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

Except for the historical information contained herein or incorporated by reference, this Annual Report and the information incorporated by reference herein contain forward-looking statements that involve risks and uncertainties. These statements include projections about our accounting and finances, plans and objectives for the future, future operating and economic performance and other statements regarding future performance. These statements are not guarantees of future performance or events. Our actual results could differ materially from those discussed in this report. Factors that could cause or contribute to these differences include, but are not limited to, those discussed in this section, as well as those discussed in Part II, Item 7 entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere throughout this Annual Report and in any documents incorporated by reference herein.Report.

You should carefully consider the following risk factors and in the other information included or incorporated in this Annual Report. If any of the following risks, either alone or taken together, or other risks not presently known to us or that we currently believe to not be significant, develop into actual events, then our business, financial condition, results of operations or prospects could be materially adversely affected. If that happens, the market price of our Class A Common Stock could decline, and stockholders may lose all or part of their investment.

Current PRC laws and regulations impose certain restrictions or prohibitions on foreign investment ownership of companies that engage in medical institutions whichand ourcompanies stem cell bank relates to, andengaged in the development and application of technologies for diagnosis and treatment of human stem cells and genes, which our stem cell bank and endometrial stem cell bank business relates to. Pursuant to the Special Administrative Measures (Negative List) issued by the NDRC and MOFCOM on DecemberSeptember 27,8, 2021,2024, which came into force on JanuaryNovember 1, 2022,2024, foreign investment are allowed in PRC medical institutions only through joint venture entities, and the foreign shareholding in these entities is limited to 70.0%, which percentage was stipulated in the Interim Administrative Measures on Sino-Foreign Equity Medical Institutions and Sino-Foreign Cooperative Medical Institutions, or the JV Interim Measures. Additionally, certain industries are specifically prohibited for foreign investment, including the development and application of technologies for diagnosis and treatment of human stem cells and genes. On September 7, 2024, NDRC, MOFCOM and National Health Commission (NHC) promulgated pilot policies permitting wholly foreign-owned enterprises to engage in the development and application of human stem cell and gene diagnosis and treatment technologies in free trade zones of Beijing, Shanghai, Guangdong, and Hainan, and permitting the establishment of wholly foreign-owned medical institutions in certain pilot municipalities including Beijing and Shanghai, subject to compliance with relevant PRC laws and regulations. This pilot program may be expanded in the future, but there is no guarantee it will apply nationwide or to our specific operations.

The 2019 PRC Foreign Investment Law further specifies that foreign investments shall be conducted in line with the “negative list” to be issued by or approved to be issued by the State Council. This means that an FIE would not be allowed to make investments in prohibited industries in the “negative list,” while the FIE must satisfy certain conditions stipulated in the “negative list” for investment in restricted industries. As pursuant to the negative list issued by the NDRC and MOFCOM taking effect on JanuaryNovember 1, 2022,2024, medical services is a restricted industry and foreign investment are allowed in PRC medical institutions only through joint venture entities, i.e., an FIE in which foreign ownership is limited to 70.0%. Additionally, certain industries are specifically prohibited for foreign investment, including the development and application of technologies for diagnosis and treatment of human stem cells and genes, which means, pursuant to the Foreign Investment Law, FIEs are prohibited from practicing such businesses in China.

