SHARE-BASED COMPENSATION (Tables)
|
6 Months Ended |
Jun. 30, 2026 |
| Share-Based Payment Arrangement [Abstract] |
|
| SCHEDULE OF FAIR VALUE ASSUMPTION |
The
following table presents the weighted-average assumptions, weighted average grant date fair value, and the range of expected price volatility
used in determining the fair value of the non-employee director liability-classified awards as of June 30, 2026 and December 31, 2025:
SCHEDULE
OF FAIR VALUE ASSUMPTION
| | |
As
of June
30, 2026 | |
|
As of
December 31, 2025
|
|
| Risk-free
interest rate | |
| 4.19 | % |
|
|
3.73 |
% |
| Expected
volatility | |
| 90
- 160 | % |
|
|
90 - 160 |
% |
| Weighted-average
volatility | |
| 112 | % |
|
|
115 |
% |
| Expected
term | |
| 4
- 5.3 years | |
|
|
4 - 5.48 years |
|
| Expected
dividends | |
| None | |
|
|
None |
|
| Weighted-average
grant date fair value per share | |
$ | 3.58 | |
|
$ |
2.73 |
|
|
| SCHEDULE OF FAIR VALUE, ASSETS AND LIABILITIES MEASURED ON RECURRING BASIS |
The
following table presents the Company’s liabilities measured at fair value on a recurring basis as of June 30, 2026 and December
31, 2025:
SCHEDULE
OF FAIR VALUE, ASSETS AND LIABILITIES MEASURED ON RECURRING BASIS
| | |
Quoted
prices in active markets for identical liabilities
(Level
1) | | |
Significant
other observable inputs
(Level
2) | | |
Significant
unobservable inputs
(Level
3) | | |
Total
Fair Value | |
| | |
Fair
value measurements at reporting date using: | |
| | |
Quoted
prices in active markets for identical liabilities
(Level
1) | | |
Significant
other observable inputs
(Level
2) | | |
Significant
unobservable inputs
(Level
3) | | |
Total
Fair Value | |
| As of June 30, 2026: | |
| | | |
| | | |
| | | |
| | |
| Non-employee director compensation awards | |
$ | - | | |
$ | - | | |
$ | 1,201,995 | | |
$ | 1,201,995 | |
| | |
| | | |
| | | |
| | | |
| | |
| As of December 31,
2025: | |
| | | |
| | | |
| | | |
| | |
| Non-employee director compensation awards | |
$ | - | | |
$ | - | | |
$ | 789,320 | | |
$ | 789,320 | |
|
| SCHEULE OF RECONCILIATION OF LIABILITIES MEASURED AT FAIR VALUE ON A RECURRING BASIS |
A reconciliation of liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) is as follows:
SCHEULE
OF RECONCILIATION OF LIABILITIES MEASURED AT FAIR VALUE ON A RECURRING BASIS
| | |
| | |
| Balance at January 1, 2026 | |
$ | 789,320 | |
| Balance | |
$ | 789,320 | |
| Non-cash director compensation (see Stock-Based Compensation below) | |
| 412,675 | |
| Balance at June 30, 2026 | |
$ | 1,201,995 | |
| Balance | |
$ | 1,201,995 | |
|
| SCHEDULE OF STOCK BASED COMPENSATION EXPENSE |
The
following table summarizes stock-based compensation expense resulting from awards included in the Company’s condensed consolidated
statements of operations:
SCHEDULE
OF STOCK BASED COMPENSATION EXPENSE
| | |
2026 | | |
2025 | | |
2026 | | |
2025 | |
| | |
For the Three Months Ended
June 30, | | |
For the Six Months Ended
June 30, | |
| | |
2026 | | |
2025 | | |
2026 | | |
2025 | |
| General and Administrative | |
$ | 37,644 | | |
$ | - | | |
$ | 412,675 | | |
$ | - | |
| Sales and Marketing | |
| - | | |
| - | | |
| - | | |
| - | |
| Development | |
| - | | |
| - | | |
| - | | |
| - | |
| Stock-based compensation expense | |
$ | 37,644 | | |
$ | - | | |
$ | 412,675 | | |
$ | - | |
|
| SCHEDULE OF CALCULATED BASIC AND DILUTED NET INCOME PER COMMON SHARE |
For
the three and six months ended June 30, 2026 and 2025, respectively, the Company calculated basic and diluted net income per Class A
common share as follows:
