Thanks and yw OM

Hi OM and all.

As we knew, revenues jumped up. The limiting factor this quarter was that the gross margin dipped back a bit.

I have mentioned here before how the company has advised in past filings that new business involves lower margins initially, until they can renegotiate more favorable rates. That could explain the lower margin this quarter as the company had one of the largest sudden revenue increases of recent data at about 33%.

If you look at their breakout you can see that it was Etelix that grew so fast in Q2. Somehow they managed to more than double Etelix revenue, as $10.7 million is about 2.5 times Etelix Q1 revenue of $4.3 million. It would be very interesting to know how this happened. Did they add service for a new large carrier? Did they open up in a new geographic region? Simply organic growth as the company becomes more established and well-known?

The other companies held fairly steady except IOT Labs which I think is mostly the Austin SMS business. It had another solid increase of about 13% and that's on top of about the same increase from the Q4 22 to Q1 23 timeframe.

What is interesting this quarter is that SMS Austin has long been the largest revenue generator for the company in recent years representing 62% of all Q1 revenue. But with Q2 Etelix has jumped from 18% of iQSTEL revenue up to 33% while SMS Austin has dropped from 62% to 52%.

That is important for at least two reasons. The first is that iQSTEL should be stronger with less dependence on any one of its holding companies. The other reason is that iQSTEL's history of tepid gross margins has been largely due to SMS Austin having very low margins, and yet were representing the majority of company revenue. The growth in Etelix came with a gross margin of 6.29%, and that's higher than the Q1 margin of 4.93%.

In other words, the most of the growth seen in Q2 helped towards increasing the total iQSTEL margin even as the total gross margin was lower in Q2. This would have been very obvious if SMS Austin had not seen a pullback in margin for Q2, and recall that it still represents a little over half of all company revenue. Growth that adds to the gross margin is just what is needed, and Etelix did just that.

For me, the takeaway is that Q2 is evidence that iQSTEL can grow out of its operation at just below breakeven, if they can continue to add higher margin new business, and/or they can improve SMS Austin's margin. Imagine Q2 with the Q1 margin of 4.93%. That would have added more than $800 thousand available to the bottom line, and easily created a profit. The increased revenue alone could have added more than $200 thousand at the higher margin.

In any case, you can see how adding higher margin revenue can help the company towards profitability. iQSTEL needs to continue that process, especially if SMS Austin margins continue to be so tight. One more surge in Etelix or any other higher margin area could make a huge difference with the company sitting so close to busting out over the breakeven mark. Hard to say if it happens, and then when it happens, but Etelix revenue alone has more than tripled since Q1 21, so the trend shows in that favor. Etelix margins have fluctuated but generally have tended to outpace SMS Austin by a good measure on average. Of course the company comment was that they plan to achieve profitability by the end of this year.

Although modest, I think we should recognize an improvement in Gen, and admin, expense this quarter. I think that shows determination to reach profitability in any way that can help, and that helps too.

IMO, the lack of superfluous communications recently is appropriate and refreshing. This small telecom company is growing and very near profitability. There is no need for much mention of EV, or other new ventures, until or unless there is some substantial development such as announcement of a new and active revenue stream. And then if it happens, I would think the new possibilities will seem so much more real, relevant, and potentially exciting.

In the meantime, IMO, I see a company getting all their ducks in a row, like so many companies before them, that they need to position for the chance of sustaining profitability. Maybe it takes a little longer than expected. Hopefully it happens. But at an operating loss of around $250 thousand that is really so very close, and does not require having to make any bad deals to keep operating. That can be just a small loan at this point.

Margins and expenses may fluctuate. There may never be a quarter up till now or in the next few that long investors don't hope to see profitability come through. I think at this stage of the company any few different factors could make profitability appear or keep it at bay for a few quarters. It seems just as likely to me that any number of recurring or one time expenses could hold iQSTEL at around breakeven or any number of improvements such as even a modest margin improvement could set iQSTEL over breakeven. The company isn't over breakeven not to mention enough over breakeven to absorb some unforeseen and limiting expenses, But arguably they are strong enough at this stage to not go far below breakeven as well, at least not without a lot of bad luck perhaps.

Looking at any company is it losing millions, near breakeven, or making millions? We know where iQSTEL was a few years ago, and about where it is now. You just have to consider what you see as the trend and whether you think the trend is your friend I think, if you are considering a longer term. I'm sure hindsight will be 20/20 some day, for wherever that you may think that leads.

Just my thoughts, not investment advice.

When I click on the Apple ads I get redirected to a Walmart link to purchase the Apple product on the ad. Links for an Apple Watch and iPhone at Walmart.

IDK, but seems like a start of some sort.

yw BW. Nice day.

The best answer is from the 8-K in March.

Initially the parties have identified that these METAVERSE products could be commercially sell in the following markets:

a) Large Telecom Carriers, offering a full METAVERSE product for its own products, services and media content.
b) Large Telecom Carriers white label, offering several METAVERSE suites for the carriers' customers, bringing to the carriers the ability to sell these METAVERSE suites in its own portfolio of products.
c) Corporate Customers, offering several METAVERSE suites that meet any specific need for each customer.
d) End User, the parties will create web/METAVERSE portal to allow to retail sale the METAVERSE suites, in order to promote the rapid expansion of the METAVERSE world.

The one I am most interested in is the white label offering, that can allow companies of any sort to use the product for their own metaverse plans. That could include meetings, trainings, tutorials, etc, and even, maybe most exciting, could be a metaverse marketplace for companies to sell their products powered by iQSTEL, but appears to customers to just be an extension of that company. The potential seems quite large if this plays out as such.

Of course you never know on the End User aspect. Its like any other new app it either catches on or not, but the ones that do can do very well. Just when you think there is no room left for a new social media platform, along comes another new player sometimes. And it only takes one big success to put a company like iQSTEL on the map if they get discovered as such.

