Trio Petroleum (NYSE: TPET) boosts cash with $18.6M ATM and Canadian oil growth
Trio Petroleum Corp reported a smaller quarterly loss while rapidly expanding its Canadian oil footprint and strengthening liquidity. For the three months ended January 31, 2026, revenue rose to
The company posted a net loss of
Trio raised about
Positive
- Liquidity and going concern: Trio raised about
$19.0M in gross proceeds under its at-the-market program through mid-March 2026, leading management to conclude that capital is sufficient for at least twelve months and that earlier substantial doubt about continuing as a going concern has been alleviated. - Operational progress: Revenue for the quarter rose to
$122,193 , over ten times the prior-year period, as Canadian heavy-oil assets in Saskatchewan contributed roughly 3,020 barrels of production and became the company’s primary source of operating income. - Deleveraging: The August 2025 unsecured convertible notes were largely converted before January 31, 2026 and fully converted afterward, reducing notes payable from
$467,179 to$167,879 during the quarter and eliminating this debt entirely in subsequent conversions.
Negative
- Ongoing losses: Trio remains unprofitable, recording a quarterly net loss of
$1,012,629 and an accumulated deficit of about$28.4M as of January 31, 2026, with negative operating cash flow of$533,893 in the period. - Significant dilution: Common shares outstanding increased from 9,047,658 at October 31, 2025 to 12,773,916 at January 31, 2026, and further to 31,931,250 by March 16, 2026, reflecting substantial dilution from ATM issuances, stock-based consideration for acquisitions, and convertible note conversions.
- Early-stage asset base: Oil and gas properties of
$13.2M are classified as unproved and not subject to amortization, with no proved reserves yet established at key projects such as South Salinas, leaving future production and reserve growth dependent on successful development and permitting.
Insights
Large equity raise removes near-term liquidity strain but at heavy dilution.
Trio Petroleum is transitioning from early-stage U.S. projects to Canadian heavy-oil assets. Quarterly revenue grew to
The balance sheet changed materially after quarter-end. An at-the-market program raised about
This funding came almost entirely through common-stock issuance and note conversions. Shares outstanding climbed from 9,047,658 at
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TRIO PETROLEUM CORP
FORM 10-Q
For the Three Months Ended January 31, 2026
| Page | |||
| PART I. FINANCIAL INFORMATION | 3 | ||
| ITEM 1. | Financial Statements | 3 | |
| Condensed Consolidated Balance Sheets as of January 31, 2026 (unaudited) and October 31, 2025 | 3 | ||
| Condensed Consolidated Statements of Operations (unaudited) for the Three Months Ended January 31, 2026 and 2025 | 4 | ||
| Condensed Consolidated Statements of Changes in Stockholders’ Equity (unaudited) for the Three Months Ended January 31, 2026 and 2025 | 5 | ||
| Condensed Consolidated Statements of Cash Flows (unaudited) for the Three Months Ended January 31, 2026 and 2025 | 6 | ||
| Notes to Unaudited Condensed Consolidated Financial Statements | 7 | ||
| ITEM 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 18 | |
| ITEM 3. | Quantitative and Qualitative Disclosures about Market Risk | 25 | |
| ITEM 4. | Controls and Procedures | 25 | |
| PART II. OTHER INFORMATION | 26 | ||
| ITEM 1. | Legal Proceedings | 26 | |
| ITEM 1A. | Risk Factors | 26 | |
| ITEM 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 26 | |
| ITEM 3. | Defaults Upon Senior Securities | 26 | |
| ITEM 4. | Mine Safety Disclosures | 26 | |
| ITEM 5. | Other Information | 26 | |
| ITEM 6. | Exhibits | 26 | |
| SIGNATURES | 27 | ||
| 2 |
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
TRIO PETROLEUM CORP
CONDENSED CONSOLIDATED BALANCE SHEETS
| January 31, 2026 | October 31, 2025 | |||||||
| (unaudited) | ||||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash | $ | $ | ||||||
| Prepaid expenses | ||||||||
| Accounts receivable | ||||||||
| Total current assets | ||||||||
| Oil and gas properties - not subject to amortization | ||||||||
| Property, plant and equipment | - | |||||||
| Total assets | $ | $ | ||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and accrued liabilities | ||||||||
| Asset retirement obligations - current | ||||||||
| Convertible notes, net of discounts | ||||||||
| Due to operators | ||||||||
| Other current liabilities | ||||||||
| Total current liabilities | ||||||||
| Long-term liabilities: | ||||||||
| Asset retirement obligations, net of current portion | ||||||||
| Total non-current liabilities | ||||||||
| Total liabilities | ||||||||
| Commitments and Contingencies (Note 7) | - | - | ||||||
| Stockholders’ Equity: | ||||||||
| Preferred stock, $ | - | - | ||||||
| Common stock, $ | ||||||||
| Stock subscription receivable | ( | ) | ( | ) | ||||
| Additional paid-in capital | ||||||||
| Accumulated other comprehensive income | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total stockholders’ equity | ||||||||
| Total liabilities and stockholders’ equity | $ | $ | ||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
| 3 |
TRIO PETROLEUM CORP
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
| 2026 | 2025 | |||||||
| For the Three Months Ended January 31, | ||||||||
| 2026 | 2025 | |||||||
| Revenues, net | $ | $ | ||||||
| Cost of goods sold | - | |||||||
| Gross profit | ||||||||
| Operating expenses: | ||||||||
| Exploration expense | ||||||||
| General and administrative expense | ||||||||
| Stock-based compensation expense | ||||||||
| Accretion expense | ||||||||
| Total operating expenses | ||||||||
| Loss from operations | ( | ) | ( | ) | ||||
| Other expenses: | ||||||||
| Interest expense | ||||||||
| Loss on conversion | ||||||||
| Total other expenses | ||||||||
| Loss before income taxes | ( | ) | ( | ) | ||||
| Provision for income taxes | - | - | ||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Basic and Diluted Net Loss per Common Share | ||||||||
| Basic | $ | ( | ) | $ | ( | ) | ||
| Diluted | $ | ( | ) | $ | ( | ) | ||
| Weighted Average Number of Common Shares Outstanding | ||||||||
| Basic | ||||||||
| Diluted | ||||||||
| Comprehensive loss: | ||||||||
| Net loss | ( | ) | ( | ) | ||||
| Foreign currency translation adjustment | - | |||||||
| Comprehensive loss | $ | ( | ) | $ | ( | ) | ||
The accompanying notes are an integral part of these condensed consolidated financial statements.
