Marquie Group Restates Q3, Net Loss Soars to $2.4M Amid Investment Markdown

TL;DR

**TMGI is a dumpster fire, with a massive $2.4M loss and a 'going concern' warning; steer clear unless you're a distressed asset shark.**

AI Summary

Marquie Group, Inc. (TMGI) filed a 10-Q/A for the quarter ended August 31, 2025, restating financial statements to correct misclassification of interest-bearing promissory notes. The company reported net revenues of $11,920 for the three months ended August 31, 2025, a significant increase from $0 in the prior year. However, TMGI experienced a substantial net loss of $2,430,080 for the quarter, a dramatic increase from a net loss of $204,944 in the same period last year. This loss was heavily influenced by a $3,700,000 loss on markdown of investment, partially offset by a $1,760,461 gain on extinguishment of debt. Total assets decreased from $6,258,966 on May 31, 2025, to $2,610,783 on August 31, 2025, primarily due to a reduction in investment in acquisition from $6,200,000 to $2,500,000. The company's accumulated deficit worsened to $18,242,017, and it reported negative working capital of $4,310,228, raising substantial doubt about its ability to continue as a going concern. TMGI is attempting to improve conditions through additional equity issuances and revenue generation from product and service sales.

Why It Matters

This restatement and significant net loss of $2.43 million are critical for investors, signaling severe financial distress and a 'going concern' risk for Marquie Group. The substantial markdown of a $3.7 million investment and negative working capital of $4.31 million highlight operational challenges and potential liquidity issues. For employees and customers, this raises questions about the company's long-term viability and ability to deliver on its 'Whim' health and beauty product line. In a competitive health and beauty market, TMGI's financial instability could hinder its ability to innovate and compete effectively, potentially leading to further market share erosion or even bankruptcy.

Risk Assessment

Risk Level: high — The risk level is high due to the 'going concern' warning, an accumulated deficit of $18,242,017, and negative working capital of $4,310,228 as of August 31, 2025. The company's net loss dramatically increased to $2,430,080 for the quarter, driven by a $3,700,000 loss on markdown of investment, indicating significant financial instability and operational challenges.

Analyst Insight

Investors should exercise extreme caution and consider divesting any holdings in TMGI given the 'going concern' warning, substantial net loss, and negative working capital. The company's reliance on future equity issuances and revenue generation to survive indicates a highly speculative investment with significant downside risk.

Financial Highlights

debt To Equity

N/A

revenue

$11,920

operating Margin

-727.4%

total Assets

$2,610,783

total Debt

$4,374,195

net Income

-$2,430,080

eps

-$0.59

gross Margin

N/A

cash Position

$41,007

revenue Growth

N/A

Revenue Breakdown

Key Numbers

• $2.43M — Net Loss (Increased from $204,944 in prior year, indicating significant financial deterioration.)
• $11.9K — Net Revenues (First reported revenue for the period, up from $0 in the prior year, but still minimal.)
• $3.7M — Loss on Markdown of Investment (Major contributor to the net loss for the quarter.)
• $1.76M — Gain on Extinguishment of Debt (Partially offset the significant losses, but not enough to prevent a large net loss.)
• $18.24M — Accumulated Deficit (Worsened from $15.81M, highlighting long-term unprofitability.)
• $4.31M — Negative Working Capital (Indicates severe short-term liquidity issues.)
• $41,007 — Cash and Cash Equivalents (Low cash balance, up from $1,071, but insufficient for sustained operations.)
• $0.59 — Net Loss Per Common Share (Increased from $0.06 in the prior year, reflecting greater losses per share.)
• 4,121,479 — Shares Outstanding (As of October 3, 2025, after a 1-for-1,000 reverse stock split.)
• $2.61M — Total Assets (Decreased significantly from $6.26M, primarily due to investment markdown.)

