Core Insights - NextTrip, Inc. has launched Travel Magazine 2.0, a digital editorial platform aimed at enhancing the travel booking experience by guiding users from inspiration to booking [1] Company Developments - The new platform is part of NextTrip's strategy to build a vertically integrated travel-media ecosystem, showcasing the company's commitment to leveraging technology in the travel industry [1] Industry Impact - The introduction of Travel Magazine 2.0 signifies a shift in how travel companies can utilize digital platforms to convert consumer interest into actual travel bookings, potentially influencing industry standards [1]

[PART I - FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) This section presents NextTrip, Inc.'s unaudited condensed consolidated financial statements and management's discussion for the period ended May 31, 2025 [ITEM 1. FINANCIAL STATEMENTS](index=3&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) This section presents NextTrip, Inc.'s unaudited condensed consolidated financial statements, highlighting increased net loss, worsening working capital, and a going concern warning [Condensed Consolidated Balance Sheets](index=4&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) This section details NextTrip's financial position, showing a significant decrease in cash and a worsening working capital deficit as of May 31, 2025 Condensed Consolidated Balance Sheet Highlights (May 31, 2025 vs. February 28, 2025) | Metric | May 31, 2025 Amount ($) | February 28, 2025 Amount ($) | Change Amount ($) | % Change | | :----------------------------- | :----------- | :---------------- | :------- | :------- | | Cash and cash equivalents | $130,906 | $1,062,367 | $(931,461) | -87.68% | | Total Current Assets | $1,557,075 | $2,465,509 | $(908,434) | -36.85% | | Total Assets | $10,955,216 | $9,936,153 | $1,019,063 | 10.26% | | Total Current Liabilities | $2,699,966 | $2,571,086 | $128,880 | 5.01% | | Total Non-Current Liabilities | $1,585,332 | $- | $1,585,332 | N/A | | Total Liabilities | $4,285,298 | $2,571,086 | $1,714,212 | 66.67% | | Accumulated deficit | $(38,871,518)| $(34,349,823) | $(4,521,695) | 13.16% | | Total Stockholders' Equity | $6,669,918 | $7,365,067 | $(695,149) | -9.44% | - The company's working capital deficit significantly worsened from **$(105,577)** as of February 28, 2025, to **$(1,142,891)** as of May 31, 2025[30](index=30&type=chunk)[284](index=284&type=chunk) [Condensed Consolidated Statements of Operations](index=5&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) This section outlines NextTrip's financial performance, reporting a substantial increase in net loss and operating expenses despite a revenue decline Condensed Consolidated Statements of Operations Highlights (Three Months Ended May 31, 2025 vs. 2024) | Metric | May 31, 2025 Amount ($) | May 31, 2024 Amount ($) | Change Amount ($) | % Change | | :------------------------------------ | :----------- | :----------- | :------- | :------- | | Revenue | $138,827 | $188,793 | $(49,966) | -26.47% | | Cost of revenue | $(99,921) | $(173,581) | $73,660 | -42.44% | | Gross profit | $38,906 | $15,212 | $23,694 | 155.76% | | Total Operating Expenses | $4,678,643 | $1,967,613 | $2,711,030 | 137.79% | | Operating Loss | $(4,639,737) | $(1,952,401) | $(2,687,336) | 137.64% | | Net loss from continuing operations | $(4,457,232) | $(1,987,626) | $(2,469,606) | 124.25% | | Net Loss Applicable to Common Stockholders | $(4,521,695) | $(1,989,405) | $(2,532,290) | 127.29% | | Basic and diluted loss per common share | $(0.68) | $(1.55) | $0.87 | -56.13% | | Weighted average number of common shares | 6,585,197 Shares | 1,279,165 Shares | 5,306,032 Shares | 414.81% | - The decrease in revenue was primarily due to limited marketing expenditures resulting from cash flow constraints[265](index=265&type=chunk) - The significant increase in total operating expenses was primarily attributable to stock options granted to the board of directors and an increase in professional services expenses[267](index=267&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity (Deficit)](index=6&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20STOCKHOLDERS'%20EQUITY%20(DEFICIT)) This section details changes in stockholders' equity, reflecting the impact of net loss, preferred stock dividends, and various stock issuances Changes in Stockholders' Equity (Three Months Ended May 31, 2025) | Item | Preferred Stock (Shares) | Preferred Stock Amount ($) | Common Stock (Shares) | Common Stock Amount ($) | Additional Paid-in Capital Amount ($) | Accumulated Deficit Amount ($) | Total Amount ($) | | :------------------------------------ | :----------------------- | :------------------ | :-------------------- | :--------------- | :----------------------------- | :---------------------- | :---------- | | Balances, February 28, 2025 | 3,106,616 | $3,107 | 1,656,738 | $1,657 | $41,710,126 | $(34,349,823) | $7,365,067 | | Net Loss | - | - | - | - | - | $(4,457,232) | $(4,457,232)| | Preferred Stock Dividends | - | - | 45,643 | $46 | $64,417 | $(64,463) | - | | Preferred Shares Issued (FSA Travel) | 282,258 | $282 | - | - | $875,359 | - | $875,641 | | Common Shares Issued (Journy.tv) | - | - | 20,000 | $20 | $115,180 | - | $115,200 | | Common Shares Issued (Sigma reverse acquisition) | - | - | 5,843,993 | $5,844 | $(5,844) | - | - | | Common Shares Issued for services | - | - | 125,000 | $125 | $476,075 | - | $472,200 | | Warrants issued (debt conversion) | - | - | - | - | $30,775 | - | $30,775 | | Warrants issued (bridge