What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-02-17 compared with 2026-02-17 · 140 added, 303 removed, 365 unchanged (55% of the section changed)

MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

References in this report (the “Quarterly

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Words such as “expect,”

“believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar

words and expressions are intended to identify such forward-looking statements.

Such forward-looking statements relate to future events

or future performance, but reflect management’s current beliefs, based on information currently available.

A number of factors could

cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking

“believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and

similar words and expressions are intended to identify such forward-looking statements.

Such forward-looking statements relate to future

events or future performance, but reflect management’s current beliefs, based on information currently available.

A number of factors

could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking

For information identifying important factors that could cause actual results to differ materially from those anticipated

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website at www.sec.gov.

Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to

update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

Except as expressly required by applicable securities law, the Company disclaims any intention or obligation

to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

Triller Group Inc.

is formed in the State of Delaware,

on October 15, 2024, which was established to domicile its legal jurisdiction from British Virgin Islands to the State of Delaware.

is formed in the State of

Delaware, on October 15, 2024, which was established to domicile its legal jurisdiction from British Virgin Islands to the State of Delaware.

Nasdaq Listing Extension

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Goldman Sachs Research estimated the creator economy could reach $480 billion by 2027 in its April 2023 report titled “The creator

economy could approach half-a-trillion dollars by 2027.”

economy could approach half-a-trillion dollars by 2027.” Our revenue was $4.8 million and $7.7 million in the three months ended

March 31, 2025 and 2024.

We have incurred net losses in each year since our inception, including $53.1 million and $8.1 million for the

three months ended March 31, 2025 and 2024, respectively.

Through our subsidiaries in Hong Kong, we

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Business (collectively as “Financial Services Business”) and offer unique product and service offerings:

tech-enabled broker

management platform for advisors (“ Platform Business ”);

market leading

portfolio of wealth and health products (“ Distribution Business ”).

tech-enabled broker management platform for advisors

(“ Platform Business ”);

market leading portfolio of wealth and health products

(“ Distribution Business ”).

We also have a market leadership in our healthcare

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up a large and highly productive salesforce.

As of June 30, 2025, there were around 394 financial advisors at “Focus”,

organized into 9 sales teams.

Each team is led by a “tree head”, responsible for managing the financial advisors within

In addition to the FA Business, we continued to

expand our distribution footprint with the establishment and expansion of a number of additional distribution channels, collectively known

as our Alternative Distribution Business.

These distribution channels are targeted at specific customer segments and/or capturing specific

distribution opportunities.

As of March 31, 2025, there were around 474 financial advisors at “Focus”, organized

into 9 sales teams.

Each team is led by a “tree head”, responsible for managing the financial advisors within their teams.

In addition to the FA Business, we continued

to expand our distribution footprint with the establishment and expansion of a number of additional distribution channels, collectively

known as our Alternative Distribution Business.

These distribution channels are targeted at specific customer segments and/or capturing

specific distribution opportunities.

We have continued to make significant investments

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capabilities and improve our supporting infrastructure, we have successfully developed these inter-related strategic assets:

Vast customer base in Hong Kong and growing customer base in Mainland China.

Vast customer base

in Hong Kong and growing customer base in Mainland China.

State-of-the-art supporting

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well-trained salesforce.

We will continue to capitalize on these core strategic

assets and match them with the emerging opportunities in our three core industries (life insurance, wealth management and healthcare).

We will continue to widen our distribution footprint

and actively explore further opportunities to develop partnerships and generate customer leads on the ground in Mainland China, as well

as refining our abilities to service our customer base.

We expect sales volumes to return to the levels previously recorded, prior to

the pandemic period, especially with the re-opening of the Mainland border and the ongoing integration of Hong Kong into the Greater Bay

We will continue to capitalize on these core

strategic assets and match them with the emerging opportunities in our three core industries (life insurance, wealth management and healthcare).

We will continue to widen our distribution

footprint and actively explore further opportunities to develop partnerships and generate customer leads on the ground in Mainland China,

as well as refining our abilities to service our customer base.

