GD Culture Group Ltd
For the period ended Sep 30, 2025. Filed Nov 3, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 3, 2025
GDC$1.20+9.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-12.
0001213900-25-074991
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-03.
0001213900-25-104943
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 67 previous paragraphs and 77 current paragraphs.
43 unchanged; 17 reworded; 16 added; 6 removed; 1 previous and 1 current paragraphs rearranged.
Tables are not compared: 3 previous and 3 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (16)
Current report
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Current report
On October 24, 2025, the Company entered into securities purchase agreements (the “October 2025 Securities Purchase Agreement”) with certain accredited investor, pursuant to which the Company agreed to issue and sell, in a private placement (the “October 2025 Private Placement”), an aggregate of 1,333,334 shares of the Company’s common stock at a purchase price of $2.10 per share, for gross proceeds in the amount of $2,800,000. The Company plans to use the process for working capital and general corporate purposes.
Current report
In connection with the October 2025 Private Placement, on October 24, 2025, the Company entered into a placement agency agreement (the “October 2025 Placement Agency Agreement”) with Univest (the “Placement Agent”). The Company agreed to pay the Placement Agent a total cash fee equal to seven percent (7%) of the aggregate gross proceeds raised in the October 2025 Private Placement. The Company has also agreed to reimburse the Placement Agent for all reasonable and out-of-pocket expenses incurred in connection with the Private Placement, including reasonable fees and expenses of the Placement Agent’s legal counsel and due diligence analysis up to $20,000. The Company also paid $40,000 legal fee to third party upon closing of the October 2025 Private Placement.
Current report
Acquisition of Pallas
Current report
On September 8 2025, the Company (the “Acquirer”), Pallas Capital Holding Ltd, a British Virgin Islands company incorporated on June 30, 2025 ( “Pallas” or the “Target”), and the shareholders of the Target (each a “Seller” and collectively, the “Sellers”) executed an agreement and plan of securities exchange (the “Share Exchange Agreement”, and the transactions contemplated thereby, collectively, the “Transaction”), pursuant to which, the Sellers wish to sell to the Acquirer, and the Acquirer wishes to purchase from the Sellers, 100% interest in and to the ordinary shares of the Target (the “Target Shares”). In exchange for the Target Shares, the Acquirer shall issue an aggregate of 39,189,344 shares of the Company’s common stock (the “GDC Shares”), of the Acquirer in book entry form in such amount and to such Sellers. On September 29, 2025, the Sellers transferred to Acquirer 10,000 shares of Target Shares, being all of the issued and outstanding ordinary shares of the Target, and received in exchange certificates representing the 39,189,344 GDC Shares. Thereafter, Pallas became a wholly-owned subsidiary of the Company.
Current report
Pallas was established for the primary purpose of holding digital assets as a long-term reserve, with the objective of achieving potential appreciation in value. As of September 30, 2025, Pallas held 7,500 units of Bitcoin.
Current report
The Transaction is accounted for as an asset acquisition, as the Target’s assets primarily consist of digital assets (Bitcoin). The purchase consideration is measured based on the fair value of the Company’s common stock issued as consideration.
Current report
Two shareholders of the Company, who beneficially own 11.4%, in the aggregate, of the outstanding shares of common stock of the Company, immediately before the execution of the Transaction, are the directors and share voting and dispositive power over the shares issued by the Target. Accordingly, the Transaction constitutes a related party transaction for the Company pursuant to Item 404 of Regulation S-K. Given the related party nature of the Transaction and the fact that the acquired digital assets are highly liquid and have observable market prices, management concluded that the fair value of the assets acquired is more reliably measurable than the fair value of the common stock issued as consideration.
Current report
As a result, management determined that the Transaction lacks commercial substance and, in substance, represents a capital contribution from the related shareholders. Accordingly, the excess of the fair value of the digital assets acquired over the fair value of the common stock issued is recorded as an increase in investment with a corresponding credit to additional paid-in capital.