| 4 |
TRIO PETROLEUM CORP
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
FOR THE THREE MONTHS ENDED JANUARY 31, 2026 AND 2025
| Shares | Amount | Payable | Capital | Income | Deficit | Equity | ||||||||||||||||||||||
| Stock | Accumulated | |||||||||||||||||||||||||||
| Subscription | Additional | Other | Total | |||||||||||||||||||||||||
| Common Stock | Receivable/ | Paid-in | Comprehensive | Accumulated | Stockholders’ | |||||||||||||||||||||||
| Shares | Amount | Payable | Capital | Income | Deficit | Equity | ||||||||||||||||||||||
| Balance at October 31, 2024 | $ | $ | ( | ) | $ | $ | - | $ | ( | ) | $ | |||||||||||||||||
| Issuance of common shares to executives and board members | - | ( | ) | - | - | - | ||||||||||||||||||||||
| Issuance of common shares in connection with an at-the-market offering program | - | - | - | |||||||||||||||||||||||||
| Issuance of common shares in lieu of cash payments on promissory notes | - | - | - | |||||||||||||||||||||||||
| Issuance of beneficial ownership round-up shares for participants | - | ( | ) | - | - | - | ||||||||||||||||||||||
| Stock-based compensation | - | - | - | - | - | |||||||||||||||||||||||
| Net loss | - | - | - | - | - | ( | ) | ( | ) | |||||||||||||||||||
| Balance at January 31, 2025 | $ | $ | ( | ) | $ | $ | - | $ | ( | ) | $ | |||||||||||||||||
| Balance at October 31, 2025 | ( | ) | ( | ) | ||||||||||||||||||||||||
| Balance | ( | ) | ( | ) | ||||||||||||||||||||||||
| Issuance of common shares in connection with an at-the-market offering program | - | - | - | |||||||||||||||||||||||||
| Issuance of common shares in lieu of cash payments on promissory notes | - | - | - | |||||||||||||||||||||||||
| Issuance of common share in connection with asset acquisition | - | - | - | |||||||||||||||||||||||||
| Issuance of common shares to a consultant | - | - | - | |||||||||||||||||||||||||
| Issuance of common shares to executives and board members | - | ( | ) | - | - | - | ||||||||||||||||||||||
| Stock-based compensation | - | - | - | - | - | |||||||||||||||||||||||
| Net loss | - | - | - | - | - | ( | ) | ( | ) | |||||||||||||||||||
| Other comprehensive income | - | - | - | - | - | |||||||||||||||||||||||
| Balance at January 31, 2026 | ( | ) | ( | ) | ||||||||||||||||||||||||
| Balance | ( | ) | ( | ) | ||||||||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
| 5 |
TRIO PETROLEUM CORP
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
| 2026 | 2025 | |||||||
| For the Three Months Ended January 31, | ||||||||
| 2026 | 2025 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Issuance of common shares for services | - | |||||||
| Accretion expense | ||||||||
| Amortization of debt discounts | ||||||||
| Stock-based compensation | ||||||||
| Loss on issuance of common shares in lieu of cash for debt payments | ||||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | - | |||||||
| Prepaid expenses and other receivables | ( | ) | ||||||
| Accounts payable and accrued liabilities | ( | ) | ||||||
| Other liabilities | ( | ) | ( | ) | ||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Cash paid for asset acquisition | ( | ) | ( | ) | ||||
| Due to operators | ( | ) | ||||||
| Net cash provided by (used in) investing activities | ( | ) | ||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Proceeds from issuance of common stock under at-the-market offering program | ||||||||
| Repayment of promissory notes | - | ( | ) | |||||
| Repayment of notes payable - related party | - | ( | ) | |||||
| Net cash provided by financing activities | ||||||||
| Effect of foreign currency exchange | ( | ) | - | |||||
| NET CHANGE IN CASH | ( | ) | ||||||
| Cash - Beginning of period | ||||||||
| Cash - End of period | $ | $ | ||||||
| Supplemental disclosures of cash flow information: | ||||||||
| Cash paid for interest | $ | - | $ | - | ||||
| Cash paid for income taxes | $ | - | $ | - | ||||
| SUPPLEMENTAL CASH FLOW INFORMATION: | ||||||||
| Non-cash investing and financing activities: | ||||||||
| Issuance of common stock upon vesting of RSUs | $ | $ | - | |||||
| ARO liability recognized | $ | $ | - | |||||
| Issuance of common shares for Capital Lands asset acquisition | $ | $ | - | |||||
| Issuance of common shares for Novacor asset acquisition | $ | $ | - | |||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
| 6 |
TRIO PETROLEUM CORP
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED JANUARY 31, 2026
NOTE 1 – NATURE OF THE ORGANIZATION AND BUSINESS
Company Overview
Trio Petroleum Corp (“Trio Petroleum,” the “Company,” or “TPET”) is a Delaware-incorporated oil and gas exploration and development company headquartered in Bakersfield, California. The Company focuses on acquiring, financing, and operating oil and gas projects in the United States and Canada. Its current portfolio includes the South Salinas Project in Monterey County, California, the PR Spring Project in Uintah County, Utah, and heavy-oil assets in the Lloydminster region of Saskatchewan, Canada.
Nature of Operations
The Company commenced revenue-generating operations in February 2024 at the McCool Ranch Oil Field in California. Operations at McCool Ranch were discontinued in May 2025, and all related leases were terminated. Revenues from the Company’s Saskatchewan assets, acquired through the Novacor transaction in April 2025, continued through the three months ended January 31, 2026. As of January 31, 2026, all producing wells were located in Saskatchewan.
Operational Focus
The Company continues to shift its operational emphasis toward jurisdictions with more favorable economic conditions, including Utah and Canada, while maintaining its interests in California. The South Salinas Project remains in evaluation status, and no proved reserves have been established as of January 31, 2026.
Canadian Operations and Recent Acquisitions
Trio Petroleum Canada Corp (“Trio Canada”), a wholly owned subsidiary formed in March 2025, holds the Company’s Canadian assets. During the quarter ended January 31, 2026, Trio Canada completed two additional acquisitions of oil and gas assets in Canada. On November 3, 2025, the Company acquired certain unproved petroleum and natural gas lease rights in Alberta for cash and common stock consideration. On December 30, 2025, the Company acquired additional oil and gas assets in the Lloydminster, Saskatchewan heavy oil region, with consideration paid in common stock. Both transactions are being accounted for as asset acquisitions under ASC 805-50, and the acquired assets have been recorded as unproved oil and gas properties.
Equity Offering
On
January 9, 2026, the Company entered into an At Market Issuance Sales Agreement with Ladenburg Thalmann & Co. Inc., permitting the
sale of up to $
Emerging Growth Company
The Company is an “emerging growth company” under the Jumpstart Our Business Startups Act of 2012 and has elected to use the extended transition period for adopting new or revised accounting standards.
Subsequent Events
The Company evaluated subsequent events after January 31, 2026 through the date these condensed consolidated financial statements were issued. Subsequent to January 31, 2026, the Company continued to sell shares of its common stock under its At Market Issuance Sales Agreement with Ladenburg Thalmann & Co. Inc. The Company raised additional capital under the program during this period. In addition, the holders of our unsecured convertible promissory notes issued in August 2025 elected to convert the remaining outstanding principal balance of the notes into shares of our common stock after the end of the quarter. Further details regarding these subsequent ATM sales and the note conversions are provided in Note 10 – Subsequent Events. Management did not identify any other events requiring recognition or additional disclosure.
| 7 |
NOTE 2 –SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation and Consolidation
The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. They do not include all of the information and footnotes required for complete annual financial statements and should be read in conjunction with the Company’s audited consolidated financial statements included in its Annual Report on Form 10-K for the year ended October 31, 2025. The condensed consolidated financial statements include the accounts of Trio Petroleum Corp and its wholly owned subsidiary, Trio Petroleum Canada Corp, and all significant intercompany balances and transactions have been eliminated. In the opinion of management, all normal recurring adjustments considered necessary for a fair presentation have been included. Operating results for the three months ended January 31, 2026 are not necessarily indicative of results for the full fiscal year.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses, and related disclosures. Significant estimates include the evaluation of oil and natural gas properties, asset retirement obligations, the assessment of unproved properties, the valuation of equity-based transactions, and the determination of deferred tax assets and related valuation allowances. Actual results could differ from those estimates.
Foreign Currency Translation
The Company’s reporting currency is the United States dollar. The functional currency of Trio Petroleum Canada Corp is the Canadian dollar. Assets and liabilities of the foreign subsidiary are translated at exchange rates in effect at the balance sheet date, and income and expense items are translated at average exchange rates for the period. Resulting translation adjustments are recorded in accumulated other comprehensive income. Foreign currency transaction gains and losses are recognized in earnings as incurred.
Oil and Gas Properties
The Company applies the successful efforts method of accounting for its oil and natural gas properties. Geological and geophysical costs, delay rentals, and exploratory costs are expensed as incurred. Costs of exploratory wells are capitalized pending the determination of whether proved reserves have been found; if proved reserves are not established, the related costs are expensed. Costs to acquire mineral interests, drill and equip exploratory wells that find proved reserves, and drill and equip development wells are capitalized. Unproved properties are assessed periodically for impairment based on remaining lease terms, drilling results, and future development plans. Proved properties are depleted using the unit-of-production method based on estimated proved reserves. The Company evaluates its long-lived assets, including proved oil and natural gas properties, for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.
Asset Retirement Obligations
The Company recognizes asset retirement obligations for the estimated future costs of plugging and abandoning oil and natural gas wells. The fair value of the obligation is recorded in the period in which the liability is incurred, with a corresponding increase to the carrying amount of the related asset. The liability is accreted to its present value each period, and the capitalized cost is depreciated over the useful life of the related asset. The obligation is adjusted for revisions in estimated timing or amount of expected cash flows.
| 8 |
Revenue Recognition
Revenue is recognized in accordance with ASC 606, Revenue from Contracts with Customers. The Company’s revenues are derived from the sale of crude oil. Control transfers to the customer at the time of delivery, which is the point at which revenue is recognized. Revenue is measured based on the consideration specified in the contract, which may include adjustments for market differentials and transportation-related charges. The Company’s oil is sold to a single customer, and payment is typically received in the month following delivery.
