Tradewinds Universal (TRWD) Q1 2026 results highlight loss and going concern risk
Tradewinds Universal reported results for the quarter ended March 31, 2026 with revenue of $21,800, up from $12,972 a year earlier, driven mainly by higher licensing and distribution activity.
Operating expenses rose sharply to $147,141, leading to a net loss of $125,341 versus a $1,112 loss in the prior-year quarter. Cash used in operating activities was $76,041, and cash on hand was $15,597 at period end.
The company raised $50,000 from issuing 1,000,000 shares and obtained a $25,000 loan, ending with total assets of $283,992 and stockholders’ equity of $231,992. Management disclosed that recurring losses and limited cash resources raise substantial doubt about Tradewinds Universal’s ability to continue as a going concern.
Positive
- None.
Negative
- None.
Insights
Revenue grew, but losses, cash burn, and a going concern warning dominate.
Tradewinds Universal increased quarterly revenue to $21,800 from $12,972, reflecting expansion in licensing and distribution. However, operating expenses jumped to $147,141, largely from higher marketing, professional fees, and consulting tied to growth initiatives and public-company obligations.
This cost ramp produced a net loss of $125,341 and operating cash outflow of $76,041, leaving only $15,597 in cash as of March 31, 2026. To bridge the gap, the company relied on a $25,000 loan and $50,000 equity issuance, while also issuing 1,000,000 new warrants at low exercise prices.
Management explicitly states that recurring losses and limited liquidity raise substantial doubt about the company’s ability to continue as a going concern. Future filings will show whether additional financing, execution of licensing strategies, or the contemplated Peppermint Hippo nightlife initiative meaningfully improve revenue and reduce reliance on external capital.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
For the quarter ended
For the transition period from __________ to __________
Commission file number:
(Exact name of registrant as specified in its charter)
———————
| 2000 | ||
(State or other jurisdiction of incorporation or organization) |
(Primary Standard Industrial Classification Code Number) |
(I.R.S. Employer Identification Code Number) |
TradewindsUniversal.com
Andrewreadtw@gmail.com
(Address and telephone number of registrant's principal executive offices and principal place of business)
Buffalo Registered Agents LLC
401 N Main Street
Buffalo, WY 82834
855-434-4488
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Yes ☐ No ☒
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities
Exchange Act of 1934 during the preceding 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 (§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 if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Yes ☐ No ☒
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”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act:
| Large accelerated Filer | ☐ | Accelerated Filer | ☐ |
| ☒ | Smaller reporting company | ||
| (Do not check if a 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 7(a)(2)(B) of the Securities Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☐ No
Number of shares of registrant's common stock,
par value $.001, outstanding as of May 14, 2026:
TABLE OF CONTENTS
| PAGE | ||
| Part I | ||
| ITEM 1 | Financial Statements | 4 |
| ITEM 2 | Management's Discussion and Analysis of Financial Condition and Results of Operations | 15 |
| ITEM 3 | Quantitative and Qualitative Disclosures about Market Risk | 17 |
| ITEM 4 | Controls and Procedures | 17 |
| Part II | ||
| ITEM 1 | Legal Proceedings | 17 |
| ITEM 1A | Risk Factors | 17 |
| ITEM 2 | Unregistered Sales of Equity Securities and Use of Proceeds | 18 |
| ITEM 3 | Defaults Upon Senior Securities | 18 |
| ITEM 4 | Mine Safety Disclosures | 19 |
| ITEM 5 | Other Information | 19 |
| ITEM 6 | Exhibits | 19 |
| Signatures | 19 |
| 2 |
Financial Statements
Tradewinds Universal
Table of Contents
March 31, 2026
| Financial Statements | 4 |
| Balance Sheets as of March 31, 2026 (unaudited) and December 31, 2025 (audited) | 4 |
| Statements of Operations for the three months ended March 31, 2026 and 2025 (unaudited) | 5 |
| Statements of Stockholders' Equity for the three months ended March 31, 2026, and 2025 (unaudited) | 6 |
| Statements of Cash Flows for the three months ended March 31, 2026 and 2025 (unaudited) | 7 |
| Notes to the Financial Statements March 31, 2026 (Unaudited) | 8 |
| 3 |
TRADEWINDS UNIVERSAL
BALANCE SHEETS AS OF MARCH 31, 2026 AND DECEMBER 31, 2025
March
31, (Unaudited) | December
31, 2025 | |||||||
| ASSETS | ||||||||
| Current Assets | ||||||||
| Cash and Cash Equivalents | $ | $ | ||||||
| Prepaid Expense | ||||||||
| Accounts Receivable | ||||||||
| Total Current Assets | ||||||||
| Other Assets-Intangible Assets | ||||||||
| Intangible Asset - AI App -net of Amortization | ||||||||
| Formula-Pets-net | ||||||||
| Trademarks | ||||||||
| Total Other Assets (net) | $ | $ | ||||||
| Total Assets | ||||||||
| Liabilities and Stockholders' Equity | ||||||||
| Accounts Payable | $ | $ | ||||||
| Loan 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
| 4 |
TRADEWINDS UNIVERSAL
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2026 AND MARCH 31, 2025
March
31, (unaudited) | March31, (unaudited) | |||||||
| Revenue | $ | $ | ||||||
| Gross Profit | ||||||||
| Operating Expenses | ||||||||
| Marketing | ||||||||
| Advertising | ||||||||
| Professional Fees | ||||||||
| Consulting | ||||||||
| Amortization | ||||||||
| General and Administrative | ||||||||
| Loss on Impairment | ||||||||
| 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 loss per common share | ||||||||
The accompanying notes are an integral part of these unaudited financial statements.