Current report
Other Income
Current report
Net Income (Loss)
Current report
The Company achieved profitability during the three months ended September 30, 2025, generating net income of $12,088,469, compared to a net loss of $3,839,333 for the three months ended September 30, 2024. The improvement in results was primarily attributable to an unrealized gain of $16,230,431 arising from fair value changes of digital assets and the absence of other-than-temporary impairment losses on intangible assets for the three months ended September 30, 2025, as compared to the same period in 2024.
Current report
Other Income
Current report
Net Income (Loss)
Current report
The Company achieved profitability during the nine months ended September 30, 2025, generating net income of $9,611,905, compared to a net loss of $11,589,784 for the three months ended September 30, 2024. The improvement in results was mainly driven by an increase in the unrealized gain arising from fair value changes of digital assets, the absence of other-than-temporary impairment losses on intangible assets and convertible notes for the nine months ended September 30, 2025, as compared to the same period in 2024.
Current report
On October 24, 2025, the Company sold 1,333,334 shares of common stock at $2.1 per share, generating gross proceeds of $2.8 million. The Company received net proceeds of approximately $2.5 million after deducting underwriter’s fees of $196,000 and other offering costs of $60,000. The Company plans to use the proceeds from the offering for working capital purposes.
Removed paragraphs (6)
Previous report
Other Income, Net
Previous report
Net Loss
Previous report
The Company’s net loss decreased by $2,093,858, or 58.3%, to $1,499,054 for the three months ended June 30, 2025, from $3,592,912 for the three months ended June 30, 2024. The decrease was mainly driven by lower operating expenses, as discussed above.
Previous report
Other Income, Net
Previous report
Net Loss
Previous report
The Company’s net loss decreased by $5,273,887, or 68.0%, to $2,476,564 for the six months ended June 30, 2025, from $7,750,451 for the six months ended June 30, 2024. The decrease was mainly driven by lower operating expenses, as discussed above.
Reworded paragraphs (17)
Previous wording
On March 4, 2025, the Company entered into a securities purchase agreement (the “March 2025 Securities Purchase Agreement”) with certain investor for the sale of 1,115,600 shares of common stock at $0.896379 per share (the “March 2025 Offering”), generating gross proceeds in the amount of $1,000,000, before deducting underwriter’s fees and accountable expenses and other estimated expenses. The Company plans to use the proceeds from the offering for working capital purposes. Upon closing of the March 2025 Offering, the Company paid $90,000 cash for underwriting, which consists of a total cash fee of $70,000, equal to seven percent (7%) of the aggregate gross proceeds raised in the March 2025 Offering and reimbursement of reasonable fees and expenses of $20,000 for the underwriter’s legal counsel and due diligence analysis expenses.
Current wording
On March 4, 2025, the Company entered into a securities purchase agreement (the “March 2025 Securities Purchase Agreement”) with certain investor for the sale of 1,115,600 shares of common stock at $0.896379 per share (the “March 2025 Offering”), generating gross proceeds in the amount of $1,000,000, before deducting underwriter’s fees and accountable expenses and other estimated expenses. The Company used the proceeds from the offering for working capital purposes. Upon closing of the March 2025 Offering, the Company paid $90,000 cash for underwriting, which consists of a total cash fee of $70,000, equal to seven percent (7%) of the aggregate gross proceeds raised in the March 2025 Offering and reimbursement of reasonable fees and expenses of $20,000 for the underwriter’s legal counsel and due diligence analysis expenses.
Previous wording
On May 2, 2025, the Company entered into a securities purchase agreement (the “May 2025 Securities Purchase Agreement”) with certain investors for the sale of 1,115,600 shares of common stock at approximately $0.524 per share and 9,380,582 pre-funded warrants (the “May 2025 Pre-Funded Warrants”) at approximately $0.523 per warrant (the “May 2025 Offering”). Up to the date of the unaudited condensed interim financial statements were issued, The Company received $4,478,000 in proceeds for subscription of 1,115,600 shares of its common stock and 7,468,536 pre-funded warrants. The offering remains ongoing and has not yet been fully completed. Transaction costs incurred through the reporting date included underwriter’s fees of $313,460 and a $20,000 reimbursement for the underwriter’s legal counsel and due diligence expenses. Net proceeds from the offering, after deducting these expenses, will be $5,095,000. The Company intends to use the proceeds from the offering for working capital purposes.