loan) | - | - | - | - | $177,398 | - | $177,398 | | Securities for directors' services | - | - | - | - | $1,948,544 | - | $1,948,544 | | Stock Options Issued to Employees | - | - | - | - | $138,325 | - | $138,325 | | Balances, May 31, 2025 | 3,388,874 | $3,389 | 7,691,374 | $7,692 | $45,530,355 | $(38,871,518) | $6,669,918 | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) This section presents NextTrip's cash flow activities, showing increased cash used in investing and provided by financing, with a net decrease in cash Condensed Consolidated Statements of Cash Flows Highlights (Three Months Ended May 31, 2025 vs. 2024) | Cash Flow Activity | May 31, 2025 Amount ($) | May 31, 2024 Amount ($) | Change Amount ($) | % Change | | :------------------------------------ | :----------- | :----------- | :------- | :------- | | Net Cash Used in Operating Activities | $(1,042,658) | $(1,142,311) | $99,653 | -8.72% | | Net Cash Used in Investing Activities | $(1,281,503) | $(169,406) | $(1,112,097) | 656.47% | | Net Cash Provided by Financing Activities | $1,392,700 | $1,024,591 | $368,109 | 35.93% | | Net Change in Cash for Period | $(931,461) | $(287,126) | $(644,335) | 224.39% | | Cash at End of Period | $130,906 | $36,679 | $94,227 | 256.90% | - Net cash used in investing activities significantly increased due to the acquisition of FSA Travel, LLC (**$900,000**) and the Journy.tv asset purchase (**$300,000**)[296](index=296&type=chunk) - Net cash provided by financing activities increased primarily due to higher advances from related parties and an increase in notes payable to investors[297](index=297&type=chunk)[298](index=298&type=chunk) [NOTE 1 - Business Description and Going Concern](index=8&type=section&id=NOTE%201%20-%20Business%20Description%20and%20Going%20Concern) This note describes NextTrip's business and highlights a significant accumulated deficit and working capital deficit, raising going concern doubts - NextTrip, Inc. (formerly Sigma Additive Solutions, Inc.) changed its name on March 13, 2024, following a reverse acquisition where NextTrip Holdings, Inc. (NTH) was treated as the accounting acquirer[22](index=22&type=chunk)[26](index=26&type=chunk)[27](index=27&type=chunk) - The company provides travel technology solutions with a primary emphasis on hotels, air, and all-inclusive travel packages through its proprietary booking engine, NextTrip 2.0[24](index=24&type=chunk) - As of May 31, 2025, the company had an accumulated deficit of **$38,871,518** and a working capital deficit of **$1,142,891**, raising substantial doubt about its ability to continue as a going concern for the next 12 months[30](index=30&type=chunk)[31](index=31&type=chunk) [NOTE 2 – Summary of Significant Accounting Policies](index=9&type=section&id=NOTE%202%20%E2%80%93%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines NextTrip's key accounting principles, including revenue recognition, segment reporting, and common shares underlying instruments - The financial statements are prepared in accordance with GAAP on a consolidated basis, with intercompany transactions eliminated. Certain information is condensed or omitted, and should be read in conjunction with the annual 10-K[32](index=32&type=chunk) - Revenue is recognized when the customer has purchased the product, the travel/cancellation date has passed, the sales price is fixed, and collectability is assured. Revenue for direct customer travel packages is recorded gross[47](index=47&type=chunk) - The company manages its business as one reportable segment: Travel Products and Services, with the CEO acting as the Chief Operating Decision Maker[49](index=49&type=chunk)[50](index=50&type=chunk) Common Shares Underlying Instruments (May 31, 2025 vs. 2024) | Instrument | May 31, 2025 Shares | May 31, 2024 Shares | | :----------- | :----------- | :----------- | | Warrants | 3,112,772 | 484,063 | | Stock Options| 556,250 | 79,560 | | Preferred Stock| 3,391,974 | 66,385 | | Total | 7,060,996 | 630,008 | [NOTE 3 - Investment in Equity Securities](index=13&type=section&id=NOTE%203%20-%20Investment%20in%20Equity%20Securities) This note details NextTrip's 10% equity investment in Blue Fysh Holdings Inc., accounted for under the cost method - On February 24, 2025, the Company acquired a **10%** ownership interest in Blue Fysh Holdings Inc. by issuing **483,000** shares of Series N Preferred Stock, valued at **$2,415,000**[52](index=52&type=chunk) - This investment is accounted for under the cost method as the Company does not have significant influence over Blue Fysh, and will be assessed for impairment in future periods[53](index=53&type=chunk)[54](index=54&type=chunk) [NOTE 4 – Acquisition of FSA Travel, LLC](index=14&type=section&id=NOTE%204%20%E2%80%93%20Acquisition%20of%20FSA%20Travel%2C%20LLC) This note describes NextTrip's acquisition of the remaining 51% interest in FSA Travel, LLC, making it a wholly-owned subsidiary - On April 9, 2025, NextTrip acquired the remaining **51%** interest in FSA Travel, LLC for **$1.0 million** (**$0.5 million** cash, **$0.5 million** Series O Preferred shares), making FSA a wholly-owned subsidiary. This followed an initial **49%** acquisition on February 6, 2025[56](index=56&type=chunk)[57](index=57&type=chunk)[59](index=59&type=chunk) - An additional **$0.8 million** in contingent consideration (cash and Series O Preferred stock) was paid on April 28, 2025, upon achievement of business milestones[57](index=57&type=chunk)[255](index=255&type=chunk) FSA Travel, LLC Acquisition Purchase Price Allocation | Item | Amount ($) | | :----------------------------- | :----------- | | **Consideration paid:** | | | Cash | 500,000 | | Series O Preferred stock | 500,000 | | Earnout Payment | 800,000 | | Fair value of Initial Purchase | 981,303 | | **Total consideration** | **2,781,303**| | **Assets acquired:** | | | Cash and cash equivalents | 471,660 | | Accounts receivable | 13,460 | | Intangibles | 960,000 | | Goodwill | 1,669,058 | | **Total assets** | **3,114,178**| | **Liabilities assumed:** | | | Accounts payable | 12,474 | | Due to FSA Unitholders | 221,481 | | SBA Loan | 98,920 | | **Total liabilities** | **332,875** | | **Total net assets** | **2,781,303**| [NOTE 5 – Journy.tv Asset Acquisition](index=15&type=section&id=NOTE%205%20%E2%80%93%20Journy.tv%20Asset%20Acquisition) This note details NextTrip's acquisition of Journy.tv assets, accounted for as an asset purchase rather than a business combination - On April 1, 2025, the Company acquired assets related to Ovation LLC's Journy.tv business, including trademarks, domains, and apps, for **$300,000** cash and **20,000** restricted shares of common stock (total consideration **$415,200**)[63](index=63&type=chunk)[64](index=64&type=chunk) - The transaction was accounted for as an asset acquisition, not a business combination, due to the significant rebranding and redevelopment required for the acquired assets to generate revenue, and the absence of an organized workforce[66](index=66&type=chunk) - The fair value of the acquired intangible assets was **$415,200**, with a weighted average estimated useful life of **16.7 years**[67](index=67&type=chunk) [NOTE 6 – Intangible Assets](index=16&type=section&id=NOTE%206%20%E2%80%93%20Intangible%20Assets) This note provides a breakdown of NextTrip's intangible assets, net, and related amortization expense for the period Intangible Assets, Net (May 31, 2025 vs. February 28, 2025) | Intangible Asset | May 31, 2025 Amount ($) | February 28, 2025 Amount ($) | | :----------------------------- | :----------- | :---------------- | | Software Development | $7,089,049 | $7,267,778 | | Software Licenses | $645,306 | $789,576 | | Trademark | $6,283 | $6,283 | | FSA Travel, LLC Tradename | $280,000 | $- | | Journy.tv – Trade Name | $138,400 | $- | | Journy.tv Distribution Agreements | $276,800 | $- | | Total | $8,435,838 | $8,063,637 | | Accumulated amortization | $(5,056,789) | $(5,936,269) | | **Intangible assets, net** | **$3,379,049** | **$2,127,368** | - Amortization expense for the three months ended May 31, 2025, was **$206,021**, a decrease from **$286,237** in the same period of 2024, primarily due to an increase in fully amortized intangible assets[68](index=68&type=chunk)[277](index=277&type=chunk) [NOTE 7 – Goodwill](index=16&type=section&id=NOTE%207%20%E2%80%93%20Goodwill) This note explains the goodwill recognized from the reverse acquisition of Sigma and the acquisition of FSA Travel, LLC - Goodwill of **$1,167,805** resulted from the reverse acquisition of Sigma Additive Solutions, Inc. by NextTrip Holdings, Inc., primarily reflecting NTH's objective to access public markets for funding[71](index=71&type=chunk)[72](index=72&type=chunk) - Preliminary goodwill of **$1,669,058** was recognized from the FSA Travel, LLC acquisition as of May 31, 2025, representing synergies and the value of unacquired/undeveloped assets[73](index=73&type=chunk)[61](index=61&type=chunk) [NOTE 8 – Notes Payable](index=17&type=section&id=NOTE%208%20%E2%80%93%20Notes%20Payable) This note details NextTrip's various short-term promissory notes outstanding, including terms and interest rates - The company has several short-term promissory notes outstanding, including a **$100,000** note (**7.5%** interest, extended maturity), a **$40,000** note (**7.5%** interest, due June 25, 2025), and multiple notes from 1800 Diagonal Lending LLC with OID and **13%** interest[74](index=74&type=chunk)[75](index=75&type=chunk)[76](index=76&type=chunk)[77](index=77&type=chunk)[79](index=79&type=chunk) - A **$220,000** promissory note issued on December 31, 2024, included a **15%** guaranteed interest paid in Series K Preferred shares and warrants to purchase **220,000** common shares[78](index=78&type=chunk) - On April 1, 2025, the company sold a **$360,000** promissory note (with **$60,000** OID and **10%** interest) and warrants to Alumni Capital LP for **$300,000**, which was repaid on July 1, 2025[80](index=80&type=chunk)[81](index=81&type=chunk)[198](index=198&type=chunk)[286](index=286&type=chunk) [NOTE 9 – Long-Term Debt](index=18&type=section&id=NOTE%209%20%E2%80%93%20Long-Term%20Debt) This note describes the SBA loan assumed as part of the FSA acquisition, including its principal, interest rate, and fair value - As part of the FSA acquisition on April 9, 2025, the Company assumed an SBA loan with an initial principal of **$50,500** (modified to **$199,100**), bearing **3.75%** interest and maturing December 4, 2050[83](index=83&type=chunk) - The assumed loan was recognized at its acquisition-date fair value of **$98,920**, reflecting a market-based effective interest rate of approximately **12.03%** per annum[84](index=84&type=chunk)[85](index=85&type=chunk) [NOTE 10 - Related Party Transactions](index=18&type=section&id=NOTE%2010%20-%20Related%20Party%20Transactions) This note outlines NextTrip's transactions with related parties, including promissory notes and a revolving line of credit - On April 9, 2025, NTH entered into two promissory notes totaling **$645,000** with the Donald P. Monaco Insurance Trust (Chairman Donald Monaco is