On July 7, 2022, the CAC promogulated the Outbound Data Transfer Security Assessment Measures (the “Measures”), which became effective on September 1, 2022. According to the Measures, a PI Handler should declare a mandatory security assessment for its outbound data transfer to the CAC through the local provincial cyberspace administration under the following circumstances (i) where such PI Handler provides critical data outside the territory of the PRC, (ii) where the PI Handler being a CIIO or processing the personal information of more than one million individuals provides personal information outside the territory of the PRC, (iii) where a PI Handler has provided personal information of 100,000 individuals or sensitive personal information of 10,000 individuals in total outside the territory of the PRC since January 1 of the previous year; or (iv) other circumstances prescribed by the CAC for which declaration for security assessment for cross-border data transfers is required. Considering that (i) Yubo Beijing is not in possession of or otherwise holding personal information of over one million users and it is also very unlikely that we will reach such threshold in the near future; (ii) as of the date of this Annual Report, Yubo Beijing has not received any notice or determination from applicable PRC governmental authorities identifying Yubo Beijing as a CIIO, or as a processor of critical data, and (iii) since January 1, 2022, Yubo Beijing has not provided personal information of 100,000 individuals or sensitive personal information of 10,000 individuals outbound accumulatively, we do not believe we are currently obliged to declare a mandatory security assessment under the Measures. However, according to the draft version of the PRC national standard “Information security technology—Guideline for identification of critical data” dated January 2022, information related to human genetic resources might fall into the scope of critical data. Although this national standard has not releasedbeen itsformally final version and become effectiveadopted yet, if we are deemed to be a PI Handler providing critical data outbound in the future, we might be subject to the mandatory security assessment as mentioned above.

Pursuant to HGR Regulation, there are some limitations for foreign entities, individuals and such entities established or actually controlled thereby (“Restricted Entities,” and each, a “Restricted Entity”) to engage in activities relating to human genetic resources. For example, the Restricted Entity is not allowed to collect or preserve human genetic resources of China, while it is prohibited from using human genetic resources of China unless that such Restricted Entity has obtained an approval from relevant government authority or has filed with relevant government authority for international cooperation with a domestic entity. On May 26, 2023, the Ministry of Science and Technology of China issued the Implementing Rules for the HGR Regulation (the “HGR Implementing Rules”), which became effective from July 1, 2023. The HGR Implementing Rules further clarified that a domestic entity actually controlled by non-PRC entities/individual through investment or contractual arrangements may also be deemed a Restricted Entity, to the extent that such non-PRC entities/individuals can exercise control or significant influence over the decision-making and management of such domestic entity. This would potentially cover the VIE arrangement adopted by us. On May 1, 2024, regulatory authority for HGR management was transferred from the Ministry of Science and Technology (MOST) to the National Health Commission (NHC) pursuant to State Council Order No. 777. The NHC Department of Science and Education now oversees HGR activities. We cannot assure you that Yubo Beijing, as a VIE, will not be deemed a Restricted Entity in the future, given the newly released HGR Implementing Rules. If Yubo Beijing is deemed a Restricted Entity by relevant government authority, we will be required to obtain approvals or file with relevant government authority which could result in additional cost and our business, financial condition and results of operations will be adversely affected.

Because Yubo Beijing has significant operations in China, our performance is influenced not only by domestic factors within the PRC but also by global economic conditions and geopolitical tensions with far-reaching implications. In recent years, macroeconomic uncertainty and geopolitical conflicts—such as the ongoing war between Russia and Ukraine, military conflicts in the Middle East, ongoing tensions between the United States and China—have heightened volatility in global markets. These conditions have disrupted global supply chains, increased inflationary pressures, and created uncertainty for commerce, all of which could adversely affect our operations in China. The ongoing friction between the United States and China, and potential tariff or trade policy shifts may introduce risks of sanctions, export controls, or other restrictions that could impair our supply chain or limit our market access.

The Holding Foreign Companies Accountable Act (the “HFCA Act”) was enacted on December 18, 2020. In accordance with the HFCA Act, as originally passed, trading in securities of any registrant on a national securities exchange or in the over-the-counter trading market in the United States may be prohibited if the PCAOB determines that it cannot inspect or fully investigate the registrant’s auditor for three consecutive years beginning in 2021, and, as a result, an exchange may determine to delist the securities of such registrant. On June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act, which,which wouldwas amendsigned into law on December 29, 2022 as part of the Consolidated Appropriations Act, 2023. This legislation amended the HFCA Act and requirerequired the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three, thus reducing the time period before our securities may be prohibited from trading or delisted if our auditor is unable to meet the PCAOB inspection requirement. Following the PCAOB’s December 15, 2022 determination that it was able to secure complete access to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong, the SEC confirmed that issuers were not at risk of having their securities subject to a trading prohibition under the HFCAA so long as there remained continued access for complete inspections and investigations on an ongoing basis. However, if the PCAOB determines in any future reporting period that it is unable to inspect or investigate completely our auditor, the trading prohibition could apply after two consecutive years of such determination. See “Item 1. Business—Regulatory Developments—Holding Foreign Companies Accountable Act” for a detailed description of the regulatory developments on the HFCA Act.

