[Filing Information](index=1&type=section&id=Filing%20Information) [Form 10-Q Details](index=1&type=section&id=Form%2010-Q%20Details) This Quarterly Report on Form 10-Q for Connexa Sports Technologies Inc. covers the period ended July 31, 2025, detailing its status as a Nasdaq-listed non-accelerated filer - The report is a **Quarterly Report on Form 10-Q** for the period ended July 31, 2025[2](index=2&type=chunk) - Connexa Sports Technologies Inc. is incorporated in Delaware[2](index=2&type=chunk) Company Classification and Trading Information | Attribute | Value | | :--- | :--- | | Trading Symbol | YYAI | | Exchange | Nasdaq Capital Market | | Filer Status | Non-accelerated filer, Smaller reporting company | [Shares Outstanding](index=2&type=section&id=Shares%20Outstanding) As of September 12, 2025, the company had 14,563,019 shares of common stock outstanding Common Stock Outstanding | Date | Shares Outstanding | | :--- | :--- | | September 12, 2025 | 14,563,019 | [Cautionary Statement Regarding Forward-Looking Information](index=3&type=section&id=CAUTIONARY%20STATEMENT%20REGARDING%20FORWARD%20LOOKING%20INFORMATION) [Forward-Looking Statements Disclosure](index=3&type=section&id=Forward-Looking%20Statements%20Disclosure) This report contains forward-looking statements subject to risks and uncertainties, with no obligation for the company to update them - The report includes **forward-looking statements** identified by words like 'believe,' 'expect,' 'anticipate,' 'intend,' 'estimate,' 'may,' 'should,' 'could,' 'will,' 'plan,' 'future,' and 'continue'[6](index=6&type=chunk) - Actual results may differ materially due to inaccurate assumptions, **business risks**, and known/unknown uncertainties beyond the company's control[6](index=6&type=chunk) - The company does not undertake to update or revise any forward-looking statements, except as required by law[7](index=7&type=chunk) [Key Risk Factors](index=3&type=section&id=Key%20Risk%20Factors) Key risks include low public float volatility, acquisition impacts, litigation, financing, and macroeconomic factors - **Volatility** related to the Company's relatively low public float[9](index=9&type=chunk) - The effects of prior **acquisitions and divestitures** on current and future business operations[9](index=9&type=chunk) - **Strategic and operational uncertainties**[9](index=9&type=chunk) - Risks associated with potential **litigation, financing transactions, or acquisitions**[9](index=9&type=chunk) - **Macroeconomic, competitive, legal, regulatory, tax, and geopolitical factors**[9](index=9&type=chunk) - Other **risks and uncertainties** related to prospects, properties, and business strategy[9](index=9&type=chunk) [PART I - FINANCIAL INFORMATION](index=5&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents Connexa Sports Technologies Inc.'s unaudited consolidated financial statements and detailed notes [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) Total assets increased by $1.8 million, driven by accounts receivable and investments, while cash slightly decreased Consolidated Balance Sheet Highlights | Metric | As of July 31, 2025 | As of April 30, 2025 | Change (Approx.) | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | $52,693 | $54,744 | -$2,051 | | Investment | $2,464,615 | $1,382,857 | +$1,081,758 | | Accounts receivable | $18,388,701 | $15,388,701 | +$3,000,000 | | Total Current Assets | $24,972,762 | $22,396,159 | +$2,576,603 | | Intangible assets, net | $9,765,404 | $10,509,635 | -$744,231 | | TOTAL ASSETS | $34,738,166 | $32,905,794 | +$1,832,372 | | Total Current Liabilities | $7,058,612 | $6,487,171 | +$571,441 | | Total Shareholders' Equity | $27,679,554 | $26,418,623 | +$1,260,931 | [Consolidated Statements of Operations and Comprehensive Income](index=6&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income) Revenue and gross profit decreased, while G&A expenses surged, leading to a substantial decline in net income Consolidated Statements of Operations Highlights (Three Months Ended July 31) | Metric | 2025 (unaudited) | 2024 (unaudited) | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | REVENUE | $3,000,000 | $3,272,727 | $(272,727) | -8% | | COST OF REVENUE | $744,231 | $744,231 | $0 | 0% | | GROSS PROFIT | $2,255,769 | $2,528,496 | $(272,727) | -11% | | General and administrative expenses | $764,386 | $88,520 | $675,866 | 764% | | OPERATING INCOME | $1,491,383 | $2,439,976 | $(948,593) | -39% | | NET INCOME ATTRIBUTABLE TO CONTROLLING INTEREST | $882,652 | $2,051,025 | $(1,168,373) | -57% | | Net income per share - basic | $0.06 | $0.18 | $(0.12) | -67% | | Weighted average common shares outstanding - basic | 14,563,023 | 11,610,817 | 2,952,206 | 25% | [Consolidated Statement of Changes in Shareholders' Equity](index=7&type=section&id=Consolidated%20Statement%20of%20Changes%20in%20Shareholders'%20Equity) Total shareholders' equity increased from May 1 to July 31, 2025, primarily due to comprehensive income Shareholders' Equity Changes (May 1, 2025 to July 31, 2025) | Metric | As of May 1, 2025 | Total Comprehensive Income | As of July 31, 2025 | | :--- | :--- | :--- | :--- | | Common Stock Amount | $14,563 | - | $14,563 | | Additional Paid-In Capital | $19,138,786 | - | $19,138,786 | | Retained Earnings | $6,123,114 | $882,652 | $7,005,766 | | Non-Controlling Interest | $1,142,160 | $378,279 | $1,520,439 | | Total Shareholders' Equity | $26,418,623 | $1,260,931 | $27,679,554 | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Operating cash usage increased, offset by financing, leading to a slight net decrease in cash and equivalents Consolidated Cash Flow Highlights (Three Months Ended July 31) | Metric | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Net income | $1,260,931 | $2,051,025 | $(790,094) | | Net cash used in operating activities | $(1,083,809) | $(601,294) | $(482,515) | | Net cash provided by financing activities | $1,081,758 | $606,803 | $474,955 | | NET INCREASE (DECREASE) IN CASH | $(2,051) | $5,509 | $(7,560) | | CASH AND CASH EQUIVALENTS - END OF PERIOD | $52,693 | $44,860 | $7,833 | [Notes to the Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) These notes detail accounting policies, risks, assets, revenue, related parties, equity, and subsequent events [Note 1. Organization and Nature of Business](index=9&type=section&id=Note%201.