[10-Q] Tradewinds Universal Quarterly Earnings Report
Rhea-AI Filing Summary
Tradewinds Universal (TRWD) filed its Q3 2025 10‑Q, reporting higher quarterly sales but a larger loss and a going‑concern warning. Q3 sales were $65,450 versus $28,068 a year ago, driven by distribution rights. Q3 net loss widened to $108,199 from $36,547 as consulting and professional fees rose.
For the nine months, sales were $98,422 versus $146,179 last year, reflecting the shift away from UP protein bar product sales and affiliate commissions. Nine‑month net loss was $134,454 compared to $102,249. Cash was $7,161 at September 30, 2025. Total assets increased to $316,556, mainly from $222,700 of intangible assets (including a $200,000 AI application acquired for 173,913 shares). Stockholders’ equity was $312,056.
The company disclosed substantial doubt about its ability to continue as a going concern and noted disclosure controls were not effective as of September 30, 2025. Shares outstanding were 36,610,580 as of November 14, 2025. Management highlighted an August 2025 LOI with Peppermint Hippo to enter nightlife and hospitality, starting with the planned acquisition of Peppermint Hippo Toledo.
Positive
- None.
Negative
- Going concern: Management disclosed substantial doubt about continuing as a going concern.
- Controls: Disclosure controls and procedures were not effective as of September 30, 2025.
Insights
Higher Q3 sales, but liquidity strain and going‑concern risk dominate.
Tradewinds Universal shifted revenue mix to distribution rights, lifting Q3 sales to
Liquidity is tight with cash of
The August LOI with Peppermint Hippo signals a new segment, but execution depends on future funding and closing steps. Subsequent filings may provide specifics on any acquisition completion and financing structure.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For the quarterly period ended
For the transition period from ________________to ________________
(Name of small business issuer in its charter)
|
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
TradewindsUniversal.com
(Address and telephone number of registrant's principal executive offices and principal place of business)
Check
whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or
for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.
Indicate
by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T (ss.232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was
required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.
|
Large accelerated filer |
☐ | Accelerated filer | ☐ |
|
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☒ | Smaller reporting company | |
| Emerging growth company | |
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) Yes ☐
No
Securities registered pursuant to Section 12(b) of the Act: None
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.
| Class | November 14, 2025 |
| Common Stock, $0.001 par value per share |
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This document contains certain statements of a forward-looking nature. Such forward-looking statements, including but not limited to statements regarding projected growth, trends and strategies, future operating and financial results, financial expectations, and current business indicators, are based upon current information and expectations and are subject to change based on factors beyond the control of the Company. Forward-looking statements typically are identified by the use of terms such as “look,” “may,” “should,” “might,” “believe,” “plan,” “expect,” “anticipate,” “estimate,” and similar words, although some forward-looking statements are expressed differently. The accuracy of such statements may be impacted by a number of risks and uncertainties that could cause actual results to differ materially from those projected or anticipated, including but not limited to those set forth herein and in our Annual Report on Form 10-Q.
Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Except as federal securities laws require, we undertake no obligation to update forward-looking information. Nonetheless, the Company reserves the right to make such updates from time to time by press release, periodic report or other method of public disclosure without the need for specific reference to this Report. No such update shall be deemed to indicate that other statements not addressed by such update remain correct or create an obligation to provide any other updates.
