Note 1 - Organization and Nature of Operations

Organization and Nature of Operations

Nightfood Holdings, Inc. and its subsidiaries (“Nightfood,” “NGTF,” “we,” “our,” or the “Company”) operate as an AI-driven service robotics and hospitality technology company. Our primary focus is the development, deployment, and commercialization of AI-powered autonomous robots designed to improve operational efficiency across the hospitality, food service, and facilities-management industries.

To accelerate real-world testing and adoption of our technologies, we pursue strategic acquisitions of hospitality-related real estate assets. These hotels serve as controlled pilot environments where the Company can refine, validate, and showcase its robotics solutions at commercial scale.

In addition, our subsidiary CarryOutSupplies provides complementary logistical and supply-chain capabilities that support both internal operations and market penetration for our robotics products. This integrated structure enhances deployment efficiency, reduces operating friction, and strengthens our overall commercialization platform.

The Company’s operations are or will be organized into three (3) principal business segments:

Through its wholly owned subsidiary SWC Group, Inc. (d/b/a CarryOutSupplies.com), the Company operates as a business-to-business (“B2B”) enterprise focused on the wholesale distribution of disposable foodservice packaging products.

Product offerings include printed paper cups, plastic cups, food containers, bags, and related consumables for restaurants, cafés, and other foodservice establishments. Operations are conducted primarily through the Company’s e-commerce platform, www.carryoutsupplies.com, which serves customers across the United States.

Activities include product design, sourcing from domestic and international manufacturers, quality control, warehousing, and fulfillment. Customers are primarily small to mid-sized businesses in the hospitality and food service industries, with no material dependence on any single customer or supplier.

This segment began operations in connection with the acquisition on March 31, 2025.

Through its subsidiaries, Skytech Automated Solutions, Inc. (“Skytech”) and Future Hospitality Venture Holdings, Inc. (“FHVH”), the Company develops and delivers automation solutions aimed at enhancing efficiency and reducing labor dependency in foodservice and hospitality operations. These solutions focus on automating routine and repetitive tasks to improve service quality and operating margins.

NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES

DBA TECHFORCE ROBOTICS

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2025

On February 2, 2024, FHVH began using a DBA – RoboOp365.

On September 2, 2025, Skytech changed its name to TechForce Robotics, Inc.

Business Model

The Company offers its automation solutions under a Robotics-as-a-Service (RaaS) model, generally structured as multi-year lease and service agreements following an initial pilot and site preparation period. Under these arrangements, customers pay a recurring monthly fee for deployed equipment and related services. Fees may vary depending on the scale of deployment, number of units, and customer-specific requirements. The Company recognizes revenue on a monthly basis as services are rendered.

Equipment and Ownership

The Company owns and deploys its equipment, including robotics hardware, software, and related components. All deployed units remain the property of the Company, which is also responsible for equipment replacement and refurbishment as necessary.

Support and Maintenance

The Company provides ongoing support to ensure equipment performance, including remote technical assistance, software updates, and periodic inspections. In the event of equipment failure, replacement units are deployed to minimize customer disruption. To date, customer support needs have been minimal.

Operating Costs

Recurring operating costs consist primarily of equipment maintenance, software servicing, and connectivity. These costs are integrated into the overall RaaS model and managed as part of the Company’s service delivery.

Current Status

As of September 30, 2025, the Company had initiated early customer deployments under this model and commenced revenue-generating activities.

NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES

DBA TECHFORCE ROBOTICS

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2025

The Company has expanded its business model to include the acquisition, ownership, and operation of hotel properties. These properties are intended to serve both as revenue-generating hospitality operations and as dedicated deployment sites for the Company’s automation technologies, enabling the Company to test, validate, and scale operational efficiencies in live environments. The hospitality segment became active in connection with two business combinations completed during the fiscal year ended June 30, 2026.

Overview of Acquisitions

On August 27, 2025 and September 30, 2025, the Company acquired two hotel properties as part of its strategy to establish a hospitality asset ownership and operations platform. Each acquisition included the underlying real estate, buildings and improvements, hotel operating assets, and related working capital necessary to operate the facilities. The transactions also included franchise rights, liquor licenses, equipment, and other property integral to the hotels’ operations. In connection with the acquisitions, the Company assumed certain operating liabilities, including accounts payable, accrued expenses, and debt obligations secured by the properties.

