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

We incurred losses and had anegative workingcash capitalflows deficitfrom operations for the years ended December 31, 2024 and 2023,2025, which raises substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern depends on our ability to generate positive operating cash flows and raise additional capital significant enough to result in operating profitability.

We have incurred had a loss of $2,965,000 and $1,688,000continue forto incur losses from operations as well as negative cash flow from operations. For the yearsyear ended December 31, 20242025, and 2023, respectively, andwe had a net loss of $19.5 million, net cash used in operations of $2,485,188$10.1 million, and $265,000 during the years ended December 31, 2024 and 2023, respectively. Further, we had a negative working capital of $5,667,000 and $2,236,000 as of December 31, 20242025, andwe 2023,had respectively,an andaccumulated willdeficit of require$21.4 additional capital to operate.million. Given the preceding conditions, our auditor has raised substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern depends upon our ability to generate positive operating cash flows. To support our working capital needs, we will rely on our revenue generating customer contracts and equity and/or debt financing. There is no assurance that we will be successful in generating positive operating cash flows and raising additional capital significant enough to result in operating profitability in the future.

Our business depends upon our ability to attract new customers, and maintain and expand our relationships with our existing customers, including providing additional services to our existing customers. Our customers engage us to provide support for their events or other corporate activities. We cannot provide any assurance that customers will extend or renew their engagement with us after the events or corporate activities for which we have been engaged are completed. Extensions or renewals of customer engagement may decline or fluctuate because of several factors, such as dissatisfaction with our platform and support, a customer no longer having a need for our platform, or a belief that a competitor’s service offering is better, more secure, or less expensive than our platform. For example, during the COVID-19 pandemic, we saw a significant increase in usage of our platform and services. Following the COVID 19 pandemic, some of our customers reduced their use of our platform, and additional customers may do so in the future. Extensions or renewals of customer engagement are also impacted by reductions in customers’ information technology spending budgets or decisions by customers to consolidate their spending budgets on one of our competitor’s platforms, both of which are more likely to occur during periods of high inflation, recessionary or uncertain economic environments. Finally, any decrease in customer satisfaction with our platform or support would harm our brand, word-of-mouth referrals, and ability to grow. We need to continually add new customers to grow our business and to replace customers who choose not to continue to use our platform. If customers terminate or do not renew their business relationships with us, or renew their service contracts on less favorable terms or for fewer services, and we do not acquire replacement customers or otherwise grow our customer base, our business and results of operations may be materially and adversely affected.

Our platform,platforms, Xyvid Pro Platform,and hasTEN Pro, have broad interoperability and isare able to integrate and deliver event content to various devices, including including Windows, Mac, iOS, and Android. See “Item 1. Business— – Our Services— – Virtual and Hybrid Events.” We depend on the accessibility of our platform across these devices that we do not control. Some of our competitors may have inherent advantages by being able to develop products and services internally that more closely integrate with their own software platforms or those of their business partners.

The markets in which we compete are characterized by rapid technological changes and the frequent introduction of new products and services. Our ability to attract new customers and retain and expand the usage of existing customers depends on our ability to enhance and improve our platform, and to introduce new features and services. Our customers may require features and capabilities that our current platform does not have. We are focused on improving the quality and range of our service offerings and are committed to investing in research and development. See “Item 1. Business— – Research and Development.” Our enhancements to our platform, features or capabilities may not be compelling to our existing or potential customers and may not gain market acceptance. If our research and development investments do not accurately anticipate customer demand, or if we fail to develop our platform in a manner that satisfies customer preferences in a timely and cost-effective manner, we may fail to retain our existing customers or increase demand for our platform.

As of the date of this annualAnnual report,Report, we utilize artificial intelligence, or AI, to empower the multi-language captioning and transcription features of our Xyvid Pro Platform,platform, and we plan to implement additional features driven by artificial intelligence in the future. The initial AI-driven enhancements are expected to be available in the second quarter of 2025. See “Item 1. Business— – Growth Strategies— – Enhancing Technology Technology and Innovation.” As with many innovations, there are associated risks involved in utilizing AI technology. There can be no assurance that our use of AI will eventually produce the intended results. Even if it could produce the intended results, we cannot guarantee that such AI will not produce errors going forward. AI, particularly generative AI, has been known to produce false or “hallucinatory” inferences or outputs. AI can also present ethical issues and may subject us to new or heightened legal, regulatory, ethical, or other challenges. Inappropriate or controversial data practices by developers and end-users, or other factors adversely affecting public opinion concerning AI, could impair the acceptance of AI solutions, including those incorporated in our services. If the AI tools that we use are deficient, inaccurate, or controversial, we could incur operational inefficiencies, competitive harm, legal liability, brand or reputational harm, or other adverse impacts on our business and financial results. In addition, regulation of AI is rapidly evolving worldwide, as legislators and regulators are increasingly focused on these powerful emerging technologies. The technologies underlying AI and its uses are subject to a variety of laws and regulations, including intellectual property, data privacy and security, customer protection, competition, and equal opportunity laws, and are expected to be subject to increased regulation and new laws or new applications of existing laws and regulations. For example, federal artificial intelligence legislation has been introduced in the U.S. Senate. Since these regulatory frameworks rapidly evolve, we may become subject to new laws and regulations, which may affect the legality, profitability, or sustainability of our business, and we may be unable to predict all the legal, operational, or technological risks that may arise relating to the use of AI. The failure to comply with the relevant regulatory frameworks may also negatively affect our reputation. Because AI technology itself is highly complex and rapidly developing, it is not possible to predict all the legal, operational, or technological risks that may arise relating to the use of AI. Failure to appropriately respond to this evolving landscape may result in legal liability, regulatory action, or brand and reputational harm. As of the date of this Annual Report, the Company does not intend to utilize open-source AI.