TABLE OF CONTENTS
INDEX
| Part I. | Financial Information | |
| Item 1. | Financial Statements | 1 |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 11 |
| Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 13 |
| Item 4. | Controls and Procedures | 13 |
| Part II. | Other Information | |
| Item 1. | Legal Proceedings | 14 |
| Item 1A. | Risk Factors | 14 |
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 14 |
| Item 3. | Defaults upon Senior Securities | 14 |
| Item 4. | Mining Safety Disclosures | 14 |
| Item 5. | Other Information | 14 |
| Item 6. | Exhibits | 15 |
| Signatures | 16 |
Financial Statements
Tradewinds Universal
Table of Contents
September 30, 2025
| Financial Statements (unaudited) | 1 |
| Balance Sheets as of September 30, 2025 (unaudited) and December 31, 2024 | 2 |
| Statements of Operations for the three months and nine months ended September 30, 2025 and 2024 (unaudited ) | 3 |
| Statements of Changes in Stockholders’ Equity for the three and nine months ended September 30, 2025 and 2024 (unaudited) | 4 |
| Statements of Cash Flow for the nine months ended September 30, 2025 and 2024 (unaudited) | 5 |
| Notes to the Financial Statements (unaudited) | 6 |
| 1 |
TRADEWINDS UNIVERSAL
BALANCE SHEETS
| September 30, 2025 (Unaudited) | December 31, 2024 | |||||||
| ASSETS | ||||||||
| Current Assets | ||||||||
| Cash and Cash Equivalents | $ | $ | ||||||
| Prepaid Expense | ||||||||
| Accounts Receivable | ||||||||
| Total Current Assets | ||||||||
| Intangible Assets Net | ||||||||
| Total Assets | $ | $ | ||||||
| Liabilities and Stockholders' Equity | ||||||||
| Accounts Payable | $ | $ | ||||||
| Total Current Liabilities | ||||||||
| Total Liabilities | ||||||||
| Commitments and Contingencies (Note 3) | — | — | ||||||
| Stockholders' Equity | ||||||||
| Common stock, $ | ||||||||
| Additional Paid in Capital | ||||||||
| Accumulated Deficit | ( | ) | ( | ) | ||||
| Total Stockholders' Equity | ||||||||
| Total Liabilities and Stockholders' Equity | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited financial statements
| 2 |
TRADEWINDS UNIVERSAL
STATEMENTS OF OPERATIONS
(Unaudited)
| For the Three Months ended September 30, 2025 | For the Three Months ended September 30, 2024 | For the Nine Months ended September 30, 2025 | For the Nine Months ended September 30, 2024 | |||||||||||||
| Revenue | ||||||||||||||||
| Commission Income | $ | $ | $ | $ | ||||||||||||
| Distribution Rights | ||||||||||||||||
| Product Sales | ||||||||||||||||
| Total Sales | ||||||||||||||||
| Cost of Sales | ||||||||||||||||
| Gross Profit | ||||||||||||||||
| Operating Expenses | ||||||||||||||||
| Amortization | ||||||||||||||||
| Professional Fees | ||||||||||||||||
| Consulting | ||||||||||||||||
| Marketing | ||||||||||||||||
| General and Administrative | ||||||||||||||||
| Total Operating Expenses | ||||||||||||||||
| Net Loss Before Taxes | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Provision for Income Tax | ||||||||||||||||
| Net Loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Net Loss Per share - Basic and Diluted | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Basic and diluted weighted average shares used in the calculation of net income per common share | ||||||||||||||||
The accompanying notes are an integral part of these unaudited financial statements.
| 3 |
TRADEWINDS UNIVERSAL
STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024
(Unaudited)
| Common Stock | Common Stock Amount | Additional Paid-in Capital | Accumulated Deficit | Total Stockholders’ Equity | ||||||||||||||||
| Balance at December 31, 2023 | $ | $ | $ | ( | ) | $ | ||||||||||||||
| Net Loss | — | — | — | ( | ) | ( | ) | |||||||||||||
| Balance March 31, 2024 | $ | $ | $ | ( | ) | $ | ||||||||||||||
| Net Loss | — | — | — | ( | ) | ( | ) | |||||||||||||
| Balance June 30, 2024 | $ | $ | $ | ( | ) | $ | ||||||||||||||
| Net Loss | — | — | — | ( | ) | ( | ) | |||||||||||||
| Balance September 30, 2024 | $ | $ | $ | ( | ) | $ | ||||||||||||||
| Common Stock | Common Stock Amount | Additional Paid-in Capital | Accumulated Deficit | Total Stockholders’ Equity | ||||||||||||||||
| Balance at December 31, 2024 | $ | $ | $ | ( | ) | $ | ||||||||||||||
| Net Loss | — | — | — | ( | ) | ( | ) | |||||||||||||
| Balance March 31, 2025 | $ | $ | $ | ( | ) | $ | ||||||||||||||
| Shares Issued | — | |||||||||||||||||||
| Net Loss | — | — | — | ( | ) | ( | ) | |||||||||||||
| Balance June 30, 2025 | $ | $ | $ | ( | ) | $ | ||||||||||||||
| Shares Issued | ||||||||||||||||||||
| Net Loss | ( | ) | ( | ) | ||||||||||||||||
| Balance September 30, 2025 | $ | $ | $ | ( | ) | $ | ||||||||||||||
The accompanying notes are an integral part of these unaudited financial statements
