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 for the year ended February 28, 2025, an increase of $1,676,154 or 29% from $5,740,577 in 2024[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]. - Net loss applicable to common shareholders totaled $10,198,684 for the year ended February 28, 2025, compared to $7,339,276 in 2024[255]. Cash Flow and Liquidity - As of February 28, 2025, the company had $1,062,367 in cash and an accumulated deficit of $34,349,823[258]. - Net cash used in operating activities from continuing operations was $5,088,498 for the year ended February 28, 2025, an increase of $32,403 or 0.6% from $5,056,095 in 2024[267]. - The company estimates it will require a minimum of $5.5 million to continue operations for the next twelve months[265]. - 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]. - 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]. Operational Developments - NextTrip's travel booking platform is powered by the proprietary NXT2.0 engine, offering extensive inventory for leisure, group, and business travelers[198]. - 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 aims to integrate its Media and Travel divisions to enhance revenue generation, with advertising revenue expected to become a key driver of higher-margin income[201]. - NextTrip's media properties, including Travel Magazine and Journy.tv, are expected to drive high-intention traffic into the booking funnel, constituting a separate high-margin advertising revenue stream over time[198]. - The company is in the early stages of development, with current revenue streams being small and unpredictable compared to established industry leaders[202]. Receivables and Allowances - 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 allowance for credit losses of $2,567,665 established due to uncertainty in collectability[213]. Expenses and Impairment - 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]. - The company assesses impairment of intangible assets based on significant underperformance or changes in business strategy[229]. Market Conditions - 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].

Revenue and Financial Performance - NextTrip recognized revenue of $458,752 for the year ended February 29, 2024, an increase of $75,920, or 19.8%, compared to $382,832 in the same period in 2023[167]. - Cost of revenue for the year ended February 29, 2024, was $397,532, reflecting an increase of $42,611, or 12%, from $354,921 in the same period in 2023[168]. - Operating expenses increased by $760,811, or 15.3%, totaling $5,740,577 for the year ended February 29, 2024, compared to $4,979,766 for the previous year[169]. - Net loss from continuing operations totaled $6,656,837 for the year ended February 29, 2024, compared to a net loss of $5,033,496 for the previous year[181]. - Total net cash used in operating activities increased by $1,938,809, totaling $5,731,409 for the year ended February 29, 2024[191]. - NextTrip raised $4,791,804 in net proceeds during the year ended February 29, 2024, compared to $8,134,955 in the previous year[194]. - The company estimates a minimum requirement of $5.5 million to continue operations for the next twelve months[187]. Accounts Receivable and Allowances - Trade accounts receivable as of February 29, 2024, were $34,082, compared to $0 as of February 28, 2023[154]. - An allowance for doubtful accounts of $1,567,665 was established due to uncertainty in collectability from NextPlay under a promissory note[154]. - The loss on the promissory note receivable was $1,567,665, with a total outstanding balance of $2,567,665 from NextPlay, which is in default[172]. Expenses and Compensation - Salaries and stock-based compensation expenses decreased by $519,809, or 24.5%, totaling $1,604,487 for the year ended February 29, 2024[170]. - Stock-based compensation totaled $116,512 for the year ended February 29, 2024, compared to $0 for the previous year, due to the assumption of Sigma's stock options[171]. - General and administrative expenses decreased by $57,455, totaling $152,106 for the year ended February 29, 2024[173]. - Professional service fees increased by $806,076, or 131%, totaling $1,421,508 for the year ended February 29, 2024[174]. Business Developments and Strategy - NextTrip's proprietary booking engine, NXT2.0, was built upon a platform acquired in June 2022, which previously powered Bookit.com, generating over $400 million in annual sales in 2019[142]. - The company has shifted focus to enhancing its program offerings, including developing a booking engine platform for packaged vacations and business travel management[146]. - NextTrip completed the reverse acquisition of Sigma on December 29, 2023, with 13,001 closing shares issued to NextPlay and 486,999 contingent shares to be issued upon achieving business milestones[148]. - The company is focused on integrating the NXT2.0 technology platform to enhance booking conversion rates and serve mid- to luxury travelers[143]. Accounting Policies - NextTrip's financial statements are prepared on a consolidated basis with its wholly owned subsidiaries, following U.S. GAAP[152]. - NextTrip's revenue recognition follows ASC 606, recognizing revenue when the customer has purchased the product and the performance obligation is satisfied[162].