trustee)[86](index=86&type=chunk)[287](index=287&type=chunk) - On May 6, 2025, the Company secured a **$3,000,000** revolving Line of Credit Agreement with Monaco Investment Partners II, LP (controlled by Mr. Monaco), bearing **12%** simple interest[87](index=87&type=chunk)[288](index=288&type=chunk) - An initial advance of **$1,045,000** from the MIP Line of Credit was used to repay the Trust Notes and a previous cash advance. Total outstanding principal under this line was **$1,486,575** as of May 31, 2025, increasing to **$2,186,575** by July 10, 2025[88](index=88&type=chunk)[289](index=289&type=chunk) - Total amounts due to related parties increased significantly from **$61,526** at February 28, 2025, to **$1,494,191** at May 31, 2025[89](index=89&type=chunk) [NOTE 11 - Stockholders' Equity](index=18&type=section&id=NOTE%2011%20-%20Stockholders'%20Equity) This note details changes in NextTrip's common and preferred stock, including issuances and stock-based compensation expense - As of May 31, 2025, there were **7,691,374** shares of common stock outstanding, a significant increase from **1,656,738** shares at February 28, 2025, primarily due to the issuance of **5,843,993** contingent shares for the NextTrip Acquisition[90](index=90&type=chunk)[92](index=92&type=chunk) - The company has **3,388,874** shares of preferred stock outstanding as of May 31, 2025, across various series (E, H, I, J, K, L, M, N, O, P), many of which are nonvoting and convertible into common stock upon stockholder approval[95](index=95&type=chunk)[97](index=97&type=chunk)[114](index=114&type=chunk)[126](index=126&type=chunk)[133](index=133&type=chunk)[140](index=140&type=chunk)[149](index=149&type=chunk)[159](index=159&type=chunk)[167](index=167&type=chunk)[175](index=175&type=chunk)[182](index=182&type=chunk) - Total stock-based compensation expense for the three months ended May 31, 2025, was **$138,325**, a substantial increase from **$16,394** in the prior year, mainly due to a fully vested option grant to an employee[187](index=187&type=chunk)[269](index=269&type=chunk) - All outstanding unvested Stock Appreciation Rights (SARs) became immediately vested and exercisable on March 26, 2025, upon the change in control from the NextTrip Acquisition[192](index=192&type=chunk) [NOTE 12 - Subsequent Events](index=32&type=section&id=NOTE%2012%20-%20Subsequent%20Events) This note reports on significant events occurring after the reporting period, including the repayment of the Alumni Note - On July 1, 2025, the Company fully repaid the Alumni Note, including principal, discount, and accrued interest, terminating all obligations under the note[198](index=198&type=chunk) [ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=29&type=section&id=ITEM%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) This section provides management's perspective on NextTrip's financial condition and operational results, highlighting increased net loss and liquidity challenges [Forward-looking statements](index=34&type=section&id=Forward-looking%20statements) This section notes the presence of forward-looking statements in the report, which are subject to inherent risks and uncertainties - The report contains forward-looking statements regarding future operations, product development, and financial performance, which are subject to inherent risks and uncertainties[199](index=199&type=chunk) [Corporation Information](index=34&type=section&id=Corporation%20Information) This section provides background on NextTrip, Inc., including its name change and core business as a travel technology provider - NextTrip, Inc. was formerly Sigma Additive Solutions, Inc., changing its name on March 13, 2024. The company provides travel technology solutions with a focus on hotels, air, and all-inclusive travel packages through its NextTrip 2.0 booking engine[200](index=200&type=chunk)[201](index=201&type=chunk)[202](index=202&type=chunk) [Reverse Acquisition](index=35&type=section&id=Reverse%20Acquisition) This section details the reverse acquisition of Sigma by NextTrip Holdings, Inc., and the subsequent issuance of contingent shares - The NextTrip Acquisition, where Sigma acquired NextTrip Holdings, Inc. (NTH) on December 29, 2023, was a reverse acquisition, making NTH the accounting acquirer[204](index=204&type=chunk) NextTrip Acquisition Milestone Events and Contingent Shares | Milestone Event | Date Earned | Contingent Shares | Status as of Report Date | | :------------------------------------------------ | :---------- | :---------------- | :----------------------- | | Launch of NTH's leisure travel booking platform | Achieved | 1,450,000 Shares | Achieved | | Launch of NTH's group travel booking platform | Achieved | 1,450,000 Shares | Achieved | | Launch of NTH's Travel Agent Platform | Achieved | 1,450,000 Shares | Achieved | | Commercial launch of PayDlay technology in NXT2.0 | Achieved | 1,650,000 Shares | Achieved | - All four business milestones for the NextTrip Acquisition were achieved, leading to the issuance of **4,393,993** contingent shares on March 26, 2025, and the remaining **1,450,000** contingent shares on May 5, 2025[213](index=213&type=chunk) - The issuance of contingent shares resulted in a change of control, and new directors were appointed to the Board effective July 28, 2025, as per Board Appointment Rights[208](index=208&type=chunk)[214](index=214&type=chunk) [Critical Accounting Policies and Estimates](index=37&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section outlines NextTrip's key accounting estimates, including revenue