The inabilityPCAOB previously determined that it was unable to performinspect inspectionsor preventsinvestigate thecompletely PCAOBregistered frompublic fullyaccounting evaluatingfirms audits and quality control procedures of the auditors basedheadquartered in mainland China and Hong Kong.Kong, Asbut avacated result,those investorsdeterminations mayon beDecember deprived15, of2022 after securing complete access. If, in the benefits of such PCAOB inspections. The inability offuture, the PCAOB determines again that it is unable to conduct inspectionsinspections, ofsuch auditorsinability inwould China and Hong Kong makesmake it more difficult to evaluate the effectiveness of these accounting firm’s audit procedures and quality control procedures as compared to auditors outside of China that are subject to the PCAOB inspections.

Our auditor, HHLHCL LLP,PLLC, an independent registered public accounting firm that is headquartered in the United States, as an auditor of companies that are traded publicly in the United States and a firm registered with the PCAOB, is subject to laws in the United States pursuant to which the PCAOB conducts inspections to assess its compliance with the applicable professional standards. Our auditor is subject to inspection by the PCAOB on a regular basis. However, we cannot assure you whether OTC Markets or regulatory authorities would apply additional and more stringent criteria to us after considering the effectiveness of our auditor’s audit procedures and quality control procedures, adequacy of personnel and training, or sufficiency of resources, geographic reach, or experience as it relates to our audit. If it is later determined that the PCAOB is unable to inspect or investigate completely our auditor because of a position taken by an authority in a foreign jurisdiction or any other reasons, the lack of inspection could cause the trading in our securities to be prohibited under the Holding Foreign Companies Accountable Act,Act after two consecutive years of such determination, and as a resultresult, the SEC may prohibit the trading of our securities and OTC Markets may delist our securities. If our securities are unable to be listed on another securities exchange, such a delisting would substantially impair your ability to sell or purchase our securities when you wish to do so, and the risk and uncertainty associated with a potential delisting would have a negative impact on the price of our Class A common stock.

In order for our common stock to become eligible for listing or quotation on any national stock exchange, reverse merger companies must have had their securities traded on an over-the-counter market for at least one year, maintained a certain minimum closing price for not less than 30 of the most recent 60 days prior to the filing of an initial listing application and prior to listing, and timely filed with the SEC all required reports since consummation of the reverse merger, including one annual report containing audited consolidated financial statements for a full fiscal year commencing after the date of filing of the Current Report on Form 8-K which discloses the reverse merger. WeIn may not be ableaddition to these requirements, we must meet all ofinitial thelisting filingstandards requirementsfor abovelisting andour mayshares noton a national exchange. We cannot guarantee that we will be able to satisfy the initial standards for listing or quotation on any exchangerequirements in the foreseeable future or at all. Even if we are able to become listed or quoted on an exchange, we may not be able to maintain a listing of the common stock on such stock exchange.

Our authorized common stock is divided into Class A common stock and Class B common stock. Holders of Class A common stock are entitled to one vote per share, while holders of Class B common stock are entitled to five votes per share. Each share of Class B is convertible into one share of Class A common stock upon notice of the holder, while Class A common stock is not convertible into Class B common stock under any circumstances. As of the date of this Annual Report, we have authorized (i) 1,000,000,000 shares of Class A common stock, of which 119,816,343170,416,343 shares were issued and outstanding, and (ii) 3,750,000 shares of Class B common stock, of which 4,447 shares were issued and outstanding. Currently, the holder of Class A common stock will have the ability to control matters requiring shareholders’ approval, including any amendment of our memorandum and articles of association.incorporation and bylaws. However, any future issuances of Class B common stock may be dilutive to the voting power of holders of Class A common stock. Any conversions of Class B common stock into Class A common stock may dilute the percentage ownership of the existing holders of Class A common stock within their class of ordinary shares.