The webcasting market is competitive and rapidly changing, and existing and new market entrants, particularly established companies with greater resources than we have, that provide technologies to improve communication and engagement technologies or platforms, such as artificial intelligence and machine learning, could also increase the level of competition in the market. We face competition from many large and small companies, which include, but are not limited to, Zoom, ON24, GlobalMeet, Cvent, Bizzabo, and Meeting Tomorrow. See “Item 1. Business— – Our Industry.”

Our competitors vary in size and in the breadth and scope of the products and services they offer. Many of our actual and potential competitors benefit from competitive advantages over us, such as greaterstronger namebrand recognition; longer operating histories; more varied products and services; larger marketing budgets; more established marketing relationships; more third-party integration; greater accessibility across devices devices or applications; greater access to larger user bases; and greater financial, technical, and other resources. Some of our competitors may make acquisitions or strategic investments or enter into strategic relationships to offer a broader range of products and services than we do, which may prevent us from using such third parties’ technology or offering such products or services. These combinations may make it more difficult for us to compete effectively. We expect these trends to continue as competitors attempt to strengthen or maintain their market positions. As we introduce new services, and with the introduction of new technologies and market entrants, we expect competition to intensify in the future.

Demand for our platform is price sensitive. Many factors, including our pricing and marketing strategies, customer acquisition, and technology costs, as well as the pricing and marketing strategies of our competitors, can significantly affect our pricing strategies. Certain competitors offer, or may in the future offer, lower-priced or free products or services that compete with our platform or certain aspects of our platform, and they may offer a broader range of products and services than we do. Even if such competing products do not include all of the features and functionality that we provide, we could face pricing pressure to the extent that customers find such alternative products to be sufficient to meet their needs. Similarly, certain competitors or potential competitors may use marketing strategies that enable them to acquire customers at a lower cost than we can. Moreover, our major customers may demand substantial price concessions. As a result, we may be required to provide our major customers with pricing below our targets in the future. As a result, we could lose market share to our competitors or be forced to engage in price-cutting initiatives or other discounts to attract and retain customers, each of which could harm our business, results of operations and financial condition.

Our ability to increase our customer base and achieve broader market acceptance of our services will depend to a significant extent on our ability to expand our marketing and sales operations. We plan to continue expanding our sales and marketing capabilities, including through additional investment in digital marketing and sales team expansion. See “Item 1. Business— – Growth Strategies.” If we we are unable to expand our sales and marketing operations, our future revenue growth and business could be adversely impacted.

For the years ended December 31, 20242025 and 2023,2024, the same single customer independently accounted for more than 10% of our total revenue; accounting for approximately 64.6%66.7% and 51.1%64.6% of our total revenue, respectively. See “Item 1. Business— – Our Customers.” We believe that, in the foreseeable future, we may continue to derive a significant portion of our revenue from such significant customer. If such customer fails to make payments, or experiences a downturn in business, our revenue and results of operations may be materially and adversely affected. We may lose our significant customer due to a variety of factors, including our capacity to deliver reliable services, service efficiency, as well as our competitiveness in pricing strategies. We cannot guarantee that we will continue to maintain the business relationship with our significant customer at the same level, or at all. If our significant customer terminates its relationship with us, we cannot assure you that we will be able to secure an alternative arrangement with a comparable customer in a timely manner, or at all. Losing our significant customer could adversely affect our revenue and profitability. In the short term, losing our significant customer may lead to a substantial loss of revenue and potentially disrupt cash flow. In the long term, it could impact market perception and our ability to attract new customers.

For the year ended December 31, 2025, one supplier independently accounted for more than 10% of our total purchases, accounting for approximately 12.6% of our total purchases. For the year ended December 31, 2024, one supplier independently accounted for more than 10% of our total purchases, accounting for approximately 17.9% of our total purchases. For the year ended December 31, 2023, one supplier independently accounted for more than 10% of our total purchases, accounting for approximately 27.2%17.9% of our total purchases. See “Item 1. Business— – Our Suppliers.” Such third-party third-party suppliers are subject to their own unique operational and financial risks, which are beyond our control. If such significant suppliers suppliers breach or terminate their contracts with us, or experience significant disruptions to their operations, we will be required to find and enter into arrangements with one or more replacement suppliers. Finding alternative suppliers could involve significant delays and other costs and these suppliers may not be available to us on reasonable terms, or at all. As a result, this could harm our business and financial results and result in lost or deferred revenue.

We experience seasonality in our business. We usually generate more revenue in the last month of each calendar quarter. See “Item 1. Business— – Seasonality.” We may experience capacity and resource shortages in our platform and services during the period of such seasonal surge in our business. As a result of seasonality, our financial condition and results of operations may continue to fluctuate, and the trading price of our common stock may fluctuate from time to time.

Our ability to attract and retain customers depends on our ability to provide our customers and their users with a highly reliable platform. We currently use data centers in the United States. Our platform may not be fully available to customers in the event of catastrophic failure at one of those data centers. We also do not control the operation of the data centers we use, and they are vulnerable to damage or interruption from human error, intentional bad acts, natural disasters, war, terrorist attacks, cyber-attacks and other cybersecurity incidents, power losses, hardware failures, systems failures, telecommunications failures and similar events, any of which could disrupt our services. In the event of significant physical damage to one of these data centers, it may take a significant period of time to achieve full resumption of our platform, and our disaster recovery planning may not account for all eventualities. As of the date of this annualAnnual report,Report, we have experienced service disruptions, outages and other performance problems,problems which caused delays to events, due to the introduction of new functionality, human error, and capacity constraints, and we may in the future experience further service disruptions, outages and other performance problems due to a variety of other factors, including infrastructure changes, software errors, zero-day vulnerabilities, and denial-of-service attacks, ransomware attacks and other cybersecurity incidents by malicious actors. In some instances, we may not be able to rectify these performance issues within an acceptable time-frame.

We expect our business to grow in terms of scale and diversity of operations. In addition, we plan to improve the features of our platform and incorporate more emerging technologies to enhance our platform. This will enable us to diversify and expand our service offerings. See “Item 1. Business— – Growth Strategies.” Such expansions will increase the complexity of our operations and may cause cause strain on our managerial, operational, and financial resources. We must continue to hire, train, and effectively manage new employees. The expansion of our services will also require us to maintain consistency in the quality of our services so that our market reputation is not damaged by any deviations in quality, whether actual or perceived.

We maintain certain insurance policies to safeguard against risks and unexpected events. See “Item 1. Business— – Insurance.” However, there can be no assurance that such insurance coverage will always be available or will always be sufficient to cover any damages resulting from any kind of claims. In addition, there are certain types of risks that may not be covered by our insurance policies, such as war, force majeure events, or certain business interruptions. Claims that are not covered by the policies or the failure to renew the insurance policies may materially adversely affect our business, financial condition, and results of operations.

Our business strategy may, from time to time, include acquiring or investing in new or complementary services, technologies or businesses, strategic investments and partnerships, or other strategic transactions. We plan to identify, invest in, partner with, and acquire appropriate businesses that offer complementary advantages to our business, thereby improving overall competitiveness and sustaining growth. See “Item 1. Business— – Growth Strategies.” We cannot assure you that we will successfully identify suitable acquisition candidates or transaction counterparties, securely or effectively integrate or manage disparate technologies, lines of business, personnel and corporate cultures, realize our business strategy or the expected return on our investment, or manage a geographically dispersed company. Any such acquisition, investment, strategic partnership, or other strategic transaction could materially and adversely affect our results of operations. The process of negotiating, effecting, and realizing the benefits from acquisitions, investments, strategic partnerships, and strategic transactions is complex, expensive and time-consuming, and may cause an interruption of, or loss of momentum in, development and sales activities and operations of both companies, and we may incur substantial cost and expense, as well as divert the attention of management. We may issue equity securities which could dilute current stockholders’ ownership, incur debt, assume contingent or other liabilities and expend cash in acquisitions, investments, strategic partnerships, and other strategic transactions which could negatively impact our financial position, stockholder equity, and stock price.

For the years ended December 31, 20242025 and 2023,2024, we had total revenue of approximately $3.5$3.1 million and $3.7$3.5 million, respectively, and net loss of approximately $3.0$19.5 million and $1.7$3.0 million, respectively. Our financial results in the past may not be indicative of future results, and we cannot assure you that we will achieve or maintain profitability on a consistent basis. Our revenue growth may slow, or our revenue may decline for a number of reasons, including reduced demand for our products and services, increased competition, industry trend,trends, or our failure to capitalize on growth opportunities. Meanwhile, we expect our overall operating expenses to continue to increase in the foreseeable future, as we will incur additional expenses in connection with the expansion of our business operations and as a newly public company. These efforts and additional expenses may be more costly than we currently expect, and there is no assurance that we will be able to maintain sufficient operating revenue to offset our operating expenses. Any failure to increase revenue or to manage our costs as we continue to grow and invest in our business would prevent us from achieving or maintaining profitability or maintaining positive operating cash flow at all, or on a consistent basis, which would cause our business, financial condition, and results of operations to suffer.

Occurrence of any catastrophic event, including pandemics such as COVID-19,pandemics, earthquakes, fires, floods, tsunamis or other weather event, power loss, telecommunications failure, software or hardware malfunctions, cyberattacks, war or terrorist attacks, could result in lengthy interruptions in our services. In particular, our corporate headquarters are located in Pennsylvania, a region known for flooding, and our insurance coverage may not sufficiently compensate us for losses that may occur in the event of a severe flooding event or other significant natural disaster. In addition, acts of terrorism could cause disruptions to the internet, the electric grid or the economy as a whole. If our systems were to fail or be negatively impacted as a result of a natural disaster or other catastrophic event, our ability to deliver our products and services to our customers would be impaired or we could lose critical data. If we are unable to develop adequate plans to ensure that our business functions continue to operate during and after a disaster and to execute successfully on those plans in the event of a disaster or emergency, our business could be harmed.

In the United States, federal, state, and local governments have enacted numerous privacy, data protection, and information security laws, including data breach notification laws, consumer protection laws, and other similar laws. See “Item 1. Business— – Regulations.” While as of the date of this annual report, we have not been subject to any legal or administrative penalties or received any notifications from regulatory authorities for privacy, data protection, or information security concerns, theThe developments or changes to the applicable laws and regulations may complicate compliance efforts and increase legal risk and compliance costs for us and the third parties upon whom we rely. If we fail to comply with stringent and evolving laws and regulations, industry standards, policies, and contractual obligations relating to privacy, data protection, information security, and other matters, it could harm our reputation and business and subject us to significant fines and liability.

As a service provider, we do not regularly monitor our platform to evaluate the legality of content shared on it by our customers. While as of the date of this annual report, we have not been subject to legal or administrative actions as a result of the content shared on our platform, theThe laws in this area are evolving and vary widely between jurisdictions. Accordingly, it may be possible that in the future we and our business partners may be subject to legal actions involving our customers’ content or use of our platform.

We are subject to a variety of U.S. laws and regulations, such as the Americans with Disabilities Act (ADA) which requires virtual events to be accessible to individuals with disabilities, and various laws and regulations of states where we conduct business activities or where digital content is distributed, livestreamed, or made available through our platform or services. We are also subject to various international regulations on information security, copyrights and intellectual properties. See “Item 1. Business— – Regulations.” To the extent we expand our market presence, our exposure for violating these laws and regulations will likely increase. If we fail to comply with the legal standards and requirements, we may face substantial civil and criminal fines, penalties, profit disgorgement, reputational harm, loss of access to certain markets, disbarment from government business, the loss of export privileges, tax reassessments, breach of contract, fraud and other litigation, reputational harm, and other foreseeable or unforeseen collateral consequences that could harm our business.

We regard our domain names and other intellectual property we may develop or acquire as critical to our success. See “Item 1. Business— – Intellectual Property.” We have taken measures to protect our intellectual property, but these measures might not be sufficient or effective. We may bring lawsuits to protect against the potential infringement of our intellectual property rights. Policing unauthorized use of our proprietary technology and other intellectual property is difficult and expensive, and litigation may be necessary in the future future to enforce their intellectual property rights. Future litigation could result in substantial costs and diversion of our resources and and could disrupt our business, as well as materially adversely affect our financial condition and results of operations. Further, despite the potentially substantial costs, we cannot assure you that we will prevail in such litigation. In addition, our trade secrets may be leaked or otherwise become available to, or be independently discovered by, our competitors. Any failure in protecting or enforcing our intellectual property rights could have a material adverse effect on our business, financial condition, and results of operations.

From time to time, we may be involved in various claims, controversies, lawsuits, legal proceedings, or regulatory inquiries that arise in in the ordinary course of business involving labor and employment, wage and hour, intellectual property, data breach and other matters. matters. See “Item 1. Business— – Legal Proceedings.Proceedings” for the current investigations of which the Company is subject. We expect that the number and significance of these potential disputes or claims may increase as our business expands and our company grows larger. Contractual provisions and insurance coverage may not cover potential claims and may not be adequate to indemnify us for all liabilities we may face. Any claims against us, whether meritorious or not, could be time consuming, result in costly litigation, require significant amounts of management time, and result in the diversion of significant operational resources. Litigation is inherently unpredictable, and the results of any claims may have a material adverse effect on our business, financial condition, results of operations, and prospects. In addition, negative publicity regarding claims or judgments made against our Company may damage our reputation and may result in a material adverse impact on us.

