What changed in this filing

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Item 2. Management’s Discussion and Analysis

2023-11-20 compared with 2023-08-22 · 138 added, 109 removed, 27 unchanged (90% of the section changed)

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

following discussion and analysis of financial condition and results of operations should be read in conjunction with our financial statements

and related notes included elsewhere in this report.

This discussion contains forward-looking statements that involve risks, uncertainties

and assumptions.

See “Cautionary Note Regarding Forward-Looking Statements.” Our actual results could differ materially from

those anticipated in the forward-looking statements as a result of certain factors discussed elsewhere in this report.

Group, Inc was incorporated in the State of Wyoming on March 28, 2019 and is in the business of providing technical services and solutions

via its social e-commerce platform.

We are committed to providing an international cloud-based intelligence system and independently

developed a micro-business cloud intelligence system called the “YCloud”, which provide technical and auto-billing management

services to micro-business online stores in China through big data analytics, machine learning mechanisms, social network recommendations,

and multi-channel data analysis.

Furthermore, we intend to expand our business in online payment systems and block-chain services in

market of individual micro-business owners represents a potential of 330 million users by the end of year of 2023.

YCloud serves corporate users in multiple industries, including Yuetao

Group, Zhiding, Lvyue, Yuebei, Yuedian, Coke GO, and Zhongyanshangyue.

We conduct business operations in mainland China and have established

trial operations in Hong Kong.

We expect to utilize the YCloud system to establish a global strategic cooperation with various social

media platforms.

main functions of the YCloud system are to manage users’ marketing relationships, CPS commission profit management, multi-channel

data statistics, AI fission and management, and improved supply chain systems.

YCloud serves the micro business industry.

We have expanded the application of YCloud to tourism, hospitality, livestreaming and short

video, medical beauty and traditional retail industries.

of Operations

Results of Operations for the Six months period

Ended June 30, 2023 and 2022

The following tables provide a comparison of a

summary of our results of operations for the six months period ended June 30, 2023 and 2022.

MANAGEMENT’S DISCUSSION

AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of financial

condition and results of operations should be read in conjunction with our financial statements and related notes included elsewhere in

This discussion contains forward-looking statements that involve risks, uncertainties and assumptions.

See “Cautionary

Note Regarding Forward-Looking Statements.” Our actual results could differ materially from those anticipated in the forward-looking

statements as a result of certain factors discussed elsewhere in this report.

WeTrade Group, Inc was incorporated in the State of

Wyoming on March 28, 2019.

We currently pursue two corporate strategies.

One business strategy is to continue providing software development

services, and the other strategy is to acquire and hold bitcoin.

Software development

We provide AI-enabled software development services

to our customers, which included developing, designing, and implementing various SAAS software solutions for businesses of all types,

including industrial and other businesses.

Bitcoin Acquisition Strategy

Our bitcoin acquisition strategy generally involves

acquiring bitcoin with our liquid assets that exceed working capital requirements, and from time to time, subject to market conditions,

issuing debt or equity securities or engaging in other capital raising transactions with the objective of using the proceeds to purchase

We view our bitcoin holdings as long-term holdings

and expect to continue to accumulate bitcoin.

We have not set any specific target for the amount of bitcoin we seek to hold, and we will

continue to monitor market conditions in determining whether to engage in additional financings to purchase additional bitcoin.

This overall strategy also contemplates that we may

(i) periodically sell bitcoin for general corporate purposes, including to generate cash for treasury management or in connection with

strategies that generate tax benefits in accordance with applicable law, (ii) enter into additional capital raising transactions that

are collateralized by our bitcoin holdings, and (iii) consider pursuing additional strategies to create income streams or otherwise generate

funds using our bitcoin holdings.

We believe that, due to its limited supply, bitcoin

offers the opportunity for appreciation in value if its adoption increases and has the potential to serve as a hedge against inflation

in the long-term.

Results of Operations

Results of Operations for the Nine months period

Ended September 30, 2023 and 2022

The following tables provide a comparison of a summary

of our results of operations for the nine months period ended September 30, 2023 and 2022.

September 30,

Service revenue- related parties

1 unchanged sentence

Cost of Revenue

Gross (Loss)/ Profit

Operating Expenses:

Impairment losses on digital assets

General and Administrative

Operation (Loss) /Profit

(10,419,873 )

Operation loss

(15,128,916 )

Other (expenses) /income

Net (Loss) /Profit before income tax

Net loss before income tax

Income tax expense

Net (Loss)/ Profit

from Operations

For the six-month period ended June 30, 2023 and 2022, total revenue

was $603,343 and $3,590,411 respectively, the decrease was mainly due to the decrease in Gross Merchandise Volume (“GMV”)

in YCloud system as a result of the adjusting of Company business plan in 2023.

The Company intend to shift its SAAS, block-chain and

WT Pay services from PRC to overseas market.