Income Taxes
The Company accounts for income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for temporary differences between the financial reporting and tax bases of assets and liabilities and for net operating loss carryforwards. A valuation allowance is recorded when it is more likely than not that deferred tax assets will not be realized. The Company’s deferred tax assets continue to be fully reserved. The Company recognizes the effect of uncertain tax positions only when it is more likely than not that such positions will be sustained upon examination. Interest and penalties related to uncertain tax positions are recognized in income tax expense.
Fair Value Measurements
The Company measures certain assets and liabilities at fair value in accordance with ASC 820, Fair Value Measurements. Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The fair value of equity consideration issued in connection with asset acquisitions is measured based on the market price of the Company’s common stock on the acquisition date, without adjustment for resale restrictions. The carrying amounts of cash, payables, and other short-term financial instruments approximate fair value due to their short-term nature. Certain estimates used in evaluating oil and natural gas properties and asset retirement obligations involve significant unobservable inputs and are therefore classified as Level 3 measurements.
Net Loss Per Share
Basic and diluted net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding during the period. Diluted net loss per share is the same as basic net loss per share because the inclusion of potentially dilutive securities would be anti-dilutive.
Environmental Expenditures
Environmental expenditures are expensed or capitalized depending on their nature and future economic benefit. Expenditures that relate to ongoing environmental compliance are expensed as incurred, while expenditures that improve the future economic benefit of an asset are capitalized.
Recent Accounting Pronouncements
Management has evaluated recently issued accounting pronouncements and has determined that none are expected to have a material impact on the Company’s condensed consolidated financial statements.
Reclassifications
Certain prior-period amounts have been reclassified to conform to the current period presentation. These reclassifications had no effect on previously reported net income or stockholders’ equity.
| 9 |
NOTE 3 – GOING CONCERN AND MANAGEMENT’S LIQUIDITY PLANS
As
of January 31, 2026, the Company had cash of approximately $
During
the three months ended January 31, 2026, the Company raised approximately $
Management evaluated whether these capital raises, together with the Company’s operating plans, alleviate the conditions that initially raised substantial doubt about the Company’s ability to continue as a going concern. Based on the additional capital raised after January 31, 2026 and prior to issuance of these financial statements, management concluded that its plans are probable of being effectively implemented and sufficient to address the Company’s liquidity needs for the twelve-month period following issuance. Accordingly, while substantial doubt existed as of January 31, 2026, management’s plans have alleviated that substantial doubt.
These condensed consolidated financial statements have been prepared on a going-concern basis and do not include any adjustments that might result from the outcome of this uncertainty.
NOTE 4 – REVENUE FROM CONTRACTS WITH CUSTOMERS
Disaggregation of Revenue from Contracts with Customers
The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers. Revenue is derived from the sale of crude oil, and control transfers to the customer at the time of delivery. Revenue is measured based on the consideration specified in the contract, which may include adjustments for market differentials and transportation-related charges. The Company sells its crude oil to a single customer, and payment is typically received in the month following delivery.
Revenue for the three months ended January 31, 2026 was generated entirely from oil sales produced from the Company’s Saskatchewan properties. The following table presents revenue disaggregated by product type for the periods presented:
SCHEDULE OF DISAGGREGATES REVENUE
| For
the three months ended |
For
the three months ended |
|||||||
| January 31, 2026 | January 31, 2025 | |||||||
| Oil sales | $ | $ | ||||||
| Total revenues from customers | $ | $ | ||||||
There
were
| 10 |
Significant concentrations of credit risk
The Company’s revenue is concentrated with a single customer who purchases crude oil produced from the Company’s Canadian operations. Changes in regional market conditions, commodity pricing, or regulatory environments in Saskatchewan could materially impact future revenues.
NOTE 5 – OIL AND NATURAL GAS PROPERTIES
The following tables summarize the Company’s oil and gas activities.
SCHEDULE OF OIL AND NATURAL GAS PROPERTIES
As of January 31, 2026 | As of October 31, 2025 | |||||||
| Oil and gas properties – not subject to amortization | $ | $ | ||||||
| Accumulated impairment | — | — | ||||||
| Oil and gas properties – not subject to amortization, net | $ | $ | ||||||
The Company applies the successful efforts method of accounting for its oil and natural gas properties. Costs of geological and geophysical activities, delay rentals, and exploratory activities are expensed as incurred. Costs of exploratory wells are capitalized pending the determination of whether proved reserves have been found; if proved reserves are not established, the related costs are expensed. Costs to acquire mineral interests and to drill and equip exploratory and development wells that find proved reserves are capitalized. Unproved properties are not amortized and are assessed periodically for impairment based on remaining lease terms, drilling results, and future development plans. Proved properties are depleted using the unit-of-production method based on estimated proved reserves. The Company evaluates its long-lived assets, including proved oil and natural gas properties, for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.
During
the three months ended January 31, 2026, the Company completed two asset acquisitions in Canada that were accounted for as asset acquisitions
under ASC 805-50. On November 3, 2025, the Company acquired certain unproved petroleum and natural gas lease rights located in Alberta,
Canada from Capital Land Services Ltd. Total consideration consisted of CAD $
On
December 30, 2025, the Company acquired additional oil and gas assets in the Lloydminster, Saskatchewan heavy oil region from Novacor
Exploration Ltd. for total consideration of CAD $
In
connection with the Novacor acquisition, the Company recognized an initial asset retirement obligation of approximately CAD $
As
of January 31, 2026, all Canadian properties acquired during the period were classified as unproved oil and gas properties.
| 11 |
NOTE 6 – RELATED PARTY TRANSACTIONS
South Salinas Project – Related Party
Trio
LLC operates the South Salinas Project on behalf of the Company under a Joint Operating Agreement. Trio LLC holds a
McCool Ranch Oil Field Asset Purchase – Related Party
On
May 27, 2025, the Company terminated the McCool Ranch Oil Field leases previously acquired from Trio LLC. All capitalized costs totaling
$
Director RSUs – June 19, 2024 Grant
On
June 19, 2024, the Board approved the grant of
As
of October 31, 2025, the Company had $
Chief Executive Officer RSUs – July 11, 2024 Grant
On
July 11, 2024, the Company entered into an employment agreement with Mr. Robin Ross, pursuant to which he was appointed Chief Executive
Officer. In connection with his appointment, Mr. Ross was granted
As
of October 31, 2025, the Company had $
During the three months ended January 31, 2026, the Company recognized $
Other Executive and Director RSUs
All
other RSU awards granted to directors and executives during fiscal 2025 were fully vested and fully expensed as of October 31, 2025.
Consulting Agreement – Chief Financial Officer
The
Company’s prior independent contractor agreement with its Chief Financial Officer expired on December 31, 2025. Effective
January 1, 2026, the Company entered into a new independent contractor agreement under which he
receives a monthly fee of $
Consulting Agreement – Stanford Eschner
On
August 1, 2025, the Company entered into a consulting agreement with Mr. Stanford Eschner following his resignation as Vice Chairman
and director. Under the agreement, Mr. Eschner receives a monthly fee of $
Loan to Trio Canada
On
April 4, 2025, the Company entered into a Loan and Note Purchase Agreement with Trio Petroleum Canada Corp, issuing a
During
the period ended January 31, 2026, the Company paid $
| 12 |
NOTE 7 – COMMITMENTS AND CONTINGENCIES
Legal Matters
From time to time, the Company may be subject to claims and legal proceedings arising in the ordinary course of business. Management currently believes that any potential liabilities arising from such matters will not have a material adverse effect on the Company’s financial position, results of operations, or cash flows. As of January 31, 2026, the Company was not involved in any material pending legal proceedings.
Unproved Property Leases
South Salinas Project
The Company holds various leases related to unproved properties in the South Salinas Project. Two leases with the same lessor remain active:
| ● | Lease
1 ( | |
| ● | Lease
2 ( |
All additional South Salinas leases entered into during 2023 were abandoned during fiscal 2025 following an evaluation of economic and operational factors. No further obligations remain under the abandoned leases.