Current wording
On May 2, 2025, the Company entered into a securities purchase agreement (the “May 2025 Securities Purchase Agreement”) with certain investors for the sale of 1,115,600 shares of common stock at approximately $0.524 per share and 9,380,582 pre-funded warrants (the “May 2025 Pre-Funded Warrants”) at approximately $0.523 per warrant (the “May 2025 Offering”). Up to the date of the unaudited condensed interim financial statements were issued, The Company received $4,478,000 in proceeds for subscription of 1,115,600 shares of its common stock and 7,468,536 pre-funded warrants. The offering remains ongoing and has not yet been fully completed. Transaction costs incurred through the reporting date included underwriter’s fees of $313,460 and a $20,000 reimbursement for the underwriter’s legal counsel and due diligence expenses. Net proceeds from the offering, after deducting these expenses, will be $5,095,000. As of September 30, 2025, the Company used the proceeds from the offering for working capital purposes.
Previous wording
On May 11, 2025, the Company entered into a Common Stock Purchase Agreement with an investor, pursuant to which the Company shall have the right to require the investor to purchase, from time to time, up to a cumulative total of $300,000,000 worth of the Company’s common stock. The Company plans to use the proceeds from the offering, if any, to invest in Bitcoin and OFFICIAL TRUMP and for general corporate purposes. The common stock will be issued and sold by the Company to the investor pursuant to a registration statement effective under the Securities Act of 1933, as amended (the “Securities Act”) or, if there is no effective registration statement registering, or no current prospectus available for the issuance of the common stock issuable pursuant to the Agreement, in reliance upon the exemptions from the registration requirements of the Securities Act afforded by Section 4(a)(2) of the Securities Act and Rule 506(b) of Regulation D promulgated thereunder.
Current wording
On May 11, 2025, the Company entered into a Common Stock Purchase Agreement with an investor, pursuant to which the Company shall have the right to require the investor to purchase, from time to time, up to a cumulative total of $300,000,000 worth of the Company’s common stock. The Company plans to use the proceeds from the offering, if any, to invest in Bitcoin and OFFICIAL TRUMP and for general corporate purposes. The common stock will be issued and sold by the Company to the investor pursuant to a registration statement effective under the Securities Act of 1933, as amended (the “Securities Act”) or, if there is no effective registration statement registering, or no current prospectus available for the issuance of the common stock issuable pursuant to the Agreement, in reliance upon the exemptions from the registration requirements of the Securities Act afforded by Section 4(a)(2) of the Securities Act and Rule 506(b) of Regulation D promulgated thereunder. On September 29, 2025, the Company issued 39,189,344 shares of common stock for acquisition of Bitcoin, as disclosed below, in section “Acquisition of Pallas”.
Previous wording
The Company’s operating expenses include selling and marketing (“S&M”) expenses, general and administrative (“G&A”) expenses, research and development (“R&D”) expenses. S&M expenses increased to $300,000 for the three months ended June 30, 2025, as compared to $208,333 for the three months ended June 30, 2024. The increase was mainly due to rise in brand marketing expenses, partially offset by the Company’s decreased inputs on digital human and e-commerce live streaming marketing and advertising, driven by the uncertainty surrounding TikTok’s potential exit from the U.S. G&A expenses decreased by $680,361 from $1,703,091 for the three months ended June 30, 2024 to $1,022,730 for the three months ended June 30, 2025, primarily due to a reduction in professional fees. R&D expenses increased by $15,833, from $217,500 for the three months ended June 30, 2024 to $233,333 for the three months ended June 30, 2025. The increase was mainly attributable to research and development support activities for the newly purchased software, Chat Box. This increase was partially offset by decreased inputs in research and development related to the Company’s artificial intelligence-based digital human application.
