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Item 1. Financial Statements

2023-10-13 compared with 2023-07-14 · 781 added, 466 removed, 1161 unchanged (52% of the section changed)

2 unchanged sentences

CONSOLIDATED INTERIM FINANCIAL STATEMENTS

the three months ended May 31, 2023

the six months ended August 31, 2023

- Expressed in U.S.

20 unchanged sentences

Non-current Liabilities

Convertible notes payable, non-current portion

Convertible note payable, non-current portion

Lease liability, non-current portion

4 unchanged sentences

Authorized 1,000,000 shares;

issued and outstanding - 0 - shares.

and outstanding - 0 - shares.

Common Stock, par value $ .0001 per share;

Authorized 200,000,000 shares;

issued and outstanding 51,988,030 shares and 49,432,214 issued and outstanding at May 31, 2023 and February 28, 2023 respectively

Authorized 200,000,000

issued and outstanding 52,381,952 shares and 49,432,214 issued and outstanding at August 31, 2023 and February 28, 2023

Additional paid-in capital

4 unchanged sentences

Accumulated other comprehensive income

Stockholders equity before non-controlling interests

Stockholders equity before non-controlling

Non-controlling interests

TOTAL SHAREHOLDERS EQUITY

TOTAL LIABILITIES AND SHAREHOLDERS EQUITY

TOTAL SHAREHOLDERS

TOTAL LIABILITIES

AND SHAREHOLDERS EQUITY

FingerMotion,

1 unchanged sentence

Three Months Ended

Six Months Ended

Cost of revenue

1 unchanged sentence

( 4,565,173 )

( 18,944,174 )

( 9,043,225 )

Amortization & Depreciation

2 unchanged sentences

( 1,275,869 )

( 2,996,346 )

( 2,515,419 )

Marketing Cost

4 unchanged sentences

( 1,911,375 )

( 3,883,889 )

( 3,723,866 )

Net loss from operations

1 unchanged sentence

( 1,379,806 )

( 2,929,011 )

Other income (expense):

6 unchanged sentences

$ ( 1,538,095 )

$ ( 1,398,914 )

$ ( 2,982,763 )

Income tax expenses

1 unchanged sentence

$ ( 1,538,095 )

Net profit attributable to the non-controlling interest

Net loss attributable to the Companys shareholders

$ ( 1,398,914 )

$ ( 2,982,763 )

Net profit (loss) attributable

to the non-controlling interest

Net loss attributable to the Companys

$ ( 134,081 )

$ ( 1,537,365 )

$ ( 1,399,552 )

$ ( 2,981,488 )

Other comprehensive income:

3 unchanged sentences

$ ( 1,761,158 )

comprehensive income (loss) attributable to non-controlling interest

Comprehensive loss attributable to the Company

$ ( 1,923,286 )

$ ( 3,510,651 )

NET LOSS PER SHARE

Comprehensive loss attributable

to non-controlling interest

Comprehensive loss attributable to the

$ ( 1,071,427 )

$ ( 1,760,840 )

$ ( 1,923,042 )

$ ( 3,510,244 )

NET PROFIT (LOSS) PER SHARE

Loss Per Share - Basic

Loss Per Share - Diluted

NET LOSS PER SHARE ATTRIBUTABLE TO THE COMPANY

NET PROFIT (LOSS) PER SHARE ATTRIBUTABLE TO THE COMPANY

Loss Per Share - Basic

2 unchanged sentences

Weighted Average Common Shares Outstanding - Diluted

FingerMotion,

Condensed Consolidated Statement of Shareholders Equity

Paid-in capital

FingerMotion, Inc.

Unaudited Condensed Consolidated

Statement of Shareholders Equity

Comprehensive

1 unchanged sentence

Non-controlling

stock options

Balance at March 1, 2023

at March 1, 2023

( 24,691,314 )

Common stock issued for cash

Common stock issued for professional service

Execution of convertible notes

Accumulated other comprehensive income

stock issued for cash

stock issued for professional service

of convertible notes

other comprehensive income

profit (loss)

( 1,265,471 )

1 unchanged sentence

( 1,264,262 )

Balance at May 31, 2023

at May 31, 2023

( 25,956,785 )

Paid-in capital

stock issued for cash

stock issued for professional service

exercise of warrants

paid-in capital – stock options

other comprehensive income

at August 31, 2023

( 26,090,866 )

Comprehensive

1 unchanged sentence

Non-controlling

stock options

Balance at March 1, 2022

at March 1, 2022

( 17,152,172 )

Common stock issued for cash

Common stock issued for professional service

Accumulated other comprehensive income

stock issued for cash

stock issued for professional service

other comprehensive income

( 1,444,123 )

1 unchanged sentence

( 1,444,668 )

Balance at May 31, 2022

at May 31, 2022

( 18,596,295 )

stock issued for cash

stock issued for professional service

other comprehensive income

( 1,537,365 )

( 1,538,095 )

at August 31, 2022

( 20,133,660 )

FingerMotion,

Condensed Consolidated Statements of Cash Flows

Three Months Ended

Six Months Ended

$ ( 1,398,914 )

$ ( 2,982,763 )

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Adjustments to reconcile net loss to net

cash provided by (used in) operating activities:

Share based compensation expenses

Amortization and depreciation

Impairment of fixed assets

Change in operating assets and liabilities:

(Increase) decrease in accounts receivable

( 7,292,931 )

(Increase) decrease in prepayment and deposit

1 unchanged sentence

( 2,067,397 )

(Increase) decrease in inventories

Increase (decrease) in accounts payable

2 unchanged sentences

Increase (decrease) in due to lease liability

Net Cash provided by (used in) operating activities

Net Cash provided by (used in) operating

( 4,874,162 )

( 3,785,843 )

Cash flows from investing activities

Purchase of equipment

Net cash provided by (used in) investing activities

Net cash provided by (used in) investing

Cash flows from financing activities

3 unchanged sentences

Common stock issued for cash

Net cash provided by (used in) financing activities

( 1,075,333 )

Net cash provided by (used in) financing

Effect of exchange rates on cash and cash equivalents

8 unchanged sentences

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

38 unchanged sentences

a Loan Agreement, a Power of Attorney Agreement, a Call Option Agreement, and a Share Pledge Agreement in order to secure the connection

and commitments of the JiuGe Technology.

and commitments of JiuGe Technology.

March 7, 2019, JiuGe Technology also acquired 99% of the equity interest of Beijing XunLian (BX), a subsidiary that provides

bulk distribution of SMS messages for JiuGe customers at discounted rates.

bulk distribution of SMS messages for JiuGe Technology customers at discounted rates.

Motion Financial Company Limited was incorporated on January 24, 2020 and is 100% owned by FingerMotion, Inc.

The company has been activated

for the insurtech business during the last quarter of the fiscal year where the Big Data division secured its first contract and recorded

for the insurtech business during the last quarter of the fiscal year 2021 where the Big Data division secured its first contract and

recorded revenue.

TengLian JiuJiu Information Communication Technology Co., Ltd.

2 unchanged sentences

It is 99% owned by JiuGe Technology.

February 5, 2021, JiuGe Technology has disposed of its 99% owned subsidiary, Suzhou BuGuNiao Digital Technology Co., Ltd which was established

February 5, 2021, JiuGe Technology disposed of its 99% owned subsidiary, Suzhou BuGuNiao Digital Technology Co., Ltd., which was established

to venture into R&D projects.

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

31 unchanged sentences

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

1 unchanged sentence

following assets and liabilities of the VIE and VIEs subsidiaries are included in the accompanying condensed consolidated financial

statements of the Company as of May 31, 2023 and February 28, 2023:

statements of the Company as of August 31, 2023 and February 28, 2023:

and liabilities of the VIE

Schedule of variable interest entity

August 31, 2023

February 28, 2023

5 unchanged sentences

and liabilities of the VIE Subsidiary

August 31, 2023

February 28, 2023

2 unchanged sentences

Current liabilities

$ ( 290,974 )

Non-current liabilities

Total liabilities

$ ( 290,974 )

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

1 unchanged sentence

Result of VIE

For the Three Months Ended

For the Six Months Ended

Cost of revenue

3 unchanged sentences

General and administrative expenses

( 1,128,927 )

( 1,154,029 )

Marketing cost

3 unchanged sentences

$ ( 1,560,814 )

Loss from operations

$ ( 285,669 )

Net profit (loss) from operations

$ ( 978,528 )

3 unchanged sentences

$ ( 927,267 )

$ ( 457,394 )

Result of VIE Subsidiary

For the Three Months Ended

For the Six Months Ended

Cost of revenue

7 unchanged sentences

$ ( 234,660 )

Loss from operations

$ ( 277,608 )

Net profit (loss) from operations

$ ( 127,540 )

Interest income

1 unchanged sentence

Net profit (loss)

$ ( 127,470 )

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

46 unchanged sentences

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

34 unchanged sentences

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

44 unchanged sentences

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

2 unchanged sentences

contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business.

had an accumulated deficit of $ 25,956,785 and $ 24,691,314 as at May 31, 2023 and February 28, 2023 respectively, and had a net loss of

$ 1,264,262 and $ 1,444,668 for the three months ended May 31, 2023 and 2022, respectively.

had an accumulated deficit of $ 26,090,866 and $ 24,691,314 as at August 31, 2023 and February 28, 2023 respectively, and had a net loss

of $ 1,398,914 and $ 2,982,763 for the six months ended August 31, 2023 and 2022, respectively.

Companys continuation as a going concern is dependent on its ability to obtain additional financing to fund operations, implement

8 unchanged sentences

long-term liquidity also depends upon its ability to generate revenues and achieve profitability.

recorded $ 12,169,091 and $ 4,855,123 in revenue, respectively, for the three months ended May 31, 2023 and 2022.

recorded $ 21,448,257 and $ 9,838,080 in revenue, respectively, for the six months ended August 31, 2023 and 2022.

Schedule of revenue

For the three months ended

For the six months ended

August 31, 2023

August 31, 2022

Telecommunication Products & Services

1 unchanged sentence

5 – Equipment

May 31, 2023 and February 28, 2023, the company has the following amounts related to tangible assets:

August 31, 2023 and February 28, 2023, the company has the following amounts related to tangible assets:

Schedule of property, plant and equipment

August 31, 2023

February 28, 2023

2 unchanged sentences

significant residual value is estimated for the equipment.

Depreciation expense for the three months ended May 31, 2023 and 2022 totaled

Depreciation expense for the six months ended August 31, 2023 and 2022 totalled

$ 15,616 and $ 5,878 , respectively.

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

6 – Intangible Assets

May 31, 2023 and February 28, 2023, the company has the following amounts related to intangible assets:

August 31, 2023 and February 28, 2023, the company has the following amounts related to intangible assets:

Schedule of intangible assets

August 31, 2023

February 28, 2023

4 unchanged sentences

significant residual value is estimated for these intangible assets.

Amortization expense for the three months ended May 31, 2023 and

2022 totaled $ 10,399 and $ 11,093 , respectively.

Amortization expense for the six months ended August 31, 2023 and

2022 totalled $ 20,397 and $ 21,760 , respectively.

