What changed in NextTrip, Inc.'s 10-K — 2023 vs 2024

ITEM 1. BUSINESS. The Company: NextTrip, Inc. (the “Company,” “NextTrip,” “we,” “us” and “our”) is an innovative technology company that is building next generation solutions to power the travel industry. NextTrip, through its subsidiaries, provides travel technology solutions with sales originating in the United States, leisure travel, business travel, groups travel, media and tech.

We connect people to new places and discoveries by utilizing digital media engagement, seasoned planning expertise, and unique inventory to curate custom vacations and business travel across the globe. Our proprietary booking engine, branded as NXT2.0, provides travel distributors and consumers access to a sizeable inventory.

Our vision is to drive the evolution of the travel industry by merging advanced digital solutions with personalized travel services. Our core technology – a fully integrated travel booking platform – focuses on untapped and underserved sectors of the travel industry, intending to capture new markets.

We expect that our future growth will be accelerated by interactive technology, immersive media and unparalleled travel industry expertise. We believe NextTrip will revolutionize the travel industry by combining advanced digital technologies with personalized travel services. Our mission is to become the premier travel, media, and lifestyle brand, inspiring and empowering individuals to explore the world.

Through our brands, including NextTrip Vacations, Travel Magazine, and Compass.TV, we aim to create a unique ecosystem that reduces dependency on traditional marketing methods, where major travel companies spend billions to attract customers.

Our strategy focuses on both the Media and Travel divisions working together to draw users into our ecosystem by offering the following benefits: ● Access to a wealth of highly relevant travel videos and articles for research. ● The ability to plan and save future travel destinations and activities on personalized profiles. ● Options to share travel ideas and communicate with others. ● Assistance from our concierge help desk and AI-powered solutions. ● The convenience of booking travel online or through a call center. ● Access to customer support before, during, and after travel. ● The opportunity to earn rewards that encourage repeat bookings.

Our ecosystem is built on four key pillars: 1. NextTrip : A comprehensive travel booking platform that offers curated, personalized, and seamless travel experiences for every budget and interest. Powered by the NXT2.0 booking platform, NextTrip serves as our direct-to-consumer hub, providing users with detailed scheduling, pricing, and availability information for airlines, hotels, rental cars, and other travel products.

We also offer dynamically assembled travel packages and provide valuable content, including destination information, maps, and travel details, all supported by our customer call center . 2. Travel Magazine : A trusted source of captivating travel inspiration, offering authentic stories, practical advice, and diverse perspectives to fuel wanderlust and create lasting vacation memories.

Travel Magazine will soon launch MyBucketList, a platform designed for travelers to build and share their travel bucket lists with personalized suggestions, booking support, and local insights. 3. Compass.TV : Our Free Ad-supported Streaming TV (FAST) channel, slated for launch in fall 2024. Compass.TV will offer over 1,000 hours of travel shows and long-form travel content at launch.

To draw users into the NextTrip ecosystem, the launch will be supported by travel influencers, promoted to our 6 million-strong email list, and marketed to major streaming platforms like Roku and YouTube. Compass.TV plans to use artificial intelligence to personalize content, convert blogs and articles to video, and enable users to create custom videos.

This platform will allow users to create fully customized FAST channels featuring vacation opportunities that can be explored and booked directly through the NextTrip booking engine. 4. PrometheanTV : A unique influencer-led platform that drives advertising revenue and content-to-commerce. We recently secured a perpetual license with Promethean TV, Inc., the developer of the Ignite TV interactive video platform.

This technology will power Compass.TV and video content on Travel Magazine/MyBucketList, allowing for targeted advertising via video overlays, enabling viewers to purchase travel directly from their screens. This integration is designed to enhance customer engagement, drive ad-supported revenue, and increase travel transactions.

By integrating the NextTrip booking platform across all our media platforms, we will enable users to research and book travel seamlessly from any of our offerings. Our ecosystem will encompass leisure travel, wellness travel, business travel, alternative lodging, and innovative technology and media solutions.

We will engage with consumers throughout the entire travel planning journey, from initial research to post-travel, offering robust product options and preferred rates in top global destinations. We believe that NextTrip stands apart from other travel companies, providing users with the tools to create personalized vacation packages and travel solutions, resulting in a more rewarding experience than traditional pre-packaged offerings.

This ensures a thriving and growing ecosystem that drives both travel transactions and targeted advertising revenue while supporting consumers on their travel journeys—truly a next-generation travel company. 3 Organizational History Historical Monaker Group Business NextTrip’s travel business was the principal business of NextPlay NextPlay Technologies, Inc. (“NextPlay”) (then, Monaker Group, Inc.