Proved Property Leases – Saskatchewan, Canada
In
April 2025, the Company acquired oil and gas lease rights for four proved properties located in Saskatchewan, Canada. The leases total
Board of Directors Compensation
Under
a compensation plan approved on July 11, 2022, non-employee directors are entitled to an annual cash retainer of $
Agreements with Advisors
The Company previously entered into placement agent agreements with Spartan Capital Securities, LLC (“Spartan”) in connection with its IPO and subsequent private placements. Under these agreements, Spartan received cash fees and warrants to purchase common stock. All warrants issued to Spartan remain outstanding as of January 31, 2026. No new placement agent agreements were entered into, and no additional fees or warrants were incurred or issued during the three months ended January 31, 2026.
| 13 |
NOTE 8 – NOTES PAYABLE
As of January 31, 2026, the Company had one outstanding note payable related to the August 2025 Financing described below. All other notes disclosed in the Company’s Annual Report on Form 10-K for the year ended October 31, 2025 were fully repaid, converted, or otherwise extinguished prior to the current reporting period.
The following table summarizes notes payable as of January 31, 2026 and October 31, 2025:
SCHEDULE OF NOTES PAYABLE
As of January 31, 2026 | As of October 31, 2025 | |||||||
| Promissory notes, net of discounts | $ | $ | ||||||
| Total Notes payable | $ | $ | ||||||
August 2025 Financing
On
August 15, 2025, the Company closed a private placement pursuant to which it issued three unsecured convertible promissory notes (the
“Notes”) to institutional investors in an aggregate principal amount of $
| ● | $1.32, or | |
| ● | 90% of the lowest daily VWAP during the five trading days prior to conversion, |
subject to a floor price of $0.72, which may adjust under certain circumstances but not below $0.22.
The
Notes also include provisions allowing the Company to require conversion under specified trading and registration conditions, subject
to beneficial ownership limitations of 4.99% (or 9.99% if elected by the investor). The maximum number of shares issuable upon conversion
is
Between
September 12 and October 23, 2025, investors converted $
Following
these conversions, the Notes had a remaining principal balance of $
Between
December 2, 2025 and January 14, 2026, investors converted $
| 14 |
NOTE 9 – STOCKHOLDERS’ EQUITY
Common Shares
The
Company is authorized to issue
Consultant Issuances
On
January 1, 2026, the Company issued
Because
the shares were issued in advance of the service period, the Company is recognizing expense on a straight-line basis over the six-month
term of the agreement. For the three months ended January 31, 2026, the Company recognized $
Issuances to Executives and Directors
During
the period ended January 31, 2026, the Company issued
Debt Conversions
During
the three months ended January 31, 2026, the Company issued
The
fair value of the shares issued exceeded the principal amounts settled, resulting in a loss on conversion of $
Asset Acquisition Issuances
During the period ended January 31, 2026, the Company issued shares as equity consideration in connection with two asset acquisitions (see Note 5):
| ● | Capital Lands acquisition: | |
| ● | December 2025 Novacor acquisition: | |
These amounts were capitalized as unproved oil and gas properties
At-the-Market (“ATM”) Offering Program
During
the three months ended January 31, 2026, the Company sold
Stock-based Compensation – Restricted Shares
During
the three months ended January 31, 2026, the Company recognized $
| 15 |
Warrants
A summary of the warrant activity during the three months ended January 31, 2026 is presented below:
SCHEDULE OF WARRANT ACTIVITY
| Weighted | ||||||||||||||||
| Weighted | Average | |||||||||||||||
| Average | Remaining | |||||||||||||||
Number of Warrants | Exercise Price | Life in Years | Intrinsic Value | |||||||||||||
| Outstanding, November 1, 2025 | $ | $ | ||||||||||||||
| Issued | - | - | - | - | ||||||||||||
| Outstanding, January 31, 2026 | $ | $ | ||||||||||||||
| Exercisable, January 31, 2026 | $ | $ | ||||||||||||||
A summary of the warrant activity during the three months ended January 31, 2025 is presented below:
| Weighted | ||||||||||||||||
| Weighted | Average | |||||||||||||||
| Average | Remaining | |||||||||||||||
Number of Warrants | Exercise Price | Life in Years | Intrinsic Value | |||||||||||||
| Outstanding, November 1, 2024 | $ | $ | ||||||||||||||
| Expired | ( | ) | - | - | ||||||||||||
| Outstanding, January 31, 2025 | $ | $ | ||||||||||||||
| Exercisable, January 31, 2025 | $ | $ | ||||||||||||||
A summary of outstanding and exercisable warrants as of January 31, 2026 is presented below:
SCHEDULE OF OUTSTANDING AND EXERCISABLE WARRANTS
| Warrants Outstanding | Warrants Exercisable | |||||||||||||
Exercise Price | Number of Shares | Weighted Average Remaining Life in Years | Number of Shares | |||||||||||
| $ | ||||||||||||||
| $ | ||||||||||||||
| $ | ||||||||||||||
| $ | ||||||||||||||
| $ | ||||||||||||||
| $ | ||||||||||||||
| $ | ||||||||||||||
| 16 |
Stock Options
A summary of option activity during the three months ended January 31, 2026 is presented below:
SCHEDULE OF STOCK OPTION ACTIVITY
Number of Options | Weighted Average Exercise | Weighted Average Remaining Life in | Intrinsic Value | |||||||||||||
| Outstanding, November 1, 2025 | $ | $ | - | |||||||||||||
| Issued | - | - | - | - | ||||||||||||
| Outstanding, January 31, 2026 | $ | $ | - | |||||||||||||
| Exercisable, January 31, 2026 | $ | $ | - | |||||||||||||
A summary of option activity during the three months ended January 31, 2025 is presented below:
Number of Options | Weighted Average Exercise | Weighted Average Remaining Life in | Intrinsic Value | |||||||||||||
| Outstanding, November 1, 2024 | $ | $ | - | |||||||||||||
| Issued | - | - | - | - | ||||||||||||
| Outstanding, January 31, 2025 | $ | $ | - | |||||||||||||
| Exercisable, January 31, 2025 | $ | $ | - | |||||||||||||
A summary of outstanding and exercisable options as of January 31, 2026 is presented below:
SCHEDULE OF OUTSTANDING AND EXERCISABLE OPTIONS
| Options Outstanding | Options Exercisable | |||||||||||||
Exercise Price | Number of Shares | Weighted Average Remaining Life in Years | Number of Shares | |||||||||||
| $ | ||||||||||||||
NOTE 10 – SUBSEQUENT EVENTS
At the Market Offering
Subsequent to January 31, 2026, the Company continued
to issue shares of its common stock under its At Market Issuance Sales Agreement with Ladenburg Thalmann & Co. Inc. Between February
1, 2026 and March 17, 2026, the Company sold an aggregate of
The Company may continue to offer and sell additional shares under the ATM program from time to time, subject to market conditions and the terms of the sales agreement.
August 2025 Convertible Note
Subsequent to January 31, 2026, the holders of the
Company’s unsecured convertible promissory notes issued in August 2025 elected to convert the remaining outstanding principal balance
of the notes into shares of the Company’s common stock. Between February 1, 2026 and the date these condensed consolidated financial
statements were issued, the noteholders converted an aggregate of $
The fair value of the common stock issued upon conversion
exceeded the carrying amount of the debt settled, resulting in a loss on conversion of approximately $
No other subsequent events requiring recognition or disclosure were identified through the date these condensed consolidated financial statements were issued.
| 17 |
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
You should read the following discussion and analysis of financial condition and operating results together with our condensed consolidated financial statements and the related notes and other financial information included elsewhere in this quarterly report on Form 10-Q, as well as our audited financial statements and related notes as disclosed in our Form 10-K for the year ended October 31, 2025, filed with the SEC on January 20, 2026 (“our Form 10-K”). This discussion contains forward-looking statements that involve risks and uncertainties. As a result of many factors, such as those in this Quarterly Report on Form 10-Q, as well as the risk factors set forth in the section titled “Risk Factors” included in our Form 10-K, our actual results may differ materially from those anticipated in these forward-looking statements. For convenience of presentation some of the numbers have been rounded in the text below.
