What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-12-23 compared with 2025-09-15 · 136 added, 95 removed, 193 unchanged (54% of the section changed)

11 unchanged sentences

figures and rounded to the nearest whole number .

Company operates through Yuanyu Enterprise Management Co., Limited (“YYEM”), a Hong Kong-based subsidiary established in

November 2021 that is engaged in the emerging love and marriage market sector.

operate through Yuanyu Enterprise Management Co., Limited (“YYEM”), a Hong Kong-based subsidiary established in November

2021 that is engaged in the emerging love and marriage market sector.

mission is to empower global connections through innovative matchmaking technology.

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have license agreements in place with various entities to use the IP in numerous countries across Asia, Europe, and Africa, generating

royalties of $3.0 million in our three months ended July 31, 2025.

February 2025, YYEM entered into an agency agreement to develop content for TikTok across the MENA region, leveraging Twitch-hosted live-streaming

in sports, gaming, and lifestyle categories.

While no upfront payments were received, the agreement positions us to monetize end-user

engagement once our influencer network is developed.

Revenue under this agreement will depend on performance-based conversion metrics,

and as of July 31, 2025, influencer network capabilities were still nascent.

We consider this development a positive step toward the

diversification of our revenue streams.

Private Placement

On June 30, 2025, we executed

a securities purchase agreement to issue 20,000,000 units (each unit comprising one share of common stock and two five-year warrants with

an exercise price of $0.89), targeting gross proceeds of $4.6 million (the “Private Placement”).

Closing was contingent on

Nasdaq listing compliance and shareholder approval.

The warrants allow for cashless exercise if no effective registration is in place.

This financing, when consummated, is anticipated to improve liquidity and capital resources through 2025 and beyond.

On August 19, 2025,

the Company closed the Private Placement, generating gross proceeds of $4,600,000 (without taking into account any exercise of the warrants

included in the Private Placement).

royalties of $6.0 million in the six months ended October 31, 2025.

In January 2025, as part of our efforts to diversify our revenue streams,

we announced the development of a social networking vertical, through which we would provide content to TikTok and similar social media

Our revenue relating to social networking will depend on performance-based conversion metrics.

We expect this business to begin

generating revenue in the current fiscal year.

August 2025, we signed a $500 million joint venture agreement to form AiRWA Exchange, a digital asset exchange focused on the tokenization

of real-world assets (RWA), specifically U.S.

AiRWA Exchange is not yet operational and generating revenue, but we have successfully

completed test runs for settling trades of tokenized U.S.

equities, positioning AiRWA Exchange to offer users the ability to trade digital

representations of U.S.

stocks with the same simplicity and speed as cryptocurrencies — with transactions settled within seconds

and recorded on the blockchain’s immutable ledger, which is accessible 24 hours per day.

We believe AiRWA Exchange will mark a

significant step toward bridging the gap between conventional financial systems and the emerging decentralized economy.

support the development of our AiRWA Exchange, we intend to leverage our commercial relationships, launching our Exchange services to

our JV partner’s millions of users to help scale the Exchange’s operations more quickly, and partnering with a leading

provider of digital asset intelligence and security solutions, to add advanced monitoring, threat detection, and compliance capabilities

for the long-term integrity of the AiRWA Exchange ecosystem.

change of name to AiRWA, Inc.

reflects our intention to make AiRWA Exchange core to our business and to focus on our goal of enhancing

global access to tokenized financial products.

and Corporate Developments

August 19, 2025, we completed a private placement, issuing 20,000,000 units (each unit comprising one share of common stock and two five-year

warrants with an exercise price of $0.89 and cashless exercise if no effective registration is in place), which raised gross proceeds

of $4,600,000, without taking into account any exercise of the warrants.

a prospectus supplement dated August 22, 2025 that amends the prospectus supplement dated June 11, 2025 and its accompanying prospectus

dated June 11, 2025, filed with the Securities and Exchange Commission as part of our registration statement on Form S-3 (File No.

(the “Registration Statement”) relating to the offer and sale of our common stock through A.G.P./Alliance Global Partners

(“A.G.P.”) in “at the market offerings” (the “ATM facility”) as defined in Rule 415 promulgated under

the Securities Act of 1933, as amended, pursuant to the sales agreement with A.G.P.

dated as of January 8, 2025 (the “Sales Agreement”),

the amount we could raise under our ATM facility was specified to be $200 million.