Revenue Performance - Revenue for the three months ended September 30, 2023, was $141,988, a decrease of $46,257, or 25%, compared to $188,245 in the same period in 2022[112]. - Revenue for the nine months ended September 30, 2023 was $369,188, a decrease of $107,561 or 23% compared to the same period in 2022[126]. Cost of Revenue - Cost of revenue increased to $176,116 for the three months ended September 30, 2023, up $96,403, or 121%, from $79,713 in the same period in 2022[114]. - The increase in cost of revenue was primarily due to the cost of a new quad laser sold at a discounted price in the third quarter of 2023[114]. Operating Expenses - Total operating expenses for Q3 2023 were $866,199, a decrease of $1,526,757 or 64% compared to Q3 2022[115]. - Total operating expenses for the nine months ended September 30, 2023 were $4,078,912, a decrease of $2,889,167 or 42% compared to the same period in 2022[128]. - Salary and benefits costs decreased by $938,911 or 77% to $288,894 in Q3 2023, primarily due to furloughed and terminated employees[116]. - Stock-based compensation fell by $191,340 or 70% to $84,078 in Q3 2023, mainly due to forfeitures of unvested options[117]. Net Loss - Net loss applicable to common stockholders for Q3 2023 was $882,348, a decrease of $1,424,180 or 62% from Q3 2022[125]. Cash and Working Capital - Cash and working capital as of September 30, 2023, were $556,087 and $564,386 respectively, down from $2,845,931 and $3,644,522 as of December 31, 2022[141]. - Net cash used in operating activities for the nine months ended September 30, 2023 was $2,586,884, a decrease of $3,799,531 or 59.5% from the same period in 2022[143]. - For the nine months ended September 30, 2023, the net cash used in operating activities was $3,931,455, a decrease from $6,746,873 in the same period of 2022, reflecting an improvement of $2,815,418 or 41.7%[144][145]. Changes in Working Capital - Changes in working capital for 2023 included a decrease in accounts receivable by $312,620 and a decrease in inventory by $175,877, indicating improved cash collection and reduced manufacturing activity[144]. Financing Activities - The company raised $772,468 in net proceeds by selling 128,887 common shares on October 13, 2023, to fund scaled-back operations[142]. - The company raised $364,555 in net proceeds through its ATM Agreement in Q3 2023, with an additional $772,468 raised in October 2023[147]. - There were no warrant exercises during the nine months ended September 30, 2023, or September 30, 2022, indicating stable financing activity[147]. Strategic Initiatives - The company began offering its PrintRite3D platform on a subscription basis, reducing the initial cost from over $100,000 to approximately $3,000-$5,000 per month[101]. - An Asset Purchase Agreement was entered into with Divergent Technologies for a purchase price of $1,626,242, expected to close after the acquisition of NextTrip Holdings, Inc.[103]. - A Share Exchange Agreement was signed with NextTrip Holdings, Inc., where NextTrip will become a wholly owned subsidiary of Sigma, with shareholders receiving shares equal to 19.99% of Sigma's outstanding shares[105][106]. - The maximum contingent shares issuable under the Share Exchange Agreement will not exceed 6,000,000 shares, potentially reducing Sigma shareholders' ownership to approximately 9.8% post-issuance[108]. - The company is focusing on building strategic partnerships and expanding its partner ecosystem to enhance customer success[101]. Allowance for Doubtful Accounts - The company has established an allowance for doubtful accounts of $115,000 as of September 30, 2023, compared to $0 in the same period in 2022[94]. Non-Cash Expenses - The company reported non-cash expenses of $511,763 in 2023, which included $466,244 for stock-based compensation[144]. Other Financial Metrics - Preferred dividends for the nine months ended September 30, 2023 were $33,122, down from $42,660 in the same period in 2022[139]. - Net cash used in investing activities decreased to $67,515 in 2023 from $259,952 in 2022, a reduction of $192,437 or 74.0%[146]. - The decrease in accounts payable and accrued expenses in 2022 was $141,192, primarily due to incentive bonus payments[145]. - The company experienced no material effects from inflation, changing prices, or rising interest rates over the last two fiscal years[147]. - The decrease in deferred revenue in 2022 was $19,166, reflecting changes in customer contracts and sales[145]. - The company has no off-balance sheet arrangements as defined in Item 303(a) of Regulation S-K[148].