There have been instances of extreme stock price run-ups followed by rapid price declines and strong stock price volatility with recent initial public offerings, especially among those with relatively smaller public floats. As a relatively small-capitalizationmicro-cap company with a relatively small public float, we may experience greater stock price volatility, extreme price run-ups, lower trading volume, and less liquidity than large-capitalization companies. In particular, our common stock may be subject to rapid and substantial price volatility, low volumes of trades, and large spreads in bid and ask prices. Such volatility, including any stock run-ups, may be unrelated to our actual or expected operating performance and financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our common stock.

Our certificate of incorporation permits us to issue, without approval from our stockholders, a total of 1,000,000 shares of preferred stock, none of which are outstanding. Our board of directorsBoard can determine the designations, powers, preferences and voting and other rights, and the qualifications, limitations and restrictions granted to, or imposed upon, the shares of preferred stock and to fix the number of shares constituting any series and the designation of such series. It is possible that our board of directors,Board, in determining the rights, preferences and privileges to be granted when the preferred stock is issued, may include provisions that have the effect of delaying, deferring or preventing a change in control, discouraging bids for our common stock at a premium over the market price, or that adversely affect the market price of and the voting and other rights of the holders of our common stock.

We are a public company in the United States subject to the Sarbanes-Oxley Act of 2002. Section 404 of the Sarbanes-Oxley Act of 2002 willrequires require that we include a report of management on our internal control over financial reporting in our annualAnnual reportReports on 10-K beginning with our annual report for the fiscal year ending December 31, 2025.10-K. In addition, once we ceasehave reached “accelerated filer” or “large accelerated filer” status and have ceased to be an “emerging growth company,” as such term is defined in the JOBS Act, our independent registered public accounting firm must attest to and report on the effectiveness of our internal control over financial reporting. Our management may conclude that our internal control over financial reporting is not effective. Moreover, even if our management concludes that our internal control over financial reporting is effective, our independent registered public accounting firm, after conducting its own independent testing, may issue a report that is qualified, if it is not satisfied with our internal controls or the level at which our controls are documented, designed, operated, or reviewed, or if it interprets the relevant requirements differently from us. In addition, after we become a public company, our reporting obligations may place a significant strain on our management, operational, and financial resources and systems for the foreseeable future. We may be unable to complete our evaluation testing and any required remediation in a timely manner.

We completed our initial public offering in February 2025 and have started bearing significant legal, accounting, and other expenses as a public company that we did not incur as a private company since then.company. These additional costs could negatively affect our financial results. The Sarbanes-Oxley Sarbanes-Oxley Act of 2002, as well as rules subsequently implemented by the SEC and Nasdaq, impose various requirements on the corporate governance governance practices of public companies.

Compliance with these laws, rules, and regulations increases our legal and financial compliance costs and makes some corporate activities more time-consuming and costlier. These laws, regulations, and standards are subject to varying interpretations and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. We intend to invest resources to comply with evolving laws, regulations, and standards, and this investment may result in increased general and administrative expenses and a diversion of management’s time and attention from revenue-generating activities to compliance activities. In addition, we will incur additional costs associated with our public company reporting requirements. It may also be more difficult for us to find qualified persons to serve on our board of directorsBoard or as executive officers.

There can be no assurance that we will be able to maintain the listing standards of Nasdaq,the Nasdaq Capital Market, the exchange on which our common stock is traded, which includes requirements that we maintain our stockholders’ equity, total value of shares of common stock held by unaffiliated stockholders, minimum bid price, and market capitalization above certain specified levels. For example, on June 30, 2025, we received a deficiency letter from the Listing Qualifications Department of Nasdaq notifying us that the Company had not been in compliance with Nasdaq’s minimum bid price requirement. In order to cure the deficiency, we effected a 1-for-15 reverse stock split on December 1, 2025 to regain compliance with Nasdaq’s minimum bid price requirement. Because we effected such reverse stock split to cure our minimum bid price deficiency in December 2025, should our stock price fail to meet Nasdaq’s minimum bid price requirement at any time prior to December 1, 2026, we will not be eligible for any compliance period and our stock will be immediately delisted.

If we fail to conform to the Nasdaq listing requirements on an ongoing basis, our common stock might cease to trade on Nasdaq, and may move to the OTCQB or OTC Pink Markets operated by OTC Markets Group, Inc. These quotation services are generally considered to be markets that are less efficient and that provide less liquidity in the shares of common stock than Nasdaq. A delisting could substantially decrease trading in our common stock, adversely affect the market liquidity of our common stock as a result of the loss of market efficiencies associated with Nasdaq and the loss of federal preemption of state securities laws, adversely affect our ability to obtain financing on acceptable terms, if at all, and may result in the potential loss of confidence by investors, suppliers, customers and employees and fewer business development opportunities.

We willare beno longer a “controlled company” within the meaning of the Nasdaq listing rules,rules. andHowever, we will followcontinue to rely on certain exemptions from certain corporate governance requirements during a transition period that could adversely affect our public stockholders.

We are an “emerging growth company” as defined in the JOBS Act and a “smaller reporting company” as defined inunder the JOBSapplicable rules Act,of the SEC, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” and “smaller reporting companies” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

We may continue to be a “smaller reporting company” even after we are no longer an emerging growth company. We may take advantage of certain of the scaled disclosures available to “smaller reporting companies” and will be able to take advantage of these scaled disclosures for so long as (i) the market value of our common stock held by non-affiliates is equal to or less than $250 million as of the last business day of the most recently completed second fiscal quarter, or (ii) our annual revenue is equal to or less than $100 million during the most recently completed fiscal year and the market value of our common stock held by non-affiliates is equal to or less than $700 million as of the last business day of the most recently completed second fiscal quarter.

We are a provider of event planning, production, and broadcasting services headquartered in Langhorne, Pennsylvania. We mainly produce virtualvirtual, hybrid, and hybrid eventsself-service and physical events. VirtualVirtual, hybrid and hybridself-service events could involve virtual and hybrid event planning, production and broadcasting services, and continuing education services, all of which are supported by our proprietary Xyvid Pro Platform.platform and TEN Pro platform. Physical events mainly involve live streaming and video recording of physical events.

Operating profit is the difference between our revenue and cost of revenue and selling, general and administrative expenses. Operating profit margin is the operating profit margin as a percentage of revenue.

From time to time, we have non-recurring, non-operating gains and losses which are reflected through other income (expenseexpenses).

Comparison of Results of Operations for the years ended December 31, 2025 and 2024 The following table sets forth our statements of operations for the years ended December 31, 20242025 and 20232024:

Revenue decreased by approximately $215$0.4 thousand,million, or 5.8%,11%, to approximately $3,504$3.1 thousand.million. The decreasedecline was primarily driven by following factors:

Cost of revenue increased by approximately $97$0.01 thousand,million, or 17.5%,1.7%, to approximately $652$0.7 thousand.million. Cost of revenue increasedremained relatively flat while physical events revenue decreased increased mainly due to highercontinued outsourcedefficiencies laborin coststhe associated with physicalway events andare adelivered singularso hybrid event that required significant third-party productionequipment and staff laborare costs.maximized within the specific region or location of events.

Other Income (Expense), net and Interest Expenses

TheOther totalincome of other expenses and interest expenses(expense) increased by approximately $216$5.8 thousand, or 900.0%,million to approximately $240$5.8 thousandmillion primarily due to thean increaseimpairment inloss recognized borrowing.on our software and loss on debt restructuring.

As a result of the foregoing, the net loss was approximately $2,968$19.5 thousandmillion during the year ended December 31, 2024,2025, compared to the net loss of approximately $1,688$3.0 thousandmillion during the year ended December 31, 2023.2024.

As of December 31, 20242025 and 2023,2024, we had cash of approximately $48$1.6 thousandmillion and $357$0.05 thousand,million, respectively. Liquidity is a measure of our ability to meet potential cash requirements. As of December 31, 2025, the Company had access to $18.0 million of liquidity through our ELOC. We generally have funded our operations with cash flow from operations, and, when needed, borrowing from financial institutions and capital injections from our principal shareholders.stockholders. V-Cube acted as one of our main sources of funding in 2025. As TEN continues to grow, it expects to continue funding its operations by issuing shares to a wider stockholder base and/or accessing the ELOC for additional capital subject to market conditions. Our principal use of liquidity has been to fund our daily operations and working capital. We expect that our cash and cash equivalents will be sufficient to fund our operating expenses and cash obligations for the next 12 months, although our ability to continue as a going concern depends upon our ability to attract and retain revenue generating customers, acquire new customer contracts, and secure additional financing. We expect we will require additional financing through debt and equity investments to fund our operating expenses and cash obligations beyond the next 12 months. See “Contractual Obligations and Commitments” for a discussion of our material cash requirements and “Cash flows for the years ended December 31, 2025 and 2024” for a discussion of the anticipated sources of funds needed to satisfy those cash requirements.

Net cash used in operating activities increased from approximately $265$2.5 thousandmillion during the year ended December 31, 20232024 to approximately $2,485$10.1 thousandmillion during the year ended December 31, 2024. 2025. The increase in cash outflowoutflows was primarily duedriven by higher operating expense associated with the Company’s transition to a public company, including increased professional fees, payroll, and other corporate infrastructure cost, as well as the higher net loss reported in the year ended December 31, 2024. 2025.

Net cash used in investing activities decreased from approximately $1,075$1.0 thousandmillion during the year ended December 31, 20232024 to approximately $1,037$0.9 thousandmillion during the year ended December 31, 2024.2025. The decrease in cash outflowoutflows was mainlyprimarily due to alower reductionexpenditures inon the amountpurchase of property and equipment and capitalized with respectinternal-use tosoftware during the internallyyear developedended software.December 31, 2025.

As of the date of this Quarterly Report on Form 10-Q, there have been no material changes to the risk factors disclosed in our Annual Report on Form 10-K filed with the SEC on March 18, 2026.2026, except that we have identified the additional risk factors set forth below.

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Rule 175 promulgated thereunder, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Rule 3b-6 promulgated thereunder. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including, but not limited to: any projections of earnings, revenue, or other financial items; any statements regarding the adequacy, availability, and sources of capital, any statements of the plans, strategies, and objectives of management for future operations; any statements concerning proposed new products, services, or developments; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing. Forward-looking statements may include the words “may,” “might,” “will,” “should,” “would,” “could,” “likely,” “estimate,” “intend,” “continue,” “future,” “potential,” “believe,” “expect,” “plan,” “project,” “target,” “forecast,” “outlook,” or “anticipate,” and other similar words or phrases. In addition to any assumptions and other factors and matters referred to specifically in connection with such forward-looking statements, factors that could cause actual results or outcomes to differ materially from those contained in the forward-looking statements include those factors set forth in the “Risk Factors” section included in our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the Securities and Exchange Commission (the “SEC”) on March 18, 2026 (the “Annual Report”) .

TEN Holdings, Inc. (the “Company,” “TEN Holdings,” “we,” “us,” or “our”), headquartered in Langhorne, Pennsylvania, was incorporated on February 12, 2024, in Pennsylvania to serve as the holding company for TEN Events, Inc. (“TEN Events”), an operating subsidiary incorporated in Pennsylvania in May 2011. Through TEN Events, the Company delivers technology-enabled event engagement and digital communications solutions that help organizations create, manage, and distribute virtual, hybrid, self-service, and in-person experiences. Our offerings combine proprietary software, production capabilities, and managed services to support enterprise customers throughout the event lifecycle, including content delivery, audience engagement, webinar management, and continuing education programs. Following our corporate restructuring completed during fiscal 2023, we expanded our capabilities to include in-person event production, live streaming, and multimedia content capture, further enhancing our integrated technology offering. As of the date of this Quarterly Report on Form 10-Q, we primarily generate revenue from virtualsubscriptions and hybridusage eventsof deliveredour technology offering, as well as related professional and managed services provided to corporate enterprise customers. We experienced ana increasedecrease in our total revenue in the firstsecond quarter of fiscal year 2026, mainly due to less the expected revenue coming from one of our repeatablelargest customers, while also clientshaving increasinga theirsignificant revenuenumber quarter-over-quarterof byopportunities over 100%, comparedshift to the samethird periodquarter lastof year.fiscal year 2026. For the threesix months ended March 31,June 30, 2026 and 2025, we had total revenue of approximately $0.9$1.6 million and $0.7$1.9 million, respectively, and net loss of approximately $2.9 $5.9 and $4.8 $7.6 million, respectively. For the threesix months ended MarchJune 31,30, 2026 and 2025, the revenue generated from virtualplatform and hybrid eventsusage was approximately $0.8$1.3 million and $0.7$1.6 million, respectively, accounting for approximately 92.7%79.5% and 96.4%85.6% of our total revenue, respectively; and the revenue generated from physicalprofessional eventsand managed services was approximately $0.1$0.3 million and $0.03$0.3 million, respectively, accounting for approximately 7.3%20.5% and 3.6%14.4% of our total revenue, respectively.

Operating profit is the difference between our revenue and cost of revenue and selling, general and administrative expenses and depreciation expenses. Operating profit margin is the operating profit as a percentage of revenue.

Comparison of Results of Operations for the three months ended MarchJune 31,30, 2026 and 2025

The following table sets forth our statements of operations for the three months ended MarchJune 31,30, 2026 and 2025:

Revenue increaseddecreased by $0.1$0.4 million, or 15.4%,34.5%, to $0.9$0.7 million. The increasedecrease was primarily driven by less revenue from one of our majorlargest customerscustomers, while increasing theiralso having a significant number of opportunities shift to the third quarter of fiscal year 2026 and the related revenue quarter-over-quarterto bybe recognized 100%.then.

SG&A expenses decreasedincreased by $1.8$1.5 million, or 34.6%,67.6%, to $3.4$3.6 million, primarily due to loweran headcount cost during the same period last year as well as the less stock-based compensation expenses recognizedincrease in theprofessional current period.fees.

Interest expenses increaseddecreased by $0.008$0.05 million, or 11.6%,65.0%, to $0.06$0.03 million, primarily due to continueda accruedlower interestoutstanding onshort-term loan balance during the loansthree takenmonths byended the Company.June 30, 2026.

As a result of the foregoing, the net loss was $2.9$3.0 million during the three months ended MarchJune 31,30, 2026 compared to the net loss of $4.8$2.8 million during the three months ended MarchJune 31,30, 2025.

We define Adjusted EBITDA as our net loss excluding: (i) interest expense, (ii) provision for income taxes, (iii) depreciation and amortization, (iv) other expense (income), expense, and (v) stock-based compensation expense.

The following table provides a reconciliation of net loss to Adjusted EBITDA for the three months ended June 30, 2026 and 2025:

As of MarchJune 31,30, 2026 and December 31, 2025, we had cash of $0.1$5.8 million and $1.6 million, respectively. Liquidity is a measure of our ability ability to meet potential cash requirements. We generally fund our operations with cash flow from operations, and, when needed, borrowedborrow funds from financial institutions and related parties.institutions. In addition, as we continue to grow, we expect to continue funding our operations by issuing shares of our common stock to a wider stockholder base, subject to market conditions. InOn June 2025,30, 2026, we entered intoissued a purchase agreement with Lincoln Park Capital Fund, LLC (“Lincoln Park”), giving the us the right, but not the obligation to sell to Lincoln Park up to $20.0 million worth of7,500,000 shares of our common stock for (thenet “ELOC”).proceeds Weof do$6.6 not intendmillion in a registered direct offering to sellcertain further shares pursuant to the ELOC at this time.investors.

Our principal use of liquidity has been to fund our daily operations and working capital and we expect that to continue for the next 12 months and beyond. We have incurred and continue to incur losses from operations and negative cash flows from operating activities. For the three six months ended MarchJune 31,30, 2026, we incurred a net loss of $2.9$5.9 million and used $1.1 $2.7 million of cash in operating activities. As of March 31,June 30, 2026, we had an accumulated deficit of $24.3$27.3 million and short-term related-party debt obligations of $3.0$0.4 million, all of which will mature within the next twelve months. These conditions, together with our limited cash balance as of March 31, 2026, raise substantial doubt about our ability to continue as a going concern.

Our ability to continue as a going concern depends upon our ability to attract and retain revenue-generating customers, acquire new customer contracts, implement cost control measures, receive financial support from related parties, and secure additional debt or equity financing. In March 2026, we entered into a Corporate Support and Funding Agreement with V-Cube, Inc., pursuant to which V-Cube committed to provide financial support in the aggregate amount of $5.4 million, payable in installments during 2026. Management is alsoalways evaluating additional debt or equity financing alternatives, although there can be no assurance that any such financing will be available on acceptable terms or at all.

As of MarchJune 31,30, 2026, the Company had a total of $3.6$0.5 million in contractual obligations for future payments.

As of MarchJune 31,30, 2026, we had outstanding short-term debt obligations of $3.0$0.5 million which mature within the next twelve months. We also have $0.6 million in operating lease obligations due over the next five years.

During the threesix months ended MarchJune 31,30, 2026 and 2025, we spent nil and $0.3$0.5 million, respectively, on acquisitions of capitalized software.

As of MarchJune 31,30, 2026, the Company did not have any off-balance sheet arrangements, as defined in the rules and regulations of the SEC.

Cash flows for the threesix months ended MarchJune 31,30, 2026 and 2025 (in thousands)

Net cash used in operating activities mainly consists of our net loss adjusted for certain non-cashnoncash items, including stock-based compensation expense and depreciation and amortization, as well as the effect of changes in operating assets and liabilities during each period.

For the threesix months ended MarchJune 31,30, 2026, net cash used in operating activities was $1.1$2.7 million, compared to $6.8$7.6 million during the threesix months months ended MarchJune 31,30, 2025. The decrease in cash outflow was primarily due ato lower net loss during the current period.period and a decrease in advance to related party, partially offset by lower non-cash adjustment for stock-based compensation expenses and loss on extinguishment of debt.

Investing ActivitiesActivity

Net cash used in investing activities decreased to nil for the threesix months ended MarchJune 31,30, 2026, compared to $0.3$0.5 million for the threesix months ended MarchJune 31,30, 2025. The decrease was primarily due to reducedthe expendituresabsence forof purchase of property and equipment and capitalized software during the current period.

Net cash provided by financing activities shiftedwas to a net outflow of $0.5$7.0 million for the threesix months ended MarchJune 31,30, 2026, compared to a net inflow of $7.3$8.8 million for the threesix months ended MarchJune 31,30, 2025. The decrease was primarily driven by $8.9 million inlower proceeds received from the issuance of shares receivedand short-term loans from related parties during the prior-yearcurrent period, whichpartially didoffset notby recurlower inrepayments thefor currentshort-term quarter.loans from related parties.