10-Q: Tribal Rides Pivots to Food Tech, Reports Q1 Profit Amid Asset Sale

Tribal Rides International Corp. reported a net income of $139,664 for Q1 2025, driven by a one-time gain from related party debt extinguishment, as it fully divests its ridesharing technology and pivots to the food technology sector.

Summary

• Reported a net income of $139,664 for the three months ended March 31, 2025, compared to a net loss of $41,831 for the same period in 2024.
• The net income was primarily due to a $174,350 gain on the write-off of related party payables.
• Operating expenses decreased to $18,605 in Q1 2025 from $38,900 in Q1 2024.
• Completed the sale of substantially all intellectual property and related intangible assets of its historical transportation technology business to Boumarang Inc. on December 31, 2024, for 2,906,977 shares of Boumarang common stock, valued at $5,000,000.
• The company is strategically transitioning to pursue opportunities in the food technology (food tech) sector.
• Acquired all membership interests of Supa Food Services LLC on June 30, 2025, marking a concrete step in the food tech pivot.
• Terminated a Share Exchange Agreement with Singta Industries Inc. on June 30, 2025, as closing conditions were not satisfied.
• Had no cash on hand as of March 31, 2025, and December 31, 2024.
• Reported an accumulated deficit of $2,659,490 and a working capital deficit of $654,337 as of March 31, 2025.
• Issued 300,000 shares of common stock to certain related parties (Joseph Grimes, Sanjay Prasad, Steven Ritacco) on January 28, 2025, as compensation for services from 2020-2024.
• Changed its independent registered public accounting firm from Olayinka Oyebola & Co. to Lao Professionals on June 2, 2025.

Sentiment

Score: 4

Explanation: While the company reported a net income due to a one-time gain and has a clear strategic pivot, it faces significant challenges including no cash, a substantial accumulated deficit, a going concern warning, and the need for significant capital raises for its new venture. The strategic shift is positive, but the execution risk and current financial state are considerable.

Positives

• Reported a net income of $139,664 for Q1 2025, a significant improvement from a net loss of $41,831 in Q1 2024.
• Achieved a $174,350 gain on the extinguishment of related party payables, contributing to the Q1 2025 net income.
• Successfully divested its historical transportation technology business for $5,000,000 in Boumarang common stock, providing a strategic asset for future liquidity.
• Operating expenses decreased by over 50% to $18,605 in Q1 2025 from $38,900 in Q1 2024, indicating cost reduction efforts.
• Completed the acquisition of Supa Food Services LLC on June 30, 2025, marking a concrete step in its strategic pivot to the food technology sector.

Negatives

• Had no cash on hand as of March 31, 2025, and December 31, 2024.
• Reported an accumulated deficit of $2,659,490 as of March 31, 2025.
• Maintained a working capital deficit of $654,337 as of March 31, 2025.
• Generated no revenues in Q1 2025 or Q1 2024, indicating the company remains in a pre-commercialization phase for its new business.
• Independent auditors included an explanatory paragraph expressing substantial doubt about the company's ability to continue as a going concern.
• Identified a material weakness in internal control over financial reporting as of March 31, 2023, which was not effective.
• Faces a disputed claim from SRAX for 6,524,441 shares of common stock under share adjustment provisions.
• Notes payable totaled $368,225 and accrued interest was $165,077 as of March 31, 2025.
• A convertible promissory note is accruing default interest at 20% per annum since May 23, 2023.
• The 10% Promissory Note (Corrigan) has been in default since January 26, 2023.

Risks

• The company's continuation as a going concern is dependent upon its ability to raise equity or debt financing and attain profitable operations from any future business it may acquire, with no assurances of success.
• The company has no cash on hand and a working capital deficit, indicating significant liquidity risk and potential inability to meet working capital needs.
• Future operations depend on the ability to raise additional capital, complete acquisitions, and successfully launch products or services in the food tech space, with no specific agreements for new funding sources.
• The strategic transition to the food technology sector involves inherent operational risks related to identifying, developing, and acquiring new businesses and assets in an unfamiliar market.
• The value of the investment in Boumarang Shares is subject to market risk and volatility, as well as risks associated with Boumarang's operations and financial condition.
• A material weakness in internal control over financial reporting as of March 31, 2023, could adversely affect the company's ability to record, process, summarize, and report financial information reliably.
• A disputed claim from SRAX for 6,524,441 shares of common stock could result in significant share dilution or a substantial financial obligation.
• The 10% Promissory Note (Corrigan) is in default, and the Convertible Promissory Note (AJB Notes) is accruing default interest at 20% per annum, increasing the company's financial burden and potential for further default.

Future Outlook

The company intends to realign its corporate strategy and resources to focus on identifying, developing, and acquiring food technology businesses and assets, believing this industry presents significant opportunities. It is currently evaluating strategic partnerships, acquisitions, and product initiatives within this sector. Until this transition is complete, the company will be considered in the development stage with no current operating revenues. Future operations are dependent on its ability to raise additional capital, complete acquisitions, and successfully launch products or services in the food tech space. Management anticipates raising significant additional capital over the next twelve months, seeking funding through private equity or public markets.