7 – Prepayment and Deposit

6 unchanged sentences

Schedule of prepaid expense

August 31, 2023

February 28, 2023

5 unchanged sentences

Prepayment and deposit

August 31, 2023

February 28, 2023

6 unchanged sentences

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

8 – Other Receivables

May 31, 2023 and February 28, 2023, the company has the following amounts related to other receivables:

August 31, 2023 and February 28, 2023, the company has the following amounts related to other receivables:

Schedule of other receivables

August 31, 2023

February 28, 2023

2 unchanged sentences

In-transit capital injection for a subsidiary

Loan for capital injection for a subsidiary

Other receivables

9 – Right-of-use Asset and Lease Liability

10 unchanged sentences

Balance Sheet.

All operating lease expense is recognized on a straight-line basis over the lease term in the three months ended May 31,

All operating lease expense is recognized on a straight-line basis over the lease term in the six months ended August

related to the Companys right-of-use assets and related lease liabilities were as follows:

Schedule of operating leases assets and liabilities

August 31, 2023

February 28, 2023

5 unchanged sentences

Total lease liability

Remaining lease term and discount rate

Remaining lease term and

discount rate

August 31, 2023

Weighted-average remaining lease term

Weighted-average discount rate

following table summarizes the future minimum lease payments due under the Companys operating leases as of May 31, 2023:

following table summarizes the future minimum lease payments due under the Companys operating leases as of August 31, 2023:

Schedule of future minimum lease payments due

imputed interest

Total lease liability

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

10 - Convertible Note Payable

Note Payable having a Face Value of $ 730,000 at May 1, 2022 and accruing interest at 20 % is due on April 30, 2023.

The note is convertible

Note Payable having a Face Value of $ 730,000 at May 1, 2022 and accruing interest at 20 % was due on April 30, 2023.

The note was convertible

anytime from the date of issuance into $ 0.0001 par value Common Stock at $ 4.00 per share.

April 28, 2023, the Company paid the Note Payable of $ 730,000 .

April 28, 2023, the Company repaid the Note Payable of $ 730,000 .

secured, two-year, interest-free convertible promissory note with a principal amount of $ 4,800,000 was issued on August 9, 2022 representing

a funded amount of $4,000,000 and a coupon of 20% (the Note).

The principal amount is payable commencing 180 days after

The principal amount was payable commencing 180 days after

the issuance in 18 consecutive monthly payments, at the option of the Company, to be made in either cash, shares of common stock of the

6 unchanged sentences

share for gross proceeds of $ 11,550,000 (the Private Placement Proceeds).

2.2 of the Note provides for the remedies upon an event of default, which as described in the Note, the holder may at any time at its

2.2 of the Note provided for the remedies upon an event of default, which as described in the Note, the holder may at any time at its

option declare the Note immediately due and payable at an amount of 110% or 120% of the outstanding principal amount (the Mandatory

2 unchanged sentences

periods, the holder may (a) from time-to-time demand that all or a portion of the outstanding principal amount be converted into shares

of our common stock at the lower of (i) the conversion price (currently $2.00 per share) and (ii) 80% of the average of the three (3)

lowest daily VWAPs during the twenty (20) days prior to the delivery of the conversion notice, or (b) exercise or otherwise enforce any

one or more of the holders rights, powers, privileges, remedies and interests under the Note, the Purchase Agreement, the other

transaction documents or applicable law.

of our common stock at the lower of (i) the conversion price ($2.00 per share) and (ii) 80% of the average of the three (3) lowest daily

VWAPs during the twenty (20) days prior to the delivery of the conversion notice, or (b) exercise or otherwise enforce any one or more

of the holders rights, powers, privileges, remedies and interests under the Note, the Purchase Agreement, the other transaction

documents or applicable law.

Mandatory Default Amount for an event of default under Section 2.1(e) of the Note is 110% of the outstanding principal amount of the

7 unchanged sentences

On or about April

6, 2023, the Company paid the full outstanding balance of the Note which also includes the 10% Mandatory Default Amount.

6, 2023, the Company paid the full outstanding balance of the Note which also included the 10% Mandatory Default Amount.

addition, section 5.7 of the Purchase Agreement provides that if we issued any equity interests, other than Exempted Securities

2 unchanged sentences

25% of such proceeds from such issuance to repay the Note.

We have advised the holder that the aggregate Private Placement

Proceeds exceeds $10,000,000 and the holder does not seek to waive or require payment of 25% of the proceeds as repayment of the Note.

We have advised the holder that the aggregate Private Placement Proceeds

exceeded $10,000,000 and the holder did not seek to waive or require payment of 25% of the proceeds as repayment of the Note.

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

33 unchanged sentences

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

24 unchanged sentences

a consulting agreement.

January 19, 2023 , the Company issued an aggregate of 25,000 shares of our common stock at

a deemed price of $2.85 per share to two individuals and one entity pursuant to consulting agreements.

January 19, 2023, the Company issued an aggregate of 25,000 shares of our common stock at a deemed price of $ 2.85 per share to two individuals

and one entity pursuant to consulting agreements.

January 19, 2023, the Company issued 125,000 shares of our common stock at a deemed price of $ 1.44 per share to one entity pursuant to

4 unchanged sentences

a consulting agreement.

February 7, 2023, the Company issued 1,721,766 shares of common stock at deemed price of $1.75

per share to its primary lender pursuant to the cashless exercise of warrants of the convertible promissory note (the Note)

issued to the Companys primary lender on August 9, 2022.

February 7, 2023, the Company issued 1,721,766 shares of common stock at deemed price of $ 1.75 per share to its primary lender pursuant

to the cashless exercise of warrants of the convertible promissory note (the Note) issued to the Companys primary

lender on August 9, 2022.

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

2 unchanged sentences

a consulting agreement.

February 15, 2023, the Company issued 500,000 shares of common stock at price of $2.00

per share to its primary lender pursuant to the conversion of $ 1,000,000 of principal amount of the convertible promissory note (the

Note) issued to the Companys primary lender on August 9, 2022.

February 22, 2023, the Company issued 500,000 shares of common stock at price of $ 2.00 per

share to its primary lender pursuant to the conversion of $ 1,000,000 of principal amount of the convertible promissory note (the Note)

issued to the Companys primary lender on August 9, 2022

February 15, 2023, the Company issued 500,000

shares of common stock at price of $ 2.00

per share to its primary lender pursuant to the conversion of $ 1,000,000

of principal amount of the convertible promissory note (the Note) issued to the Companys primary lender on August

February 22, 2023, the Company issued 500,000 shares of common stock at price of $ 2.00 per share to its primary lender pursuant to the

conversion of $ 1,000,000 of principal amount of the convertible promissory note (the Note) issued to the Companys

primary lender on August 9, 2022

February 28, 2023, the Company issued 150,000 shares of our common stock at a deemed price of $ 0.74 per share to one individual pursuant

to a consulting agreement.

February 28, 2023, the Company issued 7,500 shares of our common stock at a deemed price of $2.47 per share to one entity pursuant

to a consulting agreement.

March 17, 2023, we issued 2,465,816 shares of common stock at price of $ 0.863 per share to our primary lender pursuant to the conversion

of $ 2,128,000 of principal amount of the Note issued to our primary lender on August 9, 2022.

April 18, 2023, we issued 20,000 shares of common stock at a price of $ 3.00 per share pursuant to the exercise of warrants.

April 24, 2023, we issued 70,000 shares of our common stock at a deemed price of $ 1.64 per share to one entity pursuant to a consulting

of May 31, 2023 there were 51,988,030 shares of the Companys common stock issued and outstanding, and none of the preferred shares

were issued and outstanding.

February 28, 2023, the Company issued 7,500 shares of our common stock at a deemed price of $ 2.47 per share to one entity pursuant to

a consulting agreement.

March 17, 2023, the Company issued 2,465,816 shares of common stock at price of $ 0.863 per share to our primary lender pursuant to the

conversion of $ 2,128,000 of principal amount of the Note issued to our primary lender on August 9, 2022.

April 18, 2023, the Company issued 20,000 shares of common stock at a price of $ 3.00 per share pursuant to the exercise of warrants.

April 24, 2023, the Company issued 70,000 shares of our common stock at a deemed price of $ 1.64 per share to one entity pursuant to a

consulting agreement.

July 17, 2023, the Company issued 121,422 shares of our common stock at a deemed price of $ 1.75 per share to The Benchmark Company, LLC

(Benchmark) pursuant to the cashless exercise of warrants.

August 3, 2023, the Company issued 260,000 shares of our common stock at a price of $ 3.00 per share to three individuals pursuant to

the exercise of warrants.

August 3, 2023, the Company issued 12,500 shares of our common stock at a deemed price of $ 2.47 per share to one entity pursuant to a

consulting agreement.

of August 31, 2023 there were 52,381,952 shares of the Companys common stock issued and outstanding, and none of the preferred

shares were issued and outstanding.

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

Purchase Warrants

continuity schedule of outstanding share purchase warrants as at May 31, 2023, and the changes during the periods, is as follows:

continuity schedule of outstanding share purchase warrants as at August 31, 2023, and the changes during the periods, is as follows:

Schedule of outstanding share purchase warrants

15 unchanged sentences

Balance, February 28, 2023

Balance, May 31, 2023

Fiscal 2023 and Fiscal 2022, we received cash proceeds totaling $ 470,000 and $ 539,998 , respectively, from the exercise of stock purchase

( 1,137,668 )

Cashless Exercised

Balance, August 31, 2023

Fiscal 2023 and Fiscal 2022, we received cash proceeds totalling $ 470,000 and $ 539,998 , respectively, from the exercise of stock purchase

August 9, 2022, the Company entered into a Securities Purchase Agreement with an investor (the Investor), pursuant to which

11 unchanged sentences

of $ 5.00 per share until September 19, 2024 to one individual pursuant to a consulting agreement.

November 29, 2022, the Company issued 168,000 common stock purchase warrants to purchase 168,000 shares of its common stock at a price

of $1.75 per share until August 9, 2027 to The Benchmark Company, LLC (Benchmark) pursuant to a financial advisory agreement.

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

Purchase Warrants (continued)

November 29, 2022, the Company issued 28,312 common stock purchase warrants to purchase 28,312

shares of its common stock at a price of $8.22 per share until November 4, 2025, to Benchmark pursuant to a financial advisory agreement.

November 29, 2022, the Company issued 10,000 common stock purchase warrants to purchase 10,000

shares of its common stock at a price of $6.70 per share until November 21, 2025, to Benchmark pursuant to a financial advisory agreement.

November 29, 2022, the Company issued 168,000 common stock purchase warrants to purchase 168,000 shares of its common stock at a price

of $ 1.75 per share until August 9, 2027 to Benchmark pursuant to a financial advisory agreement.

November 29, 2022, the Company issued 28,312 common stock purchase warrants to purchase 28,312 shares of its common stock at a price

of $ 8.22 per share until November 4, 2025 , to Benchmark pursuant to a financial advisory agreement.

