Marquie Group's Net Loss Widens to $2.3M Amid Investment Markdown

TL;DR

**TMGI is a speculative bet, with a massive net loss and a going concern warning making it a high-risk play for traders.**

AI Summary

Marquie Group, Inc. (TMGI) reported a net loss of $2,306,313 for the three months ended August 31, 2025, a significant increase from the $204,944 net loss in the prior year period. Revenue for the quarter was $11,920, up from zero in the same period last year. The company's total assets decreased substantially from $6,258,966 on May 31, 2025, to $2,610,783 on August 31, 2025, primarily due to a $3,700,000 loss on markdown of investment. Total liabilities also decreased from $5,762,299 to $4,250,428, driven by a $1,760,461 gain on extinguishment of debt and a reduction in notes payable. TMGI's negative working capital worsened to $4,186,461 and its accumulated deficit grew to $18,118,250, raising substantial doubt about its ability to continue as a going concern. The company executed a 1-for-1,000 reverse stock split on June 5, 2025, reducing outstanding shares from 4,212,497,884 to 4,214,763.

Why It Matters

This filing reveals Marquie Group's precarious financial health, with a substantial net loss and a going concern warning, which is critical for investors assessing long-term viability. The significant markdown of an investment and the large accumulated deficit indicate operational challenges and potential capital erosion, impacting shareholder value. For employees and customers, the going concern risk suggests instability. In a competitive market, TMGI's inability to generate substantial revenue from its 'Whim' health and beauty product line, despite its business plan, puts it at a severe disadvantage against better-capitalized rivals.

Risk Assessment

Risk Level: high — The company explicitly states a 'substantial doubt regarding the Company's ability to continue as a going concern' due to negative working capital of $4,186,461 and an accumulated deficit of $18,118,250 as of August 31, 2025. The net loss of $2,306,313 for the quarter, coupled with a $3,700,000 loss on markdown of investment, further exacerbates its financial instability.

Analyst Insight

Investors should exercise extreme caution and consider avoiding TMGI given the explicit 'going concern' warning and significant financial deterioration. Those already invested should re-evaluate their position, as the company's strategy to improve conditions through equity issuances and product sales appears insufficient to offset its substantial losses and debt burden.

Financial Highlights

debt To Equity

N/A

revenue

$11,920

operating Margin

N/A

total Assets

$2,610,783

total Debt

$4,250,428

net Income

-$2,306,313

eps

-$0.56

gross Margin

N/A

cash Position

$41,007

revenue Growth

N/A

Revenue Breakdown

Key Numbers

• $2,306,313 — Net Loss (for the three months ended August 31, 2025, significantly higher than $204,944 in prior year)
• $11,920 — Net Revenues (for the three months ended August 31, 2025, up from $0 in prior year)
• $3,700,000 — Loss on markdown of investment (contributed to the increased net loss for the quarter)
• $1,760,461 — Gain on extinguishment of debt (recorded for the quarter ended August 31, 2025)
• $4,186,461 — Negative Working Capital (as of August 31, 2025, indicating liquidity issues)
• $18,118,250 — Accumulated Deficit (as of August 31, 2025, highlighting historical losses)
• 4,121,479 — Shares of Common Stock Outstanding (as of October 3, 2025, after a 1-for-1,000 reverse stock split)
• $41,007 — Cash and Cash Equivalents (as of August 31, 2025, a modest increase from $1,071 on May 31, 2025)

Key Players & Entities

• Marquie Group, Inc. (company) — registrant
• Music of Your Life, Inc. (company) — former name of registrant
• Zhong Sen International Tea Company (company) — original name of registrant
• Kodiak Capital Group, LLC (company) — lender for a $50,000 promissory note
• Small Business Administration (regulator) — forgave PPP loans of $70,000 and $100,000
• Whim (company) — health and beauty product line
• Florida Statute 95.11(2)(b) (regulator) — statute cited for debt extinguishment
• SEC (regulator) — Securities and Exchange Commission