%20ORGANIZATION%20AND%20NATURE%20OF%20BUSINESS) Connexa acquired YYEM, divested Slinger Bag, now focusing on AI matchmaking technology and MENA social networking content - Connexa Sports Technologies Inc. (formerly Slinger Bag Inc.) acquired **70% of Yuanyu Enterprise Management Co., Limited (YYEM)** for **$56 million**, with **$16.5 million in cash** and the remainder in shares, closing on November 21, 2024[25](index=25&type=chunk)[33](index=33&type=chunk)[34](index=34&type=chunk) - The transaction was accounted for as a **'reverse acquisition'** where YYEM was the accounting acquirer, and Connexa was the legal acquirer, resulting in YYEM shareholders owning approximately **75.3%** of the combined company[35](index=35&type=chunk)[36](index=36&type=chunk) - Following the acquisition, Connexa disposed of its Slinger Bag business, making YYEM its sole operating subsidiary[34](index=34&type=chunk)[38](index=38&type=chunk) - YYEM operates in the emerging love and marriage market sector, aiming to empower global connections through innovative matchmaking technology[38](index=38&type=chunk) - YYEM owns advanced patents and proprietary technology, which it licenses out to partners worldwide to develop **AI-powered matchmaking platforms**[39](index=39&type=chunk) - YYEM is also developing a social networking vertical to produce content for live-streaming or TikTok users in the Middle East and North Africa (MENA region), anticipating an independent revenue stream based on performance-based conversion metrics[40](index=40&type=chunk) - YYEM's revenue model is currently based on **licensing fees**, generating **$12.8 million in royalties** for the financial year ended April 30, 2025[40](index=40&type=chunk) [Note 2. Summary of Significant Accounting Policies](index=12&type=section&id=Note%202:%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This note outlines significant accounting policies, including GAAP, consolidation, revenue, and recent pronouncements - The financial statements are prepared in accordance with **U.S. GAAP** and SEC rules[45](index=45&type=chunk) - The company consolidates entities where it controls more than **50% of voting power** or has the ability to govern financial and operating policies[46](index=46&type=chunk)[47](index=47&type=chunk) - **Non-controlling interests** are classified as a component of equity, reflecting the **30% portion of YYEM** not attributable to the Company[50](index=50&type=chunk) - Revenue is recognized based on a **five-step model (ASC 606)** when performance obligations are satisfied, primarily from royalty income for technology licensing[75](index=75&type=chunk)[78](index=78&type=chunk) - Cost of revenue primarily consists of **amortization charges** for intangible assets (technology rights)[79](index=79&type=chunk) - The company evaluates long-lived assets for impairment when events indicate carrying value may not be recoverable, but **no impairment charge** was recognized for the three months ended July 31, 2025 and 2024[64](index=64&type=chunk) - The company adopted **ASU 2016-13 (CECL model)** for credit losses, but recorded **no expected credit losses** for accounts receivable for the three months ended July 31, 2025 and 2024[59](index=59&type=chunk)[62](index=62&type=chunk) - Several new FASB ASUs (2024-03, 2024-04, 2025-01, 2025-02, 2025-03, 2025-04, 2025-05) have been issued, but the company does not expect their adoption to have a **material impact** on its financial position, results of operations, or cash flows[98](index=98&type=chunk)[99](index=99&type=chunk)[100](index=100&type=chunk)[101](index=101&type=chunk)[102](index=102&type=chunk)[105](index=105&type=chunk)[106](index=106&type=chunk) [Note 3. Concentrations of Risk](index=21&type=section&id=Note%203:%20CONCENTRATIONS%20OF%20RISK) Significant customer and credit risk from reliance on three major customers for nearly all revenue and receivables - The company's accounts receivable and revenue are highly concentrated among **three major customers** (Customer A, D, E), accounting for approximately **100%** of total accounts receivable and total revenue for the three-month periods ended July 31, 2025 and 2024[112](index=112&type=chunk) Customer Concentration in Accounts Receivable | Customer | As of July 31, 2025 | As of July 31, 2024 | | :--- | :--- | :--- | | Customer A | 43% | 44% | | Customer D | 26% | 26% | | Customer E | 31% | 30% | - Cash and cash equivalents are held with major financial institutions believed to have high credit quality[111](index=111&type=chunk) [Note 4. Intangible Assets](index=21&type=section&id=Note%204:%20INTANGIBLE%20ASSETS) Intangible assets, primarily technology rights, are amortized over five years, with a net value of $9.77 million - Technology rights are amortized on a straight-line basis over an estimated useful life of **five years**[114](index=114&type=chunk) Intangible Assets - Technology Rights (as of July 31, 2025) | Metric | Amount | | :--- | :--- | | Cost | $14,884,615 | | Accumulated amortization | $(5,119,211) | | Net value | $9,765,404 | - Amortization expense for the three months ended July 31, 2025 and 2024, was approximately **$744,231**, included in cost of revenue[117](index=117&type=chunk) [Note 5. Revenue – Segment Reporting by Geographic Region](index=22&type=section&id=Note%205:%20REVENUE%20%E2%80%93%20SEGMENT%20REPORTING%20BY%20GEOGRAPHIC%20REGION) Revenue segmented by geographic region (Hong Kong, US, UK) decreased by 8% year-over-year Revenue by Geographic Region (Three Months Ended July 31) | Location | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Hong Kong | $1,250,000 | $1,363,636 | $(113,636) | | United States of America | $750,000 | $818,182 | $(68,182) | | United Kingdom | $1,000,000 | $1,090,909 | $(90,909) | | Total | $3,000,000 | $3,272,727 | $(272,727) | [Note 6. Accounts Receivable](index=22&type=section&id=Note%206:%20ACCOUNTS%20RECEIVABLE) Accounts receivable increased by $3.0 million to $18.39 million, with no credit loss provisions recorded Accounts Receivable | Metric | As of July 31, 2025 | As of April 30, 2025 | | :--- | :--- | :--- | | Accounts receivable | $18,388,701 | $15,388,701 | - All accounts receivable were due from third-party customers, and **no provisions for credit losses** were made as of July 31, 2025, and April 30, 2025[120](index=120&type=chunk) [Note 7. Investment](index=23&type=section&id=Note%207:%20INVESTMENT) Investment in Brightstar Technology Group is subject to a downside guarantee, ensuring a minimum value - The company holds a quoted investment in **Brightstar Technology Group Co., Ltd.**, a Hong Kong Stock Exchange-listed company[123](index=123&type=chunk) - A **downside guarantee** from the investment's contributor ensures a minimum value, with compensation for shortfalls recognized as 'Shares guarantee income'[123](index=123&type=chunk)[124](index=124&type=chunk) [Note 8. Amount Due From Related Party](index=23&type=section&id=Note%208:%20AMOUNT%20DUE%20FROM%20RELATED%20PARTY) Amount due from related party Hongyu Zhou decreased to $1.75 million, related to an investment guarantee, expected to settle Related Party Balances (Hongyu Zhou) | Metric | As of July 31, 2025 | As of April 30, 2025 | | :--- | :--- | :--- | | Amount due from related party | $1,745,770 | $2,827,528 | | Amount due to related party | $775,406 | $775,406 | - The amount due from Hongyu Zhou represents compensation under a **downside guarantee** for the investment in Brightstar Technology Group Co., Ltd., expected to be fully settled[125](index=125&type=chunk)[126](index=126&type=chunk) - The amount due to Hongyu Zhou represents expenses paid on behalf of the company[127](index=127&type=chunk) [Note 9. Accrued Expenses](index=24&type=section&id=Note%209:%20ACCURRED%20EXPENSES) Accrued expenses increased to $2.75 million, primarily due to higher accrued salaries and benefits for management Summary of Accrued Expenses | Accrued Expense Category | As of July 31, 2025 | As of April 30, 2025 | | :--- | :--- | :--- | | Accrued salaries and benefits – management | $797,387 | $477,500 | | Accrued signing bonus | $300,000 | $300,000 | | Accrued success fee | $1,000,000 | $1,000,000 | | Amount due from bank | $4,876 | $2,488 | | Accrued directors' fees | $150,000 | $150,000 | | Accrued professional fees | $498,143 | $498,143 | | Total | $2,750,406 | $2,428,131 | [Note 10. Shareholders' Equity](index=24&type=section&id=Note%2010:%20SHAREHOLDERS'%20EQUITY) Common shares outstanding increased to 14.56 million, mainly due to YYEM acquisition and warrant