| 5 |
TRADEWINDS UNIVERSAL
STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 2026 (Unaudited) AND MARCH 31, 2025 (Unaudited)
| Common Shares | Common Shares Amount | Additional Paid-in Capital | Accumulated Deficit | Total Stockholders’ Equity | ||||||||||||||||
| Balance December 31, 2024 | $ | $ | $ | ( | ) | $ | ||||||||||||||
| Net Loss | — | — | — | ( | ) | ( | ) | |||||||||||||
| Balance March 31, 2025 | $ | $ | $ | ( | ) | $ | ||||||||||||||
| Common Shares | Common Shares Amount | Additional Paid-in Capital | Accumulated Deficit | Total Stockholders’ Equity | ||||||||||||||||
| Balance December 31, 2025 | $ | $ | $ | ( | ) | |||||||||||||||
| Shares Issued for Cash | — | |||||||||||||||||||
| Net Loss | — | — | — | ( | ) | ( | ) | |||||||||||||
| Balance March 31, 2026 | $ | $ | $ | ( | ) | $ | ||||||||||||||
The accompanying notes are an integral part of these unaudited financial statements
| 6 |
TRADEWINDS UNIVERSAL
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2026 AND MARCH 31, 2025
March 31, 2026 (unaudited) | March 31, 2025 (unaudited) | |||||||
| Operating Activities | ||||||||
| Net Loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to Reconcile Net Loss to Net Cash from Operating Activities | ||||||||
| Amortization | ||||||||
| Changes in Operating Assets and Liabilities | ||||||||
| Prepaid Expense | ||||||||
| Accounts Payable | ||||||||
| Accounts Receivable | ( | ) | ||||||
| Net Cash Provided by Operating Activities | ( | ) | ||||||
| Investing Activities | ||||||||
| Net Cash Provided by Investing Activities | ||||||||
| Financing Activities | ||||||||
| Loan | ||||||||
| Common Stock | ||||||||
| 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 | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited financial statements
| 7 |
TRADEWINDS UNIVERSAL
NOTES TO THE FINANCIAL STATEMENTS
March 31, 2026 (Unaudited)
Note 1 – Nature of Operations
Nature of Operations
Tradewinds Universal, Inc. (the “Company”) was incorporated in the State of Wyoming on December 28, 2021. The Company operates as a holding company focused on acquiring, developing, and managing businesses with long-term value, resilience, and growth potential.
The Company’s initial operations focused on the development and distribution of high-nutrition foods and beverages, including edible insect protein-based products. In 2022, the Company acquired a canine pain relief formula for development into pet-related products. During the year ended December 31, 2025, the Company expanded its strategic focus to include distribution and licensing activities.
On August 19, 2025, we entered into a non-binding Letter of Intent, or LOI, with Scar Holdings LLC, also known as Peppermint Hippo™, regarding the potential formation of a division focused on the acquisition and development of nightlife and hospitality venues under the Peppermint Hippo brand.
The first proposed acquisition contemplated by the LOI is Peppermint Hippo Toledo, located in Toledo, Ohio. The LOI further contemplates that we may, together with Peppermint Hippo, evaluate the possible acquisition of additional Peppermint Hippo-branded venues over time.