recognition, asset impairment, and stock compensation - Key accounting estimates include revenue recognition, impairment of long-lived assets, stock compensation awards, and allowance for bad debts. Management believes no alternative accounting methods would materially affect financial statements[215](index=215&type=chunk)[216](index=216&type=chunk) - The company established a full allowance for credit losses of **$2,567,665** for a promissory note receivable from NextPlay Technologies, Inc., due to NextPlay's involuntary bankruptcy proceedings and uncertain collectability[222](index=222&type=chunk)[224](index=224&type=chunk) [Business Overview](index=38&type=section&id=Business%20Overview) This section describes NextTrip's business as an early-stage, technology-driven travel company developing an integrated booking and media platform - NextTrip is an early-stage, technology-driven travel company developing an integrated travel booking and media platform (NXT2.0) for leisure, group, and business travelers[225](index=225&type=chunk) - The NXT2.0 platform offers extensive inventory, specialty features like Groups Platform and Travel Agent Platform, and a delayed payment option (PayDlay)[225](index=225&type=chunk)[227](index=227&type=chunk)[232](index=232&type=chunk) - Complementing the booking engine are media properties (Journy.tv, Compass.tv, Travel Magazine) intended to drive high-intention traffic and generate advertising revenue[225](index=225&type=chunk)[234](index=234&type=chunk)[235](index=235&type=chunk) - Future developments include an AI-powered travel assistant, a multi-level Rewards program, and group chat features to enhance user engagement and loyalty[233](index=233&type=chunk) [Revenue Strategy and Development of an Integrated Travel and Media Ecosystem](index=41&type=section&id=Revenue%20Strategy%20and%20Development%20of%20an%20Integrated%20Travel%20and%20Media%20Ecosystem) This section details NextTrip's revenue generation strategy through travel bookings and advertising, emphasizing the need for additional funding - Revenue is generated through travel bookings (commissions or direct negotiated contracts) and advertising revenue from media platforms[238](index=238&type=chunk)[240](index=240&type=chunk) - Directly negotiated contracts offer higher margins and pricing control compared to commission-based sales[240](index=240&type=chunk)[242](index=242&type=chunk) - The media division aims to drive advertising rates for third parties and promote NextTrip's own travel offerings, reducing external marketing expenditures[245](index=245&type=chunk) - The company is in early stages of development and requires a minimum of **$5.5 million** in additional funding to support marketing, product development, and achieve accelerated growth by focusing on underserved travel sectors[247](index=247&type=chunk)[248](index=248&type=chunk)[250](index=250&type=chunk)[291](index=291&type=chunk) [Recent Developments](index=43&type=section&id=Recent%20Developments) This section highlights NextTrip's recent strategic initiatives, including acquisitions, partnerships, and new product launches - Acquired FSA Travel, LLC (Five Star Alliance) in a step acquisition, gaining a curated portfolio of over **5,000** luxury hotel properties and strengthening luxury and cruise offerings[230](index=230&type=chunk)[252](index=252&type=chunk)[254](index=254&type=chunk) - Entered a share exchange agreement with Blue Fysh Holdings Inc., acquiring a **10%** interest to expand business opportunities and leverage Blue Fysh's digital OOH solutions for increased advertising revenue and brand awareness[256](index=256&type=chunk)[241](index=241&type=chunk) - Acquired Journy.tv assets, including trademarks and distribution agreements, and entered a license agreement for FAST and Video On Demand content, aiming to integrate travel content with booking technology[257](index=257&type=chunk)[258](index=258&type=chunk)[259](index=259&type=chunk) - Formed a strategic partnership with Intimate Hotels of Barbados (IHB) to serve as their official booking engine[261](index=261&type=chunk) - Launched NextTrip Cruise, a fully integrated booking engine offering access to over **10,000** sailings and **35** cruise partners[262](index=262&type=chunk) - The Board of Directors increased from five to seven members, and new directors were appointed effective July 17 and July 28, 2025, including CEO William Kerby and NTH Appointees[263](index=263&type=chunk)[264](index=264&type=chunk) [Results of Operations](index=46&type=section&id=Results%20of%20Operations) This section analyzes NextTrip's operational performance, focusing on changes in revenue, cost of revenue, and various operating expenses Key Operating Expense Changes (Three Months Ended May 31, 2025 vs. 2024) | Expense Category | May 31, 2025 Amount ($) | May 31, 2024 Amount ($) | Change Amount ($) | % Change | | :----------------------------- | :----------- | :----------- | :------- | :------- | | Revenue | $138,827 | $188,793 | $(49,965) | -27% | | Cost of revenue | $99,921 | $173,581 | $(73,660) | -42% | | Total Operating Expenses | $4,678,643 | $1,967,613 | $2,711,030 | 138% | | Salaries and benefits | $696,914 | $626,752 | $70,162 | 11% | | Stock based compensation | $138,325 | $16,394 | $121,931 | 744% | | Sales and marketing | $90,035 | $156,188 | $(66,153) | -42% | | Professional service fees | $1,149,476 | $523,873 | $625,603 | 119% | | Technology | $321,815 | $184,669 | $137,146 | 74% | | Organization costs | $1,999,670 | $28,737 | $1,970,933 | 6859% | | Depreciation and amortization | $206,650 | $287,586 | $(80,936) | -28% | | Net loss from continuing operations | $(4,457,232) | $(1,987,626) | $(2,469,606) | 124% | | Net Loss Applicable to Common Stockholders | $(4,521,695) | $(1,989,405) | $(2,532,290) | 127% | - The significant increase in organizational costs was primarily due to fully vested stock options issued to directors during the quarter[275](index=275&type=chunk) - Net other income increased due to a settlement agreement related to the NextPlay Technologies, Inc. promissory note receivable, partially offset by a loss on extinguishment of debt and increased interest expense[279](index=279&type=chunk) [Liquidity and Capital Resources](index=48&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses NextTrip's financial liquidity, highlighting its cash position, working capital deficit, and ongoing need for financing - As of May 31, 2025, the company had **$130,906** in cash and a working capital deficit of **$1,142,891**, indicating substantial doubt about its ability to continue as a going concern for the next 12 months[284](index=284&type=chunk)[310](index=310&type=chunk)[311](index=311&type=chunk) - Operations have been financed primarily through short-term promissory notes, advances from related parties, and private placements of securities[285](index=285&type=chunk) - The company estimates needing a minimum of **$5.5 million** to continue operations for the next twelve months and faces risks of dilution or onerous debt terms if additional financing is secured[291](index=291&type=chunk)[292](index=292&type=chunk) Net Cash Flow Activities (Three Months Ended May 31, 2025 vs. 2024) | Cash Flow Activity | May 31, 2025 Amount ($) | May 31, 2024 Amount ($) | Change Amount ($) | | :------------------------------------ | :----------- | :----------- | :------- | | Net Cash Used in Operating Activities | $(1,042,658) | $(1,151,220) | $108,562 | | Net Cash Used in Investing Activities | $(1,281,503) | $(169,406) | $(1,112,097) | | Net Cash Provided by Financing Activities | $1,392,700 | $1,024,591 | $368,109 | [ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=51&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company states that this item is not applicable, indicating no material quantitative or qualitative disclosures regarding market risk are required for the reporting period - This item is not applicable for the reporting period[303](index=303&type=chunk) [ITEM 4. CONTROLS AND PROCEDURES](index=51&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) The company's management concluded that disclosure controls and procedures were effective as of May 31, 2025, with no material changes in internal control - Disclosure controls and procedures were evaluated and deemed effective as of May 31, 2025[305](index=305&type=chunk) - No changes in internal control over financial reporting materially affected or are reasonably likely to materially affect internal control during the period[306](index=306&type=chunk) - Management acknowledges that control systems provide only reasonable, not absolute, assurance and have inherent limitations[307](index=307&type=chunk) [PART II - OTHER INFORMATION](index=52&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) This section provides additional information beyond the financial statements, including legal proceedings, risk factors, and equity sales [ITEM 1. LEGAL PROCEEDINGS](index=52&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) The company states that there are no legal proceedings to report for the period - This item is not applicable for the reporting period[309](index=309&type=chunk) [ITEM 1A. RISK FACTORS](index=52&type=section&id=ITEM%201A.%20RISK%20FACTORS) The company reiterates and updates its risk factors, emphasizing the substantial doubt about its ability to continue as a going concern due to insufficient cash and working capital deficit - As of May 31, 2025, the company had **$130,906** in cash and a working capital deficit of **$1,142,891**, which is insufficient to fund anticipated operating costs[310](index=310&type=chunk) - There is substantial doubt about the company's ability to continue as a going concern for **12 months** from the filing date, necessitating additional financing[310](index=310&type=chunk)[311](index=311&type=chunk) - Future financing, if obtained, may be highly dilutive to existing stockholders (equity) or include difficult-to-meet covenants and repayment obligations (debt)[310](index=310&type=chunk) [ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.](index=52&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS.) The company reported unregistered sales of equity securities, including common stock issued as a finder's fee for the FSA acquisition and for consulting services related to a new FAST channel, relying on Section 4(a)(2) and/or Regulation D exemptions - On May 7, 2025, **5,000** restricted shares of common stock were issued as a finder's fee for the FSA acquisition[311](index=311&type=chunk) - On May 13, 2025, **15,000** restricted shares of common stock were issued for consulting services related to the development and launch of a beauty and wellness FAST channel[312](index=312&type=chunk) - These securities were issued in transactions exempt from registration under Section 4(a)(2) and/or Regulation D of the Securities Act of 1933[313](index=313&type=chunk) [ITEM 3. DEFAULTS UPON SENIOR SECURITIES](index=52&type=section&id=ITEM%203.