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INTANGIBLE ASSETS AND GOODWILL
 9 Months Ended
Sep. 30, 2025
Goodwill and Intangible Assets Disclosure [Abstract]  
INTANGIBLE ASSETS AND GOODWILL

NOTE 5 – INTANGIBLE ASSETS AND GOODWILL

 

Impairments

 

During the quarter ended September 30, 2025, the Company conducted an interim impairment test of its goodwill and other intangibles due to a decline in operating performance and a sustained decline in its stock price. As part of the analysis, the Company updated the forecasted future cash flows and revenues in the impairment assessment to reflect current conditions. Based on the results of the impairment test performed, the Company recognized a full goodwill impairment charge of $684,867 and an other intangibles impairment charge of $146,001 during the three and nine months ended September 30, 2025. No impairment charges were recognized during the three and nine months ended September 30, 2024.

 

Intangible assets

 

As a result of the acquisition of Safe Pro AI on March 9, 2023, there was a $545,625 increase in the gross intangible assets made up of $545,625 of finite lived intangible assets, consisting of a single software asset, SpotlightAI™. Spotlight AI detects threats from drone imagery, relaying precise GPS location and actionable reporting information to decision makers and ground personnel. The Company intends to utilize its AI, ML and computer vision technology to create and analyze large datasets. The Company’s technology is being used in the field by the Ukrainian government, as well as several humanitarian aid organizations.

 

During the three and nine months ended September 30, 2025, the Company capitalized $2,702 and $207,545, respectively of its direct costs. As of September 30, 2025 and September 30, 2024, the Company had $903,695 and $1,088,645, respectively, of finite lived intangible assets, net.

 

As of September 30, 2025, intangible assets subject to amortization consisted of the following:

 

   September 30, 2025 
   Amortization
period
(years)		  Gross
Amount		   Accumulated
Amortization		   Net finite
intangible
assets		 
Customer relationships  5  $388,000   $(388,000)  $- 
Contractual employment agreements  3   310,000    (310,000)   - 
Acquired capitalized internal-use software development costs  3   1,125,758    (222,063)   903,695 
Amortization of intangible assets      $1,823,758   $(920,063)  $903,695 

 

 

SAFE PRO GROUP INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024

(unaudited)

 

For the three and nine months ended September 30, 2025, amortization of intangible assets amounted to $72,167 and $246,493, respectively. For the three and nine months ended September 30, 2024, amortization of intangible assets amounted to $81,352 and $171,735, respectively. For the three and nine months ended September 30, 2025, impairment of intangible assets amounted to $146,001. There were no impairment charges during the three and nine months ended September 30, 2024.

 

As of December 31, 2024, intangible assets subject to amortization consisted of the following:

 

   December 31, 2024 
  

Amortization

period

(years)

  Gross
Amount		  

Accumulated

Amortization

  

Net finite

intangible

assets

 
Customer relationships  5  $388,000   $(183,819)  $204,181 
Contractual employment agreements  3   310,000    (271,337)   38,663 
Acquired capitalized internal-use software development costs  3   918,213    (72,412)   845,801 
Amortization of intangible assets      $1,616,213   $(428,068)  $1,088,645 

 

For the year ended December 31, 2024 amortization of intangible assets amounted to $271,235.

 

Amortization of intangible assets with finite lives attributable to future periods is as follows:

 

Year ending December 31:  Amount 
2025 (three months ended December 31, 2025)  $65,656 
2026   225,971 
2027   225,971 
2028   225,971 
2029   160,126 
Total  $903,695 

 

Goodwill

 

On September 30, 2025 and December 31, 2024, goodwill consisted of the following:

 

   September 30, 2025   December 31, 2024 
Safe-Pro USA  $-   $518,255 
Airborne Response   -    166,612 
Total goodwill  $-   $684,867 

 

For the three and nine months ended September 30, 2025, impairment of goodwill amounted to $684,867.