Frequency Holdings Inc

What they do

The company operates ReachOut Digital Intelligence (RDI), a cybersecurity and IT services business founded by Rick Jordan that serves small and medium-sized businesses nationally. Services include 24/7 threat monitoring, compliance support and AI-driven automation, sold predominantly through subscription arrangements. The company states it is expanding beyond traditional IT services, including an announced blockchain-based identity management platform called TRUSTLESS. It also describes itself as transitioning into a diversified technology holding company.

Revenue drivers

• RDI managed cybersecurity subscriptions — Recurring subscription revenue for 24/7 threat monitoring, compliance support and AI-driven automation sold to SMB customers; this is the flagship operating business.
• Acquired operations (RedGear, Singer Networks) — MD&A attributes the 2024 revenue increase to the October 2023 acquisition of RedGear and the April 2024 asset acquisition of Singer Networks.
• TRUSTLESS (announced, not yet operating) — Described in the 10-Q MD&A as an upcoming blockchain-based identity management venture intended to diversify revenue; no revenue is reported from it.

Recent performance

Full-year 2024 revenue was $4,811,040 versus $3,775,142 in 2023, which MD&A attributes to the RedGear and Singer Networks acquisitions. Cost of goods sold fell to $1,835,859 from $2,564,093, which the company credits to efficiency, reduced costs and more automated software-based solutions. 2024 net income was $4,395,134 against a 2023 net loss of $22,906,015, a swing MD&A says was driven primarily by a large fair market value change and a gain on debt extinguishment. Other expense was $10,053,812 in 2024, including $1,753,453 of interest expense and a $9,177,239 derivative expense and fair value change. Operating cash flow remained negative at $927,998 used in 2024 and $762,097 used in 2023.

Strategy

Management describes a shift from acquiring larger entities to targeting smaller, high-potential firms for faster integration into RDI's platform. It emphasizes AI and automation to reduce costs and improve service delivery, and says it aims to build a nationally recognized brand offering enterprise-grade cybersecurity to SMBs. The company also states it is expanding beyond IT services under a holding company model, with the announced TRUSTLESS identity platform as an example. Management references emulating a customer-centric approach similar to T-Mobile and states an objective of a successful uplisting to NASDAQ.

Risks

• Negative operating cash flow — Operating activities used $927,998 of cash in 2024 and $762,097 in 2023, so the business consumed cash rather than generating it.
• Working capital deficiency and going-concern risk — At September 30, 2025 the company reported total assets of $102,291, total liabilities of $5.7 million and shareholder equity of negative $6.0 million, with only $30,155 of cash.
• Derivative and interest expense volatility — 2024 other expense of $10,053,812 included $9,177,239 for initial derivative expense and change in fair value of derivatives and $1,753,453 of interest expense, so reported net income is heavily affected by non-operating items.
• Impairment and thin margins on acquired assets — Intangibles impairment was $3,464,930 in 2024 and $4,136,746 in 2023, indicating acquired assets have been repeatedly written down.

Outlook

Management states it is targeting an uplisting to NASDAQ and expanding its portfolio beyond traditional IT services through the announced TRUSTLESS blockchain-based identity platform. MD&A says the shift toward acquiring smaller, high-potential firms is intended to enable faster integration and scalability. The company does not provide specific revenue or earnings guidance in the excerpts reviewed. The 10-Q refers investors to the risk factors in the 10-K filed April 15, 2025.