We expect sales volumes to return to the levels previously recorded,

prior to the pandemic period, especially with the re-opening of the Mainland border and the ongoing integration of Hong Kong into the

Greater Bay area.

Results of Operations

Comparison of the Three Months Ended June 30, 2025 and 2024:

Comparison of the Three Months Ended March 31, 2025 and 2024:

The following tables set forth our results

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dollars (in thousands):

For the Three Months ended June

For the Three Months ended March

Sports streaming

Financial services

Loans interest income

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Commission expense

Sales and marketing expenses

Research and development expenses

Personal and benefit expenses

Research and development expense

Personnel and benefit expense

Legal and professional fee

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Provision for allowance for expected credit losses

Other general and administrative

Other general and administrative expenses

Total operating expenses

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Interest expense

Foreign exchange gain (loss), net

Foreign exchange gain, net

Bad debts written-off

Sundry income

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Net income (loss)

Three Months ended June 30, 2024

Three Months ended March 31,

Asset management service fees

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Commission expense

Sales and marketing expenses

Research and development expenses

Personnel and benefit expenses

Sales and marketing expense

Research and development expense

Personnel and benefit expense

Legal and professional fee

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Interest expense

Change in fair value of warrant liabilities

Total other income (expense), net

Investment loss, net

Total other expense, net

Income tax expense

The following table summarizes the major operating revenues for

the three months ended June 30, 2025 and 2024:

the three months ended March 31, 2025 and 2024:

Three months ended

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No income from social media and sports streaming

business segments are generated during the three months ended June 30, 2025 and 2024.

business segments are generated during the three months ended March 31, 2025 and 2024.

The Company generated minimal operations in these

two segments during the three months ended June 30, 2025.

two segments during the three months ended March 31, 2025.

Financial services

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comprises of commission income, recurring assets management service income, and interest income.

Income from financial services slightly

increased by $0.6 million or 12.09% from $4.9 million for the three months ended June 30, 2024 to $5.5 million for the three months ended

June 30, 2025.

Income from financial services decreased

by $2.9 million or 37.55% from $7.7 million for the three months ended March 31, 2024 to $4.8 million for the three months ended March

The decrease in revenue is primarily attributed to the economic recession and outward migration in Hong Kong.

Operating Expenses

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The commission expense related to financial

services increased by $2.0 million, or 151.18% from $1.3 million for the three months ended June 30, 2024 to $3.3 million for the three

months ended June 30, 2025.

As a result of the increase in revenue associated with the financial services, commission expense increased

services decreased by $1.9 million, or 43.30% from $4.4 million for the three months ended March 31, 2024 to $2.5 million for the three

months ended March 31, 2025.

As a result of the decrease in revenue associated with the financial services, commission expense decreased

correspondingly.

Sales and Marketing Expense

Sales and marketing expense slightly increased

by $0.04 million or 133.33 % from $0.03 million for the three months ended June 30, 2024 to $0.07 million for the three months ended

June 30, 2025.

Sales and marketing expense decreased by $0.5

million or 100% from $0.5 million for the three months ended March 31, 2024 to nil for the three months ended March 31, 2025.

was mainly attributed to lower spending associated with “AGBA” corporate branding.

Research and Development Expense

Research and development expense increased

by $0.9 million, or 179.19% from $0.5 million for the three months ended June 30, 2024 to $1.4 million for the three months ended June

The increase was primarily due to additional expense incurred by Triller Corp.

and its subsidiaries, which was acquired on

October 15, 2024.

by $1.2 million, or 271.62% from $0.5 million for the three months ended March 31, 2024 to $1.7 million for the three months ended March

The increase was primarily due to the additional expense incurred by Triller Corp.

and its subsidiaries, which was acquired

on October 15, 2024.

Personnel and benefit expenses

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technology, corporate development, finance and accounting employees and executives.

in thousands)

Three months ended

(US$ in thousands)

Personnel and benefit

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Personnel and benefit cost increased by $3.3

million, or 41.12% from $4.9 million for the three months ended June 30, 2024 to $7.0 million for the three months ended June 30, 2025.

million, or 72.09% from $4.5 million for the three months ended March 31, 2024 to $7.8 million for the three months ended March 31, 2025.