Revenue and Expenses - Revenue for the three months ended June 30, 2023, was $97,043, a decrease of $139,617, or 59%, compared to $236,660 in the same period in 2022[99] - Cost of revenue for the same period was $36,491, down $156,584, or 81%, from $193,075 in the prior year[100] - Total operating expenses decreased by $914,854, or 40%, to $1,364,571 for the three months ended June 30, 2023, compared to $2,279,425 in 2022[101] - Revenue for the six months ended June 30, 2023, was $227,202, a decrease of 21% from $288,504 in the same period in 2022[114] - Cost of revenue for the six months ended June 30, 2023, was $100,155, down 57% from $233,166 in the same period in 2022[115] - Total operating expenses for the six months ended June 30, 2023, were $3,212,715, a decrease of 30% from $4,575,123 in the same period in 2022[116] Salary and Benefits - Salary and benefits costs were $554,182, a decrease of $630,636, or 53%, from $1,184,818 in the same period in 2022[102] - Stock-based compensation decreased by $28,950, or 17%, to $138,489 for the three months ended June 30, 2023, compared to $167,439 in 2022[103] Research and Development - Research and development costs were $105,259, down $41,626, or 28%, from $146,885 in the same period in 2022[104] Marketing and Organizational Costs - Investor, public relations, and marketing costs decreased by $94,476, or 62%, to $57,824 during the three months ended June 30, 2023, compared to $152,300 in 2022[105] - Organization costs decreased to $38,240 for the three months ended June 30, 2023, down 37% from $60,817 in the same period in 2022[106] - Office expenses decreased significantly to $94,190 for the three months ended June 30, 2023, down 69% from $303,600 in the same period in 2022[109] - Legal and professional fees increased to $152,025 for the three months ended June 30, 2023, a 5% increase from $144,528 in the same period in 2022[107] Net Loss and Cash Flow - Net loss applicable to common stockholders decreased to $1,318,782 for the three months ended June 30, 2023, a 42% reduction from $2,261,390 in the same period in 2022[113] - Net cash used in operating activities decreased to $2,414,881 for the six months ended June 30, 2023, a 44% reduction from $4,314,503 in the same period in 2022[132] - Net cash used in investing activities decreased to $62,607 for the six months ended June 30, 2023, down 68.6% from $199,045 in the same period in 2022[135] Financial Position - As of June 30, 2023, the company had $368,443 in cash and working capital of $948,091, compared to $2,845,931 in cash and working capital of $3,644,522 as of December 31, 2022[130] Strategic Considerations - The company began offering its PrintRite3D platform on a subscription basis, reducing the initial cost from over $100,000 to approximately $3,000-$5,000 per month[95] - The company is considering a range of strategic alternatives, including potential mergers or acquisitions, and has received multiple non-binding proposals[96][97] Risk and Market Conditions - Inflation and rising interest rates have not materially affected the company's operations over the last two fiscal years, but continued unfavorable trends may increase cash usage[139] - The company has no off-balance sheet arrangements as defined in Item 303(a) of Regulation S-K[140] - There are no applicable quantitative and qualitative disclosures about market risk[141] Allowance for Doubtful Accounts - As of June 30, 2023, the company established an allowance for doubtful accounts of $115,600, compared to $0 as of June 30, 2022[87]

