Netcapital (NCPL) flags late 10-Q and higher Q3 operating costs

Rhea-AI Filing Summary

Netcapital Inc. filed a Form 12b-25 to report that its Quarterly Report on Form 10-Q for the quarter ended July 31, 2025 will be filed late, citing the need for additional time to prepare and review its quarterly financial statements. The company expects to file within the 5-day extension period allowed under SEC rules.

Based on preliminary figures, total revenues for the three months ended July 31, 2025 are expected to be about $190,058, up from $142,227 a year earlier, an increase of roughly 34%, largely driven by fees from a single issuer that generated about 73% of revenues after a successful $5 million capital raise on the company’s funding portal. At the same time, payroll expenses are expected to rise to $1,940,706 (up 71%), general and administrative costs to $1,618,506 (up 17%), marketing and rent expense also increase, interest expense rises to $36,067 (up about 245%), and new accretion expense of approximately $356,404 appears due to discounted notes sold in 2025.

Positive

• Revenue growth and successful portal raise: Preliminary revenues for the three months ended July 31, 2025 are expected at approximately $190,058, up from $142,227 (about 34%), primarily driven by fees from a single issuer’s successful $5 million funding portal raise.

Negative

• Late quarterly filing: The company will not file its Form 10-Q for the quarter ended July 31, 2025 on time and is relying on the 5-day extension under Rule 12b-25.
• High customer concentration: Approximately 73% of quarterly revenues are expected to come from a single issuer’s $5 million raise, indicating meaningful revenue concentration risk.
• Rapidly rising operating expenses: Payroll and related expenses are expected to increase 71% year over year to $1,940,706, while general and administrative expenses rise 17% to $1,618,506, pressuring profitability.
• Higher leverage and financing costs: Interest expense is expected to rise to $36,067, about 245% above the prior-year quarter, and new accretion expense of roughly $356,404 is tied to discounted notes issued in March, April and May 2025.

Insights

Equity analyst

Late 10-Q with higher revenue but sharply rising costs and new debt-related charges.

Netcapital Inc. disclosed it will file its Form 10-Q for the quarter ended July 31, 2025 late, using the 5-day grace period to complete preparation and review of its financials. This kind of delay can add uncertainty because investors must rely on preliminary numbers rather than finalized statements.

Preliminary data show total revenues for the three months ended July 31, 2025 of about $190,058, up from $142,227, a roughly 34% increase. That growth is heavily concentrated: one issuer accounts for about 73% of revenues tied to a successful $5 million raise on the company’s funding portal.

Operating and financing costs are rising much faster than revenue. Payroll and related expenses are expected at $1,940,706, up $804,113 or about 71%, while general and administrative expenses increase to $1,618,506 (up $238,250 or 17%). Interest expense jumps to $36,067, about 245% higher, and accretion expense of roughly $356,404 appears due to four discounted notes issued in March–May 2025. These figures suggest margin pressure and greater reliance on debt heading into the final, reviewed 10-Q.

SEC FILE NUMBER

001-41443

CUSIP NUMBER

64113L202

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 12b-25

NOTIFICATION OF LATE FILING

Commission file number

(Check one):	☐ Form 10-K ☐ Form 20-F ☐ Form 11-K ☒ Form 10-Q ☐ Form 10-D ☐ Form N-SAR ☐ Form N-CSR
	For Period Ended: July 31, 2025
	☐ Transition Report on Form 10-K
	☐ Transition Report on Form 20-F
	☐ Transition Report on Form 11-K
	☐ Transition Report on Form 10-Q
	☐ Transition Report on Form N-SAR
	For the Transition Period Ended: _______________

Read Instruction (on back page) Before Preparing Form. Please Print or Type.

Nothing in this form shall be construed to imply that the Commission has verified any information contained herein.

If the notification relates to a portion of the filing checked above, identify the Item(s) to which the notification relates:

PART I — REGISTRANT INFORMATION

Netcapital Inc.