The increase was primarily attributable to the additional headcount from the acquisition of Triller Corp.

and its subsidiaries, which

was completed on October 15, 2024.

which was completed on October

Stock-based compensation for executive directors

and employees increased by $13.7 million for the three months ended June 30, 2025, as compared to the three months ended June 30, 2024.

and employees increased by $25.6 million for the three months ended March 31, 2025, as compared to the three months ended March 31, 2024.

The increase was primarily due to the settlement of accrued salaries to certain executive directors and employees of the Company and

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Legal and professional fees increased by $3.6

million, or 134.50%, from $1.3 million for three months ended June 30, 2024, to $3.0 million for three months ended June 30, 2025.

increase was primarily attributable to the additional legal and professional fees incurred by Triller Corp.

and its subsidiaries, which

was acquired on October 15, 2024.

million, or 545.76%, from $0.7 million for three months ended March 31, 2024, to $4.3 million for three months ended March 31, 2025.

The increase was primarily attributable to the additional legal and professional fees incurred by Triller Corp.

and its subsidiaries,

which was acquired on October 15, 2024.

Consulting fees under stock-based compensation

increased by $2.7 million or 1,349.25% for the three months ended June 30, 2025, as compared to the three months ended June 30, 2024.

increased by $1.4 million or 633.02% for the three months ended March 31, 2025, as compared to the three months ended March 31, 2024.

The increase was mainly attributable to the increase in corporate strategic consultancy and business marketing service rendered by certain

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which is recorded as a liability to offset the receivables.

For the three months ended June 30, 2025 and 2024, the aggregated provision

For the three months ended March 31, 2025 and 2024, the aggregated provision

for allowance for expected credit losses on accounts receivable, loans receivable, notes receivable, and other receivables was $0.05

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The aggregate other general and administrative

expenses slightly decreased by $0.2 million, or 13.92% from $1.4 million for the three months ended June 30, 2024 to $1.2 million for

the three months ended June 30, 2025.

The decrease was primarily attributable to the absence of certain non-recurring expenses incurred

in the prior period.

Other Income (Expense), net

Other income (expense), net consist of interest

income, foreign exchange gain, net, sundry income and offset by interest expense, and bad debts written-off.

For the three months ended June 30, 2025 and 2024, the aggregate other

expense, net decreased by $0.6 million or 16.00%.

The increase was mainly attributable to the increase in interest expense of $4.8 million,

offset by the increase in foreign exchange gain, net of $1.8 million and decrease in change in fair value of warrant liabilities of $3.6

Net loss increased by $20.8 million, or 183.27%

for the three months ended June 30, 2025, as compared to June 30, 2024.

The increase was primarily due to the increase in operating expenses

and total other expense, net in three segments.

Comparison of the Six Months Ended June 30, 2025 and 2024:

The following tables set forth our results

of operations by segments presented in U.S.

dollars (in thousands):

Six months ended June 30, 2025

Loans interest income

Recurring asset management service fees

Advertising revenue

Subscription fees and paid-per-view

Total revenue

Operating expenses

Commission expense

Sales and marketing expenses

Research and development expenses

Personal and benefit expenses

Legal and professional fee

Office and operating fee, related party

Provision for allowance for expected credit losses

Other general and administrative

Total operating expenses

Other income (expense)

Interest income

Interest expense

Foreign exchange gain (loss), net

Bad debts written-off

Total other income (expense), net

Income tax expense

Net income (loss)

Six months ended June 30, 2024

Financial services

Asset management service fees

Loans interest income

Total revenue

Operating expenses

Commission expense

Sales and marketing expenses

Research and development expenses

Personal and benefit expenses

Legal and professional fee

Legal and professional fee, related party

Office and operating fee, related party

Provision for allowance for expected credit losses

Other general and administrative expenses

Total operating expenses

Other income (expense)

Interest income

Interest expense

Investment loss, net

Change in fair value of warrant liabilities

Total other expense, net

Income tax expense

The following table summarizes the major operating revenues for

the six months ended June 30, 2025 and 2024:

Six months ended

(US$ in thousands)

Business segment

Sports streaming

Financial services

Social media and Sports streaming

Since October 2024, we completed the merger

transaction pursuant to the merger agreement, through which we acquired all of the equity interests of Triller Corp.