Business Model and Strategy - The company transitioned to a subscription model for its PrintRite3D platform, reducing initial costs from over $100,000 to approximately $3,000-$5,000 per month[87] - The company aims to increase revenue from OEMs in 2023, particularly with the introduction of software-only products[88] - The company is evaluating strategic alternatives, including potential acquisitions or mergers, to enhance market visibility and customer adoption[90] - The company has launched a three-tiered OEM program to expand its technology distribution among various OEMs[86] - The company is building strategic partnerships to simplify the quality experience for customers, integrating multiple software licenses into a single user experience[85] - The company is working to integrate its technology with industry-wide hardware providers, enhancing its product offerings and market presence[86] Financial Performance - Revenue for the three months ended March 31, 2023, was $130,159, an increase of $78,315, or 151%, compared to $51,844 in the same period in 2022[94] - Cost of revenue increased to $63,664 for the three months ended March 31, 2023, up $23,573, or 59%, from $40,091 in the same period in 2022[95] - Total operating expenses decreased to $1,848,144 for the three months ended March 31, 2023, a reduction of $447,554, or 20%, compared to $2,295,698 in the same period in 2022[96] - Salary and benefits costs were $931,583 for the three months ended March 31, 2023, down $360,427, or 28%, from $1,292,010 in the same period in 2022[97] - Net loss applicable to common stockholders for the three months ended March 31, 2023, was $1,763,447, a decrease of $458,168, or 21%, compared to $2,221,615 in the same period in 2022[107] Cash Flow and Working Capital - Cash and working capital as of March 31, 2023, were $1,488,704 and $2,105,349, respectively, down from $2,845,931 and $3,644,522 as of December 31, 2022[108] - Net cash used in operating activities was $1,309,537 for the three months ended March 31, 2023, a decrease of $717,482, or 35.4%, compared to $2,027,019 in the same period in 2022[112] - Net cash used in investing activities was $47,690 for the three months ended March 31, 2023, a decrease of $94,409, or 66.4%, from $142,099 in the same period in 2022[115] - The company has no arrangements for additional financing and may face challenges in raising funds, which could impact operations[109] Product Development and Quality - In 2022, the company focused on retrofit work while developing software-only products, which adversely affected revenue growth[88] - The company has invested in developing machine and process software products to enhance in-process quality in additive manufacturing[89] - The company recognizes revenue primarily from software sales and engineering services, adhering to ASC Topic No. 606 for revenue recognition[73] - The company is focused on creating a holistic digital quality experience that connects in-process data to improve manufacturing processes[84] - The company has developed a deep patent portfolio and is exploring an intellectual property licensing program to facilitate strategic transactions[93]

Financial Performance - Revenue for fiscal 2022 was $630,428, a decrease of 61.8% from $1,651,765 in fiscal 2021, primarily due to a drop in perpetual license sales of $1,141,323[126] - Gross margin decreased to 44% in fiscal 2022 from 66% in fiscal 2021, attributed to increased component prices and discounted sales[127] - Operating expenses for fiscal 2022 were $9,029,502, a decrease of 5.7% from $9,571,185 in fiscal 2021, mainly due to reduced stock-based compensation[128] - Net loss before preferred dividends increased to $8,692,424 in fiscal 2022 from $7,384,605 in fiscal 2021, reflecting a rise of 17.5%[138] - Cash and working capital as of December 31, 2022, were $2,845,931 and $3,644,522, respectively, down from $11,447,047 and $11,702,358 in 2021[140] - Net cash used in operating activities was $8,212,154 in fiscal 2022, resulting from a net loss and working capital usage[145] - Stock-based compensation decreased by 25.6% to $793,251 in fiscal 2022 from $1,066,455 in fiscal 2021 due to fewer stock options granted[130] - Employee headcount decreased to 25 as of December 31, 2022, from 33 in the previous year, reflecting a shift towards a software-only subscription model[123] - In fiscal 2021, the net cash used in operating activities was $6,298,959, driven by a net loss of $7,384,605 before preferred dividends[146] - Non-cash expenses in fiscal 2021 included stock-based compensation of $1,768,123 and