v3.26.1
Taxes
 12 Months Ended
Apr. 30, 2026
Income Tax Disclosure [Abstract]  
Taxes
Note 9 — Taxes
The Company is subject to taxation in the United States (federal and various state jurisdictions), Canada (federal and provincial), and the Cayman Islands. The Cayman Islands does not impose corporate income tax, and, accordingly, the statutory income tax rate for the Company's Cayman Islands subsidiary is zero percent. The U.S. federal statutory rate is 21.0%, and the Canadian combined federal and provincial statutory rate is approximately 27.0% (Manitoba).
Components of (Loss) Income Before Income Taxes
The components of (loss) income before income taxes, disaggregated between domestic and foreign operations, are as follows:
SuccessorPredecessor
Period from
June 7, 2025
through
April 30, 2026		Period from
May 1, 2025
through
June 6, 2025		Year Ended April 30, 2025
United States
$
240,610 
$
— 
$
— 
Foreign
Canada
(1,549)
21 
707 
Cayman Islands
(124,188)
— 
— 
Total foreign
(125,737)
21 
707 
Income before income tax expense (benefit)
$
114,873 
$
21 
$
707 
Components of Income Tax Expense (Benefit)
The components of income tax expense (benefit) consist of the following:
SuccessorPredecessor
Period from
June 7, 2025
through
April 30, 2026		Period from
May 1, 2025
through
June 6, 2025		Year Ended April 30, 2025
Current
Federal
$
— 
$
— 
$
— 
State
— 
— 
— 
Foreign
426 
— 
263 
Total current
426 
— 
263 
Deferred
Federal
— 
— 
— 
State
— 
— 
— 
Foreign
(798)
2 
(126)
Total deferred
(798)
2 
(126)
Total income tax expense (benefit)
$
(372)
$
2 
$
137 
Effective Income Tax Rate Reconciliation
A reconciliation of the U.S. federal statutory income tax rate to the Company's effective income tax rate is presented below:
SuccessorPredecessor
Period from
June 7, 2025
through
April 30, 2026		Period from
May 1, 2025
through
June 6, 2025		Year Ended April 30, 2025
$%$%$%
Income before income tax expense (benefit)
$
114,873 
$
21 
$
707 
U.S. federal statutory income tax rate
$
24,123 
21.0 
%
$
4 
21.0 
%
$
149 
21.0 
%
State and local income tax, net of federal benefit
— 
— 
— 
— 
— 
— 
Canada
Statutory rate difference between Canada and the United States
(93)
(0.1)
1 
6.0 
42 
6.0 
Other permanent differences
47 
— 
(3)
(16.3)
(54)
(7.6)
Cayman Islands
Statutory rate difference between Cayman Islands and the United States
26,079 
22.7 
— 
— 
Changes in valuation allowances
4,084 
3.6 
— 
— 
— 
— 
Warrant valuation
(59,413)
(51.7)
— 
— 
— 
— 
Other
4,801 
4.2 
— 
— 
— 
— 
Income tax expense (benefit) and effective tax rate
$
(372)
(0.3)
$
2 
10.7 
$
137 
19.4 

The Company's effective tax rate differs from the U.S. federal statutory rate of 21.0% primarily due to (i) the impact of foreign earnings, including earnings of the Company's Canadian subsidiary that are taxed at the Canadian combined federal and provincial statutory rate (which is higher than the U.S. statutory rate) and earnings of the Company's Cayman Islands subsidiary that are not subject to income tax, (ii) changes in the valuation of warrants treated as liabilities under U.S. GAAP, (iii) non-deductible transaction costs incurred in connection with the Fat Panda Acquisition and other strategic transactions, (iv) U.S. tax inclusions on foreign income, and (v) changes in valuation allowances on deferred tax assets, principally those associated with the legacy U.S. operations of CEAI.
Deferred Tax Assets and Liabilities
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company's deferred tax assets and deferred tax liabilities are as follows:
SuccessorPredecessor
April 30, 2026April 30, 2025
Deferred tax assets:
Net operating loss carryforwards
$
12,201 
$
— 
Stock-based compensation
291 
— 
Accrued expenses and reserves
96 
— 
Operating lease liabilities
13 
514 
Other
770 
151 
Total deferred tax assets
13,371 
665 
Less: valuation allowance
(12,571)
— 
Net deferred tax assets
800 
665 
Deferred tax liabilities:
Intangible assets
(1,291)
— 
Right-of-use assets
— 
(510)
Total deferred tax liabilities
(1,291)
(510)
Net deferred tax asset (liability)
$
(491)
$
155 
Net Operating Loss Carryforwards
At April 30, 2026, the Company had approximately $71.0 million of U.S. federal and state net operating loss ("NOL") carryforwards related to its legacy U.S. operations. Approximately $11.2 million of these NOL carryforwards will expire, if not utilized, in calendar years 2034 through 2037. NOLs generated in tax years beginning after December 31, 2017 do not expire but may be used to offset no more than 80.0% of taxable income in any given year. State NOL carryforwards have varying expiration periods that range from 5 to 20 years, depending on the jurisdiction.
The Company's Canadian subsidiary had no material NOL carryforwards at April 30, 2026. The Company's Cayman Islands subsidiary is not subject to income tax and accordingly does not have NOL carryforwards.
