Skkynet Cloud Systems, Inc 10-Q for FY2024 Q1

Skkynet Cloud Systems, Inc. (SKKY)

10-Q 2024-03-13 For: 2024-01-31

Added on April 06, 2026

About this 10-Q

Skkynet Cloud Systems, Inc filed this 10-Q on March 13, 2024, covering the quarter ended January 31, 2024 (FY2024 Q1).

Headline figures

Quarter ended January 31, 2024, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $630.54K; up 28.1% from $492.12K a year earlier
Net income: $21.38K; compared with a net loss of $147.21K a year earlier
Diluted EPS: $0.00; compared with $0.00 a year earlier

Search and read filings like this one from Claude or ChatGPT with the SEC filings MCP server →

Nevada		45-3757848
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

2233 Argentia Road Suite 302. Mississauga, Ontario, Canada L5N 2X7
(Address of principal executive offices)

(888) 702-7851
(Issuer's telephone number)

Large accelerated filer	☐	Accelerated filed	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☐

		Page
PART I: FINANCIAL INFORMATION

Item 1. Financial Statements		4
Consolidated Balance Sheets as of January 31, 2024 (Unaudited) and October 31, 2023 (Audited)		4
Consolidated Statements of Operations and Comprehensive Income (Loss) for the Three Months Ended January 31, 2024 and 2023 (Unaudited)		5
Consolidated Statements of Changes in Stockholders’ Equity for the Three Months Ended January 31, 2024 and 2023 (Unaudited)		6
Consolidated Statements of Cash Flows for the Three Months Ended January 31, 2024 and 2023 (Unaudited)		7
Notes to Consolidated Financial Statements(Unaudited)		8

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		13

Item 3. Quantitative and Qualitative Disclosures About Market Risk		14

Item 4. Controls and Procedures		14

PART II: OTHER INFORMATION

Item 1. Legal Proceedings		16

Item 1A. Risk Factors		16

Item 2. Sales of Equity Securities and Use of Proceeds		16

Item 3. Defaults upon Senior Securities		16

Item 4. Mine Safety Information		16

Item 5. Other Information		16

Item 6. Exhibits		17

Signatures		18

	January 31, 2024			October 31, 2023
	(Unaudited)			(Audited)
ASSETS
Current Assets:
Cash and cash equivalents	$	922,098		$	916,780
Accounts receivable		367,596			306,255
Receivable related parties		-			4,695
Prepaid expenses		19,818			24,261
Total current assets		1,309,512			1,251,991

Property and equipment, net of accumulated depreciation of $90,352 and $86,930 respectively		4,085			4,554
Total Assets	$	1,313,597		$	1,256,545

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable and accrued expenses	$	129,904		$	84,870
Accrued liabilities – related party		98,770			95,865
Deferred revenue		325,445			360,170
Total current liabilities		554,119			540,905

Total liabilities		554,119			540,905

Commitments and contingencies		-			-

Stockholders’ Equity:
Preferred stock: $0.001 par value, 5,000,000 shares authorized, 5,000 shares issued and outstanding, respectively		5			5
Series B Preferred convertible stock: $0.001 par value, 500,000 shares authorized, 193,661 issued and outstanding, respectively		194			194
Common stock; $0.001 par value, 70,000,000 shares authorized, 53,143,822 shares issued and outstanding, respectively		53,145			53,145
Additional paid-in capital		7,166,880			7,146,991
Accumulative other comprehensive income		79,554			74,082
Accumulated deficit		(6,540,298	)		(6,558,777	)
Total stockholders’ equity		759,480			715,640
Total Liabilities and Stockholders’ Equity	$	1,313,597		$	1,256,545

SKKYNET CLOUD SYSTEMS, INC.
(Exact name of registrant as specified in its charter)

	For Three Months Ended January 31,
	2024			2023
Revenue	$	630,536		$	492,119
Operating Expenses:
Depreciation		611			613
Salaries and wages		239,139			195,727
Advertising		53,032			96,711
Stock compensation		19,889			52,283
General & administrative expenses		279,509			280,630
Operating expense		592,180			625,964

Income (loss) from operations		38,356			(133,845	)

Other income (expense):
Other income		2,987			10
Currency exchange		(19,959	)		(13,371	)
Total other income (expense)		(16,972	)		(13,361	)

Income (loss) before taxes		21,384			(147,206	)

Income taxes refund		-			-

Net income (loss)		21,384			(147,206	)

Preferred dividends		(2,905	)		(2,905	)

Income (loss) to common stockholders		18,479			(150,111	)

Foreign currency translation adjustment		5,472			5,484

Comprehensive income (loss)	$	23,951		$	(144,627	)

Net income (loss) per share to common stockholders- basic	$	0.00		$	(0.00	)
Weighted average common shares outstanding -basic		53,143,822			53,143,822
Net income (loss) per share to common stockholders - diluted	$	0.00		$	(0.00	)
Weighted average common shares outstanding – diluted		61,217,272			53,143,822

																		Accumulated
									Series B Preferred				Additional					Other		Total
	Common Stock				Preferred Stock				Convertible Stock				Paid-In		Accumulated			Comprehensive		Stockholders’
	Shares		Amount		Shares		Amount		Shares		Amount		Capital		Deficit			Loss (Income)		Equity
Balance at October 31, 2022		53,143,822	$	53,145		5,000	$	5		193,661	$	194	$	6,990,526	$	(6,449,285	)	$	76,011	$	670,596
Stock option expense		-		-		-		-		-		-		52,283		-			-		52,283
Change due to currency translation		-		-		-		-		-		-		-		-			5,484		5,484
Dividend accrued on series B preferred shares		-		-		-		-		-		-		-		(2,905	)		-		(2,905	)