depreciation and amortization of $94,105[146] - Cash generated from working capital was $315,859, primarily due to an increase in accounts payable and accrued expenses of $373,563[146] - In fiscal 2022, net cash used by investing activities was $388,962, an increase from $359,750 in fiscal 2021[147] - The increase in investing activities was attributed to higher patent costs of $47,112[147] - No cash was provided by financing activities in fiscal 2022, compared to $14,404,942 in fiscal 2021[148] - In fiscal 2021, financing activities included net proceeds of $13,268,932 from financings[148] - There are no off-balance sheet arrangements as defined in Item 303(a) of Regulation S-K[149] - Quantitative and qualitative disclosures about market risk are not applicable[150] Business Strategy - Sigma's PrintRite3D integrated hardware and software solution is now offered on a subscription basis, reducing initial costs from over $100,000 to approximately $3,000-$5,000 per month[100] - The company expects the percentage of revenue from OEMs to increase in 2023 and beyond, driven by the availability of software-only products and integration with existing hardware[101] - The company is focusing on building strategic partnerships and expanding its partner ecosystem to enhance customer success and market presence[98] - Sigma has initiated a strategic evaluation of alternatives, including potential investments, acquisitions, or mergers to enhance product and financial synergies[103] - The company aims to simplify the quality experience from up to twelve disparate software licenses to a single integrated user experience[98] - Sigma's technology is printer agnostic and compatible with most leading 3D metal and polymer printers, expanding its market reach[97] - The company is integrating with industry-wide hardware providers, including a recently announced relationship with a laser scanner provider[99] - The company plans to transition to a subscription-based, software-only product offering to enhance commercialization of its PrintRite3D® technology in 2023[144] Operational Challenges - The company continues to face supply chain challenges, including increased lead times for certain hardware components of PrintRite3D[106]

Revenue Performance - Revenue for the three months ended September 30, 2022, was $188,245, a decrease of $511,992 or 72.7% compared to $700,237 in the same period in 2021[101] - The decrease in revenue was primarily due to lower PrintRite3D® unit sales of $511,870 and a shift to subscription-based sales[101] - Revenue for the nine months ended September 30, 2022 was $476,749, a decrease of $825,776 or 63.4% compared to the same period in 2021[116] Subscription Model Transition - The company began offering a subscription option in January 2022, reducing the initial upfront cost from over $100,000 to approximately $3,000-$5,000 per month[94] - The shift to a subscription model has adversely affected near-term revenue growth but is expected to lead to more predictable and profitable revenues in the long term[95] Operating Expenses - Total operating expenses for Q3 2022 were $2,392,596, a decrease of $633,932 or 20.9% compared to Q3 2021[104] - Operating expenses for the nine months ended September 30, 2022 were $6,968,079, a decrease of $8,865 compared to the same period in 2021[118] Cost of Revenue - Cost of revenue for Q3 2022 was $79,713, a decrease of $85,053 or 51.6% compared to Q3 2021[102] Employee and Compensation Changes - The company reduced its headcount by a net of seven employees, bringing the total to twenty-five, a reduction of ten from a peak of thirty-five[96] - Salary and benefits costs increased by $5,045 or 0.4% to $1,227,805 in Q3 2022 compared to Q3 2021[105] - Salary and benefits costs for the nine months ended September 30, 2022 increased by $649,354 or 21.3% to $3,704,633 compared to the same period in 2021[119] - Stock-based compensation decreased by $384,094 or 58.2% to $275,418 in Q3 2022 compared to Q3 2021[106] - Research and development costs increased by $20,473 or 15.5% to $152,245 in Q3 2022 