43,018 )

Borrowings on term loan

—

3,500,000

Cash proceeds from exercise of warrants

—

159,000

Proceeds from issuance of convertible notes

—

3,000,000

Payments of loan origination fees

(7,500 )

—

Net cash provided by (used in) financing activities

(1,392,274 )

5,977,229

Effect of foreign currency translation on cash and cash equivalents

(25,839 )

64,023

Net increase in cash and cash equivalents, and restricted cash and cash equivalents

5,100,656

601,482

Cash and cash equivalents, and restricted cash and cash equivalents – beginning of the period

10,503,164

8,238,944

Cash and cash equivalents, and restricted cash and cash equivalents – end of the period

$ 15,603,820

$ 8,840,426

Supplemental disclosures of cash flow information

Cash paid during the period for:

Interest

$ 311,933

$ 230,318

Income taxes

$ 82,428

$ 612,007

Noncash transactions during the period for:

Liabilities converted to equity upon exercise of warrants

$ 606,541

$ 323,113

Acquisition of film licenses in accounts payable

$ 2,000

$ 86,069

Acquisition of software and software licenses in accounts payable and accrued expenses

$ 54,600

$ 313,282

Change in fair value of notes recorded in accumulated other comprehensive income

$ 5,310

$ 22,023

Right-of-use assets obtained in exchange for lease liability

$ (297,000 )

$ (55,267 )

Net assets acquired in a business combination

$ —

$ 5,461

Debt converted to equity

$ 866,250

—

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