exercises Common Stock Issued and Outstanding | Date | Shares Issued and Outstanding | | :--- | :--- | | July 31, 2025 | 14,563,019 | | July 31, 2024 | 1,828,541 | - The company issued **8,127,572 shares** of common stock from November 1, 2024, through July 31, 2025, to complete the acquisition of YYEM[132](index=132&type=chunk) - From August 1, 2024, through October 31, 2024, **3,776,305 shares** were issued for warrant exercises[133](index=133&type=chunk) - From May 1, 2024, through July 31, 2024, **830,608 shares** were issued for various reasons including true-up shares, services rendered, warrant exercises, and fractional shares from a 1-for-20 reverse stock split[138](index=138&type=chunk) [Note 11. Commitments and Contingencies](index=25&type=section&id=Note%2011:%20COMMITMENTS%20AND%20CONTINGENCIES) No material legal proceedings or litigation existed as of July 31, 2025, that could adversely impact financial position - The company had **no material legal claims or litigation** for the three months ended July 31, 2025, that could have a material adverse impact on its financial position, results of operations, or cash flows[85](index=85&type=chunk)[139](index=139&type=chunk) [Note 12. Subsequent Events](index=25&type=section&id=Note%2012:%20SUBSEQUENT%20EVENTS) Post-period, the company closed a $4.6 million private placement, increased ATM facility, and entered a crypto exchange JV - On August 19, 2025, the company closed a private placement of **20,000,000 units** (common stock + warrants), generating gross proceeds of **$4,600,000**[140](index=140&type=chunk) - On August 22, 2025, the company increased the amount it could raise through its **'at the market' (ATM) facility to $200,000,000**[141](index=141&type=chunk) - On August 25, 2025, the company signed a JV Agreement with JuCoin Capital Pte Ltd to establish a cryptocurrency exchange, with each party contributing **$250,000,000** in cash or cryptocurrency. The company will hold **51%** of the JV's share capital[142](index=142&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial condition and results for the three months ended July 31, 2025, covering business, fundraising, and operations [Overview](index=26&type=section&id=Overview) Connexa operates through YYEM, focusing on AI matchmaking technology and content development for TikTok in MENA - The company operates through Yuanyu Enterprise Management Co., Limited (YYEM), a Hong Kong-based subsidiary established in November 2021, engaged in the **love and marriage market sector**[145](index=145&type=chunk) - YYEM licenses advanced patents and proprietary technology to develop an **AI-powered matchmaking platform** for global partners[146](index=146&type=chunk) - YYEM generated **$3.0 million in royalties** from license agreements across Asia, Europe, and Africa for the three months ended July 31, 2025[147](index=147&type=chunk) - In February 2025, YYEM entered an agency agreement to develop content for **TikTok in the MENA region**, aiming to diversify revenue streams through performance-based conversion metrics[148](index=148&type=chunk) [Fundraising](index=26&type=section&id=Fundraising) The company completed a $4.6 million private placement and increased its ATM facility to $200 million for capital flexibility - On June 30, 2025, the company executed a securities purchase agreement for a private placement of **20,000,000 units** (common stock + warrants) targeting **$4.6 million** in gross proceeds[149](index=149&type=chunk) - The private placement closed on August 19, 2025, generating **$4,600,000 in gross proceeds**[149](index=149&type=chunk) - Under a prospectus supplement dated August 22, 2025, the company's **ATM facility was increased to $200 million**, offering strategic flexibility for future capital raising[150](index=150&type=chunk) [Recent Developments](index=27&type=section&id=Recent%20Developments) The company entered a JV with JuCoin Capital to establish a crypto exchange, contributing $250 million for a 51% stake - On August 25, 2025, the company and JuCoin Capital Pte Ltd signed a JV Agreement to establish a **cryptocurrency exchange**[151](index=151&type=chunk) - Each party will contribute **$250 million** in cash or cryptocurrency to the JV[151](index=151&type=chunk) - The company will receive **51% of the JV's share capital** and appoint three of the five board members[151](index=151&type=chunk) [Components of Results of Operations](index=27&type=section&id=Components%20of%20Results%20of%20Operations) This section defines revenue, cost of revenue, general and administrative expenses, and gross profit components - Revenue is generated from **license fees** for the use of the company's technology[152](index=152&type=chunk) - Cost of revenue primarily consists of **amortization charges** against intangible assets (technology rights)[153](index=153&type=chunk) - General and administrative expenses include salaries, benefits, professional fees (legal, accounting, consulting), travel, and other office expenses[154](index=154&type=chunk) - Gross profit is calculated as revenue minus cost of revenue[154](index=154&type=chunk) [Results of Operations (Three months ended July 31, 2025, compared to July 31, 2024)](index=27&type=section&id=Results%20of%20Operations) Revenue decreased by 8%, gross profit declined by 11%, and G&A expenses surged by 764%, leading to a 39% drop in operating income Results of Operations (Three Months Ended July 31) | Metric | 2025 | 2024 | Change Amount | Change % | | :--- | :--- | :--- | :--- | :--- | | Revenue | $3,000,000 | $3,272,727 | $(272,727) | -8% | | Cost of Revenue | $744,231 | $744,231 | - | -% | | Gross Profit | $2,255,769 | $2,528,496 | $(272,727) | -11% | | General and Administrative Expenses | $764,386 | $88,520 | $675,866 | 764% | | Operating Income | $1,491,383 | $2,439,976 | $(948,593) | -39% | - Revenue decreased by **$0.3 million (8%)** due to minor timing differences in license agreement signings[156](index=156&type=chunk) - Cost of revenue remained constant as it consists solely of intangible asset amortization[157](index=157&type=chunk) - General and administrative expenses increased by **$0.7 million (764%)** due to higher costs associated with YYEM becoming an operating subsidiary of a Nasdaq-listed company (audit fees, legal fees, insurance, D&O compensation)[158](index=158&type=chunk) [Liquidity and Capital Resources](index=28&type=section&id=Liquidity%20and%20Capital%20Resources) Working capital increased by 13%, net cash used in operating activities rose by 80%, and existing cash is sufficient for 12 months Cash Flow Summary (Three Months Ended July 31) | Metric | 2025 | 2024 | Change Amount | Change % | | :--- | :--- | :--- | :--- | :--- | | Cash Flow Used in Operating Activities | $(1,083,809) | $(601,294) | $(482,515) | 80% | | Cash Flow Provided by Financing Activities | $1,081,758 | $606,803 | $474,955 | 78% | | Cash and Cash Equivalents (End of Period) | $52,693 | $44,860 | $7,833 | 17% | - Working capital increased by approximately **$2.0 million (13%)** to **$17.9 million** as of July 31, 2025[159](index=159&type=chunk) - The increase in net cash used in operating activities was primarily driven by a **$0.7 million increase** in general and administrative expenses[161](index=161&type=chunk) - The company believes existing cash and potential capital market fundraising will be sufficient to meet anticipated operating needs for at least the next **12 