compared to Q3 2021[107] Financial Position and Cash Flow - As of September 30, 2022, the company had $4,800,680 in cash and working capital of $5,492,725, a decrease from $11,447,047 and $11,702,358 as of December 31, 2021[130] - Net cash used in operating activities during the nine months ended September 30, 2022 was $6,386,415, an increase of 33% compared to $4,786,590 during the same period in 2021[138] - Net cash used in investing activities during the nine months ended September 30, 2022 was $259,952, a 2% increase from $254,772 in the same period of 2021[139] - The company did not raise any capital during the nine months ended September 30, 2022, contrasting with $14,404,942 raised in the same period of 2021[140] Strategic Initiatives - Sigma is focused on building strategic partnerships and expanding its partner ecosystem to ensure customer success as they move into production[97] - The company aims to simplify the quality experience from multiple software licenses to a single integrated user experience[97] - Sigma has invested in developing a holistic in-process quality base to connect to the broader digital quality ecosystem[99] - The company is pursuing a strategic corporate investment partner to enhance market visibility and customer adoption[98] Future Outlook and Risks - The company expects to sustain operations and commercialization efforts through cash reserves and revenues from PrintRite3D® technology sales[135] - Future capital requirements will depend on factors including revenue generation from existing and future PrintRite3D contracts and potential strategic partnerships[141] - The ongoing impact of the COVID-19 epidemic may affect the company's operations, particularly due to component shortages for PrintRite3D systems[136] - The company has no lines of credit or other financing arrangements, which may limit its ability to respond to financial needs[142] - Inflation and rising interest rates have not materially affected operations over the past two fiscal years, but continued unfavorable trends may increase cash usage[142] - The company is currently identifying sources of financing, either through equity or debt, to support its operations[134]

Revenue and Cost Analysis - Revenue for the three months ended June 30, 2022, was $236,660, an increase of $92,512, or 64.2%, compared to $144,148 in the same period in 2021[92]. - Cost of revenue for the same period was $193,075, an increase of $76,678, or 65.9%, compared to $116,397 in 2021[93]. - Revenue for the six months ended June 30, 2022 was $288,504, a decrease of 52.1% from $602,288 in the same period in 2021[106]. - Cost of revenue for the six months ended June 30, 2022 was $233,166, a decrease of 4.7% from $244,728 in the same period in 2021[107]. Operating Expenses - Total operating expenses for the three months ended June 30, 2022, were $2,279,425, an increase of $110,774, or 5.1%, compared to $2,168,651 in 2021[94]. - Operating expenses for the six months ended June 30, 2022 were $4,575,123, an increase of 15.8% from $3,950,057 in the same period in 2021[108]. - Salary and benefits costs increased to $1,184,818 for the three months ended June 30, 2022, up $199,470, or 20.2%, from $985,348 in 2021[95]. - Stock-based compensation was $167,439 for the three months ended June 30, 2022, an increase of $50,998, or 43.8%, compared to $116,441 in 2021[96]. - Operations and research and development expenses decreased to $146,885, down $133,815, or 47.7%, from $280,700 in the same period of 2021[97]. - Investor, public relations, and marketing expenses were $152,300, an increase of $37,538, or 32.7%, compared to $114,762 in 2021[98]. - Organization costs for Q2 2022 were $60,817, a decrease of 61.6% from $158,529 in Q2 2021[99]. - Legal and professional fees in Q2 2022 were $144,528, down 40.8% from $244,019 in Q2 2021[100]. - Office expenses for Q2 2022 increased to $303,600, a 99.9% rise from $151,871 in Q2 2021[101]. Cash Flow and Liquidity - Cash as of June 30, 2022 was $6,933,499, down from $11,447,047 as of December 31, 2021[121]. - Net cash used in