C2 Blockchain's Q3 Loss Widens to $2.37M Amid Soaring Expenses

TL;DR

**CBLO is burning cash faster than it can raise it, making it a highly speculative bet with a clear 'going concern' risk.**

AI Summary

C2 Blockchain, Inc. (CBLO) reported a significant net loss of $2,369,980 for the three months ended September 30, 2025, a substantial increase from the $7,784 net loss in the same period last year. Revenue from staking rewards was negligible at $44. The company's operating expenses surged to $302,933, up from $7,784 year-over-year, primarily due to general and administrative costs. A major contributor to the net loss was $2,067,091 in other income/loss, including $642,120 in interest expense, a $933,879 loss on change in fair market value of derivative liability, and a $491,092 loss on change in fair value of cryptocurrency. CBLO's cash and cash equivalents increased to $148,102 from $9, largely due to $1,930,333 in financing activities, including $1,675,000 from common share sales and $217,000 from convertible notes. The company's intangible assets, primarily DOG cryptocurrency, grew to $1,082,426 from $62,474, driven by $1,511,000 in purchases. Despite these capital injections, CBLO faces substantial doubt about its ability to continue as a going concern due to persistent operating losses and a working capital deficiency.

Why It Matters

This filing reveals C2 Blockchain's precarious financial health, marked by a dramatic increase in net loss and a 'going concern' warning. For investors, this signals extreme risk, as the company relies heavily on stock sales and related-party contributions to fund operations, with no clear path to sustainable revenue. Employees face uncertainty regarding job security given the company's early stage and financial constraints. Customers, if any, might question the long-term viability of a blockchain infrastructure business struggling with profitability. In the competitive blockchain market, CBLO's inability to generate substantive revenue or control expenses puts it at a significant disadvantage against more established and better-capitalized players.

Risk Assessment

Risk Level: high — The company explicitly states 'adverse conditions that raise substantial doubt about the Company's ability to continue as a going concern for one year' due to 'negative financial trends, specifically operating loss, working capital deficiency, and other adverse key financial ratios.' This is evidenced by a net loss of $2,369,980 for the quarter and negligible revenue of $44 from staking rewards.

Analyst Insight

Investors should exercise extreme caution and consider avoiding CBLO shares given the explicit 'going concern' warning, significant operating losses, and reliance on dilutive financing. Monitor future filings for any substantive revenue generation or a clear strategy to achieve profitability, as the current financial state is unsustainable.

Financial Highlights

debt To Equity

N/A

revenue

$44

operating Margin

-821,600%

total Assets

$1,234,903

total Debt

$1,863,333

net Income

-$2,369,980

eps

-$0.01

gross Margin

N/A

cash Position

$148,102

revenue Growth

N/A

Revenue Breakdown

Key Numbers

• $2.37M — Net Loss (Increased significantly from $7,784 in the prior year, indicating worsening financial performance.)
• $44 — Total Revenue (Extremely low, highlighting the lack of substantive income generation.)
• $302.9K — Operating Expenses (Jumped from $7,784 year-over-year, showing a rapid increase in costs without corresponding revenue.)
• $1.08M — Intangible Assets (Cryptocurrency) (Increased from $62,474, primarily due to $1,511,000 in cryptocurrency purchases.)
• $1.93M — Net Cash from Financing (Crucial for funding operations, including $1,675,000 from common share sales.)
• $1.60M — Derivative Liability (New liability as of September 30, 2025, contributing to total liabilities of $1,863,333.)
• 409.4M — Common Shares Outstanding (As of November 19, 2025, indicating significant dilution from 274,736,005 shares on June 30, 2025.)
• $148.1K — Cash and Cash Equivalents (Increased from $9, but still low given the burn rate.)
• $2.67M — Accumulated Deficit (Worsened from $297,784, reflecting ongoing losses.)
• $628.4K — Total Stockholders' Deficit (Increased from $8,449, indicating negative equity.)

Key Players & Entities

• C2 Blockchain, Inc. (company) — registrant
• Levi Jacobson (person) — Chief Executive Officer, Chief Financial Officer, and Director
• $2,369,980 (dollar_amount) — net loss for the three months ended September 30, 2025
• $44 (dollar_amount) — total revenue from staking rewards
• $302,933 (dollar_amount) — total operating expenses for the three months ended September 30, 2025
• $1,082,426 (dollar_amount) — intangible assets - cryptocurrency as of September 30, 2025
• $1,511,000 (dollar_amount) — cryptocurrency purchased for cash during the period
• $148,102 (dollar_amount) — cash and cash equivalents as of September 30, 2025
• $1,930,333 (dollar_amount) — net cash provided by financing activities
• Kraken (company) — principal market for determining fair value of digital assets