Certain of our executive officers, directors and large stockholders own a significant percentage of our outstanding capital stock. As of the date of this Annual Report, our executive officers, directors, holders of 5% or more of our capital stock and their respective affiliates owned approximatelyover 77.9%80% of our outstanding shares of common stock. Accordingly, our directors and executive officers have significant influence over our affairs due to their substantial ownership coupled with their positions on our management team and have substantial voting power to approve matters requiring the approval of our stockholders. For example, these stockholders may be able to control elections of directors, amendments of our organizational documents, or approval of any merger, sale of assets, or other major corporate transaction. This concentration of ownership may prevent or discourage unsolicited acquisition proposals or offers for our common stock that some of our stockholders may believe is in their best interest.

Yubo Beijing’s manufacturing and commercialization strategy is based on establishing a fully integrated vein-to-vein product delivery cycle. Over time, Yubo Beijing expects to establish regional or zonal manufacturing hubs to service major markets to meet projected needs for commercial sale quantities. Yubo Beijing is also in the process of establishing manufacturing capability in Chengdu which will provide a regional product supply as well as add to its global manufacturing ability. However, Yubo Beijing is still in the process of constructing manufacturing and storage facilities that will allow it to meet commercial sale quantities.

Yubo Beijing sells its products and services to customers either directly or indirectly through distributors. Yubo Beijing depends on a small number of customers for a large percentage of its annual revenue. For the yearyears ended December 31, 2025 and 2024, one customer accounted for 100% of its total revenues, and for year ended December 31, 2022, one customer accounted for 37% of its total revenues.

As sales of Yubo Beijing’s private label products increasingly account for a substantial portion of its revenue, Yubo Beijing considers its brand name, trade names and trademarks to be valuable assets. Under PRC law, Yubo Beijing has the exclusive right to use a trademark for products for which such trademark has been registered with the PRCChina TrademarkNational OfficeIntellectual of StateProperty Administration for Industry and Commerce (“SAICCNIPA”). In addition, no assurances can be given that Yubo Beijing will be able to obtain any trademarks for which it may apply in the future.

We are a reporting company with the SEC and therefore must comply with Sarbanes-Oxley Act and SEC rules concerning internal controls. It is time consuming,time-consuming, difficult and costly for us to develop and implement the internal controls and reporting procedures required by the Sarbanes-Oxley Act. In order to expand our operations, we will need to hire additional financial reporting, internal control, and other finance staff in order to develop and implement appropriate internal controls and reporting procedures.

Yubo Beijing conducts the day-to-day business operations of our Company in China through contractual arrangements with our subsidiaries. Yubo Beijing is a VIE based in China and as such, we do not own any equity interest in Yubo Beijing or any of its subsidiaries. Investors in our Class A common stock currently do not hold, and may never hold, any equity interest, directly or indirectly, in Yubo Beijing or any of its subsidiaries. Yubo Beijing is a technology company focused on the research and development and application of endometrial stem cells. Yubo Beijing is committed to building what we believe to be the first public endometrial stem cell repository in the world. Yubo Beijing offers its products and services under the brand “VIVCELL.” Yubo Beijing’s product offerings include healthcare products for respiratory system, skincare products, hair care products, healthy beverages and male and female personal care products. Yubo Beijing also offers stem cell related services including cell testing and health management consulting services.

Our Management’s Discussion and Analysis of Financial Condition and Results of Operations section discusses our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. On an on-going basis, management evaluates its estimates and judgments, including those related to accrued expenses, financing operations, and contingencies and litigation. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.circumstances. The most significant accounting estimates inherent in the preparation of our financial statements include estimates as to the appropriate carrying value of certain assets and liabilities which are not readily apparent from other sources. We consider certain accounting policies related to fair value measurements and earnings per share to be critical accounting policies that require the use of significant judgments and estimates relating to matters that are inherently uncertain and may result in materially different results under different assumptions and conditions.