No shares had been sold through this facility as of

July 31, 2025, but the agreement provides strategic flexibility for future capital raising.

On August 25, 2025, the Company

and JuCoin Capital Pte Ltd (“JuCoin”) signed an agreement (the “JV Agreement”) to jointly establish a joint venture

company (the “JV”) to found and operate a new cryptocurrency exchange (the “Joint Venture”) within 120 days of

the JV Agreement.

At the closing of the Joint Venture, each of the Company and JuCoin will contribute $250 million in cash or cryptocurrency.

In exchange, the JV will issue 51% of its share capital to the Company and 49% to JuCoin.

The Company will appoint three of the five

members of the board of directors of the JV, though certain material decisions will require the approval of both parties.

The JV Agreement

may be terminated if the closing of the JV Agreement has not occurred within six months of signing, by mutual agreement of the parties,

or if the transaction becomes prohibited by applicable law.

relating to the offer and sale of our common stock through A.G.P./Alliance Global Partners (“A.G.P.”) in “at the market

offerings” (the “ATM facility”) as defined in Rule 415 promulgated under the Securities Act of 1933, as amended, pursuant

to the sales agreement with A.G.P.

dated as of January 8, 2025, the amount we could raise under our ATM facility was specified to be

$200 million.

As of December 15, 2025, we had sold 21,775,662 shares (adjusted for the Reverse Stock Split) and raised $177,099,426

following payment to the Placement Agent of 3% of the gross proceeds and certain other expenses.

October 22, 2025, we entered into a share purchase agreement with Mr.

Zhou, the Chairman of the Company, to acquire from him the 30%

of the share capital of our YYEM operating subsidiary that we did not already own for $36,000,000, payable in cash.

on October 22, 2025, we filed a Certificate of Amendment to our Certificate of Incorporation with the Secretary of State of the State

of Delaware to effect a reverse stock split of the Common Stock at a ratio of 1-for-50 (the “Reverse Stock Split”), which

became effective on October 27, 2025.

of Results of Operations

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fees for external legal, accounting, and other consulting services;

traveling expenses;

travel expenses;

and other general office and administrative expenses.

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of Operations

months ended July 31, 2025, compared to the three months ended July 31, 2024

following are the results of our operations for the three-month period ended July 31, 2025, as compared to the three-month period ended

July 31, 2024:

Three Months Ended July 31,

Cost of Revenue

Six months ended, and three months ended, October 31,

2025 compared to the six months ended, and three months ended, October 31, 2024

following are the results of our operations for the six-month period ended, and the three-month period ended, October 31, 2025, as compared

to the corresponding periods a year earlier:

and Marketing Expenses

and Administrative Expenses

Operating Expenses

General and Administrative Expenses

Total Operating Expenses

Operating Income

revenue decreased by $0.3 million, or 8%, from $3.3 million for the three-month period ended July 31, 2024 to $3.0 million for the three-month

period ended July 31, 2025, which was attributable to a minor timing difference resulting from the dates on which the various license

agreements were signed.

revenue decreased by $0.5 million, or 8%, from $6.5 million for the six-month period ended October 31, 2024 to $6.0 million for the six-month

period ended October 31, 2025, Our revenue decreased by $0.3 million or 8.0% from $3.2 million for the three- month period ended October

31, 2024 to $3.0 million for the three-month period ended October 31, 2025 which was attributable to a minor timing difference resulting

from the dates on which the various license agreements were signed

cost of revenue did not change because it consists of the amortization of our IP intangible assets, which remained constant.

Selling and Marketing Expenses

Our selling and marketing expenses were

$0.5 million in the six-month and three-month periods ended October 31, 2025 as we began amortizing agent fees in relation to the Company’s

previously announced TikTok advertising business.

and Administrative Expenses

and administrative expenses, which mainly consist of salaries, professional fees, and other general office and administrative expenses,

increased by $0.7 million, from $0.1 million to $0.8 million, primarily driven by higher costs relating to YYEM becoming an operating

subsidiary of a Nasdaq-listed company, which occurred in November 2024.

This included audit fees, legal fees, insurance premiums, and

and administrative expenses, which mainly consist of salaries, professional fees, and other general office and administrative

expenses, increased by $2.2 million, from $0.3 million to $2.5 million, for the six-month period ended October 31, 2025 compared

with the same period a year earlier.

These expenses increased by $1.55 million, from $0.2 million to $1.75 million, for the

three-month period ended October 31, 2025 compared with the same period a year earlier.

These increases were primarily driven by

higher costs relating to YYEM becoming an operating subsidiary of a Nasdaq-listed company, which occurred in November 2024, between

the two comparison periods.

These costs included audit fees, investor relations consulting fees, legal fees, insurance premiums, and

directors’ and officers’ compensation.

and Capital Resources

finance our operations primarily through cash generated from operations.

We had working capital, or net current assets, of $17.9 million

as of July 31, 2025, compared to $15.9 million as of April 30, 2025, an increase of approximately $2.0 million, or 13%.

In comparison

with April 30, 2025, our accounts receivable as of July 31, 2025, increased by $3.0 million as we recognized royalty revenue for the quarter

in accordance with our recognition policy while the credit terms of our licensees permit payment up to 90 days after the end of our financial

As of July 31, 2025, we had retained earnings of $7.0 million.

following is a summary of our cash flows from operating, investing, and financing activities for the three-month periods ended July 31,

We finance our operations

primarily through cash generated from financing activities.

We had working capital, or net current assets, of $156.0 million as of

October 31, 2025, compared to $15.9 million as of April 30, 2025, an increase of approximately $140.5 million, or 884%.

comparison with April 30, 2025, our accounts receivable as of October 31, 2025, decreased by $3.0 million as a result of collections

from a major customer during the quarter.

The reduction was driven by the receipt of payments on outstanding invoices and reflects

normal fluctuations in working capital related to the timing of billings and collections.

As of October 31, 2025, we had retained

earnings of $27 million.

cash and cash equivalents increased by about $105.45 million, from $0.05 million as of April 30, 2025 to $105.5 million as of October

31, 2025, because of the settlement of accounts receivable and as a result of the funds we raised under our ATM facility, as described

following is a summary of our cash flows from operating, investing, and financing activities for the six-month periods ended October

31, 2025 and 2024:

Three Months Ended July 31,

Cash Flow Used in Operating Activities

Months Ended October 31,

(Used in)/Provided by Operating Activity

$ (31,889,74 6 )

Cash Flow Provided by Financing Activities

Our cash and cash equivalents

were relatively steady, at approximately $0.5 million as of July 31, 2025 and 2024.

cash used in operating activities was $1.08 million for the three-month period ended July 31, 2025, compared with $0.6 million for the

same period in the prior year, a decline of $0.5 million in operating cash flow.

This change was driven primarily by a $0.7 million increase in general and administrative expenses relating to YYEM

becoming an operating subsidiary of a Nasdaq-listed company, as explained in greater detail above.

our cash level was low in the period before payment from our licensees was due, we had no cash allocated to investing activities, neither

putting cash into investments nor receiving cash from investments.

only cash flow we recorded as financing activities was a non-cash item:

a $1.1 million decline in the value of a guarantee given to the

Company by our Chairman in respect of listed shares we own as the shares increased in value over this period.

(As the deficit in the shares’ value declined, the size of the guarantee required to provide the Company with

value equal to the shares’ value at the time of contribution also declined.)

$ (32,067,894 )

Cash Flow Used in Investing

(36,000,000 )

Cash Flow Provided by

Financing Activities

$ 173,343,151

$ 172,927,083

cash used in operating activities was $31.9 million for the six-month period ended October 31, 2025, compared with $0.2 million of net

cash provided by operating activities for the same period in the prior year, a decline of $32.1 million in operating cash flow.

change was driven primarily by deposits, prepayments and other receivables, namely a $377 million decline in net current assets as a

result of higher deposits and prepayments made in connection with new business activities and advance payments for services and rental

These amounts required cash outflows during the period, which were recorded as reductions of assets rather than as current

As a result, these deposits and prepayments reduced operating cash flow, with the related expenses being recognized

in future periods.

cash provided by operating activities was approximately $0.18 million for the six months ended October 31, 2024.