(“Monaker”)) until June 30, 2020, when Monaker entered into a share exchange transaction with HotPlay Enterprise Limited (“HotPlay”), resulting in HotPlay becoming a wholly owned subsidiary of Monaker and HotPlay’s business becoming the principal business of Monaker.

Prior to this share exchange, the primary focus of Monaker had been its travel business, which included the sale of vacation rentals, and in particular, ALRs, to consumers through its proprietary booking engine. To support its travel offerings, Monaker introduced travelmagazine.com, featuring travel and lifestyle content to appeal to travelers researching destinations and planning future vacations.

In January 2023, NextPlay spun the NextTrip business out to its founders to separate it from NextPlay’s primary business. COVID-era Transition and Technology Development The spread of the COVID-19 virus globally beginning in January 2020 severely impacted our business.

Beginning in March 2020, many U.S. states and foreign countries began issuing “stay-at-home” orders and closed their borders to interstate and international travel. Such restrictions on travel, together with other measures implemented by governments around the world, severely restricted the level of economic activity around the world and had an unprecedented effect on the global travel industry.

The public’s ability to travel was severely curtailed through border closures, mandated travel restrictions and limited operations of hotels, airlines, and additional voluntary or mandated closures of travel-related businesses from December 2019 through the beginning of 2022 (and beyond in some jurisdictions).

Measures implemented during the COVID-19 pandemic led to unprecedented levels of temporary and permanent business closures, cancellations and limited new travel bookings, having a severe negative impact on our business, financial condition and results of operations.

Due to the significant decrease in demand for the travel related services provided by us during the peak of the COVID-19 pandemic, we shifted our focus to developing and enhancing our program offerings.

For example, we began to develop our online media platform -TravelMagazine.com allowing consumers to research future travel options as well as enhancing the functionality of our booking engines, including developing a booking engine platform that allows customers to book packaged vacations and wellness programs along with the development of a platform to arrange and manage business travel.

Acquisition of Bookit.com Asset Following NextTrip’s separation from NextPlay, our team focused on the continued technological development of its booking platform. As part of this development, we acquired a travel platform in June 2022 to help power our proprietary NXT2.0 booking technology.

Previously, this technology powered the Bookit.com business, a well-established online leisure tour operator generating over $400 million in annual sales as recently as 2019 (pre-pandemic).

As part of the acquisition of the assets of Bookit.com, we were not only able to acquire a proven technology platform that could be integrated with our core travel sectors, but we were also able to secure the database with millions of past travelers and opt-in consumers.

Since 2022, and the acquisition of the Bookit.com business, we have been focused on the holistic development and integration of the NXT2.0 technology platform, which serves as a base for current and future technology projects as well as proprietary system enhancements.

This integration includes re-engaging with and re-negotiating more than 250 contracts with hotel, airline, and cruise suppliers, and securing unique product inventory of more than 3 million lodging, air and tour product suppliers at exceptional rates to over 2,100 destinations in 200+ countries worldwide.

Through this strategic offering, we will focus on key areas of opportunity in the travel sector and drive enhanced booking conversion rates. Our proprietary technology, when combined with media, product offerings and customer service, provides a unique lane to serve mid-to luxury travelers. Recent Developments Acquisition by Sigma Additive Solutions, Inc.; Name Change In December 2023, Sigma Additive Solutions, Inc.

(“Sigma”) acquired 100% of the outstanding equity interests in NextTrip, which resulted in NextTrip becoming a wholly-owned subsidiary of a public company and the principal business of the Company moving forward.

To align the new business with NextTrip’s travel-focused business model, the Company recently changed its name to “NextTrip, Inc.” Acquisition of Promethean FAST TV Exclusive License We recently entered into a perpetual license agreement with Promethean TV, Inc. (“Promethean”), the owner and developer of the Ignite TV interactive video platform used for driving engagement and commerce.

This license will form the basis for our Free Ad-supported streaming TV (FAST) channel – Compasss.TV allowing for targeted advertising via video overlays, allowing the viewer to purchase travel from their screen.

This integrated technology is intended to boost engagement with customers driving ad-supported revenue and travel transactions. 4 Our Fully Integrated Travel Booking Platform We have established a direct-to-consumer presence though a number of websites, powered by the NXT2.0 booking platform. Today, the primary leisure platform is hosted on nexttrip.com and the media platform is hosted on travelmagazine.com.

