Company: KAVL
Filing Date: 2025-02-10
Form Type: 10-K
Source: 0001731122-25-000185
Chunk: 554

Company: Kaival Brands Innovations Group, Inc.
Filing Date: 2025-02-10
Form: 10-K
Item: Item 4
Chunk 554
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 compared to cash flow used in operations of approximately $3.0 million for fiscal year ended
2023. The decrease in cash flows used in operations for the fiscal year ended 2024 compared to the fiscal year ended 2023 was primarily
due to changes in Other receivable – related party, Accounts receivable, Income tax receivable, and Accounts
payable – related party (such related party being our affiliate, Bidi, as described further below under Results of Operations).

Net cash flows used in investing activities was zero
for the fiscal year ended 2024, compared to approximately $0.3 million cash flow used in investing activities for the fiscal year ended
2023. The cash used in investing activities for the fiscal year ended 2023 consisted of cash used for the purchase of warehouse equipment
and used for the transaction acquisition costs associated with the purchase of the GoFire, intellectual property.

Net cash flows provided by financing activities was
approximately $4.1 million for the fiscal year ended 2024, compared to approximately $0.1 million provided by financing activities for
the fiscal year ended 2023. The cash provided by financing activities for the fiscal year ended 2024 consisted primarily from the issuance
of common shares, warrants, pre-funded warrants, and proceeds from short-term financing.

Results of Operations

Fiscal year ended October 31, 2024, compared
to fiscal year ended October 31, 2023

Revenues:

Revenues for fiscal
year ended 2024 were approximately $6.9 million, compared to approximately $13.1 million in fiscal year ended 2023. Revenues decreased
in fiscal year ended 2024, primarily due to sales pressure related to the MDO received in January 2024, which resulted in the decrease
  in the number of sticks sold to customers.

41

Cost of Revenue, Net and Gross Profit (Loss):

Gross profit in fiscal year ended 2024 was approximately
$2.6 million, compared to approximately $2.6 million for fiscal year ended 2023. Total cost of revenue was approximately $4.3 million
for fiscal year ended 2024, compared to approximately $10.5 million for fiscal year ended 2023. The slight increase in gross profit volume
is primarily driven by the decrease in cost of revenue.

Operating Expenses:

Total operating expenses were approximately $8.3 million
for fiscal year ended 2024, compared to approximately $13