10-Q: Verde Resources Reports Q3 2026 Results, Sees Revenue Surge

Verde Resources, Inc. announced its third quarter fiscal year 2026 financial results, highlighting a significant increase in revenue driven by initial sales of its Verde V24 product.

Summary

• Verde Resources, Inc. reported its financial results for the nine months ended March 31, 2026, showing a substantial increase in revenue compared to the same period in the previous year.
• The company's revenue for the nine months ended March 31, 2026, was $466,953, a significant jump from $128,690 in the prior year, primarily due to initial commercial sales of its Verde V24 cold mix biochar asphalt emulsifying agent.
• Cost of revenue also increased to $298,314 from $59,303, reflecting higher sales volumes and procurement costs for Verde V24.
• Gross profit for the period was $168,639, up from $69,387, though gross margin percentage decreased due to product mix.
• Selling, general, and administrative expenses decreased by 35% to $2,830,308, largely due to the absence of a large CEO bonus and reduced share-based compensation, partially offset by increased legal and R&D costs.
• The company reported a net loss of $2,366,700 for the nine months ended March 31, 2026, an improvement from a net loss of $3,485,994 in the prior year.
• Cash and cash equivalents increased to $2,129,576 from $1,021,112, supported by financing activities.
• The company received $2 million in proceeds from a private placement with Ergon in October 2025 and an additional $448,000 from other private placements during the period.

Sentiment

Score: 6

Explanation: StockSavvy.ai views this filing as cautiously optimistic. While the company has achieved significant commercial milestones and revenue growth, it continues to operate at a net loss and faces ongoing risks related to scaling, financing, and market adoption.

Positives

• Revenue increased significantly by 263% to $466,953 for the nine months ended March 31, 2026, driven by initial commercial sales of Verde V24.
• Gross profit increased by 143% to $168,639 for the nine months ended March 31, 2026.
• Selling, general, and administrative expenses decreased by 35% to $2,830,308, primarily due to lower share-based compensation and the absence of a large CEO bonus.
• Net loss decreased by 32% to $2,366,700 for the nine months ended March 31, 2026.
• Cash and cash equivalents increased by approximately 109% to $2,129,576 as of March 31, 2026.
• The company secured $2 million in proceeds from a private placement with Ergon in October 2025.
• The company received its first two purchase orders from Ergon for Verde V24, generating approximately $460,000 in revenue, which was fully collected.
• NCAT laboratory testing demonstrated that the company's cold-recycled mix exceeds industry specifications for cold-recycled asphalt, showing superior cohesion, high tensile strength ratio, and retained stability.

Negatives

• Gross margin percentage decreased due to changes in product mix, with a higher proportion of Verde V24 sales having a different pricing and cost structure.
• The company continues to operate at a net loss, with a loss of $2,366,700 for the nine months ended March 31, 2026.
• The company has identified material weaknesses in its internal controls over financial reporting, including limitations in segregation of duties, need for formalization of policies, and lack of an internal audit function.
• The company's operations are subject to significant risks and uncertainties associated with early-stage operations and reliance on third parties like Ergon.
• The company anticipates needing additional funding over the next twelve months and may not be able to obtain it on favorable terms, or at all.

Risks

• The company's ability to establish and implement its business plan and generate revenues, including through its Verde Net Zero Blueprint licensing and distribution model strategy and in conjunction with key commercial partners like Ergon Asphalt & Emulsions, Inc.
• The company's expectations about the anticipated benefits of its Verde Net Zero Blueprint licensing and distribution model strategy and its relationship with Ergon.
• The expected benefits of its proprietary road construction materials, including the cold mix biochar asphalt emulsifying agent licensed to Ergon.
• The company's ability to generate and monetize carbon renewal credits utilizing its technology and products.
• The company's ability to effectively compete in its industry and execute on its business plan.
• The impact of governmental laws and regulations, and the company's ability to comply with new regulations.
• The company's ability to effectively scale its operations in North America and other regions.
• The company's ability to adequately market its products and services, and to develop additional products and product offerings.
• The company's ability to successfully expand its operations into foreign markets.
• Assumptions related to the size of the market for its products and solutions.
• The company's future capital needs and its ability to raise additional capital.
• Difficulties with certain licensees (such as Ergon), licensors, or other third parties upon which it relies.
• The company's ability to attract, develop, and retain capable key personnel.
• The company's ability to protect its intellectual property or manage threats posed by breaches of security.