But we know this was presented at ITW so its always possible some white label deals could be in the works.

The bottom line for me though, is this is much like IoT, and EV, etc. Just know its there and don't count on it to add anything new anytime soon. I look at the company value as mostly related to its revenue generating business and there is plenty there, I think, to find value.

Then if Metaverse, IoT, EV, etc, comes out with a big announcement, sooner or later, I would start to consider adding more value for that. As for Metaverse alone, I would think a white label agreement with at least one big company, or maybe several agreements with others, could do a lot to enhance shareholders perceptions.

yw BW. Let's see what the next quarters bring.

Yw and thanks too. You never know until you know I guess but it would be nice if something changed that was obviously able to put them positively over the p/l line.

Let’s keep watching those margins.

Hi BW and all.

I don't see tons of new information here but I like that the gross profit and gross margins exceeded their preliminary announcement considerably. Gross margin at 4.93% is substantially above last years average of 1.92%. It looks like some quarterly rebalancing took shape as I suspected it might.

But 4.93% gross margin is not enough to be profitable. Still its a move in the right direction. It also helps that General and Admin expenses were held to slightly lower than last quarter.

Some units are weaker on revenue. I wonder if they might move sales among units or perhaps even drop unprofitable sales areas in favor of higher margin areas. I haven't seen that stated though. Also, we do know that they advise that the first part of the year is their weakest revenue period.

Even so, sales are strong at about $24.6 million and they appear to be on track to meet their yearly forecast with improved future quarters. I'm glad the Etelix margin bounced back impressively this quarter. Also the unit that they call IoT labs continued to grow revenue this quarter, but maybe more importantly, IoT labs margin improved to its best showing since Q3 of 2021. It needs to improve a lot more, but improvement there takes on special importance as IoT labs represented about 62% of all company revenue in Q1.

Cash held up as someone mentioned in another post, and they added a bit to it. Any quarter we can achieve that, prior to profitability, allows more flexibility for the company in their need or lack thereof of future funding pursuits. (Possibly less of a need for further dilution for operating expenses).

By now we are well into Q2. I hope they can build on the positive trends they have and work out the bottlenecks toward sustained profitability. As always, it would be great if they came out with some concrete news developments on any new division that could bring higher margins. IMO, not exciting new ideas so much as some as the ones they have been working on and hopefully as coming to fruition.

Like I say there is not a lot new this time, but I think its good to see margins back at levels that put us in target for profitability, if they can improve on this.

Thanks. It’s a pretty good group here really.

Thanks OM - I really wonder if we have seen the bottom now. We may not know for a bit but I think it is noteworthy getting to a lower level on price to sales than the significant low reached ahead of the run in early 2021.

And the balance sheet looks so much better now, the debt load was large and confusing then. And generally we should be much closer to some new revenue streams than we were then, if/when the company comes through on those.

The telecom business is much stronger too. They had an uncharacteristic blip in margins last quarter, but one that has already improved. And some other good things are happening - such as that the newly acquired Smartbiz revenue grew revenue 64% from Q3 to Q4.

Obviously not all numbers are positive but its amazing that the two new acquisitions represented 25% of total company revenue in Q4. Further, Smartbiz and Whisl contributed about $1.6 million in gross profit. That goes a long way to help towards covering their acquisition cost, and note that full revenues for those two additions were not even occurring until Q3. The combined gross margin of 12.7% also gives a substantial boost to the overall company margins.

On this early evidence, it's clear that these two acquisitions were prudent additions, and arguably showing some finesse on management ability. They have what they have, but its what they do with it moving forward that matters the most, and this looks like a very good call to me.

I guess it all has to play out over time, but noting that at this point I see price to sales near historic lows, and at less than 1/5 of the industry average.

Crawfors,

Your thoughts here fits pretty well with some thoughts I emailed to the company, and I'll add on that here. My thoughts generally implied that IMO, iQSTEL needs to set a bottom price (likely not publicly shared) for which they would sell shares.

Maybe it's $.50, $1.00, or $2.00 or more, but mainly just don't take any less than that for shares pretty much for any reason whatsoever. In that sense they would establish a point at which they value the worth of their company.

If they can't get that price and want to do an acquisition, then don't do the acquisition. Or if their numbers are good enough maybe use conventual financing, again, only if it would pay off to do so. But not financing that involves warrants or options are any other device that pays off a lender in shares. Just a simple loan, and repayment of interest. If they can't get favorable terms then don't do that either.

Of course they do have to do what they must to keep operating until they are profitable, but they need to keep any sources of funding at as least toxic as possible. We are in Q2, so maybe they are already profitable or getting close to it, based on their 2023 guidance.

If the company sets a minimum level for selling shares, I think the market would likely take a hint at that towards deciding a fair value of the company. That is to say, if iQSTEL sets a price that they consider a fair value based on their inside knowledge. It may not be publicized, but eventually investors can see at what prices the company is able to sell its shares and might consider that as something of guide in determining the market worth of its shares.

In any case, I can't see how it does investors or the company much good to sell shares well below what the company believes that it is worth. Ultimately they control for how much they sell those shares.

Just some numbers for entertainment, but in December 2020 the share price hit a (then) recent low of $.071. When you look at the shares out and revenue at that time the price to sales ratio bottomed at about .19 of sales. At yesterdays low, and based on current shares and sales, the price to sales ratio hit about .18 of sales.

In the 2020 - early 2021 time frame price to sales went from about .19 to 5.27. A 1.0 price to sales would have been $.38 a share. With current data a 1.0 price to sales should see about $.56 a share.

Bottom in? I don't know. I bought a few more at $.11 this morning, but I have bought at levels all up and down the scale like many of you. That's just my plan, not investment advice as everyone needs to figure out how they see it and what they should do based on their own DD.