| 4 |
TRADEWINDS UNIVERSAL
STATEMENTS OF CASH FLOW
(Unaudited)
| For the Nine Months ended September 30, 2025 | For the Nine Months ended September 30, 2024 | |||||||
| Operating Activities | ||||||||
| Net Loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to Reconcile Net Loss to Net Cash from Operating Activities | ||||||||
| Deferred Taxes | ||||||||
| Amortization | ||||||||
| Stock Compensation | ||||||||
| Changes in Operating Assets and Liabilities | ||||||||
| Inventory | ||||||||
| Prepaid Expense | ( | ) | ||||||
| Accounts Payable | ||||||||
| Accounts Receivable | ( | ) | ||||||
| Net Cash from Operating Activities | ( | ) | ( | ) | ||||
| Investing Activities | ||||||||
| Net Cash from Investing Activities | ||||||||
| Financing Activities | ||||||||
| Stock Issued for Cash | ||||||||
| Net Cash from Financing Activities | ||||||||
| Net Change in Cash and Cash Equivalents | ( | ) | ||||||
| Cash and Cash Equivalents at Beginning of Period | ||||||||
| Cash and Cash Equivalents at End of Period | $ | $ | ||||||
| Supplemental Cash Flow Information | ||||||||
| Cash Paid for Interest | $ | $ | ||||||
| Cash Paid for Taxes | — | |||||||
| Supplemental Non-Cash Investing and Financing Activities | ||||||||
| Prepaid Expense (non-cash future payment) | $ | $ | ||||||
| Purchase of Intangible Asset (shares issued, non-cash transaction) | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited financial statements
| 5 |
TRADEWINDS UNIVERSAL
NOTES TO THE UNAUDITED FINANCIAL STATEMENTS
September 30, 2025
Note 1 – Nature of Operations
Nature of Operations
Tradewinds Universal, Inc. (“Tradewinds” or the “Company”) was incorporated in Wyoming on December 21, 2021, as a holding company focused on acquiring and developing businesses with long-term value, resilience, and growth potential. Initially, the Company developed and distributed high-nutrition foods and beverages, including edible insect protein-based products, and in 2022, acquired a canine pain relief formula for development into pet treats.
In August 2025, the Company signed a Letter
of Intent with Peppermint Hippo™, a company that generates an estimated $
Note 2 - Summary of Significant Accounting Policies
Basis of Presentation
The accompanying financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC") and reflect all adjustments, consisting of normal recurring adjustments, which management believes are necessary to fairly present the financial position, results of operations and cash flows of the Company.
Estimates
The preparation of the financial statement in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts. Accordingly, actual results could differ from those estimates.
Cash And Cash Equivalents
The Company maintains a cash balance in a non-interest-bearing
account that currently does not exceed federally insured limits. For the purpose of the statements of cash flows, all highly liquid investments
with an original maturity of three months or less are considered to be cash equivalents. There were
Inventory
Inventory is recorded at the lower of cost or market; cost is computed on a first-in, first-out basis.
Intangible Asset
As
of September 30, 2025, the Company had intangible assets totaling $
Stock Compensation
The company accounts for stock-based compensation
in accordance with ASC 718, Compensation—Stock Compensation. Stock compensation expense is recognized over the vesting or
service period based on the fair value of the award at the grant date. Fair value is determined using an appropriate valuation model,
such as the Black-Scholes-Merton or Monte Carlo method, incorporating assumptions about expected term, stock volatility, risk-free interest
rate, and dividend yield. The company recognizes expense net of estimated forfeitures, which are updated periodically or accounted for
as they occur. If award terms are modified, any incremental fair value is recognized over the remaining service period. For tax purposes,
deferred tax assets are recorded for deductible temporary differences, and excess tax benefits or deficiencies are reflected in income
tax expense when realized. The company also provides the required disclosures about its stock-based compensation plans, valuation methods,
and the financial statement effects of such awards. For the nine months ending September 30, 2025 the Company issued
| 6 |
Going Concern
The Company's financial statements are prepared
using GAAP applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course
of business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs to allow it to
continue as a going concern, and therefore, there is substantial doubt about the Company’s ability to continue as a going concern.
