FingerMotion(FNGR) - 2025 Q2 - Quarterly Report

Financial Performance - Revenue for the three months ended August 31, 2024, was $8,458,763, a decrease of 8.8% compared to $9,279,166 for the same period in 2023[5]. - Gross profit for the six months ended August 31, 2024, was $982,917, down from $2,504,083 in the same period of 2023, reflecting a decline of 60.7%[5]. - Net loss attributable to the Company's shareholders for the six months ended August 31, 2024, was $3,344,133, compared to a loss of $1,399,552 in the same period of 2023, indicating an increase in losses of 139.4%[5]. - The company recorded revenue of $16,832,746 for the six months ended August 31, 2024, a decrease of 21.5% compared to $21,448,257 for the same period in 2023[47]. - The comprehensive loss attributable to the Company for the six months ended August 31, 2024, was $3,168,033, compared to $1,923,042 in the prior year[151]. - Basic loss per share attributable to the Company was $(0.06) for the six months ended August 31, 2024, compared to $(0.03) in the same period in 2023[151]. Assets and Liabilities - Total assets increased to $30,188,875 as of August 31, 2024, up from $18,814,814 on February 29, 2024, representing a growth of 60.5%[4]. - Current liabilities rose significantly to $20,239,541 as of August 31, 2024, compared to $6,753,915 on February 29, 2024, marking an increase of 199.5%[4]. - Total liabilities increased to $20,310,503 as of August 31, 2024, compared to $6,753,915 on February 29, 2024, representing a growth of 200.0%[4]. - Cash and cash equivalents decreased to $810,284 as of August 31, 2024, down from $1,517,232 on February 29, 2024, a decline of 46.6%[4]. - The total accumulated deficit increased to $(31,792,966) as of August 31, 2024, compared to $(26,090,866) as of August 31, 2023, marking an increase of about 22%[8]. Operating Expenses - Total operating expenses for the six months ended August 31, 2024, were $4,350,172, compared to $3,883,889 in the same period of 2023, an increase of 12.0%[5]. - The company reported a net loss from operations of $3,367,255 for the six months ended August 31, 2024, compared to a loss of $1,379,806 in the same period of 2023, reflecting an increase of 144.4%[5]. - General and administrative expenses increased by 14% to $3,429,813 for the six months ended August 31, 2024, compared to $2,996,346 for the same period in 2023[159]. - Marketing costs surged by 160% to $134,106 for the six months ended August 31, 2024, primarily due to the promotion of the newly launched Da Ge App platform[160]. Shareholder Equity and Stock Options - As of August 31, 2024, FingerMotion, Inc. reported a total stockholders' equity of $9,878,372, down from $14,210,523 as of August 31, 2023, indicating a decrease of approximately 30% year-over-year[8]. - The weighted average common shares outstanding remained stable at 52,712,850 for the three months ended August 31, 2024[5]. - The company had 52,712,850 shares of common stock issued and outstanding as of August 31, 2024, with no preferred shares issued[60]. - The company had a total of 513,312 share purchase warrants outstanding as of August 31, 2024, with a weighted average exercise price of $5.21[62]. Financing Activities - The company received $1,605,000 in subscription proceeds to purchase 1,070,000 shares at $1.50 per share on a private placement basis[171]. - On June 1, 2024, the Company entered into a loan agreement for a short-term loan facility of SGD$370,000, fully drawn for working capital purposes[81]. - A subsequent loan agreement on July 18, 2024, provided a short-term loan facility of SGD$1,500,000, of which SGD$1,000,000 has been drawn as of the report date[82]. Business Operations and Strategy - FingerMotion, Inc. has been focusing on expanding its operations in the mobile gaming sector following its acquisition of Finger Motion Company Limited in 2017[10]. - The company is focused on enhancing service offerings and expanding its reach in the PRC market[99]. - JiuGe Technology established Shanghai KeShunXiang Automobile Service Co., Ltd. to expand into communication and streaming services in China[17]. - The company is actively seeking additional capital to support the rollout of its Command & Communication business and to manage increased deposits with telecommunications entities[170]. Risks and Challenges - The company has a limited operating history, making it difficult to forecast future results and increasing the risk of not achieving profitability[196]. - A substantial portion of the company's total revenue is derived from contracts with China Unicom and China Mobile, making it vulnerable to changes in these relationships[202]. - The company faces risks related to potential security or privacy breaches that could harm its operations and brand reputation[203].