DESTINY MEDIA TECHNOLOGIES INC
For the period ended May 31, 2025. Filed Jul 14, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
May 31, 2025 · Filed Jul 14, 2025
DSNYStored price and day change unavailable
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-02-28; filed 2025-04-14.
0001062993-25-007398
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-05-31; filed 2025-07-14.
0001062993-25-012768
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 127 previous paragraphs and 128 current paragraphs.
91 unchanged; 24 reworded; 11 added; 8 removed; 4 previous and 2 current paragraphs rearranged.
Tables are not compared: 12 previous and 12 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (11)
Current report
Telecommunication expenses contributed to a 1.6% increase in total costs, primarily driven by infrastructure requirements related to the launch of the MTR™ product.
Current report
A non-recuring recruitment fee that contributed with a 3.2% increase in total costs for the quarter.
Current report
General and administrative expenses increased primarily due to a one recruitment fee and the impact of foreign currency revaluation on accounts receivable and other monetary balances.
Current report
Depreciation and amortization expense increased to $190,425 for the three months ended May 31, 2025, from $87,760 for the three months ended May 31, 2024, an increase of 117.0%. This increase was due to the depreciation of newly enhanced features in the Play MPE® Player and Caster computer software applications and the launch of a new product MTR.
Current report
Total revenue for the nine months ended May 31, 2025 was $3,379,692 compared to the revenue of $3,296,582 for the nine months ended May 31, 2024, an increase of 2.5% period over period that was driven mostly by our Major Label customers. After adjusting for foreign exchange rates, the Company's revenue for the nine-month period grew by 2.8%.
Current report
Gross margin for the nine months ended May 31, 2025 was 86.2% of revenue, compared to 86.4% for the same period in 2024, reflecting overall margin stability year-over-year. The slight decrease was primarily due to infrastructure investments related to the build-out of the MTR™ business, which impacted margins in the most recent quarter.
Current report
Due to the capitalization of salaries and wages in previous periods, depreciation of computer software increased in the nine-month period, resulting in a 10.8% rise in total operating expenses.
Current report
Telecommunication expenses contributed to a 2.0% increase in total costs, primarily driven by infrastructure requirements related to the launch of the MTR™ product.
Current report
The above increases were partially offset by a reduction in overall staffing, as the Company prioritized increased productivity and operational efficiency.
Current report
Depreciation and amortization expense increased to $541,128 for the nine months ended May 31, 2025 from $255,884 for the nine months ended May 31, 2024, an increase of 111.5%. This increase was due to the depreciation of recently capitalized additions in the Play MPE® Player and Caster computer software applications.
Removed paragraphs (8)
Previous report
A reduction in salaries and wages reducing overall expenditures by 12.7%. This reduction is a mixture of temporary and on-going cost reductions as we adjust staffing in development and sales and marketing.
Previous report
Product development salaries and wages declined due to a reduction in overall staffing, as the Company prioritized increased productivity and operational efficiency. These costs were offset by increases in investments in infrastructure.
Previous report
Depreciation and amortization expense increased to $183,724 for the three months ended February 28, 2025 from $87,026 for the three months ended February 29, 2024, an increase of 111.1% due to depreciation of additionally capitalized software development costs associated with Play MPE® recipient player applications during the period.
Previous report
RESULTS OF OPERATIONS FOR SIX MONTHS ENDED FEBRUARY 28, 2025 AND FEBRUARY 29, 2024
Previous report
Total revenue for the six months ended February 28, 2025 was $2,245,729 compared to the revenue of $2,141,140 for the six months ended February 29, 2024, an increase of 4.9% period over period.
Previous report
A reduction in salaries and wages reducing overall expenditures by 1.0%.
Previous report
Depreciation and amortization expense increased to $350,703 for the six months ended February 28, 2025 from $168,124 for the six months ended February 29, 2024, an increase of 108.6% due to depreciation of additionally capitalized software development costs associated with Play MPE® recipient player applications during the period.