The LOI is non-binding and no definitive acquisition agreement has been entered into with respect to Peppermint Hippo Toledo or any other venue. Completion of any acquisition would be subject to a number of conditions, including completion of due diligence, negotiation and execution of definitive agreements, receipt of required consents, financing, and regulatory and licensing approvals. As a result, there can be no assurance that we will complete the acquisition of Peppermint Hippo Toledo, pursue any additional acquisition opportunity with Peppermint Hippo, or otherwise establish a nightlife and hospitality division.
Note 2 - Summary of Significant Accounting Policies
Basis of Presentation
The accompanying unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”). In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of the Company’s financial position as of March 31, 2026 and December 31, 2025 and the results of operations and cash flows for the three months ended March 31, 2026 and 2025 have been included.
Estimates
The preparation of the financial statements 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 cash balances in non-interest-bearing
accounts that currently do not exceed federally insured limits. For purposes of the statements of cash flows, all highly liquid investments
with an original maturity of three months or less are considered cash equivalents. There were
| 8 |
Accounts Receivable
Accounts receivable consist of trade receivables
and are stated at the amount management expects to collect. As of March 31, 2026 and December 31, 2025, accounts receivable totaled $
The Company evaluates accounts receivable for
expected credit losses in accordance with ASC 326, Financial Instruments—Credit Losses. In estimating expected credit losses, management
considers relevant available information, including historical collection experience, the financial condition and creditworthiness of
the customer, current economic conditions, and reasonable and supportable forecasts of future conditions that may affect collectibility.
Based on this evaluation,
Prepaid Expenses
Prepaid expenses consist primarily of payments
made for services to be received in future periods and are expensed as the services are consumed. As of March 31, 2026 and December 31,
2025, prepaid expenses totaled $
Intangible Asset
Intangible assets are recorded at cost and amortized over their estimated useful lives unless determined to have an indefinite useful life.
For definite-lived intangible assets, the Company evaluates impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If such indicators are present, the Company compares the expected undiscounted future cash flows attributable to the asset to its carrying amount. If the carrying amount exceeds the expected undiscounted future cash flows, an impairment loss is recognized for the amount by which the carrying amount exceeds the asset’s fair value.
Indefinite-lived intangible assets are not amortized but are evaluated for impairment at least annually, or more frequently if events or changes in circumstances indicate that it is more likely than not that the asset is impaired.
As of March 31, 2026, the Company’s intangible assets consisted of the following:
| · | AI
App, net $ | |
| · | Formula-Pets
$ | |
| · | Trademarks
$ |
Total intangible assets, net, were $
As of March 31, 2025, the Company’s intangible
assets totaled $
Finite-lived intangible assets are amortized
on a straight-line basis over their estimated useful lives. The Company’s AI application is amortized over five years, and the
Company’s website was amortized over two years and was fully amortized as of December 31, 2025. Amortization expense was $
Stock Compensation
The Company accounts for stock-based compensation in accordance with ASC 718, Compensation—Stock Compensation. Stock-based compensation expense is recognized based on the fair value of equity instruments issued.
The Company is authorized to issue
During the three months ended March 31, 2026,
the Company issued
| 9 |
Impairment Of Long-Lived Assets
The Company accounts for impairment of intangible assets in accordance with ASC 350, Intangibles—Goodwill and Other. Definite-lived intangible assets are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Indefinite-lived intangible assets are not amortized but are tested for impairment at least annually, or more frequently if events or changes in circumstances indicate potential impairment.
As of March 31, 2026, the carrying value of the
Formula-Pets intangible asset was $
Revenue Recognition
The Company accounts for revenue in accordance with ASC 606, Revenue from Contracts with Customers. Under ASC 606, revenue is recognized when control of promised goods or services is transferred to customers in an amount that reflects the consideration the Company expects to receive in exchange for those goods or services.
The Company’s revenue for the three months ended March 31, 2026 and 2025 was derived primarily from distribution rights, licenses, and affiliate commissions.
For each contract, the Company first determines whether an arrangement exists that creates enforceable rights and obligations. The Company then identifies the distinct performance obligations promised in the contract. The transaction price is determined based on the consideration the Company expects to receive under the terms of the arrangement, including fixed amounts and, when applicable, estimates of variable consideration to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur. When a contract contains more than one performance obligation, the transaction price is allocated to each performance obligation based on its relative standalone selling price.
