NextTrip, Inc.
For the period ended Aug 31, 2025. Filed Oct 15, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Aug 31, 2025 · Filed Oct 15, 2025
NTRP$1.12+3.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-05-31; filed 2025-07-15.
0001641172-25-019738
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2025-08-31; filed 2025-10-15.
0001493152-25-018172
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 136 previous paragraphs and 172 current paragraphs.
91 unchanged; 34 reworded; 42 added; 11 removed; 0 previous and 5 current paragraphs rearranged.
Tables are not compared: 9 previous and 9 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (42)
Current report
Fair Value Measurements
Current report
We measure certain financial instruments at fair value, which requires management to make estimates and assumptions. For most items such as cash, receivables, and payables, fair value is straightforward because of their short-term nature. However, two obligations we assumed in connection with our acquisition of TA Pipeline LLC involve more judgment and could have a meaningful effect on our results.
Current report
Because the fair value of these obligations depends on factors outside of our control, such as our stock price and TA Pipeline’s revenues, the amounts we record may change from period to period. For example, a change in our assumed stock price volatility could change the value of the Put Option liability, while a similar change in projected revenues could affect the Milestone Payment liability.
Current report
Stock Based Compensation
Current report
We grant stock options, restricted stock, and other equity-based awards to employees, executives, directors, and consultants. The fair value of these awards is measured on the grant date and recognized as compensation expense over the vesting period.
Current report
Determining the fair value of stock options requires the use of valuation models, such as the Black-Scholes model, which involve assumptions about stock price volatility, expected term of the option, risk-free interest rates, and dividend yields. These assumptions are based on historical data and market conditions but involve judgment about future trends.
Current report
Because changes in these assumptions can significantly affect the estimated fair value, our stock-based compensation expense could vary materially from period to period. For instance, higher assumed volatility or longer expected option lives generally increase the fair value of options, leading to higher compensation expense.
Current report
Goodwill and Intangible Assets
Current report
We record goodwill and intangible assets in connection with business acquisitions. Goodwill represents the excess of the purchase price over the fair value of the net assets acquired. Intangible assets primarily include trade names, customer and supplier relationships, and technology.
Current report
We review goodwill and indefinite-lived intangible assets for impairment at least annually, or more frequently if events or changes in circumstances indicate that the carrying value may not be recoverable. This process requires management to make assumptions and estimates which involve significant judgment. Changes in assumptions could materially affect whether an impairment is recognized and the amount of any impairment charge.
Current report
Current Scale and Going Concern
Current report
We are in the earliest stages of commercial operations.
Current report
We expect to continue to incur net losses and negative cash flows from operations for the foreseeable future as we invest in technology enhancements, supplier relationships, and marketing initiatives. Throughout this report, whenever we discuss our operational achievements, ecosystem, or growth plans, you should consider that we presently have nominal revenues, limited operating history, minimal brand awareness, and will require significant additional capital to execute our business model.
Current report
The acquisition of TA Pipeline in August 2025 represents a significant milestone in NextTrip’s expansion of its Groups and MICE (Meetings, Incentives, Conferences, Exhibitions) vertical, an area with strong growth potential and margin contribution. TA Pipeline has established itself as a premier group-travel agency platform with deep expertise in delivering end-to-end solutions for conferences, conventions, weddings, and affinity groups, often servicing groups ranging from 50 to 5,000 travelers. Its strong relationships with suppliers, planners, and affinity partners align seamlessly with NextTrip’s vertically integrated “content-to-commerce” ecosystem, providing:
Current report
The TA Acquisition exemplifies the Company’s “buy-and-build” strategy of acquiring complementary assets that are accretive to revenues and synergistic with NextTrip’s broader vision of redefining how consumers and organizations discover, plan, and book travel. See “Recent Developments – Acquisition of TA Pipeline” for more details on the transaction.
Current report
Acquisition of TA Pipeline
Current report
On August 6, 2025, the Company entered into a Membership Interest Purchase Agreement (the “TA MIPA”) with TA Pipeline LLC (“TA”) and the members of TA (the “TA Members”), pursuant to which the Company purchased all of the issued and outstanding membership interests of TA from the TA Members (the “TA Acquisition”), resulting in TA becoming a wholly-owned subsidiary of the Company. The TA Acquisition closed on August 6, 2025.
Current report
Pursuant to the TA MIPA, as consideration for the TA Acquisition, at closing, the Company (i) paid the TA Members an aggregate of $443,169 in cash (the “TA Closing Payment”), $118,169 of which (the “Estimated Additional Closing Payment”) was paid as a purchase price adjustment based on the Members’ Deficit (as defined in the TA MIPA) set forth in the closing balance sheet provided by TA in connection with closing, as more particularly provided for by the TA MIPA; and (ii) issued an aggregate of 96,774 restricted shares of Company common stock (the “TA Closing Shares,” and together with the TA Closing Payment, the “TA Closing Consideration”) to the TA Members, valued at $300,000, based on a price per share of $3.10. The Estimated Additional Closing Payment is subject to adjustment, upward or downward, to the extent that the Members’ Deficit as of the closing date is determined to be less than or exceed $175,000, as provided in the TA MIPA. In addition to the TA Closing Consideration, and as further consideration for the TA Acquisition, the Company shall make an additional payment to the TA Members in the form of an earnout (the “TA Milestone Payment”), which shall be in an amount equal to five percent (5%) of the net revenues generated by TA during the 12 month period after the closing date (the “Milestone Period”), up to a maximum of $200,000. The TA Milestone Payment shall be paid to the TA Members within 10 days following completion of the Milestone Period and will be payable fifty percent (50%) in cash and fifty percent (50%) in restricted shares of Company common stock (the “TA Milestone Shares,” and together with the TA Closing Shares, the “TA Acquisition Shares”), to be calculated based on a price per share of $3.10.
Current report
In addition to the foregoing, in the event that the Fair Market Value of the Company’s common stock is less than $3.10 (the “Base Price”) during the applicable Exercise Period, each TA Member shall have the limited, one time option, to exercise one of the following rights as to some or all of their outstanding TA Acquisition Shares by delivering notice to the Company: (i) the right to require the Company to repurchase from the TA Member all or any portion of their outstanding TA Acquisition Shares at the Base Price; (ii) the right to require the Company to issue to such TA Member that number of additional shares of Company common stock (the “Top Up Shares”) as is necessary to make the aggregate value of the number of TA Acquisition Shares specified in the notice (based on the Fair Market Value) equal to the original aggregate value of the number of TA Acquisition Shares specified in the notice (based on the Base Price); and (iii) the right to require the Company to pay to such TA Member, in cash, an amount equal to the product of (x) the number of TA Acquisition Shares specified in the notice and (y) the positive difference, if any, between the Base Price and the Fair Market Value. For purpose of the foregoing rights, the “Exercise Period” means the three month period commencing upon the earlier of: (i) with respect to the TA Closing Shares, (x) the date that the TA Closing Shares first become eligible for public resale and (y) the first anniversary of the closing date; and (ii) with respect to the TA Milestone Shares, (x) the date that the TA Milestone Shares first become eligible for public resale and (y) the first anniversary of the closing date. Additionally, for purpose of the foregoing rights, “Fair Market Value” means the volume weighted average price per share of the Company’s common stock for the twenty consecutive trading days immediately preceding the notice date. During the Exercise Period, each of the TA Members shall be prohibited from engaging in certain transactions in the Company’s stock, as more particularly set forth in the TA MIPA.