Previous report
Net Income (Loss)
Reworded paragraphs (24)
Previous wording
In this report, "we," "us," "our," "our company", "Destiny" and similar references refer to Destiny Media Technologies, Inc., a Nevada corporation, and its wholly-owned subsidiaries: Destiny Software Productions, Inc. ("DSNY"), MPE Distributions, Inc. ("MPE"), Tonality, Inc. ("Tonality"), and Sonox Digital Inc. ("Sonox"), and (ii) the term "common stock" refers to the common stock, par value $0.001 per share, of Destiny Media Technologies, Inc., a Nevada corporation. The financial information included herein is presented in United States dollars unless otherwise indicated.
Current wording
In this report, "we," "us," "our," "our company", "Destiny" and similar references refer to Destiny Media Technologies Inc., a Nevada corporation, and its wholly-owned subsidiaries: Destiny Software Productions, Inc. ("DSPI"), MPE Distributions, Inc. ("MPE"), Tonality, Inc. ("Tonality"), and Sonox Digital Inc. ("Sonox"), and (ii) the term "common stock" refers to the common stock, par value $0.001 per share, of Destiny Media Technologies, Inc., a Nevada corporation. The financial information included herein is presented in United States dollars unless otherwise indicated.
Previous wording
Our common stock trades on TSX Venture Exchange in Canada under the symbol "DSY", on the OTCQB U.S. ("OTCQB") under the symbol "DSNY", and on various German exchanges (Frankfurt, Berlin, Stuttgart and Xetra) under the symbol "DME1.F".
Current wording
Our common stock trades on TSX Venture Exchange in Canada under the symbol "DSY.V", on the OTCQB U.S. ("OTCQB") under the symbol "DSNY", and on various German exchanges (Frankfurt, Berlin, Stuttgart and Xetra) under the symbol "DME1.F".
Previous wording
Our corporate website is located athttp://www.dsny.com.
Current wording
Our corporate website is located athttps://investors.dsny.com/
Previous wording
MTR™ (or "Music Tracking Radar" or "Meter"https://www.plaympe.com/track/) is a digital tracking service that tracks and reports the number and times an individual track is played. MTR™ uses a proprietary algorithm to uniquely identify and match a track. The Company launched MTR™ in beta in fourth quarter of 2023. During the beta phase of this new product, the Company will test monitoring uptime, customer acquisition activities and add functionality for sale at scale. The beta version of the platform will initially monitor digital broadcasts of 800 stations in Canada.
Current wording
MTR™ (or "Music Tracking Radar" or "Meter"https://www.plaympe.com/track/) is a digital tracking service that tracks and reports the number and times an individual track is played. MTR™ uses a proprietary algorithm to uniquely identify and match a track. The Company launched MTR™ in fourth quarter of the prior year. The Company is adding functionality for sale at scale and for users with larger data requirements that have larger repertoires of music.
Previous wording
Total revenue for the three months ended February 28, 2025 was $1,018,972 compared to the revenue of $986,338 for the three months ended February 29, 2024, an increase of 3.3% period over period. Total revenue for the six months ended February 28, 2025 was $2,245,729 compared to the revenue of $2,141,140 for the six months ended February 29, 2024, an increase of 4.9% period over period. Revenue from MTR™ continues to grow throughout the year and the quarter and management expects to continue to build on this service with features to accommodate larger use clients later in the fiscal year.
Current wording
Total revenue for the three months ended May 31, 2025 was $1,133,963 compared to the revenue of $1,155,442 for the three months ended May 31, 2024, a decrease of 1.9% period over period. Total revenue for the nine months ended May 31, 2025 was $3,379,692 compared to the revenue of $3,296,582 for the nine months ended May 31, 2024, an increase of 2.5% period over period. The decline in total revenue for the three month period is the result of a small reduction in independent label revenue in Australia and the United States from a reduction in average purchase size. There was also a reduction in new customer acquisition when compared to the comparative period as a result of temporary staffing reductions in the current period. These impacts are believed to be temporary cyclical changes and are temporary in nature. While currently still immaterial, revenue from MTR™ continued to grow throughout the year and the quarter and management expects to continue to build on this service with features to accommodate larger use clients later in the fiscal year.
Previous wording
Gross margin for the three months ended February 28, 2025 was 85.3% of revenue, compared to 86.3% for the three months ended February 29, 2024. The Company's cost of revenue consists of data hosting and processing charges, third party transaction related costs, and engineering, technical and customer support costs. These costs are driven by the size and volume of customer transactions processed, as well as the relative proportion of "full-service" versus "self-service" revenue. Our self-service sales are derived from customers who have been provided with a customer account to access our encoder to independently upload and publish releases. Our full-service revenue is derived from customers who are fully serviced by our internal staff, who prepare and publish releases on their behalf. During the three months ended February 28, 2025, our gross margin decreased compared to the same period last year. This decrease in gross margin is caused by infrastructure required to build out the MTR™ business.
Current wording
Gross margin for the three months ended May 31, 2025 was 85.7% of revenue, compared to 87.0% for the three months ended May 31, 2024. The Company's cost of revenue consists of data hosting and processing charges, third party transaction related costs, and engineering, technical and customer support costs. These costs are driven by the size and volume of customer transactions processed, as well as the relative proportion of "full-service" versus "self-service" revenue. Our self-service sales are derived from customers who have been provided with a customer account to access our encoder to independently upload and publish releases. Our full-service revenue is derived from customers who are fully serviced by our internal staff, who prepare and publish releases on their behalf. During the three months ended May 31, 2025, our gross margin decreased compared to the same period last year. This decrease in gross margin is caused by infrastructure required to build out the MTR™ business.
Previous wording
Operating costs during the three months ended February 28, 2025 increased by 18.2% to $1,178,272 (February 29, 2024 - $996,465). The increase in operating costs was primarily the result of the following:
Current wording
Operating costs during the three months ended May 31, 2025 increased by 18.6% to $1,049,348 (May 31, 2024 - $884,607). The increase in operating costs was primarily the result of the following:
Previous wording
A non-cash increase in amortization costs that grew overall costs by 9.7%.
Current wording
A non-cash increase in amortization costs that grew overall costs by 11.6%.
Previous wording
For ease of reference the following table has been prepared to present operating results had the Company not capitalized software for the three months ended February 28, 2025 and February 29, 2024.
Current wording
For ease of reference the following table has been prepared to present operating results had the Company not capitalized software development salaries for the three months ended May 31, 2025 and 2024.
Previous wording
Product development costs increased as a result of a lower capitalization rate associated with software development. This increase is partially offset by a reduction in overall staffing, as the Company prioritized increased productivity and operational efficiency.
Current wording
Product development costs increased as a result of a lower capitalization rate associated with software development. This increase is partially offset by a reduction in overall staffing, as the Company prioritized increased productivity and operational efficiency. In addition, telecommunication expenses increased as a result of infrastructure investments related to the development of the MTR™ business.
Previous wording
Interest income earned on the Company's investments was $6,493 for the three months ended February 28, 2025 (February 29, 2024 - $15,461).
Current wording
Interest income earned on the Company's mutual funds was $4,969 for the three months ended May 31, 2025 (May 31, 2024 - $13,685).
Previous wording
Operating costs during the six months ended February 28, 2025 increased by 22.2% to $2,139,182 ( February 29, 2024 - $1,749,859). This rise can be primarily attributed to the following factors:
Current wording
Operating costs during the nine months ended May 31, 2025 increased by 21.0% to $3,188,530 (May 31, 2024 - $2,634,466). This rise can be primarily attributed to the following factors:
Previous wording
A one-time, non-repeating cost associated with litigation increasing total costs by 23.4%. This litigation is currently awaiting adjudication and the Company is confident in a positive outcome.
Current wording
A one-time, non-repeating cost associated with litigation increasing total costs by 9.4%. This litigation is currently awaiting adjudication and the Company is confident in a positive outcome.
Previous wording
For ease of reference the following table has been prepared to present operating results had the Company not capitalized software for the six months ended February 28, 2025 and February 29, 2024.
Current wording
For ease of reference the following table has been prepared to present operating results had the Company not capitalized software development salaries for the nine months ended May 31, 2025 and 2024.
Previous wording
General and administrative expenses remained consistent with expectations, with a notable increase in professional fees. This increase is due to litigation-related costs. These costs represent the final stages of this litigation, and the Company expects a successful outcome. The Company also expects a cost award that will offset a portion of these expenses.
Current wording
General and administrative expenses remained consistent with expectations, with a notable increase in professional fees. This increase is due to litigation-related costs. These costs represent the final stages of this litigation, and the Company expects a successful outcome. The Company also expects a cost award that will offset a portion of these expenses. The increase in wages and benefits is primarily due to a one time recruitment fee.
Previous wording
Interest income earned on the Company's investments was $14,901 for the six months ended February 28, 2025 (February 29, 2024 - $26,987).
Current wording
Interest income earned on the Company's mutual funds was $19,870 for the nine months ended May 31, 2025 (May 31, 2024 - $40,672).
Previous wording
During the three and six months ended February 28, 2025 the Company reported a net loss of $302,094 and net loss of $183,954, respectively (February 29, 2024 - net loss of $130,012 and net income of $119,504, respectively).
Current wording
During the three and nine months ended May 31, 2025 the Company reported a net loss of $72,288 and $256,242, respectively (May 31, 2024 - a net income $134,476 and $253,980, respectively).
Previous wording
For the three and six months ended February 28, 2025, adjusted EBITDA was $(116,719) and $170,751, respectively (February 29, 2024 - $(47,792) and $285,101, respectively). Adjusted EBITDA is not defined under U.S. GAAP, and it may not be comparable to similarly titled measures reported by other companies. We used Adjusted EBITDA, along with other GAAP measures, as a measure of our profitability because Adjusted EBITDA helps us to compare our performance on a consistent basis by removing from our operating results the impact of our capital structure, the effect of operating in different tax jurisdictions, the impact of our asset base, which can differ depending on the book value of assets, the accounting methods used to compute depreciation and amortization, the existence or timing of asset impairments and the effect of non-cash stock-based compensation expense.
Current wording
For the three and nine months ended May 31, 2025, adjusted EBITDA was $122,097 and $292,848, respectively (May 31, 2024 - $219,910 and $505,011, respectively). Adjusted EBITDA is not defined under U.S. GAAP, and it may not be comparable to similarly titled measures reported by other companies. We used Adjusted EBITDA, along with other GAAP measures, as a measure of our profitability because Adjusted EBITDA helps us to compare our performance on a consistent basis by removing from our operating results the impact of our capital structure, the effect of operating in different tax jurisdictions, the impact of our asset base, which can differ depending on the book value of assets, the accounting methods used to compute depreciation and amortization, the existence or timing of asset impairments and the effect of non-cash stock-based compensation expense.
Previous wording
As at February 28, 2025, we held $1,216,378 (August 31, 2024 - $1,481,582) in cash and cash equivalents. The Company's cash equivalents consist of investments in mutual funds with a major Canadian financial institution that earn interest at variable interest rates.
Current wording
As at May 31, 2025, we held $1,261,706 (August 31, 2024 - $1,481,582) in cash and cash equivalents. The Company's cash equivalents consist of investments in mutual funds with a major Canadian financial institution that earn interest at variable interest rates.
Previous wording
At February 28, 2025, we had working capital of $1,687,699 compared to $1,842,071 as at August 31, 2024. The decrease in our working capital was primarily due to operating results.
Current wording
At May 31, 2025, we had working capital of $1,792,154 compared to $1,842,071 as at August 31, 2024. The decrease in our working capital was primarily due to operating results.