Section 382 Considerations
Pursuant to Section 382 of the Internal Revenue Code of 1986, as amended, and applicable state law, the Company's ability to utilize its NOL carryforwards may be limited if the Company experiences an "ownership change," generally defined as a greater than 50.0% cumulative change in equity ownership by value over a rolling three-year period. The securities offerings completed in September 2021 and February 2022, the August 2025 private placement, and other equity transactions completed during the fiscal year must be evaluated to determine whether one or more ownership changes have occurred. The Company has not yet completed a formal Section 382 analysis at April 30, 2026. If an ownership change is determined to have occurred, the Company's ability to utilize its NOL carryforwards may be materially limited, which could adversely affect the Company's future tax obligations. The amount of NOL carryforwards reflected as deferred tax assets in the table above does not reflect any potential limitation that may result from such an analysis; however, any such limitation would not result in a charge to income tax expense given the full valuation allowance recorded against the related deferred tax assets.
Valuation Allowance
The Company assesses, on a quarterly basis, whether it is more likely than not that its deferred tax assets will be realized. In making this determination, the Company considers all available positive and negative evidence, including its history of cumulative losses, projected future taxable income, the period over which deferred tax assets are expected to reverse, and the availability of tax-planning strategies. The weight given to each piece of evidence is commensurate with the extent to which it can be objectively verified.
At April 30, 2026, based primarily on the existence of cumulative losses in recent years and the inherent uncertainty of forecasting future taxable income for the legacy U.S. operations, the Company concluded that it is more likely than not that its U.S. federal and state deferred tax assets will not be realized. Accordingly, the Company has recorded a full valuation allowance against its U.S. net deferred tax assets. The Company intends to maintain the valuation allowance until sufficient positive evidence exists to support its reversal. No valuation allowance has been recorded against the deferred tax assets of the Company's Canadian subsidiary, as the Company has determined it is more likely than not that those deferred tax assets will be realized.
Fat Panda Acquisition
Fat Panda is taxed as a Canadian corporation. For Canadian federal and provincial income tax purposes, the transaction was treated as a stock acquisition with no step-up in tax basis. As a result, the goodwill and identifiable intangible assets recorded for financial reporting purposes are not deductible for tax purposes, giving rise to a deferred tax liability of approximately $1.4 million on the Acquisition Date, which the Company includes in its consolidated net deferred tax liability. The Company has not asserted indefinite reinvestment of Fat Panda's undistributed earnings; however, no additional U.S. or Canadian income tax has been provided on such undistributed earnings as the Company believes any incremental tax cost upon repatriation would not be material.
Income Taxes Paid
Income taxes paid by the Company, net of refunds received, disaggregated by federal (national), state, and foreign jurisdiction, are as follows:
SuccessorPredecessor
Period from
June 7, 2025
through
April 30, 2026		Period from
May 1, 2025
through
June 6, 2025		Year Ended April 30, 2025
United States
Federal
$
— 
$
— 
$
— 
State and local
— 
— 
— 
Total United States
— 
— 
— 
Foreign
Canada
(539)
— 
285 
Cayman Islands(A)
n.a.
n.a.
n.a.
Total foreign
(539)
— 
285 
Total income taxes paid, net of refunds received
$
(539)
$
— 
$
285 
A.The Company did not pay any income taxes as its Cayman Islands subsidiary is not subject to income taxes.
Uncertain Tax Positions
At April 30, 2026 and April 30, 2025, the Company had no unrecognized tax benefits, and has recorded a $0.2 million reserve for Canadian excise taxes. The Company does not anticipate any significant change in its uncertain tax benefit balance during the twelve months following April 30, 2026.
The Company's policy is to recognize interest and penalties related to income tax matters in income tax expense. The Company has not accrued any interest or penalties related to uncertain tax positions at April 30, 2026.
Open Tax Years
The Company files income tax returns in U.S. federal, various U.S. state, and Canadian federal and provincial jurisdictions. The following tax years remain subject to examination by the relevant taxing authorities:
Open Tax Years Ended
April 30,
JurisdictionFromThrough
United States
Federal
2022
2026
State
2021
2026
Canada(A)
2022
2026
Cayman Islands(B)
n.a.
n.a.
A.Includes both federal and provincial tax years.
B.No income taxes assessed in jurisdiction.
Tax Legislation
One Big Beautiful Bill Act
On July 4, 2025, the President signed H.R. 1, the One Big Beautiful Bill Act ("OBBB Act"), into law. The OBBB Act includes several changes to U.S. federal tax law that generally allow for more favorable deductibility of certain business expenses beginning in 2025, including the restoration of immediate expensing of domestic research and experimental expenditures, reinstatement of 100.0% bonus depreciation, and more favorable rules for determining the limitation on business interest expense.
The OBBB Act also includes certain changes to the U.S. taxation of foreign activity, including changes to foreign tax credits, the global intangible low-taxed income ("GILTI") regime, the foreign-derived intangible income ("FDII") regime, and the base erosion and anti-abuse tax ("BEAT"), among other changes. These foreign-related changes are generally effective for tax years beginning after December 31, 2025.
The Company has accounted for the impact of the OBBB Act, where required, in the period of enactment. The OBBB Act did not have a material impact on the Company's consolidated financial statements for the fiscal year ended April 30, 2026, and the Company does not currently expect the OBBB Act to have a material impact on its consolidated income tax provision in future periods.