Full Name of Registrant

N/A

Former Name if Applicable

1 Lincoln Street

Address of Principal Executive Office (Street and Number)

Boston, Massachusetts 02111

City, State and Zip Code

PART II — RULES 12b-25(b) AND (c)

If the subject report could not be filed without unreasonable effort or expense and the registrant seeks relief pursuant to Rule 12b-25(b), the following should be completed. (Check box if appropriate)

		(a)	The reason described in reasonable detail in Part III of this form could not be eliminated without unreasonable effort or expense;
	☒	(b)	The subject annual report, semi-annual report, transition report on Form 10-K, Form 20-F, Form 11-K, Form N-SAR or Form N-CSR, or portion thereof, will be filed on or before the fifteenth calendar day following the prescribed due date; or the subject quarterly report or transition report on Form 10-Q or subject distribution report on Form 10-D, or portion thereof, will be filed on or before the fifth calendar day following the prescribed due date; and
		(c)	The accountant’s statement or other exhibit required by Rule 12b-25(c) has been attached if applicable.

PART III — NARRATIVE

State below in reasonable detail why Forms 10-K, 20-F, 11-K, 10-Q, 10-D, N-SAR, N-CSR, or the transition report or portion thereof, could not be filed within the prescribed time period.

Netcapital Inc. (the “Company”) is unable to file its Quarterly Report on Form 10-Q for the quarter ended July 31, 2025 (the “2025 Form 10-Q”) within the prescribed time period because the Company required additional time to prepare and complete the review of its quarterly financial statements for the quarter ended July 31, 2025 to be filed with the 2025 Form 10-Q. The Company expects to file the 2025 Form 10-Q within the 5-day extension period (the “Extension Period”) afforded by Rule 12b-25 under the Securities Exchange Act of 1934, as amended.

Forward-Looking Statement

This Form 12b-25 contains forward-looking statements within the meaning of applicable United States securities laws. These forward looking statements include: (i) statements regarding the Company’s expectation to not file the 2025 Form 10-Q within the Extension Period, and (ii) statements regarding the Company’s financial results for the quarter ended July 31, 2025. Forward-looking statements are based on management’s current expectations or beliefs about the Company’s future plans, expectations and objectives. These forward-looking statements are not historical facts and are subject to risks and uncertainties that could cause the actual results to differ materially from those projected in these forward-looking statements. These risks include, but are not limited to, adjustments resulting from the completion by the Company’s auditor of their review of the 2025 Form 10-Q. Readers of this Form 12b-25 are cautioned not to place undue reliance on forward-looking statements contained herein, which speak only as of the date of this Form 12b-25.

(Attach extra Sheets if Needed)

SEC 1344 (05-06) Persons who are to respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number.

PART IV — OTHER INFORMATION

(1) Name and telephone number of person to contact in regard to this notification

Martin Kay		781		925-1700
(Name)		(Area Code)		(Telephone Number)

(2)	Have all other periodic reports required under Section 13 or 15(d) of the Securities Exchange Act of 1934 or Section 30 of the Investment Company Act of 1940 during the preceding 12 months or for such shorter period that the registrant was required to file such report(s) been filed? If answer is no, identify report(s).
Yes ☒ No ☐
(3)	Is it anticipated that any significant change in results of operations from the corresponding period for the last fiscal year will be reflected by the earnings statements to be included in the subject report or portion thereof?
	Yes ☒ No ☐
	If so, attach an explanation of the anticipated change, both narratively and quantitatively, and, if appropriate, state the reasons why a reasonable estimate of the results cannot be made. See Exhibit A attached to this Form 12b-25.

-2-

Netcapital Inc.

(Name of Registrant as Specified in Charter)

has caused this notification to be signed on its behalf by the undersigned hereunto duly authorized.

Date	September 15, 2025		By	/s/ Martin Kay
				Martin Kay
				Chief Executive Officer

ATTENTION

Intentional misstatements or omissions of fact constitute Federal Criminal Violations (See 18 U.S.C. 1001).

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Exhibit A

To

Form 12b-25

Part IV, Item (3)

Based on information that is available at this time, the Company’s total revenues for the three months ended July 31, 2025, are expected to be approximately $190,058, as compared to total revenues of $142,227 for the three months ended July 31, 2024, an increase of $47,831, or approximately 34%. The increase is primarily attributable to fees generated from one issuer that accounted for approximately 73% of our revenues in the three months ended July 31, 2025 due to a successful $5 million raise utilizing our funding portal from March 24, 2025 to May 30, 2025.