Strategic Purpose

The acquired hotels support the Company’s strategy in two primary ways:

The Company believes that insights gained from these properties will contribute to improvements in operating efficiency, labor utilization, and the long-term scalability of its automation platform.

NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES

DBA TECHFORCE ROBOTICS

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2025

Franchise Operations

The Company owns and operates its hotels under long-term franchise agreements with established national hotel brands. These arrangements grant the Company the right to operate its hotels using the brand’s trademarks, systems, reservation channels, and operating standards in exchange for various franchise-related fees, which generally include:

Under each franchise agreement, the Company is required to comply with the brand’s operating manuals, service standards, and property-level specifications, including ongoing maintenance, periodic upgrades, and compliance with brand-mandated property improvement plans (“PIPs”). Failure to meet these requirements may result in financial penalties or loss of franchise rights. Franchise agreements generally have initial terms of 10 to 20 years and include renewal options subject to the franchisor’s approval. Transfers, encumbrances, or material modifications of a franchised hotel typically require prior franchisor consent.

The Company engages third-party hotel management companies to operate the hotel properties, as required under applicable franchise agreements. While day-to-day operations are managed by third-party operators, the Company retains responsibility for capital expenditures, compliance with franchise brand standards, and oversight of financial and operating performance.

Integration and Operating Status

Following the acquisitions, the Company initiated integration activities across both properties, including evaluations of site layouts, staffing structures, and operational workflows in preparation for automation deployments. Revenue from hotel operations will be recognized in accordance with ASC 606 and reported within the hospitality segment beginning in the period in which operations commence post-acquisition.

NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES

DBA TECHFORCE ROBOTICS

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2025

Financial Statement Impact

The hotel acquisitions have been accounted for as business combinations under ASC 805, Business Combinations. The related purchase price allocations—including the fair values of property and equipment, identifiable intangible assets, acquired working capital (deficit), and goodwill—See Note 9 for acquisitions of hotels on August 27, 2025 and September 30, 2025.

The Company previously operated a small legacy business related to the sale of snacks and beverages. These activities have since been discontinued and will not contribute to future revenues. Accordingly, revenues from this line are presented within discontinued operations and excluded from the Company’s disclosure of continuing revenue streams.

Discontinued Operations – Snack and Beverages Legacy Line

Management’s Decision

On June 30, 2025, the Company’s management elected to discontinue its nominal operations related to the legacy sale of snacks and beverages. This decision was made as part of a broader strategic reassessment of the Company’s business lines and a reaffirmation of management’s focus on its core revenue-generating operations. The Chief Operating Decision Maker (“CODM,” our Chief Executive Officer) had periodically evaluated the financial contribution of this line and determined that its continued operation was not aligned with the Company’s long-term strategic objectives.

Discontinued Operations Assessment (ASC 205-20)

The Company evaluated whether the discontinuation of its Snack and Beverages legacy business meets the criteria for classification as a discontinued operation. ASU 2014-08 provides that a discontinued operation must represent a strategic shift that has (or will have) a major effect on an entity’s operations and financial results.

NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES

DBA TECHFORCE ROBOTICS

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2025

Although the Snack and Beverages line generated only a quantitatively immaterial contribution to consolidated revenues and assets, management determined that the exit nonetheless represents a strategic shift under ASC 205-20 for the following reasons:

Accordingly, the Company has concluded that the discontinuation of its Snack and Beverages legacy business qualifies for presentation as a discontinued operation in the consolidated financial statements. The results of this activity will therefore be presented separately from continuing operations in the accompanying financial statements, with prior-period amounts reclassified for comparability.

Segment Reporting (ASC 280) Considerations

The Snack and Beverages activity was never managed or evaluated as a separate operating segment by the CODM, as the Company has historically operated and reported as a single segment. Accordingly, it was not disclosed as a reportable segment.

