What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-04-18 compared with 2024-09-20 · 93 added, 121 removed, 139 unchanged (61% of the section changed)

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and maintenance reduction product and services market.

Hydrogen Project Agreement

On September 13, 2024, HNO International, Inc.

formalized a Hydrogen Purchase and Sale Agreement with a leader in zero-emission transportation.

This agreement will see HNO International constructing and operating a hydrogen electrolysis plant and refueling station in Katy, Texas,

producing 0.5 metric tons of high-purity gaseous hydrogen daily.

The hydrogen will be used for refueling Class 8 fuel cell electric trucks,

promoting cleaner transportation options.

The initial three-year agreement, with the potential for extension, underscores HNO's commitment

to advancing hydrogen as a sustainable fuel alternative.

Results of Operations

For the three months ended July 31, 2024 and

For the three months ended January 31, 2025

For the three months ended

July 31, 2024, we generated $4,241 in revenue, compared to no revenue for the three months ended July 31, 2023.

Revenue was recognized

from hydrogen engineering services and combustion solutions.

January 31, 2025 and January 31, 2024, we generated no revenue.

Operating Expenses

Operating expenses for the three months ended July

Operating expenses for the three months ended January

31, 2025, were $627,406 compared to $500,441 for the same period in 2024.

This increase is attributable to the Company’s efforts

to expand operations, which resulted in increased costs related to contract labor and general and administrative expenses.

We also expanded

our staff to support increased sales and marketing efforts.

Net loss for the three months ended July 31, 2024,

to expand operations.

Net loss for the three months ended January 31, 2025,

was $634,338 compared to a net loss of $507,073 during the same period in 2024.

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General and Administrative, and Contract Labor expenses

were $430,693 for the three months ended July 31, 2024, as compared to $437,472 during the same period in 2023.

Operating expenses changed

due to the Company’s efforts to expand operations, resulting in increased costs related to contract labor and general and administrative

For the nine months ended July 31, 2024 and

For the nine months ended

July 31, 2024, was $4,241 compared to $13,000 for the nine months ended July 31, 2023.

Revenue generated was from hydrogen engineering

services and combustion solutions.

were $302,105 for the three months ended January 31, 2025, as compared to $464,005 during the same period in 2024.

Operating expenses

Operating expenses for the nine months ended July

31, 2024, were $1,569,846 compared to $950,532 for the same period in 2023.

This is attributable to the Company’s efforts to expand

operations, which resulted in increased costs related to contract labor and general and administrative expenses.

As 2024 progressed, we

experienced a significant increase in hiring contract labor to support our Research and Development program.

We also expanded our staff

to support increased sales and marketing efforts.

Net loss for the nine months ended July 31, 2024,

was $1,584,438 compared to a net loss of $962,028 during the same period in 2023.

General and Administrative, and Contract Labor

General and Administrative, and Contract Labor expenses

were $1,440,197 for the nine months ended July 31, 2024, as compared to $927,082 during the same period in 2023.

Operating expenses changed

due to the Company’s efforts to expand operations, resulting in increased costs related to contract labor and general and administrative

changed due to the Company’s efforts to streamline operations and reduce overhead costs.

Forward-Looking Considerations

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Liquidity and Capital Resources

a net loss for the three months ended July 31, 2024 of $496,621 and had an accumulated deficit of $43,194,383 at July 31, 2024.

31, 2024, we had a cash balance of $78,917, compared to a cash balance of $235,159 at October 31, 2023.

At July 31, 2024, the working

capital deficit was $1,649,621, compared to a working capital deficit of $553,284 at October 31, 2023.

Our existing and available capital

resources are not expected to be sufficient to satisfy our funding requirements through one year from the date of this filing in the absence

of share issuances or other sources of financing.

a net loss for the three months ended January 31, 2025 of $634,338 and had an accumulated deficit of $44,960,664 at January 31, 2025.

At January 31, 2025, we had a cash balance of $47,900, compared to a cash balance of $20,255 at October 31, 2024.

At January 31, 2025,

the working capital deficit was $2,448,140, compared to a working capital deficit of $1,969,965 at October 31, 2024.

Our existing and

available capital resources are not expected to be sufficient to satisfy our funding requirements through one year from the date of this

filing in the absence of share issuances or other sources of financing.

been able to generate sufficient cash from operating activities to fund our ongoing operations.

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and the results of operations.