Following the acquisition,

Triller Corp.’s operations have been consolidated into our operations, consisting of two major business segments:

and sports streaming.

Social media business segment mainly comprises

of revenues from the provision of advertising services and SaaS services.

The technology platform integrated from Triller Corp.

brands a variety of advertising services including AI-powered conversations and the augmentation and execution of advertising campaigns.

In addition, the SaaS platform provides our customers a detailed dashboard to measure all creator driven marketing campaigns as well

as a marketplace allowing e-commerce brands to automate the process of on-boarding creators with per-transaction incentives for enabling

e-commerce transactions.

Revenue from the SaaS platform subscriptions is recognized ratably over the life of a subscription.

Sports streaming business segment mainly comprises

of revenues from subscriptions for streaming services and pay-per-view (“PPV”) services for premium content and events.

technology platform provides streaming services that acquires content licensing from various sport and entertainment franchises to provide

a content rich environment for both subscription based and pay-per-view consumption both across a variety of platforms including mobile

phones, tablets, PCs, streaming devices, set-top-boxes and connected TVs.

Revenue from streaming subscriptions is recognized ratably

over the life of a subscription and revenue from streaming pay-per-view events is recognized at the time the event airs.

No income from social media and sports streaming

business segments are generated during the six months ended June 30, 2025 and 2024.

The Company generated minimal operations in these

two segments during the six months ended June 30, 2025.

Financial services

Financial services business segment mainly

comprises of commission income, recurring assets management service income, and interest income.

Income from financial services decreased

by $2.3 million or 18.14% from $12.6 million for the six months ended June 30, 2024 to $10.3 million for the six months ended June 30,

The decrease in revenue is primarily attributed to the economic recession and outward migration in Hong Kong.

Operating Expenses

Commission Expense

The commission expense related to financial

services increased by $0.07 million, or 1.15% from $5.76 million for the six months ended June 30, 2024 to $5.83 million for the six

months ended June 30, 2025.

As a result of the increase in commission rate associated with the financial services, commission expense

increased correspondingly.

Sales and Marketing Expense

Sales and marketing expenses decreased by

$0.4 million or 86.35 % from $0.5 million for the six months ended June 30, 2024 to $0.07 million for the six months ended June 30, 2025.

The decrease was mainly attributed to lower spending associated with “AGBA” corporate branding.

Research and Development Expense

Research and development expenses increased

by $2.1 million, or 223.61% from $1.0 million for the six months ended June 30, 2024 to $3.1 million for the six months ended June 30,

The increase was primarily due the additional expense incurred by Triller Corp.

and its subsidiaries, which was acquired on October

Personnel and benefit expenses

Personnel and benefit expenses primarily consist

of personnel-related costs and benefits and stock-based compensation costs for our administrative, legal, human resources, information

technology, corporate development, finance and accounting employees and executives.

in thousands)

Personnel and benefit

Stock-based compensation

Personnel and benefit cost increased by $5.3

million, or 55.92% from $9.5 million for the six months ended June 30, 2024 to $14.8 million for the six months ended June 30, 2025.

The increase was primarily attributable to the additional headcount from the acquisition of Triller Corp.

and its subsidiaries, which

was completed on October 15, 2024.

Stock-based compensation for executive directors

and employees increased by $39.3 million for the six months ended June 30, 2025, as compared to the six months ended June 30, 2024.

increase was primarily due to the settlement of accrued salaries to certain executive directors and employees of the Company and the

amortization of the fair value of restricted share units.