FAQ

Risk Factors

• Going Concern Uncertainty [high — financial]: The company reported a net loss of $2,306,313 for the three months ended August 31, 2025, and its accumulated deficit grew to $18,118,250. Negative working capital worsened to $4,186,461, raising substantial doubt about its ability to continue as a going concern.
• Significant Investment Loss [high — financial]: A substantial $3,700,000 loss on the markdown of an investment significantly impacted the company's financial performance for the quarter, contributing to the increased net loss.
• High Debt Burden [medium — financial]: Despite a gain on extinguishment of debt of $1,760,461, the company still has significant liabilities, with total liabilities at $4,250,428 as of August 31, 2025. Accrued interest payable on notes payable was $876,588.
• Limited Revenue Generation [medium — operational]: The company generated only $11,920 in net revenues for the three months ended August 31, 2025. This minimal revenue indicates a potential challenge in scaling operations and achieving profitability.
• Asset Depreciation [medium — financial]: Total assets decreased from $6,258,966 on May 31, 2025, to $2,610,783 on August 31, 2025, primarily due to the $3,700,000 loss on markdown of investment.
• Reverse Stock Split Impact [low — financial]: The company executed a 1-for-1,000 reverse stock split on June 5, 2025, reducing outstanding shares from 4,212,497,884 to 4,214,763. While intended to improve share price, it reflects underlying financial distress.

Industry Context

The Marquie Group operates in a challenging environment, with its recent financial performance indicating significant distress. The company's limited revenue generation and substantial losses suggest difficulties in establishing a viable business model or competing effectively in its sector. The industry likely faces pressures related to market demand, operational efficiency, and capital requirements, which appear to be impacting TMGI severely.

Regulatory Implications

The company's financial instability and the substantial doubt about its going concern status necessitate clear disclosures to investors and regulatory bodies. Failure to address these issues could lead to increased scrutiny from the SEC and potential delisting if trading on an exchange. Management must provide a credible plan for financial recovery to satisfy regulatory expectations.

What Investors Should Do

1. Review management's plan for addressing going concern issues.
2. Analyze the sustainability of the $11,920 in revenue.
3. Understand the nature and recoverability of the 'Investment in Acquisition'.
4. Monitor future debt extinguishment activities and their impact.

Key Dates

• 2025-08-31: End of the three-month reporting period — The period for which the company reported a significant net loss of $2,306,313 and a substantial decrease in assets.
• 2025-06-05: Reverse Stock Split — The company executed a 1-for-1,000 reverse stock split, reducing outstanding shares from over 4.2 billion to approximately 4.2 million.
• 2025-05-31: Prior period balance sheet date — Represents the starting point for asset and liability changes during the reported quarter, with total assets at $6,258,966 and total liabilities at $5,762,299.
• 2024-08-31: Prior year period reporting date — The company reported a net loss of $204,944 and zero revenue for the comparable period in the previous year.

Glossary

Accumulated deficit

The cumulative net losses of a company that have not been offset by net income. (Indicates the company's history of unprofitability, reaching $18,118,250 as of August 31, 2025.)

Working Capital

The difference between a company's current assets and current liabilities. Negative working capital indicates a potential short-term liquidity issue. (The company's negative working capital worsened to $4,186,461 as of August 31, 2025, highlighting liquidity concerns.)

Going Concern

An assumption that a company will continue to operate for the foreseeable future. If there is substantial doubt about a company's ability to continue as a going concern, it must be disclosed. (The company's financial condition raises substantial doubt about its ability to continue as a going concern.)

Reverse Stock Split

A corporate action to reduce the number of outstanding shares of stock, typically to increase the share price. (The company implemented a 1-for-1,000 reverse stock split, significantly reducing its share count.)

Gain on extinguishment of debt

A profit recognized when a company repays debt for less than its carrying amount. (The company recorded a $1,760,461 gain on extinguishment of debt, which offset some of its operating losses.)

Loss on markdown of investment

A loss recognized when the value of an investment is reduced below its carrying amount. (The company incurred a significant $3,700,000 loss on markdown of investment, a major contributor to its quarterly net loss.)