As of September 30, 2025, and December 31, 2024, the Company had an accumulated deficit of $
The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts for amounts and classification of liabilities that might result from this uncertainty.
Impairment Of Long-Lived Assets
The Company reviews its long-lived assets
for impairment in accordance with Accounting Standards Codification ("ASC") 360-10, Impairment or Disposal of Long-Lived
Assets. The Company evaluates long-lived assets, such as depreciable intangible assets for impairment whenever events or changes in
circumstances indicate that the carrying value of an asset may not be recoverable. Indefinite lived intangible assets are tested for impairment
at least annually. If indicators of impairment exist and the undiscounted future cash flows that the assets are expected to generate are
less than the carrying value of the assets, the Company reduces the carrying amount of the assets to their estimated fair values based
on a discounted cash flow approach or, when available and appropriate, to comparable market values. There were
Revenue Recognition
The Company recognizes revenue in accordance with ASC 606. Revenue is recognized when a customer obtains control of promised goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods or services. The Company applies the following five-step model in order to determine this amount:
| • | Identification of the promised goods in the contract; | |
| • | Determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; | |
| • | Measurement of the transaction price, including the constraint of variable consideration; | |
| • | Allocation of the transaction price of the performance obligations; | |
| • | Recognition of revenue when (or as) the Company satisfies each performance obligation. |
The performance obligation associated with a typical product sale will be satisfied upon delivery to customers, and the revenue will be recognized at that time. Payments are due on demand. The Company does not offer any warranty on its products; however, customers do receive a manufacturer’s warranty.
The Company's main revenue stream to date has been from the sale of distribution territories for its protein bars. The Company sells rights to distribute its protein bars and other products to outside parties and determines if the distribution agreement (“DA”) is a distinct (separate) performance obligation in accordance with ASC 606. If the DA is determined not to be distinct, the license is combined with the other goods or services and the combined performance obligation is accounted for using the general revenue recognition model outlined above. If the DA is determined to be distinct, the Company analyzes whether the DA is functional or symbolic to assess the timing of revenue recognition. The DA by the Company was determined to be a distinct performance obligation of symbolic intellectual property (“IP)”, which provides a right to access IP. ASC 606 states that revenue from licenses of IP deemed to provide a right to use IP will be recognized at a point in time when control is transferred.
In accordance with Topic 606, the Company analyzes the following to determine when to recognize DA revenue:
| i. | Whether the transaction represents a sale or licensing of IP |
| ii. | Whether the IP is a distinct performance obligation, |
| iii. | The nature of the license - functional or symbolic; and |
| iv. | The timing of recognition based on the nature of the license. |
| 7 |
The Company only applies the five-step model to contracts when it is probable the entity will collect the consideration it is entitled to in exchange for the goods and represents services it transfers to the customer. Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligations when the performance obligation is satisfied or as it is satisfied. The Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligations when the performance obligation is satisfied or as it is satisfied. Generally, the Company's performance obligations are transferred to customers at a point in time, typically upon delivery.
Fair Value of Financial Instruments
ASC 825, Financial Instruments requires disclosure of the fair value of certain financial instruments. The carrying value of cash and cash equivalents, accounts payable, and accrued liabilities, when reflected in the balance sheets, approximate fair value because of the short-term maturity of these instruments. All other significant financial assets, financial liabilities, and equity instruments of the Company are either recognized or disclosed in the financial statements, together with other information relevant to making a reasonable assessment of future cash flows, interest rate risk, and credit risk. Where practicable, the fair values of financial assets and financial liabilities have been determined and disclosed; otherwise, only available information pertinent to fair value has been disclosed. The Company follows ASC 820, Fair Value Measurements and ASC 825, which permits entities to choose to measure many financial instruments and certain other items at fair value.
Income Taxes
In accordance with ASC 740 Income Taxes, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in Income in the period that includes the enactment date.