Throughout this report, the terms “our,” “we,” “us,” and the “Company” refer to Trio Petroleum Corp
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains forward-looking statements that can involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this Quarterly Report, including statements regarding our future results of operations and financial position, business strategy, prospective products, product approvals, research and development costs, future revenue, timing and likelihood of success, plans and objectives of management for future operations, future results of anticipated products and prospects, plans and objectives of management are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.
In some cases, you can identify forward-looking statements by terms such as “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” or “would” or the negative of these terms or other similar expressions, although not all forward-looking statements contain these words. Risks, risk factors and uncertainties involved in forward-looking statements contained in this Form 10-Q include, but are not limited to, the following:
| ● | our ability to find, acquire or gain access to other properties, discoveries and prospects and to successfully develop our current properties, discoveries and prospects; | |
| ● | uncertainties inherent in making estimates of our oil and natural gas resources; | |
| ● | the successful implementation of our prospective discovery, development and drilling plans with the South Salinas Project; | |
| ● | projected and targeted capital expenditures and other costs, commitments and revenues; | |
| ● | our dependence on our key management personnel and our ability to attract and retain qualified technical personnel; | |
| ● | the ability to obtain financing and the terms under which such financing may be available; | |
| ● | the volatility of oil and natural gas prices; | |
| ● | the availability and cost of developing appropriate infrastructure around and transportation to our discoveries and prospects; | |
| ● | the availability and cost of drilling rigs, production equipment, supplies, personnel and oilfield services; | |
| ● | other competitive pressures; | |
| ● | potential liabilities inherent in oil and natural gas operations, including drilling risks and other operational and environmental hazards; | |
| ● | current and future government regulation of the oil and gas industry; | |
| ● | cost of compliance with laws and regulations; | |
| ● | changes in environmental, health and safety or climate change laws, greenhouse gas regulation or the implementation of those laws and regulations; | |
| ● | environmental liabilities; | |
| ● | geological, technical, drilling and processing problems; | |
| ● | military operations, terrorist acts, wars or embargoes; | |
| ● | the cost and availability of adequate insurance coverage; | |
| ● | our vulnerability to severe weather events; and | |
| ● | other risk factors discussed in the “Risk Factors” section of this Quarterly Report and in our Form 10-K. |
| 18 |
We have based these forward-looking statements largely on our current expectations and projections about our business, the industry in which we operate and financial trends that we believe may affect our business, financial condition, results of operations and prospects, and these forward-looking statements are not guarantees of future performance or development. These forward-looking statements speak only as of the date of this Quarterly Report and are subject to a number of risks, uncertainties and assumptions described in the section titled “Risk Factors” and elsewhere in this Quarterly Report. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on these forward-looking statements as predictions of future events. The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained herein until after we distribute this Quarterly Report, whether as a result of any new information, future events or otherwise.
In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain, and you are cautioned not to unduly rely upon these statements.
Overview
We are a California-based oil and gas exploration and development company with operations in Monterey County, California, Uintah County, Utah, and the Lloydminster region of Saskatchewan, Canada. Our strategy continues to focus on acquiring and developing assets that provide near-term production, long-term development potential, and opportunities for value creation through targeted operational investment.
We began generating revenues in fiscal 2024 following the restart of production at the McCool Ranch Oil Field and expanded our revenue base in fiscal 2025 through the acquisition of producing heavy-oil assets in Saskatchewan. During the three months ended January 31, 2026, our operational activity continued to center on our Canadian properties, which represent our most significant near-term growth opportunity. We are progressing workover and optimization programs on the assets acquired from Novacor in April 2025 and December 2025, as well as the assets acquired from Capital Land in November 2025.
In California, we continue to advance permitting efforts for the South Salinas Project, including conditional use permits and water-disposal permits. We are also evaluating potential joint-venture arrangements to support development activities and continue to assess the feasibility of a carbon capture and storage initiative leveraging existing deep wells and infrastructure. At the P.R. Spring project in Utah, we continue to monitor production performance at the Asphalt Ridge wells to determine whether conditions under the existing non-binding Letter of Intent (LOI) with Heavy Sweet Oil LLC (“HSO”) may be satisfied.
In January 2026, we entered into an at-the-market offering agreement with Ladenburg Thalmann & Co. Inc., permitting the sale of up to $3,600,000 of common stock from time to time at our discretion, providing additional flexibility to access capital to support our development plans. We expect our Canadian operations to remain the primary driver of near-term production and revenue growth, while we continue to advance permitting, strategic evaluation, and potential carbon capture and storage (“CCS”) initiatives at South Salinas.
Recent Developments
Ladenburg ATM Agreement
On January 9, 2026, we entered into an At Market Issuance Sales Agreement (the “ATM Agreement”) with Ladenburg Thalmann & Co. Inc. (“Ladenburg”) as agent, pursuant to which we may issue and sell shares of our common stock from time to time through Ladenburg (the “ATM Offering”). On January 9, 2026, we also filed a prospectus supplement with the SEC covering the sale of shares of common stock having an aggregate offering price of up to $3,600,000 (the “Placement Shares”), in connection with the ATM Offering. Upon delivery of a Placement Notice (as such term is defined in the ATM Agreement) and subject to the terms and conditions of the ATM Agreement, Ladenburg shall use its commercially reasonable efforts to sell the Placement Shares by (i) any method permitted by law deemed to be an “at the market offering” as defined in Rule 415(a)(4) promulgated under the Securities Act of 1933, as amended (the “Securities Act”), including sales made directly on or through the NYSE American or on any other existing trading market for the common stock and/or (ii) any other method permitted by law with our consent. The ATM Agreement provides that Ladenburg will be entitled to aggregate compensation for its services up to 3.0% of the gross proceeds from each sale of Placement Shares sold through Ladenburg under the ATM Agreement.
Subsequent to the period ended January 31, 2026, we filed amendments to the prospectus supplement related to the ATM Offering on March 3, 2026, March 4, 2026, March 5, 2026, and March 10, 2026 to increase the dollar amount of Placement Shares that may be offered pursuant to the ATM Offering by $3,292,000, $6,458,000, $4,000,000, and $1,641,000, respectively. We have sold an additional 18,729,291 shares of common stock for aggregate gross proceeds of $18,622,934 subsequent to the period ended January 31, 2026 and as of the date of this filing. Management believes the consequential subsequent cash raised provides a tremendous opportunity to accelerate the expansion of the Company's oil and gas assets both in Canada and the U.S. as the focus will seek to acquire assets generating more significant cash flow with high impact growth potential.
Capital Land Services Acquisition
On August 20, 2025, we, through our wholly owned subsidiary Trio Canada, entered into an Asset Purchase Agreement (“APA”) with Capital Land Services Ltd. (“Capital Land”). Pursuant to the APA, Trio Canada agreed to acquire certain mineral leasehold interests and related rights located in the County of Vermilion of River, Alberta, Canada, together with associated contracts, permits, and registrations (collectively, the “Assets”). The total purchase price consists of CAD $150,000 in cash and the issuance of restricted shares of our common stock having an aggregate value of CAD $150,000.
On November 3, 2025, the transactions contemplated under the APA were completed (the “Capital Land Acquisition”). At closing, Trio Canada paid Capital Land CAD $150,000 in cash and we issued 104,227 restricted shares of our common stock to Capital Land. In exchange, Trio Canada acquired the Assets, including certain wells that had been purchased out of receivership. Due to regulatory requirements of the Alberta Energy Regulator (“AER”), We arranged for all applicable licenses to be transferred to Novacor, an experienced operator with whom we have an existing commercial relationship. Novacor utilizes Capital Land as its AER agent. In consideration for Capital Land’s services as AER agent, we granted Capital Land a 1% gross overriding royalty with respect to the mineral rights, for as long as Capital Land continues to provide such services.
Asset Purchase Transaction with Novacor Exploration Ltd.