FAQ

Risk Factors

• Substantial doubt about going concern [high — financial]: The company faces substantial doubt about its ability to continue as a going concern due to persistent operating losses and a working capital deficiency. The net loss for the three months ended September 30, 2025, was $2,369,980, a significant increase from $7,784 in the prior year.
• Significant increase in operating expenses [high — financial]: Operating expenses surged to $302,933 for the three months ended September 30, 2025, from $7,784 in the prior year. This increase is primarily driven by general and administrative costs, indicating a rapid escalation of operational overhead without a corresponding revenue increase.
• Volatile cryptocurrency valuations [medium — financial]: The company experienced a $491,092 loss on the change in fair value of cryptocurrency during the three months ended September 30, 2025. This highlights the inherent volatility and risk associated with holding digital assets.
• Derivative liability and fair value fluctuations [high — financial]: A new derivative liability of $1,597,514 was recorded as of September 30, 2025, contributing to a $933,879 loss on its change in fair market value. This introduces significant financial risk and potential for further losses.
• High interest expense [high — financial]: The company incurred $642,120 in interest expense for the three months ended September 30, 2025. This substantial expense, likely related to financing activities, further exacerbates the net loss.
• Dilution from share issuance [medium — financial]: The company's common shares outstanding increased to 409,444,338 as of November 19, 2025, from 274,736,005 on June 30, 2025. This significant dilution, driven by $1,675,000 in common share sales, can negatively impact existing shareholders.
• Development-stage business risks [high — operational]: As a development-stage company, C2 Blockchain, Inc. faces substantial operational and financial constraints that may impact the timing, scope, and execution of its planned activities. The lack of significant revenue generation underscores these early-stage challenges.
• Evolving cryptocurrency regulations [medium — regulatory]: The company operates in the rapidly evolving cryptocurrency space, which is subject to changing regulatory landscapes globally. Unforeseen regulatory changes could materially impact the company's operations, profitability, and the value of its digital assets.

Industry Context

C2 Blockchain, Inc. operates in the nascent and highly volatile blockchain and cryptocurrency sector. This industry is characterized by rapid technological advancements, intense competition from both established players and startups, and a dynamic regulatory environment. Companies in this space often focus on areas like cryptocurrency mining, digital asset management, and blockchain infrastructure development, facing challenges in revenue generation and profitability.

Regulatory Implications

The company's operations in the cryptocurrency space expose it to evolving regulatory scrutiny. Changes in regulations concerning digital assets, mining, and financial reporting for crypto-related activities could impact C2 Blockchain's business model, compliance costs, and the valuation of its assets.

What Investors Should Do

1. Monitor cash burn and financing activities closely.
2. Assess the sustainability of the current business model.
3. Evaluate the impact of derivative and cryptocurrency volatility.
4. Consider the implications of share dilution.
5. Understand the going concern disclosure.

Key Dates

• 2025-09-30: Quarterly period ended — Reporting period for the 10-Q, showing a significant increase in net loss and operating expenses.
• 2025-11-19: Common shares outstanding reported — Indicates a substantial increase in shares outstanding, signaling significant dilution.
• 2025-06-30: End of prior fiscal year — Baseline for comparison of financial performance and position changes.

Glossary

Derivative Liability

An obligation arising from a financial contract whose value is derived from an underlying asset, index, or rate. Changes in the fair value of this liability can significantly impact net income. (A new and substantial derivative liability of $1,597,514 was recorded, leading to a significant loss on its change in fair value, heavily impacting the company's net loss.)

Accumulated Deficit

The total cumulative net losses of a company since its inception, less any cumulative net income. A negative number indicates the company has never been profitable. (The accumulated deficit has worsened significantly to $2,667,765, reflecting the company's ongoing inability to generate profits.)

Going Concern

An accounting assumption that a business will continue to operate for the foreseeable future. If there is substantial doubt about this, it must be disclosed. (Management has identified substantial doubt about the company's ability to continue as a going concern, a critical warning for investors.)

Intangible assets - cryptocurrency

Non-physical assets representing ownership or rights to digital currencies, valued based on their fair market value. These are subject to high volatility. (The company's primary non-current asset is cryptocurrency, which grew substantially to $1,082,426 due to purchases, but its value is highly susceptible to market fluctuations.)

Convertible notes

Debt instruments that can be converted into a predetermined amount of equity (common stock) of the issuing company. They often carry interest and may have conversion discounts. (The company issued convertible notes totaling $217,000, which contributed to financing activities but also represent future potential dilution.)

Staking rewards

Income earned by holding and validating cryptocurrency transactions on a proof-of-stake blockchain network. It's a form of passive income for crypto holders. (The company generated only $44 in revenue from staking rewards, indicating this is not a significant income stream.)

Working capital deficiency

A situation where a company's current liabilities exceed its current assets, indicating a potential short-term liquidity problem. (This deficiency is cited as a reason for substantial doubt about the company's going concern status.)