Sure BW, I'll share the way I see it. Again its not investment advice.

As of the 10-K, I see a company experiencing growing pains. I haven't seen many arguments about the company's revenue growth. Beating their projections, they posted a 44% revenue increase over 2021. Over the past several years they have delivered consistent high growth rates that most any company could be proud of.

As we saw through the year, gross margins increased at times, but when the final numbers came in the gross margin for the full year remains fairly thin. Like last year, the full year gross margin remains in the range of about 2%. Excluding the funding for acquisitions, iQSTEL needed a gross margin more in the 6%-7% as a base.

When you dig around a bit you can see that iQSTEL has a telecom unit in "SwissLink" that hasn't grown much recently, but it has delivered a gross margin over 15% at least over the last two years. Obviously if all the telecom operations had margins like that then iQSTEL could be profitable, and very much so.

I also notice that Etelix has reported positive quarterly margins, and sometimes over 5% or more, but not for the full year this year. In fact, the Etelix margin is negative for the full year. When you consider that Etleix currently represents about a quarter of all iQSTEL revenue then a negative margin has a dramatic effect.

Why? Growing pains, I think. Some of you may recall that iQSTEL stated in a previous filing that when adding new business, the margins are lower until the customer base is acclimated and rates can be negotiated for more favorable terms. But how does that fit into Etelix, which is the core telecom company that has been there from the start?

Well Etelix is not just old business, It's growing and growing fast. Perhaps this is one of the most overlooked, but potentially exciting aspects of iQSTEL's telecom growth is that they are able to grow their core operation as such. Etelix grew 44% last year, matching the overall company growth rate. The only other telecom operation with a (better) but low margin was IoT Labs (aka SMS Austin) and that's the only other fast growing operation, as it grew at 21% last year. I'm thinking the correlation between new fast growing business and lower margins is not coincidence. Note, that I'm not considering the new acquisitions (Smartbiz and Whisl) at this point as their is limited quarterly data compared to the others.

But, this really puts the weight on the the overall gross margin when you realize that Etelix and IoT Labs currently bring in 81% of all company revenue.

Even if you agree with all this it may still feel frustrating that margins could be seeing a strain from the growth. It might feel better for a minute if iQSTEL stopped growing and just maximized the business they have. The trade-off to presume is that you can only stand to gain so much, whereas continued growth might allow higher and higher levels of potential success as more and more "new business" transitions to old business with the assumed negotiated higher margins.

Does that condition last forever if they keep growing? It doesn't have to, as you may see the new business each year as still substantial or even large, but as the company may continue to grow that new business would likely become less and less a percentage of the total business. In this case, growth and profitability could go hand in hand.

For better or worse, I think this is where iQSTEL's stands at the moment. It's a big part of their business model as they described, and its a work in progress. One that is delivering big revenue gains. Do bigger margin gains follow? I think the company thinks so, and I'm here, but that's just me.

I'm not all about this one report or the next, as much as the long term trends and where I think this can go. Perhaps the one clue we have is the company's stated projections for operating income this year. Does that hint towards at least their hopes to improve margins this year? Will growth and profitability finally go hand in hand?

A few other quick notes is that their cash position over the year has lessened by about a couple million or roughly just about the amount for the acquisitions, so holding well there. I take that as they did not take on much or any equity selling than they felt they needed to.

As someone posted, the 10-K mentions a reference to the global chip shortage as one reason that could have delayed the IoT products. My first thought is why did they not just tell us already? I have already wondered if the long standing Covid lockdowns in China could have affected the EV products. They can tell us these things and it will be ok, I think.

Also, I wish they would, will, or do consider multiple sources for EV vehicles and products, and other offerings such as IoT devices. Maybe the Chinese EV design has to stay with the current manufacturer. I don't know. but if so, maybe have another EV design built in another country. Or multiple countries. Maybe even in USA? Anyway, just wouldn't want to see us at the mercy of one source.

An interesting note in 10-K about IoT. "an important milestone" - company received patent for IoT device. Recently? Was that one of the hold-ups?

Fintech - I don't see any new timelines coming mentioned in 10-K.

Blockchain - Commercial release in June 2023? Again, that would have been good to put in one of the PR's. Maybe send one out now explaining the plan and potential?

Metaverse - maybe it's cool, but hope we don't spend (much) money on new areas, as profitability is needed to help increase overall credibility.

EV - I hope the new website includes a dealer locator among other things, that validates the program and provides more accessibility. When do you see final certifications achieved and all testing completed? When do you see first sales (date)?

Well that's my thoughts, actual DD is personal experience.

Hi BW, and all.

I'll share a few thoughts, but that's just me, not investment advice.

For any short to mid-term time frame, for my investment, I consider iQSTEL based on its reported revenue generating business in telecom alone. If EV, Fintech, IoT, etc., revenue streams are reported later, or even soon that's great, but for the most part its not a factor for me.

Per the sources listed below a typical price to sales ratio for telecom is 1.01 to 1.62. On that basis iQSTEL could be trading at $.62 to $.89. That is based on current share count and last years projected sales of $90 million, which we were already told was surpassed. Even if Apollo were to execute the full option amounts the share price could still be around $.55 to $.81. And if that happens iQSTEL receives a substantial further cash infusion.

https://csimarket.com/Industry/industry_valuation_ttm.php?ps&ind=905

https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/psdata.html

It's fair, I think, to question the company's worthiness for an industry average ratio. Last years margins were razor thin early on, but margins increased each of the last 4 reported quarters. If they can maintain the third quarter margin of 5.99% that would greatly boost its "worthiness" for an average ratio in my mind. If they continue to improve I will be more impressed. Of course a setback can occur, but if the long term trend remains up then that carries a lot of weight for me. Keep in mind that as revenues increase each little % of margin gains can add greatly to the bottom line.