For the Nine Months Ended July 31, 2024 and 2023

For the Three months Ended January 31, 2025 and

The following table summarizes our cash flows for

the periods indicated below:

For the Nine Months Ended July 31,

the Three months Ended January 31,

Cash Used in Operating Activities

$ (1,380,178 )

Cash Provided by Financing Activities

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Cash Used in Operating Activities

During the nine months ended July 31, 2024, cash used

in operating activities was $(1,380,178), primarily reflecting our net losses for the period, adjusted by non-cash charges such as depreciation

and amortization, as well as changes in our working capital accounts.

These changes mainly consisted of an increase in accrued interest

payable, payroll taxes, and accounts payable, a decrease in the security deposit, and the settlement of a receivable from HNO Hydrogen

The receivable, totaling $56,392, was fully settled through a transfer of equipment in connection with a settlement agreement

effective April 15, 2024.

The settlement agreement involved the transfer of large equipment valued at $32,327 and small equipment valued

During the nine months ended July 31, 2023, cash used

in operating activities was $(904,365), primarily reflecting our net losses for the period, adjusted by non-cash charges of depreciation

and amortization, as well as an increase in accrued interest payable and payroll taxes.

During the three months ended January 31, 2025, cash

used in operating activities amounted to $(168,412), primarily reflecting our net loss of $(634,338).

This impact was partially offset

by non-cash charges, including depreciation and amortization of $54,449 and share-based compensation totaling $265,502.

Additionally,

there was an increase in accounts payable of $121,146, an increase in accrued payroll of $17,476, and an increase in accrued interest

payable of $6,931.

During the three months ended January 31, 2024, cash

used in operating activities totaled $(496,703), primarily reflecting our net loss of $(507,073).

This was offset by non-cash charges

such as depreciation and amortization amounting to $36,436.

Additionally, there was an increase in accrued interest payable and a decrease

in payroll taxes, contributing to the overall cash movements during the period.

Cash Used in Financing Activities

During the nine months ended

July 31, 2024, cash provided by financing activities was $1,592,612, which consisted of proceeds from related party advances of $800,585,

During the three months ended

January 31, 2025, cash provided by financing activities was $374,000, which consisted of proceeds from related party advances of $359,000,

proceeds from the sale of common stock and proceeds from the sale of common stock of $15,000.

During the nine months ended July 31, 2023, cash provided

by financing activities was $2,505,832, which consisted of proceeds from related party notes payable of $235,000 and proceeds from the

During the three months ended January 31, 2024, cash

provided by financing activities was $491,085, which consisted of proceeds from related party advances of $365,585 and proceeds from the

sale of common stock of $125,500.

Cash Provided by Investing Activities

During the nine months ended

July 31, 2024, cash used in investing activities was $(368,676), which consisted of the purchase of property and equipment and long-term

During the nine months ended July 31, 2023, cash used

in investing activities was $(425,880), which consisted of the purchase of plant and equipment.

During the three months ended

January 31, 2025, cash used in investing activities was $(177,943), which consisted of the purchase of property and equipment and long-term

During the three months ended January 31, 2024, cash

used in investing activities was $(160,739), which consisted of the purchase of plant and equipment and the purchase long term asset.

Going Concern

The Company’s financial statements have been

prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities

in the normal course of business.

During the nine months ended July 31, 2024, the Company incurred a net loss of $1,584,438 and used cash

in operating activities of $1,380,178, and on July 31, 2024, had stockholders’ deficit of $984,711.

These factors, among others,

raise substantial doubt about the Company’s ability to continue as a going concern.

These financial statements do not include any

adjustments relating to the recoverability and classification of recorded asset amounts or amounts and the classification of liabilities

that might result from this uncertainty.

The Company’s financial statements have

been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and the

satisfaction of liabilities in the normal course of business.

During the three months ended January 31, 2025, the Company incurred a

net loss of $634,338 and used cash in operating activities of $168,412, and on January 31, 2025, had stockholders’ deficit of

These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern.

These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset

amounts or amounts and the classification of liabilities that might result from this uncertainty.

Management is actively seeking additional sources

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STOCK-BASED COMPENSATION

The Company accounts for stock incentive awards issued

to employees and non-employees in accordance with FASB ASC 718, Stock Compensation.

Accordingly, stock-based compensation is measured

at the grant date, based on the fair value of the award.

Stock-based awards to employees are recognized as an expense over the requisite

service period, or upon the occurrence of certain vesting events.

Additionally, stock-based awards to non-employees are expensed over

the period in which the related services are rendered.

The Company accounts for stock-based compensation

in accordance with Accounting Standards Codification (“ASC”) 718 Compensation - Stock Compensation (“ASC 718”).