months**[163](index=163&type=chunk) [Off Balance Sheet Arrangements](index=28&type=section&id=Off%20Balance%20Sheet%20Arrangements) The company has no material off-balance sheet arrangements impacting its financial condition or liquidity - The company has **no material off-balance sheet arrangements**[164](index=164&type=chunk) [Significant Accounting Policies](index=28&type=section&id=Significant%20Accounting%20Policies) This section reiterates key accounting policies: estimates, credit losses, impairment, fair value, revenue, and new pronouncements [Use of Estimates](index=30&type=section&id=Use%20of%20Estimates) Management makes estimates and assumptions for financial statements, particularly for long-lived assets and deferred tax valuation - Management makes estimates and assumptions affecting reported asset/liability amounts and revenue/expense disclosures, particularly for **long-lived assets** and **deferred income tax asset valuation allowances**[167](index=167&type=chunk) - Actual results may differ materially from estimates, impacting future operations[167](index=167&type=chunk) [Allowance for Credit Losses](index=30&type=section&id=Allowance%20for%20Credit%20Losses) The company adopted the CECL model for credit losses but recorded no reserves as of July 31, 2025, and April 30, 2025 - The company adopted **ASC 326 (CECL model)** on June 30, 2022, replacing the incurred loss methodology with an expected loss approach for credit losses[169](index=169&type=chunk) - **No reserves for credit losses** were made as of July 31, 2025, and April 30, 2025[170](index=170&type=chunk) [Impairment of Long-Lived Assets](index=30&type=section&id=Impairment%20of%20long-lived%20assets) Long-lived assets are evaluated for impairment, but no charge was recognized for the three months ended July 31, 2025, and 2024 - Long-lived assets are evaluated for impairment when events or changes in circumstances indicate that the carrying value may not be fully recoverable or the useful life is shorter than estimated[171](index=171&type=chunk) - **No impairment charge** was recognized for the three months ended July 31, 2025, and 2024[171](index=171&type=chunk) [Fair Value of Financial Instruments](index=30&type=section&id=Fair%20value%20of%20financial%20instruments) Fair value is the price for an orderly transaction, and short-term financial instruments approximate fair value - Fair value is the price received from selling an asset or paid to transfer a liability in an orderly transaction between market participants[172](index=172&type=chunk) - The carrying amount of cash and cash equivalents and accounts receivable approximates fair value due to their **short-term maturity**[71](index=71&type=chunk) [Revenue Recognition](index=30&type=section&id=Revenue%20Recognition) Revenue is recognized under ASC 606 using a five-step model, primarily from royalty income for technology licensing over time - Revenue is recognized net of VAT, following a **five-step model under ASC 606**, when performance obligations are satisfied by transferring control of goods or services to a customer[173](index=173&type=chunk)[174](index=174&type=chunk) - Royalty income from license fees for technology rights is recognized over time as the technology rights are used by customers[176](index=176&type=chunk) [Income Taxes](index=31&type=section&id=Income%20Taxes) The company applies ASC 740 for income taxes; prior to acquisition, YYEM allocated taxable income to members, no federal tax provision - The company adopted **ASC 740, Income Taxes**, using the asset and liability method[177](index=177&type=chunk) - Prior to the acquisition by YYAI, YYEM, as a limited liability company, allocated taxable income or loss to its members, thus **no provision or liability for federal income taxes** was included in its financial statements[178](index=178&type=chunk) [Share-Based Payment](index=31&type=section&id=Share-Based%20Payment) Share-based compensation is accounted for under ASC 718, measured at grant date fair value and expensed over the vesting period - Share-based compensation is accounted for in accordance with **ASC 718**, with costs measured at grant date fair value and recognized as an expense on a straight-line basis over the vesting period[179](index=179&type=chunk) [Recent Accounting Pronouncements](index=31&type=section&id=Recent%20Accounting%20Pronouncements) The company evaluated new FASB ASUs and does not expect a material impact on its financial position, results, or cash flows - The company is evaluating the impact of several new FASB ASUs (2024-03, 2024-04, 2025-01, 2025-02, 2025-03, 2025-04, 2025-05) but does not expect a **material impact** on its financial position, results of operations, or cash flows[181](index=181&type=chunk)[182](index=182&type=chunk)[183](index=183&type=chunk)[184](index=184&type=chunk)[185](index=185&type=chunk)[186](index=186&type=chunk)[187](index=187&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=33&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section is not applicable to the company, indicating no material market risk disclosures are required - This section is **not applicable** to the company[188](index=188&type=chunk) [Item 4. Controls and Procedures](index=33&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls and procedures were effective as of July 31, 2025, with no material changes in internal control - The company's **disclosure controls and procedures** were evaluated and deemed effective as of July 31, 2025[190](index=190&type=chunk) - There were **no material changes** in internal control over financial reporting during the quarter ended July 31, 2025[191](index=191&type=chunk) [PART II - OTHER INFORMATION](index=34&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=34&type=section&id=Item%201.%20Legal%20Proceedings) No material pending or threatened legal proceedings existed that could significantly affect the company's operations - As of the issuance date, there were **no pending or threatened legal proceedings** that could reasonably be expected to have a material effect on the company's operations[194](index=194&type=chunk) - No executive officers or directors have been involved in any bankruptcy proceedings, criminal proceedings (other than minor offenses), or subject to orders limiting business involvement within the last five years[195](index=195&type=chunk) [Item 1A. Risk Factors](index=34&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the risk factors previously disclosed in the Form 10-K for the period ended April 30, 2025 - **No material changes** to the risk factors previously disclosed in the Form 10-K for the period ended April 30, 2025[196](index=196&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=34&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company completed a private placement on August 19, 2025, issuing 20 million units to raise $4.6 million - On June 30, 2025, the company executed securities purchase agreements for a private placement of **20,000,000 units** (each comprising one share of common stock and two five-year warrants with an exercise price of $0.89)[197](index=197&type=chunk) - The private placement targeted gross proceeds of **$4.6 million** and closed on August 19, 2025[197](index=197&type=chunk) [Item 3. Defaults Upon Senior Securities](index=34&type=section&id=Item%203.