As of December 30, 2025, we entered into an Asset Purchase Agreement (the “December 2025 Novacor APA”) with Trio Canada, and Novacor, pursuant to which, subject to the terms and conditions set forth in the December 2025 Novacor APA, Trio Canada agreed to acquire certain assets of Novacor’s relating to Novacor’s oil and gas business, including certain contracts, leases and permits for working interests in petroleum and natural gas and mineral rights located in the Lloydminster, Saskatchewan heavy oil region in Canada (collectively, the “December 2025 Novacor Assets”), free and clear of any liens other than certain specified liabilities of Novacor that are being assumed (collectively, the “Liabilities” and such acquisition of the Assets and assumption of the Liabilities together, the “December 2025 Novacor Acquisition”) for a total purchase price of CAD $1,000,000 (US$730,300 based on the applicable exchange rate to U.S. Dollars). We issued to Seller 912,875 restricted shares of our common stock, subject to certain registration rights (the “Purchase Price”).
| 19 |
The December 2025 Novacor Acquisition was closed on December 30, 2025, simultaneously with the execution by us, Trio Canada and Novacor of the December 2025 Novacor APA and other transaction documents (the “Closing”). At the Closing, title to the December 2025 Novacor Assets was delivered to Trio Canada, and us, thereafter deliver the restricted shares to Novacor.
Following the Closing, (i) operating costs for the December 2025 Novacor Assets shall, for a period of two (2) years, be held at the levels detailed in the auditor’s report over the eighteen (18) month period prior to the Closing, prepared for Trio Canada on the basis of the due diligence materials provided by Novacor to Trio Canada in connection with the December 2025 Novacor Acquisition, unless mutually agreed otherwise; (ii) after such two-year period, operating costs shall remain competitive with other operators in the area; and (iii) Trio Canada shall be entitled to terminate Novacor’s post-Closing actions at any time on 30 days’ prior written notice to the Novacor. After the Closing, with respect to the December 2025 Novacor Assets, Novacor shall act as the on-site operator of the December 2025 Novacor Assets and perform all work and services as provided in the December 2025 Novacor APA.
On December 30, 2025, we and Novacor executed and entered into a Registration Rights Agreement with respect to the restricted shares (the “RRA”). Pursuant to the provisions of the RRA, Novacor is entitled to certain “piggyback” registration rights, with respect to the Registrable Securities (as such term is defined in the RRA), providing Novacor with the right to include the Registrable Securities in a registration statement filed by us for the registration of our securities and/or the resale of shares of Common Stock by other of our stockholders (a “Piggyback Registration Statement”), subject to certain limitations and restrictions. In the event that the Registrable Securities are not included in a Piggyback Registration Statement filed by us with the Securities and Exchange Commission (“SEC”) on or before March 31, 2026, we are obligated to file a registration statement on or before March 31, 2026, to register the resale of the Registrable Securities, subject to certain limitations and restrictions. We have agreed to pay all fees relating to the registration of the Registrable Securities, except any broker or similar commissions payable by a holder of Registrable Securities.
Going Concern Considerations
We continue to incur operating losses and have not yet generated sufficient revenues to support our operations. As of January 31, 2026, we had an accumulated deficit of $28,368,441 and a working capital deficit of $901,484. For the three months ended January 31, 2026, we incurred a net loss of $1,012,629 and used $533,893 in cash for operating activities. Based solely on our financial position as of January 31, 2026, these factors raised substantial doubt about our ability to continue as a going concern for the twelve months following the issuance of these condensed consolidated financial statements.
Since inception, we have funded our operations primarily through equity and debt financings, including proceeds from common stock issuances, our April 2023 initial public offering, multiple convertible note financings, promissory notes, and sales under our at-the-market (“ATM”) offering programs. During the quarter ended January 31, 2026, we raised approximately $395,000 under our ATM program. Subsequent to January 31, 2026 and through the date of issuance of these financial statements, we raised additional gross proceeds of $18.6 million under the ATM program, for total gross proceeds of approximately $19.0 million raised under the ATM program as of the date of this filing.
These subsequent ATM proceeds significantly improved our liquidity position and are expected to be sufficient to fund our operating and capital requirements for at least twelve months from the date of issuance of these financial statements. Management evaluated whether these capital raises, together with the Company’s operating plans, alleviate the conditions that initially raised substantial doubt about the Company’s ability to continue as a going concern. Based on the additional capital raised after January 31, 2026 and prior to issuance of these financial statements, management concluded that its plans are probable of being effectively implemented and sufficient to address the Company’s liquidity needs for the twelve month period following issuance. Accordingly, while substantial doubt existed as of January 31, 2026, management’s plans have alleviated that substantial doubt.
Our condensed consolidated financial statements continue to be prepared on a going-concern basis and do not include any adjustments to the carrying amounts or classification of assets and liabilities that may result from future developments. Additional information regarding our going-concern assessment is provided in Note 3 to the condensed consolidated financial statements.
| 20 |
Factors and Trends Affecting Our Business and Results of Operations
Our results continue to be influenced by global economic conditions and volatility in commodity prices. Fluctuations in oil prices, geopolitical developments, and changes in regulatory environments can affect our cash flows and operating margins. We continue to focus on cost management and operational efficiency, particularly at our Canadian properties, where lift costs remain relatively low compared to our California assets.
Our near-term strategy remains centered on expanding production and development activities across our recently acquired Canadian assets, which we believe offer the most immediate potential for revenue growth. We are pursuing workover and optimization programs on the assets acquired from Novacor and Capital Land and evaluating additional opportunities to enhance production.
In connection with our most recent acquisition, we expect to begin recognizing revenue April 1 of next quarter in accordance with applicable accounting standards. The asset is already producing and is expected to approximately double our current production levels, providing near term cash flow and further supporting our strategy of scaling through disciplined, accretive acquisitions.
At the South Salinas Project, we continue to advance permitting efforts with Monterey County, CalGEM, and the California Water Boards. We are also evaluating potential joint-venture arrangements to support development activities and continue to assess the feasibility of a carbon capture and storage initiative leveraging existing deep wells and infrastructure. While the HV-3A well remains capable of production testing under existing permits, operations are currently idled as we evaluate potential steps to increase production rates and assess joint-venture opportunities.
At the P.R. Spring project, we continue to monitor production performance at the Asphalt Ridge wells. If sustained production targets are achieved, we may elect to proceed with a definitive agreement under the existing letter of intent; however, we are under no obligation to do so.
The additional capital raised through our ATM program represents a transformational step for the Company, enabling us to accelerate the pursuit of larger, higher impact oil and gas acquisitions over the coming quarters. With this strengthened balance sheet, we are now positioned to target projects in both Canada and the United States in the range of 350 to 1,000 barrels per day, significantly expanding our production profile and long term growth potential.
Our ability to execute our development plans and grow our business will depend in part on continued access to capital markets and our ability to secure financing on acceptable terms.
Emerging Growth Company Status
We are an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies. These exemptions include reduced disclosure obligations regarding executive compensation, the omission of auditor attestation requirements under Section 404(b) of the Sarbanes-Oxley Act, and extended transition periods for adopting new or revised accounting standards. We have elected to use the extended transition period for complying with new or revised accounting standards applicable to public companies.
Results of Operations
Three Months Ended January 31, 2026 compared to the Three Months Ended January 31, 2025 (unaudited)
Our financial results for the three months ended January 31, 2026 and 2025 are summarized as follows:
For the Three Months Ended January 31, | ||||||||||||||||
| 2026 | 2025 | Change | % Change | |||||||||||||
| Revenues | $ | 122,193 | $ | 10,819 | $ | 111,374 | 1,029.4 | % | ||||||||
| Cost of goods sold | 68,402 | - | 68,402 | 100.0 | % | |||||||||||
| Gross profit | 53,791 | 10,819 | 42,972 | 397.2 | % | |||||||||||
| Operating expenses: | ||||||||||||||||
| Exploration expense | $ | 19,690 | $ | 24,721 | $ | (5,031 | ) | (20.4 | )% | |||||||
| General and administrative expense | 751,824 | 711,546 | 40,278 | 5.7 | % | |||||||||||
| Stock-based compensation expense | 84,872 | 490,314 | (405,442 | ) | (82.7 | )% | ||||||||||
| Accretion expense | 1,797 | 695 | 1,102 | 158.6 | % | |||||||||||
| Total operating expenses | 858,183 | 1,227,276 | (369,093 | ) | (30.1 | )% | ||||||||||
| Loss from Operations | (804,392 | ) | (1,216,457 | ) | 412,065 | (33.9 | )% | |||||||||
| Other expenses, net: | ||||||||||||||||
| Interest expense | 136,734 | 318,366 | (181,632 | ) | (57.1 | )% | ||||||||||
| Loss on note conversion | 71,503 | 80,702 | (9,199 | ) | (11.4 | )% | ||||||||||
| Total other expenses, net | 208,237 | 399,068 | (190,831 | ) | (47.8 | )% | ||||||||||
| Loss before income taxes | (1,012,629 | ) | (1,615,525 | ) | 602,896 | (37.3 | )% | |||||||||
| Income tax benefit | - | - | - | - | ||||||||||||
| Net loss | $ | (1,012,629 | ) | $ | (1,615,525 | ) | $ | 602,896 | (37.3 | )% | ||||||
| 21 |
Revenues, net
Revenues, net increased for the three months ended January 31, 2026 by approximately $111,374 as compared to the prior period. Revenues from the prior period were from the sale of approximately 180 barrels of oil produced from the HH-1 and the 35X wells located in the McCool Ranch oil field, and current revenues are from the sale of approximately 3,020 barrels of oil from our recently acquired assets in the Lloydminster, Saskatchewan region.
