LAUNCH TWO ACQUISITION CORP. FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2025
Launch Two Acquisition Corp. (the “Company”) filed its Form 10-Q for the quarter ended March 31, 2025, reporting a net loss of $1.4 million for the three months ended March 31, 2025. As of March 31, 2025, the Company had a cash balance of $24.6 million and total assets of $25.1 million. The Company’s condensed balance sheet as of March 31, 2025, shows total liabilities of $1.4 million and total shareholders’ deficit of $0.3 million. The Company’s management’s discussion and analysis of financial condition and results of operations highlights the Company’s focus on identifying and acquiring a target business, and notes that the Company has not yet identified a target business and has not commenced operations.
Overview
We are a blank check company formed in 2024 for the purpose of completing a business combination with one or more businesses or entities. We intend to use a combination of cash, shares, and debt to finance the business combination.
Results of Operations
As a blank check company, we have not engaged in any operations or generated any revenues to date. Our activities have been focused on organizational tasks, preparing for the initial public offering (IPO), and identifying a target company for a business combination.
For the three months ended March 31, 2025, we had net income of $2,215,852, which consisted of:
- Interest income on cash and marketable securities held in the trust account: $2,395,798
- Unrealized gain on marketable securities held in trust account: $27,727
- Interest on operating cash: $224
- General and administrative costs: $207,897
Factors That May Adversely Affect our Results of Operations
Our results and ability to complete a business combination could be negatively impacted by various factors, including:
- Downturns in financial markets or the economy
- Increases in oil prices, inflation, or interest rates
- Supply chain disruptions
- Declines in consumer confidence and spending
- Public health considerations
- Geopolitical instability
We cannot predict the likelihood or magnitude of these events and how they may affect our business.
Liquidity and Capital Resources
Prior to the IPO, our only source of liquidity was an initial purchase of shares by the Sponsor and loans from the Sponsor.
On October 9, 2024, we completed the IPO of 23,000,000 units at $10 per unit, raising $230 million in gross proceeds. We also sold 7,075,000 private placement warrants for $7.075 million.
As of March 31, 2025, we had $820,654 in cash and $235,961,864 in marketable securities held in the trust account. We intend to use the trust account funds to complete our business combination.
To fund working capital needs or transaction costs, the Sponsor or our officers/directors may provide working capital loans, which could be convertible into warrants.
Off-Balance Sheet Arrangements and Contractual Obligations
We do not have any off-balance sheet arrangements or long-term debt, capital leases, or other long-term liabilities.
Our key contractual obligations include:
- Administrative Services Agreement: $12,500 per month for office space, utilities, and administrative services
- Underwriting Agreement: 2% cash underwriting discount and 4.5-6.5% deferred underwriting fee payable upon completion of the business combination
Critical Accounting Estimates and Recent Accounting Standards
As of March 31, 2025, we did not have any critical accounting estimates. We adopted the new segment reporting standard ASU 2023-07 as required, which resulted in additional disclosures but did not materially impact the financial statements.
