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WINDSOR, Ont., Canada – NEXE Innovations Inc., a compostable and innovative materials company, is pleased to announce its financial results for the three-month period ended August 31, 2025 (“Q1 2026”). The Company reported revenue growth, a positive gross margin, maintained a strong balance sheet, and achieved a major third-party Food Safety Audit milestone which we believe reflects progress in operational compliance and commercial readiness.
Q1 2026 Results:
- Revenue Growth: Revenue increased to $120,484, compared to $3,147 in Q1 2025, reflecting continued adoption of NEXE’s next-generation compostable coffee pod launched in late 2024.
- Positive Gross Margin: NEXE reported its first-ever positive gross profit of $16,453 with a 13.7% gross margin, which we believe represents an early step toward scalable profitability.
- Cost Control: Selling, general, and administrative expenses decreased 3% year-over-year to $735,484, driven by disciplined management of professional fees and salaries.
- Strong Liquidity: NEXE maintained a solid balance sheet with $11.45 million in cash and GIC investments, and minimal debt.
- Food Safety Certification: Successfully passed a third-party Food Safety Small Supplier Audit—a requirement for one of North America’s largest retailers—achieving an overall 99% pass rate.
“This quarter marks an important step forward for NEXE,” said Ash Guglani, President of NEXE. “We achieved positive gross margins, expanded our partnerships, and demonstrated compliance with leading food safety standards. With a strong balance sheet and what we believe is growing market interest, we are well positioned to continue building momentum toward our long-term growth goals.”
In Q1 2026, NEXE’s revenues increased to $120,484, up from $3,147 in Q1 2025, as production ramps up for the next-generation BPI-certified compostable coffee pod. We expect revenues to continue to improve, as the Q1 period, particularly June, is a seasonally weak time for the coffee industry. Since the end of Q1, NEXE has received purchase orders that exceed Q1 2026, and customers have begun placing repeat orders. NEXE also announced a new partnership with a West Coast–based roaster—a respected British Columbia company recognized for its sustainability leadership and commitment to the circular economy—with an initial purchase order of 100,000 compostable pods.
In Q1 2026, NEXE allocated resources to work with one of our customers to conduct a food safety supplier audit for one of the largest North American retailers. NEXE successfully passed the Food Safety Small Supplier Audit conducted by a third-party verifier with an overall pass rate of 99%, scoring 100% in seven out of the nine categories. We believe this will benefit all of our customers, as they can target one of the largest North American retailers and retail distribution channel to shelf their products, using the NEXE Pod. We expect this will encourage more coffee companies and brands to consider transitioning to the fully compostable NEXE Pod.
As our partners and customers continue to transition their coffee products to our compostable technology and we onboard new customers, we have observed an increase in inbound inquiries. One of our main customers, which initially started working with us at the beginning of calendar year 2025, had initially transitioned six SKUs, and by the end of November 2025 we expect it will increase to 17 SKUs.
As NEXE continues to scale its operations, it remains focused on cost management, process optimization, and operational efficiency. The Company reported positive gross profit for the first time, amounting to $16,453 and a gross margin of 13.7%. Selling, general, and administrative costs were another highlight of cost control decreasing by 3% to $735,484 from the year-ago period. A key investment focus is R&D, where NEXE continues to develop its compostable technology platform to target new verticals.
At the end of Q1 2026, our total cash is $2,780,912, and GIC investments are $8,673,468, with minimal debt and commitments. Based on our current expected volumes and cost structure, we believe there is sufficient funding to meet our strategic priorities in the short-term.
The Company’s Q1 2026 financial statements and related management’s discussion and analysis are available on NEXE’s SEDAR+ profile at www.sedarplus.ca and the Company’s website at www.nexeinnovations.com.
*NEXE Innovations Inc. is not affiliated with, endorsed, or sponsored by Keurig®. Keurig® is a registered trademark of Keurig Dr Pepper Inc.
**NEXE Innovations Inc. is not affiliated with, endorsed, or sponsored by Nespresso®. Nespresso® is a registered trademark of Société des Produits Nestlé S.A