However, in connection with the discontinuation, management determined that this activity, while not separately reportable, represents a strategic shift away from a legacy business that is qualitatively distinct from the Company’s continuing operations.

NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES

DBA TECHFORCE ROBOTICS

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2025

In light of this discontinuation and the adoption of ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, effective July 1, 2024, the Company has reviewed its segment disclosures and determined:

Accounting and Financial Statement Impact

Because the activity is being abandoned rather than sold, it does not qualify as “held for sale”. However, the Company has concluded that the discontinuation represents a discontinued operation and will present the historical results of the Snack and Beverages line separately from continuing operations in the consolidated financial statements.

The Company does not anticipate recognizing any material exit costs, impairment losses, or restructuring charges associated with the discontinuation. Any remaining minor assets or liabilities will be derecognized in accordance with applicable accounting guidance.

Future Business Operations

The Snack and Beverages activity had no dedicated workforce, significant customer base, or ongoing contractual commitments. Its discontinuation will not result in employee layoffs, customer transitions, or contract terminations. The exit reflects management’s strategic decision to eliminate a non-core, consumer product line and to reinforce focus on the Company’s core operations, which generate the substantial majority of revenues and are expected to drive sustainable long-term growth.

See Note 14 for summary of the Company’s discontinued operations for the three months ended September 30, 2025 and 2024, respectively.

NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES

DBA TECHFORCE ROBOTICS

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2025

Fiscal Year

The Company’s fiscal year end is June 30.

Organizational Structure

 Schedule of Organizational Structure

1 Acquired on March 31, 2025.

2 Discontinued operations effective June 30, 2025.

3 Acquired August 27, 2025.

4 Acquired September 30, 2025.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial statements (“U.S. GAAP”).

Liquidity and Going Concern

As reflected in the accompanying unaudited condensed consolidated financial statements, for the three months ended September 30, 2025, the Company had:

Additionally, at September 30, 2025, the Company had:

NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES

DBA TECHFORCE ROBOTICS

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2025

Following the acquisitions of SWC and Skytech during the fiscal year ended June 30, 2025, the Company initiated early customer deployments under its Robotics-as-a-Service (“RaaS”) model and commenced revenue-generating activities. While these deployments represent an important step toward building recurring revenue, revenues to date are not sufficient to fund ongoing operations.

Similarly, after acquiring the Victorville and Rancho Mirage hotel properties during the fiscal year ended June 30, 2026, the Company began generating revenue within its hospitality segment. Although these hotels provide recurring operating revenue from lodging and related guest services, current levels of hotel revenue are also insufficient to support the Company’s ongoing operating and development activities.

Liquidity Outlook

Based on current operating levels and cash usage forecasts, the Company’s existing cash resources are not sufficient to fund operations for the twelve months following the issuance of these consolidated financial statements without obtaining additional financing.

Historically, the Company has relied on both third-party and related-party debt financing. There can be no assurance that additional financing will be available on commercially acceptable terms, or at all. Further, there is no assurance that any financing obtained will be sufficient to enable the Company to complete its strategic initiatives or achieve profitable operations.

The Company’s future capital requirements will depend on many factors, including its ability to scale the Foodservice Packaging and RaaS businesses, expand into new markets, invest in automation technology, respond to competitive pressures, and pursue strategic opportunities. Current capital needs include:

If the Company is unable to secure sufficient capital, it may be required to slow expansion efforts, reduce operating expenditures, or modify its strategic plans.

While the Company sees significant opportunity to grow recurring revenue through RaaS, its ability to execute on this opportunity depends on securing additional financing. If sufficient capital is not raised, the Company may be required to slow expansion plans, reduce operating activities, or adjust its overall strategy.

NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES

DBA TECHFORCE ROBOTICS

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2025

Going Concern

These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date these consolidated financial statements are issued.

The consolidated financial statements do not include any adjustments that might result if the Company is unable to continue as a going concern and have been prepared on a basis that assumes the Company will continue as a going concern and realize assets and satisfy liabilities in the ordinary course of business.