Key Players & Entities

• Marquie Group, Inc. (company) — Registrant filing 10-Q/A
• SEC (regulator) — Recipient of the 10-Q/A filing
• $2,430,080 (dollar_amount) — Net loss for the three months ended August 31, 2025
• $11,920 (dollar_amount) — Net revenues for the three months ended August 31, 2025
• $3,700,000 (dollar_amount) — Loss on markdown of investment for the three months ended August 31, 2025
• $1,760,461 (dollar_amount) — Gain on extinguishment of debt for the three months ended August 31, 2025
• $18,242,017 (dollar_amount) — Accumulated deficit as of August 31, 2025
• $4,310,228 (dollar_amount) — Negative working capital as of August 31, 2025
• Florida (regulator) — State of incorporation for Marquie Group, Inc.
• Whim (company) — Health and beauty product line of The Marquie Group, Inc.

FAQ

Risk Factors

• Going Concern Uncertainty [high — financial]: The company reported a substantial net loss of $2,430,080 for the quarter ended August 31, 2025, a significant increase from $204,944 in the prior year. This, coupled with negative working capital of $4,310,228 and an accumulated deficit of $18,242,017, raises substantial doubt about its ability to continue as a going concern.
• Significant Investment Loss [high — financial]: A loss of $3,700,000 on the markdown of investment significantly impacted the company's financial performance for the quarter. This single event contributed heavily to the overall net loss.
• Deteriorating Liquidity [high — financial]: Total assets decreased from $6,258,966 to $2,610,783, primarily due to a reduction in 'Investment in Acquisition' from $6,200,000 to $2,500,000. The company also has negative working capital of $4,310,228, indicating severe short-term liquidity issues.
• Increased Operating Expenses [medium — financial]: Total operating expenses increased to $98,474 for the three months ended August 31, 2025, from $60,640 in the prior year. While revenues also increased, the expense growth outpaced it, contributing to the loss from operations.
• Reliance on Debt Extinguishment Gains [medium — financial]: The company reported a gain on extinguishment of debt of $1,760,461, which partially offset significant losses. This suggests a reliance on financial restructuring rather than core operational profitability for financial relief.
• Restatement of Financials [medium — operational]: The company filed a 10-Q/A to restate its financial statements due to the misclassification of interest-bearing promissory notes. This indicates potential weaknesses in internal controls and accounting practices.

Industry Context

Marquie Group operates in a challenging environment, with its recent financial performance indicating significant distress. The company's focus on health and beauty products, as suggested by its 'Whim' product line, places it in a competitive consumer goods sector. However, its current financial instability and operational restructuring suggest it is not yet a significant player in its chosen markets.

Regulatory Implications

The restatement of financial statements due to accounting misclassifications highlights potential deficiencies in internal controls and compliance. Investors should monitor for any further SEC scrutiny or regulatory actions related to these accounting errors.

What Investors Should Do

1. Monitor future filings closely for signs of improved liquidity and operational stability.
2. Evaluate the company's ability to generate sustainable revenue and manage expenses effectively.
3. Assess the impact of the significant investment markdown and debt restructuring on the company's long-term strategy.
4. Consider the substantial going concern risks before making any investment decisions.

Key Dates

• 2025-08-31: Quarter ended August 31, 2025 — Period of significant financial deterioration, marked by a large net loss and asset reduction.
• 2025-06-05: 1-for-1,000 reverse stock split effective — Reduced outstanding shares significantly, impacting per-share metrics and potentially stock price perception.
• 2025-05-31: Balance sheet date prior to restatement — Provides a baseline for comparison of asset and liability changes in the current period.
• 2024-08-31: Quarter ended August 31, 2024 — Period of smaller net loss and no reported revenue, serving as a comparison for current period's performance.

Glossary

Accumulated Deficit

The cumulative net losses of a company that have not been offset by net income. (Indicates the company's long-term unprofitability, which has worsened to $18,242,017.)

Working Capital

The difference between a company's current assets and current liabilities. Positive working capital indicates short-term financial health. (The company has negative working capital of $4,310,228, signaling severe short-term liquidity problems.)

Going Concern

An assumption that a company will continue to operate for the foreseeable future. (The company's financial condition raises substantial doubt about its ability to continue as a going concern.)

Extinguishment of Debt

The process of retiring debt, often through repayment or repurchase, which can result in a gain or loss. (The company recognized a significant gain of $1,760,461 from debt extinguishment, which partially offset its losses.)

Markdown of Investment

A reduction in the carrying value of an investment due to a decrease in its market value or impairment. (The company recorded a substantial loss of $3,700,000 due to a markdown of its investment.)