In short, the company may still need to prove this to the market, but the current trend of reported data is pointing in the right direction. From there you could talk about the extra value of the company from new business divisions. I hope they can demonstrate that, but its been pretty elusive to this point. I have my own current value in my mind, and its something that has not changed much lately, but it can change greatly as the company evolves.

They seemed to have stopped teasing new developments so much. Maybe that's what some investors asked them to do? An investor can make their own choices on whether to assign any perceived value for new divisions or not. Likely they don't even know if any, all, or none will pan out. Maybe some won't, and that's ok, especially if at least some do.

Perhaps like others, I hope they do have a big hit in IoT, EV, or Fintech soon, but maybe they will or won't. I'm not too concerned about those things taking longer than they seemed to think. For example, they first thought some of last years acquisitions would close a quarter or so earlier than it did. But Whisl and Smartbiz did happen in time. Maybe some good news will come later. (sooner would be nice too).

It sure seems like the BASF deal has been on the burner for a long while, but you know, its the largest chemical company in the world. They are the customer, and as far as we know its still in testing. They hold the cards. Hopefully we get a deal, but if it happens it will be on BASF's timeframe, not ours. And maybe even some other company or companies sign up before or instead of BASF, you never know.

I have to include a few thoughts about this Metaverse news. I think its important to look at the big picture here, and that is that iQSTEL is a holding company, and that it's roots all branch of the core telecom business. As a holding company, they look to add businesses that fit into their plan for success, and those that compliment what they already do. Obviously they see this new opportunity as a large potential contributor. It's not being absorbed into another division, it is planned to be another company in its growing portfolio of companies.

iQSTEL could just be any other telecom company. They could sell SMS and voice services, and simply try to grow from acquiring other smaller carriers. It might be a good plan, but would you be so interested as an investment? Maybe you would, but I like iQSTEL because they are trying their best to become a part of a wide range of possible and proven new advances in telecom services, and looking for the synergies. It's easy for some to call them out for trying to aim too high, but where do the biggest successes start from?

Sure some of the biggest companies like Facebook and Disney are pulling back their Metaverse ideas, but maybe that's actually a positive for smaller players. These smaller telecoms are there because they provide services to the large and medium carriers. Services that those larger carriers don't wish to keep in house.

Maybe iQSTEL is on the right track in thinking Metaverse does become an additional telecom service such as like voice and SMS are services, and are provided by companies like iQSTEL. Also, the one point that may be most overlooked by investors is that iQSTEL sees a huge opportunity in offering their Metaverse product as a "white label" product, thus allowing carriers and other companies to essentially provide a Metaverse product as labeled in their name as their own respective service, and that will appear to their customers as their own, although it actually begins through iQSTEL.

If the GOTMY product is good, maybe they just needed someone in the biz to provide it along with other services, and apparently iQSTEL believes that this is what iQSTEL brings to the table. Is that the right approach for Metaverse going forward? Who knows, but maybe it would be pretty nice for iQSTEL investors if the company has a good vision here. If not, well maybe its a good try, or maybe they can pivot.

On the issue of alleged naked shorting, I don't fault the company for looking into its options. I would say that if their margins are holding or getting better then it will seem harder and harder to understand why industry average ratios would not be achieved, if that's the case, and that should mean corresponding higher share prices with the expected variables. I also like the implied public notice that the company firmly believes that its stock has more value than the market is currently providing.

My biggest concern with actually hiring professionals to combat any such activity, if found, is whether the associated cost could derail our chances at reporting profits. I'm sure the company is acutely aware of the issue and will carefully weigh the pros and cons of each potential course of action.

I'm still long. I like the trends and I still see a company growing and improving in many metrics. You can bet I will study the upcoming 10-K, and the next 10-Q very well to see how they are doing. Again, I don't always expect improvement on each and every number exactly, but the longer trends are all important. It's a marathon, not a race.

Today's share price is what the market supports today. While some key trends have improved the share price has drifted lower. Maybe the market doesn't believe the company can hold its recent margin gains. Maybe a feared down tick on margins is already priced in, and if so, some may say that the severity is more than is warranted. Maybe the market is right to have concerns, maybe its wrong. We will get numbers soon, and more numbers in May. Each report tells one more piece of the story. Thus far, what trend do you see over time?

What we do know is iQSTEL is valued in the market at only a little over a quarter of the average of its peers. I would call that near the bottom of the lot. Maybe not a great place to be overall, but maybe a good place to be in for consideration of downside potential vs upside potential, especially considering the current positive margin trend, I think. Everyone just needs to play it as they see it, and choose directions they are most comfortable with, as they see it in their own ways.

The charts below don't provide any predictions, but the first chart shows the double bottom that occurred before the run up to $2.00 about a couple of years ago. The bottom chart shows where we are now, and could possibly show another double bottom in progress, if that ends up being what happens.

Hi BW and all.

I just see the company continuing to head in a positive direction and I see Q3 results confirming progress in many ways. Importantly margin performance has increased for every quarter since Q4 21, and that is fueling the trend to profitability.

But also the Smartbiz and Whisl acquisitions are helping margins as well, and that is proving their M&A strategy. The bottom line for me is the telecom business is growing and making the company stronger all on its own.

They have gone quiet on the (thus far) non-revenue generating ventures, which is fine with me, but I'm ready to hear of some leap forward in any or all of those, if that be the case. No expected time frame from me but we need to see something to further validate their goals.

Q3 did meet or exceed the guidance and that matters a lot I think, and I believe the market was looking for that. There is still much room for improvement in telecom both in revenue and margin growth. And it may be pretty exciting if the other ventures begin to add to the bottom line. In fact, Q3 may become to be the mark of the so called "inflection point".