November 29, 2022, the Company issued 10,000 common stock purchase warrants to purchase 10,000 shares of its common stock at a price

of $ 6.70 per share until November 21, 2025 , to Benchmark pursuant to a financial advisory agreement.

the quarter ended November 30, 2022, the Company received $ 470,000 from the exercise of warrants for the purchase of 100,000 shares of

5 unchanged sentences

The new expiry date of the January 2021 Warrants is July 13, 2023 .

February 28, 2023, the Company issued 125,000 common

stock purchase warrants to purchase 125,000 shares of its common stock at a price of $ 5.00 per share until October 1, 2024 to one entity

pursuant to a consulting agreement.

April 18, 2023 , the Company received $ 60,000 from the

exercise of warrants for the purchase of 20,000 shares of common stock of the Company at a price of $ 3.00 per share from 1 individual.

April 19, 2023, 188,500 stock purchase warrants at an exercise price of $ 2.00 per share have expired.

summary of share purchase warrants outstanding and exercisable as at May 31, 2023 is as follows:

February 28, 2023, the Company issued 125,000 common stock purchase warrants to purchase 125,000 shares of its common stock at a price

of $ 5.00 per share until October 1, 2024 to one entity pursuant to a consulting agreement.

April 18, 2023, the Company received $ 60,000 from the exercise of warrants for the purchase of 20,000 shares of common stock of the Company

at a price of $ 3.00 per share from 1 individual.

April 19, 2023, 188,500 stock purchase warrants having an exercise price of $ 2.00 per share expired.

July 13, 2023, the Company received $ 780,000 from the exercise of warrants for the purchase of 260,000 shares of common stock of the

Company at a price of $ 3.00 per share from three individuals.

July 13, 2023, 1,137,668 stock purchase warrants having an exercise price of $ 3.00 per share expired.

July 17, 2023, Benchmark exercised 168,000 warrants on the cashless exercise basis resulting in the issuance of 121,422 shares of common

summary of share purchase warrants outstanding and exercisable as at August 31, 2023 is as follows:

Schedule of share purchase warrants outstanding and exercisable

3 unchanged sentences

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

December 28, 2021, we granted an aggregate of 4,545,000 stock options pursuant to our 2021 Stock Incentive Plan having an exercise

price of $8.00 per share and an expiry date of five years from the date of grant to 40 individuals who were directors, officers, employees

and consultants of the Company.

December 28, 2021, the Company granted an aggregate of 4,545,000 stock options pursuant to the Companys 2021 Stock Incentive Plan

having an exercise price of $ 8.00 per share and an expiry date of five years from the date of grant to 40 individuals who were directors,

officers, employees and consultants of the Company.

We relied upon the exemption from registration under the U.S.

Securities Act provided by Rule 903 of

Regulation S promulgated under the U.S.

Securities Act provided

by Rule 903 of Regulation S promulgated under the U.S.

Securities Act for the grant of stock options to individuals who are non-U.S.

persons and upon

the exemption from registration under Section 4(a)(2) of the U.S.

persons and upon the exemption from registration under Section 4(a)(2) of the U.S.

Securities Act for two individuals who are U.S.

options are all subject to vesting provisions of 20% on the date of grant and 20% on each of the first, second, third, and fourth anniversary

of the date of grant.

At our annual meeting of stockholders held on February 17, 2023, the stockholder approved an amendment to the exercise

price of the outstanding stock options from $8.00 to $3.84.

The stock options are all subject to vesting provisions of 20% on the date of grant and 20% on each of the first, second, third, and

fourth anniversary of the date of grant.

At our annual meeting of stockholders held on February 17, 2023, the stockholder approved an

amendment to the exercise price of the outstanding stock options from $8.00 to $3.84.

fair value of these stock options was estimated at the date of grant, using the Black-Scholes Option Valuation Model, with the following

1 unchanged sentence

Schedule of valuation assumptions

February 28, 2023

Expected Risk-Free Interest Rate

3 unchanged sentences

Weighted-Average Grant Date Fair Value

continuity schedule of outstanding stock options as at May 31, 2023, and the changes during the three months periods, is as follows:

July 28, 2023, the Company granted an aggregate of 2,648,500 stock options pursuant to the Companys 2023 Stock Incentive Plan

having an exercise price of $ 4.62 per share and an expiry date of five years from the date of grant to 22 individuals who were employees

and consultants of the Companys subsidiaries and contractually controlled affiliate.

The stock options are all subject to vesting

provisions of 20% on the date of grant and 20% on each of the first, second, third and fourth anniversary of the date of grant.

fair value of these stock options was estimated at the date of grant, using the Black-Scholes Option Valuation Model, with the following

weighted average assumptions:

Schedule of valuation assumptions

Expected Risk-Free Interest Rate

Expected Volatility

Expected Life in Years

Expected Dividend Yield

Weighted-Average Grant Date Fair Value

continuity schedule of outstanding stock options as at August 31, 2023, and the changes during the six months periods, is as follows:

Schedule of stock option activity

4 unchanged sentences

Balance, May 31, 2023

table below sets forth the number of issued shares and cash received upon exercise of stock options:

Schedule of number of issued shares and cash received upon exercise of stock options

of Options Exercised on Forfeiture Basis

of Options Exercised on Cash Basis

Number of Options Exercised

of Shares Issued on Cash Exercise

of Shares Issued on Forfeiture Basis

Number of Shares Issued Upon Exercise of Options

Received from Exercise of Stock Options

Intrinsic Value of Options Exercised

Stock Options Grant - July 28, 2023

Vested – July 28, 2023

Balance, August 31, 2023

FINGERMOTION,

months ended May 31, 2023 and 2022

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

Options (continued)

continuity schedule of outstanding unvested stock options at May 31, 2023, and the changes during the three months periods, is as follows

table below sets forth the number of issued shares and cash received upon exercise of stock options:

Schedule of number of issued shares and cash received upon exercise of stock options

Number of Options Exercised on Forfeiture Basis

Number of Options Exercised on Cash Basis

Total Number of Options Exercised

Number of Shares Issued on Cash Exercise

Number of Shares Issued on Forfeiture Basis

Total Number of Shares Issued Upon Exercise of Options

Cash Received from Exercise of Stock Options

Total Intrinsic Value of Options Exercised

continuity schedule of outstanding unvested stock options at August 31, 2023, and the changes during the six months periods, is as follows

Schedule of unvested restricted stock

1 unchanged sentence

February 28, 2023

February 28, 2022

February 28, 2023

at May 31, 2023, the aggregate intrinsic value of all outstanding stock options granted was estimated at $0 as the current price is lower

than the strike price.

summary of stock options outstanding and exercisable as at May 31, 2023 is as follows:

Options Grant - July 28, 2023

– July 28, 2023

August 31, 2023

at August 31, 2023, the aggregate intrinsic value of all outstanding stock options granted was estimated at $ 6,080,331 as the current

price as of August 31, 2023 is $ 5.11 .

summary of stock options outstanding and exercisable as at August 31, 2023 is as follows:

Schedule of stock options

Options Outstanding

Options Exercisable

Exercise Price

Average Remaining

at May 31, 2023

Exercisable at August 31, 2023

Exercise Price

Average Remaining

$ 7.00 to $ 9.00

$ 4.00 to $ 5.00

FINGERMOTION,

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

12 - Earnings Per Share

1 unchanged sentence

Schedule of basic and diluted earnings per common share

For the three months ended

For the six months ended

August 31, 2023

August 31, 2022

Numerator - basic and diluted

1 unchanged sentence

$ ( 2,982,763 )

Weighted average number of common shares outstanding — basic

Weighted average number of common shares outstanding — diluted

Weighted average number of common shares outstanding

Loss per common share — basic

Loss per common share — diluted

FINGERMOTION,

months ended May 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

13 - Income Taxes

6 unchanged sentences

The Company generated

a taxable loss for the three months ended May 31, 2023 and 2022.

a taxable loss for the six months ended August 31, 2023 and 2022.

Motion Company Limited is incorporated in Hong Kong and Hong Kongs profits tax rate is 16.5 % .

Finger Motion Company Limited did

not earn any income that was derived in Hong Kong for the three months ended May 31, 2023 and 2022.

not earn any income that was derived in Hong Kong for the six months ended August 31, 2023 and 2022.

Peoples Republic of China (PRC)

1 unchanged sentence

and subject to PRC income tax at 25 % .

FINGERMOTION,

months ended August 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

13 - Income Taxes (continued)

tax mainly consists of foreign income tax at statutory rates and the effects of permanent and temporary differences.

The Companys

effective income tax rates for the three months ended May 31, 2023 and 2022 are as follows:

effective income tax rates for the six months ended August 31, 2023 and 2022 are as follows:

Schedule of effective income tax rate reconciliation

For the three months ended

For the six months ended

August 31, 2023

August 31, 2022

statutory tax rate

3 unchanged sentences

Effective tax rate

May 31, 2023 and February 28, 2023, the Company has a deferred tax asset of $ 316,368 and $ 1,884,786 , resulting from certain net operating

August 31, 2023 and February 28, 2023, the Company has a deferred tax asset of $ 349,888 and $ 1,884,786 , resulting from certain net operating

losses in U.S., respectively.

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portion or all of the valuation allowance.

At May 31, 2023 and February 28, 2023, the valuation allowance was $ 316,368 and $ 1,884,786 ,

At August 31, 2023 and February 28, 2023, the valuation allowance was $ 349,888 and $ 1,884,786 ,

respectively.

Schedule of deferred tax assets and liabilities

August 31, 2023

February 28, 2023

3 unchanged sentences

Deferred tax asset, net

FINGERMOTION,

months ended May 31, 2023 and 2022

to the Condensed Consolidated Financial Statements

14 - Commitments and Contingencies

1 unchanged sentence

15 - Subsequent Events

for the above, the Company has determined that it does not have any material subsequent events to disclose in these consolidated financial

September 5, 2023, the Company issued 2,500 shares of our common stock at a deemed price of $ 2.47 per share to one entity pursuant to

a consulting agreement and issued 70,000 shares of our common stock at a deemed price of $ 1.64 per share to one entity pursuant to a

consulting agreement.

September 14, 2023, two officers of the Company exercised an aggregate of 180,400 stock options on a deemed net-stock exercise basis

resulting in the issuance of an aggregate of 90,898 shares of our common stock and the forfeiture of 89,502 stock options to the Company.

2 – MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

8 unchanged sentences

uncertainties and assumptions set forth in reports and other documents we have filed with or furnished to the SEC and, including, without

limitation, this Quarterly Report on Form 10-Q for the three months ended May 31, 2023, and our Annual Report on Form 10-K for the fiscal

limitation, this Quarterly Report on Form 10-Q for the six months ended August 31, 2023, and our Annual Report on Form 10-K for the fiscal

year ended February 28, 2023, including the consolidated financial statements and related notes contained therein.

4 unchanged sentences

10-K for the fiscal year ended February 28, 2023, and Item 1A, Risk Factors, under Part II - Other Information of this Quarterly Report.