Future Outlook

The company plans to generate revenue primarily through marketing and selling its proprietary road technologies via Ergon in North America, with an initial focus on the United States. Production planning has commenced, with distribution anticipated through Ergon's sales channels. The company expects to seek additional funding over the next twelve months through public and private offerings, including a potential national exchange listing and concurrent public offering. Management believes its asset-light model enables scalable growth and recurring revenue streams.

Management Comments

• Our strategic roadmap for achieving net-zero emissionswhat we call the Verde Net Zero Blueprinthas achieved the following significant milestones: The issuance to our company in April 2025 of the worlds first carbon removal credit from asphalt production and application, certified by Puro.earth.
• Technological validation of our BioAsphalt by NCAT, including receipt of preliminary performance results from NCAT in July 2025 that demonstrated consistent durability, particularly under low-volume roadway conditions.
• As the rise of artificial intelligence accelerates data center energy consumption... enterprises worldwide are facing increasing pressure to offset their carbon footprints. We believe this is driving demand for high-integrity, verifiable carbon credits.
• Our model presents a novel combination of infrastructure performance with measurable climate impact, establishing us as a first mover in scalable Net Zero solutions, which we believe positions us well to meet the demands of a rapidly decarbonizing, carbon-constrained economy.
• We believe our asset light business model enables scalable growth while minimizing capital intensity, creating recurring revenue streams through licensing, sales, royalties, carbon monetization, and strategic commercial arrangements.

Industry Context

StockSavvy.ai notes that Verde Resources is positioning itself at the intersection of sustainable infrastructure and carbon credit markets. The company's focus on biochar-enhanced asphalt and its collaboration with entities like NCAT and Puro.earth align with growing industry trends towards decarbonization and verifiable carbon removal solutions. The recent commercial transaction with Ergon is a key step in validating its business model.

Comparison to Industry Standards

• The company's claim of issuing the world's first carbon removal credit from asphalt production and application, certified by Puro.earth, sets a new benchmark in the sustainable materials sector.
• NCAT's validation of the company's cold-recycled mix exceeding industry specifications for strength, durability, and moisture resistance indicates performance parity or superiority compared to conventional cold-recycled asphalt.
• The demonstration of sequestering approximately eight tons of carbon in a single project, verified and certified under Puro.earth, highlights a significant environmental achievement in asphalt production.

Legal Proceedings

• The company is not a party to, nor is it aware of, any legal proceedings, investigations, or claims that management believes are likely to have a material adverse effect on its business, financial condition, or results of operations.

Related Party Transactions

• Amount due to related parties includes balances from Borneo Oil Corporation Sdn, Borneo Oil Berhad, Taipan International Limited, Borneo Energy Sdn Bhd, Victoria Capital Sdn Bhd, J. Ambrose & Partners, SB Resorts Sdn Bhd, SB Supplies & Logistics Sdn Bhd, and Borneo Eco Food Sdn. Bhd.
• Amount due to director Mr. Jack Wong was $3,033 as of March 31, 2026, representing expenses incurred on behalf of the company.
• The company completed the sale of property to Jack Wong for $857,500 on December 19, 2024, recognizing a gain on disposal of $161,156.
• Makin Teguh Sdn Bhd and J. Ambrose & Partners entered into debt release agreements, extinguishing outstanding obligations owed by the company.

Stakeholder Impact

• Shareholders: The company's progress in commercialization and potential Nasdaq listing could impact share value. Continued losses and need for further financing present risks.
• Employees: Management has had employment terms extended, indicating confidence in leadership continuity.
• Customers: The Ergon partnership is key for market access and product adoption.
• Suppliers: The company has secured a supply agreement with Biochar Solutions LLC for engineered biochar.
• Creditors: The company has settled certain debts and has no material contingencies as of March 31, 2026.

Next Steps

• Continue commercialization of Verde V24 through Ergon in North America.
• Seek additional funding through public and private offerings.
• Pursue a national exchange listing of common stock.
• Expand licensing of the Verde Net Zero Blueprint globally.
• Continue technology development and validation, including the NCAT project and LCA with WAP Sustainability.

Key Dates

Recommendation

Verde Resources has shown promising progress with its first commercial sales and technological validations. However, the company remains in an early stage, continues to incur losses, and relies heavily on future financing and market adoption. While the potential for growth in the sustainable materials and carbon credit markets is significant, the inherent risks warrant a 'hold' recommendation until more consistent profitability and reduced financial risk are demonstrated.

Keywords

Verde Resources, Form 10-Q, Quarterly Report, BioAsphalt, Biochar, Carbon Removal Credits, NCAT, Puro.earth, Ergon, Sustainable Infrastructure, Net Zero, SEC Filing