Current report
In consideration for their receipt of the foregoing consideration, at closing of the TA Acquisition, each of the TA Members entered into restrictive covenant agreements providing for certain customary restrictive covenants, including customary non-competition, non-solicitation and no hire covenants for a period of three years following the closing date, and customary confidentiality covenants.
Current report
During the three months ended August 31, 2025, we recognized revenue of $757,648, as compared to $154,498 in the same period in 2024, an increase of $603,150, or 390%. The increase was primarily due to group travel-related revenues, a consortia payment, and commission income generated from Five Star Alliance (“FSA”) bookings.
Current report
Our gross margin for the three months ended August 31, 2025 was 21.9%, as compared to (0.6%) for the same period in 2024. The improvement in gross margin is primarily attributable to FSA travel bookings and group travel bookings.
Current report
Our total operating expenses for the three months ended August 31, 2025 were $3,368,452, as compared to $1,468,335 for the same period in 2024, an increase of $1,900,117, or 129%. The increase was primarily attributable to stock options granted to the Company’s former directors and an increase in professional services expenses, as further discussed below. Non-cash expenses, primarily consisting of stock based compensation, stock options granted to former directors, common and preferred shares issued to third parties for services, and depreciation and amortization totaled $1,271,354, or 37.7% of our operating expenses for the three months ended August 31, 2025, and $172,473, or 11.8% of our operating expenses for the same period in 2024.
Current report
Salary and benefits costs were $695,538 for the three months ended August 31, 2025, as compared to $628,759 for the same period in 2024, an increase of $66,779, or 11%. The increase was comprised of: (a) an increase in salaries of $43,823 due to the addition of two FSA employees pursuant to the acquisition; (b) an increase in taxes and benefits of $25,270; and(c) an increase in SAR expense of $2,493; these increases were partially offset by a decrease in severance expense of $4,808.
Current report
Stock-based compensation was $0 for the three months ended August 31, 2025, as compared to $13,841 for the same period in 2024, a decrease of $13,841 as all outstanding options are fully vested and no new options were granted during the period.
Current report
We incurred general and administrative costs of $31,736 during the three months ended August 31, 2025, as compared to $21,677 in the same period in 2024, an increase of $10,059, or 46%. The increase was primarily the result of $12,110 in travel expenses incurred for a conference, partially offset by a decrease in rent expense of $2,051.
Current report
We incurred marketing costs of $174,444 during the three months ended August 31, 2025, as compared to $51,347 during the same period in 2024. The increase of $123,097, or 240%, was due to increase in expenses associated with the enhancement of the Travel Magazine website of $77,600 aimed at driving traffic and generating business across all of our brands, an increase in media consulting expenses of $27,410 due to the engagement of a social media influencer agency for Journy.tv, an increase in outside marketing services of $15,203, and an increase in marketing and advertising expenses of $2,884.
Current report
Organizational costs for the three months ended August 31, 2025, were $470,105, as compared to $80,452 for the same period in 2024, an increase of $389,653. The increase is primarily attributable to the issuance of stock options to former directors as compensation for their services.
Current report
Depreciation and amortization expense for the three months ended August 31, 2025 was $216,625, as compared to $95,414 for the same period in 2024, an increase of $121,211, or 127%. The increase was primarily due to commencing amortization of Journy.tv, and the FSA tradename and software.
Current report
Other operating expenses were $83,911 for the three months ended August 31, 2025, as compared to $63,796 for the same period in 2024. The $20,115 increase was primarily due to a timing difference in billing for D&O and other insurance of $14,572 and an increase in merchant processing fees of $5,543, primarily related to TA Pipeline.
Current report
Six Months Ended August 31, 2025 Compared to the Six Months Ended August 31, 2024
Current report
During the six months ended August 31, 2025, we recognized revenue of $896,475, as compared to $343,291 in the same period in 2024, an increase of $553,184, or 161%. The increase was primarily due to group travel-related revenues, a consortia payment, and commission income generated in connection with the Five Star Alliance luxury travel bookings.
Current report
Our cost of revenue for the six months ended August 31, 2025 was $691,994, as compared to $329,036 for the same period in 2024, an increase of $362,958, or 110%. The increase was primarily attributable to the increase in sales from the second quarter of 2025 as compared to the second quarter of 2024.
Current report
Our gross margin for the six months ended August 31, 2025 was 22.8%, as compared to 4.2% for the same period in 2024. The improvement in gross margin is primarily attributable to FSA travel bookings and group travel bookings.
Current report
Our total operating expenses for the six months ended August 31, 2025 were $8,047,095, as compared to $3,435,948 for the same period in 2024, an increase of $4,611,147, or 134%. The increase was primarily attributable to stock options granted to former directors and an increase in professional services expenses, as further discussed below. Non-cash expenses, primarily consisting of stock based compensation, stock options granted to former directors, common and preferred shares issued to third parties for services, and depreciation and amortization totaled $4,251,469, or 52.8% of our operating expenses for the six months ended August 31, 2025, and $544,571, or 15.9% of our operating expenses for the same period in 2024.
Current report
We incurred marketing costs of $264,479 during the six months ended August 31, 2025, as compared to $207,536 during the same period in 2024. The increase of $56,943, or 27%, was for a consulting contract for marketing services of $75,744, increased Travel Magazine expenses of $53,776 aimed at driving traffic and generating business across all of our brands, and an increase media consulting expenses of $27,410 due to the engagement of a social media influencer agency. Partially offsetting the increase was a decrease of $88,560 in fees previously incurred from a former media advertising firm, and a decrease in contract labor of $11,427 due to the completion of project-based initiatives.
Current report
We incurred technology costs of $568,836 during the six months ended August 31, 2025, as compared to $325,691 during the same period in 2024. The increase of $243,145, or 75%, was primarily attributable to: (a) an increase in expenses in connection with Journy.tv of $222,775 for content licensing; (b) an increase in information technology and computer expenses of $11,715 primarily due to onboarding additional employees and use of outsourced IT services; (c) an increase in dues and subscriptions of $2,712 due to the implementation of our new CRM and business management system, Zoho One, partially offset by a decrease in marketing subscriptions; and (d) an increase in software expenses of $1,923 for hotel connections into the NextTrip database. Partially offsetting these increases is a net decrease of $1,610 in cloud database expenses primarily related to updating legacy code to optimize compatibility with our hosting infrastructure.