%20DEFAULTS%20UPON%20SENIOR%20SECURITIES.) The company reported no defaults upon senior securities - There were **no defaults upon senior securities**[198](index=198&type=chunk) [Item 4. Mine Safety Disclosures](index=34&type=section&id=Item%204.%20MINE%20SAFETY%20DISCLOSURES) This section is not applicable to the company - This section is **not applicable** to the company[199](index=199&type=chunk) [Item 5. Other Information](index=34&type=section&id=Item%205.%20OTHER%20INFORMATION.) No director or officer adopted or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter - No director or officer adopted or terminated any **'Rule 10b5-1 trading arrangement'** or **'non-Rule 10b5-1 trading arrangement'** during the quarter ended July 31, 2025[200](index=200&type=chunk) [Item 6. Exhibits](index=34&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including director agreements, the JV agreement, and certifications - Director Service and Indemnity Agreement with Bini Zhu (August 15, 2025)[201](index=201&type=chunk) - Joint Venture Agreement with JuCoin Capital Pte Ltd (August 25, 2025)[201](index=201&type=chunk) - Certifications of Principal Executive Officer and Principal Financial Officer (Rule 13a-14(a) and 18 U.S.C. 1350)[202](index=202&type=chunk) - Inline XBRL Instance Document and Taxonomy Extension Documents[202](index=202&type=chunk) [Signatures](index=36&type=section&id=SIGNATURES) [Report Signatures](index=36&type=section&id=Report%20Signatures) The report was signed on September 15, 2025, by the CEO and CFO of Connexa Sports Technologies Inc - The report was signed on **September 15, 2025**[206](index=206&type=chunk) - Signatories include **Thomas Tarala, Chief Executive Officer**, and **Guibao Ji, Chief Financial Officer and Principal Accounting Officer**[206](index=206&type=chunk)

Core Insights - Connexa Sports Technologies Inc. (YYAI) and JuCoin Capital Pte Ltd have filed a $500 million definitive agreement to establish aiRWA, a digital asset platform focused on real-world asset tokenization [1][2][3] Company Overview - YYAI will contribute $250 million in cash and digital assets, while JuCoin will match this amount, aiming to bridge traditional and digital finance [3] - JuCoin is recognized in the digital finance sector with a global platform that includes asset management and blockchain infrastructure, while YYAI brings experience in traditional finance and public company governance [4] Industry Focus - The venture targets the emerging market for real-world asset (RWA) tokenization, which aims to digitize traditional investments like real estate and government bonds, enhancing transparency and accessibility [2] - The partnership is expected to accelerate the adoption of digital financial solutions while ensuring compliance and transparency standards [4][5]

Core Insights - Connexa Sports Technologies Inc. (YYAI) and JuCoin Capital Pte Ltd have entered a $500 million agreement to establish aiRWA, a cryptocurrency exchange focused on real-world assets (RWA) [1][3] - The partnership aims to bridge traditional finance and the decentralized economy, leveraging both companies' strengths in digital asset innovation and traditional finance [3][5] - A new stablecoin, USDR, will be launched in Asia as part of their collaboration, targeting the growing stablecoin market, which exceeds $240 billion [7][10] Company Overview - JuCoin is a leading cryptocurrency exchange based in Singapore, recognized for its all-in-one digital asset platform and blockchain infrastructure [2] - YYAI, listed on Nasdaq, has expertise in traditional finance and capital markets, enhancing the partnership's potential [2] Strategic Initiatives - The joint venture will see both parties contribute $250 million each to launch aiRWA, focusing on RWA crypto trading [5][6] - aiRWA will provide deep liquidity, advanced cross-chain technology, and support for multi-asset trading, including NFTs and DeFi tokens [8] Stablecoin Development - The collaboration will drive growth in the stablecoin sector, with a focus on launching USDR and developing next-generation financing solutions [7][10] - The partnership will also explore cross-border payments and smart contract applications to expand the stablecoin ecosystem [9] Technological Advancements - The strategic memorandum includes joint R&D in AI applications to enhance financial technology and improve user experiences [10][11] - Both companies are committed to regulatory compliance and security, ensuring a sustainable and efficient digital financial ecosystem [14][15]

PART I [Business](index=5&type=section&id=Item%201.%20Business) Connexa Sports Technologies, after divesting its legacy business, now focuses on licensing AI and metaverse matchmaking technology and developing a new social networking vertical - On March 18, 2024, the Company acquired **70% of Yuanyu Enterprise Management Co., Limited (YYEM) for $56 million**, concurrently divesting its legacy "Slinger Bag" business for $1.00, making YYEM its sole operating subsidiary[16](index=16&type=chunk)[17](index=17&type=chunk) - Primary revenue is derived from licensing **six metaverse-related technologies and five AI matchmaking patents**, designed to integrate with major AI models like Huawei Pangu and Baidu Wenxinyiyan[20](index=20&type=chunk)[21](index=21&type=chunk) Fiscal Year 2025 Revenue | Metric | Value | | :--- | :--- | | Royalty Revenue | $12.8 million | - A new social networking vertical was established in February 2025 through an agreement with TikTok to produce content for the MENA region, creating an independent revenue stream[27](index=27&type=chunk) - The company has **three main licensees** for its technology, covering Japan/South Korea, UK/Europe, and Sub-Saharan Africa[35](index=35&type=chunk) [Risk Factors](index=15&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant operational, financial, and regulatory risks, including reliance on licensees, market competition, funding needs, and geopolitical exposure through its Hong Kong subsidiary - A substantial portion of revenue is dependent on intellectual property licensing agreements with third parties, and their failure to perform could significantly impact financial results[61](index=61&type=chunk)[62](index=62&type=chunk) - The love and marriage market is highly competitive with low switching costs for consumers, and competition from large, established players like Facebook's dating feature poses a significant threat[68](index=68&type=chunk)[70](index=70&type=chunk) - The company may require additional financing to fund its working capital needs and growth strategy, with no guarantee of availability on favorable terms[115](index=115&type=chunk)[116](index=116&type=chunk) - Operating a subsidiary in Hong Kong exposes the company to risks from the Chinese government, which could exercise significant oversight and control, potentially impacting operations and stock value[142](index=142&type=chunk)[148](index=148&type=chunk) - The company's former independent auditor, Olayinka Oyebola & Co. (OOC), faces SEC charges, which could impact the credibility of past financial statements for both Connexa and YYEM and potentially require restatements[125](index=125&type=chunk)[127](index=127&type=chunk) - Following the acquisition of YYEM, the former YYEM shareholder owns approximately **55.8% of the company's common stock**, enabling significant influence over corporate matters[161](index=161&type=chunk) [Unresolved Staff Comments](index=36&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) This item is not applicable to the company because it qualifies as a smaller reporting company - Not applicable to smaller reporting companies[178](index=178&type=chunk) [Cybersecurity](index=36&type=section&id=Item%201C.