The fair value of the restricted share units is recognized over the period

based on the derived service period (usually the vesting period), on a straight-line basis.

Legal and professional fee

Legal and professional fees mainly consisted

of certain professional consulting services in legal, audit, accounting and taxation, and others.

Six months ended

(US$ in thousands)

Legal and professional fee

Stock-based compensation

Legal and professional fees increased by $9.2

million, or 350.40%, from $2.6 million for the six months ended June 30, 2024, to $11.8 million for the six months ended June 30, 2025.

The increase was primarily attributable to the additional legal and professional fees incurred by Triller Corp.

and its subsidiaries,

which was acquired on October 15, 2024.

Consulting fees under stock-based compensation

increased by $4.1 million or 979.09% for the six months ended June 30, 2025, as compared to the six months ended June 30, 2024.

was mainly attributed to the increase in corporate strategic consultancy and business marketing service rendered by certain third party

Provision for allowance for expected credit losses

In accordance with Accounting Standards Codification

(“ASC”) Topic 326 “Credit Losses – Measurement of Credit Losses on Financial Instruments” (ASC Topic326),

the Company utilizes the current expected credit losses (“CECL”) model to determine an allowance that reflects its best estimate

of the expected credit losses on accounts receivable, loans receivable, notes receivable, and deposits, prepayments and others receivable

which is recorded as a liability to offset the receivables.

For the six months ended June 30, 2025 and 2024, the aggregated provision

for allowance for expected credit losses on accounts receivable, loans receivable, notes receivable, and other receivables was $0.1 million

and $1.7 million, respectively.

Other general and administrative expenses

of social media and sports streaming segments primarily consist of professional service fees, business process outsourcing costs, music

licensing, and insurance premiums.

Other general and administrative expenses

of financial services and corporate segments primarily consist of rent and facilities expenses allocated based upon total direct costs,

depreciation and amortization expenses, and other corporate expenses that are not allocated to the above expense categories.

The aggregate other general and administrative

expenses increased by $1.7 million, or 72.35% from $2.3 million for the six months ended June 30, 2024 to $3.9 million for the six months

ended June 30, 2025.

expenses increased by $1.9 million, or 210.57% from $0.9 million for the three months ended March 31, 2024 to $2.7 million for the three

months ended March 31, 2025.

The increase was primarily attributable to the additional expenses incurred by Triller Corp.

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Other income (expense), net consist of interest

income, foreign exchange gain, net, sundry income and offset by interest expense and bad debts written-off.

For the six months ended June 30, 2025 and 2024, the aggregate other

expense, net increased by $7.8 million or 180.11%.

The increase was mainly attributable to the increase in bad debts written-off of $5.4

million and interest expense of $9.4 million, which were mainly incurred by Triller Corp and its subsidiaries.

These amounts were offset

by the increase in foreign exchange gain, net of $2.9 million and decrease in change in fair value of warrant liabilities of $3.6 million.

income, foreign exchange gain, net, sundry income and offset by interest expense, bad debts written-off, written-off of accounts payable

and other current liabilities, and investment loss, net.

For the three months ended March 31, 2025

and 2024, the aggregate other expense, net increased by $8.5 million or 2,298.37%.

The increase was mainly attributable to the

increase in interest expense of $4.6 million, and bad debts written-off of $5.4 million, offset by the increase in foreign exchange gain, net of $1.1 million.

Net loss increased by $45.0 million, or 558.23%

for the six months ended June 30, 2025, as compared to June 30, 2024.

The increase was primarily due to the increase in operating expenses

and total other expense, net in three segments.

for the three months ended March 31, 2025, as compared to March 31, 2024.

The increase was primarily due to the sale decline and increase

in operating expenses of $33.7 million and increase in other expense, net of $8.5 million.

Liquidity and Capital Resources

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negative operating cash flows.

For the six months ended June 30, 2025, we reported a net loss of $85.3 million and reported a negative

For the three months ended March 31, 2025, we reported a net loss of $53.1 million and reported a negative

operating cash flow of $16.2 million.

