Skkynet Cloud Systems Reports 34% Revenue Decline and Operating Loss for January 2026

Skkynet Cloud Systems, Inc. reported a significant decline in financial performance for the three months ending January 31, 2026, with revenues of $549,393, a decrease of 34% from $828,052 in the same period of the previous year. The company attributed this drop primarily to lower sales from its subsidiary, Cogent, and a strategic shift from perpetual software licenses to subscription-based models. Operating expenses also increased to $766,608 from $629,815, driven by higher salaries, consulting fees, and general administrative costs. Consequently, Skkynet recorded an operating loss of $217,215, compared to an operating income of $198,237 in the prior year.

The company's balance sheet showed total assets of $1,780,941 as of January 31, 2026, down from $1,831,014 at the end of October 2025. Current liabilities rose to $912,098, up from $803,299, leading to a decrease in stockholders' equity from $1,027,715 to $868,843. The accumulated deficit also widened to $6,676,990 from $6,447,576. The increase in liabilities was primarily due to a rise in deferred revenue, which increased to $424,545 from $347,686, reflecting the company's transition to subscription services.

Skkynet's operational metrics indicated a shift in revenue sources, with subscription revenue increasing by 271% to $73,337, while perpetual revenue fell to $476,056 from $808,289. The geographic distribution of revenue showed Europe contributing 50% of total sales, followed by North America at 39%. The company reported that seven resellers accounted for 50% of sales, with no single end-user customer exceeding 10% of gross revenue during the quarter.

Looking ahead, Skkynet has received a $1.9 million funding commitment from the Industrial AI Product Development Initiative, although no funds had been disbursed as of the reporting date. The company is focused on enhancing its cloud-based offerings and expanding its market presence, particularly in the Industrial Internet of Things sector. However, management cautioned that future performance is subject to various risks, including the ability to secure necessary capital and successfully execute its strategic initiatives. The company’s outlook remains cautious as it navigates these challenges while aiming to stabilize its financial position.