Payroll and payroll related expenses are expected to increase by $804,113, or approximately 71%, to $1,940,706 for the three months ended July 31, 2025, as compared to $1,136,593 during the three months ended July 31, 2024. The increase is primarily attributable to the salary increases and bonuses for certain key positions, to assist with employee retention, during the quarter ended July 31, 2025.

Marketing expenses are expected to increase by approximately $4,540, or approximately 66%, to $11,438 for the three months ended July 31, 2025, as compared to $6,898 during the three months ended July 31, 2024. The increase in expense is primarily attributed to new marketing efforts in the July 31, 2025 quarter to take advantage of additional cash resources.

Rent expense is expected to increase by approximately $3,736, or approximately 20%, to $22,852 for the three months ended July 31, 2025, as compared to $19,116 during the three months ended July 31, 2024. The increase is primarily attributable to a month-to-month rent agreement that we now have, as compared to an annual agreement in the prior fiscal year.

General and administrative expenses are expected to increase by approximately $238,250, or 17%, to $1,618,506 for the three months ended July 31, 2025, from $1,380,256 during the three months ended July 31, 2024. The increase is primarily attributable to increased legal costs.

Consulting expenses are expected to decrease by approximately $25,330, or 26%, to $72,051 for the three months ended July 31, 2025 from $97,381 during the three months ended July 31, 2024. The decrease is primarily attributable to a decrease in individual contractors used by the Company.

Interest expense is expected to increase by approximately $25,603 to $36,067, or approximately 245%, for the three months ended July 31, 2025, as compared to $10,464 during the three months ended July 31, 2024. The increase in interest expense is primarily attributable to increased debt amounts from notes that were sold in March, April and May of 2025.

Accretion expense is expected to amount to approximately $356,404 in the three months ended July 31, 2025. There was no accretion in the three months ended July 31, 2024. The Company sold 4 notes, and each note contained an original issuance discount that was accreted in three months ended July 31, 2025.

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FAQ

Why is Netcapital (NCPL) filing its Form 10-Q late?

Netcapital Inc. states it cannot file its Form 10-Q for the quarter ended July 31, 2025 within the prescribed time because it requires additional time to prepare and complete the review of its quarterly financial statements.

When does Netcapital expect to file the delayed 10-Q for the quarter ended July 31, 2025?

The company expects to file the Form 10-Q for the quarter ended July 31, 2025 within the 5-day extension period allowed by Rule 12b-25 under the Securities Exchange Act of 1934.

What preliminary revenues does Netcapital (NCPL) expect for the quarter ended July 31, 2025?

For the three months ended July 31, 2025, Netcapital expects total revenues of approximately $190,058, compared with $142,227 for the three months ended July 31, 2024, an increase of about 34%.

What is driving Netcapital’s revenue increase in the July 31, 2025 quarter?

The revenue increase is primarily attributable to fees from one issuer that accounted for about 73% of revenues, related to a successful $5 million raise on the company’s funding portal between March 24, 2025 and May 30, 2025.

How are Netcapital’s operating expenses changing year over year?

Payroll and related expenses are expected to rise by $804,113, or about 71%, to $1,940,706. General and administrative expenses are expected to increase by about $238,250, or 17%, to $1,618,506 for the three months ended July 31, 2025.

What changes are disclosed in Netcapital’s interest and accretion expenses?

Interest expense is expected to increase to about $36,067, roughly 245% higher than the prior-year quarter’s $10,464, mainly due to higher debt from notes sold in March, April and May 2025. Accretion expense of approximately $356,404 is expected, related to original issue discounts on four notes sold in that period.

How are other Netcapital expenses like marketing and rent expected to change?

Marketing expenses are expected to rise to about $11,438 from $6,898, and rent expense to about $22,852 from $19,116 for the three months ended July 31, 2025, reflecting new marketing efforts and a month-to-month rent agreement.