Revenue from distribution rights is recognized at the point in time or over the period in which the customer obtains control of the contractual rights, depending on the nature of the arrangement and the Company’s performance obligations under the contract.
Revenue from licenses is recognized when the licensed intellectual property is made available to the customer or over the license term, depending on whether the license provides a right to use intellectual property as it exists at a point in time or a right to access intellectual property as it evolves over time.
Revenue from affiliate commissions is recognized at the time the underlying qualifying transaction occurs and the commission is earned, which is the point at which the Company’s performance obligation is satisfied.
The Company evaluates each contract to determine
whether it acts as principal or agent, as applicable, and records revenue on a gross or net basis consistent with that determination.
Payment terms vary by contract but are generally due within 30 to 90 days. Amounts billed and collected in advance of satisfying the
related performance obligations are recorded as deferred revenue.
Fair Value of Financial Instruments
ASC 825, Financial Instruments, requires disclosure
of the fair value of certain financial instruments. The carrying amounts of cash and cash equivalents, accounts receivable, loan payable,
and accounts payable approximate fair value because of the short-term maturities of these instruments. The Company applies ASC 820, Fair
Value Measurement, which establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair
value into three levels: Level 1, quoted prices in active markets for identical assets or liabilities; Level 2, observable inputs other
than quoted prices included in Level 1; and Level 3, unobservable inputs reflecting the Company’s own assumptions. As of March
31, 2026 and December 31, 2025, the Company had
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.
| 10 |
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
The Company has incurred net operating losses
and has established a full valuation allowance against its deferred tax assets. As a result,
Earnings Per Share of Common Stock
Net loss per share is computed in accordance
with ASC 260, Earnings Per Share. Basic net loss per share is calculated by dividing net loss by the weighted average number of
common shares outstanding during the period. Diluted net loss per share gives effect to potentially dilutive securities, including warrants,
using the treasury stock method. During the quarter ended March 31, 2026, the Company issued
Recently Adopted Accounting Pronouncements
Management does not believe that any recently issued, but not yet effective, accounting pronouncements would have a material effect on the accompanying interim financial statements.
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. As of March 31, 2026 and December 31, 2025, the Company was not aware of any contingent liabilities or commitments that required accrual or disclosure in the accompanying unaudited financial statements.
Note 4 - Segment Disclosure
ASC 280, Segment Reporting, establishes standards for reporting information about operating segments. The Company manages its business on the basis of one reportable segment and derives revenues mainly from products, licensing rights, distribution rights, and affiliate commissions.
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 chief operating decision maker (“CODM”). The Company’s CODM is its chief executive officer, who reviews financial information and 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 loss.
Segment Disclosures for the Quarters Ended:
| Schedule of segment disclosures | ||||||||
| March 31, 2026 | March 31, 2025 | |||||||
| Sales | ||||||||
| Revenues | $ | $ | ||||||
| Net Sales | ||||||||
| Cost of Goods Sold | ||||||||
| Gross Profit | ||||||||
| Sales, marketing and support | ||||||||
| Marketing costs | ||||||||
| Professional fees | ||||||||
| Amortization | ||||||||
| Consulting | ||||||||
| General and Administrative costs | ||||||||
| Net Income (Loss) Before Taxes | $ | ( | ) | $ | ( | ) | ||
| 11 |
Note 5 – Stockholders' Equity
The Company is authorized to issue
Set forth below is information regarding the issuance and sales of securities without registration through March 31, 2026. No such sales involved the use of an underwriter, no advertising or public solicitation was involved, the securities bear a restrictive legend, and no commissions were paid in connection with the sale of any securities.