As of June 30, 2025, our cash balance was $2.1 million for working capital use.

As of March 31, 2025, our cash balance was $2.1 million for working capital use.

Our management

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governing such debt could provide for operating and financing covenants that would restrict our operations.

As of June 30, 2025, we had cash and cash

As of March 31, 2025, we had cash and cash

equivalents totaling $2.1 million, and $12.8 million in restricted cash.

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equivalents totaling $3.1 million, and $14.2 million in restricted cash.

Comparison of the six months ended June

30, 2025 and 2024

Comparison of the three months ended

March 31, 2025 and 2024

The following table summarizes our cash flows

for the periods presented:

Six months ended

Three months ended

(US$ in thousands)

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Working Capital Deficit

The working capital deficit as of June 30,

2025 and December 31, 2024 was amounted to approximately $310.6 million and $271.6 million, respectively, an increase of $38.9 million

The increase was mainly attributable to the increase in current liabilities related to the acquisition of Triller Corp.

its subsidiaries, which completed on October 15, 2024.

The working capital deficit as of March

31, 2025 and December 31, 2024 was amounted to approximately $294.3 million and $271.6 million, respectively, an increase of $22.7

million or 8.36%.

The increase was mainly attributable to the increase in current liabilities related to the acquisition of Triller

and its subsidiaries, which completed on October 15, 2024.

Cash Flows from Operating Activities

Net cash used in operating activities was

$20.4 million and $14.2 million for the six months ended June 30, 2025 and 2024, respectively.

$16.2 million and $6.9 million for the three months ended March 31, 2025 and 2024, respectively.

Net cash used in operating activities for

the six months ended June 30, 2025 was primarily the result of the net loss of $85.3 million, decrease in escrow liabilities of $2.2

million, decrease in operating lease liabilities of $0.5 million, increase in accounts receivable of $1.5 million and increase in loans

receivables of $1.0 million.

These amounts were partially offset by the increase in accounts payable and other current liabilities of

$9.7 million, increase in other current liabilities, related parties of $1.3 million, and non-cash adjustments consisting of share-based

compensation expense of $45.9 million, interest expense on borrowings of $10.0 million, net foreign exchange gain of $2.9 million, bad

debts written-off of $5.4 million, and provision for allowance for expected credit losses of $0.1 million.

the three months ended March 31, 2025 was primarily the result of the net loss of $53.1 million, decrease in escrow liabilities of

$1.4 million, decrease in operating lease liabilities of $0.5 million, increase in accounts receivable of $1.5 million, increase in

loans receivable of $1.3 million, and increase in deposits, prepayments, and other receivables of $0.2 million.

These amounts were

partially offset by the increase in accounts payable and other current liabilities of $3.0 million, increase in other current

liabilities, related parties of $0.6 million, and non-cash adjustments consisting of stock-based compensation expense of $28.8

million, interest income on loans receivable of $0.2 million, interest expense on borrowings of $4.8 million, net foreign exchange

gain of $1.1 million, and bad debts written-off of $5.4 million.

Net cash used in operating activities for

the six months ended June 30, 2024 was primarily the result of the net loss of $19.4 million, an increase in deposits, prepayments, and

others receivable of $0.6 million, decrease in accounts payable and other current liabilities of $1.1 million, decrease in escrow liabilities

of $3.0 million, decrease in operating lease liabilities of $1.0 million, and decrease in income tax payable of $0.2 million.

These amounts

were partially offset by the decrease in accounts receivable of $1.0 million, and non-cash adjustments consisting of stock-based compensation

expense of $2.5 million, lease expense of $1.3 million, interest expense on convertible debts of $0.2 million, interest expense on borrowings

of $0.4 million, net foreign exchange loss of $0.3 million, and allowance for expected credit losses of $1.7 million.

the three months ended March 31, 2024 was primarily the result of the net loss of $8.1 million, an increase in deposits, prepayments,

and others receivable of $0.2 million, decrease in accounts payable and other current liabilities of $1.7 million, decrease in escrow

liabilities of $1.2 million, decrease in lease liabilities of $0.5 million, and decrease in income tax payable of $0.2 million.

amounts were partially offset by the decrease in accounts receivable of $1.2 million, and non-cash adjustments consisting of stock-based

compensation expense of $1.7 million, lease expense of $0.6 million, depreciation and amortization of $0.02 million, interest income

on notes receivable of $0.01 million, interest expense on borrowings of $0.2 million, net foreign exchange loss of $0.2 million, net

investment loss of US$0.04 million, and allowance for expected credit losses of $1.0 million.