Reverse Stock Split

A corporate action to reduce the number of outstanding shares of stock, usually to increase the stock's market price. (The company underwent a 1-for-1,000 reverse stock split effective June 5, 2025, impacting share counts and per-share metrics.)

Year-Over-Year Comparison

Compared to the prior year's quarter, Marquie Group, Inc. has seen a dramatic increase in net loss, from $204,944 to $2,430,080, despite generating its first reported revenues of $11,920. Total assets have shrunk significantly from $6,258,966 to $2,610,783, largely due to a reduction in investment. The company's financial position has deteriorated, with a worsening accumulated deficit and negative working capital, amplifying concerns about its viability.

Key Financial Figures

• $0.0001 — 3, 2025 there were 4,121,479 shares of $0.0001 par value common stock, issued and outs
• $4,310,228 — Company had negative working capital of $4,310,228 and an accumulated deficit of $ 18,242,
• $10,000 — March 1, 2017 – monthly compensation of $10,000 to May 31, 2022, increased to $20,000 a
• $20,000 — f $10,000 to May 31, 2022, increased to $20,000 after May 31, 2022, balance of $ 848,81
• $15,000 — gust 16, 2018 – monthly compensation of $15,000 (which was terminated May 31, 2021), ba
• $5,000 — ber 30, 2019) – monthly compensation of $5,000 to November 30, 2019 (converted into pr
• $1,000 — ber 30, 2019) – monthly compensation of $1,000 to November 30, 2019 – 48,000 Due t
• $2,500 — e to a family trust, stated interest of $2,500, due on October 31, 2015, extinguished
• $1,052 — in default, net of discount of $-0- and $1,052, respectively (K) 3,500 3,500 Conve
• $19,338 — in default, net of discount of $-0- and $19,338, respectively (L) 30,555 30,555 Con
• $25,000 — On April 22, 2015, the Company issued a $25,000 Promissory Note, non-interest bearing (
• $50,000 — On July 24, 2015, the Company issued a $50,000 Promissory Note to Kodiak Capital Group
• $72,750 — V) On May 3, 2017, the Company issued a $72,750 Convertible Promissory Note to a lender
• $0.1293 — on stock at a Conversion Price equal to $0.1293 per share. (W) On April 5, 2017, the C
• $35,000 — On April 5, 2017, the Company issued a $35,000 Convertible Promissory Note to a lender

Filing Documents

• marquie_i10qa1-083125.htm (10-Q/A) — 538KB
• marquie_ex3101.htm (EX-31.1) — 12KB
• marquie_ex3201.htm (EX-32.1) — 4KB
• 0001683168-25-008116.txt ( ) — 3456KB
• tmgi-20250831.xsd (EX-101.SCH) — 35KB
• tmgi-20250831_cal.xml (EX-101.CAL) — 39KB
• tmgi-20250831_def.xml (EX-101.DEF) — 85KB
• tmgi-20250831_lab.xml (EX-101.LAB) — 247KB
• tmgi-20250831_pre.xml (EX-101.PRE) — 204KB
• marquie_i10qa1-083125_htm.xml (XML) — 449KB

: FINANCIAL INFORMATION

PART I: FINANCIAL INFORMATION

: Financial Statements

Item 1: Financial Statements 4

: Management's Discussion and Analysis of Financial Condition and Results of Operation

Item 2: Management's Discussion and Analysis of Financial Condition and Results of Operation 18