MD&A is focused on material changes in our financial condition from February 28, 2023, our most recently completed year end, to May

31, 2023, and our results of operations for the three months ended May 31, 2023, and should be read in conjunction with Item 7, Managements

Discussion and Analysis of Financial Condition and Results of Operations as contained in our Annual Report on Form 10-K for the fiscal

year ended February 28, 2023.

MD&A is focused on material changes in our financial condition from February 28, 2023, our most recently completed year end, to August

31, 2023, and our results of operations for the three and six months ended August 31, 2023, and should be read in conjunction with Item

7, Managements Discussion and Analysis of Financial Condition and Results of Operations as contained in our Annual Report on Form

10-K for the fiscal year ended February 28, 2023.

Company was initially incorporated as Property Management Corporation of America on January 23, 2014 in the State of Delaware.

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following diagram depicts our corporate structure:

holding company structure presents unique risks as our investors may never directly hold equity interests in our subsidiaries or the

VIE, and will be dependent upon contributions from our subsidiaries and the VIE to finance our cash flow needs.

Our subsidiaries and

the VIE are currently not required to obtain permission from the Chinese authorities including the China Securities Regulatory Commission

(the CSRC ), or Cybersecurity Administration Committee (the CAC ), to operate or to issue securities

to foreign investors.

However, as of March 31, 2023, pursuant to the Overseas Listing Trial Measures promulgated by the CSRC, we may

have to file with the CSRC with respect to a new offering of our securities.

The business of our subsidiaries and the VIE until now are

not subject to cybersecurity review with the CAC, given that:

(i) data processed in our business does not have a bearing on national

security and thus may not be classified as core or important data by the authorities;

(ii) we do not possess a large amount of personal

information in our business operations.

In addition, we are not subject to merger control review by Chinas anti-monopoly enforcement

agency due to the level of our revenues which provided from us and audited by our auditor and the fact that we currently do not expect

to propose or implement any acquisition of control of, or decisive influence over, any company with revenues within China of more than

RMB400 million.

Currently, these statements and regulatory actions have had no impact on our daily business operations, the ability to

accept foreign investments and list our securities on an U.S.

Our holding company structure presents unique

risks as our investors may never directly hold equity interests in our subsidiaries or the VIE, and will be dependent upon contributions

from our subsidiaries and the VIE to finance our cash flow needs.

Our subsidiaries and the VIE are currently not required to obtain permission

from the Chinese authorities including the China Securities Regulatory Commission (the CSRC ), or Cybersecurity Administration

Committee (the CAC ), to operate or to issue securities to foreign investors.

However, as of March 31, 2023, pursuant

to the Overseas Listing Trial Measures promulgated by the CSRC, we may have to file with the CSRC with respect to a new offering of our

The business of our subsidiaries and the VIE until now are not subject to cybersecurity review with the CAC, given that:

(i) data processed in our business does not have a bearing on national security and thus may not be classified as core or important data

by the authorities;

(ii) we do not possess a large amount of personal information in our business operations.

In addition, we are not

subject to merger control review by Chinas anti-monopoly enforcement agency due to the level of our revenues which provided from

us and audited by our auditor and the fact that we currently do not expect to propose or implement any acquisition of control of, or

decisive influence over, any company with revenues within China of more than RMB400 million.

Currently, these statements and regulatory

actions have had no impact on our daily business operations, the ability to accept foreign investments and list our securities on an

or other foreign exchange.

However, since these statements and regulatory

actions, including the Overseas Listing Trial Measures, are new, it is uncertain what potential impact such modified or new laws and

regulations will have on our daily business operation, the ability to accept foreign investments and list our securities on an U.S.

other foreign exchange.

operate, the VIE and Beijing XunLian TianXia Technology Co., Ltd.

are required to obtain, and have obtained, a value-added telecommunications

business licence from PRC authorities.

In connection with our previous issuance of securities to foreign investors, under current PRC

laws, regulations and regulatory rules, as of the date of this periodic report on Form 10-Q, we, our PRC subsidiaries and the VIE, (i)

are not required to obtain permissions from the CSRC except that as of March 31, 2023 we may have to file with the CSRC with respect

to a new offering of our securities, (ii) are not required to go through cybersecurity review by the CAC, and (iii) have received or

were not denied such requisite permissions by any PRC authority.

If we, our subsidiaries or the VIE (i) do not receive or maintain such

permissions or approvals, (ii) inadvertently conclude that such permissions or approvals are not required or (iii) applicable laws, regulations,

or interpretations change and we are required to obtain such permissions or approvals in the future, we may be subject to government

enforcement actions, investigations, penalties, sanctions and fines imposed by the CSRC, the CAC and relevant departments of the State

In severe circumstances, the business of our PRC subsidiary may be ordered to suspend and its business qualifications and licences

may be revoked.

address challenges resulting from laws, policies and practices that may disfavor foreign-owned entities that operate within industries

deemed sensitive by the Chinese government, we use the VIE structure to provide contractual exposure to foreign investment in the PRC-based

We own 100% of the equity of a WFOE, Shanghai JiuGe Business Management Co., Ltd.

( JiuGe Management ),

which has entered into the VIE Agreements with the VIE, which is owned by Ms.

Li Li the legal representative and general manager, and

also the shareholder of the VIE.

The VIE Agreements have not been tested in court.

As a result of our use of the VIE structure, you may

never directly hold equity interests the VIE.

Any securities that we offer will be securities of the Company, the Delaware holding company,

not of the VIE.

fund the registered capital and operating expenses of the VIE by extending loans to the shareholders of the VIE.

The VIE Agreements governing

the relationship between the VIE and our WFOE enable us to (i) direct the activities of the VIE that most significantly impact the VIEs

economic performance, (ii) receive substantially all of the economic benefits of the VIE, and (iii) have an exclusive call option to

purchase, at any time, all or part of the equity interests in and/or assets of the VIE to the extent permitted by Chinese laws.

result of the VIE Agreements, the Company is considered the primary beneficiary of the VIE for accounting purposes and is able to consolidate

the financial results of the VIE in its consolidated financial statements in accordance with U.S.

a result, investors in our Common Shares are not purchasing an equity interest in the VIE but instead are purchasing equity interest

in FingerMotion, Inc., a Delaware holding company.

Exchange Agreement

July 13, 2017, the Company entered into that certain Share Exchange Agreement (the Share Exchange Agreement ) by

and among the Company, Finger Motion Company Limited, a Hong Kong corporation ( FMCL ) and certain shareholders of

FMCL (the FMCL Shareholders ).

FMCL, a Hong Kong corporation, was formed on April 6, 2016 and is an information technology

company that specializes in operating and publishing mobile games.

Pursuant to the Share Exchange Agreement, the Company agreed to exchange

the outstanding equity stock of FMCL held by the FMCL Shareholders for shares of common stock of the Company.

On the closing date of

the Share Exchange Agreement, the Company issued 12,000,000 shares of common stock to the FMCL shareholders.

In addition, the Company

issued 600,000 shares to consultants in connection with the transactions contemplated by the Share Exchange Agreement, and 2,562,500

additional shares to accredited investors, which was a concurrent financing but not a condition of closing the Share Exchange Agreement.

a result of the Share Exchange Agreement and the other transactions contemplated thereunder, FMCL became a wholly owned subsidiary of

The Company operates its video game division through FMCL.

However, in June 2018, the Company decided to pause the operation

of the game division as it saw the opportunity in the telecommunication business and have since refocused into this business.

description of the Share Exchange Agreement does not purport to be complete and is qualified in its entirety by reference to the terms

of the Share Exchange Agreement, which was filed as an exhibit to our Current Report on Form 8-K filed with the SEC on July 20, 2017

and incorporated by reference herein.

October 16, 2018, the Company, through its indirect wholly owned subsidiary, Shanghai JiuGe Business Management Co., Ltd.

Management ), entered into a series of agreements known as variable interest agreements (the VIE Agreements )

pursuant to which Shanghai JiuGe Information Technology Co., Ltd.

( JiuGe Technology ) became our contractually controlled

The use of VIE agreements is a common structure used to acquire PRC corporations, particularly in certain industries in which

foreign investment is restricted or forbidden by the PRC government.

The VIE Agreements include a Consulting Services Agreement, a Loan

Agreement, a Power of Attorney Agreement, a Call Option Agreement, and a Share Pledge Agreement in order to secure the connection and

commitments of the JiuGe Technology.

However, since these statements and regulatory actions, including the Overseas Listing Trial Measures,

are new, it is uncertain what potential impact such modified or new laws and regulations will have on our daily business operation, the

ability to accept foreign investments and list our securities on an U.S.

or other foreign exchange.

To operate, the VIE and Beijing XunLian TianXia

Technology Co., Ltd.

are required to obtain, and have obtained, a value-added telecommunications business licence from PRC authorities.

In connection with our previous issuance of securities to foreign investors, under current PRC laws, regulations and regulatory rules,

as of the date of this periodic report on Form 10-Q, we, our PRC subsidiaries and the VIE, (i) are not required to obtain permissions

from the CSRC except that as of March 31, 2023 we may have to file with the CSRC with respect to a new offering of our securities, (ii)

are not required to go through cybersecurity review by the CAC, and (iii) have received or were not denied such requisite permissions

by any PRC authority.

If we, our subsidiaries or the VIE (i) do not receive or maintain such permissions or approvals, (ii) inadvertently

conclude that such permissions or approvals are not required or (iii) applicable laws, regulations, or interpretations change and we

are required to obtain such permissions or approvals in the future, we may be subject to government enforcement actions, investigations,

penalties, sanctions and fines imposed by the CSRC, the CAC and relevant departments of the State Council.

In severe circumstances, the

business of our PRC subsidiary may be ordered to suspend and its business qualifications and licences may be revoked.

To address challenges resulting from laws, policies

and practices that may disfavours foreign-owned entities that operate within industries deemed sensitive by the Chinese government, we

use the VIE structure to provide contractual exposure to foreign investment in the PRC-based companies.

We own 100% of the equity of

a WFOE, Shanghai JiuGe Business Management Co., Ltd.

( JiuGe Management ), which has entered into the VIE Agreements

with the VIE, which is owned by Ms.

Li Li the legal representative and general manager, and also the shareholder of the VIE.

Agreements have not been tested in court.

As a result of our use of the VIE structure, you may never directly hold equity interests the

Any securities that we offer will be securities of the Company, the Delaware holding company, not of the VIE.

We fund the registered capital and operating

expenses of the VIE by extending loans to the shareholders of the VIE.

The VIE Agreements governing the relationship between the VIE

and our WFOE enable us to (i) direct the activities of the VIE that most significantly impact the VIEs economic performance, (ii)

receive substantially all of the economic benefits of the VIE, and (iii) have an exclusive call option to purchase, at any time, all

or part of the equity interests in and/or assets of the VIE to the extent permitted by Chinese laws.

As a result of the VIE Agreements,

the Company is considered the primary beneficiary of the VIE for accounting purposes and is able to consolidate the financial results

of the VIE in its consolidated financial statements in accordance with U.S.

As a result, investors in our Common Shares are not

purchasing an equity interest in the VIE but instead are purchasing equity interest in FingerMotion, Inc., a Delaware holding company.

