NovelStem International Corp. Reports Net Income Turnaround and Significant Expense Reduction for Nine Months Ended September 30, 2025

NovelStem International Corp. reported a significant turnaround in its financial performance for the nine months ended September 30, 2025, achieving a net income of approximately $2.47 million compared to a net loss of $3.07 million for the same period in 2024. The company’s administrative fee income dropped to zero from $9,000 year-over-year, while total operating expenses decreased by 78% to $198,007, down from $893,887. This reduction in expenses was primarily attributed to lower general and administrative costs, including a notable decrease in professional fees and stock-based compensation.

The company’s balance sheet reflects a substantial decline in total assets, which fell to $14,849 from $160,111 as of December 31, 2024. Current liabilities also decreased significantly to $2.07 million from $5.30 million, largely due to the settlement of a litigation funding agreement related to the sale of its joint venture interest in NetCo. This transaction, completed in May 2025, generated $1.3 million, which was used to settle outstanding liabilities, thereby improving the company's financial position.

Operationally, NovelStem has undergone strategic changes, including the liquidation of its investment in NewStem, a biotech firm focused on cancer treatment technologies. The liquidation, finalized in August 2025, resulted in a full impairment of the investment, which had been valued at approximately $1.63 million prior to the liquidation. The company is now focused on monetizing the remaining intangible assets associated with NewStem, with potential proceeds of up to $3.75 million from future licensing agreements.

As of September 30, 2025, NovelStem had a total of 46,881,475 shares outstanding, with no dividends paid since its name change in 2018. The company continues to rely on financing from shareholders and external sources to support its operations. Management has indicated that additional fundraising will be necessary to sustain operations over the next 12 months, as the company seeks to capitalize on its remaining assets and explore potential merger or acquisition opportunities.

Looking ahead, NovelStem's management remains cautious but optimistic about the potential for future revenue generation through the monetization of its intangible assets. However, the company acknowledges the inherent risks and uncertainties associated with its ability to secure additional funding and successfully monetize its remaining assets. The financial statements reflect a going concern assumption, indicating that the company must navigate these challenges to ensure its continued viability.