Management’s strategic plans to address these matters include the following:

Note 1 - Organization and Nature of Operations

Organization and Nature of Operations

Nightfood Holdings, Inc. and its subsidiaries (“Nightfood”, “NGTF”, “we,” “our,” or the “Company”) operate as a food service and hospitality technology and asset acquisition company. The Company’s activities are focused on the integration of AI-powered service robotics and future ownership and operation of hospitality-related real estate.

The Company’s operations are or will be organized into three (3) principal business segments:

Through its wholly owned subsidiary SWC Group, Inc. (d/b/a CarryOutSupplies.com), the Company operates as a business-to-business (“B2B”) enterprise focused on the wholesale distribution of disposable foodservice packaging products.

Product offerings include printed paper cups, plastic cups, food containers, bags, and related consumables for restaurants, cafés, and other foodservice establishments. Operations are conducted primarily through the Company’s e-commerce platform, www.carryoutsupplies.com, which serves customers across the United States.

Activities include product design, sourcing from domestic and international manufacturers, quality control, warehousing, and fulfillment. Customers are primarily small to mid-sized businesses in the hospitality and food service industries, with no material dependence on any single customer or supplier.

This segment began operations in connection with the acquisition on March 31, 2025.

Through its subsidiaries, Skytech Automated Solutions, Inc. (“Skytech”) and Future Hospitality Venture Holdings, Inc. (“FHVH”), the Company develops and delivers automation solutions aimed at enhancing efficiency and reducing labor dependency in foodservice and hospitality operations. These solutions focus on automating routine and repetitive tasks to improve service quality and operating margins.

On February 2, 2024, FHVH began using a DBA – RoboOp365.

On September 2, 2025, Skytech changed its name to TechForce Robotics, Inc.

Business Model

The Company offers its automation solutions under a Robotics-as-a-Service (RaaS) model, generally structured as multi-year lease and service agreements following an initial pilot and site preparation period. Under these arrangements, customers pay a recurring monthly fee for deployed equipment and related services. Fees may vary depending on the scale of deployment, number of units, and customer-specific requirements. The Company recognizes revenue on a monthly basis as services are rendered.

Equipment and Ownership

The Company owns and deploys its equipment, including robotics hardware, software, and related components. All deployed units remain the property of the Company, which is also responsible for equipment replacement and refurbishment as necessary.

Support and Maintenance

The Company provides ongoing support to ensure equipment performance, including remote technical assistance, software updates, and periodic inspections. In the event of equipment failure, replacement units are deployed to minimize customer disruption. To date, customer support needs have been minimal.

Operating Costs

Recurring operating costs consist primarily of equipment maintenance, software servicing, and connectivity. These costs are integrated into the overall RaaS model and managed as part of the Company’s service delivery.

Current Status

As of June 30, 2025, the Company had initiated early customer deployments under this model and commenced revenue-generating activities.

The Company intends to acquire, own, and operate hotel properties. These assets are expected to serve as both revenue-generating hospitality operations and deployment sites for the Company’s automation technologies, where operational efficiencies can be tested and scaled. This segment is not yet active.

See Note 16 for acquisitions of hotels on August 27, 2025 and September 30, 2025.

The Company previously operated a small legacy business related to the sale of snacks and beverages. These activities have since been discontinued and will not contribute to future revenues. Accordingly, revenues from this line are presented within discontinued operations and excluded from the Company’s disclosure of continuing revenue streams.

NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES

DBA TECHFORCE ROBOTICS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2025 AND 2024

Discontinued Operations – Snack and Beverages Legacy Line

Management’s Decision

Effective June 30, 2025, the Company’s management elected to discontinue its nominal operations related to the legacy sale of snacks and beverages. This decision was made as part of a broader strategic reassessment of the Company’s business lines and a reaffirmation of management’s focus on its core revenue-generating operations. The Chief Operating Decision Maker (“CODM,” our Chief Executive Officer) had periodically evaluated the financial contribution of this line and determined that its continued operation was not aligned with the Company’s long-term strategic objectives.

Discontinued Operations Assessment (ASC 205-20)

The Company evaluated whether the discontinuation of its Snack and Beverages legacy business meets the criteria for classification as a discontinued operation. ASU 2014-08 provides that a discontinued operation must represent a strategic shift that has (or will have) a major effect on an entity’s operations and financial results.