Since January 1, 2025 through March 31, 2026,
the Company issued an aggregate of
| · | On June 8, 2025, the Company
issued | |
| · | On June 9, 2025, the Company
issued | |
| · | On July 5, 2025, the Company
issued | |
| · | On July 8, 2025, the Company
issued | |
| · | On July 29, 2025, the Company
issued | |
| · | On August 20, 2025, the
Company issued | |
| · | On September 23, 2025,
the Company issued | |
| · | On October 10, 2025, the
Company issued | |
| · | On October 15, 2025, the
Company issued an aggregate of | |
| · | On November 1, 2025, the
Company issued | |
| · | On November 3, 2025, the
Company issued | |
| · | On November 12, 2025, the
Company issued | |
| · | On November 28, 2025, the
Company issued | |
| · | On January 23, 2026, the
Company issued | |
| · | On January 28, 2026, the
Company issued |
On February 5, 2022, the Company issued
The Company issued
As of March 31, 2026, the Company had
Warrants
During 2025, the Company issued warrants to purchase
an aggregate of
A summary of warrant activity for the three months ended March 31, 2026 is as follows:
| Schedule of warrant activity | ||||||||||
| Warrants | Weighted Average Exercise Price | |||||||||
| Outstanding at December 31, 2025 | $ | |||||||||
| Granted | $ | |||||||||
| Exercised | $ | |||||||||
| Expired | $ | |||||||||
| Outstanding at March 31, 2026 | $ | |||||||||
| Exercisable at March 31, 2026 | $ | |||||||||
| 12 |
As of March 31, 2026,
The following table summarizes warrants outstanding at March 31, 2026:
| Schedule of warrants outstanding | ||||||||||||||
| Grant Date | Shares Under Warrant | Exercise Price | Expiration Date | Exercise Terms | ||||||||||
| $ | ||||||||||||||
| $ | ||||||||||||||
| $ | ||||||||||||||
| $ | ||||||||||||||
| $ | ||||||||||||||
| $ | ||||||||||||||
| Total / Weighted Average | $ | |||||||||||||
Weighted Average term remaining:
For the current period issuances:
For the total warrants outstanding at March 31, 2026:
We have never utilized an underwriter for an offering of our securities. Other than the securities mentioned above and the common stock issuances described below, we have not issued or sold any other securities.
During the three months ended March 31, 2026,
the Company issued
Note 6 - Going Concern
The Company has incurred recurring losses and,
as of March 31, 2026 and December 31, 2025, had accumulated deficits of $
The Company’s ability to continue as a going concern is dependent upon its ability to obtain additional financing and achieve profitable operations. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Note 7 - Income Taxes
The Company recognizes deferred income tax assets and liabilities for the expected future tax consequences of events that have been recognized in the financial statements or tax returns. Deferred tax assets and liabilities are determined based on temporary differences between the financial statement carrying amounts and the tax bases 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 21% to the income tax amount recorded for the three months ended March 31, 2026 and 2025 are as follows:
| Schedule of reconciliation of income taxes | ||||||||||||||||
| March 31, 2026 | Rate | March 31, 2025 | Rate | |||||||||||||
| Net Loss Before Taxes | ( | ) | % | ( | ) | % | ||||||||||
| Tax benefit at federal statutory rate | ( | ) | ( | )% | ( | ) | ( | )% | ||||||||
| State income taxes, net of federal benefit | % | % | ||||||||||||||
| Change in valuation allowance | % | % | ||||||||||||||
| Provision from Income Taxes | % | % | ||||||||||||||
| 13 |
| Schedule of net deferred tax asset | ||||||||||||||||
| March 31, 2026 | Rate | March 31, 2025 | Rate | |||||||||||||
| Deferred Tax Asset | % | % | ||||||||||||||
| Less Valuation Allowance | ( | ) | ( | )% | ( | ) | ( | )% | ||||||||
| Net Deferred Tax Asset | % | % | ||||||||||||||
Because of uncertainties surrounding the Company’s
ability to generate future taxable income to realize deferred tax assets, a full valuation allowance has been established. Accordingly,
Note 8 - Subsequent Events
In accordance with ASC 855, Subsequent Events, the Company has evaluated subsequent events through the date these financial statements were issued. Management has determined that there were no material subsequent events requiring recognition or disclosure in the financial statements for the quarter ended March 31, 2026.
| 14 |
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 contain forward-looking statements involving risks, uncertainties, and assumptions. Our actual results and timing of selected events may differ materially from those anticipated in these forward-looking statements due to 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 (“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(TM) 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, explore licensing and distribution opportunities, and evaluate opportunities in the nightlife and hospitality markets. We expect operating expenses to remain elevated as we develop new product lines, pursue strategic opportunities, and continue as a public company. Net losses are likely to vary depending on the timing of marketing efforts, research and development activities, professional fees, and potential acquisitions. We are working on securing funding through additional equity or debt financing to support our growth plans.
Comparison of the Quarters Ended March 31, 2026 and March 31, 2025
Revenue
For the quarter ended March 31, 2026, the Company generated revenue of $21,800, compared to revenue of $12,972 for the quarter ended March 31, 2025. Revenue increased by $8,828, or approximately 68%, primarily due to increased licensing, distribution, and related business activity during the 2026 period.