%20Cybersecurity) The company has established a comprehensive cybersecurity risk management framework, managed internally and overseen by the Board, with no material incidents reported for FY2025 - A cybersecurity risk management framework is in place, managed by internal IT staff with oversight from the Board of Directors[180](index=180&type=chunk)[184](index=184&type=chunk) - No cybersecurity incidents occurred during the fiscal year ended April 30, 2025, that resulted in operational interruptions or material impact[183](index=183&type=chunk) [Properties](index=38&type=section&id=Item%202.%20Properties) The company does not own any real estate, leasing its principal office in Hong Kong for HKD 42,000 monthly, with the lease expiring in August 2026 - The company leases its principal office in Hong Kong for **HKD 42,000 per month**, with the lease expiring in August 2026[186](index=186&type=chunk) [Legal Proceedings](index=38&type=section&id=Item%203.%20Legal%20Proceedings) As of the report date, the company was not involved in any pending or threatened legal proceedings expected to materially affect its operations - There are no pending or threatened legal proceedings that could materially affect the company[187](index=187&type=chunk) [Mine Safety Disclosures](index=38&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[189](index=189&type=chunk) PART II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=39&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on Nasdaq under "YYAI" with 509 holders of record as of August 7, 2025, and it has no plans to pay cash dividends, retaining earnings for operations and expansion - The company's common stock is listed on Nasdaq under the symbol **"YYAI"**[192](index=192&type=chunk) - As of August 7, 2025, there were **509 holders of record** of the common stock[193](index=193&type=chunk) - The company has never declared or paid cash dividends and does not anticipate paying any in the near future[194](index=194&type=chunk) [Selected Financial Data](index=39&type=section&id=Item%206.%20Selected%20Financial%20Data) This item is not applicable to the company because it qualifies as a smaller reporting company - Not applicable to smaller reporting companies[200](index=200&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operation](index=40&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operation) For FY2025, revenue increased by 147% to $12.8 million due to new licensing agreements, driving a 145% increase in gross profit and a 71% increase in operating income, while working capital grew 93% despite a decrease in operating cash flow due to increased accounts receivable Results of Operations (FY 2025 vs. FY 2024) | Metric | FY 2025 ($M) | FY 2024 ($M) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | $12.8 | $5.2 | +147% | | Gross Profit | $9.8 | $4.0 | +145% | | Operating Income | $6.6 | $3.9 | +71% | Cash Flow Summary (FY 2025 vs. FY 2024) | Metric | FY 2025 ($M) | FY 2024 ($M) | | :--- | :--- | :--- | | Cash Flow from Operating Activities | ($0.38) | $2.49 | | Cash Flow from Financing Activities | $0.39 | ($2.45) | - Working capital increased by **93% to $16.0 million** as of April 30, 2025, up from $8.2 million a year prior[216](index=216&type=chunk) - The decrease in operating cash flow was primarily driven by a **$10.0 million increase in accounts receivable**, as licensees have up to 90 days after year-end to pay[216](index=216&type=chunk)[218](index=218&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=47&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This item is not applicable to the company because it qualifies as a smaller reporting company - As a smaller reporting company, we are not required to provide this information[250](index=250&type=chunk) [Financial Statements and Supplementary Data](index=47&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data.) This section presents the company's audited consolidated financial statements for FY2025 and FY2024, with an unqualified opinion from Enrome LLP, reflecting the reverse acquisition accounting of YYEM and detailing key financial figures and accounting policies - The financial statements were audited by Enrome LLP, which issued an **unqualified opinion**[256](index=256&type=chunk) - The acquisition of YYEM was accounted for as a "reverse acquisition," with YYEM being the accounting acquirer and Connexa (the legal acquirer) being the accounting acquiree[281](index=281&type=chunk)[282](index=282&type=chunk) Consolidated Balance Sheet Highlights (as of April 30) | Metric | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Total Assets | 32,905,794 | 23,164,682 | | Total Liabilities | 6,487,171 | 1,442,006 | | Total Shareholders' Equity | 26,418,623 | 21,722,676 | Consolidated Statement of Operations Highlights (for the year ended April 30) | Metric | 2025 ($) | 2024 ($) | | :--- | :--- | :--- | | Revenue | 12,818,182 | 5,195,804 | | Net Income | 4,633,447 | 2,625,554 | | Net Income Attributable to Controlling Interest | 3,491,287 | 2,625,554 | - The company's three largest customers accounted for **100% of total accounts receivable and revenues** for the year ended April 30, 2025[353](index=353&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=71&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) On March 24, 2025, the company dismissed Bush & Associates CPA and engaged Enrome LLP as its new independent registered public accounting firm to improve communication efficiency, with no disagreements on accounting principles or disclosures - The company changed its independent auditor from Bush & Associates CPA to Enrome LLP on **March 24, 2025**[383](index=383&type=chunk) - The reason for the change was to address communication challenges due to the geographic locations of the auditor and management[384](index=384&type=chunk) - There were no disagreements with the former auditor on any matter of accounting principles or practices[385](index=385&type=chunk) [Controls and Procedures](index=71&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of April 30, 2025, with no material changes to internal control over financial reporting during the fiscal year - Management concluded that disclosure controls and procedures were **effective** as of the end of the fiscal year, April 30, 2025[387](index=387&type=chunk) - No material changes to internal control over financial reporting occurred during the year ended April 30, 2025[388](index=388&type=chunk) [Other Information](index=72&type=section&id=Item%209B.%20Other%20Information) This item is not applicable - Not applicable[392](index=392&type=chunk) [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=72&type=section&id=Item%209C.%20Foreign%20Jurisdictions%20that%20Prevent%20Inspection) This item is not applicable - Not applicable[393](index=393&type=chunk) PART III [Directors, Executive Officers and Corporate Governance](index=73&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) This section provides biographical details for the company's executive officers, Thomas Tarala (CEO) and Guibao Ji (CFO), and its five-member Board of Directors, which includes three independent directors and an Audit Committee Financial Expert - The company's executive officers are **Thomas Tarala (CEO)** and **Guibao Ji (CFO)**[396](index=396&type=chunk) - The Board of Directors is composed of **five members, three of whom are independent**[407](index=407&type=chunk)[408](index=408&type=chunk) - Chenlong Liu is qualified as the **Audit Committee Financial Expert**[410](index=410&type=chunk) [Executive Compensation](index=78&type=section&id=Item%2011.