NextTrip sells travel services to leisure and corporate customers across these websites. Our primary focus is our current offerings of scheduling, pricing and availability information for booking reservations for airlines, hotels, rental cars, as well as other travel products such as transfers, sightseeing tours, shows and event tickets.

NextTrip sells these travel services both individually and as components of dynamically assembled packaged travel vacations and trips. In addition, we provide content that presents travelers with information about travel destinations, maps and other travel details. Our online travel publication, travelmagazine.com, provides travelers around the world with inspiration for future vacation destinations and trips.

The publication offers written articles, videos, and podcasts. The website is expected to be supported by advertising and allow for research and booking of vacation products. 5 Travel Products and Services We are building an ecosystem with technology and product offerings that will include leisure travel, wellness travel, business travel, alternative lodging, technology and media solutions.

We engage with consumers and distributors throughout the travel planning journey from initial research through post-travel. Through direct relationships, we have established robust product offerings and preferred rates across the top destinations world-wide.

Our revenue is derived from the global travel industry and would be significantly impacted by declines in, or disruptions to, travel activity, particularly air travel.

Global factors over which we have no control, but which could impact our clients’ willingness to travel and, depending on the scope and duration, cause a significant decline in travel volumes include, among other things: ● widespread health concerns, epidemics or pandemics, such as the COVID-19 pandemic, the Zika virus, H1N1 influenza, the Ebola virus, avian flu, SARS or any other serious contagious diseases; ● global security concerns caused by terrorist attacks, the threat of terrorist attacks, or the precautions taken in anticipation of such attacks, including elevated threat warnings or selective cancellation or redirection of travel; ● cyber-terrorism, political unrest, the outbreak of hostilities or escalation or worsening of existing hostilities or war, such as Russia’s invasion of Ukraine and the military conflict in Israel, resulting sanctions imposed by the U.S. and other countries and retaliatory actions taken by sanctioned countries in response to such sanctions; ● natural disasters or severe weather conditions, such as hurricanes, flooding and earthquakes; ● climate change-related impact to travel destinations, such as extreme weather, natural disasters and disruptions, and actions taken by governments, businesses and supplier partners to combat climate change; ● the occurrence of travel-related accidents or the grounding of aircraft due to safety concerns; ● the impact of macroeconomic conditions (including inflation) and labor shortages on the cost and availability of airline travel; and ● adverse changes in visa and immigration policies or the imposition of travel restrictions or more restrictive security procedures.

Any decrease in demand for consumer or business travel could materially and adversely affect our business, financial condition and results of operations. 11 We need additional capital, which may not be available on commercially acceptable terms, if at all, which raises questions about our ability to continue as a going concern.

As of February 29, 2024, we had $5,088,842 in total assets, $1,960,813 in total liabilities, negative working capital of $245,005 and a total accumulated deficit of $24,151,139. We had a net loss of $7,339,276 for the fiscal year ended February 29, 2024 and $5,033,496 for the fiscal year ended February 28, 2023.

We are subject to all the substantial risks inherent in the development of a new business enterprise within an extremely competitive industry. Due to the absence of a long-standing operating history and the emerging nature of the markets in which it competes, we anticipate operating losses until we can successfully implement our business strategy, which includes all associated revenue streams.

Our revenue model is new and evolving, and we cannot be certain that it will be successful. The potential profitability of this business model is unproven. We may never achieve profitable operations or generate significant revenues.

Our future operating results depend on many factors, including demand for our products, the level of competition, and the ability of our officers to manage our business and growth. Additional development expenses may delay or negatively impact our ability to generate profits.

Accordingly, we cannot assure you that our business model will be successful or that we can sustain revenue growth, achieve or sustain profitability, or continue as a going concern.

The Company believes that, in the aggregate, it could require several millions of dollars to support and expand the marketing and development of its products, repay debt obligations, provide capital expenditures for additional equipment and development costs, payment obligations, office space and systems for managing the business, and cover other operating costs until its planned revenue streams from all products are fully implemented and begin to offset its operating costs.

We estimate that we will need to raise a minimum of $5.5 million in net proceeds to continue operations for the next twelve months.

Our revenues for the years ended February 29, 2024 and February 28, 2023 were $458,752 and $382,832, respectively, and our operating expenses for those periods were $5,740,577 and $4,979,766, respectively. Our current revenues are not sufficient to fund our operations.