Exploration expenses
Under the successful efforts method of accounting for crude oil and natural gas properties, exploration expenses consist primarily of exploratory, geological and geophysical costs, delay rentals, and exploratory overhead, and are expensed as incurred. Exploration expenses decreased by a nominal amount as compared to the prior year period due to reduced exploratory costs incurred during the period.
General and administrative expenses
General and administrative expenses consist primarily of personnel expenses, including salaries, benefits and stock-based compensation expense for employees and consultants in executive, finance and accounting, legal, operations support, information technology and human resource functions. General and administrative expenses also include corporate facility costs including rent, utilities, depreciation, amortization and maintenance, as well as legal fees related to intellectual property and corporate matters and fees for accounting and consulting services.
General and administrative expenses increased by $40,278 for the three months ended January 31, 2026. This change represents an increase of less than 6%, and was primarily attributable to normal period-to-period fluctuations in professional fees and personnel-related costs.
Stock-based compensation expense
We record stock-based compensation expenses for costs associated with options and restricted shares granted in connection with the Plan, as well as for shares issued as payment for services. Stock-based compensation expense decreased by approximately $0.4 million for the three months ended January 31, 2026 due to the amortization of approximately 62,500 more options in the prior three month period than in the current period.
Accretion expense
Accretion expense increased by $1,102 for the three months ended January 31, 2026 compared to the same period in the prior year. The increase is primarily due to the ARO liability recognized in December 2025 in connection with the acquisition of the Novacor oil and gas assets in Saskatchewan. AROs are recorded at fair value when incurred and subsequently accreted over the expected life of the related asset. As a result, the newly recorded Novacor ARO contributed incremental accretion expense during the current quarter.
Other expenses, net
For the three months ended January 31, 2026, other expenses, net decreased compared to the prior year period. The decrease was primarily attributable to a reduction in non-cash interest expense of approximately $0.2 million, driven by lower outstanding debt levels during the current period. Non-cash interest expense reflects the amortization of debt discounts associated with prior financings.
Liquidity and Capital Resources
Working Capital (Deficiency)
A comparison of our working capital deficiency is presented below:
| January 31, 2026 | October 31, 2025 | |||||||
| Current assets | $ | 902,542 | $ | 1,070,988 | ||||
| Current liabilities | 1,804,026 | 1,856,890 | ||||||
| Working capital (deficiency) | $ | (901,484 | ) | $ | (785,902 | ) | ||
Current assets decreased primarily due to a $0.2 million reduction in cash, reflecting the use of proceeds from the convertible note issued in the prior quarter. Current liabilities decreased overall, driven by a reduction of approximately $0.3 million in convertible notes, partially offset by a $0.2 million increase in accounts payable.
Subsequent to January 31, 2026, our liquidity position improved significantly as a result of additional capital raised through our ATM Offering. The gross proceeds received of approximately $18.6 million after quarter-end increased our cash balances and reduced our working capital deficiency, providing additional short-term liquidity to support ongoing operating activities and near-term obligations.
Cash Flows
Our cash flows for the three months ended January 31, 2026, in comparison to our cash flows for the three months ended January 31, 2025, can be summarized as follows:
| Three months ended January 31, | ||||||||
| 2026 | 2025 | |||||||
| Net cash used in operating activities | $ | (533,893 | ) | $ | (920,485 | ) | ||
| Net cash used in investing activities | 5,472 | (160,779 | ) | |||||
| Net cash provided by financing activities | 382,519 | 2,756,520 | ||||||
| Effect of foreign currency exchange | (51,607 | ) | - | |||||
| Net change in cash | $ | (197,509 | ) | $ | 1,675,256 | |||
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Cash Flows from Operating Activities
Net cash used in operating activities was $533,893 for the three months ended January 31, 2026, compared to $920,485 for the three months ended January 31, 2025. The improvement in operating cash flows primarily reflects a smaller net loss in the current period and changes in non-cash items and working capital. Non-cash adjustments partially offset the impact of our net loss and included $135,700 of amortization of debt discounts, $84,872 of stock-based compensation, $40,950 of common shares issued for services, $71,503 related to the issuance of common shares in lieu of cash for debt payments and $1,797 of accretion expense. These non-cash items reduced the cash impact of our operating loss.
Working-capital changes also influenced operating cash flows. Accounts receivable decreased by $12,463, and accounts payable and accrued liabilities increased by $214,409, both of which provided cash. These favorable movements were partially offset by a $39,562 increase in prepaid expenses and other receivables and a $43,397 decrease in other liabilities, both of which used cash. Overall, the combination of a lower net loss, higher non-cash adjustments, and favorable changes in certain working-capital accounts resulted in lower cash used in operating activities compared to the prior-year period.
Cash Flows from Investing Activities
Net cash provided by investing activities was $5,472 for the three months ended January 31, 2026, compared to net cash used of $160,779 for the three months ended January 31, 2025. The change primarily reflects the timing of capital expenditures and operator settlements. During the current period, we paid $55,100 for oil and gas property additions, which was more than offset by a $60,572 decrease in amounts due to operators. In the prior-year period, investing cash outflows were driven by approximately $78,165 of capitalized oil and gas property costs and an $82,614 increase in amounts due to operators.
Cash Flows from Financing Activities
Net cash provided by financing activities was $382,519 for the three months ended January 31, 2026, compared to $2,756,520 for the three months ended January 31, 2025. The current-period financing inflows reflect proceeds from sales of common stock under our at-the-market offering program. In the prior-year period, financing activities included $3.5 million of ATM proceeds, partially offset by $524,796 of promissory note repayments and $194,332 of repayments of related-party notes payable.
Capital Resources
Since our inception, we have funded our operations primarily through equity and debt financings. We have historically experienced liquidity constraints due to our limited ability to raise capital on acceptable terms and have relied on the issuance of equity and convertible promissory notes to support our operations. During the quarter ended January 31, 2026, we raised approximately $395,000 under our ATM program. Subsequent to January 31, 2026 and through the date of this filing, we raised additional gross proceeds of $18.6 million under the ATM program, resulting in total gross proceeds of approximately $19.0 million raised under the ATM program as of the date of this report.
These subsequent ATM proceeds significantly strengthened our capital resources by increasing our cash position and reducing our working capital deficit. Based on the additional capital raised after January 31, 2026 and management’s current operating plans, we believe our existing cash resources are sufficient to meet our working capital and capital expenditure needs for at least twelve months from the date of this report.
Future capital requirements will depend on a number of factors, including the timing of planned operational activities, the development and operation of wells, and potential acquisitions of additional properties. To the extent that existing capital and expected operating cash flows are not sufficient to fund future activities, we may seek additional financing through equity or debt offerings. There can be no assurance that such financing will be available on favorable terms or at all. Failure to obtain additional financing, if needed, could have a material adverse effect on our financial position, results of operations, and cash flows. See “Going Concern Considerations” above for additional information regarding our liquidity assessment.
Contractual Obligations and Commitments
Unproved Property Leases
South Salinas Project
We hold various leases related to unproved properties in the South Salinas Project. Two leases with the same lessor remain active:
| ● | Lease 1 (8,417 acres): The lease remains valid through continued operations and production at the HV-3A well. | |
| ● | Lease 2 (160 acres): Held by delay rental. The annual rental payment of $30 per acre for the period October 2025 through October 2026 was paid in advance, and we remain in compliance. |
All additional South Salinas leases entered into during 2023 were abandoned during fiscal 2025 following an evaluation of economic and operational factors. No further obligations remain under the abandoned leases.