: Quantitative and Qualitative Disclosures about Market Risk

Item 3: Quantitative and Qualitative Disclosures about Market Risk 21

: Controls and Procedures

Item 4: Controls and Procedures 21

: OTHER INFORMATION

PART II: OTHER INFORMATION

: Legal Proceedings

Item 1: Legal Proceedings 22

: Risk Factors

Item 1A: Risk Factors 22

: Unregistered Sales of Equity Securities and Use of Proceeds

Item 2: Unregistered Sales of Equity Securities and Use of Proceeds 22

: Defaults Upon Senior Securities

Item 3: Defaults Upon Senior Securities 22

: Mine Safety Disclosures

Item 4: Mine Safety Disclosures 22

: Other Information

Item 5: Other Information 22

: Exhibits

Item 6: Exhibits 22

- FINANCIAL INFORMATION

PART I - FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements THE MARQUIE GROUP, INC. Consolidated Balance Sheets August 31, May 31, 2025 2025 (Unaudited) (As restated – see Note 10) ASSETS CURRENT ASSETS Cash and cash equivalents $ 41,007 $ 1,071 Accounts receivable 22,960 11,040 Total Current Assets 63,967 12,111 OTHER ASSETS Investment in Acquisition 2,500,000 6,200,000 Loans receivable, related party 35,237 35,237 Music inventory, net of accumulated depreciation of $ 21,854 and $ 21,815 , respectively 414 453 Trademark costs 11,165 11,165 Total Other Assets 2,546,816 6,246,855 TOTAL ASSETS $ 2,610,783 $ 6,258,966 LIABILITIES AND STOCKHOLDERS' DEFICIT CURRENT LIABILITIES Accounts payable and accrued liabilities 123,636 106,217 Accrued interest payable on notes payable 934,518 1,182,097 Accrued consulting fees – 351,700 Notes payable 635,801 1,409,646 Notes payable to related parties 2,616,792 2,086,815 Derivative liability 63,448 625,824 Total Current Liabilities 4,374,195 5,762,299 TOTAL LIABILITIES 4,374,195 5,762,299 STOCKHOLDERS' EQUITY Preferred Stock, $ 0.0001 par value; 20,000,000 shares authorized, 200 and 200 shares issued and outstanding – – Common stock, $ 0.0001 par value; 5,000,000,000 shares authorized, 4,121,479 and 4,212,498 shares issued and outstanding, respectively 411 421 Additional paid-in-capital 16,478,194 16,308,184 Accumulated deficit ( 18,242,017 ) ( 15,811,938 ) Total Stockholders' Equity ( 1,763,412 ) 496,667 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 2,610,783 $ 6,258,966 The accompanying notes are an integral part of these

financial statements

financial statements 4 THE MARQUIE GROUP, INC. Consolidated Statements of Operations (Unaudited) For the Three Months Ended August 31, 2025 August 31, 2024 (As restated – see Note 10) NET REVENUES $ 11,920 $ – OPERATING EXPENSES Salaries and Consulting fees 6,180 60,000 Professional fees 79,220 – Other selling, general and administrative 13,074 640 Total Operating Expenses 98,474 60,640 LOSS FROM OPERATIONS ( 86,554 ) ( 60,640 ) OTHER INCOME (EXPENSES) Gain on extinguishment of debt 1,760,461 – Income (expense) from derivative liability 297,276 ( 37,232 ) Loss on markdown of investment ( 3,700,000 ) – Interest expense (including amortization of debt discounts of $- 0 -, and $ 19,900 , respectively) ( 701,263 ) ( 107,072 ) Total Other Income (Expenses) ( 2,343,526 ) ( 144,304 ) LOSS BEFORE INCOME TAXES ( 2,430,080 ) ( 204,944 ) INCOME TAX EXPENSE – – NET LOSS $ ( 2,430,080 ) $ ( 204,944 ) BASIC AND DILUTED: Net loss per common share $ ( 0.59 ) $ ( 0.06 ) Weighted average shares outstanding 4,133,725 3,325,531 The accompanying notes are an integral part of these

financial statements

financial statements 5 THE MARQUIE GROUP, INC. Consolidated Statements of Stockholders' Equity (Deficit) (Unaudited) Three Months Ended August 31, 2025 Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholders' Equity Shares Amount Shares Amount Capital Deficit (Deficit) Balance, May 31, 2025 200 $ – 4,212,498 $ 421 $ 16,308,184 $ ( 15,811,937 ) $ 496,667 Common stock cancelled for Standby Equity Agreement – – ( 95,933 ) ( 10 ) 10 – – Forgiveness of SBA PPP loans – – – – 170,000 – 170,000 Round up of shares for reverse split – – 4,914 – – – – Net loss for the three months ended August 31, 2025 – – – – – ( 2,430,080 ) ( 2,430,080 ) Balance, August 31, 2025 200 $ – 4,121,479 $ 411 $ 16,478,194 $ ( 18,242,017 ) $ ( 1,763,412 ) Three Months Ended August 31, 2024 Preferred Stock Common Stock Additional Paid-in Accumulated Total Stockholders' Equity Shares Amount Shares Amount Capital Deficit (Deficit) Balance, May 31, 2024 200 $ – 3,325,531 $ 333 $ 15,079,589 $ ( 14,863,486 ) $ 216,436 Net loss for the three months ended August 31, 2024 – – – – – ( 204,944 ) ( 204,944 ) Balance, August 31, 2024 200 $ – 3,325,531 $ 333 $ 15,079,589 $ ( 15,068,430 ) $ 11,492 Note: The above statements reflect retroactively the 1 share for 1,000 shares reverse split effective June 5, 2025. The accompanying notes are an integral part of these