Share Exchange Agreement

Effective July 13, 2017, the Company entered

into that certain Share Exchange Agreement (the Share Exchange Agreement ) by and among the Company, Finger Motion

Company Limited, a Hong Kong corporation ( FMCL ) and certain shareholders of FMCL (the FMCL Shareholders ).

FMCL, a Hong Kong corporation, was formed on April 6, 2016 and is an information technology company that specializes in operating and

publishing mobile games.

Pursuant to the Share Exchange Agreement, the Company agreed to exchange the outstanding equity stock of FMCL

held by the FMCL Shareholders for shares of common stock of the Company.

On the closing date of the Share Exchange Agreement, the Company

issued 12,000,000 shares of common stock to the FMCL shareholders.

In addition, the Company issued 600,000 shares to consultants in connection

with the transactions contemplated by the Share Exchange Agreement, and 2,562,500 additional shares to accredited investors, which was

a concurrent financing but not a condition of closing the Share Exchange Agreement.

As a result of the Share Exchange Agreement and

the other transactions contemplated thereunder, FMCL became a wholly owned subsidiary of the Company.

The Company operates its video

game division through FMCL.

However, in June 2018, the Company decided to pause the operation of the game division as it saw the opportunity

in the telecommunication business and have since refocused into this business.

This description of the Share Exchange Agreement

does not purport to be complete and is qualified in its entirety by reference to the terms of the Share Exchange Agreement, which was

filed as an exhibit to our Current Report on Form 8-K filed with the SEC on July 20, 2017 and incorporated by reference herein.

VIE Agreements

On October 16, 2018, the Company, through its

indirect wholly owned subsidiary, Shanghai JiuGe Business Management Co., Ltd.

( JiuGe Management ), entered into

a series of agreements known as variable interest agreements (the VIE Agreements ) pursuant to which Shanghai JiuGe

Information Technology Co., Ltd.

( JiuGe Technology ) became our contractually controlled affiliate.

The use of VIE

agreements is a common structure used to acquire PRC corporations, particularly in certain industries in which foreign investment is

restricted or forbidden by the PRC government.

The VIE Agreements include a Consulting Services Agreement, a Loan Agreement, a Power

of Attorney Agreement, a Call Option Agreement, and a Share Pledge Agreement in order to secure the connection and commitments of JiuGe

We operate our mobile payment platform business through JiuGe Technology.

VIE Agreements included:

The VIE Agreements included:

consulting services agreement through which JiuGe Management is mainly engaged in data marketing, technical services, technical consulting

99 unchanged sentences

without the prior consent of the WFOE.

PRC counsel has reviewed these agreements and believes that all the VIE Agreements were duly signed and are not in violation of applicable

We are of the opinion that the VIE Agreements are valid and giving the WFOE a full control over the VIE in respect of the

current and effective PRC laws and regulations.

However, the VIE Agreements have never been challenged or recognized in court for the

time being, and the PRC government may determine that the VIE Agreements are not in compliance with applicable PRC laws, rules and regulations

compared with direct ownership, there may be less effective in controlling through the VIE structure.

the first half of 2018, JiuGe Technology secured contracts with China Unicom and China Mobile to distribute mobile data for businesses

and corporations in 9 provinces/municipalities, namely Chengdu, Jiangxi, Jiangsu, Chongqing, Shanghai, Zhuhai, Zhejiang, Shaanxi and

Inner Mongolia.

Our PRC counsel has reviewed these agreements and believes that all the VIE Agreements were

duly signed and are not in violation of applicable laws of PRC.

We are of the opinion that the VIE Agreements are valid and giving the

WFOE a full control over the VIE in respect of the current and effective PRC laws and regulations.

However, the VIE Agreements have never

been challenged or recognized in court for the time being, and the PRC government may determine that the VIE Agreements are not in compliance

with applicable PRC laws, rules and regulations compared with direct ownership, there may be less effective in controlling through the

VIE structure.

the first half of 2018, JiuGe Technology established contracts with China Unicom and China Mobile, initiating the provision of mobile

data services to businesses and corporations in key provinces/municipalities including Chengdu, Jiangxi, Jiangsu, Chongqing, Shanghai,

Zhuhai, Zhejiang, Shaanxi and Inner Mongolia.

As with all dynamic markets, the specifics of our operational contracts have naturally

evolved over time but our dedication to these provinces is unwavering, and we consistently enhance our service and product offerings

to ensure optimal service.

Additionally, as we continue to grow, there is the potential for our reach to expand into additional provinces

September 2018, JiuGe Technology launched and commercialized mobile payment and recharge services to businesses for China Unicom.

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mass SMS text message service offers bulk SMS services to end consumers with competitive pricing.

Currently, the Companys SMS

integrated platform is processing more than 150 million SMS text messages per month.

Beijing Technology retains a license from the Ministry

of Industry and Information Technology to operate SMS and MMS business in the PRC.

Similar to the mobile recharge business, Beijing Technology

is required to make a deposit or bulk purchase in advance and has secured business customers that will utilize Beijing Technologys

SMS integrated platform to send bulk SMS text messages monthly.

Beijing Technology has the capability to manage and track the entire

process, including to assist the Companys clients to fulfill the government guidelines, until the SMS messages have been delivered

successfully.

of Industry and Information Technology ( MIIT ) to operate SMS and MMS business in the PRC.

Similar to the mobile

recharge business, Beijing Technology is required to make a deposit or bulk purchase in advance and has secured business customers that

will utilize Beijing Technologys SMS integrated platform to send bulk SMS text messages monthly.

Beijing Technology has the capability

to manage and track the entire process, including to assist the Companys clients to fulfil the government guidelines, until the

SMS messages have been delivered successfully.

Unicom Cooperation Agreement

10 unchanged sentences

sales it processes for China Unicom Yunnan on the platform.

Cooperation Agreement expires three years from the date of its signature with a yearly auto-renewal clause, but it may be terminated

by (i) JiuGe Technology upon three months written notice or (ii) by China Unicom Yunnan unilaterally.

The Cooperation Agreement

contains customary representations from each party regarding such partys authority to enter into and perform under the Cooperation

Agreement, and provides customary events of default, including for various types of failure to perform.

Any disputes arising between

the parties under the Cooperation Agreement will be adjudicated in Chinese courts.

Cooperation Agreement expires three years from the date of its signature, subject to a yearly auto-renewal clause, which is currently

in an auto-renewal period, but it may be terminated by (i) JiuGe Technology upon three months written notice or (ii) by China

Unicom Yunnan unilaterally.

The Cooperation Agreement contains customary representations from each party regarding such partys

authority to enter into and perform under the Cooperation Agreement, and provides customary events of default, including for various

types of failure to perform.

Any disputes arising between the parties under the Cooperation Agreement will be adjudicated in Chinese

description of the Cooperation Agreement does not purport to be complete and is qualified in its entirety by reference to the terms of

65 unchanged sentences

obligations under such contractual arrangements would have a material and adverse effect on our business.

of the date of this periodic report on Form 10-Q, we and the VIE are not required to seek permissions from the CSRC, the CAC, or any

of the date of this periodic report om Form 10-Q, we and the VIE are not required to seek permissions from the CSRC, the CAC, or any

other entity that is required to approve of the operations of the VIE, other than a value-added telecommunications business licence,

31 unchanged sentences

of China Unicom and China Mobile.

conduct our mobile payment business through Shanghai JiuGe Technology Co., Ltd.

( JiuGe Technology ), our contractually

controlled affiliate through the entry into the VIE Agreements in October 2018.

In the first half of 2018, JiuGe Technology secured contracts

with China Unicom and China Mobile to distribute mobile data for businesses and corporations in nine provinces/municipalities, namely

Chengdu, Jiangxi, Jiangsu, Chongqing, Shanghai, Zhuhai, Zhejiang, Shaanxi, Inner Mongolia, Henan and Fujian.

In September 2018, JiuGe

Technology launched and commercialized mobile payment and recharge services to businesses for China Unicom.

In May 2021, JiuGe Technology

signed a volume-based agreement with China Mobile Fujian to offer recharge services to the Fujian province which we have launched and

commercialized in November 2021.

conduct our mobile payment business through JiuGe Technology, our contractually controlled affiliate through the entry into the VIE Agreements

in October 2018.

In the first half of 2018, JiuGe Technology secured contracts with China Unicom and China Mobile to distribute mobile

data for businesses and corporations in nine provinces/municipalities, namely Chengdu, Jiangxi, Jiangsu, Chongqing, Shanghai, Zhuhai,

Zhejiang, Shaanxi, Inner Mongolia, Henan and Fujian.

In September 2018, JiuGe Technology launched and commercialized mobile payment and

recharge services to businesses for China Unicom.

In May 2021, JiuGe Technology signed a volume-based agreement with China Mobile Fujian

to offer recharge services to the Fujian province which we have launched and commercialized in November 2021.

JiuGe Technology mobile payment and recharge platform enables the seamless delivery of real-time payment and recharge services to third-party

18 unchanged sentences

Additionally,

as previously disclosed, on July 7, 2019, JiuGe Technology, our contractually controlled affiliate, entered into that certain Yunnan

Unicom Electronic Sales Platform Construction and Operation Cooperation Agreement (the Cooperation Agreement ) with

China Unicoms Yunnan subsidiary.

Under the Cooperation Agreement, JiuGe Technology is responsible for constructing and operating

China Unicoms electronic sales platform through which consumers can purchase various goods and services from China Unicom, including

mobile telephones, mobile telephone service, broadband data services, terminals, smart devices and related financial insurance.

The Cooperation Agreement provides that JiuGe Technology is required to construct and operate the platforms webpage in accordance

with China Unicoms specifications and policies, and applicable law, and bear all expenses in connection therewith.

As consideration

for the service it provides under the Cooperation Agreement, JiuGe Technology receives a percentage of the revenue received from all

sales it processes for China Unicom on the platform.

The Cooperation Agreement expires three years from the date of its signature with

a yearly auto-renewal clause, but it may be terminated by (i) JiuGe Technology upon three months written notice or (ii) by China

Unicom unilaterally.

as previously disclosed, on July 7, 2019, JiuGe Technology, our contractually controlled affiliate, entered into that certain Cooperation

Agreement with China Unicom Yunnan, whereby JiuGe Technology is responsible for constructing and operating China Unicoms electronic

sales platform through which consumers can purchase various goods and services from China Unicom, including mobile telephones, mobile

telephone service, broadband data services, terminals, smart devices and related financial insurance.

The Cooperation Agreement

provides that JiuGe Technology is required to construct and operate the platforms webpage in accordance with China Unicoms

specifications and policies, and applicable law, and bear all expenses in connection therewith.

As consideration for the service JiuGe

Technology provides under the Cooperation Agreement, it receives a percentage of the revenue received from all sales it processes for

China Unicom on the platform.

The Cooperation Agreement expires three years from the date of its signature with a yearly auto-renewal

clause, which is currently in an auto-renewal period, but it may be terminated by (i) JiuGe Technology upon three months written

notice or (ii) by China Unicom unilaterally.

the recent fiscal year, the Company expanded its offering under their telecommunication product and services by increasing their product

8 unchanged sentences

partners to market.

