2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Since the Annual Report for the year ended December 31, 2023, there have been no material changes to the Company’s significant accounting policies, except as disclosed in this note.

LIQUIDITY

As of September 30, 2024, the Company had cash and cash equivalents of $64,584 and working capital of $96,596 During the three and nine months ended September 30, 2024, the Company incurred a net loss of $87,389 and $124,621, respectively. During the nine months ended September 30, 2024, the Company used cash in operating activities of $34,830.

During the nine months ended September 30, 2024, the Company sold an aggregate of 8,177,472 shares of common stock under an “at-the-market” equity offering program for aggregate gross proceeds of $25,651, less issuance costs of $581. See Note 5 – Stockholders’ Equity.

The Company has not yet achieved profitability and expects to continue to incur cash outflows from operations. Historically, the Company has been able to raise funds to support its business operations, although there can be no assurance that it will be successful in raising significant additional funds in the future. The Company expects that its cash on hand will fund its operations for at least 12 months after the issuance date of these financial statements.

Since inception, the Company’s operations have primarily been funded through proceeds received in equity and debt financing. The Company believes it has access to capital resources and continues to evaluate additional financing opportunities. There is no assurance that the Company will be able to obtain funds on commercially acceptable terms, if at all. There is also no assurance that the amount of funds the Company might raise will enable the Company to complete its development initiatives or attain profitable operations.

The Company’s operating needs include the planned costs to operate its business, including amounts required to fund working capital and capital expenditures. The Company’s future capital requirements and the adequacy of its available funds will depend on many factors, including the Company’s ability to successfully commercialize its products and services, competing technological and market developments, and the need to enter into collaborations with other companies or acquire other companies or technologies to enhance or complement its product and service offerings. The Company is executing its plan designed to improve the Company’s liquidity by enhancing revenue economics, increasing gross profit through product optimization, integration of acquisitions, and reduction of operating expenses through cost avoidance and cost cutting strategies. There can be no assurances that these strategies will be achieved.

INVENTORY

As of September 30, 2024, the Company’s inventory was comprised $24,812 of finished goods that were available for sale and $17,500 of raw material and work in process. As of December 31, 2023, the Company’s inventory was comprised of $33,902 of finished goods that were available for sale and $14,040 of raw material and work in process.

FOREIGN CURRENCY TRANSLATION

Transaction losses attributable to foreign exchange were $389 and $434 during the three and nine months ended September 30, 2024, respectively. Transaction gains attributable to foreign exchange were $144 and $925 during the three and nine months ended September 30, 2023, respectively. Transaction gains and losses attributable to foreign exchange are included within general and administrative expenses on the condensed consolidated statements of operations for the three and nine months ended September 30, 2024 and 2023.

ASSETS HELD FOR SALE

The Company initially measures an asset that is classified as held for sale at the lower of its carrying amount or fair value less costs to sell. The Company assesses the fair value of an asset less costs to sell each reporting period that it remains classified as held for sale, and reports any subsequent changes as an adjustment to the carrying amount of the asset. Assets are not depreciated or amortized while they are classified as held for sale.

Office Space

During the first quarter of 2024, the Company commenced plans to sell its approximately 10,000 square feet of office space in Miami Beach, Florida. The asset is included within property and equipment on the condensed consolidated balance sheet as of September 30, 2024. The asset’s carrying value was $3,781 and $3,692 as of September 30, 2024 and December 31, 2023, respectively. The Company recorded a loss on sale of $459 within general and administrative expenses during the three and nine months ended September 30, 2024. Subsequent to September 30, 2024, the Company completed the sale of its office space in Miami Beach, Florida for approximately $3,425 of proceeds.

Underperforming Subsidiary

During the first quarter of 2024, the Company’s Board of Directors approved a plan for the sale of underperforming assets of a subsidiary. On April 30, 2024, the Company entered into an agreement to sell installed and inventory charging units and the associated agreements with existing customers, hosts, and drivers. This transaction was completed and funded on July 3, 2024. As a result, the Company recorded a loss of $262 and $945 for the three and nine months ended September 30, 2024, respectively, which is included in operating expenses on the accompanying condensed consolidated statements of operations. The Company elected not to present this underperforming subsidiary as discontinued operations because it is not material to the Company’s condensed consolidated financial statements.

BLINK CHARGING CO.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands except for share and per share amounts)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED

REVENUE RECOGNITION

The Company recognizes revenue primarily from the following:

The following table summarizes revenue recognized in the condensed consolidated statements of operations:

 SCHEDULE OF REVENUE RECOGNITION BY CONTRACT

The following table summarizes our revenue recognized in the condensed consolidated statements of operations by geographical area:

 SCHEDULE OF REVENUE RECOGNITION BY GEOGRAPHICAL AREA

The timing of the Company’s revenue recognition may differ from the timing of payment by its customers. A receivable is recorded when revenue is recognized prior to payment and the Company has an unconditional right to payment. Alternatively, when payment precedes the provision of the related services, the Company records deferred revenue until the performance obligations are satisfied.

