Netcapital Q3 2025 Earnings Report

Netcapital EPS Results

• Actual EPS: -$1.57
• Consensus EPS: -$0.70
• Beat/Miss: Missed by -$0.87
• One Year Ago EPS: -$13.60

Netcapital Revenue Results

• Actual Revenue: $0.15 million
• Expected Revenue: $1.13 million
• Beat/Miss: Missed by -$977.00 thousand
• YoY Revenue Growth: N/A

Netcapital Announcement Details

• Quarter: Q3 2025
• Date: 3/17/2025
• Time: Before Market Opens
• Conference Call Date: Wednesday, March 19, 2025
• Conference Call Time: 10:00AM ET

Netcapital (NASDAQ:NCPL) operates as a fintech company. It offers Netcapital.com, an SEC-registered funding portal that enables private companies to raise capital online, as well as allows investors to invest from anywhere in the world. The company also provides various services, including automated onboarding process and filing of required regulatory documents; compliance review; custom-built offering page on its portal website; third party transfer agent and custodial services; and rolling closes which provides access to liquidity before final close date of offerings, as well as assistance with annual fillings and direct access to team for ongoing support. In addition, it offers advisor services, which includes incubation of technology start-ups; investors introduction; online marketing; website design and software development; message crafting including pitch decks, offering pages, and ad creation; strategic advice; and technology consulting services. Further, the company provides valuation services, such as business valuation, fairness and solvency opinions, ESOP feasibility and valuation, non-cash charitable contribution, economic analysis of damages, intellectual property appraisals, and compensation studies. Netcapital Inc. is based in Boston, Massachusetts.

Netcapital Q3 2025 Earnings Call Transcript

Presentation

Thank you for holding. We sincerely appreciate your patience. Please stay on the line and we'll be back in

[Operator]

Good morning and welcome to the Net Capital Inc. Third Quarter Fiscal twenty twenty five Conference Call. At this time, all participants have been placed on a listen only mode, and we will open the floor for your questions and comments after the presentation. It's now my pleasure to turn the floor over to your host, Corrine Krasler, CFO of Net Capital Inc. Corrine, the floor is yours.

[Coreen Kraysler, Chief Financial Officer at Netcapital]

Thank you, Tom. Good morning, everyone, and thank you for joining Net Capital's third quarter fiscal twenty twenty five financial results conference call. I'm Corinne Kreisler, CFO of NET Capital Inc. And I will begin by reviewing our financial results and then our Chief Executive Officer, Martin Kaye, will share his prepared remarks before we open the Q and A portion of our call. Before we begin, I'd like to remind everyone of the Safe Harbor disclosure regarding forward looking information.

[Coreen Kraysler, Chief Financial Officer at Netcapital]

Management's discussion may include forward looking statements. These statements relate to future events or future financial performance and involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward looking statements. Any forward looking statements reflect management's current views with respect to operations, results of operations, growth strategy, liquidity and future events. Net capital assumes no obligation to publicly update or revise these forward looking statements for any reason or to update the reasons actual results could differ materially from those anticipated in these forward looking statements even if new information becomes available in the future. With that said, I'd like to now turn to our financial results for the second quarter fiscal twenty twenty five.

[Coreen Kraysler, Chief Financial Officer at Netcapital]

Revenues for the three months ended 01/31/2025 decreased by $890,111 or approximately 85% to $152,682 as compared to $1,042,793 during the three months ended 01/31/2024. The decline in revenue was attributed to the lack of consulting service revenue for equity securities in Q3 twenty twenty five as compared to revenue of $862,346 for consulting services for equity securities in Q3 twenty twenty four. In fiscal twenty twenty five, management has focused on establishing our broker dealer subsidiary to gain additional sources of revenue and that we have not been pursuing the equity based revenue contracts. On 11/22/2024, we received FINRA approval for our broker dealer subsidiary Net Capital Securities, Inc. We reported an operating loss of $1,687,692 for the third fiscal twenty twenty third quarter fiscal twenty twenty five as compared to an operating loss of $1,205,157 for the third quarter of fiscal twenty twenty four.

[Coreen Kraysler, Chief Financial Officer at Netcapital]

We reported a net loss for the third quarter fiscal twenty twenty five of approximately $3,000,000 6 thousand 5 hundred and 30 7 dollars as compared to a net loss of approximately $2,200,000 for the same period in the prior year. Third quarter results reflect an impairment charge of $1,300,000 for one of our portfolio companies. We reported a net loss per share of $1.57 EPS for the third quarter compared to EPS of a loss of $13.6 a share for the same period in the prior year. I'll now turn the call over to our CEO, Martin Kaye.

[Martin Kay, CEO at Netcapital]

Thank you, Corinne, and thank you to all our shareholders for being on this call today and for your continued interest and support of the company. As you heard from Corinne, we did face a tough time during the quarter. From a revenue perspective, we had a decrease, which we already touched on. And while I don't want to diminish this, I do want to look at a major success we had during the quarter with our wholly owned subsidiary Net Capital Securities Inc, or NSI, becoming a broker dealer. During the year, as a company, we have shifted some focus towards the goal of establishing Netsap Capital Securities as a broker dealer, and we successfully completed this goal following approval by the Financial Industry Regulatory Authority or FINRA in November.

[Martin Kay, CEO at Netcapital]

NSI is now approved to do three things. First, handle private placements of securities as well as referral business second, support companies raising equity capital under Reg A and Reg D, enabling larger fundraisers and potentially attracting a broader range of issuers and thirdly, partnering with other broker dealers. Looking forward, we are pleased that Algernon Neuroscience Inc. Recently engaged Net Capital Securities for one of those planned Regulation A or Reg A offerings and to provide broker dealer and administrative services. So although the market environment remains uncertain, management remains cautiously optimistic and we look forward to keeping you updated on our progress.

[Martin Kay, CEO at Netcapital]

As always, thank you for your interest and support of NET Capital. And operator, we are ready for questions.

[Operator]

Certainly. Ladies and gentlemen, the floor is now open for questions. And there are no questions in queue at this time. I would now like to turn the floor back to Martin Kaye for closing comments.

[Martin Kay, CEO at Netcapital]

Okay. Well, thank you, Tom, and thanks, Corinne, our CFO, and thank you all for joining and again for your continued interest and support of the company. Take care. Thank you.

[Operator]

Thank you. This does conclude today's conference call. You may disconnect your lines at this time and have a wonderful day. Thank you for your participation.

Participants

Executives

• Coreen Kraysler, Chief Financial Officer
• Martin Kay, CEO

Analysts