The current and upcoming value-added product is the Mobile Protection programs which we plan to launch soon.

2022, our contractually controlled subsidiary, JiuGe Technology, through its 99% own subsidiary TengLian signed an agreement with both

China Unicom and China Mobile to co-operate to roll out the Mobile Device Protection product which is incorporated into the Telecommunication

subscription plans in line with their roll out of new mobile phones and new 5G phones.

In mid-July 2022, we launched the roll out of

the Mobile Device protection product with the roll out of the new mobile phones and 5G phones.

In February 2022, our contractually controlled subsidiary, JiuGe Technology, through its 99% own subsidiary TengLian

signed an agreement with both China Unicom and China Mobile to co-operate to roll out the Mobile Device Protection product which is incorporated

into the Telecommunication subscription plans in line with their roll out of new mobile phones and new 5G phones.

In mid-July 2022, we

launched the roll out of the Mobile Device protection product with the roll out of the new mobile phones and 5G phones.

and MMS Services

March 7, 2019, the Company through JiuGe Technology acquired Beijing XunLian TianXia Technology Co., Ltd.

March 7, 2019, the Company through JiuGe Technology acquired Beijing Technology Co, a company in the business of providing mass SMS text

services to businesses looking to communicate with large numbers of their customers and prospective customers.

With this acquisition,

the Company expanded into a second partnership with the telecom companies by acquiring bulk SMS and MMS bundles at reduced prices and

offering bulk SMS services to end consumers with competitive pricing.

Beijing Technology retains a license from MIIT to operate the SMS

and MMS business in the PRC.

Similar to the mobile payment and recharge business, Beijing Technology is required to make a deposit or

bulk purchase in advance and has secured business customers, including premium car manufacturers, hotel chains, airlines and e-commerce

companies, that utilize Beijing Technologys SMS integrated platform to send bulk SMS text messages monthly.

Beijing Technology

a company in the business of providing mass SMS text services to businesses looking to communicate with large numbers of their customers

and prospective customers.

With this acquisition, the Company expanded into a second partnership with the telecom companies by acquiring

bulk SMS and MMS bundles at reduced prices and offering bulk SMS services to end consumers with competitive pricing.

FingerMotions

subsidiary, Beijing Technology, retains a license from the Ministry of Industry and Information Technology (MIIT)

to operate the SMS and MMS business in the PRC.

Similar to the mobile payment and recharge business, Beijing Technology is required to

make a deposit or bulk purchase in advance and has secured business customers, including premium car manufacturers, hotel chains, airlines

and e-commerce companies, that utilize Beijing Technologys SMS integrated platform to send bulk SMS text messages monthly.

Technology has the capability to manage and track the entire process, including guiding the Companys customer to meet MIITs

guidelines on messages composed, until the SMS messages have been delivered successfully.

has the capability to manage and track the entire process, including guiding the Companys customer to meet MIITs guidelines

on messages composed, until the SMS messages have been delivered successfully.

Communication Services

29 unchanged sentences

industry with a comprehensive suite of products and services.

December 2021, the Company through JiuGe Technology formed a collaborative research alliance with Munich Re in extending behavioral analytics

to enhance understanding of morbidity and behavioral patterns in China market, with the goal of creating value for both insurers and

the end insurance consumers through better technology, product offerings and customer experience.

December 2021, the Company through JiuGe Technology formed a collaborative research alliance with Munich Re in extending behavioural

analytics to enhance understanding of morbidity and behavioural patterns in China market, with the goal of creating value for both insurers

and the end insurance consumers through better technology, product offerings and customer experience.

Video Game Division

6 unchanged sentences

payment and data business.

or about April 6, 2023, we eliminated our remaining convertible debt with our primary lender as a result of conversions by the primary

lender and payment by us to the primary lender.

April 28, 2023, we repaid in full the US$730,000 convertible note that was issued in favor of Dr.

Liew Yow Ming on May 1, 2022.

of Operations

Months Ended May 31, 2023 Compared to Three Months Ended May 31, 2022

Months Ended August 31, 2023 Compared to the Three Months Ended August 31, 2022

following table sets forth our results of operations for the periods indicated:

For the three months ended

August 31, 2023

August 31, 2022

Cost of revenue

7 unchanged sentences

$ (1,537,365 )

$ (1,444,123 )

Foreign currency translation adjustment

1 unchanged sentence

$ (1,071,427 )

$ (1,760,840 )

Basic Loss Per Share attributable to the Company

2 unchanged sentences

For the three months ended

August 31, 2023

August 31, 2022

Telecommunication Products & Services

1 unchanged sentence

Total Revenue

recorded $12,169,091 in revenue for the quarter ended May 31, 2023, an increase of $7,313,968 or 151%, compared to the quarter ended

May 31, 2022.

This increase resulted from an increase in revenue of $10,459,139 and $149,706 from our Telecommunication Products &

Services and Big Data business, respectively, offset in part by a decrease in revenue of $3,330,877 from our SMS & MMS business.

We principally earn revenue by providing mobile payment and recharge services to customers of telecommunications companies in China.

Specifically, we earn a negotiated rebate amount from the telecommunications companies for all monies paid by consumers to those companies

that we process.

The increase in this line of business especially in the mobile recharge revenue was evident as we deployed certain funding

that we had secured in the last few months to this line of business.

We plan to continue to develop our mobile recharge business and

expect that revenues would continue to grow further when we continue to deploy more funds.

In contrast, our SMS texting service has shown

a drop in revenue as compared to last year.

Declining revenue was attributed to a shift in our risk management focus.

However, we believe

this business will still be a major revenue and profit contributor to our overall financial health and ongoing effort are being undertaken

to improve this line of business.

In FY2021, our Big Data division secured a contract with Pacific Life Re, a global life reinsurance

serving the insurance industry with a comprehensive suite of products and services, to develop a holistic multi-faceted risk rating concept,

leveraging the Companys proprietary approach to analytics by drawing data from novel sources and filtering them through advance

algorithms with the ultimate goal to apply new insights generated from our predictive model to the traditional insurance industry.

upon the successful implementation of the initial phase, Pacific Life Re proceeded with Phase 2 in the previous fiscal year.

last quarter of FY2022, we established a collaborative research alliance with Munich Re in extending behavioural analytics to enhance

understanding of morbidity and behavioural patterns in the Chinese market.

The objective is to create value for both insurers and the

end insurance consumers through technology advancements, improved product offerings and enhanced customer experiences.

The collaboration

with Munich Re was further extended in the last quarter of FY2023.The revenue recorded during the current quarter in our Big Data division

is a result of both the contracts with Pacific Life Re and Munich Re.

recorded $9,279,166 in revenue for the three months ended August 31, 2023, an increase of $4,296,209 or 86%, compared to the three months

ended August 31, 2022.

This increase resulted from an increase in revenue of $6,383,730 from our Telecommunication Products & Services,

buoyed by both the addition of a new product line and organic expansion, and an increase in revenue of $14,246 from our Big Data business,

offset in part by a decrease in revenue of $2,101,767 from our SMS & MMS business.

We principally earn revenue by providing mobile

payment and recharge services to customers of telecommunications companies in China.

Specifically, we earn a negotiated rebate amount

from the telecommunications companies for all monies paid by consumers to those companies that we process.

The notable revenue escalation

in the Telecommunication Products & Services not only reflect our recent capital allocation into this domain, leveraging funds received

in the preceding months but also our efforts in diversifying our offerings with new product line.

We foresee sustained growth for this

segment as we strategize to allocate more resources in the coming months.

Contrastingly, our SMS and MMS business has reduced substantially

as compared to the previous three months ended August 31, 2022.

Changes in the government protocol for SMS and MMS distribution resulted

in a significant decline in our revenue in this sector, compelling us to focus on our other business lines.

However, its imperative

to note that we remain optimistic about the SMS and MMS business.

It continues to hold significance in our broader financial picture,

and we are diligently formulating enhancements to rejuvenate this services performance.

In shifting focus to our Big Data business

in FY2021, we forged a valuable alliance with Pacific Life Re, a global life reinsurance serving the insurance industry with a comprehensive

suite of products and services, to develop a holistic multi-faceted risk rating concept, leveraging the Companys proprietary approach

to analytics by drawing data from novel sources and filtering them through advance algorithms with the ultimate goal of applying new

insights generated from our predictive model to the traditional insurance industry.

Building upon the successful implementation of the

initial phase, Pacific Life Re proceeded with Phase 2 in the previous fiscal year.

During the last quarter of FY2022, we established

a collaborative research alliance with Munich Re in extending behavioural analytics to enhance understanding of morbidity and behavioural

patterns in the Chinese market.

The objective is to create value for both insurers and the end insurance consumers through technology

advancements, improved product offerings and enhanced customer experiences.

The collaboration with Munich Re was further extended in

the last quarter of FY2023.

The revenue recorded during the current quarter in our Big Data division is a result of both the contracts

with Pacific Life Re and Munich Re.

While the revenue of our Big Data division has seen a positive shift in the current quarter, primarily

due to our collaborations with Pacific Life Re and Munich Re, the magnitude of this growth has been modest.

However, we are optimistic

and anticipate more significant improvements in the upcoming periods.

following table sets forth the Companys cost of revenue for the periods indicated:

For the three months ended

August 31, 2023

August 31, 2022

Telecommunication Products & Services

1 unchanged sentence

Total Cost of Revenue

recorded $11,506,542 in costs of revenue for the quarter ended May 31, 2023, an increase of $7,028,490 or 157%, compared to the quarter

ended May 31, 2022.

As previously mentioned, we principally earn revenue by providing mobile payment and recharge services to customers

of telecommunications companies, subscription plans and mobile phone sales in China.

To earn this revenue, we incur cost of the product,

certain customer acquisition costs, including discounts to our customers and promotional expenses, which is reflected in our cost of

gross profit for the quarter ended May 31, 2023 was $662,549, an increase of $285,478 or 76%, compared to the quarter ended May 31, 2022.

This increase in gross profit resulted from higher revenue for the period.

recorded $7,437,632 in costs of revenue for the three months ended August 31, 2023, an increase of $2,872,459 or 63%, compared to the

three months ended August 31, 2022.

As previously mentioned, we principally earn revenue by providing mobile payment and recharge services

to customers of telecommunications companies, subscription plans and mobile phone sales in China.

To earn this revenue, we incur cost

of the product, certain customer acquisition costs, including discounts to our customers and promotional expenses, which is reflected

in our cost of revenue.

gross profit for the three months ended August 31, 2023 was $1,841,534, an increase of $1,423,750 or 341%, compared to the three months

ended August 31, 2022.

The significant increase in gross profit was attributed to not only the enhanced revenue for the period but also

the introduction of new product mix within the Telecommunication Products & Services.

& Depreciation

recorded depreciation of $18,342 for fixed assets for the quarter ended May 31, 2023, an increase of $4,170 or 29%, compared to the quarter

ended May 31, 2022.

recorded depreciation of $17,671 for fixed assets for the three months ended August 31, 2023, an increase of $4,205 or 31%, compared

to the three months ended August 31, 2022.