JMO, but I think there is much room for the share price to rise quickly to a fair value, then with further developments who knows where it may go. For now, I just appreciate the company delivering on some guidance, and I hope they can continue to do so.

Maybe Winston Churchill's quote fits well for iQSTEL today. "Now this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning."

Good points and mentioning the cashless option. Either way I think that the exercise price will be set Sept 30. Apollo doesn’t have to purchase at that time, but I think that after that day they will be hoping for much higher prices, as longs do too.

Also, yw and thx BW and OM69

It's an amendment to the S-1 filed on September 2, 2022. It's basically the same information in most regards. I may have missed something but it appears that the details regarding the potential company offering are mostly the same. And recall that the company offering can be used wholly, or in part, or not at all, as they see fit. It looks like they want to issue any such shares at $1.00 and the majority of the proceeds are expected to go to fund acquisitions, potential dilution for growth, and the plan should be to create plenty of extra shareholder value to more than outweigh any dilution.

Also, be sure to note the statements in red that explain that the prospectus is not complete and may be changed. (further amended). For example, if the share price trades at $2.00 or more later they would likely amend the target price to issue those shares at $2.00, or some other appropriate price.

The primary difference that I can see in the amended S-1 is that the amendment contains more details regarding the option that was purchased by Apollo. I'm no options expert and the details are complex for me, but if I understand correctly then Apollo may - and under the correct conditions and timeframes - be able to acquire shares under the $2.00 exercise price.

"the exercise price of $2.00, as may adjusted by certain provisions in the option, such as stock splits, price adjustments for future options with lower exercise prices, price adjustments in the event our stock trades below $2.00 on the initial exercise date with such new exercise price to be at a discount of 16% and up to 32% of the market price of our stock (if the stock falls below $1.50) on the date of exercise"

It may sound odd at first, but it's not necessarily as big a windfall for Apollo as it may seem. If we assume a share price of $.30 on September 30, and if Apollo could and did exercise then, and if they were able to get the maximum discount they could perhaps acquire 4.8 m shares at $.204. In theory, if they then sold those shares at $.30 they would make $460,800. That's less than what they paid for the option, so not so good a deal for them in that case.

So it looks like they potentially benefit with a low market price as of September 30. Perhaps the lower the better. But the flip side is that after September 30 they would benefit more with the highest share price they could get for selling. The higher the better for them.

If I got that right then take it as you wish, and keep in mind that I could be in error on some or all points.

But here is what I see is the takeaway points for shareholders. First, the company has not been profitable and the shortfall in cash has to come from somewhere. This option was a way to take care of some of that. The guidance is that Q4 may be profitable. We should hope that is the case, and also hope that this option, ($500,000) will carry their funding needs until they may become profitable.

No one wants to see dilution, but it would be much preferred in my opinion to come from the potential company share issuance, and at a higher price, such as the target $1.00 or more. Or better yet, that we can see operating expenses covered by profits in the future.

The option served its purpose, but I hope they don't have to do that again. It seems counter productive to have any party with a possible interest in seeing a lower share price. We (long) shareholders wish to see higher prices, but the company should also wish to see higher share prices so they can issue shares at higher prices rather than make deals that seem protective of those who provide the funds. It's just the kind of thing that has to be done sometimes to keep things going.

The bottom line is cash from operations, from profitability, can eliminate the need for these type of deals. We should hope iQSTEL can avoid these situations in the future as we, or they, should not want any parties hoping for lower prices at any time. But they had deficits and this is how they dealt with it, its done, or it should be done as they potentially deliver on profits. Also, It may help a bit to note that even with an exercise price at $.204, if that's what it turned out to be, that would bring in nearly another $1 million in cash for iQSTEL. (and thus indirectly to us shareholders).

The final takeaway is that further discussions on this issue is just looking at the past. The dilution potential is unpopular but relatively small and the company apparently felt it was necessary to continue operations. Unfortunately every time they file one of these S-1's it starts another round of discussion. Especially when market prices are weak.

But also consider that, while Apollo perhaps hopes for lower prices up to Sept 30, by October 1 they may be more interested in seeing higher prices, at least to our knowledge, if these thoughts are on target.

Of course most of the market is down and it may not help us that there may appear to be lots of possible good buys all over the place. I can't say what comes next for iQSTEL but I'm hopeful some solid good news appears such as a signed contract with BASF and related projections, or similar such regarding other IoT, Fintech, EV, Telecom, or etc.

Everyone has their own levels for risk tolerances, and their own opinion on risk vs reward. Should do their own DD and depend on that for investment decisions. My opinions, are just that and not investment advice. I feel good about iQSTEL long term, but I would reconsider if they miss performance targets. Thankfully they gave some pretty specific metrics in expectations for the next couple of quarters. Perhaps some amount of leeway could have merit, but its time to deliver, and I am looking for that. No precise dates, just looking for concrete progress, and I think that the guidance is promising, even if not as specific as we may desire yet.

Look at the first objective "iQSTEL becomes a billion dollar company". That means they hope to attain a billion dollar valuation, or about $6.60 share price on today's share count.

Of course that is an objective, time frame not specified. On the other hand, billion dollar companies can be the precursor to $2 billion companies, and so on.

Thanks byloselhy

yw BW

yw 069

Sounds reasonable.

To my knowledge all they have recently needed to apply is the minimum share price. The S-1, or issuance of shares, may or may not have an affect on that, but acquisitions it might fund could help bring the levels needed to up list, if investors like what they see.

Regardless, I think what they already have the works can do that too, if they start demonstrating positive results in one or more product areas that are planned.

Their setting a target price of $1.00 to issue shares doesn't limit the price from being higher, but I think if the price went higher such as Nasdaq levels, they would likely amend and raise the target issue price, perhaps keeping some measure of value in place to entice a large buyer, or buyers.

yw Big RDC

Well to start, people keep asking why would anyone buy shares at $1.00 when the company trades lower? That's not the question.