%20Executive%20Compensation) Executive compensation for FY2025 and FY2024 is detailed, including CEO Thomas Tarala's $720,000 base salary, $300,000 stock signing bonus, and $1,000,000 merger success fee, and CFO Guibao Ji's $250,000 annual salary, with director compensation now a $15,000 quarterly cash payment Executive Compensation (FY 2025) | Name and Principal Position | Salary ($) | Share Awards ($) | Total ($) | | :--- | :--- | :--- | :--- | | Thomas Tarala (CEO) | 320,000 | 1,300,000 | 1,620,000 | | Guibao Ji (CFO) | 111,111 | - | 111,111 | - CEO Thomas Tarala's employment agreement includes a base salary of **$720,000**, a **$300,000 signing bonus** in common stock, and a **$1,000,000 success fee** related to the YYEM merger[429](index=429&type=chunk) - CFO Guibao Ji's employment agreement provides for an annual salary of **$250,000** and a discretionary bonus[436](index=436&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=81&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) As of August 7, 2025, director Hongyu Zhou was the largest beneficial owner, holding 55.81% of the company's common stock, representing the entire ownership of all current officers and directors as a group, with 1,500,000 shares available for future issuance under the 2020 Global Share Incentive Plan Security Ownership of Major Shareholders and Management | Name | of Shares | % of Class | | :--- | :--- | :--- | | Hongyu Zhou (Director) | 8,127,572 | 55.81% | | All current officers and directors as a group (5 persons) | 8,127,572 | 55.81% | - The 2020 Global Share Incentive Plan has **1,500,000 shares of common stock** available for issuance[449](index=449&type=chunk) [Certain Relationships and Related Transactions and Director Independence](index=82&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%20and%20Director%20Independence) The company has significant related-party transactions with director Hongyu Zhou, including a $2,827,528 contingent receivable from his guarantee on an investment and a $775,406 payable to him for covered expenses - Director Hongyu Zhou has provided a guarantee on the value of the company's investment in Brightstar Technology Group, creating a contingent receivable of **$2,827,528** as of April 30, 2025[450](index=450&type=chunk) - As of April 30, 2025, the company had a payable of **$775,406** to Mr. Zhou for expenses he covered on behalf of the company[451](index=451&type=chunk) [Principal Accountant Fees and Services](index=82&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) The company incurred $200,000 in audit fees for fiscal year 2025 and $120,000 for fiscal year 2024 from its principal independent accountants, with no other fees paid for tax or other services in either year Accountant Fees | Fee Type | Fiscal 2025 ($) | Fiscal 2024 ($) | | :--- | :--- | :--- | | Audit Fees | 200,000 | 120,000 | | Tax Fees | 0 | 0 | | All Other Fees | 0 | 0 | | **Total** | **200,000** | **120,000** | PART IV [Exhibits, Financial Statement Schedules](index=83&type=section&id=Item%2015.%20Exhibit%20and%20Financial%20Statement%20Schedules) This section incorporates the company's financial statements by reference and provides a comprehensive list of all exhibits filed as part of the Annual Report on Form 10-K, including key corporate documents and material agreements - This section lists all exhibits filed with the Form 10-K, including key corporate documents and material contracts[456](index=456&type=chunk)

Acquisition and Corporate Structure - The Company acquired 70% of Yuanyu Enterprise Management Co., Limited (YYEM) for a total of $56 million, with $16.5 million paid in cash for 20% on March 20, 2024[87]. - Following the acquisition, the Company completed a share exchange transaction on November 21, 2024, acquiring an additional 50% of YYEM for 8,127,572 newly issued shares, resulting in a total ownership of 70%[88]. - The Company accounted for the acquisition of YYEM as a reverse merger, with historical operating results reflecting those of YYEM[88]. - Hongyu Zhou, the YYEM Seller, agreed to make an aggregate payment of $5 million to the Company as part of the acquisition inducement[89]. - The Company appointed new directors and officers following the acquisition, including Thomas Tarala as CEO and Guibao Ji as CFO[90]. - The Company engaged Bush & Associates CPA as its new independent registered public accounting firm for the fiscal year ended April 30, 2025, after dismissing Olayinka Oyebola & Co due to SEC charges against them[106]. Financial Performance - Net revenue increased by $8.4 million, or 581%, for the nine-month period ended January 31, 2025, and by $2.8 million, or 581%, for the three-month period ended January 31, 2025, compared to the same periods in 2024[113]. - Cost of revenue increased by $1.8 million, or 416%, for the nine-month period ended January 31, 2025, and by $600,000, or 416%, for the three-month period ended January 31, 2025, compared to the same periods in 2024[114]. - Gross profit increased by $6.6 million, or 651%, for the nine-month period ended January 31, 2025, and by $2.2 million, or 651%, for the three-month period ended January 31, 2025, compared to the same periods in 2024[114]. - General and administrative expenses increased by $2,280,120 for the nine-month period ended January 31, 2025, and by $1,996,300 for the three-month period ended January 31, 2025, from an immaterial amount in the corresponding periods in 2024[115]. - Net income from operations increased by $4.3 million for the nine-month period ended January 31, 2025, and by $196,000 for the three-month period ended January 31, 2025, compared to the same periods in 2024[117]. - Net current assets increased to $15.3 million as of January 31, 2025, from $9.0 million as of April 30, 2024, an increase of approximately $6.3 million[118]. - Accounts receivable increased by $9.1 million as royalty revenue was recognized over the period[118]. - Provision for income taxes increased by 655% for the nine-month period ended January 31, 2025, compared to the same period in 2024[117]. - The company has no outstanding indebtedness[120]. Market Focus and Operations - YYEM generated approximately $1.9 million in royalties for the fiscal year ended January 31, 2024, and has potential cumulative revenue exceeding $70 million from agreements in Japan, South Korea, Europe, and Sub-Saharan Africa over the next three years[104]. - The Company reported that the results for the nine-month period ended January 31, 2025 do not include the Legacy Business operations, as YYEM is now the operating subsidiary[105]. - A Multi-Channel Network (MCN) agency services agreement was signed in February 2025 to create content for TikTok, focusing on live-streaming and user-generated content in the Middle East and North Africa[109]. - The Company has transitioned its focus to the emerging love and marriage market sector through YYEM, which operates an AI matchmaker application[103]. Economic Outlook - The company does not believe that inflation and changes in prices will have a material effect on its operations[122].

