Pineapple Financial Inc.

What they do

The company operates mortgage brokerage, underwriting, insurance, subscription-based software, sponsorship and other technology-enabled financial services in the Canadian residential mortgage market. During the nine months ended May 31, 2026, it established a Digital Asset Treasury strategy covering acquisition, financing, custody and staking of digital assets under a Treasury Reserve Policy. It now evaluates the business through two reportable operating segments: Mortgage Operations and Crypto Asset Operations. It is listed on NYSE American under the symbol PAPL and is incorporated in Canada.

Revenue drivers

• Mortgage Operations — Revenue comes from mortgage brokerage, underwriting, insurance, subscription-based software, sponsorship and other technology-enabled financial services in the Canadian residential mortgage market. This is the historical core business and was the primary reported revenue source in the latest quarters.
• Crypto Asset Operations - staking income — The company generated $620,849 of staking income during the nine months ended May 31, 2026, according to the latest 10-Q MD&A.
• Digital asset fair value gains — The company held digital assets with a fair value of approximately $49.4 million as of May 31, 2026. Under ASC 350-60 these are measured at fair value with changes recognized in earnings, producing non-cash fair value gains that management says materially affected reported net income.

Recent performance

Annual revenue was $2.7M in fiscal 2024 and $3.0M in fiscal 2025, after $3.6M in 2022 and $2.5M in 2023. Annual net losses were $4.1M in fiscal 2024 and $3.6M in fiscal 2025, versus $2.8M losses in both 2022 and 2023. Recent quarterly revenue declined across the four reported quarters: $730,537 for 2025-08-31, $721,727 for 2025-11-30, $707,342 for 2026-02-28 and $622,502 for 2026-05-31. Operating cash flow was negative in every year shown, at -$946,820 in fiscal 2025. As of May 31, 2026, total assets were $75.9M, total liabilities $24.2M and shareholder equity $51.6M.

Strategy

Management describes two complementary platforms: Mortgage Operations focused on originations, recurring subscription revenue, agent productivity technology and operating efficiency, and Crypto Asset Operations focused on the Digital Asset Treasury strategy. That strategy covers acquisition, financing, custody and staking of digital assets and is governed by a Treasury Reserve Policy setting liquidity, governance, custody, financing and risk management requirements. Management states it evaluates non-cash fair value adjustments on digital assets together with operating performance, liquidity and capital management. The company also disclosed a remediation plan for an internal control weakness related to segregation of duties, including independent review of journal entries and reconciliations, a quarter-end close checklist, external expert augmentation and system access restrictions.

Risks

• Material weakness in internal control — Management concluded a material weakness existed as of August 31, 2025 related to segregation of duties in the finance function due to limited personnel, and that disclosure controls and procedures were not effective, partly because of the late filing of the fiscal 2025 Form 10-K.
• Persistent losses and negative operating cash flow — The company reported annual net losses in each year from 2022 through 2025 and negative operating cash flow every year, including -$946,820 in fiscal 2025.
• Declining core revenue — Reported quarterly revenue fell from $730,537 in the quarter ended 2025-08-31 to $622,502 in the quarter ended 2026-05-31, and management attributes mortgage market weakness to housing affordability, elevated borrowing costs and reduced origination activity.
• Digital asset exposure and fair value volatility — The company held approximately $49.4 million of digital assets at May 31, 2026 measured at fair value through earnings under ASC 350-60, and maintains financing arrangements supporting treasury activities, so market moves can drive large non-cash swings in reported net income.

Outlook

The 10-Q MD&A does not present specific forward financial guidance. Management says Mortgage Operations will continue to focus on origination volumes, recurring revenue, agent productivity technology and operating efficiency despite a soft mortgage market. It says Crypto Asset Operations will continue the Digital Asset Treasury strategy, and that the company will evaluate non-cash fair value adjustments alongside operating performance and liquidity. Management also says it expects to strengthen segregation of duties as additional resources become available, with target controls listed in its remediation plan.