Gross Profit
Gross profit for the quarter ended March 31, 2026 was $21,800, compared to gross profit of $12,972 for the quarter ended March 31, 2025. The Company did not report cost of goods sold for either period presented, and therefore gross profit equaled revenue in both periods.
Operating Expenses
Total operating expenses for the quarter ended March 31, 2026 were $147,141, compared to $14,084 for the quarter ended March 31, 2025, an increase of $133,057. Operating expenses for the 2026 period included marketing expense of $64,178, advertising expense of $411, professional fees of $23,796, consulting expense of $ 43,700, amortization expense of $10,000, and general and administrative expense of $5,056. Operating expenses for the 2025 period consisted primarily of consulting expense of $12,650, amortization expense of $1,200, and general and administrative expense of $234.
The increase in operating expenses was primarily attributable to higher marketing activity, professional fees, consulting expenses, amortization, and general and administrative costs incurred in connection with business development activities, strategic initiatives, and the Company’s public-company obligations.
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Net Loss
For the quarter ended March 31, 2026, the Company recorded a net loss of $125,341, compared to a net loss of $1,112 for the quarter ended March 31, 2025. The increase in net loss was primarily driven by the increase in operating expenses, partially offset by the increase in revenue and gross profit. Basic and diluted net loss per share was $0.01 for the quarter ended March 31, 2026, compared to $0.00 for the quarter ended March 31, 2025. Weighted average shares outstanding used in the calculation of basic and diluted net loss per share were 43,418,358 for the quarter ended March 31, 2026 and 32,170,000 for the quarter ended March 31, 2025.
Liquidity and Capital Resources
As of March 31, 2026, the Company had total assets of $283,992, compared to total assets of $307,333 as of December 31, 2025. Current assets at March 31, 2026 were $77,492, consisting of cash and cash equivalents of $15,597, prepaid expenses of $12,945, and accounts receivable of $48,950. Other assets, net, were $206,500 at March 31, 2026, consisting primarily of the AI app intangible asset, net of amortization, of $180,000, the Formula-Pets intangible asset of $25,000, and trademarks of $1,500.
As of March 31, 2026, the Company had total liabilities of $52,000, consisting of a loan payable of $25,000 and accounts payable of $27,000. The Company had no liabilities reported at December 31, 2025. Stockholders’ equity totaled $231,992 at March 31, 2026, compared to $307,333 at December 31, 2025. The decrease in stockholders’ equity during the quarter was primarily attributable to the net loss of $125,341, partially offset by the issuance of common stock for cash.
At March 31, 2026, the Company had 43,690,580 shares of common stock issued and outstanding, compared to 42,690,580 shares issued and outstanding at December 31, 2025. Additional paid-in capital was $1,496,709 at March 31, 2026, compared to $1,447,709 at December 31, 2025. The accumulated deficit increased to $1,308,408 at March 31, 2026 from $1,183,067 at December 31, 2025.
The Company continues to have limited cash resources. At March 31, 2026, cash and cash equivalents were $15,597. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The Company will require additional capital to fund ongoing operations and future growth initiatives. Management intends to pursue additional equity financing, debt financing, licensing revenue growth, and strategic partnerships; however, there can be no assurance that such financing or revenue will be available on acceptable terms, or at all.
Cash Flows
Operating Activities
Net cash used in operating activities was $76,041 for the quarter ended March 31, 2026, compared to net cash provided by operating activities of $88 for the quarter ended March 31, 2025. The cash used in operating activities during the 2026 period was primarily attributable to the net loss of $125,341, partially offset by non-cash amortization of $10,000, a decrease in prepaid expenses of $12,500, an increase in accounts payable of $27,000, and a $200 increase in accounts receivable.
Investing Activities
The Company had no cash provided by or used in investing activities for the quarters ended March 31, 2026 and March 31, 2025.
Financing Activities
Net cash provided by financing activities was $75,000 for the quarter ended March 31, 2026, consisting of $25,000 from a loan and $50,000 from the issuance of common stock. The Company had no cash provided by or used in financing activities for the quarter ended March 31, 2025.
As a result of the foregoing, cash and cash equivalents decreased by $1,041 during the quarter ended March 31, 2026, from $16,638 at December 31, 2025 to $15,597 at March 31, 2026. For the quarter ended March 31, 2025, cash and cash equivalents increased by $88, from $210 at December 31, 2024 to $298 at March 31, 2025.
Off Balance Sheet Items
The Company does not have any off-balance sheet arrangements, special purpose entities, or other relationships that would have a material effect on its financial condition or results of operations.
Significant Accounting Policies and Estimates
The Company’s financial statements are 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, liabilities, revenues, and expenses. Significant estimates include the valuation and impairment of intangible assets, stock-based compensation, and the recognition of revenue from licensing and distribution agreements. Actual results may differ from those estimates.
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Outlook
Management expects operating expenses to remain elevated as the Company continues to develop licensing opportunities, pursue strategic acquisitions, evaluate opportunities in the nightlife and hospitality sector, and meet its obligations as a public company. While management believes that the Company’s strategic shift toward licensing, distribution, and selected acquisitions may provide improved margins and scalability, the Company expects to continue incurring net losses in the near term. The Company’s ability to achieve profitability will depend on its ability to generate sustainable revenues, control operating costs, and secure additional financing as needed.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures. Our principal executive officer and principal financial officer, after evaluating the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of the end of the period covered by this Quarterly Report on Form 10-Q, have concluded that, based on such evaluation, our disclosure controls and procedures were effective to ensure that information required to be disclosed by us in the 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, and is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, 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, identified in connection with the evaluation of such internal control that occurred during the quarter ended March 31, 2025, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Management’s Quarterly Report on Internal Control over Financial Reporting. Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, as a process designed by, or under the supervision of, our principal executive officer and principal financial officer and effected by our board of directors, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that:
| ● | pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; |
| ● | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of management and our directors; and |
| ● | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements. |
Based on our evaluation of internal controls, our management concluded that there is a lack of segregation of duties identified. As a result our internal controls over financial reporting were not effective as of March 31, 2026.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
We know of no material, existing, or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers, or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.
ITEM 1A. RISK FACTORS
As a smaller reporting company, we are not required to provide the information required by this item.
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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
The Company is authorized to issue 75,000,000 shares of common stock, par value $0.001 per share. As of March 31, 2026, there were 43,690,580 shares of common stock issued and outstanding.
Set forth below is information regarding the issuance and sales of securities without registration since inception. No such sales involved the use of an underwriter; no advertising or public solicitation was involved; the securities bear a restrictive legend; and no commissions were paid in connection with the sale of any securities.
As of March 31, 2026, we have issued an aggregate of 11,520,580 shares: 9,400,000 shares to 10 people for services, 173,913 shares for an asset, and an aggregate of 1,946,667 shares for cash. The related amounts recorded were as follows: shares issued for services — common stock of $9,400 and additional paid-in capital of $754,795; shares issued for cash — common stock of $1,947 and additional paid-in capital of $156,991; and shares issued for asset acquisition — common stock of $174 and additional paid-in capital of $295,393. The issuances were exempt from registration under Section 4(a)(2) of the Securities Act as issuances not involving a public offering.
Such issuances were made to a limited number of non-affiliated individuals and non-affiliated entities as follows:
| · | On June 8, 2025, the Company issued 1,500,000 shares of common stock to a non-affiliated entity for services. |
| · | On June 9, 2025, the Company issued 1,000,000 shares of common stock to a non-affiliated individual for services. |
| · | On July 5, 2025, the Company issued 500,000 shares of common stock to a non-affiliated individual for services. |
| · | On July 8, 2025, the Company issued 1,000,000 shares of common stock to a non-affiliated entity for services. |
| · | On July 29, 2025, the Company issued 66,667 shares of common stock to a non-affiliated individual for cash. |
| · | On August 20, 2025, the Company issued 173,913 shares of common stock to a non-affiliated entity in exchange for an asset. |
| · | On September 23, 2025, the Company issued 200,000 shares of common stock to a non-affiliated individual for services. |
| · | On October 10, 2025, the Company issued 500,000 shares of common stock to a non-affiliated entity for services. |
| · | On October 15, 2025, the Company issued an aggregate of 1,780,000 shares of common stock, consisting of 1,500,000 shares issued to a non-affiliated entity for services and 280,000 shares issued to a non-affiliated individual for cash. |
| · | On November 1, 2025, the Company issued 1,400,000 shares of common stock to a non-affiliated individual for services. |
| · | On November 3, 2025, the Company issued 1,000,000 shares of common stock to a non-affiliated individual for services. |
| · | On November 12, 2025, the Company issued 1,000,000 shares of common stock to a non-affiliated individual for services. |
| · | On November 28, 2025, the Company issued 400,000 shares of common stock to a non-affiliated individual for cash. |
| · | On January 23, 2026 the Company issued 500,000 shares of common stock to a non-affiliated individual for cash. |
| · | On January 28, 2026 the Company issued 500,000 shares of common stock to a non-affiliated individual for cash. |
Warrants
During 2025, the Company issued warrants to purchase an aggregate of 946,667 shares of common stock to the Beling Family Trust. During the three months ended March 31, 2026, the Company issued additional warrants to purchase an aggregate of 1,000,000 shares of common stock to the Beling Family Trust.