If you, or anyone buys shares on the market they pay the going price, more or less, and that's not what this S-1 is talking about. Whenever you buy shares on the market it's basically one person or entity selling their shares to you. And those shares were issued long ago. So for each trade, the company doesn't make anything on your trade, they only made their money when the shares were first issued.

Some were issued years ago, some were issued last year, or this year, so that when you trade now its all from that pool of around $151 million shares.

So what the S-1 is doing is providing the information about the company's potential desire to issue more shares. Adding shares is how they make money from the capital markets. Obviously they want to be careful with that because if you sell too many shares too quickly people could not want to keep buying. Thus we shareholders have to figure out if we are getting a good deal for the dilution, and the company should try to keep us happy in that regard.

That brings us to the S-1. It mentions the option we were already aware of, but also informs that the company would like to issue up to 10 million additional shares to raise capital. From the filing, they don't have to sell any shares, and don't plan to sell any shares unless they can get $1.00. They can issue as little, or none, or as much as they want up to 10 million shares, as they see fit. (and all numbers can be amended).

The main takeaway for investors, IMO, is that the more they may issue, the higher percentage of the funds raised are planned to go to acquisitions, up to 85% for the full 10 million, if used. The $1.00 pricing should indicate that the company expects to see the market price at or over $1.00 over the next several months, at which time they could elect to issue some or all those shares. Maybe we get some dilution, but that's not bad if it adds positive net income that more than compensates, and the last two acquisitions were immediately accretive.

Bottom line is they need a way to fuel growth and that's the main reason for them to be in the equity market. The better they perform, should lead to higher issue prices they can ask for in the future. But, like larger companies, if they become net income positive they may eventually have less need to use the equity market to fuel growth, and that would be the time a company might consider things such as dividends or stock buybacks, if any is left over from the future growth plans.

Last note, is IMO, if they get $1.00 for issued shares then that is a reasonable fair value at or around this stage of the company, given what we know. They are so close to profitability that even small issuances can keep working capital in check. That should imply little to no need for any unfavorable financing notes or terms, which implies strength. And if the stock price trades above that later they can always raise the issue price in an amended S-1, until maybe they growth large enough to fund growth in other ways.

So when do we see $1.00? IDK, but I believe the company is worth at least that much based on commonly accepted valuation methods. It's easy to say we are a ways from it, but we know how quickly prices can move. I like to think we are one solid announcement away from iQSTEL catching up to a fairer market value.

IoT contract? Compelling EV orders and data? Fiber acquisition with exciting net income projections?

Hard to say but guidance is to expect revenue from several new streams to begin this year, so the picture should begin to get much clearer over the next several months. That guidance in itself is something substantial as opposed to "coming soon". This is a specified time-line that we can measure as a potential performance point (or lack there-of), but I think they intend to deliver on that.

Thanks O69. We’re all in it together. Should get much more interesting if we go from red to black, and hoping for green for all 2023.

Wooferwax, that question can only fully be answered by the company and I am with you there as the "IoT" division is currently the single largest revenue generator for iQSTEL. Thus even small margin gains there could add up to big contributions to the bottom line.

But here are some things to consider as I see it. To begin, you have to note that the "IoT" division as we think of it (Smart Tank, Smart Gas) is not necessarily what the 10-Q is referring to. Actually there may not be any revenue in Q2 from IoT devices, or if there was it has been minimal to the date of the last filling. I think if there was substantial IoT device revenue we would have been told.

Rather, the "IoT" revenue as stated in the 10-Q is either all or mostly all revenue from the telecom (like SMS) business that the company acquired and operates from Austin , Texas. I'm not sure why the 10-Q shows it as "IoT", but I can only assume the two fall under the same ownership for that division or are legally tied together for accounting purposes. Just my guess, but we know that Q2 revenue is all or mostly all telecom revenue.

The QGlobal telecom business based in Miami is minimal to the whole so I won't say a lot about that. Smartbiz and Whisl are new, but each reported decent margins at near 10%, and over 21% respectively. Swisslink has reported margins over 10% for at least the last 6 quarters, if not more.

That leaves Etelix and "IoT", and I'll refer to IoT as "Austin" for the remainder of this post.

Several times, I have referred back to a statement from iQSTEL that generally said that newer SMS business involved lower margins, at least until the company can get in a position where it can negotiate better prices. And you have to keep in mind that competition is fierce amongst the various small telecom companies.

Austin is the newest of their business, but Etelix is among the oldest. The two together represented 87% of total revenue for iQSTEL in the 2nd quarter, but had the lowest margins. Etelix margin was 3.66% and Austin was only .62%.

You might think Austin has been around long enough to start showing more improvement, and certainly Etelix has been around for some time. Personally, I would love to start seeing better improvements for each or at least hear from the company that improvements for each of those will improve soon. Typically, they just advise that overall telecom margins are expected to improve.

Since Etelix and Austin are such big revenue contributors, then even small gains in margins can make a huge difference. If they are able to reach around 10% margins or better that could really do a lot of good to the bottom line. Only iQSTEL can answer where they see this going.

But I suggest to consider that Etelix and Austin are the recent big growers of revenue. Swisslink is relatively flat in growth and Miami is minimal in size anyway. Etelix has nearly doubled over the last 6 quarters, and you could almost say the same for Austin. In fact Austin, grew by about $2 million in the last quarter and that increase alone is more than total Swisslink and Miami sales. Also, the Austin increase equals to about a third of total Etelix sales.

So 87% of revenue is growing and that brings me back to the idea of "new" business, and tighter margins. Etelix and Austin are both not "new" but they are adding a lot of "new" business, and maybe that helps explain why margins are more lean there. as they may not be in a position to negotiate better prices yet.