Current report
Professional service fees incurred in the six months ended August 31, 2025 were $2,598,548, as compared to $895,900 incurred during the same period in 2024, an increase of $1,702,648, or 190%. This increase was a result of: (a) an increase in investor relations expenses of $851,425 due to renewal of existing contracts and the addition of three new investor relations firms; (b) an increase in consulting fees of $381,889 due to contracts for services related to business development; (c) an increase in legal fees of $165,812 due to services related to various regulatory filings and acquisitions; (d) an increase in accounting expenses of $148,337 due to costs associated with technical accounting services related to the FSA, Journy.tv and TA Pipeline acquisitions, as well as a required two-year audit and first quarter financial statement review for FSA; (e) an increase in lending fees of $85,500 related to bridge loan financings; and (f) and increase in contract labor of $69,685 related to Journy.tv and other operations.
Current report
Depreciation and amortization expense for the six months ended August 31, 2025 was $423,274, as compared to $383,000 for the same period in 2024, an increase of $40,274, or 11%. The increase was primarily due to commencing amortization upon the product launch of our FAST network, Journy.tv, and the FSA tradename and software.
Current report
Subsequent to August 31, 2025, on September 10, 2025, the Company entered into securities purchase agreements (each a “Series Q Purchase Agreement”) with Andy Kaplan and Jimmy Byrd, two of our independent directors, pursuant to which the Company issued and sold respectively, 31,250 and 50,000 restricted shares of newly designated Series Q Nonvoting Convertible Preferred Stock of the Company (the “Series Q Preferred”), (the “Series Q Offering”) at a purchase price of $3.20 per share, resulting in proceeds to the Company of $260,000.
Showing the first 40 of 42 passages. Open the source sections for the rest.
Removed paragraphs (11)
Previous report
Alternatively, independent of the aforementioned milestones, for each month during the fifteen month period following the closing date in which $1,000,000 or more in gross travel bookings were generated by the combined company, to the extent not previously issued, the Contingent Shares would be issuable up to the maximum Contingent Shares issuable under the Exchange Agreement.
Previous report
Pursuant to Section 2.3(b)(vi) of the Exchange Agreement, whether a Milestone Event is met and the Contingent Shares are issuable under Section 2.3 is to be determined by the Company and NTH on a mutually agreeable date (each a “Milestone Payment Determination Date”) no later than thirty (30) days following notice by NTH to the Company that such Milestone Event has been met. If Contingent Shares are determined to be issuable under this Section, the Company is required to issue such additional Contingent Shares within 60 days following each Milestone Payment Determination Date.
Previous report
As of December 9, 2024, no Contingent Shares had been issued despite neither party disputing that, at such time, three of the four milestones had been met. This was a result of delays with the Company’s Form S-1 registration statement and the Company’s pending initial listing application with Nasdaq (the “Regulatory Delays”) pursuant to Nasdaq Listing Rule 5110(a). NTH had not sent formal notice to the Company at such time but expressed an intent to do so in the near future.
Previous report
As a result, on December 9, 2024, the Company and NTH entered into that certain Forbearance Agreement, whereby NTH agreed to forbear from issuing the Milestone Payment Determination Date notice until January 31, 2025 or earlier in the event of a default (the “Forbearance Expiration Date”) in exchange for an agreement by the Company that, if such Nasdaq initial listing application is not approved by such date that, (i) all earned Contingent Shares will be issued withing five (5) business days of the Forbearance Expiration Date and (ii) all such Board Appointment Rights will be exercised and the director designees will be approved within five (5) business days of the Forbearance Expiration Date. On January 31, 2025, the Nasdaq initial listing application was not yet approved and the parties entered into Amendment No. 1 to Forbearance Agreement to extend the Forbearance Expiration Date to March 31, 2025.
Previous report
During the three months ended May 31, 2025, we recognized revenue of $138,827, as compared to $188,793 in the same period in 2024, a decrease of $49,965, or 27%. The decrease was primarily due to limited marketing expenditures resulting from cash flow constraints.
Previous report
Our total operating expenses for the three months ended May 31, 2025 were $4,678,643, as compared to $1,967,613 for the same period in 2024, an increase of $2,711,030, or 138%. The increase was primarily attributable to the stock options granted to the board of directors and an increase in professional services expenses.
Previous report
We incurred marketing costs of $90,035 during the three months ended May 31, 2025, as compared to $156,188 during the same period in 2024. The decrease of $66,153, or 42%, was due to a decrease in contract labor of $26,630, a decrease in Travel Magazine expenses of $23,824, and a decrease in media advertising of $14,987.
Previous report
Depreciation and amortization expense for the three months ended May 31, 2025 was $206,650, as compared to $287,586 for the same period in 2024, a decrease of $80,936, or 28%. The decrease was primarily due to no new equipment purchases and an increase in fully amortized intangible assets as of May 31, 2025.
Previous report
On April 1, 2025, we entered into a securities purchase agreement (the “Alumni Purchase Agreement”) with Alumni Capital LP (“Alumni”) for the sale of a short-term promissory note (the “Alumni Note”) and warrants to purchase 80,000 shares of common stock to Alumni for total consideration of $300,000. The Alumni Note was in the principal amount of $360,000 with an original issue discount of $60,000 and guaranteed interest on the principal amount of 10% per annum, which was due and payable on July 1, 2025. In the event of a failure to re-pay the Alumni Note on or before the maturity date, the interest rate would have increased to the lesser of 22% per annum or the maximum amount permitted under law from the due date thereof until the same was paid. The Alumni Note would have been convertible into shares of common stock of the Company only upon an event of default. On July 1, 2025, we repaid the outstanding balance of the Alumni Note in full, including all accrued interest thereon.
Previous report
On April 9, 2025, we entered into two promissory notes (together, the “Trust Notes”) with Donald P. Monaco Insurance Trust (the “Trust”) under our $2.0 million line of credit. Donald Monaco, chairman of our Board, is the trustee of the Trust. The first note had a principal balance of $500,000 and was issued in exchange for a new cash payment provided by Mr. Monaco. The second note had a principal balance of $145,000 and was issued in exchange for cash advances previously made by Mr. Monaco to the Company.
Previous report
Subsequent to the quarter ended May 31, 2025, the Company entered into a securities purchase agreement with an accredited investor, pursuant to which it sold such investor 75,000 restricted shares of common stock for an aggregate purchase price of $226,500.
Reworded paragraphs (34)
Previous wording
The Contingent Shares, together with the shares of our common stock issued at the closing, was not to exceed 6,000,000 shares ofour common stock, or approximately 90.2% of our issued and outstanding shares of common stock immediately prior to closing.
Current wording
The Contingent Shares, together with the shares of our common stock issued at the closing, was not to exceed 6,000,000 shares of our common stock, or approximately 90.2% of our issued and outstanding shares of common stock immediately prior to closing.