Proved Property Leases – Saskatchewan, Canada
In April 2025, the Company acquired oil and gas lease rights for four proved properties located in Saskatchewan, Canada. The leases total 320 net acres and are held by production. As of January 31, 2026, the Company remained in compliance with all lease terms. The Company made an additional lease payment of $4,100 during the three months ended January 31, 2026.
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Board of Directors Compensation
Under a compensation plan approved on July 11, 2022, non-employee directors are entitled to an annual cash retainer of $50,000, plus an additional $10,000 per Board committee served. Payments are made quarterly in arrears. For the three months ended January 31, 2026 and 2025, we recognized director compensation expense of $75,840 and $59,167, respectively.
Agreements with Advisors
We previously entered into placement agent agreements with Spartan Capital Securities, LLC (“Spartan”) in connection with its IPO and subsequent private placements. Under these agreements, Spartan received cash fees and warrants to purchase common stock. All warrants issued to Spartan remain outstanding as of January 31, 2026. No new placement agent agreements were entered into, and no additional fees or warrants were incurred or issued during the three months ended January 31, 2026.
Critical Accounting Policies and Estimates
The preparation of our condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses, and related disclosures. We base our estimates and assumptions on historical experience, current conditions, and other factors that management believes to be reasonable under the circumstances. Actual results could differ materially from those estimates. Our critical accounting policies and estimates are those that require significant judgment and are most important to the portrayal of our financial condition and results of operations.
The critical accounting policies and estimates disclosed in our Annual Report on Form 10-K for the year ended October 31, 2025 continue to be our critical accounting policies for the three months ended January 31, 2026. There have been no material changes to these policies during the current interim period, except as noted below where updates relate to recent acquisitions or current-period activity. Additional information regarding these policies is included in “Note 2 – Summary of Significant Accounting Policies” to our condensed consolidated financial statements.
Oil and Gas Assets and Exploration Costs – Successful Efforts
We continue to apply the successful efforts method of accounting for crude oil and natural gas properties. Exploration costs, including geological and geophysical costs, delay rentals, and exploratory overhead, are expensed as incurred. Costs associated with exploratory wells that indicate the potential for proved reserves are capitalized pending further evaluation. Management reviews the status of all suspended exploratory well costs each quarter to determine whether sufficient progress is being made toward assessing the existence of proved reserves.
During the three months ended January 31, 2026, we continued to evaluate the wells acquired in the April 2025 and December 2025 Novacor acquisitions and the November 2025 Capital Land acquisition. These wells remain in early production and evaluation stages, and we expect to update reserve estimates once additional production history is available. No material changes were made to our capitalization or evaluation policies during the current period.
Proved and Unproved Oil and Natural Gas Properties
Unproved oil and natural gas properties continue to be assessed for impairment on a property-by-property basis based on remaining lease terms, drilling results, and future development plans. As of January 31, 2026, our unproved properties remain in exploration or early evaluation stages, and no material impairments were recorded during the period.
Proved properties are subject to depreciation, depletion, and amortization (“DD&A”) using the unit-of-production method based on proved reserves. As of January 31, 2026, we continue to evaluate the reserve potential of our recently acquired Saskatchewan properties. Reserve values will be incorporated into our DD&A calculations once sufficient production history and engineering data are available. There were no material changes to our DD&A methodology during the quarter.
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Impairment of Long-Lived Assets
We review long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. This includes proved oil and gas properties, support equipment, and other long-lived assets. The impairment assessment compares the carrying value of the asset group to estimated future undiscounted cash flows. If the carrying value exceeds those cash flows, the asset is written down to fair value.
During the three months ended January 31, 2026, we monitored commodity prices, production trends, and operating results for indicators of impairment. No triggering events were identified that required an impairment charge during the period. Our impairment methodology remains unchanged from that disclosed in our Form 10-K.
Asset Retirement Obligations
Our asset retirement obligations (“ARO”) represent the estimated future costs to plug and abandon wells and restore sites. ARO is initially recorded at fair value when incurred or acquired, with a corresponding increase to the carrying amount of the related asset. The liability is accreted each period, and the capitalized cost is depreciated over the useful life of the asset.
During the three months ended January 31, 2026, the Company recorded an initial ARO liability of approximately $124,201 (USD) in connection with the December 2025 acquisition of oil and gas assets from Novacor Exploration Ltd. The ARO was measured based on well-specific abandonment and reclamation cost estimates included in the independent Petrotech reserve and economics report, which was prepared in accordance with COGE Handbook standards and served as an input in the valuation basis for the acquired petroleum assets.
Management is continuing to evaluate certain assumptions related to the timing and method of abandonment activities for the Canadian wells. Any refinements to these assumptions will be reflected in future periods as changes in estimate under ASC 410. No revisions to the initial ARO estimate were recorded during the quarter, and accretion expense recognized during the period was immaterial.
Fair Value Measurements
We apply the fair value hierarchy under ASC 820 to measure certain assets and liabilities. Our financial instruments, including cash, payables, and short-term obligations, approximate fair value due to their short maturities.
During the three months ended January 31, 2026, the only fair value measurement performed related to the valuation of publicly traded common stock issued as consideration in connection with the December 2025 Novacor acquisition. Because the fair value of this equity consideration is based on quoted market prices for our common stock, this measurement is classified as a Level 1 fair value measurement.
We did not perform any Level 2 or Level 3 fair value measurements during the period, and no assets or liabilities were measured at fair value on a recurring basis.
Recent Accounting Pronouncements
There have been no new accounting pronouncements issued during the three months ended January 31, 2026 that are expected to have a material impact on our condensed consolidated financial statements.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Not Applicable. As a smaller reporting company, we are not required to provide the information required by this Item.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our management, with the participation and supervision of our Chief Executive Officer and our Chief Financial Officer, have evaluated our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on that evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that, as of the end of the period covered by this Quarterly Report on Form 10-Q, our disclosure controls and procedures were effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting that occurred during our first fiscal quarter ended January 31, 2026 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II. OTHER INFORMATION
Item 1. Legal Proceedings
We are not currently subject to any legal proceedings.
Item 1A. Risk Factors
There have been no other material changes to the risk factors set forth in the section titled “Risk Factors” included in our Annual Report on Form 10-K for the year ended October 31, 2025, which was filed with the SEC on January 20, 2026 (“2025 Annual Report”). Our business involves significant risks. You should carefully consider the risks and uncertainties described in our 2025 Annual Report, together with all of the other information in our 2025 Annual Report and in this Quarterly Report on Form 10-Q, as well as our audited financial statements and related notes as disclosed in our 2025 Annual Report.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None, except as reported on Current Reports on Form 8-K filed by the Company during the quarterly period covered by this report.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
During the quarterly period ended January 31, 2026, none of our directors
or officers (as defined in Rule 16a-1(f) promulgated under the Exchange Act)
Item 6. Exhibits
| Exhibit No. | Description | |
| 31.1* | Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 31.2* | Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 32.1** | Certification of the Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
| 101.INS* | Inline XBRL Instance Document. | |
| 101.SCH* | Inline XBRL Taxonomy Extension Schema Document | |
| 101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
| 101.LAB* | Inline XBRL Taxonomy Extension Label Linkbase Document | |
| 101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
| 101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase Document | |
| 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) |
| * | Filed herewith. |
| ** | Furnished, not filed |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| TRIO PETROLEUM CORP | ||
| By: | /s/ Robin Ross | |
| Robin Ross | ||
| Chief Executive Officer (Principal Executive Officer) | ||
| Date: March 17, 2026 | ||
| By: | /s/ Greg Overholtzer | |
| Greg Overholtzer | ||
| Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) | ||
| Date: March 17, 2026 |
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FAQ
How did Trio Petroleum Corp (TPET) perform in its quarter ended January 31, 2026?
What is driving Trio Petroleum’s revenue growth in the latest TPET 10-Q?
How much cash did Trio Petroleum (TPET) raise through its at-the-market program?
What is Trio Petroleum’s liquidity and going-concern status after the Q1 2026 10-Q?
How have Trio Petroleum’s share count and dilution changed according to the TPET filing?
What is the status of Trio Petroleum’s August 2025 convertible notes?
What are the key Canadian acquisitions highlighted in Trio Petroleum’s 10-Q?