Still, when you look at the whole, Etelix and Austin should still have a lot of business that the company has carried for a while, and we should hope iQSTEL can start improving the margins better there. It's a good question for the company, because it does make a difference on future profits. Are these margins about all we can expect or can Etelix and Austin perform as well as Swisslink?

But recently the company made this statement, so maybe we already have the answer.

Management reports that the company's Telecom Business Division is performing amazingly growing revenue and increasing gross profit as a percentage of revenue.

Although modest, margins have grown over the last three quarters, and if they continue the positive trend then they can build on it. For example, Q2 at 3.01% margins exceeded the full year margin result of 2021 of 2.37%.

But the company says telecom margins will further improve. Meanwhile, any tech products or Fintech additions should involve better margins and that should also serve to bring up the total margin. The bottom line is that the company expects profitability by Q4 and adds "and beyond". That may be the best clue we have on margin direction at this time.

One last note. I pointed out that Etelix and Austin are the largest growing segments. But we don't yet know if Smartbiz and Whisl are going to be large growers too. They represented about 8% of total revenue for Q2 which they only had sales for 1 month of the quarter. If they grow and maintain higher gross margins then that should help the overall quite a bit.

Likewise, other telecom acquisition activity may occur, and can become a large factor in overall margins. iQSTEL was selective with the last two acquisitions and looked for those opportunities that will be immediately accretive.

Maybe a little more than you asked for, but just putting it out there as I see it.

General industry reference -

https://www.msn.com/en-us/money/companies/fiber-optic-technology-powers-the-internet-and-it-s-a-big-business/ar-AA10Lfz2?rc=1&ocid=winp1taskbar&cvid=85c319aad0e34f60a04de204bea90960

Thanks JMC$. Probably the best words in the highlight are "and beyond". Q2 is past, this wording points to the future.

"The company anticipates being close to break even in Q3 and reaching net income positive in Q4 and beyond."

yw and thanks Captbass. That was a nice little bump up yesterday, maybe we can build on that this coming week.

Thanks O69 - sounds like your grabbing shares by the fistful. GL!

YW BW and thanks! We should have some interesting months coming ahead. I know we both, and others, have waited patiently.

Thanks Joe! I look forward to your posts as well.

Afterthought - should we be asking what short sellers have to do when a spin-off occurs?

Hi Broadway - sorry I was literally off the grid all day but I noticed that after your question the CEO put out an excellent rundown of the call, chock full of details. Actually it seems to me that the written version clarifies several points that I didn't fully understand during the call.

Perhaps the best example for me was some structure of how the spin off should go. iQSTEL as the largest shareholder. some new investment through IPO, and a distribution to iQSTEL shareholders. I take that to mean two benefits to current shareholders in the form of direct interest in the new company stock while still benefiting thorough iQSTEL for the remaining, majority interest in the new stock.

Of course the next question is just how much each party owns of the new company. iQSTEL, us, and any new shareholders from IPO. I hope we see that information soon, as the CEO states this is all moving faster than expected. Maybe we will finally see a Nasdaq listing for at least EVOSS, but IQST may still be in the running for that too?

I won't cover the whole letter but here are a few points for me, if anyone is interested.

* I love and appreciate the clear guidance on profitability. It implies that Q2 won't be profitable - no surprise there. But the Q3 close to B/E and Q4 likely positive is very specific and gives investors a solid bar to measure performance. Now they really need to try to meet or beat the expectation, but I much appreciate the clarity there. I have often said even news less positive than expected is better than no news, as it decreases the uncertainty. Especially, if its just that timeframes are a bit behind schedule. (Think Elon Musk).

* Telecom results sounds promising. Let's see the margins Monday, but the guidance is encouraging.

* Target pricing for motorcycles and EV cars is provided and helps clear up a few more questions. I would love to see some general revenue projections. If this goes IPO I assume there may be a prospectus. Hopefully some very good detail would be included therein. For now I appreciate the stated timeframes for revenues from each type of EVOSS vehicle.

Also, I love to see them continue to make improvements to the product including battery performance. IMO, they really seem to care about the product and won't rest on "good enough". Lastly on EVOSS, I think its great for shareholders that they plan to finance the division through lending, as to limit dilutive impacts for shareholders.

* Fintech, well not a lot of info there other than the partnerships and the potential target market. I hope some more clarity comes soon. Revenue when? Expected growth rate and margins?

* IoT news is very good, but I would love to see an announcement of a signed contract with BASF. But the negotiations with the large Mexican gas distributor, and OMG, Saudi Arabia sounds exciting. Can you imagine how many tanks either group might have? And perhaps stationary and/or mobile I assume?

One other thing, referring to the option purchase by Apollo, as seen in the last 10-Q, subsequent events, whereby they are said to have agreed on an option to purchase 4.8 million shares at a purchase price of $2.00 per share in consideration for $500,000. The initial exercise date is said to be September 30, 2022. I didn't see an expiration date for the option, and that would be interesting to know. But still I take this as a positive as the agreement implies some confidence that the stock price may reach $2 by September 2022, or thereafter. And if not executed we keep the $500K, but if executed then the company gets a huge cash infusion, albeit with some dilution for us. But I would like to believe it would be use for some valuable M&A activity. Just guessing, but how would they pay for the 2,300 mile fiber acquisition? The timing sure seems close.

I sure hope these calls with the guys at Alpha Status continue, I think its a great outreach opportunity for the company. But I also hope they will start having regular company hosted quarterly calls, following the quarterly results. It's a common public company practice and gives investors an update that includes the latest information, and should also allow just enough time for investors to read the 10-Q before the conference call so they can ask questions based on the latest information.

