Karbon-X (OTCQB:KARX) Accelerates High-Margin Transformation in Q1 FY2027: Gross Margin Expands to 32%, Operating Cash Burn Drops 55%, and Deferred Revenue Reaches $4.3 Million

CALGARY, AB / ACCESS Newswire / October 22, 2026 / Karbon-X Corp. (OTCQB:KARX) ("Karbon-X" or the "Company"), a global carbon and environmental markets company, today announced its financial and operational results for the first quarter of fiscal 2027 (ended August 31, 2026), following the filing of its Quarterly Report on Form 10-Q.

The quarter was highlighted by a significant expansion in gross margin to 32%, a 55% reduction in net operating cash use, and continued momentum across international project development and advisory engagements.

Through disciplined execution, Karbon-X has shifted its commercial mix toward higher-margin, value-added environmental consulting and project commercialization, strengthening its operational foundation for sustainable, long-term growth.

First Quarter Fiscal 2027 Highlights

• Substantial Gross Margin Expansion: Gross margin rose to 32%, compared with 0.8% in the prior-year period, reflecting a higher-margin revenue mix centered on technical advisory and project-level activities.
• Disciplined Cash Optimization: Net cash used in operating activities decreased 55% to $1.2 million, down from $2.7 million in the prior-year period, demonstrating enhanced capital efficiency and operational discipline.
• Strong Forward Visibility: Deferred revenue increased 13% to $4.3 million as of August 31, 2026, compared with $3.8 million as of May 31, 2026, signaling sustained demand and commitment across the Company's client base.
• Senegal Mangrove Project Milestones: Advanced the ABC Mangrove Senegal initiative by invoicing a $540,000 development-cost advance under its offtake agreement for planting cycles three and four.
• Commercial Advisory Wins: Secured a new technical advisory engagement for a high-impact nature-based carbon project, successfully collecting the first-stage fee.

"Trading activity can vary significantly between reporting periods, and our strategy is designed to build a business with multiple sources of commercial opportunity," said Chad Clovis, Chief Executive Officer of Karbon-X. "We are continuing to develop our capabilities across environmental commodity trading, project development and advisory services, with a focus on improving our revenue mix and operating efficiency. As we move through fiscal 2027, our priorities remain clear: expand our international commercial activities, advance projects toward commercialization and build a more diversified business positioned for long-term growth."

Financial Review & Strategic Transformation

Karbon-X's Q1 FY2027 results reflect a strategic evolution away from volatile, low-margin industrial trading toward predictable, premium-value environmental project development and advisory contracts.

Strategic portfolio rebalancing drove a 32% gross margin for the first quarter. Reported revenue of $343,967 reflects the planned reduction of high-volume, low-margin industrial trading activity, which drove prior-year revenue of $35.7 million. Resource reallocation toward higher-margin activities has significantly improved the Company's gross margin profile, reflecting progress in its strategic transformation.

Net loss for the period was approximately $4.1 million, or $(0.04) per share, compared with $2.6 million, or $(0.03) per share, in the prior-year quarter. The result reflects continued investments in expanding global project pipelines, establishing commercial advisory channels, and advancing nature-based initiatives toward commercialization.

About Karbon-X

Karbon-X is a global carbon and environmental markets company that develops, markets and commercializes environmental commodities and attributes. Through its integrated capabilities across project development, environmental markets and climate solutions, Karbon-X connects organizations with opportunities to support measurable climate impact, enabling climate impact no single solution could achieve alone.

For more information, visit www.karbon-x.com

Forward-Looking Statements

This news release contains forward-looking statements, including but not limited to statements regarding Karbon-X Corp.'s plans and priorities for fiscal 2027, financial performance, business strategy, growth plans, ability to improve margins and operating efficiency, advancement of its project portfolio, and development of additional commercial opportunities.

Forward-looking statements are based on current expectations and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied. Investors should review the risks and uncertainties described in the Company's Annual Report on Form 10-K for the fiscal year ended May 31, 2026, its Quarterly Report on Form 10-Q for the three months ended August 31, 2026, and other filings with the U.S. Securities and Exchange Commission.

Karbon-X undertakes no obligation to update any forward-looking statements except as required by law.

Investor and Media Contacts

Investor Relations
Karbon-X Corp.
investors@karbon-x.com

Media Contact
Emma Caputo
VP of Marketing
Karbon-X Corp.
ec@karbon-x.com

All financial amounts are stated in U.S. dollars unless otherwise noted.

SOURCE: Karbon-X Project Inc.