As of September 30, 2024, the Company had $32,285 related to contract liabilities where performance obligations have not yet been satisfied, which has been included within deferred revenue on the condensed consolidated balance sheets as of September 30, 2024. The Company expects to satisfy $16,330 of its remaining performance obligations for network fees, warranty revenue, product sales, and other and recognize the revenue within the next twelve months.

The Company has elected to apply the practical expedient to expense costs to obtain contracts at the time the liability is incurred when the expected amortization period is one year or less.

During the three and nine months ended September 30, 2024, the Company recognized $2,860 and $7,932 of revenues, respectively, related to network fees and warranty contracts, which were included in deferred revenues as of December 31, 2023. During the three and nine months ended September 30, 2024, there was no revenue recognized from performance obligations satisfied (or partially satisfied) in previous periods as specified by ASC 606-10-50-12A.

BLINK CHARGING CO.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands except for share and per share amounts)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED

REVENUE RECOGNITION – CONTINUED

Grants, rebates and alternative fuel credits, which are not within the scope of ASC 606, pertaining to revenues and periodic expenses are recognized as income when the related revenue and/or periodic expense are recorded. Grants and rebates related to EV charging stations and their installation are deferred and amortized in a manner consistent with the related depreciation expense of the related asset over their useful lives over the useful life of the charging station. During the three months ended September 30, 2024 and 2023, the Company recognized $117 and $65 respectively, of revenue related to alternative fuel credits. During the nine months ended September 30, 2024 and 2023, the Company recognized $192 and $168, respectively, of revenue related to alternative fuel credits.

Car-sharing services is accounted for under ASC Topic 842, Leases, and pertains to revenues and expenses related to a car-sharing services agreement with the City of Los Angeles which allows customers the ability to rent electric vehicles through a subscription service. The Company accounts for such rentals as operating leases. The lease terms are included in the Company’s contracts, and the determination of whether the Company’s contracts contain leases generally does not require significant assumptions or judgments. The Company’s lease revenues do not include material amounts of variable payments. The Company does not provide an option for the lessee to purchase the rented equipment at the end of the lease.

The Company is unsure of when the customer will return rented equipment. As such, the Company does not know how much the customer will owe it upon return of the equipment and, therefore, cannot provide a maturity analysis of future lease payments. The Company’s equipment is generally rented for short periods of time (generally a few minutes to a few hours). Lessees do not provide residual value guarantees on rented equipment.

The Company expects to derive significant future benefits from its equipment following the end of the rental term. The Company’s equipment is typically rented for the majority of the time that the Company owns it. The Company recognizes revenue over the contractual period of performance of the subscription which are short term in nature.

CONCENTRATIONS

During the three months ended September 30, 2024, sales to a significant customer represented 16% of total revenue.

During the three months ended September 30, 2024 and 2023, the Company made purchases from a significant supplier that represented less than 10% and 17% of total purchases, respectively. During the nine months ended September 30, 2024 and 2023, the Company made purchases from the same significant supplier that represented 15% and 20% of total purchases, respectively. As of September 30, 2024, accounts payable to a significant vendor represented 10% of total accounts payable. As of December 31, 2023, accounts payable to two significant vendors were approximately 16% and 10% of total accounts payable.

RECLASSIFICATIONS

Certain prior year balances have been reclassified in order to conform to current year presentation. These reclassifications have no effect on previously reported results of operations or loss per share.

NET LOSS PER COMMON SHARE

Basic net loss per common share is computed by dividing net loss attributable to common shareholders by the weighted average number of common shares outstanding during the period. Diluted net loss per common share is computed by dividing net loss attributable to common shareholders by the weighted average number of common shares outstanding, plus the number of additional common shares that would have been outstanding if the common share equivalents had been issued (computed using the treasury stock or if converted method), if dilutive.

The following common share equivalents are excluded from the calculation of weighted average common shares outstanding because their inclusion would have been anti-dilutive:

 SCHEDULE OF OUTSTANDING DILUTED SHARES EXCLUDED FROM DILUTED LOSS PER SHARE COMPUTATION

RECENTLY ISSUED ACCOUNTING STANDARDS

In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2024-03 to require more detailed information about specified categories of expenses (purchases of inventory, employee compensation, depreciation, amortization, and depletion) included in certain expense captions presented on the face of the income statement. This ASU is effective for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The amendments may be applied either (1) prospectively to financial statements issued for reporting periods after the effective date of this ASU or (2) retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating the impact of adopting this guidance on its condensed consolidated financial statements and related disclosures.

BLINK CHARGING CO.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands except for share and per share amounts)