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The following discussion pertains to the historical operations and financial statements of Karbon-X Corp.
−Removed: ("Karbon-X" or the "Company") for the six months ended November 30, 2024, and 2023.
+Added: ("Karbon-X" or the "Company") for the nine months ended February 28, 2025, and February 29 2024 .
This discussion should be read in conjunction with the Company’s most recent Annual Report on Form 10-K for the year ended May 31, 2024, filed on September 13, 2024, which provides additional context and details on the Company's financial condition and results of operations.
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Results of Operations
−Removed: Unaudited Results for the Three Months Ended November 30, 2024, and 2023
+Added: Unaudited Results for the Three Months Ended February 28, 2025, and February 29, 2024
Sales and Revenue
−Removed: For the three-month period ended November 30, 2024, the Company reported revenue of USD $1,175,060, a significant increase of 3,157% compared to $36,082 in the same period in 2023.
−Removed: This remarkable growth reflects the successful launch of the Devvstream contract, which contributed significantly to the Company’s revenue.
−Removed: Additionally, revenue streams from app subscriptions and carbon credits demonstrated steady growth during the quarter.
−Removed: Cost of Sales
−Removed: For the three months ended November 30, 2024, cost of sales was $644,237, compared to $13,652 for the same period in 2023.
−Removed: This significant increase corresponds to the Company’s expansion of sales volume and business activities during the current period.
+Added: For the three-month period ended February 28, 2025, the Company reported revenue of USD $238,528, a decrease of 4% compared to $247,222 in the same period in 2024.
+Added: The slight decline in sales was primarily due to fluctuations in pricing.
Operating Expenses
−Removed: Operating expenses for the three-month period ended November 30, 2024, were $1,735,881, compared to $303,357 in the same period in 2023, representing a 472% increase.
+Added: Operating expenses for the three-month period ended February 28, 2025, were $1,821,772, compared to $394,863 in the same period in 2024, representing a 361% increase.
The key factors driving this increase were:
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Net Loss from Operations
−Removed: The operating loss for the three-month period ended November 30, 2024, was $(1,205,058), compared to $(280,927) in the same period in 2023.
−Removed: While revenue showed significant growth, increased operating expenses offset these gains, as the Company continues to invest heavily in marketing, payroll, and compliance to drive long-term growth.
−Removed: Unaudited Results for the Six Months Ended November 30, 2024 and 2023
+Added: The operating loss for the three-month period ended February 28, 2025, was $(1,681,096), compared to $(371,399) in the same period in 2024.
+Added: While revenue was stable, increased operating expenses offset these gains, as the Company continues to invest heavily in marketing, payroll, and compliance to drive long-term growth.
+Added: Unaudited Results for the Nine Months Ended February 28, 2025 and February 29, 2024
Sales and Revenue
−Removed: For the six-month period ended November 30, 2024, the Company reported revenue of USD $1,302,489, a significant increase of 3,169% compared to USD $39,840 during the same period in 2023.
+Added: For the nine-month period ended February 28, 2025, the Company reported revenue of USD $1,530,349, a significant increase of 433% compared to USD $287,062 during the same period in 2024.
This remarkable growth was driven by the successful launch of the Devvstream contract, which contributed substantially to the Company's revenue base and is expected to generate ongoing deferred revenue streams in future quarters.
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Moving forward, the Company anticipates further revenue growth from the expansion of its app and new partnerships under development.
−Removed: Cost of Sales
−Removed: For the six months ended November 30, 2024, cost of sales totaled $738,335, compared to $14,201 for the same period in 2023.
−Removed: The higher cost of sales aligns with the increase in revenue, driven by the Company's growth in operational scale and fulfillment of customer contracts.
−Removed: The cost of sales as a percentage of revenue remains consistent with expectations for the expanded product and service offerings.
Operating Expenses
−Removed: Operating expenses for the six-month period ended November 30, 2024, totaled $2,561,565, compared to $628,830 in the same period in 2023, marking a 307% increase.
+Added: Operating expenses for the nine-month period ended February 28, 2025, totaled $4,412,366, compared to $1,023,694 in the same period in 2024, marking a 361% increase.
The significant increase in operating expenses reflects the Company’s continued investment in scaling operations and market presence.
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Net Loss from Operations
−Removed: For the six-month period ended November 30, 2024, the Company recorded an operating loss of $(1,997,411) compared to $(603,191) for the same period in 2023, representing a 231% increase.
+Added: For the nine-month period ended February 28, 2025, the Company recorded an operating loss of $(3,652,837) compared to $(2,163,366) for the same period in 2024, representing a 69% increase.
Despite the significant growth in revenue, the increase in operating expenses driven by marketing, payroll, and professional services contributed to the expansion of operating losses.
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The following table sets forth the major components of our statements and consolidated statements of cash flows for the periods presented.
+Added: Nine months ended February 28, 2025
+Added: Nine months ended February 29, 2024
Cash used in operating activities
−Removed: $ (3,364,533 )
Cash used in investing activities
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Cash, end of period
−Removed: As of November 30, 2024, the Company had USD $5,806,188 in current assets
−Removed: To date, the Company has financed its operations through equity sales and convertible notes.
+Added: As of February 28, 2025, the Company had USD $6,308,450 in current assets
+Added: To date, the Company has financed its operations through equity sales.
During July – September 2023, Karbon-X Corp.
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Recent Developments
−Removed: During the six months ended November 30, 2024, the Company strengthened its executive leadership team with the appointment of key hires.
+Added: During the nine months ended February 28, 2025, the Company strengthened its executive leadership team with the appointment of key hires.
Christopher Mulgrew, a seasoned financial executive with over 24 years of experience, joined the Company as Chief Financial Officer (CFO).
In this role, he will oversee the Company’s financial strategy, reporting, and compliance functions, contributing to enhanced financial management and planning as the Company continues its growth trajectory.
−Removed: These appointments reflect our commitment to building a strong leadership team as we continue to execute on our strategic priorities and drive value for shareholders.
+Added: This appointment reflect our commitment to building a strong leadership team as we continue to execute on our strategic priorities and drive value for shareholders.
Future Financing
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Capital Expenditures
−Removed: As of November 30, 2024, we had no capital expenditures.
+Added: As of February 28, 2025, we had no capital expenditures.
Commitments and Contractual Obligations
−Removed: As of November 30, 2024, Karbon-X has entered into a forward purchase agreement for the acquisition of 24,100 verified carbon credits at a fixed price of $120 per credit.
−Removed: The agreement requires the delivery of credits on a quarterly schedule beginning in Q2 2025 and continuing through Q1 2029.
−Removed: The total contractual commitment under this agreement amounts to $2,892,000.
−Removed: Payment obligations are fulfilled through the issuance of shares upon execution of the agreement.
−Removed: The Company is required to deliver the credits as per the agreed schedule, with penalties applicable for non-delivery.
−Removed: These commitments are expected to support the Company’s ongoing environmental initiatives and operational goals.
+Added: As a "smaller reporting company" as defined by Item 10 of Regulation S-K, the Company is not required to provide this information.
Off-Balance Sheet Arrangements
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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.