Net loss		-		-		-		-		-		-		-		(147,206	)		-		(147,206	)

Balance at January 31, 2023		53,143,822		53,145		5,000		5		193,661		194		7,042,809		(6,599,396	)		81,495		578,252


Balance at October 31, 2023		53,143,822		53,145		5,000		5		193,661		194		7,146,991		(6,558,777	)		74,082		715,640
Change due to currency translation		-		-		-		-		-		-		-		-			5,472		5,472
Dividend accrued on series B preferred shares		-		-		-		-		-		-		-		(2,905	)		-		(2,905	)
Stock option expense		-		-		-		-		-		-		19,889		-			-		19,889

Net income (loss)		-		-		-		-		-		-		-		21,384					21,384

Balance at January 31, 2024		53,143,822	$	53,145		5,000	$	5		193,661	$	194	$	7,166,880	$	(6,540,298	)	$	79,554	$	759,480

	For the Three Months Ended January 31,
	2024			2023
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)	$	21,384		$	(147,206	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		611			613
Option based compensation		19,889			52,283
Changes in operating assets and liabilities:
Accounts receivable		(61,343	)		156,461
Accounts payable and accrued expenses		45,034			(10,956	)
Accrued liabilities – related parties		4,695			(21,419	)
Prepaid expenses and other assets		4,443			8,380
Deferred revenue		(34,725	)		(1,466	)
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES		(12	)		36,690

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from (payment on) Canadian loan activity		-			(4,118	)
NET CASH USED IN FINANCING ACTIVITIES		-			(4,118	)

Effect of exchange rate changes on cash and cash equivalents		5,330			5,350

Net increase (decrease) in cash and cash equivalents		5,318			37,922

Cash and cash equivalents, beginning of period		916,780			729,936
Cash and cash equivalents, end of period	$	922,098		$	767,858

SUPPLEMENTAL CASH FLOWS INFORMATION
Interest paid	$	-		$	-
Income taxes paid	$	-		$	-

NONCASHINVESTING AND FINANCIAL ACTIVITIES
Dividends accrued on Series B preferred shares	$	2,905		$	2,905

	1.	Identify the contract(s) with a customer.
	2.	Identify the performance obligations in the contract.
	3.	Determine the transaction price.
	4.	Allocate the transaction price to the performance obligations in the contract.
	5.	Recognize revenue when (or as) the entity satisfied the performance obligations.

	1.	Sale of software direct to the end customer
	2.	Sale of software through distributors and channel partners
	3.	Maintenance support services
	4.	Cloud services

Category	Percentage			2024		Percentage			2023
Product sales		65	%		409,276		62	%		305,059
Support		31	%		195,248		33	%		160,237
Cloud & Other		4	%		26,012		5	%		26,823
Total		100	%		630,536		100	%		492,119

Area	Percentage			2024		Percentage			2023
Europe		49	%	$	310,171		37	%	$	179,709
North America		32	%		203,807		41	%		201,039
Asia Pacific		9	%		53,780		16	%		81,044
Middle East-Africa/Other		7	%		42,824		3	%		16,765
South America		3	%		19,954		3	%		13,562
Total		100	%	$	630,536		100	%	$	492,119

	Options			Weighted Average Exercise price		Weighted Average Remaining Contract Life		Granted Options Exercisable		Intrinsic value
Outstanding at October 31,2022		6,632,450		$	0.15		4.25		5,100,960	$	256,000
Granted		1,754,750			0.19		9.25		-		-
Exercised		-			-		-		-		-
Forfeited/Expired by termination		(313,750	)		-		-		-		-
Outstanding at October 31, 2023		8,073,450		$	0.16		4.60		6,157,950	$	1,320,431
Granted		-			-		-		-		-
Exercised		-			-		-		-		-
Forfeited/Expired by termination		-			-		-		-		-
Outstanding as January 31, 2024		8,073,450		$	0.16		4.35		6,163,950	$	1,160,762

EXHIBIT 31.1		Certification of Principal Executive Officer of the Registrant pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

EXHIBIT 31.2		Certification of Principal Financial Officer of the Registrant pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

EXHIBIT 32.1		Certification of Principal Executive Officer of the Registrant pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

EXHIBIT 32.2		Certification of Principal Financial Officer of the Registrant pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS		Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)
101.SCH		Inline XBRL Taxonomy Extension Schema Document
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

	SKKYNET CLOUD SYSTEMS INC.

	By:	/s/ Andrew Thomas
		Andrew Thomas, Chief Executive Officer (Duly Authorized, Principal Executive Officer)

		/s/ Lowell Holden
		Lowell Holden, Chief Financial Officer (Duly Authorized Principal Financial Officer)
Date: March 13, 2024

	I, Andrew Thomas, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of Skkynet Cloud Systems, Inc.

2.	Based on my knowledge, this report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report.

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report.

4.	The registrant's other certifying officer and I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15 (e) and 15d-15(e) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

	(a)	Designed such disclosure controls and procedures or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared.

	(b)	Designed such internal control over financial reporting or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

	(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusion about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	(d)	Disclosed in this report any change to the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

	(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

	(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

	Date: March 13, 2024

	By:	/s/Andrew Thomas
	Name:	Andrew Thomas
	Title:	Chief Executive Officer
		(Principal Executive Officer)

	I, Lowell Holden, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of Skkynet Cloud Systems, Inc.

2.	Based on my knowledge, this report does not contain any untrue statement of material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report.

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report.

4.	The registrant's other certifying officer and I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15 (e) and 15d-15(e) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

1.	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of the Company.