%20DEFAULTS%20UPON%20SENIOR%20SECURITIES) The company states that there are no defaults upon senior securities to report for the period - This item is not applicable for the reporting period[314](index=314&type=chunk) [ITEM 4. MINE SAFETY DISCLOSURES](index=52&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) The company states that this item is not applicable, as it is not involved in mining operations - This item is not applicable for the reporting period[315](index=315&type=chunk) [ITEM 5. OTHER INFORMATION](index=52&type=section&id=ITEM%205.%20OTHER%20INFORMATION) The company reported that none of its directors or officers entered into, modified, or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the three months ended May 31, 2025 - No directors or officers entered into, modified, or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the three months ended May 31, 2025[316](index=316&type=chunk) [ITEM 6. EXHIBITS](index=53&type=section&id=ITEM%206.%20EXHIBITS) This section lists all exhibits filed with the Form 10-Q, including various agreements, certificates of designation for preferred stock, and warrants, many of which are incorporated by reference from previous SEC filings - The exhibits include Share Exchange Agreements, Membership Interest Purchase Agreements, Asset Purchase Agreements, Certificates of Designation for various series of Preferred Stock, and numerous Warrant agreements[317](index=317&type=chunk)[318](index=318&type=chunk)[319](index=319&type=chunk) [SIGNATURES](index=56&type=section&id=SIGNATURES) The report is duly signed on behalf of NextTrip, Inc. by William Kerby, Chief Executive Officer, and Frank Orzechowski, Chief Financial Officer and Treasurer, on July 15, 2025 - The report was signed by William Kerby, Chief Executive Officer, and Frank Orzechowski, Chief Financial Officer and Treasurer, on July 15, 2025[323](index=323&type=chunk)

Revenue and Financial Performance - The company generated nominal revenues primarily from leisure travel bookings, including airline tickets, hotel rooms, and cruises [201]. - Revenue for the year ended February 28, 2025, was $501,423, an increase of $42,671 or 9% compared to $458,752 in 2024 [239]. - Cost of revenue increased by $100,589 or 25% to $498,121 for the year ended February 28, 2025, compared to $397,532 in 2024 [240]. - Operating expenses totaled $7,416,731, an increase of $1,676,154 or 29% from $5,740,577 in 2024, driven by higher salaries and benefits, technology expenses, and professional service fees [241]. - Net loss from continuing operations was $10,121,038 for the year ended February 28, 2025, compared to a net loss of $6,656,837 in 2024 [253]. - Cash as of February 28, 2025, was $1,062,367, down from $323,805 in 2024, with an accumulated deficit of $34,349,823 [258]. - Net cash used in operating activities from continuing operations was $5,088,498, an increase of $32,403 or 0.6% compared to $5,056,095 in 2024 [267]. - The company estimates a minimum requirement of $5.5 million to continue operations for the next twelve months [265]. - The company has substantial doubt about its ability to continue as a going concern for 12 months from the date of filing the Annual Report [257]. Cash Flow and Investment Activities - Net cash used in investing activities for the year ended February 28, 2025, was $(1,033,751), a decrease of $2,014,687 compared to net cash provided by investing activities of $980,936 in 2024 [271]. - The primary uses of cash in investing activities for 2025 included $500,000 for purchasing a 49% interest in FSA and capitalized software development costs of $534,751 [271]. - Net cash provided by financing activities for the year ended February 28, 2025, was $6,852,467, an increase from $4,791,804 in 2024 [272]. - The financing activities in 2025 included $1,967,224 from short-term promissory notes and $2,450,000 from preferred shares issuance [272]. - Net cash provided by operating activities from discontinued operations for the year ended February 28, 2025, was $8,344, compared to net cash used of $675,314 in 2024, resulting in a total net cash used in operating activities decreasing by 11.4% to $5,080,154 [269]. - For the year ended February 29, 2024, net cash used in operating activities from continuing operations was driven by a net loss of $6,656,837, partially offset by changes in working capital of $1,400,025 and non-cash expenses of $3,000,767 [270]. Business Strategy and Operations - NextTrip's travel booking platform is powered by the proprietary NXT2.0 engine, offering extensive inventory for leisure, group, and business travelers [198]. - The company aims to integrate its Media and Travel divisions to enhance revenue streams, with advertising expected to become a key driver of higher-margin revenue [201]. - NextTrip's acquisition of Five Star Alliance provides access to over 5,000 luxury hotel properties worldwide, enhancing its luxury travel offerings [199]. - The company is in the early stages of development, with current revenue streams being small and unpredictable compared to established industry leaders [202]. - NextTrip's ambition is to build a next-generation travel solution that allows consumers to better research and explore desired travel destinations [200]. Financial Position and Risks - Trade accounts receivable balances as of February 28, 2025, and February 29, 2024, were $22,567 and $34,082, respectively [212]. - Receivables from NextPlay under the promissory note were $0 and $1,000,000 at February 28, 2025, and February 29, 2024, respectively, with an established allowance for credit losses of $2,567,665 [213]. - The company assesses impairment of intangible assets based on significant underperformance or changes in business strategy [229]. - Inflation, changing prices, and rising interest rates have had no material effect on the company's continuing operations over the last two fiscal years [273]. - The company has no off-balance sheet arrangements as defined in Item 303(a) of Regulation S-K [274]. - There are no applicable quantitative and qualitative disclosures about market risk [275]. Employee Compensation - Salaries and benefits expenses rose by $1,026,176 or 64% to $2,630,663 for the year ended February 28, 2025, compared to $1,604,487 in 2024 [242]. - Stock-based compensation decreased by $48,638 or 42% to $67,874 for the year ended February 28, 2025, from $116,512 in 2024 [243].