Management Comments

• "We intend to realign our corporate strategy and resources to focus on identifying, developing, and acquiring food technology businesses and assets."
• "We believe the food tech industry presents significant opportunities driven by global demand for healthier, more sustainable, and technology-enabled food solutions."
• "The Company is currently evaluating strategic partnerships, acquisitions, and product initiatives within this sector."
• "Management anticipates raising significant additional capital to accomplish its growth plan over twelve (12) months."
• "We do not have any plans or specific agreements for new funding sources. The Management expects to seek additional funding through private equity or public markets."

Industry Context

The company is undergoing a complete strategic pivot from the ridesharing and autonomous vehicle technology sector to the food technology (food tech) sector. This move aligns with broader industry trends towards sustainable and technology-enabled food solutions, a growing market. The divestiture of its previous intellectual property and the acquisition of Supa Food Services LLC indicate a concrete shift, positioning the company to compete in a new, potentially high-growth industry. However, it also means starting anew in a competitive landscape without established revenue or market presence in the new sector.

Comparison to Industry Standards

• The filing does not provide specific comparable companies, projects, or results within the food technology sector to benchmark against.
• The company is in a pre-revenue, development stage for its new business direction, making direct comparisons difficult.
• Its financial metrics, including no cash, an accumulated deficit, and a going concern warning, are typical of early-stage companies or those undergoing significant restructuring, but without specific industry benchmarks, it is challenging to assess its relative standing.

Management Changes

Corporate Governance

Legal Proceedings

• The company has a disputed claim from SRAX, Inc. for 6,524,441 shares of common stock under share adjustment provisions. The company is seeking additional information to assess its validity.

Related Party Transactions

• Amounts owed to related parties decreased from $213,350 at December 31, 2024, to $39,000 at March 31, 2025.
• In February 2025, the company entered into a Release and Settlement Agreement with Joseph Grimes, Sanjay Prasad, and Sanjay Prasad, mutually releasing claims valued at $174,350, which resulted in a gain on write-offs.
• Issued 300,000 shares of common stock to Joseph Grimes (100,000), Sanjay Prasad (100,000), and Steven Ritacco (100,000) on January 28, 2025, as additional compensation for service from 2020-2024. Mr. Prasad's issuance also settled $6,427 in expenses.
• Amounts due to related parties (Joe Grimes, Sanjay Prasad, Don Smith, KeptPrivate.com) bear no interest, are unsecured, and repayable on demand.

Stakeholder Impact

• **Shareholders**: Face potential significant dilution from future capital raises needed to fund the new food tech venture. The strategic pivot introduces new risks and opportunities, with the one-time gain being positive but underlying financial health remaining weak. The termination of the Singta agreement and acquisition of Supa Food Services significantly alters the company's future business direction.
• **Employees**: Significant management changes indicate a new strategic direction and potential restructuring within the company.
• **Creditors**: The convertible promissory note is accruing default interest, and another promissory note is in default, increasing credit risk. The related party debt extinguishment is positive for the company's balance sheet.
• **Customers (future)**: The pivot to food tech means a completely new customer base and market focus, requiring the company to build new market presence and product offerings.

Next Steps

• Raise additional capital through equity or debt financing to support its new business direction.
• Identify, develop, and acquire food technology businesses and assets.
• Evaluate strategic partnerships, acquisitions, and product initiatives within the food tech sector.
• Successfully launch products or services in the food tech space.
• Announce the acquisition of Supa Food Services LLC in a Current Report on Form 8-K on or before September 30, 2025, including required financial statements and pro forma information.
• Address the material weakness in internal control over financial reporting.
• Resolve the disputed claim from SRAX regarding share adjustments.
• Negotiate repayment or extension for the defaulted 10% Promissory Note (Corrigan).

Key Dates

Recommendation

The company is undergoing a significant strategic transformation, divesting its old business and acquiring a new one in the food technology sector. While the reported net income for Q1 2025 is positive, it is primarily due to a non-recurring gain from debt extinguishment, and the company still faces substantial financial challenges, including no cash, an accumulated deficit, and a going concern warning. The new direction in food tech presents potential long-term opportunities, but the execution risk is high, and the need for significant future capital raises will likely lead to dilution. Investors should hold to observe the successful integration of the new acquisition, the development of a viable business model in the food tech space, and the company's ability to secure necessary funding without excessive dilution. A 'buy' would be premature given the early stage of the new venture and financial instability, while a 'sell' might forgo potential upside if the strategic pivot proves successful.

Keywords

Food Technology, Food Tech, Strategic Pivot, Asset Sale, Boumarang Inc., Supa Food Services, SEC Filing, 10-Q, Quarterly Report, Financial Results, Going Concern, Capital Raise, Management Changes, Corporate Governance, Liquidity, Accumulated Deficit, Related Party Transactions, Convertible Notes, Internal Controls, Auditor Change, Ridesharing Technology