operating activities increased to $4,314,503 for the six months ended June 30, 2022, a 32.1% increase from $3,266,620 in the same period of 2021[129]. - Net cash used by investing activities rose to $199,045 for the six months ended June 30, 2022, an increase of 84.3% from $108,021 in the same period of 2021[130]. - The company did not raise any capital or exercise any warrants during the six months ended June 30, 2022, compared to $14,404,942 provided by financing activities in the same period of 2021[131]. - The company’s ability to fund liquidity and working capital needs depends on generating revenues from existing and future PrintRite3D contracts and obtaining additional capital[132]. - There are no lines of credit or other financing arrangements currently in place for the company[133]. - Inflation and rising interest rates have not materially affected the company's operations over the last two fiscal years, but continued unfavorable trends may increase cash usage[133]. - The company has no off-balance sheet arrangements as defined in Item 303(a) of Regulation S-K[134]. - There are no applicable quantitative and qualitative disclosures about market risk[135]. Business Model and Strategy - The company began offering its PrintRite3D platform on a subscription basis, reducing the initial upfront cost from over $100,000 to approximately $3,000-$4,000 per month[88]. - A three-year plan was announced to increase the company's ability to commercialize its PrintRite3D technologies and improve gross margins by moving towards a software-only solution[86]. - The shift in business model is expected to contribute to faster adoption of products and more predictable and profitable revenues over the long term[91]. Net Loss - Net loss applicable to common stockholders for the six months ended June 30, 2022 was $4,483,005, an increase of $1,911,671 from $2,571,334 in the same period in 2021[120]. Impact of COVID-19 - The ongoing COVID-19 pandemic has caused a reduction in capital spending, but may accelerate the adoption of 3D printing in the long term[127].

Revenue and Income - Revenue for the three months ended March 31, 2022, was $51,844, a decrease of $406,296, or 89%, compared to $458,140 in the same period in 2021[83] - The company recognized an increase in revenues from its subscription-based pricing program by $13,425[83] - Net other income decreased by $724,386, or 90%, to $76,550 in Q1 2022, compared to $800,936 in Q1 2021, mainly due to an unrealized gain of $802,285 in 2021[96] - Net loss applicable to common stockholders for Q1 2022 was $2,221,615, an increase of $1,510,048 from $711,567 in Q1 2021, driven by an increased loss from operations of $832,350 and decreased other income[97] Expenses - Cost of revenue for the same period was $40,091, down $88,240, or 69%, from $128,331 in 2021, primarily due to fewer unit sales[84] - Total operating expenses increased to $2,295,698, an increase of $514,294, or 29%, compared to $1,781,404 in the same period in 2021[85] - Salary and benefits costs rose to $1,292,010, an increase of $444,839, or 53%, compared to $847,171 in 2021[86] - Stock-based compensation increased to $170,976, up $53,499, or 46%, from $117,477 in the same period in 2021[87] - Research and development expenses decreased to $143,418, down $52,922, or 30%, compared to $196,340 in 2021[88] - Legal and professional fees increased to $211,416, an increase of $34,569, or 20%, compared to $176,847 in 2021[92] - Depreciation and amortization expense rose to $31,584, an increase of $8,553, or 37%, compared to $23,031 in 2021[94] - Other operating expenses increased to $87,787 for the three months ended March 31, 2022, compared to $86,356 for the same period in 2021, primarily due to a $1,701 increase in insurance policy premiums[95] Cash Flow and Capital - Cash and working capital as of March 31, 2022, were $9,277,929 and $9,588,858, respectively, down from $11,447,047 and $11,702,358 as of December 31, 2021[98] - Net cash used in operating activities increased to $2,027,019 in Q1 2022, a 63% increase from $1,240,586 in Q1 2021, due to a rise in net loss and decreases in accounts payable and accrued expenses[107] - Net cash used by investing activities rose to $142,099 in Q1 2022 from $21,969 in Q1 2021, attributed to reclassified leased PrintRite3D units and increased patent costs[108] - The company did not raise any capital or have warrant exercises in Q1 2022, contrasting with $14,404,942 in cash provided by financing activities in Q1 2021[109] - The company expects to sustain operations and commercialization efforts in 2022 using cash reserves and revenues from PrintRite3D technology sales[103] - Future capital requirements will depend on various factors, including revenue from existing and future products and costs associated with business expansion[106] - The company has no lines of credit or other financing arrangements, which may impact its ability to fund liquidity and working capital needs[111] Business Model - The company introduced a subscription model reducing initial costs from over $100,000 to approximately $3,000-$4,000 per month[79]

Financial Performance - Sigma generated revenues of $1,651,765 in fiscal 2021, up from $807,488 in fiscal 2020, representing an increase of 104%[123] - Gross margin improved to 66% in fiscal 2021 from 27% in fiscal 2020, a 39% increase attributed to lower material costs and improved efficiency[121] - The company sold 11 PrintRite3D units in 2021, compared to 6 units in 2020, reflecting a growth in sales volume[123] - Net other income for fiscal 2021 was $1,094,780, a significant increase of 119.6% from $498,629 in fiscal 2020, mainly due to a gain on derivative liability[132] - The net loss before preferred dividends for fiscal 2021 was $7,384,605, an increase of 42.0% from $5,200,139 in fiscal 2020[133] Operating Expenses - Operating expenses increased to $9,571,185 in fiscal 2021 from $5,914,299 in fiscal 2020, a rise of $3,656,886[124] - Research and development expenditures rose to $890,553 in fiscal 2021 from $351,404 in fiscal 2020, with significant investments in new product development[127] - Sigma's stock-based compensation increased to $1,066,455 in fiscal 2021 from $596,842 in fiscal 2020, driven by new grants to employees[126] - Organizational costs for fiscal 2021 were $726,147, an increase of 60.6% compared to $451,982 in fiscal 2020[128] - Legal and professional service fees rose to $915,530 in fiscal 2021, up 35.4% from $676,142 in fiscal 2020, primarily due to increased recruiting fees and consulting expenses[129] - Office expenses increased by $317,806 to $734,386 in fiscal 2021, a rise of 76.3% compared to $416,580 in fiscal 2020, driven by higher travel and postage costs[130] Cash Flow and Capital - Cash and working capital as of December 31, 2021, were $11,447,047 and $11,702,358 respectively, compared to $3,700,814 and $4,332,053 as of December 31, 2020, indicating a substantial increase[134] - Cash provided by financing activities increased to $14,404,942 in fiscal 2021, up 65.0% from $8,722,122 in fiscal 2020, due to higher net proceeds from financings[141] - Net cash used in operating activities rose to $6,298,959 in fiscal 2021, an increase of 30.9% from $4,809,868 in fiscal 2020[139] - The company anticipates that existing cash reserves will be sufficient to cover operating costs and capital expenditures through 2022[134] Strategic Initiatives - The company added 13 full-time employees in 2021, expanding the sales team from 2 to 7 to support business growth[119] - Sigma plans to offer its PrintRite3D solution on a subscription basis, reducing initial costs from over $100,000 to approximately $3,000-$4,000 per month[103] - The company launched a three-tiered OEM program to expand distribution of its technology among various OEMs[104] - The company plans to continue funding development activities and operating expenses through licensing and consulting services related to its PrintRite3D® technology[138] Cost Management - Sigma's cost of revenue decreased to $559,965 in fiscal 2021 from $591,957 in fiscal 2020, primarily due to improved manufacturing efficiency[123]