& Administrative Expenses

1 unchanged sentence

For the three months ended

August 31, 2023

August 31, 2022

Entertainment

2 unchanged sentences

Total G&A Expenses

recorded $1,361,990 in general and administrative expenses for the quarter ended May 31, 2023, an increase of $122,440 or 10%, compared

to the quarter ended May 31, 2022.

The key increases, especially for consulting, entertainment, and travelling in the quarter ended May

31, 2023 as compared to the previous quarter ended May 31, 2022, were mainly a result of potential funding activities being undertaken

and IT & Technical Fees.

As for the IT and Technical Fees, we are putting more resources into the development and enhancement of

our platform.

recorded $1,634,356 in general and administrative expenses for the three months ended August 31, 2023, an increase of $358,487 or 28%,

compared to the three months ended August 31, 2022.

The increase encompasses a range of costs integral to the Companys ongoing

operational and administrative requirements.

The expenses include, but are not limited to, regulatory filings, professional services

fees, ongoing funding activities, and other costs associated with adhering to both domestic and international operational standards and

requirements.

following table sets forth the Companys marketing cost for the periods indicated:

For the three months ended

August 31, 2023

August 31, 2022

Marketing Cost

recorded ($6,841) in marketing cost for the quarter ended May 31, 2023 for our telecommunication products and services business due to

overprovision no longer required and now adjusted.

Marketing costs represent the costs of promoting our product offerings through all

our platforms.

recorded $53,437 in marketing cost for the three months ended August 31, 2023, being a decrease of $110,952 or 66%, compared to the three

months ended August 31, 2022.

These marketing costs were for our telecommunication products and services business.

Marketing costs represent

the costs of promoting our product offerings through all our platforms.

& Development

1 unchanged sentence

For the three months ended

August 31, 2023

August 31, 2022

Research & Development

incurred fees of $172,099 in research & development for the quarter ended May 31, 2023 as compared to $211,647 for the quarter ended

May 31, 2022.

The decrease of $39,548 or 19% was due to the savings from data access and usage fee charged by telecommunications company.

Insurtech division focuses on consumer behavioral insights extraction for the purpose of risk assessment.

Insights are mined from a multitude

of data sources, harmonized with the objectives of our various business partners.

The initial phase of business application is to focus

on the insurance industry, particularly in the area of underwriting risk rating, complementary claims adjudication and assessment, and

risk segmentation & market penetration.

incurred fees of $176,956 in research & development for the three months ended August 31, 2023 as compared to $198,104 for the three

months ended August 31, 2022.

The decrease of $21,148 or 11% was due to the savings from data access and usage fee charged by telecommunications

Insurtech division focuses on consumer behavioural insights extraction for the purpose of risk assessment.

Insights are mined from a

multitude of data sources, harmonized with the objectives of our various business partners.

The initial phase of business application

is to focus on the insurance industry, particularly in the area of underwriting risk rating, complementary claims adjudication and assessment,

and risk segmentation & market penetration.

division comprises of experienced actuaries, data scientists, and computer programmers.

1 unchanged sentence

the past year, we have deepened the Companys determined commitment toward working with partners in elucidating consumer insights

via big data algorithms and applying behavioral analytics to the fintech sector in sparking new innovations and commercial applications.

via big data algorithms and applying behavioural analytics to the fintech sector in sparking new innovations and commercial applications.

The following capture the most recent accomplishments and milestones:

Strengthening

partnership network – Signed a new agreement to advance to the next phase of collaboration with Pacific Life Re in Asia.

partnership network – Signed the Phase 2 Collaboration Agreement with Pacific Life Re in Asia in August 2022.

of the analytic engine – We have enriched the algorithms with more elaborative auxiliary data, which, in conjunction with the

17 unchanged sentences

the field of insurance, finance, and beyond, demonstrating the Companys active participation and contributions to the industry.

is important to emphasize that our allocation to research and development is foundational to our technology-oriented operations.

steadfast dedication to innovation remains undiminished, and we expect to persistently advance in our developmental endeavours to reinforce

our technological edge.

Compensation Expenses

1 unchanged sentence

For the three months ended

August 31, 2023

August 31, 2022

Share compensation expenses

incurred fees of $154,418 in share issuance for consultants in consideration of the services which have been provided to the Company

for the quarter ended May 31, 2023 as compared to $289,931 for the quarter ended May 31, 2022.

The increase of $6,530 or 2% was due to

the engagement of consultants to the Company that were compensated with shares of the company.

The rationale for rewarding these consultants

and advisors with shares is to minimize the usage of cash by the Company to allow the Company to use the cash to invest in revenue-generating

recorded $1,842,051 in operating expenses for the quarter ended May 31, 2023, as compared to $1,812,491 in operating expenses for the

quarter ended May 31, 2022.

The increase of $29,560 or 2%, for the quarter ended May 31, 2023 is as set forth above.

for the three months ended August 31, 2023, as compared to $254,547 for the three months ended August 31, 2022.

The decrease of $100,129

or 39% was due to the reduced engagement of consultants to the Company that were compensated with shares of our common stock.

The rationale

for compensating these consultants and advisors with shares is to minimize the usage of cash by the Company to allow the Company to use

the cash to invest in revenue-generating activities.

recorded $2,041,838 in operating expenses for the three months ended August 31, 2023, as compared to $1,911,375 in operating expenses

for the three months ended August 31, 2022.

The increase of $130,463 or 7%, for the three months ended August 31, 2023, is as set forth

loss attributable to the Companys shareholders

net loss attributable to the Companys shareholders was $1,265,471 for the quarter ended May 31, 2023 and $1,444,123 for the quarter

ended May 31, 2022.

The decrease in net loss attributable to the Companys shareholders of $178,652 or 12% resulted primarily from

the higher revenue and gross profit as discussed above.

net loss attributable to the Companys shareholders was $134,081 for the three months ended August 31, 2023, and $1,537,365 for

the three months ended August 31, 2022.

The decrease in net loss attributable to the Companys shareholders of $1,403,284 or 91%

resulted primarily from the higher revenue and gross profit as discussed above.

Months Ended August 31, 2023 Compared to the Six Months Ended August 31, 2022

following table sets forth our results of operations for the periods indicated:

For the six months ended

August 31, 2023

August 31, 2022

Cost of revenue

$ (18,944,174 )

$ (9,043,225 )

Total operating expenses

$ (3,883,889 )

$ (3,723,866 )

Total other income (expenses)

Net loss attributable to the Companys shareholders

$ (1,399,552 )

$ (2,981,488 )

Foreign currency translation adjustment

Comprehensive loss attributable to the Company

$ (1,923,042 )

$ (3,510,244 )

Basic Loss Per Share attributable to the Company

Diluted Loss Per Share attributable to the Company

following table sets forth the Companys revenue from its three lines of business for the periods indicated:

For the six months ended

August 31, 2023

August 31, 2022

Telecommunication Products & Services

SMS & MMS Business

Total Revenue

recorded $21,448,257 in revenue for the six months ended August 31, 2023, an increase of $11,610,177 or 118%, compared to the six months

ended August 31, 2022.

This increase resulted from an increase in revenue of $16,878,869 from our Telecommunication Products & Services,

buoyed by both the addition of a new product line and organic expansion, and an increase of revenue of $163,952 from our Big Data business,

offset in part by a decrease in revenue of $5,432,644 from our SMS & MMS business.

We principally earn revenue by providing mobile

payment and recharge services to customers of telecommunications companies in China.

Specifically, we earn a negotiated rebate amount

from the telecommunications companies for all monies paid by consumers to those companies that we process.

The increase in this line

of business especially in the mobile recharge revenue was evident as we deployed certain funding that we had secured in the recent past

months to this line of business.

The notable revenue escalation in the Telecommunication Products & Services not only reflects our

recent capital allocation into this domain, leveraging funds received in the preceding months but also our efforts in diversifying our

offerings with new product lines.

We foresee sustained growth for this segment as we strategize to allocate more resources in the coming

Contrastingly, our SMS and MMS business has reduced substantially as compared to the previous six months ended August 31, 2022.

Changes in the government protocol for SMS and MMS distribution resulted in a significant decline in our revenue in this sector, compelling

us to focus on our other business lines.

However, its imperative to note that we remain optimistic about the SMS and MMS business.

It continues to hold significance in our broader financial picture, and we are diligently formulating enhancements to rejuvenate this

services performance.

In shifting focus to our Big Data business in FY2021, we forged a valuable alliance with Pacific Life Re,

a global life reinsurance serving the insurance industry with a comprehensive suite of products and services, to develop a holistic multi-faceted

risk rating concept, leveraging the Companys proprietary approach to analytics by drawing data from novel sources and filtering

them through advance algorithms with the ultimate goal to apply new insights generated from our predictive model to the traditional insurance

Building upon the successful implementation of the initial phase, Pacific Life Re proceeded with Phase 2 in the previous fiscal

During the last quarter of FY2022, we established a collaborative research alliance with Munich Re in extending behavioural analytics

to enhance understanding of morbidity and behavioural patterns in the Chinese market.

The objective is to create value for both insurers

and the end insurance consumers through technology advancements, improved product offerings and enhanced customer experiences.

The collaboration

with Munich Re was further extended in the last quarter of FY2023.The revenue recorded during the current six month period in our Big

Data division is a result of both the contracts with Pacific Life Re and Munich Re.

While the revenue of our Big Data division has seen

a positive shift in the current six month period, primarily due to our collaborations with Pacific Life Re and Munich Re, the magnitude

of this growth has been modest.

However, we are optimistic and anticipate more significant improvements in the upcoming periods.

following table sets forth the Companys cost of revenue for the periods indicated:

For the six months ended

August 31, 2023

August 31, 2022

Telecommunication Products & Services

SMS & MMS Business

Total Cost of Revenue

recorded $18,944,174 in costs of revenue for the six months ended August 31, 2023, an increase of $9,900,949 or 109%, compared to the

six months ended August 31, 2022.

As previously mentioned, we principally earn revenue by providing mobile payment and recharge services

to customers of telecommunications companies, subscription plans and mobile phone sales in China.

To earn this revenue, we incur cost

of the product, certain customer acquisition costs, including discounts to our customers and promotional expenses, which is reflected

in our cost of revenue.

gross profit for the six months ended August 31, 2023 was $2,504,083, an increase of $1,709,228 or 215%, compared to the six months ended

August 31, 2022.

The significant increase in gross profit was attributed to not only the enhanced revenue for the period but also the

introduction of new product mix within the Telecommunication Products & Services.

& Depreciation

recorded depreciation of $36,013 for fixed assets for the six months ended August 31, 2023, an increase of $8,375 or 30%, compared to

the six months ended August 31, 2022.

& Administrative Expenses

following table sets forth the Companys general and administrative expenses for the periods indicated:

For the six months ended

August 31, 2023

August 31, 2022

Entertainment

Salaries & Wages

Technical Fee

Total G&A Expenses

recorded $2,996,346 in general and administrative expenses for the six months ended August 31, 2023, an increase of $480,927 or 19%,

compared to six months ended August 31, 2022.