Previous wording
In connection with the NextTrip Acquisition, the Company and Nasdaq determined that the issuance of Contingent Shares upon achievement of any one of the Milestone Events would result in a change in control of the Company under Nasdaq Listing Rule 5635(a). Pursuant to Nasdaq Listing Rule 5110(a), the Company was required to submit an initial listing application with Nasdaq and to obtain Nasdaq approval of the initial listing application prior to the issuance of the Contingent Shares; failure to obtain such approval in advance of the Contingent Share issuance would have resulted in Nasdaq issuing the Company a delisting determination and commencing delisting proceedings with respect to its common stock.
Current wording
In connection with the NextTrip Acquisition, the Company and Nasdaq determined that the issuance of Contingent Shares upon achievement of any one of the Milestone Events would result in a change in control of the Company under Nasdaq Listing Rule 5635(a). Pursuant to Nasdaq Listing Rule 5110(a), the Company was required to submit an initial listing application with Nasdaq and to obtain Nasdaq approval of the initial listing application prior to the issuance of the Contingent Shares.
Previous wording
In July 2025, Mr. Kerby, in his capacity as the NTH Representative, informed the Company of his election to exercise the Board Appointment Rights pursuant to the Exchange Agreement and designated Stephen Kircher, Jimmy Byrd, Carmen Diges and David Jiang (collectively, the “NTH Appointees”) as the individuals to replace the continuing legacy Sigma directors. On July 14, 2025, the Company’s Board of Directors appointed the NTH Appointees as directors of the Company, in each case effective July 28, 2025, at which time Salvatore Battinelli, Jacob Brunsberg, Dennis Duitch and Kent Summers will resign as directors of the Company. Stephen Kircher shall serve as a Class I director, with his initial term expiring at the Company’s 2028 Annual Meeting of Stockholders; Jimmy Byrd shall serve as a Class II director, with his initial term expiring at the Company’s 2026 Annual Meeting of Stockholders; and Ms. Diges and Mr. Jiang shall each serve as a Class III director, with their initial terms expiring at the Company’s 2027 Annual Meeting of Stockholders. Each of NTH Appointees will serve as a director for the balance of their respective initial terms, and until his or her successor is elected and qualified, subject to his or her earlier death, resignation or removal.
Current wording
In July 2025, Mr. Kerby, in his capacity as the NTH Representative, informed the Company of his election to exercise the Board Appointment Rights pursuant to the Exchange Agreement and designated Stephen Kircher, Jimmy Byrd, Carmen Diges and David Jiang (collectively, the “NTH Appointees”) as the individuals to replace the continuing legacy Sigma directors. On July 14, 2025, the Company’s Board of Directors appointed the NTH Appointees as directors of the Company, in each case effective July 28, 2025, at which time Salvatore Battinelli, Jacob Brunsberg, Dennis Duitch and Kent Summers resigned as directors of the Company. Stephen Kircher shall serve as a Class I director, with his initial term expiring at the Company’s 2028 Annual Meeting of Stockholders; Jimmy Byrd shall serve as a Class II director, with his initial term expiring at the Company’s 2026 Annual Meeting of Stockholders; and Ms. Diges and Mr. Jiang shall each serve as a Class III director, with their initial terms expiring at the Company’s 2027 Annual Meeting of Stockholders. Each of NTH Appointees will serve as a director for the balance of their respective initial terms, and until his or her successor is elected and qualified, subject to his or her earlier death, resignation or removal.
Previous wording
On January 27, 2025, as creditors of NextPlay, Donald P. Monaco, the Company’s Chairman, William Kerby, the Company’s Chief Executive Officer, and Ian Sharpe, the Chief Operating Officer of the Company’s Media division, filed a petition to force NextPlay into involuntary bankruptcy as a result of unpaid fees. The proceedings are ongoing and the outcome at this time is uncertain and cannot be predicted. As a result, management has determined that the collectability of the NextPlay Note is uncertain and has therefore established an allowance for doubtful accounts for the entire balance of $2,567,665.
Current wording
On January 27, 2025, as creditors of NextPlay, Donald P. Monaco, the Company’s Chairman, William Kerby, the Company’s Chief Executive Officer, and Ian Sharpe, the Chief Operating Officer of the Company’s Media division, filed a petition to force NextPlay into involuntary bankruptcy as a result of unpaid fees. The proceedings are ongoing and the outcome at this time is uncertain and cannot be predicted. As a result, management has determined that the collectability of the NextPlay Note is uncertain and has therefore established an allowance for credit losses for the entire balance of $2,567,665.
Previous wording
NextTrip is an early-stage, technology-driven travel company developing an integrated travel booking and media platform designed to connect leisure, group and business travelers to the world. Our travel booking platform is powered by our proprietary NXT2.0 booking engine, which offers extensive inventory, supporting both travelers and distributors with a platform for curating personalized experiences and efficient trip planning and booking. We market our travel services through several core brands including NextTrip Vacations (direct-to-consumer leisure travel), Five Star Alliance (luxury and cruise bookings) and NextTrip Business (small-to-mid-sized corporate travel) and differentiate our platform through specialty features, including specialized widgets for groups (the “Groups Platform”) and travel agents (the “Travel Agent Platform”), as well as PayDlay, a delayed payment booking option. Complementing our booking engine are our media properties, including Journy.tv, Compass.tv and Travel Magazine, which provide destination content that we believe will drive high-intention traffic into our booking funnel and, over time, constitute a separate high-margin advertising revenue stream.
Current wording
NextTrip is an early-stage, technology-driven travel company developing an integrated travel booking and media platform designed to connect leisure, group and business travelers to the world. Our travel booking platform is powered by our proprietary NXT2.0 booking engine, which offers extensive inventory, supporting both travelers and distributors with a platform for curating personalized experiences and efficient trip planning and booking. We market our travel services through several core brands including NextTrip Vacations (direct-to-consumer leisure travel), Five Star Alliance (luxury and cruise bookings) and NextTrip Business (small-to-mid-sized corporate travel) and differentiate our platform through specialty features, including specialized widgets for groups (the “Groups Platform”) and travel agents (the “Travel Agent Platform”), as well as PayDlay, a delayed payment booking option. Complementing our booking engine are our media properties, including Journy.tv and Travel Magazine, which provide destination content that we believe will drive high-intention traffic into our booking funnel and, over time, constitute a separate high-margin advertising revenue stream. As part of streamlining our media assets, we merged Compass.tv into Journy.tv in July 2025 to create a unified offering of both FAST (Free Ad-Supported Streaming Television) and VOD (Video on Demand) assets.
Previous wording
By integrating our media properties with our travel booking platform, our ambition is to build a next-generation travel solution for consumers, allowing them to better research and explore desired travel destinations. To accomplish this, we will be using content from ours and others’ media platforms featuring travel videos, blogs and articles along with access to curated travel products from our strategic partnerships, all supported by our technology and call center agents. Upon full integration of our travel and media platforms, we believe our offers will both inspire and empower consumers to make informed choices when booking. This contrasts with the existing online travel agency (“OTA”) model that focuses on volume bookings with little to no service support.