Cash Flows from Investing Activities

Net cash provided by investing activities

for the six months ended June 30, 2025 of $1.5 million was primarily due to proceeds from the disposal of assets held for sale.

for the three months ended March 31, 2025 of $1.5 million was primarily due to proceeds from the disposal of assets held for sale.

Net cash provided by investing activities

for the six months ended June 30, 2024 of $2.6 million was primarily due to proceeds from sale of long-term investments of $2.2 million

and proceeds from sale of convertible notes receivable of $0.4 million.

for the three months ended March 31, 2024 of $2.2 million was primarily due to proceeds from sale of long-term investments and proceeds

from disposal of property and equipment.

Cash Flows from Financing Activities

Net cash provided by financing activities

for the six months ended June 30, 2025 of $15.0 million was primarily due to proceeds from borrowings advanced by a related party.

Net cash provided by financing activities

for the six months ended June 30, 2024 of $8.5 million was primarily due to advances from the stockholder.

for the three months ended March 31, 2025 of $11.7 million was primarily due to proceeds from borrowings advanced by a related party.

Net cash provided by financing activities for the three months ended

March 31, 2024 of $3.5 million was primarily due to advances from the stockholder.

Liquidity and Going Concern

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condensed consolidated financial statements were made available to be issued.

For the six months ended June 30, 2025, we

reported a net loss of approximately $85.3 million.

With a significant decrease in our revenues, described in the paragraph below, we

had an accumulated deficit of approximately $1,288.9 million as of June 30, 2025.

Coupled with the economic recession in Hong

Kong, we reported a sales decline with total revenue of approximately $2.3 million for the six months ended June 30, 2025, resulting

with an operating loss of approximately $73.0 million.

These circumstances give rise to substantial doubt that we will continue as a

going concern and these unaudited condensed consolidated financial statements do not include any adjustments that might result from the

outcome of this uncertainty.

For the three months ended March 31, 2025, we reported a net loss of

approximately $53.1 million.

With a significant decrease in our revenues, described in the paragraph below, we had an accumulated deficit

of approximately $1,256.7 million as of March 31, 2025.

However, coupled with the economic recession

in Hong Kong, we reported a sales decline with total revenue of approximately $4.8 million for the three months ended March 31, 2025,

resulting with an operating loss of approximately $44.2 million.

These circumstances give rise to substantial doubt that we will continue

as a going concern and these unaudited condensed consolidated financial statements do not include any adjustments that might result from

the outcome of this uncertainty.

Our ability to continue as a going concern

18 unchanged sentences

We have no guarantees or obligations other than those which arise out of normal business operations.

We have not engaged in any off-balance sheet financial

arrangements that have or are reasonably likely to have a material current or future effect on our financial condition, changes in financial

condition, net revenue or expenses, results of operations, liquidity, capital expenditures, or capital resources.

We have not engaged in any off-balance sheet

financial arrangements that have or are reasonably likely to have a material current or future effect on our financial condition, changes

in financial condition, net revenue or expenses, results of operations, liquidity, capital expenditures, or capital resources.

Critical Accounting Policies, Judgements and

4 unchanged sentences

and estimates as reported in our 2024 Annual Report on Form 10-K.

QUANTITATIVE AND QUALITATIVE DISCLOSURES

ABOUT MARKET RISK

As a “smaller reporting company” as

defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.

QUANTITATIVE AND

QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a “smaller reporting company”

as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q/A

Item 2. Management’s Discussion and Analysis