Netcapital (US:NCPL)2025-12-15 22:02Revenue Performance - Revenues for the three months ended October 31, 2025, decreased by $119,452, or approximately 70%, to $51,076 compared to $170,528 for the same period in 2024[133] - For the six months ended October 31, 2025, revenues were $241,134 with a gross profit of $231,848, compared to revenues of $312,755 and a gross profit of $282,754 for the same period in 2024[120] - Revenues for the six months ended October 31, 2025, decreased by $71,621, or approximately 23%, to $241,134 compared to $312,755 for the same period in 2024[140] Customer Concentration - The company had one customer that constituted 58% of revenues for the six months ended October 31, 2025, compared to one customer constituting 24% of revenues for the same period in 2024[122] Expenses - Payroll expenses increased by approximately 14% to $856,433 for the three months ended October 31, 2025, attributed to salary increases for key positions[135] - General and administrative expenses decreased by approximately 20% to $1,202,288 for the three months ended October 31, 2025, primarily due to lower legal costs[137] - Consulting expenses increased by approximately 11% to $88,635 for the three months ended October 31, 2025, due to corporate needs amid a lack of hiring full-time employees[138] - Payroll and payroll-related expenses increased by $763,589, or approximately 41%, to $2,649,883 for the six months ended October 31, 2025, due to salary increases and bonuses[143] - Interest expense increased by $28,206 to $48,271, or approximately 141%, for the six months ended October 31, 2025, compared to $20,065 in 2024[147] Funding Portal Activity - The total number of offerings on the Netcapital funding portal was 70 for both fiscal 2025 and 2024, with 21 and 17 offerings terminating without raising the required minimum capital in 2025 and 2024, respectively[121] - The number of issuers raising capital on the funding portal decreased significantly, with only 10 issuers in 2025 compared to 37 in 2024[141] - The company recorded funding portal revenues of $51,076 for the three months ended October 31, 2025, with portal fees of $14,461, listing fees of $35,000, and equity fees of $1,510[134] - Funding portal revenues for the six months ended October 31, 2025, included portal fees of $137,189, listing fees of $40,000, and equity fees of $63,705, down from $312,755 in 2024[141] Cash Flow and Financial Position - Cash and cash equivalents as of October 31, 2025, were $1,684,188, with negative working capital of $1,500,153, an improvement from negative working capital of $5,096,155 as of April 30, 2025[150] - Net cash used in operating activities amounted to $6,792,561 for the six months ended October 31, 2025, compared to $3,451,087 in 2024[157] - Net cash provided by financing activities for the six months ended October 31, 2025, was $8,187,321, significantly higher than $3,934,644 in 2024[158] Strategic Plans and Concerns - The company plans to expand its platform to support compliant blockchain-based digital assets, although this expansion has not yet occurred as of the report date[127] - The company expressed substantial doubt about its ability to continue as a going concern due to insufficient cash flows and the need for additional working capital[156] - On December 3, 2025, the company purchased substantially all of Rivetz Corp.'s assets for 950,000 shares of common stock, assuming specified liabilities capped at $100,000[128] Investment Gains - The company recorded an unrealized gain of $44,945 from an investment in a funding portal issuer during the six months ended October 31, 2025[148]