Company: KAVL
Filing Date: 2025-09-16
Form Type: 10-Q
Source: 0001731122-25-001266
Chunk: 69

Company: Kaival Brands Innovations Group, Inc.
Filing Date: 2025-09-16
Form: 10-Q
Item: Item 2
Chunk 69
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2025, we did
not accrue a provision for income taxes, due to the pre-tax loss of approximately $0.6 million. Similarly, we did not accrue a provision
for income taxes, due to the pre-tax loss of approximately $1.6 million for the third quarter of fiscal year 2024.

Net Loss:

As a result of the items noted above, the net loss
for the third quarter of fiscal year 2025 was approximately $0.6 million, or $0.05 basic and diluted net loss per share, compared to a
net loss of approximately $1.8 million, or $0.39 basic and diluted net loss per share, for the third quarter of fiscal year 2024.
The decrease in the net loss for the third quarter of fiscal year 2025, as compared to the third quarter of fiscal year 2024, is
primarily attributable to the lower sales and royalty revenue and decrease in operating expenses as noted above.

Nine months ended July 31, 2025, compared to nine
months ended July 31, 2024

Revenues:

Revenues for the nine months ended July 31, 2025,
were approximately $0.4 million, compared to $6.2 million for the nine months ended July 31, 2024. Revenues decreased during the nine
months ended July 31, 2025, compared to the nine months ended July 31, 2024, primarily due to a decrease in product sales to customers.

Cost of Revenue and Gross Profit:

Gross profit for the
nine months ended July 31, 2025, was approximately $0.4 million, compared to gross profit of approximately $2.1 million for the nine
months ended July 31, 2024. Total cost of revenue was zero for the nine months ended July 31, 2025, compared to $4.1 million for the
nine months ended July 31, 2024. The decrease in gross profit for the nine months ended July 31, 2025 compared to the nine months ended
July 31, 2024 is due to the reduction of product sales to customers during the nine months July 31, 2025.

Operating Expenses:

Total operating expenses were approximately $7.0 million
for the nine months ended July 31, 2025, compared to approximately $6.5 million for the nine months ended July 31,