Karbon-X Corp. Reports 433% Revenue Increase but $3.65 Million Net Loss for Nine Months Ending February 28, 2025

Karbon-X Corp. has reported its financial results for the nine months ending February 28, 2025, revealing significant changes in both revenue and expenses compared to the same period in the previous year. The company generated revenue of $1.53 million, a substantial increase of 433% from $287,062 in the prior year, primarily driven by the successful launch of a contract with DevvStream Holdings Inc. This contract is expected to contribute to ongoing deferred revenue streams. However, the company also reported a net loss of $3.65 million, compared to a loss of $2.16 million in the same period last year, indicating a 69% increase in operating losses.

The increase in revenue was accompanied by a dramatic rise in operating expenses, which totaled $4.41 million, up 361% from $1.02 million in the previous year. Key contributors to this increase included marketing expenses, which surged by 859% to $915,494, reflecting investments in customer acquisition and brand-building initiatives. Salaries and wages also rose significantly to $2.18 million, a 369% increase, driven by expanded headcount and wage adjustments. Professional fees and other operating expenses also saw substantial increases, reflecting the company's efforts to scale operations and enhance compliance.

In terms of operational developments, Karbon-X has made strategic moves to strengthen its leadership team, appointing Christopher Mulgrew as Chief Financial Officer. This addition is expected to enhance the company's financial management and planning capabilities as it continues to grow. The company is also focused on expanding its app and developing new partnerships, which are anticipated to further drive revenue growth in the future.

As of February 28, 2025, Karbon-X reported current assets of $6.31 million, a significant increase from $3.11 million at the end of the previous fiscal year. However, the company also faced increased liabilities, with total liabilities rising to $6.24 million from $1.14 million. The increase in liabilities was largely due to the issuance of convertible promissory notes totaling $1.21 million and a significant deferred revenue balance of $3.68 million, reflecting advance payments received for future carbon credit sales.

Looking ahead, Karbon-X acknowledges the need for additional funding to support its operations and growth strategy. The company plans to continue raising capital through private placements and other financing methods to meet its ongoing obligations and fund anticipated operating losses. The ability to secure this funding will be critical for the company's future operations and its goal of achieving profitability.