Although the Snack and Beverages line generated only a quantitatively immaterial contribution to consolidated revenues and assets, management determined that the exit nonetheless represents a strategic shift under ASC 205-20 for the following reasons:

Accordingly, the Company has concluded that the discontinuation of its Snack and Beverages legacy business qualifies for presentation as a discontinued operation in the consolidated financial statements. The results of this activity will therefore be presented separately from continuing operations in the accompanying financial statements, with prior-period amounts reclassified for comparability.

Segment Reporting (ASC 280) Considerations

The Snack and Beverages activity was never managed or evaluated as a separate operating segment by the CODM, as the Company has historically operated and reported as a single segment. Accordingly, it was not disclosed as a reportable segment.

However, in connection with the discontinuation, management determined that this activity, while not separately reportable, represents a strategic shift away from a legacy business that is qualitatively distinct from the Company’s continuing operations.

In light of this discontinuation and the adoption of ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, effective July 1, 2024, the Company has reviewed its segment disclosures and determined:

Accounting and Financial Statement Impact

Because the activity is being abandoned rather than sold, it does not qualify as “held for sale”. However, the Company has concluded that the discontinuation represents a discontinued operation and will present the historical results of the Snack and Beverages line separately from continuing operations in the consolidated financial statements.

The Company does not anticipate recognizing any material exit costs, impairment losses, or restructuring charges associated with the discontinuation. Any remaining minor assets or liabilities will be derecognized in accordance with applicable accounting guidance.

Future Business Operations

The Snack and Beverages activity had no dedicated workforce, significant customer base, or ongoing contractual commitments. Its discontinuation will not result in employee layoffs, customer transitions, or contract terminations. The exit reflects management’s strategic decision to eliminate a non-core, consumer product line and to reinforce focus on the Company’s core operations, which generate the substantial majority of revenues and are expected to drive sustainable long-term growth.

See Note 14 for summary of the Company’s discontinue operations for the years ended June 30, 2025 and 2024, respectively.

NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES

DBA TECHFORCE ROBOTICS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2025 AND 2024

Fiscal Year

The Company’s fiscal year end is June 30.

Organizational Structure

Schedule of Organizational Structure

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial statements (“U.S. GAAP”).

Liquidity and Going Concern

As reflected in the accompanying consolidated financial statements, for the year ended June 30, 2025, the Company had:

Additionally, at June 30, 2025, the Company had:

Following its recent acquisitions of SWC and Skytech, the Company has initiated early customer deployments under its Robotics-as-a-Service (“RaaS”) model and commenced revenue-generating activities. While these deployments represent an important step toward building recurring revenue, revenues to date are not sufficient to fund ongoing operations. Based on current operating levels and cash usage forecasts, existing cash resources are not sufficient to fund operations for the twelve months following the issuance of these financial statements without additional financing.

Historically, the Company has relied on third-party and related-party debt financing. There is no assurance that additional financing will be available on commercially acceptable terms, or at all. Furthermore, there is no assurance that any funds raised will be sufficient to enable the Company to complete its initiatives or achieve profitable operations.

The Company’s future capital requirements and the adequacy of its available funds will depend on many factors, including the ability to successfully scale both its Foodservice Packaging and RaaS businesses, expand into new markets, respond to competitive pressures, and pursue strategic opportunities. Current capital needs reflect investments in:

NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES

DBA TECHFORCE ROBOTICS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2025 AND 2024

Our capital needs reflect investments in:

While the Company sees significant opportunity to grow recurring revenue through RaaS, its ability to execute on this opportunity depends on securing additional financing. If sufficient capital is not raised, the Company may be required to slow expansion plans, reduce operating activities, or adjust its overall strategy.

These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date these consolidated financial statements are issued. The consolidated financial statements do not include any adjustments that might result if the Company is unable to continue as a going concern and have been prepared on a basis that assumes the Company will continue as a going concern and realize assets and satisfy liabilities in the ordinary course of business.

Management’s strategic plans to address these matters include the following: