Financial Analysis

NOTE 13. COMMITMENTS AND CONTINGENCIES Lease Costs The Company made cash payments for all operating leases for the years ended June 30, 2025 and 2024, of approximately $ 0.41 million and $ 0.58 million, respectively, which were included in cash flows from operating activities within the consolidated statements of cash flows. As of June 30, 2025, the Companys operating leases have a weighted average remaining lease term of 0.60 years and weighted average discount rate of 8.20 %. The total rent expense for all operating leases for the years ended June 30, 2025 and 2024, was approximately $ 0.33 million and $ 0.46 million, respectively. THE GLIMPSE GROUP, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Lease Commitments The Company has various operating leases for its offices. These existing leases have remaining lease terms ranging from approximately 0.5 to 1.5 years. Certain lease agreements contain options to renew, with renewal terms that generally extend the lease terms by 1 to 3 years for each option. The Company determined that none of its current leases are expected to be renewed except one. That remaining lease will not be renewed under its current terms and will be renegotiated. Therefore, said lease does not have a measurable term or rate to calculate future lease payments beyond its current term. Future approximate undiscounted lease payments for the Companys operating lease liabilities and a reconciliation of these payments to its operating lease liabilities as of J …

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The timing of revenue recognition for the years ended June 30, 2025 and 2024 was as follows: SCHEDULE OF TIMING REVENUE RECOGNITION 2025 2024 For the Years Ended June 30, 2025 2024 Products and services transferred at a point in time $ 9,979,789 $ 7,371,004 Products and services transferred/recognized over time 548,137 1,433,195 Total Revenue $ 10,527,925 $ 8,804,199

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NOTE 7. GOODWILL AND INTANGIBLE ASSETS The composition of goodwill as of June 30, 2025 and 2024 is as follows: SCHEDULE OF COMPOSITION OF GOODWILL As of June 30, 2025 XRT BLI Total Goodwill $ 300,000 $ 10,557,600 $ 10,857,600 XRT PulpoAR BLI Total As of and for the Year ended June 30, 2024 XRT PulpoAR BLI Total Goodwill - beginning of year $ 300,000 $ 379,038 $ 10,557,600 $ 11,236,638 Impairments - (379,038 ) - (379,038 ) Goodwill - end of year $ 300,000 $ - $ 10,557,600 $ 10,857,600 The composition of Intangible assets, their respective amortization period, and accumulated amortization as of June 30, 2025 and 2024 are as follows: SCHEDULE OF INTANGIBLE ASSETS, AMORTIZATION PERIOD AND ACCUMULATED AMORTIZATION XR Terra BLI Glimpse Learning Total As of June 30, 2025 Value ($) Amortization Period (Years) XR Terra BLI Glimpse Learning Total Intangible Assets Technology 300,000 880,000 326,435 1,506,435 3 Less: Accumulated Amortization (300,000 ) (855,542 ) (290,176 ) (1,445,718 ) Intangible Assets, net $ - $ 24,458 $ 36,259 $ 60,717 XR Terra Pulpo BLI Glimpse Learning Total As of and for the Year ended June 30, 2024 Value ($) Amortization Period (Years) XR Terra Pulpo BLI Glimpse Learning Total Intangible Assets Customer Relationships - beginning of year $ - $ - $ 3,310,000 $ - $ 3,310,000 5 Customer Relationships - impairment - - (3,310,000 ) - (3,310,000 ) Customer Relationships - end of year - - - - - Technology - beginning of year 300,000 925,000 880,000 326,435 2,431,435 3 T …

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NOTE 12. PROVISION FOR INCOME TAXES The components of loss before provision for income taxes for the years ended June 30, 2025 and 2024 were as follows: SCHEDULE OF LOSS BEFORE PROVISION FOR INCOME TAXES 2025 2024 For the Years ended June 30, 2025 2024 Loss subject to domestic income taxes $ (2,197,907 ) $ (4,195,185 ) Loss subject to foreign income taxes (354,744 ) (2,199,110 ) Total loss $ (2,552,651 ) $ (6,394,295 ) The Company recorded provision for foreign income taxes for the years ended June 30, 2025 and 2024 consists of the following: SCHEDULE OF PROVISION FOR FOREIGN INCOME TAXES 2025 2024 For the Years ended June 30, 2025 2024 Current $ - $ 38,588 Deferred - (38,588 ) Total provision for income taxes $ - $ - There was no current or deferred income tax provision for the years ended June 30, 2025 and 2024. THE GLIMPSE GROUP, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The reconciliation of taxes at the U.S. federal statutory rate to our provision for income taxes for the years ended June 30, 2025 and 2024 were as follows: SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION STATUTORY RATE For the Years Ended June 30, 2025 2024 Statutory Federal Income Tax Rate -21.00 % -21.00 % State and Local Taxes, Net of Federal Tax Benefit -2.34 % -10.15 % Stock Based Compensation Expense (ISO) 5.52 % 3.46 % Foreign tax rate differential -4.00 % -4.00 % GAAP to Statutory rate 3.47 % 13.76 % Change in Valuation Allowance 18.35 % 17.93 % Income Taxes Provision 0.00 % 0.00 % The …