Current wording
By integrating our media properties with our travel booking platform, our objective is to build a next-generation travel solution for consumers, allowing them to better research and explore desired travel destinations. To accomplish this, we have and will be using content from ours and others’ media platforms featuring travel videos, blogs and articles along with access to curated travel products from our strategic partnerships, all supported by our technology and call center agents. Upon full integration of our travel and media platforms, we believe our offers will both inspire and empower consumers to make informed choices when booking. This contrasts with the existing online travel agency (“OTA”) model that focuses on volume bookings with little to no service support.
Previous wording
At the core of our business is our proprietary, direct-to-consumer NXT2.0 travel booking engine, which has been continually enhanced and developed through a series of acquisitions of a variety of media and travel assets. NXT2.0 powers several websites, including our main leisure site, nexttrip.com, and fivestaralliance.com, our widgets for The Groups and Travel Agent Platforms, as well as providing travel booking solutions for our media hubs, Journy.tv, travelmagazine.com and Compass.tv. We serve both leisure and business travelers by offering them access to travel blogs, videos and concierge assistance to aid in planning travel, coupled with our proprietary booking platform for the direct purchase of flights, hotels, vacation homes, cruise, tours, and other travel products. Our content includes destination guides, maps and travel tips, designed to help travelers plan memorable trips and book those trips on our travel platform.
Current wording
At the core of our business is our proprietary, direct-to-consumer NXT2.0 travel booking engine, which has been continually enhanced and developed through a series of acquisitions of a variety of media and travel assets. NXT2.0 powers several websites, including our main leisure site, nexttrip.com, and fivestaralliance.com, our widgets for The Groups and Travel Agent Platforms, as well as providing travel booking solutions for our media hubs, Journy.tv and travelmagazine.com. We serve both leisure and business travelers by offering them access to travel blogs, videos and concierge assistance to aid in planning travel, coupled with our proprietary booking platform for the direct purchase of flights, hotels, vacation homes, cruise, tours, and other travel products. Our content includes destination guides, maps and travel tips, designed to help travelers plan memorable trips and book those trips on our travel platform.
Previous wording
We leverage our media brands—TravelMagazine.com, Compass.tv, and Journy.tv—as strategic tools to generate travel bookings by integrating content, marketing, and booking technology as well as to generate advertising revenues for third-party content. The strategy includes generating content marketing and inspiration, integrating booking opportunities into that content and generating feedback from such advertising data to better target and identify travel interests and intent, which is intended to lead to growing brand trust and authority and future partnerships and opportunities for sponsored advertising content.
Current wording
We leverage our media brands—TravelMagazine.com and Journy.tv—as strategic tools to generate travel bookings by integrating content, marketing, and booking technology as well as to generate advertising revenues for third-party content. The strategy includes generating content marketing and inspiration, integrating booking opportunities into that content and generating feedback from such advertising data to better target and identify travel interests and intent, which is intended to lead to growing brand trust and authority and future partnerships and opportunities for sponsored advertising content.
Previous wording
Key**media brands and partnership include:
Current wording
Key media brands and partnerships include:
Previous wording
We are building our own media and advertising ecosystem through Travel Magazine, Journy.tv and Compass.tv. These media platforms are designed to allow users to explore and educate themselves on travel. The revenue strategy in the media division is two-pronged: (1) as the number of viewers/users grows, it drives the advertising rates we can charge third-parties to promote travel products and services to our audience and (2) outside of the direct advertising dollars generated from our media platforms which are expected to become a key driver of higher margin revenue than those earned from travel product sales, as the audience grows it will provide additional opportunities for us to promote ours own travel offerings to highly targeted viewers, thus lessening the need for spending significant marketing dollars through other mediums to attract consumers.
Current wording
We are building our own media and advertising ecosystem through Travel Magazine and Journy.tv. These media platforms are designed to allow users to explore and educate themselves on travel. The revenue strategy in the media division is two-pronged: (1) as the number of viewers/users grows, it drives the advertising rates we can charge third-parties to promote travel products and services to our audience and (2) outside of the direct advertising dollars generated from our media platforms which are expected to become a key driver of higher margin revenue than those earned from travel product sales, as the audience grows it will provide additional opportunities for us to promote ours own travel offerings to highly targeted viewers, thus lessening the need for spending significant marketing dollars through other mediums to attract consumers.
Previous wording
To drive this initiative, we have entered into partnerships with Travel Spike and Leap Media Group, respected leaders in the travel category with decades of experience in TV advertising, media planning and buying. Compass.tv is now equipped to deliver branded entertainment content and advertising seamlessly across its platform, supported by targeted media strategy designed to optimize revenue well delivering high quality content to travel enthusiasts.
Current wording
To drive this initiative, we have entered into partnerships with Travel Spike and Leap Media Group, respected leaders in the travel category with decades of experience in TV advertising, media planning and buying. Journy.tv is now equipped to deliver branded entertainment content and advertising seamlessly across its platform, supported by targeted media strategy designed to optimize revenue well delivering high quality content to travel enthusiasts.
Previous wording
Our ability to capitalize on existing travel technology platforms is severely restricted due to the lack of funding to drive marketing programs. Enhancements to the existing platforms along with the introduction of new programs under development are needed to complete the model. The timeline to complete these programs is dependent upon our ability to raise capital; however, we believe that most programs can be delivered within 180 days of obtaining such necessary funding. Once fully functioning, we believe the model will deliver accelerated growth as its “conversion technology” focuses on underserved areas in the travel sector utilizing platforms (i.e. PayDlay, Groups bookings and Travel Agents) that are not well serviced by the major travel industry leaders. Additionally, we have introduced engagement and media solutions (i.e. Journy.tv, Compass.tv and Travel Magazine), allowing users to better plan future travel. We believe a natural extension of providing users with media solutions to assist with travel planning will further the development and growth of a NextTrip ecosystem. This ecosystem is expected to assist us in reducing external marketing expenditures while creating a new revenue channel from targeted and timely advertising designed to assist users in their travel planning. Upon completion of the NextTrip model, we expect to drive revenues from travel solutions outside of the focus of major travel competitors.
Current wording
Our ability to capitalize on existing travel technology platforms is severely restricted due to the lack of funding to drive marketing programs. Enhancements to the existing platforms along with the introduction of new programs under development are needed to complete the model. The timeline to complete these programs is dependent upon our ability to raise capital; however, we believe that most programs can be delivered within 180 days of obtaining such necessary funding. Once fully functioning, we believe the model will deliver accelerated growth as its “conversion technology” focuses on underserved areas in the travel sector utilizing platforms (i.e. PayDlay, Groups bookings and Travel Agents) that are not well serviced by the major travel industry leaders. Additionally, we have introduced engagement and media solutions (i.e. Journy.tv Travel Magazine), allowing users to better plan future travel. We believe a natural extension of providing users with media solutions to assist with travel planning will further the development and growth of a NextTrip ecosystem. This ecosystem is expected to assist us in reducing external marketing expenditures while creating a new revenue channel from targeted and timely advertising designed to assist users in their travel planning. Upon completion of the NextTrip model, we expect to drive revenues from travel solutions outside of the focus of major travel competitors.
Previous wording
Additionally, in accordance with the Board Appointment Rights provided for in the Exchange Agreement, on July 14, 2025, the Company’s Board of Directors appointed the NTH Appointees as directors, in each case effective July 28, 2025, at which time Salvatore Battinelli, Jacob Brunsberg, Dennis Duitch and Kent Summers will resign as directors of the Company. Stephen Kircher shall serve as a Class I director, with his initial term expiring at the Company’s 2028 Annual Meeting of Stockholders; Jimmy Byrd shall serve as a Class II director, with his initial term expiring at the Company’s 2026 Annual Meeting of Stockholders; and Ms. Diges and Mr. Jiang shall each serve as a Class III director, with their initial terms expiring at the Company’s 2027 Annual Meeting of Stockholders. Each of NTH Appointees will serve as a director for the balance of their respective initial terms, and until his or her successor is elected and qualified, subject to his or her earlier death, resignation or removal. Additionally, effective July 28, 2025, the Board appointed the NTH Appointees to serve on the following committees of the Board:
Current wording
Additionally, in accordance with the Board Appointment Rights provided for in the Exchange Agreement, on July 14, 2025, the Company’s Board of Directors appointed the NTH Appointees as directors, in each case effective July 28, 2025, at which time Salvatore Battinelli, Jacob Brunsberg, Dennis Duitch and Kent Summers resigned as directors of the Company. Stephen Kircher shall serve as a Class I director, with his initial term expiring at the Company’s 2028 Annual Meeting of Stockholders; Jimmy Byrd shall serve as a Class II director, with his initial term expiring at the Company’s 2026 Annual Meeting of Stockholders; and Ms. Diges and Mr. Jiang shall each serve as a Class III director, with their initial terms expiring at the Company’s 2027 Annual Meeting of Stockholders. Each of NTH Appointees will serve as a director for the balance of their respective initial terms, and until his or her successor is elected and qualified, subject to his or her earlier death, resignation or removal. Additionally, effective July 28, 2025, the Board appointed the NTH Appointees to serve on the following committees of the Board:
Previous wording
Our cost of revenue for the three months ended May 31, 2025 was $99,921, as compared to $173,581 for the same period in 2024, a decrease of $73,660, or 42%. The decrease was primarily attributable to the decrease in sales from the first quarter of 2025 as compared to the first quarter of 2024.
Current wording
Our cost of revenue for the three months ended August 31, 2025 was $592,073, as compared to $155,455 for the same period in 2024, an increase of $436,618, or 281%. The increase was primarily attributable to the increase in sales from the second quarter of 2025 as compared to the second quarter of 2024.
Previous wording
We incurred technology costs of $321,815 during the three months ended May 31, 2025, as compared to $184,669 during the same period in 2024. The increase of $137,146, or 74%, was primarily attributable to (a) an increase in expenses in connection with Compass.tv of $93,000; (b) an increase in expense related to Journy.tv of $61,806; (c) an increase in software expenses of $10,914; (d) an increase in information technology and computer expenses of $8,665; and (e) an increase of $3,324 in cloud database expenses. Partially offsetting these increases is a decrease in dues and subscription expenses of $40,564 in connection with decreased marketing subscriptions.
Current wording
We incurred technology costs of $267,021 during the three months ended August 31, 2025, as compared to $141,022 during the same period in 2024. The increase of $125,999, or 89%, was primarily attributable to: (a) an increase in expenses in connection with Journy.tv of $98,599 for content licensing; (b) an increase in dues and subscriptions expense of $11,101 primarily related to the integration of our new CRM and business management system, Zoho One; (c) an increase of $9,690 in cloud database expenses related to the addition of hosting FSA; (d) an increase in information technology and computer expenses of $6,276; and (e) an increase in software expenses of $333.
Previous wording
Professional service fees incurred in the three months ended May 31, 2025 were $1,149,476, as compared to $523,873 incurred during the same period in 2024, an increase of $625,603, or 119%. This increase was a result of: (a) an increase in investor relations expenses of $457,350 (b) an increase in accounting expenses of $94,940 due to the FSA acquisition and timing difference in year-end audit expenses; (c) an increase in outside consulting fees of $137,326 due to a consulting contract with a strategic business development firm; and (d) an increase in lending fees of $61,500 related to bridge loan financings. Partially offsetting these increases were decreased legal expenses of $94,404, and decreased contract labor of $31,109.
Current wording
Professional service fees incurred in the three months ended August 31, 2025 were $1,429,072, as compared to $372,027 incurred during the same period in 2024, an increase of $1,057,045, or 284%. This increase was a result of: (a) an increase in investor relations expenses of $394,075 due to the renewal of existing contracts plus the addition of three new contracts; (b) an increase in legal fees of $260,217 due to services related to various regulatory filings and acquisitions; (c) an increase in consulting fees of $231,424 for business development initiatives; (d) an increase in contract labor related to Journy.tv and operations of $93,932; (e) an increase in accounting expenses of $53,397 due to technical accounting services related to the acquisition of FSA and Journy.tv.; and (f) an increase in lending fees of $24,000 related to bridge loan financings.
Previous wording
During the three months ended May 31, 2025, we realized net other income of $193,812, as compared to net other expense of $35,225 in the same period in 2024. The increase in net other income of $540,245 was primarily due to a settlement agreement between NextTrip Group, LLC and the Company related to misrepresentation of the collectability of the NextPlay Technologies, Inc. promissory note receivable, partially offset by: (a) a loss of $70,100 related to the extinguishment of debt, and (b) interest expense of $276,333 primarily in connection the amortization of the debt discount associated with bridge loans and interest expense associated with notes payable.
Current wording
During the three months ended August 31, 2025, we realized net other income of $304,722, as compared to net other expense of $64,227 in the same period in 2024. The increase in net other income of $368,949 was primarily due to a settlement agreement between NextTrip Group, LLC and the Company related to the NextPlay Technologies, Inc. promissory note receivable of $583,000, and the August 31, 2025 revaluation of the derivative liability, which decreased the liability by $10,000, partially offset by (a) interest expense of $171,105 in connection the amortization of the debt discount associated with bridge loans and (b) interest expense associated with notes payable and other expenses of $52,946.
Previous wording
Preferred dividends for the three months ended May 31, 2025 were $64,463, as compared to $10,688 for the same period in 2024. The increase was due to dividends paid to the holders of shares of Series L and Series M Preferred stock issued in connection with debt conversions in December 2024.