Core Insights - Connexa Sports Technologies Inc. has announced a new agreement through its subsidiary Yuanyu Enterprise Management Limited to create and sell content for TikTok, focusing on the MENA region [1][4] - The content will include live-streaming and videos across various categories such as sports, gaming, and lifestyle, leveraging popular influencers [2][4] - TikTok's penetration in the MENA region is significant, with countries like the UAE and Saudi Arabia reporting penetration rates exceeding 120% of the adult population, presenting a lucrative market opportunity [3] Company Overview - Connexa Sports Technologies Inc. operates through its subsidiary YYEM, which is involved in the Love and Marriage sector and holds numerous patents and technologies for big data and matchmaking analyses [5]

Core Insights - Connexa Sports Technologies Inc. (YYAI) is launching a new vertical focused on social networking applications through its 70% owned subsidiary, Yuanyu Enterprise Management Limited (YYEM) [1] - The new venture will include live-streaming, voice chat rooms, gaming, and influencer-driven user-generated content (UGC) [1] - TikTok's MENA subsidiary is in advanced discussions to sign a Multi-Channel Network (MCN) contract with YYEM to purchase influencer-generated content [1][2] Market Opportunity - YYEM aims to leverage TikTok's significant reach in the MENA region, where TikTok penetration rates exceed 120% of the adult population in countries like the UAE and Saudi Arabia as of July 2024 [2] - The MENA region is viewed as a prime market for YYAI and YYEM's new venture, especially given TikTok's challenges in North America [2][3] Strategic Positioning - The partnership with TikTok is seen as a validation of YYAI's entry into the social networking market and highlights the potential of the influencer network being developed [3] - The expansion aligns with Connexa's mission to utilize technology and partnerships to unlock new opportunities in the digital landscape [3] - The combination of innovative technologies and an extensive influencer network aims to redefine content creation in one of TikTok's most engaged markets [3]

Acquisitions and Business Transactions - The company acquired 70% of Yuanyu Enterprise Management Co., Limited (YYEM) for a combined $56 million, with $16.5 million paid in cash for 20% of YYEM[181] - The company completed the purchase of 50% of YYEM's ordinary shares for 8,127,572 newly issued shares of Common Stock, representing 55.8% of the issued and outstanding shares[182] - The company sold its legacy "Slinger Bag" business to J&M Sports LLC for $1.00, transferring all related assets and liabilities[182][198] YYEM Operations and Market Performance - YYEM collected royalties of approximately $1.9 million in its fiscal year ended January 31, 2024, and has term sheets with potential cumulative revenues exceeding $70 million over the next three years[201] - YYEM operates in the love and marriage market sector with proprietary intellectual property and an AI matchmaker application integrated with Big Data models[199] - YYEM's licensee partner in China operates 200 retail stores across 40 cities, with one-time subscriber matchmaker fees reaching up to $1,500[200] Stock and Financial Instruments - The company effected a 1-for-40 reverse stock split of its common stock on September 25, 2023, increasing the aggregate number of warrants from 1,709,097 to 9,426,952[204][205] - The company filed a registration statement for 1,925,000 shares of its common stock, which became effective on August 21, 2024[207] - Proceeds from the exercise of warrants for the six months ended October 31, 2024, were $1,618,996[236] Financial Performance and Expenses - Net sales decreased by $1.93 million (-84%) for the three months ended October 31, 2024, compared to the same period in 2023, due to inventory availability issues[216] - Gross income decreased by $0.72 million (-111%) for the three months ended October 31, 2024, compared to the same period in 2023, driven by reduced net sales[217] - Selling and marketing expenses decreased by $0.71 million (-56%) for the three months ended October 31, 2024, compared to the same period in 2023, due to reduced marketing activities[218] - General and administrative expenses decreased by $0.45 million (-28%) for the three months ended October 31, 2024, compared to the same period in 2023, primarily due to insurance policy renewals and legal fees[220] - Loss from operations increased by $0.9 million (7%) for the three months ended October 31, 2024, compared to the same period in 2023, driven by reduced gross profit and operating expenses[221] - Net sales decreased by $4.35 million (-80%) for the six months ended October 31, 2024, compared to the same period in 2023, due to ongoing inventory issues[225] - Gross income decreased by $1.34 million (-87%) for the six months ended October 31, 2024, compared to the same period in 2023, driven by reduced net sales[226] - Selling and marketing expenses decreased by $0.28 million (-49%) for the six months ended October 31, 2024, compared to the same period in 2023, due to reduced marketing activities[227] - General and administrative expenses increased by $0.42 million (10%) for the six months ended October 31, 2024, compared to the same period in 2023, driven by debt settlement and legal fees[229] - Loss from operations increased by $1.45 million (48%) for the six months ended October 31, 2024, compared to the same period in 2023, due to increased operating expenses and reduced gross profit[230] - Net loss for the six months ended October 31, 2024, was $(5,586,889), with net non-cash expenses of $2,496,748[233] Cash Flow and Financial Position - Accumulated deficit as of October 31, 2024, was $(172,973,917)[232] - Net cash provided by operating activities for the six months ended October 31, 2024, was $2,726, compared to $(648,056) for the same period in 2023[232][233] - Net cash provided by financing activities for the six months ended October 31, 2024, was $1,546,328, compared to $654,479 for the same period in 2023[232][236] - Cash and cash equivalents as of October 31, 2024, were $1,642,969, compared to $229,705 as of April 30, 2024[232] - No investing activities were incurred in the six-month periods ended October 31, 2024, and 2023[234] Related-Party Transactions and Loans - Outstanding borrowings under related-party loan agreements as of October 31, 2024, were $1,169,291[238] - Accrued interest due to related parties as of October 31, 2024, was $917,957[238] - The company extended the repayment deadline for related-party loans to July 31, 2025[237]

Core Insights - Connexa Sports Technologies Inc. has acquired an additional 50% stake in Yuanyu Enterprise Management Co., Limited, increasing its total ownership to 70% [1][2] - The acquisition has led to a change of control within Connexa, resulting in the appointment of new officers and directors, as well as a spin-off of the Slinger Bag business [2] - Yuanyu Enterprise Management operates in the Love and Marriage sector, leveraging patents, technologies, and algorithms for big data and matchmaking analyses [3] Company Developments - The acquisition of YYEM is expected to enhance Connexa's position in the Love and Marriage sector, which is rapidly emerging [3] - The former CEO of Connexa expressed gratitude to shareholders and directors for their support during the acquisition process [2] - Mr. Zhou, the Chairman of YYEM, has joined Connexa's Board of Directors, indicating a strategic shift towards the Love and Marriage sector [3]

Core Points - Connexa Sports Technologies Inc. (Nasdaq: YYAI) is set to commence trading on November 22, 2024, under the YYAI ticker symbol [2][3] - The company has not yet received confirmation from Nasdaq regarding the first day of trading, but anticipates it will be on November 22 [4] Company Overview - Connexa Sports is a leading connected sports company focused on delivering products, technologies, and Sport-as-a-Service across various sports verticals [5] - The mission of Connexa is to reinvent sports through technological innovation, emphasizing a strong focus on today's sports consumer [5] Related Company Information - Yuanyu Enterprise Management Co., Limited (YYEM) operates in the Love and Marriage sector, holding numerous patents and technologies that support its big data and matchmaking analyses [5]