As of June 30, 2023 and 2022, service revenue from third party were $566,813 (2022:

and service revenue from related party were $36,530 (2022:

Revenue from Operations

For the nine-month period ended September 30, 2023

and 2022, total revenue was $2,238,029 and $9,197,681 respectively, the decrease was mainly due to the decrease in Gross Merchandise Volume

(“GMV”) in YCloud system as a result of the adjusting of Company business plan in 2023.

There were no income generated from

YCloud system in Q2 2023 and Q3 2023, however the decrease is offset by the increase in revenue of AI SAAS business $1.6 million in Q3

Cost of revenue

Cost of revenue mainly consists of staff payroll,

PRC central provident fund (“CPF”), staff benefits and YCloud system related expenses, the increase is mainly due to the fact

that more expenses were incurred for the system development and system iteration costs during the period.

and Administrative Expenses

For the six months period ended June 30, 2023

PRC central provident fund (“CPF”), staff benefits, system development costs and outsourcing staff cost for system development,

the decrease is in line with the decrease in revenue during the period.

General and Administrative Expenses

For the nine months period ended September 30, 2023

and 2022, general and administrative expenses were $15,128,916 and $10,419,873 respectively.

The decrease is mainly due to decrease in advertising

and promotion expenses during the period.

(Loss)/ Income

The increase is mainly due to increase in

system development expenses were incurred during the period.

As a result of the factors described above, there

was a net loss of $958,761 and net income of $140,177 for the period ended June 30, 2023 and 2022, respectively.

The increase in net loss

is mainly due to decrease in Gross Merchandise Volume (“GMV”) as a result of the adjusting of Company business plan in 2023.

The Company is intend to shift its SAAS, block-chain and WT Pay services from PRC to overseas market.

was a net loss of $9,455,304 and net income of $8,538,873 for the period ended September 30, 2023 and 2022, respectively.

in net loss is mainly due to decrease in Gross Merchandise Volume (“GMV”) as a result of the adjusting of Company business

plan in 2023 and no income were generated from Y-Cloud system in Q2 2023 and Q3 2023 respectively.

Results of Operations for the three months period

Ended June 30, 2023 and 2022

The following tables provide a comparison of

a summary of our results of operations for the three months period ended June 30, 2023 and 2022.

Ended September 30, 2023 and 2022

The following tables provide a comparison of a summary

of our results of operations for the three months period ended September 30, 2023 and 2022.

For the period

September 30,

From the period

September 30,

Service revenue- related parties

1 unchanged sentence

Cost of Revenue

Gross (Loss)/ Profit

Gross Profit/ (Loss)

Operating Expenses:

Impairment losses on digital assets

General and Administrative

Operation Loss

Net Profit/ (Loss) before income tax

(13,622,149 )

Net Loss before income tax

Income tax expense

Net Income/ (Loss)

Revenue from Operations

For the three-month period ended June 30, 2023

and 2022, total revenue was $nil and $1,451,459 respectively, the decrease was mainly due to the Company has changed its business strategy

and intends to shift its SAAS, block-chain and WT Pay services from PRC to overseas market.

For the three-month period ended September 30, 2023

and 2022, total revenue was $1,633,836 and $5,607,270 respectively, the decrease was mainly due to the Company has changed its business

strategy and intends to shift its SAAS services from PRC to overseas market.

There were no revenue were generated from Y-Cloud system

in Q2 2023 and Q3 2023.

The decrease is mitigated by the increase in revenue of our new AI-enabled SAAS business in Q3 2023.

Cost of revenue

Cost of revenue mainly consists of staff payroll,

PRC central provident fund (“CPF”), staff benefits and YCloud system related expenses, there is not material movement in cost

of revenue during the period.

It is mainly consists of staff payroll, PRC central

provident fund (“CPF”), staff benefits, system development costs and outsourcing staff cost for system development, the decrease

is in line with the decrease in revenue during the period.

General and Administrative Expenses

For the three months period ended June 30, 2023

and 2022, general and administrative expenses were $826,145 and $1,827,438 respectively, the decrease is mainly due to decrease in advertising

and promotion expenses during the period.

Net Income/ (Loss)

For the three months period ended September 30, 2023

and 2022, general and administrative expenses were $11,030,660 and $7,799,979 respectively.

The increase is mainly due to increase in

system development expenses were incurred during the period.

As a result of the factors described above, there

was a net income of $26,079 and net loss of $452,139 for the period ended June 30, 2023 and 2022, respectively, the increase in net income

is mainly due to bad debt recovered from third party during the period.

and Capital Resources

As of June 30, 2023, we had cash on hand of

The increase is mainly due to the fact that the Company has uplisted its common stock to the Nasdaq Capital Market with

the public offering of 10,000,000 shares of common stock with the net proceeds of $37,057,176 after deducting the total offering

cost of $2,942,824 in July 2022.