Current wording
Preferred dividends for the three months ended August 31, 2025 were $183,263 as compared to $10,688 for the same period in 2024. The increase was due to dividends paid to the holders of shares of Series L and Series M Preferred stock issued in connection with debt conversions in December 2024 and February 2025.
Previous wording
In the three months ended May 31, 2025, the net loss from continuing operations totaled $4,457,232, as compared to a net loss from continuing operations of $1,987,626 for the same period in 2024. The operating loss component increased by $2,687,335 in 2025, partially offset by an increase in the other income component of $229,037.
Current wording
In the three months ended August 31, 2025, the net loss from continuing operations totaled $2,898,155, as compared to a net loss from continuing operations of $1,533,519 for the same period in 2024 an increase of $1,364,636. The operating loss component increased by $1,733,585 in 2025, partially offset by an increase in the other income component of $368,949.
Previous wording
Salary and benefits costs were $696,914 for the three months ended May 31, 2025, as compared to $626,752 for the same period in 2024, an increase of $70,162, or 11%. The increase was comprised of: (a) an increase in salaries and benefits of 25,813 due to the conversion of two Five Star Alliance employees to NextTrip employees; (b) an increase in taxes and benefits of $29,653 and (c) an increase in SAR expense of $14,696 due to revaluation in April 2025.
Current wording
Salary and benefits costs were $1,392,453 for the six months ended August 31, 2025, as compared to $1,255,511 for the same period in 2024, an increase of $136,942, or 11%. The increase was comprised of: (a) an increase in salaries of $69,637 due to the addition of two Five Star Alliance employees pursuant to the acquisition; (b) an increase in taxes and benefits of $46,160; (c) an increase in SAR expense of $17,189 due to a revaluation in April 2025; and (d) an increase in bonus and commission expense of $8,764; partially offset by a decrease in severance expense of $4,808.
Previous wording
Stock-based compensation was $138,325 for the three months ended May 31, 2025, as compared to $16,394 for the same period in 2024, an increase of $121,931. This increase was primarily the result of an option grant to an employee that was fully vested on the date of the grant.
Current wording
Stock-based compensation was $138,325 for the six months ended August 31, 2025, as compared to $30,235 for the same period in 2024. This increase of $108,090. was due to a stock option grant to an employee that was fully vested on the date of the grant.
Previous wording
We incurred general and administrative costs of $30,588 during the three months ended May 31, 2025, as compared to $27,555 in the same period in 2024, an increase of $3,033, or 11%. The increase was primarily the result of a travel expenses incurred for a micro-cap conference in April 2025 of $14,376, partially offset by a decrease in payroll services fees of $5,627, lower utility expenses of $2,050, and lower license and filing fees of $3,666.
Current wording
We incurred general and administrative costs of $62,324 during the six months ended August 31, 2025, as compared to $49,231 in the same period in 2024, an increase of $13,093, or 27%. The increase was primarily the result of $21,460 in travel expenses incurred for conferences, partially offset by a decrease in payroll services fees of $7,712 as a result of changing payroll service providers, lower license and filing fees of $2,868, and lower rent expenses of $2,417.
Previous wording
Organizational costs for the three months ended May 31, 2025, were $1,999,670, as compared to $28,737 for the same period in 2024, an increase of $1,970,933. The increase is primarily due to an increase in directors’ compensation related to fully vested stock options issued to the directors during the quarter.
Current wording
Organizational costs for the six months ended August 31, 2025, were $2,469,775, as compared to $109,189 for the same period in 2024, an increase of $2,360,586. The increase is primarily attributable to fully vested stock options granted to former directors.
Previous wording
Other operating expenses were $45,170 for the three months ended May 31, 2025, as compared to $115,859 for the same period in 2024. The $70,689 decrease was primarily due to the reduced cost of directors and officers and other insurance costs of $52,268 and a decrease in merchant processing fees of $15,532.
Current wording
Other operating expenses were $129,081 for the six months ended August 31, 2025, as compared to $179,655 for the same period in 2024. The $50,574 decrease was primarily due to the reduced cost of D&O and other insurance costs of $37,695 and a net decrease in merchant processing fees of $18,878 due to engaging a new merchant processor with lower rates.
Previous wording
The net gain on discontinued operations for the three months ended May 31, 2025 was $0 as compared to $8,909 for the same period in 2024.
Current wording
The net gain on discontinued operations for the six months ended August 31, 2025 was $0 as compared to $7,778 for the same period in 2024.
Previous wording
Our net loss applicable to common stockholders for the three months ended May 31, 2025, was $4,521,695, as compared to $1,989,405 for the same period in 2024, an increase of $2,532,290, or 127%. The increase was primarily attributable to an increase in operating loss from continued operations of $2,687,336 and an increase in preferred dividends of $53,775, a loss on the 49% share of net earnings for the equity method investee of $11,307, and a decrease in income from discontinued operation of $8,909, partially offset by an increase in other income of $229,037.
Current wording
Our net loss applicable to common stockholders for the six months ended August 31, 2025, was $7,603,113, as compared to $3,534,743 for the same period in 2024, an increase of $4,068,370, or 115%. The increase was primarily attributable to an increase in operating loss from continued operations of $4,420,921 and an increase in preferred dividends of $226,349, a loss on the 49% share of net earnings for the equity method investee of $11,307, and a decrease in income from discontinued operation of $7,778, partially offset by an increase in other income of $597,985.
Previous wording
As of May 31, 2025, we had $130,906 in cash and a working capital deficit of $1,142,891, as compared to $1,062,367 in cash and a working capital deficit of $105,577 as of February 28, 2025. Additionally, at May 31, 2025, the amount due under our related party line of credit totaled $1, 486,575.
Current wording
As of August 31, 2025, we had $1,837,654 in cash and a working capital deficit of $1,477,647, as compared to $1,062,367 in cash and a working capital deficit of $105,577 as of February 28, 2025. Additionally, at August 31, 2025, the amount due under our related party line of credit totaled $2,831,575.
Previous wording
We received an initial advance of $1,045,000 under the MIP Line of Credit, which was used to repay (i) a $400,000 cash advance previously made by the Trust to the Company (ii) and all outstanding indebtedness under the terms of the Trust Notes, totaling $645,000. Subsequent advances during May 2025 totaled $441,575, bringing the total outstanding principal at May 31, 2025 to $1,486,575. From June 1, 2025 through July 10, 2025 additional advances totaled $700,000, and as of July 10, 2025 the outstanding principal balance was $2,186,575.
Current wording
We received an initial advance of $1,045,000 under the MIP Line of Credit, which was used to repay (i) a $400,000 cash advance previously made by the Trust to the Company (ii) and all outstanding indebtedness under the terms of the Trust Notes, totaling $645,000. Subsequent advances through August 2025 totaled $1,786,575, bringing the total outstanding principal at August 31, 2025 to $2,831,575. From September 1, 2025 through September 10, 2025 additional advances totaled $168,425, and as of September 10, 2025 the outstanding principal balance was $3,000,000, which is the maximum amount available under the MIP Line of Credit.