The cost of goods sold was $4,188 for the year ended December 31, 2025, as compared to $822 for the year ended December 31, 2024, asan comparedincrease toof $185,491$3,366 foror the year ended December 31, 2023.409%. The decreaseincrease in cost of goods sold was due to aan decreaseincrease in sales.

Our gross profit was $8,165 for the year ended December 31, 2025, as compared to $2,648 for the year ended December 31, 2024, asan comparedincrease toof $419,185$5,517 foror the year ended December 31, 2023.208%. The decreaseincrease in gross profit was primarily due to aan decreaseincrease in sales.

Our loss from operations was $1,187,696 for the year ended December 31, 2025, as compared to a loss from operations of $1,769,919 for the year ended December 31, 2024, as compared to a loss from operationsdecrease of $1,194,706582,223 foror the year ended December 31, 2023.33%. The increasedecrease in our loss from operations was primarily due to an increasedecrease in operating expenses and a decrease in gross profit.expenses.

Our other expense was $243 for the year ended December 31, 2025, as compared to other expense of $211,873 for the year ended December 31, 2024, asa compared to other expensedecrease of $377$211,630 foror the year ended December 31, 2023.100%. The increasedecrease in other expenseexpenses was primarily due to aloss writeon offobsolete inventory in the third quarter of inventory.2024, which did not recur in fiscal year 2025.

Our net loss was $1,187,939 for the year ended December 31, 2025, as compared to $1,981,792 for the year ended December 31, 2024, asa compareddecrease toof $1,195,083$793,853 foror the year ended December 31, 2023.40%. The increasedecrease in net loss was primarily due to a decrease in sales and an increase in operating expenses.

As of December 31, 2024,2025, we had cash and cash equivalents on hand of $7,015$8,062 and a negative working capital of $4,038,998.$2,123,785. Generally, the primary sources of our funds have been loans from our shareholders and capital contributions. On March 31, 2025,2026, we obtained a financial support letter from Jun Wang, our largest shareholder and our president and a director. Pursuant to the financial support letter, Jun Wang has agreed to undertake to provide continuous financial support to enable us to meet our liabilities as and when they become due for a period of 12 months from the date of this annual report. With such financial support letter, we believe that our cash on hand and working capital will be sufficient to meet our and Yubo Beijing’s anticipated cash requirements through the first half of 2025.2026. We intend to continue working toward identifying and obtaining new sources of financing and may raise additional capital in 2025.2026. No assurances can be given that we will be successful in obtaining additional financing in the future. Any future financing that we may obtain may cause significant dilution to existing stockholders. Any debt financing or other financing of securities senior to common stock that we are able to obtain will likely include financial and other covenants that will restrict our flexibility. Any failure to comply with these covenants would have a negative impact on our business, prospects, financial condition, results of operations and cash flows.

Net cash used in operating activities was $1,337,729$842,802 for the year ended December 31, 2024,2025, as compared to net cash used in operating activities of $738,971$1,337,729 for the year ended December 31, 2023.2024, a decrease of $494,927 or 37%. The increasedecrease in net cash used in operating activities was primarily due to an increase in net loss for the year endedwas Decemberprimarily 31,driven 2024.by a reduction in our net loss.

Net cash provided by investing activities was $118,431$nil for the year ended December 31, 2024,2025, as compared to net cash provided by investing activities of $nil$118,431 for the year ended December 31, 2023.2024, a decrease of $118,431 or 100%. The increasedecrease in net cash provided by investing activities was primarily due to decrease in sale of equipment.

Net cash provided by financing activities was $849,545 for the year ended December 31, 2025, as compared to $1,407,139 for the year ended December 31, 2024, asa compareddecrease toof $745,659557,594 foror the year ended December 31, 2023.40%. The increasedecrease in net cash provided by financing activities was primarily due to increasethe inless shareholderfinancial loans.support from related parties.

We also had certain short-term borrowings from our directors totaling $2,891,895$1,211,440 as of December 31, 2024, respectively.2025. See “Item 13. Certain Relationships and Related Transactions, and Director Independence.”

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited consolidated financial statements for the three and six months ended MarchJune 31,30, 2026 and 2025 included under “Part I Financial Information—Item 1. Financial Statements” of this Quarterly Report. In addition to historical information, this discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors, including, but not limited, to those set forth under “Part II Other Information—Item 1A. Risk Factors” and elsewhere in our Annual Report on Form 10-K filed with the SEC on March 31, 2026.

As of the date of this Quarterly Report, HHL LLP (“HHL”), our auditor, HCL PLLC, an independent registered public accounting firm thatfirm, is headquartered in theNew UnitedYork, States,New York, and as an auditor of companies that are traded publicly in the United States and a firm registered with the PCAOB, is subject to laws in the United States pursuant to which the PCAOB conducts inspections to assess its compliance with the applicable professional standards. Our auditor is subject to inspection by the PCAOB on a regular basis. However,As noted above, on December 15, 2022, the PCAOB issued a report that vacated the 2021 PCAOB determinations and removed mainland China and Hong Kong from the list of jurisdictions where it is unable to inspect or investigate completely registered public accounting firms. Each year, the PCAOB will determine whether it can inspect and investigate completely audit firms in mainland China and Hong Kong, among other jurisdictions. Although our auditor is headquartered in the United States, we cannot assure you whether OTC Markets or regulatory authorities would not in the future apply additional and more stringent criteria to us after considering the effectiveness of our auditor’s audit procedures and quality control procedures, adequacy of personnel and training, or sufficiency of resources, geographic reach, or experience as it relates to our audit. If it is later determined that the PCAOB is unable to inspect or investigate completely our auditor because of a position taken by an authority in a foreign jurisdiction or any other reasons, the lack of inspection could cause the trading in our securities to be prohibited under the Holding Foreign Companies Accountable Act after two consecutive years of such determination,Act, and as a result,result theOTC SECMarkets may prohibitdelist or suspend the trading of our securitiesClass andA OTCcommon Markets may delist our securities.stock. If our securitiesClass areA common stock is unable to be listed on another securities exchange, such a delisting or suspension would substantially impair your ability to sell or purchase our securities when you wish to do so, and the risk and uncertainty associated with a potential delisting would have a negative impact on the price of our Class A common stock.

This section discusses our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. On an on-going basis, management evaluates its estimates and judgments, including those related to accrued expenses, financing operations, and contingencies and litigation. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The most significant accounting estimates inherent in the preparation of our financial statements include estimates as to the appropriate carrying value of certain assets and liabilities which are not readily apparent from other sources. We consider certain accounting policies related to fair value measurements and earnings per share to be critical accounting policies that require the use of significant judgments and estimates relating to matters that are inherently uncertain and may result in materially different results under different assumptions and conditions. See Note 2 – Summary of Significant Accounting Policies to our unaudited consolidated financial statements for the three months ended MarchJune 31,30, 2026 and 2025 included elsewhere in this Quarterly Report.

Results of Operations for the Three Months Ended MarchJune 31,30, 2026 Compared to the Three Months Ended MarchJune 31,30, 2025, and for the Six Months Ended June 30, 2026 Compared to the Six Months Ended June 30, 2025

Our sales were nil$0 for each ofboth the threesix months ended MarchJune 31,30, 2026 and March 31, 2025. As a result, our cost of goods sold and gross profit were nilalso $0 for eachboth of the three months ended March 31, 2026 and March 31, 2025.periods. Based on our current status, due to changes in the market environment, the Company has continued to conduct market research and evaluation, including assessment of market outlook, risk factors and compliance considerations. The Company has also been actively exploring more effective sales approaches and distribution channels. As a result, the Company has not yet generated revenue from these products during the relevant period.