A summary of warrant activity for the three months ended March 31, 2026 is as follows:
| Warrants | Weighted Average Exercise Price | |||||||||
| Outstanding at December 31, 2025 | 946,667 | $ | 0.08 | |||||||
| Granted | 1,000,000 | $ | 0.05 | |||||||
| Exercised | — | $ | — | |||||||
| Expired | — | $ | — | |||||||
| Outstanding at March 31, 2026 | 1,946,667 | $ | 0.06 | |||||||
| Exercisable at March 31, 2026 | 1,946,667 | $ | 0.06 | |||||||
As of March 31, 2026, 1,946,667 warrants were outstanding and exercisable, with a weighted average exercise price of $0.06 per share.
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The following table summarizes warrants outstanding at March 31, 2026:
| Grant Date | Shares Under Warrant | Exercise Price | Expiration Date | Exercise Terms | ||||||||||
| July 29, 2025 | 66,667 | $ | 0.30 | July 29, 2028 | Cash exercise | |||||||||
| September 8, 2025 | 200,000 | $ | 0.10 | September 8, 2028 | Cash exercise | |||||||||
| October 15, 2025 | 280,000 | $ | 0.05 | October 15, 2028 | Cash exercise | |||||||||
| November 28, 2025 | 400,000 | $ | 0.05 | November 28, 2028 | Cash exercise | |||||||||
| January 23, 2026 | 500,000 | $ | 0.05 | January 23, 2029 | Cash exercise | |||||||||
| January 28, 2026 | 500,000 | $ | 0.05 | January 28, 2029 | Cash exercise | |||||||||
| Total / Weighted Average | 1,946,667 | $ | 0.06 | |||||||||||
We have never utilized an underwriter for an offering of our securities. Other than the securities mentioned above and the common stock issuances described below, we have not issued or sold any other securities.
During the three months ended March 31, 2026, the Company issued 1,000,000 shares of common stock to the Beling Family Trust for aggregate proceeds of $50,000 pursuant to subscription agreements.
On February 5, 2022, the Company issued 230,000 shares of common stock to Andrew Read at $.01 for $2,300. On December 28, 2023, the Company issued 22,000,000 shares of common stock to Andrew Read at $.01 for services. The issuances were exempt from registration by reason of Section (4)(a)(2) of the Securities act as issuances not involving a public offering.
The company issued 6,940,000 shares in a Regulation D, Rule 506 offering which was filed with the SEC on March 11, 2022, done in compliance with Section (4)(a)(2) of the 1933 Act, at an offering price of $0.01 per share, resulting in total proceeds of $69,400 and a sale of 6,940,000 shares in aggregate. None of the investors are affiliated with any of our directors, officers or promoters or any beneficial owner of 10% or more of our securities
As of March 31, 2026, the Company had 43,690,580 shares of common stock issued and outstanding.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
ITEM 6. EXHIBITS
| Incorporated by Reference | Filed or Furnished | |||||||||
| No. | Exhibit Description | Form | Date Filed | Number | Herewith | |||||
| 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. | Filed | ||||||||
| 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. | Furnished | ||||||||
| 101. | Interactive Data files | Filed | ||||||||
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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: May 14, 2026 | TRADEWINDS UNIVERSAL | |
| By: | /s/ Andrew Read | |
| Andrew Read, | ||
| Chief Executive Officer | ||
| /s/ Andrew Read | ||
| Andrew Read, | ||
| Chief Financial Officer | ||
In accordance with the requirements of the Securities Act of 1933, as amended, this registration statement has been signed by the following persons in the capacities and on the dates stated.
| SIGNATURE | TITLE | DATE |
/s/ Andrew Read Andrew Read |
President/Chief Executive Officer and Director(principal executive officer) | May 14, 2026 |
/s/ Andrew Read Andrew Read |
Chief Financial Officer and Director (principal accounting officer) | May 14, 2026 |
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