financial statements

financial statements 6 THE MARQUIE GROUP, INC. Consolidated Statements of Cash Flows (Unaudited) For the Nine Months Ended August 31, 2025 August 31, 2024 CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ ( 2,430,080 ) $ ( 204,944 ) Adjustments to reconcile net income to net cash used by operating activities: Depreciation of music inventory 39 93 Change in fair value of derivative liability ( 297,276 ) 37,233 Amortization of debt discounts – 19,900 Default fees added to notes principal balance 565,836 – Gain on extinguishment of debt ( 1,760,461 ) – Loss on write down of investment 3,700,000 – Changes in operating assets and liabilities: Accounts receivable ( 11,920 ) – Accounts payable and accrued liabilities 17,419 – Accrued interest payable on notes payable 153,879 87,172 Accrued consulting fees – 60,000 Net Cash Used by Operating Activities ( 62,564 ) ( 546 ) CASH FLOWS FROM INVESTING ACTIVITIES: – – CASH FLOWS FROM FINANCING ACTIVITIES: Bank overdraft – 146 Proceeds from notes payable 132,500 – Repayments of notes payable to related parties ( 30,000 ) – Proceeds from notes payable to related parties – 400 Net Cash Provided by Financing Activities 102,500 546 NET INCREASE IN CASH AND CASH EQUIVALENTS 39,936 – CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 1,071 – CASH AND CASH EQUIVALENTS, END OF PERIOD $ 41,007 $ – SUPPLEMENTAL CASH FLOW INFORMATION Cash Payments For: Interest $ – $ – Income taxes $ – $ – Non-cash investing and financing activities: Forgiveness of SBA PPP loans recorded as equity $ 170,000 $ – Accrued consulting fees converted into promissory note $ 131,300 $ – The accompanying notes are an integral part of these

financial statements

financial statements 7 THE MARQUIE GROUP, INC. (formerly Music of Your Life, Inc.) Notes to the Consolidated

Financial Statements

Financial Statements August 31, 2025 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION Organization The Marquie Group, Inc. (formerly Music of Your Life, Inc.) (the "Company") was incorporated under the laws of the State of Florida on January 30, 2008, under the name of "Zhong Sen International Tea Company". From January 2008 to May 2013, the Company operated with the principal business objective of providing sales and marketing consulting services to small to medium sized Chinese tea producing companies who wished to export and distribute high quality Chinese tea products worldwide. On May 31, 2013 (the "Closing Date"), the Company entered into a Merger Agreement (the "Merger Agreement") by and among the Company, Music of Your Life, Inc., a Nevada corporation ("MYL Nevada") incorporated October 10, 2012, and Music of Your Life Merger Sub, Inc., a Utah corporation ("Merger Sub"), pursuant to which MYL Nevada merged with Merger Sub. As a result of the merger, MYL Nevada became a wholly owned subsidiary of the Company, and on July 26, 2013, the Company changed its name to Music of Your Life, Inc., a syndicated radio network. Reverse Stock Split Effective June 5, 2025, the Company effectuated a 1 share for 1,000 shares reverse stock split which reduced the issued and outstanding shares of common stock from 4,212,497,884 shares to 4,214,763 shares. The accompanying financial statements have been retroactively adjusted to reflect this reverse stock split. Basis of Presentation The accompanying unaudited financial statements are presented in accordance with generally accepted accounting principles for interim financial information and the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting only of normal recurring accruals

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