DESTINY MEDIA TECHNOLOGIES INC

Previous 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".

Current 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".

Previous wording

Our corporate website is located athttps://investors.dsny.com/

Current wording

Our corporate website is located athttp://www.dsny.com.

Previous wording

Currently, the Company's core business is the Play MPE® online platform. Play MPE® distributes promotional content (broadcast quality audio, video, images, promotional information, metadata and other digital content) from record labels and artists to broadcasting professionals, music curators and music reviewers to discover, download, broadcast and review the content. Curators include radio programmers, digital streaming broadcasters, media reviewers, industry VIP's, DJ's, film and TV personnel, sports stadiums, retailers etc. In providing the distribution, Play MPE® provides several capabilities developed and designed to address the unique needs of both music promoters and broadcasters. Play MPE® was first to market and is the largest provider of this service and provides the most feature rich platform in the world.

Current wording

The Company's core business is the Play MPE® online platform. Play MPE® distributes music for promotional purposes (broadcast quality audio, video, images, promotional information, metadata and other digital content) from record labels and artists to broadcasting professionals, music curators and music reviewers to discover, download, review and broadcast. Curators include radio programmers, digital streaming broadcasters, media reviewers (newspapers, magazines etc.), industry VIP's, DJ's, film and TV personnel, sports stadiums, retailers etc. In providing the distribution, Play MPE® provides several capabilities developed and designed to address the unique needs of both music promoters and broadcasters. Play MPE® was first to market and is the largest provider of this service and provides the most feature rich platform in the world.

Previous wording

Record labels and artists are Play MPE®'s customers. When adding music to the Play MPE® system, clients are targeting specific industry recipients who review and broadcast their music. Play MPE®'s primary value proposition in this marketing effort is a direct increase to record label and artist revenue through on-air broadcast royalties, streaming royalties and synchronization revenue (revenue collected when a song is placed within video advertisements, television, or film), and indirect increases in revenue through growing song and artists' popularity.

Current wording

Record labels and artists are Play MPE®'s customers. When adding music to the Play MPE® system, clients are targeting specific industry recipients who review and broadcast their music. Play MPE®'s primary value proposition in this marketing effort is a direct increase to record label and artist revenue through on-air broadcast royalties and indirect increases in revenue through growing song and artists' popularity.

Previous wording

Also, Play MPE® provides numerous capabilities that dramatically reduce record label costs while providing functionality necessary for certain strategic marketing plans. The platform also provides administrative controls to enhance security for record label content. In doing so, Play MPE® satisfies a broad range of stakeholders representing diverse interests at record labels. Music is protected by Play MPE®'s patented proprietary watermarking system which provides watermarks unique to each recipient.

Current wording

Play MPE® provides numerous capabilities that improve record label efficiencies and the effectiveness of their promotional campaigns. The platform also provides administrative controls to enhance security for record label content. In doing so, Play MPE® satisfies a broad range of stakeholders representing diverse interests at record labels. Music is protected by Play MPE®'s patented proprietary watermarking system which provides watermarks unique to each recipient.

Previous wording

Play MPE®'s cloud-based Caster software includes local distribution functions that provide capabilities for a client to create and schedule release announcements and select its targeted audience. Play MPE® is designed uniquely to suit music marketing plans and its significant components include:

Current wording

Caster is designed uniquely to suit music marketing plans and its significant components include:

Previous wording

Assets Management allows users to maintain and manage a repository of assets (single or multitrack releases) outside of the release creation process. This functionality saves users time when creating new releases and allows them to plan for future releases more efficiently. Assets Management also supports Quickshare, a newly designed 1:1 secure file sharing function (see below).

Current wording

Assets Management allows users to maintain and manage a repository of assets (single or multitrack releases) outside of the release creation process. This functionality saves users time when creating new releases and allows them to plan for future releases more efficiently. Assets Management also supports Quickshare, a secure one-to-one file sharing function.

Previous wording

Caster consistently receives high reviews on the platform's ease of use, capabilities and on its ultimate effectiveness. Public reviews can be found athttps://www.plaympe.com/testimonials/.

Current wording

Public reviews can be found athttps://www.plaympe.com/testimonials/.

Previous wording

Play MPE® actively manages curated and targeted distribution lists or "packages". List creation and list maintenance involve several proprietary processes that are designed to create complete, active, accurate, and targeted lists to facilitate efficient marketing campaigns. Play MPE® provides more than 400 unique targeted lists comprising of more than 17,000 unique and active recipients over 30 countries. To facilitate targeted music marketing campaigns, these lists are grouped by territory (typically by country), by genre of music, and by recipient type (see recipient player discussion). Relying on proprietary technical innovations and processes, these recipient lists are updated in real time. With an annual churn averaging between 27-34%, these recipient lists would quickly become inaccurate absent Play MPE®'s active curation. Play MPE® regularly monitors activity levels and recipients through proprietary analytics. Play MPE® provides the widest and most accurate distribution channels available in the industry.

Current wording

Play MPE® actively manages curated and targeted distribution lists or "packages". List creation and list maintenance involve several proprietary processes that are designed to create complete, active, accurate, and targeted lists to facilitate efficient marketing campaigns. Play MPE® provides more than 400 unique targeted lists comprising of more than 17,000 unique and active recipients over 60 countries. To facilitate targeted music marketing campaigns, these lists are grouped by territory (typically by country), by genre of music, and by recipient type (see recipient player discussion). Relying on proprietary technical innovations and processes, these recipient lists are updated in real time. With an annual churn averaging between 27-34%, these recipient lists would quickly become inaccurate absent Play MPE®'s active curation. Play MPE® regularly monitors activity levels and recipients through proprietary analytics. Play MPE® provides the widest and most accurate distribution channels available in the industry.

Previous wording

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 wording

Total revenue for the three months ended November 30, 2025 was $1,243,139 compared to the revenue of $1,226,757 for the three months ended November 30, 2024, an increase of 1.3% period over period. After adjusting for foreign exchange rates, the Company's revenue for the three-month period grew by 1.6%.

Previous 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:

Current wording

Operating costs during the three months ended November 30, 2025 increased by 2.3% to $983,349 (November 30, 2024 - $960,910). The increase in operating costs was primarily the result of the following:

Previous wording

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 wording

Due to capitalization of salaries and wages in previous periods, depreciation of computer software increased in the current period and resulted in a 0.6% increase in total operating expenses.

Previous 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.

Current 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 November 30, 2025 and 2024.

Previous wording

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.

Current wording

Depreciation and amortization expense increased to $172,485 for the three months ended November 30, 2025 from $166,979 for the three months ended November 30, 2024, an increase of 3.3% due to depreciation of additionally capitalized software development costs during the last year.

Previous 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).

Current wording

Interest income earned on the Company's mutual funds was $4,926 for the three months ended November 30, 2025 (November 30, 2024 - $8,408).

Previous 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).

Current wording

During the three months ended November 30, 2025 the Company reported a net income of $83,652 (November 30, 2024 - $118,140).

Previous 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.

Current wording

For the three months ended November 30, 2025, adjusted EBITDA was $252,544 (November 30, 2024 - $287,470). 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 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.

Current wording

As at November 30, 2025, we held $1,362,500 (August 31, 2025 - $1,117,889) in cash and cash equivalents. The Company's cash equivalents consist of investments in mutual funds with a major Canadian financial institution earns an average interest of 2.23%.

Previous 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.

Current wording

At November 30, 2025, we had working capital of $1,831,647 compared to $1,634,587 as at August 31, 2025. The decrease in our working capital was primarily due to operating results.

Previous wording

The following table sets forth a summary of the net cash flow activity for the periods indicated:

Current wording

The following table sets forth a summary of the net cash flow activity for each of the periods indicated:

Previous 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.

Current wording

Net cash provided by operating activities during the three months ended November 30, 2025 was $298,600 (November 30, 2023 - $217,619). The primary reason for the increase in cash flows from operating activities is related to the timing of receipts from our customers and the timing of payments to our vendors.

Previous 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.

Current wording

Net cash used in investing activities for the three months ended November 30, 202 was $30,127, compared to cash used by investing activities of $96,980 for the three months ended November 30, 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 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").

Current wording

Net cash used in financing activities during the three months ended November 30, 2025 was $nil (November 30, 2024 - $nil).

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 nine months ended May 31, 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 2025 Form 10-K. There have not been any material changes to the critical accounting policies discussed therein during the three months ended November 30, 2025.