Previous wording
Net cash provided by operating activities during the six months ended February 28, 2025 was $47,646 (February 29, 2024 – $132,797). The primary reason for the decrease in cash flows from operating activities is related to the timing of receipts of refundable taxes.
Current wording
Net cash provided by operating activities during the nine months ended May 31, 2025 was $138,911 (May 31, 2024 - $291,047). The primary reason for the decrease in cash flows from operating activities is related to the timing of receipts of refundable taxes.
Previous wording
Net cash used in investing activities for the six months ended February 28, 2025 was $223,440, compared to cash used in investing activities of $281,563 for the six months ended February 29, 2024. The period-over-period decrease was mainly driven by the lower proportion of software development salaries and wages capitalized in the current period.
Current wording
Net cash used in investing activities for the nine months ended May 31, 2025 was $314,225, compared to cash used in investing activities of $422,965 for the nine months ended May 31, 2024. The period-over-period decrease was mainly driven by the lower proportion of software development salaries and wages capitalized in the current period.
Previous wording
Net cash used in financing activity during the six months ended February 28, 2025 was nil (February 29, 2024 - $306,680). In the prior year, this cash was used to repurchase and retire 309,300 shares of common stock of the Company under the Normal Course Issuer Bid ("NCIB").
Current wording
Net cash used in financing activity during the nine months ended May 31, 2025 was nil (May 31, 2024 - $470,271). In the prior year, this cash was used to repurchase and retire 459,200 shares of common stock of the Company under the Normal Course Issuer Bid ("NCIB").
Previous wording
For a description of our critical accounting policies, see the sections entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies and Significant Judgements and Estimates" and "Financial Statements and Supplementary Data - Note 2, Summary of Significant Accounting Policies" contained in our 2024 Form 10-K. There have not been any material changes to the critical accounting policies discussed therein during the three and six months ended February 28, 2025.
Current wording
For a description of our critical accounting policies, see the sections entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies and Significant Judgements and Estimates" and "Financial Statements and Supplementary Data - Note 2, Summary of Significant Accounting Policies" contained in our 2024 Form 10-K. There have not been any material changes to the critical accounting policies discussed therein during the three and nine months ended May 31, 2025.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
RESULTS OF OPERATIONS FOR THE NINE MONTHS ENDED MAY 31, 2025 AND 2024
Current report — wording carried from elsewhere
Product development costs increased as a result of a lower capitalization rate associated with software development. This increase is partially offset by a reduction in overall staffing, as the Company prioritized increased productivity and operational efficiency. In addition, telecommunication expenses increased as a result of infrastructure investments related to the development of the MTR™ business.
Rearranged previous paragraphs (4)
Previous report — wording carried elsewhere
Gross margin for the six months ended February 28, 2025 was 86.4% of revenue, compared to 86.0% for the six months ended February 29, 2024. The Company's cost of revenue consists of data hosting and processing charges, third party transaction related costs, and engineering, technical and customer support costs. These costs are driven by the size and volume of customer transactions processed, as well as the relative proportion of "full-service" versus "self-service" revenue. Our self-service sales are derived from customers who have been provided with a customer account to access our encoder to independently upload and publish releases. Our full-service revenue is derived from customers who are fully serviced by our internal staff, who prepare and publish releases on their behalf.
Previous report — wording carried elsewhere
A one-time, non-repeating cost associated with litigation increasing total costs by 14.2%. This litigation is currently awaiting adjudication and the Company is confident in a positive outcome.
Previous report — wording carried elsewhere
A non-cash increase in amortization costs that grew overall costs by 10.4%.
Previous report — wording carried elsewhere
General and administrative expenses remained consistent with expectations, with a notable increase in professional fees. This increase is due to litigation-related costs. These costs represent the final stages of this litigation, and the Company expects a successful outcome. The Company also expects a cost award that will offset a portion of these expenses.