The increase encompasses a range of costs integral to the Companys ongoing operational

and administrative requirements.

The expenses include, but are not limited to, regulatory filings, professional services fees, ongoing

funding activities, and other costs associated with adhering to both domestic and international operational standards and requirements.

following table sets forth the Companys marketing cost for the periods indicated:

For the six months ended

August 31, 2023

August 31, 2022

Marketing Cost

recorded $51,596 in marketing cost for the six months ended August 31, 2023, being a decrease of $174,984 or 77%, compared to the six

months ended August 31, 2022.

These marketing costs were for our telecommunication products and services business.

Marketing costs represent

the costs of promoting our product offerings through all our platforms.

& Development

following table sets forth the Companys research & development for the periods indicated:

For the six months ended

August 31, 2023

August 31, 2022

Research & Development

incurred fees of $349,055 in research & development for the six months ended August 31, 2023, as compared to $409,751 for the six

months ended August 31, 2022.

The decrease of $60,696 or 15% was due to the savings from data access and usage fee charged by telecommunications

Insurtech division focuses on consumer behavioural insights extraction for the purpose of risk assessment.

Insights are mined from a

multitude of data sources, harmonized with the objectives of our various business partners.

The initial phase of business application

is to focus on the insurance industry, particularly in the area of underwriting risk rating, complementary claims adjudication and assessment,

and risk segmentation & market penetration.

division comprises of experienced actuaries, data scientists, and computer programmers.

expenses for research & development include associated wages and salaries, data access fees and IT infrastructure.

the past year, we have deepened the Companys determined commitment toward working with partners in elucidating consumer insights

via big data algorithms and applying behavioural analytics to the fintech sector in sparking new innovations and commercial applications.

The following capture the most recent accomplishments and milestones:

Strengthening

partnership network – Signed the Phase 2 Collaboration Agreement with Pacific Life Re in Asia in August 2022.

of the analytic engine – We have enriched the algorithms with more elaborative auxiliary data, which, in conjunction with the

existing information system and records, will lend transformational support and capabilities to the analytics, empowering more precise

and robust results that are suited for commercial applications.

The collaborative research studies with leading industry partners

have enhanced and validated our analytic framework and insurance risk rating services platform, which is now ready for deployment

to the wide insurance and financial services industry.

rollout for market adoption – Our risk rating services platform is built on an application programming interface (API) structure

that is integrated with our partners core system, linked to an underlying data repertoire and analytic framework that facilitates

real-time rating feedback to insurance companies.

Regular API upgrades and enhancements enable greater flexibility in tightening

service integration and broadening commercial opportunities with our partners.

patent recognition – Over the past two years, Sapientus has been granted eight patents by the National Copyright Administration

of China (NCAC) for the abovementioned model algorithms and technological infrastructure as well as insurance-oriented applications,

for example, Risk Rating API Design, Insurance Risk Assessment platform and Insurance Fraud Detection System (one other applications

is still pending approval).

NCAC is the governing body for patent and copyright verification and approval in China.

The Companys

successful applications for these patents validate Sapientus continuing innovation in data science and its application in

the field of insurance, finance, and beyond, demonstrating the Companys active participation and contributions to the industry.

is important to emphasize that our allocation to research and development is foundational to our technology-oriented operations.

steadfast dedication to innovation remains undiminished, and we expect to persistently advance in our developmental endeavours to reinforce

our technological edge.

Compensation Expenses

following table sets forth the Companys share compensation expenses for the periods indicated:

For the six months ended

August 31, 2023

August 31, 2022

Share compensation expenses

incurred fees of $450,879 in share issuance for consultants in consideration of the services which have been provided to the company

for the six months ended August 31, 2023, as compared to $544,478 for the six months ended August 31, 2022.

The decrease of $93,599 or

17% was due to the reduced engagement of consultants to the Company that were compensated with shares of our common stock.

The rationale

for rewarding these consultants and advisors with shares is to minimize the usage of cash by the Company to allow the Company to use

the cash to invest in revenue-generating activities.

recorded $3,883,889 in operating expenses for the six months ended August 31, 2023, as compared to $3,723,866 in operating expenses for

the six months ended August 31, 2022.

The increase of $160,023 or 4%, for the six months ended August 31, 2023, is as set forth above.

Loss attributable to the Companys shareholders

net loss attributable to the Companys shareholders was $1,399,552 for the six months ended August 31, 2023, and $2,981,488 for

the six months ended August 31, 2022.

The decrease in net loss attributable to the Companys shareholders of $1,581,936 or 53%

resulted primarily from the higher revenue and gross profit as discussed above.

and Capital Resources

following table sets out our cash and working capital as of May 31, 2023 and February 28, 2023:

As at May 31,

following table sets out our cash and working capital as of August 31, 2023 and February 28, 2023:

As at August 31,

As at February 28,

1 unchanged sentence

Working capital

May 31, 2023, we had cash and cash equivalents of $5,424,912, as compared to cash and cash equivalents of $9,240,241 at February 28,

In order for us to continue to operate our mobile payment business, we must deposit funds with our telecommunication companies

from time to time in order to obtain access to the mobile data and talk time we make available to consumers on our portal.

With the recent

funds that we have managed to raise, we have deployed some of these funds into operations to increase our prepayments and deposits with

the telecommunication companies and in return able to generate a higher revenue.

Accordingly, the amount of cash we have on hand fluctuates

significantly from period to period as explained above to ensure our cash is being used efficiently by our operations to generate revenues.

The Company otherwise does not have any planned capital expenditures and has historically funded its operations from revenues and sales

of securities, including convertible debt securities.

We believe that our cash on hand, cash equivalents, and short-term investments,

along with our revenues from operations, will fund our projected operating requirements, fund our current operations and repay our outstanding

indebtedness, in each case, for at least the next 12 months.

However, to grow our business substantially, we will need to increase the

amount of funds we have deposited with the telecommunications companies for which we process mobile recharge payments.

Accordingly, we

intend to continue to seek additional capital through public or private sales of our equity or debt securities, or both.

We might also

enter into financing arrangements with commercial banks or non-traditional lenders.

We cannot provide investors with any assurance that

we will be able to raise additional funding from the sale of our equity or debt securities, or both, in order to increase our deposits

with our telecommunications company clients, or if available, that such funding will be on terms acceptable to us.

did, however, raise $60,000 through the sale of shares of our common stock in a private placement transaction exempt from the registration

requirements of the Securities Act during the period ended May 31, 2023.

August 31, 2023, we had cash and cash equivalents of $4,043,279, as compared to cash and cash equivalents of $9,240,241 at February 28,

Our mobile payment business model necessitates periodic fund deposits with our telecommunication companies to obtain access to

the mobile data and talk time we make available to consumers on our portal.

Our recent capital influx enabled us to amplify our prepayments

and deposits with the telecommunication entities, subsequently driving a surge in revenue.

Therefore, the observed variability in our

cash holdings is a deliberate operational strategy to optimize revenue generation.

The Company otherwise does not have any planned capital

expenditures and has historically funded its operations from revenues and sales of securities, including convertible debt securities.

We believe that our cash on hand and cash equivalents, coupled with our operating revenues, will sufficiently cover our projected operational

needs and address our outstanding liabilities for the upcoming year.

For more expansive growth, further enhancing our deposits with telecommunication

entities will be crucial.

In line with this, we intend to continue to seek additional capital through public or private sales of our

equity or debt securities, or both.

We might also enter into financing arrangements with commercial banks or non-traditional lenders.

We cannot provide investors with any assurance that we will be able to raise additional funding from the sale of our equity or debt securities,

or both, in order to increase our deposits with our telecommunications company clients, or if available, that such funding will be on

terms acceptable to us.

did, however, raise $840,000 through the exercise of warrants to purchase shares of our common stock during the six months ended August

31, 2023, which transactions were exempt from the registration requirements of the U.S.

Securities Act of 1933, as amended (the U.S.

Securities Act ).

following table provides a summary of cash flows for the periods presented:

For the three months ended

For the six months ended

August 31, 2023

August 31, 2022

Net cash used in operating activities

$ (4,874,162 )

Net cash used in investing activities

Net cash provided by financing activities

$ (3,785,843 )

Net cash used in investing activities

Net cash provided by (used in) financing activities

Effect of exchange rates on cash & cash equivalents

2 unchanged sentences

Flow used in Operating Activities

cash used in operating activities increased by $2,155,983 in the three months ended May 31, 2023 compared to the three months ended May

31, 2022, primarily due to an increase in account receivable of ($322,774) (May 31, 2022:

$887,094), increase in other receivable of

($1,659,906) (May 31, 2022:

$975), decrease in accrual and other payable of ($645,872) (May 31, 2022:

$832,880) and decrease in lease

liability of ($1,188) (May 31, 2022:

offset by decrease in prepayment and deposit of $899,836 (May 31, 2022:

$326,836) and increase

in accounts payable of $32,328 (May 31, 2022:

cash used in operating activities increased by $1,088,319 in the six months ended August 31, 2023 compared to the six months ended August

31, 2022, primarily due to an increase in account receivable of ($7,292,931) (August 31, 2022:

$1,686,094), increase in other receivable

of ($2,067,397) (August 31, 2022:

$14,789), decrease in accrual and other payable of ($434,852) (August 31, 2022:

($585,539)) and decrease

in lease liability of ($2,673) (August 31, 2022:

offset by decrease in prepayment and deposit of $329,727 (August 31, 2022:

and increase in accounts payable of $5,327,561 (August 31, 2022:

($1,778,928)).

Flow used in Investing Activities

the quarter ended May 31, 2023, net cash used in investing activities increased by $380 compared to $Nil in the quarter ended May 31,

The increase resulted from the purchase of equipment.

the six months ended August 31, 2023, net cash used in investing activities decreased by $3,748 compared to $4,120 in the six months

ended August 31, 2022.

Flow provided by Financing Activities

the quarter ended May 31, 2023, net cash provided by financing activities decreased by $1,805,333 compared to $730,000 provided by financing

activities in the quarter ended May 31, 2022.

the six months ended August 31, 2023, net cash provided by financing activities decreased by $5,825,333 compared to $5,530,000 provided

by financing activities in the six months ended August 31, 2022.

The decrease was primarily due to the repayment of convertible notes

and a decrease in the sale of equity securities during the six months ended August 31, 2023.

Sheet Arrangements

2 unchanged sentences

is material to investors.

have determined that we do not have any material subsequent events to report.

September 5, 2023, the Company issued 2,500 shares of our common stock at a deemed price of $2.47 per share to one entity pursuant to

a consulting agreement and issued 70,000 shares of our common stock at a deemed price of $1.64 per share to one entity pursuant to a

consulting agreement.

September 14, 2023, two officers of the Company exercised an aggregate of 180,400 stock options on a deemed net-stock exercise basis

resulting in the issuance of an aggregate of 90,898 shares of our common stock and the forfeiture of 89,502 stock options to the Company.

Accounting Policies

12 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements