CIMG 10-K & 10-Q changes, risk factors and insider trading

We have incurred net losses since our inception in 2013, including net losses of $8.56$4.89 million and $8.75$8.97 million for the fiscal years ended September September 30, 2024,2025, and 2023,2024, respectively. As of September 30, 2024,2025, our accumulated deficit was approximately $81.93$87.23 million. We expect to incur significant sales and marketing expenses, as well as costs associated with operating as an exchange-listed public company, prior to recording sufficient revenue from our operations to offset these expenses.

These losses have had, and will continue to have, an adverse effect on our working capital, total assets and stockholders’ equity. Our ability to become and remain profitable will depend on our ability to generate significantly higher revenues from the sales of ourthe Homology single-service coffeeof products,Medicine and Food Series and Maca seriesSeries products, etc., which depends upon a number of factors, including but not limited to successful sales, manufacturing, marketing and distribution of our products and services.

Because of the numerous risks and uncertainties associated with our commercialization efforts, we are unable to predict when we will become profitable, and we may never become profitable. Even if we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis. Our inability to achieve and then sustain profitability would have a material adverse effect on our business and financial condition.

Considering our current cash resources and our current and expected levels of operating expenses for the next twelve months, we expect to need additional capital to fund our planned operations for at least the next twelve months. This evaluation is based on relevant conditions and events that are currently known or reasonably foreseeable. A reduction in consumer demand for, or revenues from the sale of, our macaproducts related productscould could further constrain our cash resources.

We intend to seek to raise additional capital through public or private equity offerings. However, we may not be able to raise such additional capital on favorable terms or at all. If we are unsuccessful in efforts to raise additional capital, based on our current levels of operating expenses, our current capital is not expected to be sufficient to fund our operations for the next twelve months. These conditions raise substantial doubt about our ability to continue as a going concern.

Our future financial results are difficult to predict, and failurethe toearly meetstage marketof expectationscommercialization forof our financialcurrent performanceproduct or any publicly announced guidancelines may cause our operating results to fluctuate and may adversely affect the price of our stock to decline.securities.

AsAny we and our industry evolve, we expect to face new challenges with respect to our introduction of innovative products and the changing competitive landscape within the maca products industry. These challenges can occur at various stages, including design, supply chain and sales cycle. Any public forecasts regarding the expected performance of our business and future operating results are forward-looking statements subject to risks and uncertainties, including the risks and uncertainties described in our filings with the SEC and in our other public statements, and necessarily reflect current assumptions and judgments that may prove incorrect. As a result, there can be no no assurance that our performance will be consistent with any public forecasts or that any variation from such forecasts will not be material material and adverse. Failure to meet expectations, particularly with respect to operating margins, earnings per share, operating cash flows, flows and net revenuesrevenue, may result in a decline and/or increased volatility in the trading price of our stock.Common Stock. In addition, broad price and volume fluctuations in the stock market as a whole, as well as general economic, businessbusiness, and political conditions, may adversely affect the trading price of our stockCommon Stock in ways that may be unrelated to our financial performance.

Our international sales and operations subject us to variouscomplex additional legal, regulatory, financiallegal and otherregulatory risks.requirements, including requirements relating to product labeling and marketing claims, and non-compliance could adversely affect our business.

Our business, growthgrowth, and profitability depend on the performance of third-parties and our relationship with them.

In connection with the distribution of macaMaca products, we rely on third-party suppliers and manufacturing partners to provide high quality macaMaca products. We also rely on our manufacturing partners to provide us with additional manufacturing and facilitate distribution efforts throughout China. Our reliance on third-party suppliers and manufacturing partners subjects us to additional risks, including the possible termination of the arrangement by a third-party supplierssupplier or manufacturing partner at a time that is costly or inconvenient for us. Our third-party suppliers and manufacturing partners are independent entities subject to their own unique operational and financial risks that are out of our control. If any of these third-party suppliers or manufacturing partners fail to perform as required, this could cause delays in our receipt of the macaMaca products or otherwise adversely affect our business.

In addition, a significant portion of our distribution network, and correspondingly our success in distributing our macaMaca products, depends on the performance of third-parties.third parties. Any non-performance or deficient performance by such parties may undermine our operations and profitability. For distribution of our macaMaca products, we typically rely on third partythird-party distribution networks, including freight companies and common carriers. The success of these distribution networks depends on the performance of brokers, distributors, common carriers and retailers, as well as our third-party manufacturing partners as itthey relatesrelate to the distribution of certain of our products. There is a risk that a broker, distributor, common carrier or retailer may refuse to or cease to market or carry our product,products, or that any such entity or our third-party manufacturing partner may not adequately perform its functions within the network by, without limitation, failing to distribute our products.

Our success depends on the skills, experience and performance of key members of our senior management team. The individual and collective efforts of our senior management team will be important as we continue to expand our commercial activities and develop additional products. The loss or incapacity of existing members of our senior management team could have a material adverse effect on our business and financial condition if we experience difficulties in hiring qualified successors. Our employment agreements with our executive officers are “at willwill,”, and the retention of our executive officers for any period of time cannot be guaranteed. We do not maintain “key person” insurance on any of our employees.

Due to the specialized nature of the business and our small size, we are highly dependent upon our ability to attract and retain qualified sales and marketing, technical and managerial personnel. The loss of the services of existing personnel, as well as the failure to recruit key sales, marketing, technical and managerial personnel in a timely manner would be detrimental to our development and could have a material adverse effect on our business and financial condition. Our anticipated growth and expansion into areas and activities requiring additional expertise, such as sales and marketing, may require the addition of new management personnel, both domestic and international. All of our employees may terminate their employment at any time with short or no advance notice. We may have difficulties locating, recruiting or retaining qualified sales people.personnel. Recruiting and retention difficulties will limit our ability to support our development and sales programs and to build a commercially viable business.

The competition for talent is currently extremely high. In this competitive environment, our business could be adversely impacted by increases in labor costs, including wages and benefits, including those increases triggered by regulatory actions regarding wages, scheduling and benefits; increased health care and workers’ compensation insurance costs; increased wages and costs of other benefits necessary to attract and retain high qualityhigh-quality employees with the right skill sets,sets; and increased wages, and benefitsbenefits, and other costs. In addition, our wages and benefits programs, combined with the periodic challenges in the labor market, may be insufficient to attract and retain talent.

As part of our strategy to attract the most qualified individuals, we do not require the members of our management team to relocate to a particular geographic area. Accordingly, the members of our management team are geographically dispersed. This decentralized structure might cause additional expenses in the conduct of our business, and may also delay communication between members of our management team, lower the quality of our management decisionsdecisions, or decrease our ability to take action quickly.

We expect for the foreseeable future to experience inflationary pressure on our cost structure.structure for the foreseeable future. We may be able to pass some or all of our raw materials, energy and other input cost increases to customers by increasing the selling prices of our products or decreasing the size of our products; however, higher product prices or decreased product sizes may also result in a reduction in sales volume and/or consumption. If we are not able to mitigate these inflationary pressures, such as by increasing our selling prices or reducing product sizes sufficiently to offset increased raw material, energy or other input costs, including but not limited to packaging, direct labor, overhead and employee benefits, or if our sales volume decreases significantly, there could be a negative impact on our results of operations and financial condition.

While we are currently a small company and, therefore, limited in our product development, marketing and sales activities, we anticipate continued growth in our business operations commensurate with the expansion of our sales and support operations and distribution network and the commercialization of our coffee products. Any future growth could impose significant added responsibilities on members of our existing management and create strain on our organizational, administrative, and operational infrastructure, including sales and marketing, quality control, and customer service. Our ability to manage our growth properly will require us to continue to improve our operational, financial and management controls, as well as our reporting systems and procedures, which in the past have been determined to be inadequate. Our status as an exchange-listed public company will require us to increase our investment in financial accounting and reporting. If our current infrastructure is unable to handle our growth, we may need to expand our infrastructure,infrastructure to identify and recruit new staff and to implement new reporting systems. The time and resources required to implement such expansion and systems could adversely affect our operations. Our future financial performance and our ability to expand and market our single-serve coffee products and to compete effectively will depend, in part, on our ability to manage this potential future growth effectively, without compromising quality.

There is inherent risk in forecasting demand due to the uncertainties involved in assessing the current level of maturity of the single-serve single serve component of our business as well as the current and future needs of our customers. We will set targetthe levelsproduction and procurement targets for the manufactureproducts ofbefore receiving the customer orders. These targets will be based on our coffeepredictions of productscustomer andneeds foras well as the purchase of coffee in advance of customer orders based upon our forecasts of customer demand and thosepredictions of our business partners. If our forecasts exceed demand, we could experience excess inventory in the short-term, excess manufacturing capacity in the short and long-term, and/or price decreases, all of which could impact our financial performance. Alternatively, if the demand exceeds our forecasts significantlyis beyond our current manufacturingproduction capacity,and procurement capabilities, we may not be able to satisfy customer demand, which could result in a loss of share if our competitors are able to meet customer demands. A failure to accurately predict the level of demand for our products could adversely affect our net revenues and net income.

Our success depends in part upon our intellectual property rights. We rely primarily on trademark, trade secret laws, confidentiality procedures, license agreements and contractual provisions to establish and protect our proprietary rights over our products, procedures and services. Other persons could copy or otherwise obtain and use our intellectual propertiesproperty without authorization or create intellectual propertiesproperty similar to ours independently. We may also pursue the registration of our domain names, trademarks and service marks in other jurisdictions, including the United States. However, we cannot assure you that we will be able to protect our proprietary rights. Further, our competitors may be able to independently develop similar intellectual property, duplicate our products and services or design around any intellectual property rights we hold. Further, our intellectual property rights may be subject to termination or expirations.expiration. The loss of intellectual property protections or the inability to timely regain intellectual property protections could harm our business and ability to compete.

Part of our operations are conducted in the PRC. Although the PRC economy has grown significantly in recent years, there is no assurance that this growth will continue. A slowdown in overall economic growth, an economic downturn, a recessionrecession, or other adverse economic developments in the PRC could significantly reduce the demand for our products and services.

AtIn various times during recent years, the United States and China have had significant disagreements over political and economic issues. Controversies may arise in the future between these two countries that may affect our business and economic outlook in both in the United States and in China. Any political or trade controversies between the United States and China, whether or not directly related to our business, could reduce the price of our Common Stock.

In recent years, the Chinese economy has experienced periods of rapid expansion and high rates of inflation. Rapid economic growth can lead to growth in the money supply and rising inflation. If prices for our services and products rise at a rate that is insufficient to compensate for the rise in the costs of supplies, it may have an adverse effect on our profitability. These factors have led to the adoption by the Chinese government, from time to time, of various corrective measures designed to restrict the availability of credit or regulate growth and contain inflation. High inflation may in the future cause the Chinese government to impose controls on credit and/or prices, or to take other action, which could inhibit economic activity in China, and thereby harm the market for our services and products.

The change in value of the Renminbi against the U.S. dollar and other currencies is affected by, various factors, such as changes in China’s political and economic conditions and China’s foreign exchange controls. On July 21, 2005, the PRC government changed its decade-old policy of pegging the value of the Renminbi to the U.S. dollar. Under such policy, the Renminbi was permitted to fluctuate within a narrow and managed band against a basket of certain foreign currencies. Later on, the People’s Bank of China has decided to further implement the reform of the RMB exchange regime and to enhance the flexibility of RMB exchange rates. Such changes in policy have resulted in a significant appreciation of the Renminbi against the U.S. dollar since 2005. There remains significant international pressure on the PRC government to adopt a more flexible currency policy, which could result in a further and more significant adjustment of the Renminbi against the U.S. dollar. Any significant appreciation or revaluation of the Renminbi may have a material adverse effect on the value of, and any dividends payable on, shares of our Common Stock in foreign currency terms. More specifically, if we decide to convert our Renminbi into U.S. dollars, appreciation of the U.S. dollar against the Renminbi would have a negative effect on the U.S. dollar amount available to us. To the extent that we need to convert U.S. dollars we receive from our 2018 offering into Renminbi for our operations, appreciation of the Renminbi against the U.S. dollar would have an adverse effect on the Renminbi amount we would receive from the conversion. In addition, appreciation or depreciation in the exchange rate of the Renminbi to the U.S. dollar could materially and adversely affect the price of shares of our Common Stock in U.S. dollars without giving effect to any underlying change in our business or results of operations.

Part of our revenue is denominated in Renminbi. As a result, restrictions on currency exchange may limit our ability to use revenue generated in Renminbi to fund any business activities we may have outside China in the future or to make dividend payments to our shareholders in U.S. dollars. Under current PRC laws and regulations, Renminbi is freely convertible for current account items, such as tradetrade- and service-related foreign exchange transactions and dividend distributions. However, Renminbi is not freely convertible for direct investment or loans or for investments in securities outside China, unless such use is approved by SAFE. For example, foreign exchange transactions under the subsidiary’s capital account, including principal payments in respect of foreign currency-denominated obligations, remain subject to significant foreign exchange controls and the approval requirement of SAFE. These limitations could affect our ability to convert Renminbi into foreign currency for capital expenditures. And theThe Chinese government is further strengthening the control of foreign exchange; controls, and we willmay not be able to changeinfluence thesuch Chinese government’s decision in our own power.decisions.

CIMG Inc. is a company incorporated in Nevada and has been listed on Nasdaq since June 2020. We were formerly known as “Nuzee, Inc.” with with a previous ticker symbol “NUZE”, and we changed our corporate name and ticker symbol to “CIMG Inc.” and “IMG” in October 2024. We previouslyare focusedcommitted onto specialtyleveraging coffeeartificial intelligence and, where appropriate, blockchain related technologies to support industrial development and relatedhelp technologiesour butclients improve user growth and brand management. We are nowcurrently expandingmaking efforts to expand our sales and distribution channels in Asia to encompasscover a broaderwider range of consumer food and beverage products. This expansion is fueleddriven by our online sales platform, which leveragesutilizes athe natural language search function.

Maca, a plant of the Brassicaceae family that originated in South America, has oval leaves and a rootstock shaped like a small round radish. It is edible and renowned as a natural superfood. Maca is rich in nutrients, boasts high levels of essential nutrients, and is believed to nourish and strengthen the human body. It is often referred to as “South American ginseng.” The primary cultivation regions for macaMaca include the Andes Mountains in South America and the Jade Dragon Snow Mountain in Lijiang, Yunnan, China. Our business focuses on sourcing, marketing, and distributing a wide range of Maca-based dietary supplements, functional foods, and beauty products. We operate with a commitment to providing high-quality, sustainably sourced products to consumers who seek to enhance their health and wellness. Our products are sold through both online channels and a network of retail partners, including grocery stores, convenience stores, and vending machines.

CIMGWe source, market, and distribute health aimsand to become a leading distributor of premium macawellness products, aincluding natural superfood known for its numerous health benefits. Our business focuses on sourcing, marketing, and distributing a wide range of maca-basedMaca-based dietary supplements, functional foods, and beauty products. We operateleverage technology and data-driven marketing tools to support product promotion and sales. We are committed to providing high-quality products with a commitmentfocus toon providingresponsible and high-quality,sustainable sustainably sourced productssourcing to consumers who seekseeking to enhance their health and wellness. OurWe sell our products are sold through both online channels and a network of retail partners, including grocery stores, convenience stores, and vending machines.

Since January 2024, we have received several deficiency and delinquency notices from Nasdaq relating to our stockholders’ equity, minimum bid price, failure to timely file periodic reports and failure to hold an annual meeting. We have cured all of these deficiencies except the minimum bid price requirement and, as of December 4, 2025, Nasdaq has notified us that we have regained compliance with Nasdaq Listing Rules 5250(c)(1), 5550(b)(1) and 5620(a), while remaining subject to a bid price compliance deadline under Rule 5550(a)(2) and a Mandatory Panel Monitor through November 14, 2026 On January 14, 2025, the Company received a notification letter (the “Minimum Bid Price Notice”) from the Listing Qualifications Department of The Nasdaq Stock Market LLC indicating that the Company iswas not in compliance with the minimum bid price requirement for continued listing set forth in Nasdaq Listing Rule 5550(a)(2). Nasdaq Listing Rule 5550(a)(2) requires listed securities to maintain a minimum bid price of $1.00 per share, and Nasdaq Listing Rule 5810(c)(3)(A) provides that a failure to meet the minimum bid price requirement exists if the deficiency continues for a period of 30 consecutive business days. The Minimum Bid Price Notice hashad no immediate effect on the listing of the Company’s Common Stock, which continuescontinued to trade on The Nasdaq Capital Market under the symbol “IMG.” In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company hashad 180 calendar days from the date of the Minimum Bid Price Notice, or until July 14, 2025, to regain compliance. IfIf, at any time before July 14, 20252025, the closing bid price of the Common Stock closesclosed at at or above $1.00 per share for a minimum of 10 consecutive business days, NASDAQNasdaq willwould provide written notification that the Company had has achievedregained compliance with the minimum bid price requirement, and the matter willwould be resolved. If the Company doesdid not regain compliance during the compliance period ending July 14, 2025, thenNasdaq NASDAQ maycould, in its discretion determine todiscretion, grant the Company an additional 180 calendar day180-calendar-day period to regain compliance, provided that the Company on July 14, 2025 meetsmet the continued listing requirement for market value of publicly held shares and all other applicable initial listing standards for The Nasdaq Capital Market,Market with the exceptionas of July 14, 2025 (except for the minimum bid price requirement,requirement) and willprovided needNasdaq to provide NASDAQwith written notice of its intent to cure the deficiency during the second compliance period.

On January 17, 2025, the Company received another notice (the “Annual Report Notice”) from NASDAQNasdaq indicating that the Company iswas not in compliance with Nasdaq Listing Rule 5250(c)(1) because the Company did not timely file its Annual Report on Form 10-K for the the periodfiscal year ended September 30, 2024 with the SEC. The Annual Report Notice hashad no immediate effect on the listing of the Company’s stockCommon Stock on Nasdaq,Nasdaq and it statesstated that the Company iswas required to submit a plan to regain compliance with Nasdaq Listing Rule 5250(c)(1) within 60 calendar days from the date of the Annual Report Notice. If the plan iswas accepted by Nasdaq, then Nasdaq cancould grant the Company up to 180 calendar days from the due date of the Form 10-K for the fiscal year ended September 30, 20252024 to regain compliance. In determining whether to accept such plan, Nasdaq willwould consider factors such things as the likelihood that the remedial filing, along with any subsequent periodic periodic filingfilings that will bebecame due, cancould be made within the 180 day180-day period, the Company’s past compliance history, the reasons for the late filing, other corporate events that maymight occur withinduring ourNasdaq’s review period, the Company’s overall financial condition condition, and its public disclosures. Any subsequent periodic filing that is due within the 180-day exception period mustwas required to be filed no later than the end of the that period.

On February 19, 2025, the Company received a notification letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC indicating that the Company iswas not in compliance with Nasdaq Listing Rule 5250(c)(1) because the Company did not timely file its quarterlyQuarterly Report report on Form 10-Q for the period ended December 31, 2024 with the SEC.

WeThe haveCompany submitted a Nasdaq compliance plan to Nasdaq on March 18, 20252025, and Nasdaq grantgranted the Company an extension to (i) file theits Form 10-K for the periodfiscal year ended September 30, 2024 on or before June 13, 2025;2025, and (ii) file theits Form 10-Q for the periodquarter ended December 31, 2024 2024 on or before July 14, 2025.

On May 19, 2025, the Company received a notice (the “Quarterly Report Notice”) from NASDAQNasdaq indicating that the Company was not in compliance with Nasdaq Listing Rule 5250(c)(1) because the Company did not timely file its Quarterly Report on Form 10-Q for the periodthree months ended March 31, 2025 with the Securities and Exchange Commission.SEC. The Quarterly Report Notice hashad no immediate effect on the listing of the Company’s stockCommon Stock on Nasdaq.

As a result of this additional delinquency ofrelating to the Form 10-Q for the periodthree months ended March 31, 2025, the Company submitted an update to its original plan to regain compliance with respect to the filing requirementplan on June 3, 2025.

On June 13, 2025, the Company did not manage to file its Form 10-K for the fiscal year ended September 30, 20242024. andOn June 27, 2025, the Company received a delistdelisting determination letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC on(the June 27, 2025 (“Nasdaq Delist Determination Letter”). According to the Nasdaq Delist Determination Letter, unless the Company requestsrequested an appeal of this determination by July 7, 2025, trading of the Company’s commonCommon stockStock willwould be suspended from The Nasdaq Capital Market at the opening of business on July 9, 2025, and NSADAQNasdaq will would file a Form 25-NSE with the SEC to remove the Company’s securities from listing and registration on The Nasdaq Stock Market.

Cost of salesrevenue and gross margin

To date,As weof havethe date of this Report, the Company has funded ourits operations primarily withthrough proceeds from registered public offerings and private placements of sharesits of our Common Stock. OurThe Company’s principal use uses of cash isinclude to fund ourfunding operations, which includes theproduct commercialization ofand ourdevelopment products, the continuation of efforts to improve our products,activities, administrative support of our operationssupport, and other working capital requirements.

In addition to the other information set forth in this Report, you should carefully consider the risk factors discussed in “Item 1A—Risk Factors” in our Annual Report on Form 10-K, filed with the SEC on February 13, 2026, as well as the risk factors included in our Registration Statement on Form S-1, as amended, most recently filed with the SEC on AprilJune 29,12, 2026 (File No. 333-294624), which could affect our business, financial condition, or operating results. The risks described in our annual, quarterly, and registration statement filings with the SEC are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially and adversely affect our business, financial condition, or operating results. For the three months ended MarchJune 31,30, 2026, we were not aware of any new and additional risk factors that were not previously disclosed.

Since July 2024, we launched the “Homology of Medicine and Food” series including Huomao-branded products, exosome eye drops and other health and wellness products. The Homology of Medicine and Food Series is guided by traditional Chinese medicine theory, incorporates modern nutritional principles to identify the functional attributes of certain foods and food-derived ingredients. We are committed to providing healthier and more suitable health and wellness products for Asian customers. The launch of the new product effectively contributed to the growth of our sales.

In the fourth quarter of the fiscal year ended September 30, 2024, we launched our health-focused product line in Asia, the Maca Series. Maca, a plant native to South America and a member of the Brassicaceae family, is known for its nutritional value and adaptogenic properties. Often referred to as “South American ginseng,” Maca is prized for its ability to support stamina, vitality, and overall wellness. It is primarily cultivated in the Andes Mountains in South America, and Jade Dragon Snow Mountain in Yunnan Province, China.

In the fourth quarter of 2025, we expanded our product offerings in Asia to include The Homology of Medicine and Food Series, including Huomao-branded products, exosome eye drops, and other health and wellness products. We expanded our sales channels and diversified our product portfolio through the acquisition of subsidiaries, enabling us to offer Asian customers a broader range of health and wellness products. For example, we acquired Shanghai Huomao, which provided us with Huomao-branded products such as Huomao liquor. The Homology of of Medicine and Food Series is guided by traditional Chinese medicine theory, incorporates modern nutritional principles to identify the the functional attributes of certain foods and food-derived ingredients. We do not offer medical products or provide medical advice; rather, rather, we are committed to providing healthier and more suitable health and wellness products for Asian customers.

On March 4, 2026, the Company received a written notice from Nasdaq that the Panel had determined to delist the Company’s Common Stock from The Nasdaq Stock Market due to the Company’s failures to comply with Nasdaq Listing Rules 5550(a)(2), 5250(c)(1), 5550(b)(1), and 5620(a). Trading in the Company’s Common Stock on Nasdaq was suspended at the open of trading on March 6, 2026. The Company has appealed the Panel’s decision to request that the Nasdaq Listing and Hearing Review Council review the Panel’s decision. There can be no assurance that any such appeal will be successful. If the appeal is unsuccessful, Nasdaq is expected to file a Form 25 with the SEC to remove the Company’s Common Stock from listing and registration on The Nasdaq Stock Market. As of the date of this Report, the appeal process is still ongoing.

On March 6, 2026, the Company received a letter from the Department of Market Operations of the Financial Industry Regulatory Authority, Inc. Inc. (“FINRA”), dated March 5, 2026, notifying the Company that the symbol “CIMG” had been assigned to the Common Stock.Stock Asfor ofquotation March 6, 2026,in the OTC Markets. The Company’s Common Stock mayis becurrently quoted and traded inon the over-the-counterOTC marketMarkets under the symbol “CIMG.”

Results of Operations (comparison of the three months ended MarchJune 31,30, 2026 and 2025)

For the three months ended MarchJune 31,30, 2026, the Homology of Medicine and Food Series, Computing Power Product Series, and Maca Product Series Series generated revenues of $428,786,$15,464, $2,649,785,$2,046,930, and $136,420 respectively,$108,936, accounting for 13.34%,0.71%, 82.42%,94.27%, and 4.24%5.02% of the total revenue. Our total revenue was $3,214,991$2,171,330 for the three months ended MarchJune 31,30, 2026 and it was $nil$61,578 for the three months ended March 31,June 30, 2025. The significant increase in revenue was mainly due to the sale of maca inventory and the additional revenue generated by the new medical and food homology product series as well as the computing power product series.

For the three months ended MarchJune 31,30, 2026, thecost totalof sales costrevenue was $3,201,338.$2,170,753, Forcompared to $56,445 for the three months ended MarchJune 31,30, 2025, therepresenting an totalincrease sales costof was$2,114,308, $nil.or 3,745.78%. The significant increase in the cost of revenue was mainly due to the corresponding cost growth of the Maca series products and the inclusion of costs from the newly launched Homology of Medicine and Food Series and the Computing Power Product Series.

For the three months ended MarchJune 31,30, 2026, the total operating expenses amounted to $1,337,791.$854,594, Forcompared to $1,117,290 for the three months ended June March30, 31, 2025, the total operating expenses amounted to $752,677.2025. The figure increaseddecreased by $585,114,$262,696, representing a growth ratedecline of 77.74%. 23.51%. This was mainly due to the risedecrease in laborsales and operating costs andas well as professional expenses (including legal and consulting service fees).

For the three months ended MarchJune 31,30, 2026, we incurred a net loss of $15,434,637,$10,495,966, compared to a net loss of $385,556$1,068,242 for the same period of 2025. The increase in net loss was mainly$9,427,724, attributedrepresenting toa thegrowth riserate of 882.55%. The decrease in labor costs and professional expenses (including legal and consulting service fees) as well as the fair value measurement of digital assets.assets represented the most significant contributor to the net loss incurred in the current period.

Comparison of the sixnine months ended MarchJune 31,30, 2026 and 2025

For the sixnine months ended MarchJune 31,30, 2026, the Homology of Medicine and Food Series, Computing Power Product Series, and Maca Product Series generated revenues of $1,855,618, $5,010,158, and $12,118,011 respectively, accounting for 9.78%, 26.39%, and 63.83% of the total revenue. Our total revenue was $18,983,787$21,155,117, compared to $84,431 for the sixnine months ended MarchJune 31, 2026 and it was $22,853 for the six months ended March 31,30, 2025, representing representingan a growthincrease of 82,969.12%.$21,070,686, or 24,956.10%. The significant increase in revenue was mainly due to the sale of maca inventory and the additional revenue generated by the new medical and food homology product series as well as the computing power product series.

For the sixnine months ended MarchJune 31,30, 2026, thecost totalof sales costrevenue was $18,882,718.$21,053,471, Forcompared to $63,819 for the sixnine months ended MarchJune 31,30, 2025, therepresenting an totalincrease salesof cost was$20,989,652, $7,374.or This figure increased by 255,971.58%.32,889.35%. The significant increase in the cost of revenue was mainly due to the corresponding cost growth of the Maca series products and the inclusion of the Homology of Medicine and Food Series and the Computing Power Product Series.

For the sixnine months ended MarchJune 31,30, 2026, the total gross profit reached $101,069,$101,646, with a gross profit margin of 0.53%.0.48%. In contrast, for the sixnine months ended MarchJune 31,30, 2025, the gross profit was $15,479,$20,612, with a gross profit margin of 67.73%. The decline in the gross profit margin was mainly due to the sale of the maca series at discounted prices and the increased proportion of revenue from the Homology of Medicine and Food Series and Computing Power Product Series.24.41%.

For the sixnine months ended MarchJune 31,30, 2026, the total operating expenses amounted to $3,417,780.$4,272,374. For the sixnine months ended MarchJune 31,30, 2025, the total operating expenses amounted to $2,270,435$3,387,725. The figure increased by $1,128,643, representing$884,649, a growth ratedecrease of 50.53%.26.11%. This wasis mainlyprimarily due to theincreased rise in laborpersonnel costs and professional expensesfees (including legal and consulting service feescharges).

For the sixnine months ended MarchJune 31,30, 2026, we incurred a net loss of $34,860,910,$45,356,876, compared to a net loss of $1,921,805$2,990,047 for the same period of 2025. The increase in net loss was mainly$42,366,829, attributedrepresenting toa thegrowth riserate of 1416.93%. The decrease in labor costs and professional expenses (including legal and consulting service fees) as well as the fair value measurement of digital assets assets.represented the most significant contributor to the net loss incurred in the current period.

Since our inception in 2011, we have incurred significant losses, and as of MarchJune 31,30, 2026, we had an accumulated deficit of approximately $132.59 $122.10 million. We have not yet achieved profitability and anticipate that we will continue to incur significant sales and marketing expenses expenses prior to recording sufficient revenue from our operations to offset these expenses. In the United States, we expect to incur additional additional losses because of the costs associated with operating as an exchange-listed public company. We are unable to predict the extent of any future losses or when we will become profitable, if at all.

As of MarchJune 31,30, 2026, the Company had a cash balance of $17,025$5,397 and has incurred recurring net losses. These conditions raise substantial doubt about the Company’s ability to continue as a going concern for a period of at least twelve months from the date of this Report.

Net cash used in operating activities from continuing operations was $10,129,033$10,350,362 for the sixnine months ended MarchJune 31,30, 2026. The cash outflows outflows were primarily related to purchases of digital assets and other professional expensesexpenses, including legal fees.

Net cash used in operating activities from continuing operations was $10,294,334$11,233,693 for the sixnine months ended MarchJune 31,30, 2025. The cash outflows were primarily related to purchases of raw materials and inventory, office rent, legal fees, and other professional expenses.

Net cash used in investing activities totaled $160$267 for the sixnine months ended MarchJune 31,30, 2026, compared with net cash provided by investing activities of $12,767$19,692 in the corresponding 2025 period. The current period’s cash outflows from investing activities were primarily attributable to the disposal of subsidiaries, whereas the prior-year period’s cash inflows stemmed mainly from subsidiary acquisitions and the sale of property and equipment.

Net cash provided by financing activities was $10,053,075$10,293,075 for the sixnine months ended MarchJune 31,30, 2026, primarily attributable to the gainsproceeds from convertibleissuances notesof Common Stock and thecash issuanceexercises of warrants. For the sixnine months ended MarchJune 31,30, 2025, net cash provided by financing activities was $10,074,304$10,964,632, primarily attributable to proceeds from private placementplacements and issuanceissuances of Common Stock.

As of MarchJune 31,30, 2026, we had no off-balance sheet arrangements that may have a current or future material effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Our discussion and analysis of our financial condition and results of operations are based upon our financial statements that have been prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”). As discussed in “Note 2—Basis of Presentation and Summary of Significant Accounting Policies” to the Consolidated Financial Statements, the preparation of financial statements in conformity with USU.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities. USU.S. GAAP provides the framework from which to make these estimates, assumptions and disclosures. We choose accounting policies within USU.S. GAAP that management believes are appropriate to accurately and fairly report our operating results and financial position in a consistent consistent manner. Management regularly assesses these policies in light of current and forecasted economic conditions. See the “Note 2—Basis of Presentation and Summary of Significant Accounting Policies” to the Consolidated Financial Statements for a summary of our accounting policies.