The Company has adopted the provisions set
forth in ASC 740 to account for uncertainty in income taxes. In the preparation of income tax returns in federal and state jurisdictions,
the Company asserts certain tax positions based on its understanding and interpretation of the income tax law. The taxing authorities
may challenge such positions, and the resolution of such matters could result in recognition of Income tax expense in the Company's financial
statements. Management believes it has used reasonable judgments and conclusions in the preparation of its income tax returns. The Company
uses the "more likely than not" criterion for recognizing the tax benefit of uncertain tax positions and to establish measurement
criteria for income tax benefits. The Company' s policy is to recognize interest and/or penalties related to income tax matters in income
tax expense. The Company had
Earnings Per Share of Common Stock
The Company computes income (loss) per share
in accordance with ASC 260 Earning Per Share, which requires presentation of basic and diluted EPS on the face of the income statement
for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation
to the numerator and denominator of the diluted EPS computation. In the accompanying financial statements, basic earnings (loss) per share
of common stock is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during
the period. The Company does not have a complex capital structure requiring the computation of diluted earnings per share. However there
are
Recently Issued Accounting Pronouncements
There have been no recent accounting pronouncements or changes in accounting pronouncements during the nine months ended September 30, 2025 that are of significance or potential significance to the Company.
Note 3 - Commitments and Contingencies
During the normal course of business, the Company may be exposed to litigation. When the Company becomes aware of potential litigation, it evaluates the merits of the case in accordance with ASC 450, Contingencies. The Company evaluates its exposure to the matter, possible legal or settlement strategies and the likelihood of an unfavorable outcome. If the Company determines that an unfavorable outcome is probable and can be reasonably estimated, it establishes the necessary accruals. As of September 30, 2025, and December 31, 2024, the Company is not aware of any contingent liabilities that should be reflected in the unaudited financial statements.
| 8 |
Note 4 - Segment Disclosure
ASC 280 “Segment Reporting ”, establishes standards for reporting information about operating segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the CODM in deciding how to allocate resources and in assessing performance. The Company manages its business on the basis of one reportable segment and unit and derives revenues mainly from products, licensing rights and affiliate commissions (see Note 1 for a brief description of the Company’s business).
The Company operates as one operating segment. Operating segments are defined as components of an enterprise for which separate financial information is regularly evaluated by the CODM, which is the Company’s chief executive officer, who reviews financial information and annual operating plans for purposes of making operating decisions, evaluating financial performance, and allocating resources.
The key measure of segment profit or loss that the CODM uses to allocate resources and assess performance is the Company’s net income (loss). This is reviewed against budgeted expectations to assess segment performance and allocate resources. The Company’s segment net loss for September 30, 2025, and 2024 consisted of the following:
Segment Disclosures for the Quarters Ended:
| Schedule of segment disclosures | ||||||||
| September 30, 2025 | September 30, 2024 | |||||||
| Sales | ||||||||
| Distribution Income | $ | $ | ||||||
| Product Sales | ||||||||
| Affiliate Commissions | ||||||||
| Net Sales | ||||||||
| Gross Profit | ||||||||
| Sales, marketing and support | ||||||||
| Marketing costs | ||||||||
| Professional fees | ||||||||
| Amortization | ||||||||
| Consulting | ||||||||
| General and Administrative costs | ||||||||
| Net Income (Loss) Before Taxes | $ | ( | ) | $ | ( | ) | ||
Note 5 – Stock Issuances
During the nine months ended September 30, 2025, the Company issued
a total of
| · | ||
| · | ||
| · | ||
| · | ||
| · | On August 20, 2025, |
| 9 |
Note 6 - Income Taxes
The Company recognizes deferred income tax liabilities and assets for the expected future tax consequences of events that have been recognized in the financial statements or tax returns. Under this method, deferred tax liabilities and assets are determined based on the differences between the financial statement carrying amounts and the tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse.
The components of the Company's reconciliation of
income taxes computed at the statutory rate of
| Schedule of reconciliation of income taxes | ||||||||
September 30, 2025 | September 30, 2024 | |||||||
| Net Loss Before Taxes | $ | ( | ) | $ | ( | ) | ||
| Effective Tax Rate | % | % | ||||||
| Provision For Income Taxes | $ | ( | ) | $ | ( | ) | ||
| Schedule of net deferred tax asset | ||||||||
September 30, 2025 | September 30, 2024 | |||||||
| Deferred tax asset | $ | $ | ||||||
| Less valuation allowance | ( | ) | ( | ) | ||||
| Net deferred tax asset | $ | $ | ||||||
As of September 30, 2025, the components of the deferred tax asset related to net loss. Due to uncertainties surrounding the Company’s ability to generate future U.S. taxable income to realize these assets, a full valuation allowance has been established to offset the net U.S. deferred tax asset as of September 30, 2025.
Note 7 - Subsequent Events
In accordance with ASC 855, Subsequent Events, the Company has analyzed its operations subsequent to September 30, 2025 to the date the unaudited financial statements were issued and has determined that it does not have any material subsequent events to disclose.
| 10 |
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our financial statements and the related notes to those statements included elsewhere in this prospectus. In addition to historical financial information, the following discussion and analysis contains forward-looking statements that involve risks, uncertainties, and assumptions. Our actual results and timing of selected events may differ materially from those anticipated in these forward-looking statements as a result of many factors, including, but not limited to, those discussed under the section titled “Risk Factors” and elsewhere in this prospectus. See the section titled “Special Note Regarding Forward-Looking Statements” elsewhere in this prospectus.
Overview
Tradewinds Universal, Inc. (“Tradewinds” or the “Company”) is a holding company focused on acquiring and developing businesses with long-term value, resilience, and growth potential. Our initial operations focused on the development and distribution of high-nutrition foods and beverages, including edible insect protein-based bars marketed under the Universal Proteins (UP) brand. In 2022, we also acquired a canine pain relief formula for development into pet treats.
In August 2025, we signed a Letter of Intent with Peppermint Hippo™ to create a dedicated nightlife and hospitality division. The LOI includes the acquisition of Peppermint Hippo Toledo as the initial property, followed by a phased rollout of several clubs nationwide, including 8 Peppermint Hippo locations and other affiliated brands owned or operated by Peppermint Hippo. This move represents a major strategic expansion into a new industry sector.
We successfully completed the development, manufacturing, and initial distribution of two protein bar SKUs (Chocolate Almond and Peanut Butter Fruit) in 2023 through our partnership with YouBar, Inc. In 2024, we entered into a purchase agreement with a distributor for 1,040 cases of UP bars, all of which were sold by September 30, 2024. We continue to market our bars online and to retail outlets, but larger-scale distribution agreements remain uncertain. Development of additional SKUs is ongoing.
Looking ahead, we intend to keep expanding our UP product line, move forward with commercializing our canine pain relief formula, and explore licensing and distribution opportunities. We expect operating expenses to rise as we develop new product lines, enter nightlife and hospitality markets, and continue as a public company. Net losses are likely to vary depending on the timing of marketing efforts, R&D activities, and potential acquisitions. Currently, we are working on securing funding through additional equity or debt financing to support our growth plans.
Results of Operations
Comparison of the Three Months and Nine Months Ended September 30, 2025 and 2024
Revenue
For the nine months ended September 30, 2025 and 2024
For the nine months ended September 30, 2025, the Company generated total sales of $98,422, compared to $146,179 for the nine months ended September 30, 2024. The decrease of $47,757, was primarily due to a reduction in affiliate commission income and the discontinuation of product sales of the Company’s UP protein bars. During the 2025 period, revenues were primarily derived from distribution rights, while in the prior year period, a majority of revenues came from affiliate marketing and product sales activities.
| 11 |
For the three months ended September 30, 2025 and 2024
For the three months ended September 30, 2025, the Company reported total sales of $65,450, compared to $28,068 for the three months ended September 30, 2024. The increase of $37,382, was primarily attributable to income from the sale of distribution rights recorded during the current quarter. By contrast, revenues in the prior year’s quarter were primarily generated from affiliate commissions and sales of the Company’s UP protein bars, both of which have since declined or ceased as the Company shifted its focus toward distribution and licensing activities.