The increase is partially mitigated by the payment of system development fee.

As of June 30, 2023, our cash flow provided by

operating activities is $5,239,579 for the period ended June 30, 2023 as compared to the cash flow provided by operating activities of

$5,344,055 in prior period, which decreased by approximately of $0.1 million.

The decrease was mainly due to decrease in revenue and

decrease in Y-cloud SAAS services fee received from the customers during the period.

As of June 30, 2023, cash used in investing

activities is $5,605,401 for the period ended June 30, 2023 as compared to the cash flow used in investing activities of $36,674

was a net loss of $8,496,926 and net income of $8,859,541 for the period ended September 30, 2023 and 2022, respectively.

in net loss is mainly due to decrease in Gross Merchandise Volume (“GMV”) as a result of the adjusting of Company business

plan in 2023.

There were no income were generated from Y-Cloud system in Q2 2023 and Q3 2023 respectively.

The decrease in losses were

mitigated by the increase in revenue of our new AI-enabled SAAS business of $1.6 million in Q3 2023.

Liquidity and Capital Resources

As of September 30, 2023, we had cash on hand of $1,419,807.

The decrease is mainly due to the company is strategy to acquire and hold BTC during the period.

There were 833 BTC were acquired for

approximately $25 million in cash, at a locked-in price of $30,000 per bitcoin.

We view our bitcoin holdings as long-term holdings and

expect to continue to accumulate bitcoin.

The Company has option to purchase 6000 bitcoin over 12 months at the lock-in price of $30,000

Operating activities

As of September 30, 2023, our cash flow provided by

operating activities is $8,530,677 for the period ended September 30, 2023 as compared to the cash flow provided by operating activities

of $18,924,761 in prior period, which decreased by approximately of $10.4 million.

The decrease was mainly due to decrease in revenue

and decrease in Y-cloud SAAS services fee received from the customers during the period.

Investing activities

As of September 30, 2023, cash used in investing

activities is $23,375,159 for the period ended September 30, 2023 as compared to the cash flow used in investing activities of $846,023

in prior period.

The increase was mainly due to addition of loan to third party of $5.6 million during the period.

The increase was mainly due to acquire of 833 BTC for the approximately $25 million in cash during the period.

Financing activities

Cash provided by our financing activities was $12,998,841

982,207 for the period ended June 30, 2023 as compared to cash provided by financing activities of $230,832.

The increase is mainly due

to addition advances from shareholders during the period.

does not materially affect our business or the results of our operations.

Sheet Arrangements

do not have any off-balance sheet arrangements.

Accounting Policies

prepare our financial statements in accordance with generally accepted accounting principles of the United States (“GAAP”).

GAAP represents a comprehensive set of accounting and disclosure rules and requirements.

The preparation of our financial statements

requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent

assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting

Our actual results could differ from those estimates.

for the period ended September 30, 2023 as compared to cash provided by financing activities of $37,865,508.

There were only share placement

of approximately $12.6 million as compare to the share placement of $37.5 million in prior period.

Inflation does not materially affect our business

or the results of our operations.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements.

Critical Accounting Policies

We prepare our financial statements in accordance

with generally accepted accounting principles of the United States (“GAAP”).

GAAP represents a comprehensive set of accounting

and disclosure rules and requirements.

The preparation of our financial statements requires management to make estimates and assumptions

that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial

statements, and the reported amounts of revenues and expenses during the reporting period.

Our actual results could differ from those

We use historical data to assist in the forecast of our future results.

Deviations from our projections are addressed when our financials are reviewed on a monthly basis.

This allows us to be proactive in

our approach to managing our business.

It also allows us to rely on proven data rather than having to make assumptions regarding our

Accounting Pronouncements

have reviewed all the recently issued, but not yet effective, accounting pronouncements and we do not believe any of these pronouncements

will have a material impact on the Company financial statements.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

are a “smaller reporting company” as defined by Item 10(f)(1) of Regulation S-K, and as such are not required to provide

the information contained in this item pursuant to Item 305 of Regulation S-K.

Deviations from our projections are addressed when

our financials are reviewed on a monthly basis.

This allows us to be proactive in our approach to managing our business.

It also allows

us to rely on proven data rather than having to make assumptions regarding our estimates.

Recent Accounting Pronouncements

We have reviewed all the recently issued, but not

yet effective, accounting pronouncements and we do not believe any of these pronouncements will have a material impact on the Company

financial statements.

QUANTITATIVE AND QUALITATIVE

DISCLOSURES ABOUT MARKET RISK

We are a “smaller reporting company” as

defined by Item 10(f)(1) of Regulation S-K, and as such are not required to provide the information contained in this item pursuant to

Item 305 of Regulation S-K.

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

Item 2. Management’s Discussion and Analysis