Net income of

approximately $3.9 million was largely offset by the combined effects of a $4.2 million increase in accounts receivable resulting

from delayed payments from customers, which negatively affected operating cash flow, and a $1.8 million decrease in other

receivables due to collections received during the period, which partially mitigated the increase in accounts receivable.

cash flow used in investing activity for the six-month period ended October 31, 2025 consisted of the $36.0 million purchase of all

of the shares of our operating subsidiary that we did not already own, as more fully described above.

The Company did not engage in

any investing activities during the six-month period ended October 31, 2024.

flow provided by financing activities rose by approximately $173.3 million for the six-month period ended October 31, 2025, as a

result of private placement proceeds and the receipt of funds raised under our ATM facility.

Net cash provided by financing

activities during the six-month period ended October 31, 2024 reflected changes in related-party balances, including an increase in

amounts due to related parties and a decrease in amounts due from related parties, representing financing support and collections

received during the period.

on our current operating plans, we believe that our existing cash at the time of this filing will be sufficient to meet our anticipated

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Our future capital requirements will

depend upon many factors, including competing technological and market developments, our R&D efforts, and decisions regarding acquisitions

of further patents or companies or other assets.

depend upon many factors, including competing technological and market developments, the development of our plans in respect of our AiRWA

Exchange, and decisions regarding acquisitions.

Balance Sheet Arrangements

do not have any off balance sheet arrangements that have or are reasonably likely to have a material current or future effect on our

financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditure, or

capital resources that are material to investors.

financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditure, or capital

resources that are material to investors.

Accounting Policies

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the financial asset to present the net carrying value at the amount expected to be collected on the financial asset.

Company considers various factors, including the nature, historical collection

experience, age of the accounts receivable balances,

credit quality and specific risk characteristics of its customers, and current economic conditions to develop an estimate of credit losses.

Company considers various factors, including historical collection experience, the age of the accounts receivable balances, the credit

quality and specific risk characteristics of its customers, and current economic conditions, to develop an estimate of credit losses.

Additionally, the Company makes specific allowance for credit losses based on any specific knowledge the Company has acquired that might

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After all attempts to collect a receivable have failed, the receivable is written off against the allowance.

As of July 31, 2025 and April 30, 2025, the Company had made no reserves.

As of October 31, 2025 and April 30, 2025, the Company had made no reserves.

of long-lived assets

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Impairment charge recognized

for the three months ended July 31, 2025 and 2024 was nil.

for the six months ended October 31, 2025 and 2024 was nil.

value of financial instruments

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it would transact, and it also considers assumptions that market participants would use when pricing the asset or liability.

represents the amount of consideration the Company is entitled to upon the transfer of promised goods or services in the ordinary

course of the Company’s activities and is recorded net of VAT.

The Company has adopted the following five steps for revenue recognition:

(i) identify the contracts with a customer, (ii) identify the performance obligations in the contract, (iii)

determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract and (v)

recognize revenue when (or as) the entity satisfies a performance obligation.

represents the amount of consideration the Company is entitled to upon the transfer of promised goods or services in the ordinary course

of the Company’s activities and is recorded net of VAT.

The Company follows five steps for the revenue recognition:

the contracts with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv)

allocate the transaction price to the performance obligations in the contract and (v) recognize revenue when (or as) the entity satisfies

a performance obligation.

with the criteria of ASC 606, Revenue from Contracts with Customers, the Company recognizes revenue when performance obligations

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on its financial position, results of operations, or cash flows.

September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other (Topic 350):

Internal-Use Software .

simplifies the accounting for internal-use software costs and is effective for fiscal years beginning after December 15, 2026.

does not expect adoption of this standard to have a material impact on its financial statements.

December 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2025-11,

Interim Reporting (Topic 270):

Improvements to Interim Disclosure Requirements .

The standard clarifies disclosure requirements

for interim financial statements and is effective for interim periods beginning after December 15, 2026.

Early adoption is permitted.

The Company is currently evaluating the impact of this guidance on its condensed consolidated financial statements.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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