Cost of Goods Sold
For the nine months ended September 30, 2025 and 2024
For the nine months ended September 30, 2025, the Company recorded no cost of sales, compared to $21,645 for the nine months ended September 30, 2024. The decrease was primarily due to the absence of product sales during the 2025 period, as the Company discontinued sales of its UP protein bars and generated revenue primarily from distribution rights, which did not incur any associated production or delivery costs.
For the three months ended September 30, 2025 and 2024
For the three months ended September 30, 2025, the Company similarly recorded no cost of sales, compared to $9,132 for the three months ended September 30, 2024. The decrease reflects the transition away from physical product sales toward revenue derived from distribution rights, which have no direct cost component.
Gross Profit
For the nine months ended September 30, 2025 and 2024
For the nine months ended September 30, 2025, the Company reported a gross profit of $98,422, compared to $124,534 for the nine months ended September 30, 2024. The decrease of $26,112, was primarily due to lower overall revenues resulting from the discontinuation of UP protein bar sales and reduced affiliate commission income. The Company’s 2025 revenues were mainly derived from the sale of distribution rights, which carried no associated cost of sales, thereby maintaining a 100% gross margin despite the decline in total revenue.
For the three months ended September 30, 2025 and 2024
For the three months ended September 30, 2025, the Company generated a gross profit of $65,450, compared to $18,936 for the three months ended September 30, 2024. The increase of $46,514, was primarily attributable to revenue recognized from the sale of distribution rights during the quarter, which incurred no cost of sales. By contrast, the prior year’s gross profit was derived from affiliate commissions and product sales that carried direct production costs, resulting in a lower gross margin.
Operating Expenses
For the nine months ended September 30, 2025 and 2024
For the nine months ended September 30, 2025, the Company recorded total operating expenses of $232,876, compared to $180,413 for the nine months ended September 30, 2024, representing an increase of $46,263. The increase was primarily attributable to higher consulting expenses, which rose to $151,905 from $3,050 in the prior year, reflecting expanded business development and strategic advisory activities associated with the Company’s new distribution rights. This increase was partially offset by lower marketing expenses, which decreased to $29,920 from $129,657 in the prior year period, as the Company reduced promotional spending following the discontinuation of its UP protein bar product line. Professional fees declined modestly to $36,016 from $43,493, and general and administrative expenses increased to $6,435 from $4,213. The Company also recorded amortization expense of $8,600 related to the website intangible asset during the current period and the acquisition of an intangible asset.
For the three months ended September 30, 2025 and 2024
For the three months ended September 30, 2025, the Company incurred total operating expenses of $173,649, compared to $55,483 for the three months ended September 30, 2024, an increase of $111,966. The increase was primarily due to higher consulting expenses of $112,055 in the current quarter compared to $1,050 in the same period last year. Additionally, professional fees increased slightly to $26,016 from $22,168, while marketing costs decreased to $29,068 from $31,918. General and administrative expenses remained relatively consistent at $310 for the current quarter compared to $347 for the same quarter of 2024. The Company also recorded amortization expense of $6,200 related to the website intangible asset during the current period, and the acquisition of an intangible asset
Net Loss
For the nine months ended September 30, 2025 and 2024
For the nine months ended September 30, 2025, the Company reported a net loss of $134,454, compared to a net loss of $102,249 for the nine months ended September 30, 2024. The increase in net loss of $26,005, was primarily attributable to higher operating expenses, particularly consulting costs associated with the Company’s strategic expansion into distribution and licensing activities. Although the Company maintained strong gross margins due to the nature of its revenue mix in 2025, the increase in professional and consulting expenses offset these gains, resulting in an overall higher net loss.
For the three months ended September 30, 2025 and 2024
For the three months ended September 30, 2025, the Company recorded a net loss of $108,199, compared to a net loss of $36,547 for the three months ended September 30, 2024. The increase of $65,452, was primarily driven by elevated consulting and professional fees during the quarter, reflecting the Company’s continued investment in business development and new distribution initiatives. Despite higher revenues from distribution rights, these increased expenditures contributed to a larger quarterly loss compared to the prior year period.
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Liquidity and Capital Resources
As of September 30, 2025, the Company had total assets of $316,556, compared to $31,510 at December 31, 2024, representing a substantial increase primarily attributable to the recognition of intangible assets and accounts receivable related to the Company’s distribution activities. Current assets totaled $93,856 at September 30, 2025, consisting primarily of cash and cash equivalents of $7,161, accounts receivable of $48,750, and prepaid expenses of $37,945, compared to $210 in current assets at December 31, 2024. The significant increase in current assets reflects improved working capital and prepayments associated with operational expansion.