Acquisition and Corporate Structure - The company completed a reverse acquisition with NextTrip Holdings, Inc. on December 29, 2023, resulting in a change of control and the issuance of up to 6,000,000 shares of common stock [155][156]. - The company has not recorded any operations for its 50% owned joint venture, Next Innovation LLC, in 2023 or 2024 [154]. - A non-binding Letter of Intent was signed on November 5, 2024, to acquire Five Star Alliance, a luxury travel agency known for its curated collection of five-star hotels [187]. Revenue and Financial Performance - Revenue is primarily generated from travel bookings, including airline tickets and hotel rooms, with plans to expand into travel technology products [170]. - Revenue for the three months ended November 30, 2024, was $74,635, a decrease of $131,154, or 64%, compared to $205,789 in the same period in 2023, primarily due to reduced online marketing efforts [195]. - Revenue for the nine months ended November 30, 2024, was $417,926, a 65% increase from $253,014 in the same period in 2023, driven by the integration of Expedia into the booking engine [210]. - Net loss applicable to common stockholders for the nine months ended November 30, 2024, was $5,554,694, a 56% increase from $3,564,396 in the same period in 2023 [225]. Expenses and Cost Management - Total operating expenses increased to $1,771,411 for the three months ended November 30, 2024, an increase of $496,591, or 39%, compared to $1,274,820 in 2023, attributed to the relaunch of the NXT 2.0 booking engine and integration of Sigma Additive Solutions [198]. - Cost of revenue for the same period was $76,751, down $85,321, or 53%, from $162,072 in 2023, driven by lower sales resulting from reduced marketing efforts [197]. - Total operating expenses for the nine months ended November 30, 2024, were $5,207,359, a 55% increase from $3,397,576 in the same period in 2023 [213]. - Cost of revenue for the nine months ended November 30, 2024, was $405,788, a 99% increase from $203,524 in the same period in 2023 [212]. Marketing and Customer Engagement - The company aims to leverage interactive technology and immersive media to enhance personalized travel solutions for both leisure and business travelers [168]. - The company plans to target customers with low dollar marketing campaigns while pursuing strategic partnerships to enhance competitiveness [171]. - Marketing costs decreased to $30,529, down $111,089, or 78%, from $141,618 in the same period in 2023, primarily due to reduced online marketing expenses during Black Friday [202]. - Marketing costs increased to $238,065 for the nine months ended November 30, 2024, a 3% increase from $232,157 in the same period in 2023 [217]. Technology and Product Development - The company’s proprietary booking engine, NextTrip 2.0, provides access to approximately 3 million accommodation properties worldwide through API connections with Expedia and other suppliers [172]. - The company launched Compass.TV on October 1, 2024, featuring over a thousand hours of travel video content designed to convert viewers into customers through the NextTrip Booking Engine [189]. - The company launched FlexPay on July 11, 2024, allowing customers to pay for accommodations over time through interest-free installments, differentiating itself from other travel booking sites [194]. - The company has reactivated 12-15 contracts from Bookit.com for Phase 1 of its product launch, ensuring competitive rates in premier destinations [179]. Financial Position and Capital Needs - Cash as of November 30, 2024, was $15,385, with a working capital deficit of $(4,869,586), compared to $323,805 in cash and $(262,005) working capital deficit as of February 29, 2024 [226]. - The Company estimates needing to raise a minimum of $5.5 million in net proceeds to continue operations for the next twelve months [237]. - The Company has no lines of credit or other financing arrangements other than related party promissory notes [246]. Other Financial Metrics - An allowance for doubtful accounts of $1,567,665 was established due to NextPlay's default on a promissory note, indicating uncertainty in collectability [166]. - Preferred dividends for the nine months ended November 30, 2024, were $32,063, compared to $0 for the same period in 2023, due to dividends associated with Series E Preferred Stock [223]. - Depreciation and amortization expense for the nine months ended November 30, 2024, was $531,803, a 43% decrease from $940,930 in the same period in 2023 [220]. - Net cash used in operating activities for the nine months ended November 30, 2024, was $3,143,697, an increase of 39% from $2,265,048 in the same period of 2023 [240]. - Net cash provided by financing activities increased by 12% to $3,295,684 for the nine months ended November 30, 2024, compared to $2,952,029 in 2023 [244].