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Recent Accounting Pronouncements Not Yet Adopted In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which includes amendments that further enhance income tax disclosures, primarily through standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. The amendments are effective for the Companys annual periods beginning July 1, 2025. The Company is currently evaluating the ASU to determine its impact on the Companys disclosures. …

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NOTE 9. DEFERRED COSTS AND DEFERRED REVENUE As of June 30, 2025 and 2024, deferred costs totaling $ 48,971 and $ 170,781 , respectively, consists of costs deferred under contracts not completed and recognized at a point in time ($ 48,971 and $ 135,057 , respectively), and costs in excess of billings under contracts not completed and recognized over time ($ 0 and $ 35,724 , respectively). As of June 30, 2025 and 2024, deferred revenue, totaling $ 52,576 and $ 72,788 , respectively, consists of revenue deferred under contracts not completed and recognized at a point in time. The following table shows the net activity of deferred cost and deferred revenue for the years ended June 30, 2025 and 2024: SCHEDULE OF RECONCILIATION OF COST IN EXCESS OF BILLING FOR CONTRACT RECOGNIZED OVER TIME 2025 2024 As of and for the Years ended June 30, 2025 2024 Deferred costs - beginning of year $ 170,781 $ 158,552 Deferred cost recognized as cost of goods sold during year $ (170,781 ) (158,552 ) Costs incurred and not yet recognized as cost of goods sold $ 48,971 170,781 Deferred cost - end of year $ 48,971 $ 170,781 Deferred revenue - beginning of year $ 72,788 $ 466,393 Deferred revenue recognized as revenue during year $ (72,788 ) (466,393 ) Payments received and not yet recognized as revenue $ 52,576 72,788 Deferred revenue - end of year $ 52,576 $ 72,788 THE GLIMPSE GROUP, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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NOTE 4. SEGMENT AND RELATED INFORMATION The Company has one reportable segment managed on a consolidated basis: Immersive technology software development and commercialization. The Company derives revenue primarily in the United States and manages all business activities on a consolidated basis. The services are deployed to customers in a similar manner. The Companys chief operating decision maker (CDOM) is the Chief Executive Officer who reviews financial information presented on a consolidated basis to allocate resources, evaluate performance and make overall operating decisions. The measure of segment profit or loss that is most consistent with the consolidated financial statements is net cash used in operating activities. The accounting policies of our single reportable segment are the same as those for the consolidated financial statements. The level of disaggregation and amounts of significant revenue and cash expenses that are regularly provided to the CDOM are the same as presented in the consolidated statement of cash flows. Likewise, the measure of segment assets is reported on the consolidated balance sheets as total assets. …

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NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). Principles of Consolidation The accompanying consolidated financial statements include the balances of Glimpse and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. Use of Accounting Estimates The preparation of the accompanying consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the accompanying consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. The principal estimates relate to the valuation of allowance for doubtful accounts, stock options, revenue recognition, allocation of the purchase price of assets relating to business combinations, calculation of contingent consideration for acquisitions, fair value of intangible assets and goodwill impairment. THE GLIMPSE GROUP, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Cash and Cash Equivalents Cash and equivalents represent cash and short-term, highly liquid investments, that are both readily convertible to known amoun …

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NOTE 10. EQUITY Securities Purchase Agreements (SPA) SPA 2024 In December 2024, the Company completed a SPA with an institutional investor selling 1,990,000 shares of common stock at $ 2.65 per share and pre-funded warrants to purchase up to 760,000 shares of common stock at $ 2.649 per warrant (which is convertible to one share of common stock on a one for one basis). The pre-funded warrants were exercised in full in January 2025 at the exercise price of $ 0.001 per share of common stock. The Company realized total net proceeds (after underwriting and professional fees) of $ 6.79 million from the SPA 2024. SPA 2023 In October 2023, the Company completed a SPA with certain institutional investors selling 1,885,715 shares of common stock for approximately $ 3.30 million (at $ 1.75 per share). The Company realized net proceeds (after underwriting, professional fees and listing expenses) of $ 2.97 million. Simultaneously, the exercise price on warrants to purchase 750,000 shares of common stock originally issued pursuant to a SPA entered into in November 2021 were repriced from $ 14.63 per share to $ 1.75 per share. Common Stock Issued Exercise of Warrants In December 2024, an institutional investor exercised warrants (issued in connection with a November 2021 SPA) convertible into 100,000 shares of common stock. The Company realized proceeds of $ 0.18 million ($ 1.75 per share). In January 2025, an institutional investor exercised warrants (issued in connection with a December …

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NOTE 14. SUBSEQUENT EVENTS In August 2025, the Company closed on an agreement to sell its Pose With the Pros business for an initial consideration of $ 0.25 million in cash and potential future revenue royalties. In connection therewith, the Company received a $ 0.05 million nonrefundable prepayment of the consideration in June 2025, which is recorded in accrued liabilities in the balance sheet as of June 30, 2025. This divestiture is not expected to have a material effect on the Companys revenue and expense. It is anticipated the Company will record a gain at the time of the sale of no more than the initial consideration. …

SubsequentEventsTextBlock · excerpt; the full note is in the filing