The Company’s total liabilities were $4,500 as of September 30, 2025, compared to no liabilities at December 31, 2024. The modest increase relates to normal operating accounts payable. Stockholders’ equity increased to $312,056 at September 30, 2025, from $31,510 at year-end 2024, primarily due to additional paid-in capital from equity issuances and the recognition of intangible assets acquired through the issuance of common stock.
As of September 30, 2025, the Company had limited cash resources of $7,161 and an accumulated deficit of $424,644, reflecting continued operating losses. The Company’s current cash position is not sufficient to sustain long-term operations without additional financing. Management plans to address these liquidity needs through future equity issuances, revenue growth from distribution rights, and potential strategic partnerships. The Company will continue to evaluate its operating structure and pursue additional capital as necessary to support its ongoing business activities.
Investing Activities
For the quarters ending September 30, 2025 and 2024, we no cash investing activities. We had $200,000 in non-cash investing activities related to the acquisition of an AI app.
Financing Activities
Our financing activities mainly consist of proceeds from the sale of our common stock. During the quarter ending September 30, 2025, we had $40,000 in financing activity, compared to $0 during the quarter ending September 30, 2024.
The Company believes it has insufficient cash resources to fund its primary operations. The Company currently has no off-balance sheet arrangements and does not expect to enter into any that could reasonably affect its financial condition now or in the future. The Company has no agreements with shareholders, officers, directors, or third parties to fund operations beyond the end of its fourth quarter. It has neither negotiated nor has access to any other third-party sources of liquidity.
Off Balance Sheet Items
We do not have any off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons, also known as “special purpose entities” (SPEs).
Significant Accounting Policies and Estimates
Management's Discussion and Analysis of Financial Condition and Results of Operations discusses the Company's financial statements which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management bases its estimates and judgments on historical experiences and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
As a “smaller reporting company” as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
An evaluation was performed under the supervision of our management, including our Chief Executive Officer (principal executive officer) and Chief Financial Officer (principal financial and accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of the end of the period covered by our Annual Report. Based on that evaluation, our management, including our Chief Executive Officer and Chief Financial Officer, concluded that, as of September 30,2025, our disclosure controls and procedures were not effective to ensure 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 the SEC's rules and forms due to material weaknesses in our internal controls as described in the December 31, 2024 annual report.
Changes in Internal Control Over Financial Reporting.
We have made no change in our internal control over financial reporting during the last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings
The Company was not subject to any legal proceedings during the three-month and nine-month periods ended September 30, 2025 or year ended December 31, 2024 and to the best of our knowledge and belief no proceedings are currently threatened or pending.
Item 1A. Risk Factors
As a "smaller reporting company" as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 3. Defaults upon Senior Securities
None.
Item 4. Mining Safety Disclosures
Not applicable to our Company.
Item 5. Other Information
Item 6. Exhibits
| Number | Exhibit |
| 31.1** | Certification of the Chief Executive Officer, as the principal executive officer and the principal financial officer, under 18 U.S.C. Section 1350, as adopted in accordance with section 302 of the Sarbanes-Oxley Act of 2002. |
| 32.1** | Certification of the Chief Executive Officer, as the principal executive officer and the principal financial officer, under 18 U.S.C. Section 1350, as adopted in accordance with Section 906 of the Sarbanes-Oxley Act of 2002. |
| 101** | Interactive Data files |
** Filed Herewith
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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
| Dated: November 14, 2025 | TRADEWINDS UNIVERSAL | |
| By: | /s/ Andrew Read | |
| Andrew Read, | ||
| Chief Executive Officer | ||
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FAQ
What were TRWD’s Q3 2025 sales and net loss?
How did year-to-date results compare for TRWD?
What is TRWD’s cash position and equity as of Sept. 30, 2025?
Did TRWD issue new shares or warrants in 2025?
What risks did TRWD highlight regarding its operations?
What strategic move did TRWD announce in August 2025?
How many shares of TRWD were outstanding?