Risks relating to its indebtedness include: ● increasing our vulnerability to general adverse economic and industry conditions; ● requiring us to dedicate a portion of our cash flow from operations to principal and interest payments on our indebtedness, thereby reducing the availability of cash flow to fund working capital, capital expenditures, acquisitions and investments and other general corporate purposes; ● making it more difficult for us to optimally capitalize and manage the cash flow for our businesses; ● limiting our flexibility in planning for, or reacting to, changes in our businesses and the markets in which we operate; ● possibly placing us at a competitive disadvantage compared to our competitors that have less debt; and ● limiting our ability to borrow additional funds or to borrow funds at rates or on other terms that we find acceptable. 12 If distributors are unable to drive customers to our websites and/or we are unable to drive visitors to our websites, from search engines or otherwise, this could negatively impact transactions on the websites of our distributors as well as our own websites and consequently cause our travel revenue to decrease.

Many visitors find the distributors and NextTrip’s websites by searching for vacation information through Internet search engines. A critical factor in attracting visitors to NextTrip’s websites, and those of our distributors, is how prominently our distributors and NextTrip are displayed in response to search queries.

Accordingly, we utilize search engine marketing, or SEM, as a means to provide a significant portion of our visitor acquisition. SEM includes both paid visitor acquisition (on a cost-per-click basis) and unpaid visitor acquisition, which is often referred to as organic search. We plan to employ search engine optimization, or SEO, to acquire visitors.

SEO involves developing NextTrip’s websites in order to rank highly in relevant search queries. In addition to SEM and SEO, we may also utilize other forms of marketing to drive visitors to our websites, including branded search, display advertising and email marketing.

The various search engine providers, such as Google and Bing, employ proprietary algorithms and other methods for determining which websites are displayed for a given search query and how highly websites rank.

Search engine providers may change these methods in a way that may negatively affect the number of visitors to our distributors’ websites as well as our own websites and may do so without public announcement or detailed explanation.

Therefore, the success of our SEO and SEM strategy depends, in part, on our ability to anticipate and respond to such changes in a timely and effective manner. In addition, websites must comply with search engine guidelines and policies. These guidelines and policies are complex and may change at any time.

If we or our distributors fail to follow such guidelines and policies properly, the search engine may cause our content to rank lower in search results or could remove the content altogether.

If we or our distributors fail to understand and comply with these guidelines and policies and ensure their websites’ compliance, our SEO and SEM strategy may not be successful. Unfavorable changes in, or interpretations of, government regulations or taxation of the evolving product offerings, Internet and e-commerce industries could harm our travel division operating results.

We have contracted for products in markets throughout the world, in jurisdictions which have various regulatory and taxation requirements that can affect our travel division operations or regulate the activity of travel suppliers.

Compliance with laws and regulations of different jurisdictions imposing different standards and requirements is very burdensome because each region has different regulations with respect to licensing and other requirements. Our online marketplaces are accessible by travelers in many states and foreign jurisdictions. Compliance requirements that vary significantly from jurisdiction to jurisdiction impose added costs and increased liabilities for compliance deficiencies.

In addition, laws or regulations that may harm our business could be adopted, or interpreted in a manner that affects our activities, including but not limited to the regulation of personal and consumer information and real estate licensing requirements.

Violations or new interpretations of these laws or regulations may result in penalties, negatively impact our operations and damage our reputation and business.

In addition, many of the fundamental statutes and regulations that impose taxes or other obligations on travel and lodging companies were established before the growth of the Internet and e-commerce, which creates a risk of these laws being used, in ways not originally intended, that could burden travel suppliers or otherwise harm our business.

These and other similar new and newly interpreted regulations could increase costs for, or otherwise discourage, suppliers from partnering with NextTrip, which could harm its business and operating results.

Furthermore, as we expand or change the products and services that we offer or the methods by which we offer them, we may become subject to additional legal regulations, tax requirements or other risks. Regulators may seek to impose regulations and requirements on us even if we utilize third parties to offer the products or services.

These regulations and requirements may apply to payment processing, insurance products or the various other products and services we may now or in the future offer or facilitate through our marketplace.

Whether we comply with or challenge these additional regulations, our costs may increase, and our business may otherwise be harmed. 13 If we are not able to maintain and enhance our NextTrip brand and the brands associated with each of our websites, our reputation and business may suffer .

It is important for NextTrip to maintain and enhance its brand identity in order to attract and retain travel suppliers and customers. The successful promotion of our brands will depend largely on our marketing and public relations efforts.