ASC 718 requires that the cost of equity instrument awards, issued in exchange for services, including those issued to employees and predominantly

to consultants, be measured at the grant-date fair value.

The Company does not adhere to a formal stock-based compensation plan;

it issues stock awards on a discretionary basis as part of compensation agreements with selected consultants and employees.

for stock-based awards is recognized as a non-cash expense on the income statement.

The expense associated with these awards is recorded

based on the fair value on the date of grant, as determined using the Black-Scholes-Merton option-pricing model.

This cost is recognized

over the period during which the award recipient is required to perform services, typically known as the vesting period.

The total compensation

cost related to vested stock-based awards is recognized after adjusting for estimated forfeitures at the time of vesting.

related to stock-based compensation is included within the same income statement lines as cash compensation for the consultants and employees

who receive the awards.

As of the report date, the Company has not established any plans to issue dividends on stock-based awards.

tax benefits arising from deductions for these awards are recorded in additional paid-in capital, provided they exceed the cumulative

compensation cost recognized.

DERIVATIVE LIABILITY

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REVENUE RECOGNITION

In accordance with ASC 606, revenue is recognized

when a customer obtains control of promised goods or services.

The amount of revenue recognized reflects the consideration to which we

expect to be entitled to receive in exchange for these goods or services.

The provisions of ASC 606 include a five-step process by which

we determine revenue recognition, depicting the transfer of goods or services to customers in amounts reflecting the payment to which

we expect to be entitled in exchange for those goods or services.

ASC 606 requires us to apply the following steps:

(1) identify the contract

with the customer;

(2) identify the performance obligations in the contract;

(3) determine the transaction price;

(4) allocate the transaction

price to the performance obligations in the contract;

and (5) recognize revenue when, or as, we satisfy the performance obligation.

recognize revenue for the sale of our products upon delivery to a customer.

We recognize revenue in accordance with ASC 606, Revenue

from Contracts with Customers .

The standard’s stated core principle is that an entity should recognize revenue to depict the

transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled

in exchange for those goods or services.

To achieve this core principle, ASC 606 includes provisions within a five-step model that includes

identifying the contract with a customer, identifying the performance obligations in the contract, determining the transaction price,

allocating the transaction price to the performance obligations, and recognizing revenue when, or as, an entity satisfies a performance

RECENT ACCOUNTING PRONOUNCEMENTS

In August 2020, the FASB issued ASU 2020-06,

Debt— Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s

Own Equity (Subtopic 815-40).

This update amends the guidance on convertible instruments and the derivatives scope exception for

contracts in an entity's own equity and improves and amends the related EPS guidance for both Subtopics.

This standard is effective

for fiscal years and interim periods within those fiscal years beginning after December 15, 2023, which means it will be effective

for our fiscal year beginning October 31, 2024.

Early adoption is permitted but no earlier than fiscal years beginning after

December 15, 2020, including interim periods within those fiscal years.

We are currently evaluating the impact of ASU 2020-06 on our

financial statements.

Other recent accounting pronouncements issued by the

FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange

Commission did not or are not believed by management to have a material impact on the Company's present or future financial statements.

In March 2024, the Financial Accounting Standards

Board (FASB) issued ASU No.

2024-01, "Compensation—Stock Compensation (Topic 718):

Scope Application of Profits Interest and

Similar Awards." This update clarifies the accounting for profits interest awards by specifying when these awards should be accounted

for under ASC 718, Stock Compensation, as opposed to other compensation arrangements like cash bonuses under ASC 710.

This clarification

is provided through a series of illustrative examples which show how to determine whether profits interest awards meet the conditions

of ASC 718, focusing on when such awards should be recognized as equity or liability.

The guidance is intended to increase the comparability

and consistency of financial reporting by providing clearer criteria for the accounting of profits interest awards.

For public companies, the amendments in this update

are effective for fiscal years beginning after December 15, 2024, including interim periods within those fiscal years.

For private companies,

the amendments are effective for fiscal years beginning after December 15, 2025, and interim periods within fiscal years beginning after

December 15, 2026.

Early adoption is permitted.

The Company is currently evaluating the impact of this accounting standard update on its

financial statements and will continue to assess its potential effects as the adoption date approaches.

PROPOSED TRANSACTIONS

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OUTSTANDING SHARE DATA

As of July 31, 2024, the following securities were

As of January 31, 2025, the following securities were

Common stock:

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Series A Preferred Stock:

Series B Preferred Stock:

QUANTITATIVE AND QUALITATIVE DISCLOSURES

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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 2. Management’s Discussion and Analysis