SCHEDULE
OF CALCULATED BASIC AND DILUTED NET INCOME PER COMMON SHARE
| | |
2026 | | |
2025 | |
| | |
For
the Three Months Ended June 30, | |
| | |
2026 | | |
2025 | |
| Numerator: | |
| | |
| |
| Net
income attributable to Motorsport Games Inc. | |
$ | 401,463 | | |
$ | 4,258,400 | |
| | |
| | | |
| | |
| Denominator: | |
| | | |
| | |
| Weighted
average Class A common shares outstanding – basic (1) | |
| 4,760,598 | | |
| 5,206,536 | |
| | |
| | | |
| | |
| Effects
of dilutive securities: | |
| | | |
| | |
| Assumed
exercise of stock options, treasury stock method | |
| 31,668 | | |
| - | |
| Assumed
exercise of warrants, treasury stock method | |
| 462,747 | | |
| - | |
| Weighted
average dilutive potential common shares | |
| 494,415 | | |
| - | |
| | |
| | | |
| | |
| Weighted
average Class A common shares outstanding - diluted | |
| 5,255,013 | | |
| 5,206,536 | |
| | |
| | | |
| | |
| Net
income per Class A common share - basic | |
$ | 0.08 | | |
$ | 0.82 | |
| Net
income per Class A common share - diluted | |
$ | 0.08 | | |
$ | 0.82 | |
| | |
2026 | | |
2025 | |
| | |
For
the Six Months Ended June 30, | |
| | |
2026 | | |
2025 | |
| Numerator: | |
| | |
| |
| Net
income attributable to Motorsport Games Inc. | |
$ | 717,290 | | |
$ | 5,299,458 | |
| | |
| | | |
| | |
| Denominator: | |
| | | |
| | |
| Weighted
average Class A common shares outstanding – basic (1) | |
| 5,106,520 | | |
| 4,195,047 | |
| | |
| | | |
| | |
| Effects
of dilutive securities: | |
| | | |
| | |
| Assumed
exercise of stock options, treasury stock method | |
| 29,100 | | |
| - | |
| Assumed
exercise of warrants, treasury stock method | |
| 435,333 | | |
| - | |
| Weighted
average dilutive potential common shares | |
| 464,433 | | |
| - | |
| | |
| | | |
| | |
| Weighted
average Class A common shares outstanding - diluted | |
| 5,570,953 | | |
| 4,195,047 | |
| | |
| | | |
| | |
| Net
income per Class A common share - basic | |
$ | 0.14 | | |
$ | 1.26 | |
| Net
income per Class A common share - diluted | |
$ | 0.13 | | |
$ | 1.26 | |
| |
(1) |
Includes
the weighted average number of 377,836 shares issuable upon the exercise of pre-funded warrants issued on April 11, 2025. |
|
| SCHEDULE OF CALCULATION WEIGHTED AVERAGE DILUTIVE COMMON SHARES |
The
following shares were excluded from the calculation of weighted average dilutive common shares because their inclusion would have been
anti-dilutive.
SCHEDULE
OF CALCULATION WEIGHTED AVERAGE DILUTIVE COMMON SHARES
| | |
2026 | | |
2025 | | |
2026 | | |
2025 | |
| | |
For
the Three Months Ended
June
30, | | |
For
the Six Months Ended June
30, | |
| | |
2026 | | |
2025 | | |
2026 | | |
2025 | |
| Stock
options (1) | |
| 40,626 | | |
| 96,828 | | |
| 40,626 | | |
| 96,828 | |
| Warrants
(2) | |
| 33,574 | | |
| 33,574 | | |
| 33,574 | | |
| 33,574 | |
| Dilutive
securities | |
| 74,200 | | |
| 130,402 | | |
| 74,200 | | |
| 130,402 | |
| (1) |
Represents
stock options excluded from the computation of diluted net income per share because their inclusion would have been
anti-dilutive. The weighted average exercise price for anti-dilutive options was $30.89 for each of the three and six months ended June
30, 2026, respectively. |
| |
|
| (2) |
Represents
warrants excluded from the computation of diluted net income per share because their inclusion would have been anti-dilutive
and excludes pre-funded warrants which are included in basic weighted average shares outstanding. The exercise price for the anti-dilutive
warrants range from $21.74 to $29.38. |
|