Year-Over-Year Comparison

Compared to the prior year period ended August 31, 2024, Marquie Group, Inc. (TMGI) has seen a dramatic shift in its financial performance. Net revenues have increased from $0 to $11,920, a positive development, but this is overshadowed by a significant increase in net loss from $204,944 to $2,306,313. Total assets have plummeted from $6,258,966 to $2,610,783, largely due to a substantial investment markdown. While total liabilities also decreased, the company's working capital position has deteriorated, and its accumulated deficit has grown, intensifying 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
• $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
• $27,500 — On April 5, 2017, the Company issued a $27,500 Convertible Promissory Note to a lender

Filing Documents

• marquie_i10q-083125.htm (10-Q) — 522KB
• marquie_ex3101.htm (EX-31.1) — 12KB
• marquie_ex3201.htm (EX-32.1) — 4KB
• 0001683168-25-007542.txt ( ) — 3374KB
• tmgi-20250831.xsd (EX-101.SCH) — 33KB
• tmgi-20250831_cal.xml (EX-101.CAL) — 38KB
• tmgi-20250831_def.xml (EX-101.DEF) — 83KB
• tmgi-20250831_lab.xml (EX-101.LAB) — 244KB
• tmgi-20250831_pre.xml (EX-101.PRE) — 201KB
• marquie_i10q-083125_htm.xml (XML) — 433KB

: FINANCIAL INFORMATION

PART I: FINANCIAL INFORMATION

: Financial Statements

Item 1: Financial Statements 3

: 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 17

: Quantitative and Qualitative Disclosures about Market Risk

Item 3: Quantitative and Qualitative Disclosures about Market Risk 20

: Controls and Procedures

Item 4: Controls and Procedures 20

: OTHER INFORMATION

PART II: OTHER INFORMATION

: Legal Proceedings

Item 1: Legal Proceedings 21

: Risk Factors

Item 1A: Risk Factors 21

: Unregistered Sales of Equity Securities and Use of Proceeds

Item 2: Unregistered Sales of Equity Securities and Use of Proceeds 21

: Defaults Upon Senior Securities

Item 3: Defaults Upon Senior Securities 21

: Mine Safety Disclosures

Item 4: Mine Safety Disclosures 21

: Other Information

Item 5: Other Information 21

: Exhibits

Item 6: Exhibits 21

- 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) 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 876,588 1,182,097 Accrued consulting fees – 351,700 Notes payable 569,964 1,409,646 Notes payable to related parties 2,616,792 2,086,815 Derivative liability 63,448 625,824 Total Current Liabilities 4,250,428 5,762,299 TOTAL LIABILITIES 4,250,428 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 ( 18,118,250 ) ( 15,811,938 ) Total Stockholders' Equity ( 1,639,645 ) 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 3 THE MARQUIE GROUP, INC. Consolidated Statements of Operations (Unaudited) For the Three Months Ended August 31, 2025 August 31, 2024 NET REVENUES $ 11,920 $ – OPERATING EXPENSES Salaries and Consulting fees 6,180 60,000 Professional fees 46,217 – Other selling, general and administrative 13,074 640 Total Operating Expenses 65,471 60,640 LOSS FROM OPERATIONS ( 53,551 ) ( 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) ( 610,499 ) ( 107,072 ) Total Other Income (Expenses) ( 2,252,762 ) ( 144,304 ) LOSS BEFORE INCOME TAXES ( 2,306,313 ) ( 204,944 ) INCOME TAX EXPENSE – – NET LOSS $ ( 2,306,313 ) $ ( 204,944 ) BASIC AND DILUTED: Net loss per common share $ ( 0.56 ) $ ( 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 4 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 – – – – – ( 2,306,313 ) ( 2,306,313 ) Balance, August 31, 2025 200 $ – 4,121,479 $ 411 $ 16,478,194 $ ( 18,118,250 ) $ ( 1,639,645 ) 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 5 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 $ ( 2,306,313 ) $ ( 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 500,000 – 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 95,948 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 6 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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