SEGMENT REPORTING

12 Months Ended

Dec. 31, 2023

Segment Reporting [Abstract]

SEGMENT REPORTING

NOTE 15 – SEGMENT REPORTING

The Company’s principal operating segments coincide with the types of products and services to be sold. The products and services from which revenues are derived are consistent with the reporting structure of the Company’s internal organization. The Company’s two reportable segments for the years ended December 31, 2023 and 2022 were (i) the development and publishing of interactive racing video games, entertainment content and services (the “Gaming segment”); and (ii) the organization and facilitation of esports tournaments, competitions and events for the Company’s licensed racing games as well as on behalf of third-party video game racing series and other video game publishers (the “esports segment”). The Company’s CODM has been identified as the Company’s Chief Executive Officer, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Segment information is presented based upon the Company’s management organization structure as of December 31, 2023 and the distinctive nature of each segment. Future changes to this internal financial structure may result in changes to the reportable segments disclosed. There are no inter-segment revenue transactions and, therefore, revenues are only to external customers. As the Company primarily generates its revenues from customers in the United States, no geographical segments are presented.

Segment operating profit is determined based upon internal performance measures used by the CODM. The Company derives the segment results from its internal management reporting system. The accounting policies the Company uses to derive reportable segment results are the same as those used for external reporting purposes. Management measures the performance of each reportable segment based upon several metrics, including net revenues, gross profit and operating loss. Management uses these results to evaluate the performance of, and to assign resources to, each of the reportable segments. The Company manages certain operating expenses separately at the corporate level and does not allocate such expenses to the segments. Segment income from operations excludes interest income/expense and other income or expenses and income taxes according to how a particular reportable segment’s management is measured. Management does not consider impairment charges, and unallocated costs in measuring the performance of the reportable segments.

Segment information available with respect to these reportable business segments was as follows:

	For the Year Ended December 31,
	2023			2022
Revenues:
Gaming	$	6,619,502		$	9,144,639
Esports		290,172			1,179,920
Total Revenues	$	6,909,674		$	10,324,559
Cost of Revenues:
Gaming	$	3,245,740		$	4,080,724
Esports		374,755			879,593
Total Cost of Revenues	$	3,620,495		$	4,960,317
Gross Profit (Loss):
Gaming	$	3,373,762		$	5,063,915
Esports		(84,583	)		300,327
Total Gross Profit	$	3,289,179		$	5,364,242
Loss From Operations:
Gaming	$	(18,859,126	)	$	(34,402,894	)
Esports		(549,979	)		(623,510	)
Total Loss From Operations	$	(19,409,105	)	$	(35,026,404	)
Depreciation and Amortization:
Gaming	$	349,236		$	385,426
Esports		49,465			34,711
Total Depreciation and Amortization	$	398,701		$	420,137
Interest Expense, net:
Gaming	$	(772,989	)	$	(1,148,204	)
Esports		-			-
Total Interest Expense, net	$	(772,989	)	$	(1,148,204	)
Other Expense (Income), net:
Gaming	$	5,858,338		$	(652,338	)
Esports		571			(13,508	)
Total Other Expense (Income), net:	$	5,858,909		$	(665,846	)
Net Loss:
Gaming	$	(13,773,777	)	$	(36,203,435	)
Esports		(549,408	)		(637,019	)
Total Net Loss	$	(14,323,185	)	$	(36,840,454	)

	December 31, 2023		December 31, 2022
Total Assets:
Gaming	$	7,892,388	$	16,315,359
Esports		1,866,316		2,582,433
Total Assets	$	9,758,704	$	18,897,792