Company: NTWK
Filing Date: 2025-05-14
Form Type: 10-Q
Source: 0001641172-25-010127
Chunk: 142

Company: NETSOL TECHNOLOGIES INC
Filing Date: 2025-05-14
Form: 10-Q
Item: Part I, Item 8
Chunk 142
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The
non-GAAP measures reflect adjustments based on the following items:

EBITDA:
We report EBITDA as a non-GAAP metric by excluding the effect of net interest expense, income tax expense, depreciation and amortization
from net income or loss because doing so makes internal comparisons to our historical operating results more consistent. In addition,
we believe providing an EBITDA calculation is a more useful comparison of our operating results to the operating results of our peers.

Stock-based
compensation expense: We have excluded the effect of stock-based compensation expense from the non-GAAP adjusted EBITDA and non-GAAP
adjusted EBITDA per basic and diluted share calculations. Although stock-based compensation expense is calculated in accordance with
current GAAP and constitutes an ongoing and recurring expense, such expense is excluded from non-GAAP results because it is not an expense
which generally requires cash settlement by NetSol, and therefore is not used by us to assess the profitability of our operations. We
also believe the exclusion of stock-based compensation expense provides a more useful comparison of our operating results to the operating
results of our peers.

Non-controlling
interest: We add back the non-controlling interest in calculating gross adjusted EBITDA and then subtract out the income taxes, depreciation
and amortization and net interest expense attributable to the non-controlling interest to arrive at a net adjusted EBITDA.

Page 48

Our
reconciliation of the non-GAAP financial measures of adjusted EBITDA and non-GAAP earnings per basic and diluted share to the most comparable
GAAP measures for the three and nine months ended March 31, 2025 and 2024 are as follows:

    For
    the Three Months Ended March 31,  
    For
    the Nine Months Ended March 31, 

    2025  
    2024  
    2025  
    2024 

    Net Income (loss) attributable
    to NetSol 
    $1,423,968  
    $327,549  
    $347,721  
    $766,755 
  
    Non-controlling interest 
     410,462  
     (11,679) 
     518,212  
     822,993 
  
    Income taxes 
     151,334  
     146,569  
     712,765  
     418,517 
  
    Depreciation and amortization