Company: WKSP
Filing Date: 2025-11-13
Form Type: 10-Q
Source: 0001493152-25-022113
Chunk: 115

Company: Worksport Ltd
Filing Date: 2025-11-13
Form: 10-Q
Item: Part I, Item 2
Chunk 115
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enses

Operating
expenses increased for the nine months ended September 30, 2025 by $3,693,990, from $12,036,688 for the nine months ended September
30, 2024 to $15,730,678, mainly due to the following factors:

    ●
    Research
    and development expense decreased by $836,382, from $1,811,911 in 2024 to $975,529 in 2025. The decrease was related to developmental
    progress of our AL3 product line and release of our AL4 product line, both of which required less development efforts as resources
    were shifted to normal-course production.

    ●
    General
    and administrative expense increased by $1,725,741, from $6,684,048 in 2024 to $8,409,789 in 2025. The increase was primarily
    attributable to increased insurance and facility support costs to sustain production efforts, increased e-Commerce fees due to higher current period
sales volume,
    and increased depreciable equipment used to support administrative and production efforts .

    ●
    Sales
    and marketing expense increased by $3,330,492, from $1,206,807 in 2024 to $4,537,299 in 2025. The increase in sales and marketing was primarily attributable to marketing campaigns to support investor relations initiatives and drive
traffic and engagement to our online marketplace for direct-to-consumer sales, including awareness campaigns for the newly released AL4
product line.

    ●
    Professional
    fees expense, which includes accounting, legal, and consulting fees, decreased by $519,879 from $2,332,069 in 2024 to $1,812,190 in
    2025. The decrease in professional fees was primarily driven by reduced reliance on external consultants as the Company progressed
    from the planning and setup phase of its manufacturing operations to active production and scaling efforts, inclusive of marketing,
    as well as a net reduction in non-cash expenditures relating to stock-based compensation for consultants.

27

Other
Income and Expenses

We
reported net other expenses for the nine months ended September 30, 2025 of $440,066, compared to $407,543 for the nine months ended
September 30, 2024. The increase in net other expenses was attributed to a reduction in rental income as a result of the completion of the term of our sublease agreement