Our loss from operations decreased by $10,839, or 4.3%, to $238,860 for the three months ended MarchJune 31,30, 2026 was $289,274, as compared to a loss from operations of $467,299$249,699 for the samethree periodmonths inended June 30, 2025, a decrease of $178,025 or 38%. The decrease in loss from operations was primarily attributable toreflecting the decrease in operating expenses.

OurWe recorded other expense of $29,860 for the three months ended MarchJune 31,30, 2026 was $5,752, as2026, compared towith $19other expense of $23 for the samethree periodmonths inended June 30, 2025. The increase in other expensesexpense was primarily due to bad debt recognized during the quarter.

Our net loss decreased by $28,389, or 4.8%, to $563,747 for the threesix months ended MarchJune 31,30, 2026 wasfrom $295,026, as compared to a net loss of $467,318$592,136 for the samesix periodmonths inended 2025,June a30, decrease of $172,292 or 37%.2025. The decrease in net loss was primarily due to lower operating expenses, which was partially offset by the change to other expense items.

Our material cash requirements as of MarchJune 31,30, 2026 and any subsequent interim period primarily include our capital expenditures, operating lease commitments, and working capital requirements.

As of MarchJune 31,30, 2026, we had cash and cash equivalents on hand of $10,382$11,989 and a negative working capital of $2,421,628.$2,744,500. Generally, the primary sources of our funds have been loans from our shareholders and capital contributions. On March 31, 2026, we obtained a financial support letter from Jun Wang, our largest shareholder and our president and a director. Pursuant to the financial support letter, Jun Wang has agreed to undertake to provide continuous financial support to enable us to meet our liabilities as and when they become due for a period of 12 months following March 31, 2026. With such financial support letter, we believe that our cash on hand and working capital will be sufficient to meet our and Yubo Beijing’s anticipated cash requirements through 2026. We intend to continue working toward identifying and obtaining new sources of financing and we may raise additional capital in 2026. No assurances can be given that we will be successful in obtaining additional financing in the future. Any future financing that we may obtain may cause significant dilution to existing stockholders. Any debt financing or other financing of securities senior to common stock that we are able to obtain will likely include financial and other covenants that will restrict our flexibility. Any failure to comply with these covenants would have a negative impact on our business, prospects, financial condition, results of operations and cash flows.

Net cash provided by investing activities was $0 for the threesix months ended MarchJune 31,30, 2026 was nil, as2026, compared towith net cash used in investing activities of $6,186$79,904 for the samesix periodmonths inended 2025,June primarily30, due2025. toThe decrease reflected the absence of purchasesproceeds from sales of equipment duringin the quarter.2026.

Net cash provided by financing activities was $291,754 for the threesix months ended MarchJune 31,30, 2026 was $214,523, as2026, compared towith $277,780$473,919 for the samesix periodmonths inended 2025,June a30, decrease of $63,257 or 23%.2025. The decrease was primarily due toreflected lower net advances from related parties.

As of MarchJune 31,30, 2026, we had payables due to Mr. Jun Wang, our President and a director, in the amount of $1,242,319, to$1,364,268; Mr. Yang Wang, our Chief Executive Officer and a director, in the amount of $129,956,$129,956; to Mr.Ms. Huang Li, our indirect shareholder, in the amount of $55,786,$55,486; and to Mr. Yanxi Wang, our shareholder, in the amount of $374.

The accompanying interim unaudited consolidated financial statements for the three and six months ended MarchJune 31,30, 2026 and 2025 included an explanatory paragraph referring to our recurring operating losses and expressing substantial doubt in our ability to continue as a going concern. Our consolidated financial statements have been prepared on a going concern basis, which assumes the realization of assets and settlement of liabilities in the normal course of business. To date, we have not yet established an ongoing source of revenues and cash flows sufficient to cover our operating costs and allow us to continue as a going concern. For the three and six months ended MarchJune 31,30, 2026, we had net losses of $295,026.$268,721 and $563,747, respectively. These factorsfactors, among othersothers, raise substantial doubt about our ability to continue as a going concern for a reasonable period of time.