Year-Over-Year Comparison

Compared to the three months ended September 30, 2024, C2 Blockchain, Inc. has experienced a dramatic deterioration in financial performance. Revenue remains negligible at $44, while net loss has ballooned from $7,784 to $2,369,980. Operating expenses have surged from $7,784 to $302,933, primarily due to general and administrative costs. New significant liabilities, including a derivative liability of $1,597,514 and substantial interest expense of $642,120, have emerged, contributing to a worsening financial position and raising substantial doubt about the company's ability to continue as a going concern.

Key Financial Figures

• $7,500 — 66-day invoice for advertising totaling $7,500. These were expensed through September
• $20,000 — al interest. The Coventry Note includes $20,000 of guaranteed interest and was issued w
• $10,000 — original issue discount of $20,000 and $10,000 allocated to legal documentation fees,
• $170,000 — lting in net proceeds to the Company of $170,000. The Coventry Note is repayable in 12 e
• $18,333.33 b — ble in 12 equal monthly installments of $18,333.33 beginning on August 22, 2025, and maturin
• $36,667 — 025, the Company made payments totaling $36,667 and intends to make monthly payments of
• $18,333 — and intends to make monthly payments of $18,333 through July 2026 to pay the note in fu
• $50,000 — fault. . The aggregate debt discount of $50,000 is being amortized to interest expense
• $6,667 — es in nine months. The QC Note includes $6,667 of guaranteed interest and was issued w
• $5,556 — sued with an original issue discount of $5,556 and $3,000 allocated to legal documenta
• $3,000 — n original issue discount of $5,556 and $3,000 allocated to legal documentation fees,
• $47,000 — lting in net proceeds to the Company of $47,000. The combined $62,222 total owed to Qui
• $62,222 — to the Company of $47,000. The combined $62,222 total owed to Quick Capital is converti
• $43,044 — e warrants had a relative fair value of $43,044 which was recorded as a discount on the

Filing Documents

• c2blockq111425o.htm (10-Q) — 413KB
• exhibit31.htm (EX-31) — 12KB
• exhibit32.htm (EX-32) — 7KB
• 0001882781-25-000042.txt ( ) — 2010KB
• cblo-20250930.xsd (EX-101.SCH) — 24KB
• cblo-20250930_cal.xml (EX-101.CAL) — 13KB
• cblo-20250930_def.xml (EX-101.DEF) — 25KB
• cblo-20250930_lab.xml (EX-101.LAB) — 127KB
• cblo-20250930_pre.xml (EX-101.PRE) — 106KB
• c2blockq111425o_htm.xml (XML) — 227KB

SIGNATURES

SIGNATURES 6 -2- Table of Contents PART I - FINANCIAL INFORMATION C2 Blockchain, Inc. Balance Sheets (Unaudited) September 30, 2025 June 30, 2025 (Audited) ASSETS CURRENT ASSETS Cash and cash equivalents $ 148,102 $ 9 Prepaid Expenses 4,375 13,068 Total Current Assets 152,477 13,077 NON-CURRENT ASSETS Intangible assets - cryptocurrency $ 1,082,426 $ 62,474 TOTAL ASSETS $ 1,234,903 $ 75,551 LIABILITIES AND STOCKHOLDERS' DEFICIT CURRENT LIABILITIES Accrued liabilities $ 107,000 $ 84,000 Convertible loans, net of discount 158,819 - Derivative Liability 1,597,514 - TOTAL LIABILITIES $ 1,863,333 $ 84,000 Stockholders' Equity (Deficit) Preferred stock ($ .001 par value, 20,000,000 shares authorized; 0 issued and outstanding as of September 30, 2025, and June 30, 2025) - - Common stock ($ .001 par value, 500,000,000 shares authorized, 393,319,338 and 274,736,005 shares issued and outstanding as of September 30, 2025, and June 30, 2025, respectively) 393,319 274,736 Additional paid-in capital 1,571,016 ( 35,401 ) Shares payable 75,000 50,000 Accumulated deficit ( 2,667,765 ) ( 297,784 ) Total Stockholders' Equity (Deficit) ( 628,430 ) ( 8,449 ) TOTAL LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT) $ 1,234,903 $ 75,551 The accompanying notes are an integral part of these unaudited financial statements. F-1 Table of Contents C2 Blockchain, Inc. of Operations (Unaudited) Three Months Ended September 30, 2025 Three Months Ended September 30, 2024 Revenue Staking rewards $ 44 $ - Total revenue 44 - Operating expenses General and administrative expenses 302,933 7,784 Total operating expenses 302,933 7,784 Operating Income (Loss) ( 302,889 ) ( 7,784 ) Other Income/(Loss) Interest Expense ( 642,120 ) - Loss on change in fair market value of derivative liability ( 933,879 ) - Gain

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View this 10-Q filing on SEC EDGAR