Like I say I don't expect Q2 to show a large improvement over Q1, but the real potential game changing catalyst aren't expected to show in the numbers until at least Q3, and that starts as the first full quarter with the Smartbiz and Whisl acquisitions contributing to the whole quarter. The one thing I can say though is I still see a company that is growing and showing consideration to its shareholders, while creating additional shareholder value. They really need to start coming through on their tech products but the speed of progress has been pretty quick I would think, and surely in a realm of reasonable expectation for the industry I expect.

Heck if any one of those three IoT deals alone come through don't you think stock prices at these levels would be laughable? Of course you would think the existing telecom revenue streams alone should way more than have it covered,. So they say (Field of Dreams), "If you build it they will come". Maybe they don't come as quick as they should, but once its there, the rest should follow.

BTW: Anyone notice that iQSTEL is already taking online orders for motorcycles? Not sure if that is available worldwide? Maybe so, IDK, but the English translated version doesn't seem to indicate the total price, at least before the form is completed.

https://evoss.net/landing-page/

That's right.

Broadway,

It looks like another opportunity to me. If it did not happen to work, nothing much lost I think, but if its a big success then can you imagine?

I think the EV motorcycle looks pretty sharp and they are already upgrading its performance. I think it's a pretty safe bet that the EV car will be upgraded in distance and speed as well.

Does iQSTEL have something unique and superior in battery design? I'm not sure what the driving force is here, but they appear to be moving ahead balls to the wall.

This is the time to get in on the EV revolution, in just a few years newcomers may find the path hard to follow. Hopefully because iQSTEL (like others) got in early and captured swaths of the market share. And, I believe I would sure look hard at any opportunities in Europe as we may assume an EV revolution will be accelerated there due to the war related energy crunch.

Actually with higher gas prices most everywhere, EV's may be in big demand most anywhere. It sure looks like iQSTEL is getting well positioned for it, I hope they do catch a big win here, as well as with the other products and services they have and are working on.

This is something I like about iQSTEL, of how they are combining seemingly unrelated services and products.

"Drawing on our high-tech and telecommunications background, we plan to integrate the EVOSS EV car with a variety of high-tech features."

To me that's why you may want to keep it all under one stock, IQST. Even if the street hasn't figured it out yet, these guys look to be ahead of their time.

Don't just sell EV motorcycles and cars, but provide Fintech services to facilitate, and provide telecommunication services as a feature. If I understand their statement they may offer add on services - I picture monthly recurring revenue long after the sale, to their EV products.. See the article below as an idea.

One big difference may be that iQSTEL has something with its IoT technology that I'm guessing may be ideal for EV's too. The tank monitoring device has to communicate from various locations, just as an EV would. This technology may provide some features others don't have. We know that It is award winning.

https://www.fool.com/investing/2022/07/18/bmw-starts-nickel-and-diming-car-buyers-will-other/

yw!

Honestly I'm not a expert in that area, and I have questions about that myself. And really, I'd rather not speculate on the mechanics of it until we get more information. I sent some of my thoughts to the company directly. I'd like to see what their plan is, but I assume they will let us know the details when they are ready, unless they drop the issue instead. But from today's letter, it appears to still be on go.

For now, generally, I think it would be better to consider a spinoff only after IQST stock might make it to Nasdaq. But if/when that happens, I'm not sure a spinoff would be needed, that is, if they are just finding ways to get to Nasdaq. Bottom line to me is if EVOSS looks good enough to stand alone, then if we knew more details about the division that might get us to Nasdaq, or at least help a lot.

Of course a spinoff can be a good thing. If done, ideally, in time shareholders would own two stocks and each worth more than the original left alone.

I'm just not sure what they are seeing that we don't see in EVOSS and otherwise, but right now I'd rather see IQST stock make it to Nasdaq by any and every means possible. Taking parts away doesn't seem to be a way to help that goal. Of course a lot can change quickly if milestones are reached or if any major new news drops. Maybe if I had their knowledge a spinoff would look very timely.

In other notes, I liked today's letter. Lot's of good information and updates. Still could be more, but good to hear:

- Fiber deal still in consideration
- Another telecom acquisition being considered
- Finding ways to make EV motorcycle better (presume more ready for U.S. market)
- Expect EV orders in Q3, Revenue in Q4
- Expect IoT revenues in second half of year (that's new!)
- Start marketing IoT to the mass market (of this industry). This implies that they believe the product is ready for the market.
- Fintech and MNPA seem to still be works in progress, but said news coming
-Still expect positive Net Income for 2022

We should be about a month away from Q2 report. Q3 will include full months of Whisl and Smartbiz. I hope to see at least some modest margin improvement, and it appears that the pieces are coming into place to allow that. If that happens and combines with any other organic improvements it should really help transition the company.

Traded today close to half of expected FY 22 sales, in an industry with a typical 1.43 price to sales ratio. And that doesn't even include the non-telecom divisions.

https://csimarket.com/Industry/industry_valuation_ttm.php?ps&ind=905

I think the announcement may explain a lot, and I'm just guessing to some extent, but it may explain why we haven't heard much for a few months regarding Smart Tank.

BASF is massive in this field and currently number 134 on the Fortune 500 list.

https://fortune.com/company/basf/global500/

I think it's great that they were able to name the company now. I want to think that can be seen as a positive sign for this moving forward.

It looks like the test of 2500 units has been ongoing and continues. And, it looks like they keep finding ways to make the product better as they upgrade the versions. A big corporation can afford to take its time and you can be sure they want the product to be just right before deploying on a massive scale. Thus, it looks like yet another testing phase will occur.

But I would think they should be getting close to adding all the features that will be needed. So no guarantees yet, but this is BASF, and if all goes well they have the potential for a massive deployment of this device. And if BASF is on board, I suspect the iQST device becomes the standard for the industry. Who better than BASF to know exactly what such devices should offer? The others will take note I think.