Previous wording
At May 31, 2025, there were other outstanding short term notes payable in the aggregate amount of $654,160, which had maturity dates between August 15, 2025 and December 31, 2025.
Current wording
At August 31, 2025, there were other outstanding short-term notes payable in the aggregate amount of $563,501, which had maturity dates between September 15, 2025 and December 31, 2025.
Previous wording
Net cash used in operating activities from continuing operations totaled $1,042,658 during the three months ended May 31, 2025 as compared to $1,151,220 during the same period in 2024, a decrease of $108,562, or 9.4%.
Current wording
Net cash used in operating activities from continuing operations totaled $470,283 during the six months ended August 31, 2025 as compared to $1,960,326 during the same period in 2024, a decrease of $1,490,043, or 76.0%.
Previous wording
During the three months ended May 31, 2025, the net cash used in operating activities was the result of a net loss of $4,457,232 before payment of preferred dividends, partially offset by changes in working capital of $124,303, and non-cash expenses of $3,290,271 related to stock-based compensation of $2,086,869, depreciation and amortization of $206,650, amortization of prepaid expenses of $694,912, amortization of debt discount of $231,740 and a loss on the extinguishment of debt of $70,100. Changes in working capital were driven by an increase in deferred revenue of $210,728, a decrease in prepaid expenses of $183,327, and the assumption of the SBA EIDL loan from FSA of $98,757, partially offset by an increase in accounts receivable of $87,554 and a decrease in accounts payable and accrued expenses of $280,955.
Current wording
During the six months ended August 31, 2025, the net cash used in operating activities was the result of a net loss of $7,355,388 before payment of preferred dividends, partially offset by changes in working capital of $2,149,102, and non-cash expenses of $4,736,003 related to stock options issued to former directors totaling $2,368,709, employee stock-based compensation of $138,325, depreciation and amortization of $423,274, amortization of prepaid expenses of $1,323,199, amortization of debt discount of $402,846, a write-off of technology costs of $19,550 related to an abandoned software implementation, and a loss on the extinguishment of debt of $70,100, partially offset by a gain on the derivative liability of $10,000. Changes in working capital were driven by an increase in deferred revenue of $2,000,939 related to the TA Pipeline acquisition, an increase in accounts payable and accrued expenses of $87,598, a decrease in prepaid expenses of $206,382, and the assumption of the SBA EIDL loan from FSA of $98,532 partially offset by an increase in accounts receivable of $244,349.
Previous wording
During the three months ended May 31, 2024, the net cash used in operating activities was the result of a net loss of $1,987,626 before payment of preferred dividends, partially offset by changes in working capital of $532,426, and non-cash expenses of $303,980 related to depreciation and amortization of $287,586 and stock-based compensation of $16,394. Changes in working capital were driven by a decrease in accounts receivable of $6,322, an increase in deferred revenue of $14,280, and an increase in accounts payable and accrued expenses of $534,493, partially offset by an increase in prepaid expenses of $19,669.
Current wording
During the six months ended August 31, 2024, the net cash used in operating activities was the result of a net loss of $3,521,145 before preferred dividends, partially offset by changes in working capital of $1,147,584, and non-cash expenses of $413,235 related to depreciation and amortization of $383,000 and stock-based compensation of $30,235. Changes in working capital were driven by a decrease in accounts receivable of $22,881, a decrease in prepaid expenses of $96,051, and an increase in accounts payable and accrued expenses of $1,033,506, partially offset by an increase in security deposits of $3,000 and a decrease in deferred revenue of $1,854.
Previous wording
Net cash used in investing activities during the three months ended May 31, 2025 was $1,281,503, which compares to $169,406 of cash used in investing activities during the same period of 2024, an increase of $1,112,097, or 656.5%. The increase resulted from $900,000 related to the acquisition of FSA and $300,000 related to the Journy.tv asset purchase, partially offset by a decrease of $87,903 in capitalized software development costs.
Current wording
Net cash used in investing activities during the six months ended August 31, 2025 was $1,752,168, which compares to $389,568 of cash used in investing activities during the same period of 2024, an increase of $1,362,600, or 349.8%. The increase resulted from $900,000 related to the acquisition of FSA, $300,000 related to the Journy.tv asset purchase and $443,168 related to the acquisition of TA Pipeline LLC, partially offset by a decrease of $280,568 in capitalized software development costs.
Previous wording
Net cash provided by financing activities for the three months ended May 31, 2025 was $1,392,700 as compared to $1,024,591 for the same period in 2024. The increase of $368,109, or 36.0%, was due to an increase in advances from related parties of $275,409 and net increase in notes payable to investors of $92,700.
Current wording
Net cash provided by financing activities for the six months ended August 31, 2025 was $2,997,738 as compared to $2,120,317 for the same period in 2024. The increase of $877,421, or 41.4%, was due to an increase in advances from related parties of $654,683 and proceeds from private placements of $396,500, partially offset by a reduction in notes payable of $173,762.
Rearranged current paragraphs (5)
Current report — wording carried from elsewhere
Due to uncertainties regarding our ability to meet our current and future operating and capital expenses, there is substantial doubt about our ability to continue as a going concern for 12 months from the date of filing of this Quarterly Report and the report of our registered independent public accounting firm filed with our Annual Report on Form 10-K for our the fiscal year ended February 28, 2025 contains a going concern qualification.
Current report — wording carried from elsewhere
The net loss from discontinued operations for the three months ended August 31, 2025 was $0 as compared to $1,131 for the same period in 2024.
Current report — wording carried from elsewhere
Our net loss applicable to common stockholders for the three months ended August 31, 2025, was $3,081,418, as compared to $1,545,338 for the same period in 2024, an increase of $1,536,080, or 99%. The increase was primarily attributable to an increase in operating loss from continued operations of $1,733,585 and an increase in preferred dividends of $172,575; partially offset by an increase in other income of $368,949 and a decrease in the loss from discontinued operations of $1,131.
Current report — wording carried from elsewhere
During the six months ended August 31, 2025, we realized net other income of $498,533, as compared to net other expense of $99,452 in the same period in 2024. The increase in net other income of $597,985 was primarily due to a settlement agreement between NextTrip Group, LLC and the Company related to the NextPlay Technologies, Inc. promissory note receivable of $1,123,245, and the August 31, 2025 revaluation of the derivative liability which resulted in a decrease in the liability of $10,000, partially offset by: (a) a loss of $70,100 related to the extinguishment of debt; and (b) interest expense of $402,845 primarily in connection the amortization of the debt discount associated with bridge loans and (c) an increase in interest expense associated with notes payable and other expenses of $62,315.
Current report — wording carried from elsewhere
Preferred dividends for the six months ended August 31, 2025 were $247,725, as compared to $21,376, for the same period in 2024. The increase was due to dividends paid to the holders of shares of Series L and Series M Preferred stock issued in connection with debt conversions in December 2024 and February of 2025.