Current wording
The Company’s operating expenses include selling and marketing (“S&M”) expenses, general and administrative (“G&A”) expenses, research and development (“R&D”) expenses. S&M expenses decreased to nil for the three months ended September 30, 2025, as compared to $2,909 for the three months ended September 30, 2024. The decrease was mainly due to the Company’s decreased inputs on brand marketing expenses. G&A expenses increased by $356,759 from $873,067 for the three months ended September 30, 2024 to $1,229,826 for the three months ended September 30, 2025, primarily due to the increase in short-term rental expenses, amortization of intangible assets and travel expenses. R&D expenses increased by $1,018,833, from $217,500 for the three months ended September 30, 2024 to $1,236,333 for the three months ended September 30, 2025. The increase was mainly attributable to research and development support activities for the newly purchased software, Chat Box and expenses incurred for development of AI immersive reading platform. This increase was partially offset by decreased inputs in research and development related to the Company’s artificial intelligence-based digital human application.
Previous wording
The Company’s other income decreased by $10,877 during the three months ended June 30, 2025, compared to $13,056 for the three months ended June 30, 2024. The decrease was mainly due to the absence of interest income for the three months ended June 30, 2025, which had been earned from a loan to a third party in 2024.
Current wording
The Company’s other income increased by $16,222,229, from $10,381 for the three months ended September 30, 2024, to $16,232,610, during the three months ended September 30, 2025. The increase was mainly due to the unrealized gain of $16,230,431 arising from fair value changes of digital assets, partially offset by the absence of interest income for the three months ended September 30, 2025, which had been earned from a loan to a third party in 2024.
Previous wording
Six Months Ended June 30, 2025 vs. June 30, 2024
Current wording
Nine Months Ended September 30, 2025 vs. September 30, 2024
Previous wording
The Company’s operating expenses include selling and marketing (“S&M”) expenses, general and administrative (“G&A”) expenses, research and development (“R&D”) expenses. S&M expenses decreased to $300,000 for the six months ended June 30, 2025, compared to $2,400,000 for the six months ended June 30, 2024. The decrease was mainly due to the Company decreased inputs on digital human and e-commerce live streaming marketing and advertising due to the uncertainty surrounding TikTok’s potential exit from the U.S. G&A expenses decreased by $1,511,764 from $3,472,371 for the six months ended June 30, 2024 to $1,960,607 for the six months ended June 30, 2025. The decrease was mainly due to the decrease in the professional service fee, partially offset by the increase in amortization of intangible assets and listing fee. R&D expenses decreased to $233,333 for the six months ended June 30, 2025, compared to $435,000 for the six months ended June 30, 2024. The decrease was mainly due to the Company decreased inputs on research and development about our artificial intelligence based digital human application. This decrease was partially offset by research and development support activities for the newly purchased software, Chat Box.
Current wording
The Company’s operating expenses include selling and marketing (“S&M”) expenses, general and administrative (“G&A”) expenses, research and development (“R&D”) expenses. S&M expenses decreased to $300,000 for the nine months ended September 30, 2025, compared to $2,402,909 for the nine months ended September 30, 2024. The decrease was mainly due to the Company decreased inputs on digital human and e-commerce live streaming marketing and advertising due to the uncertainty surrounding TikTok’s potential exit from the U.S. G&A expenses decreased by $1,155,005 from $4,345,438 for the nine months ended September 30, 2024 to $3,190,433 for the nine months ended September 30, 2025. The decrease was mainly due to the decrease in the professional service fee, partially offset by the increase in amortization of intangible assets and short-term lease expenses. R&D expenses increased to $1,469,666 for the nine months ended September 30, 2025, compared to $652,500 for the nine months ended September 30, 2024. The increase was mainly due to research and development support activities for the newly purchased software, Chat Box and expenses incurred for development of AI immersive reading platform. This increase was partially offset by the decreased inputs on research and development about our artificial intelligence based digital human application.
Previous wording
The Company’s other income decreased by $30,705 during the six months ended June 30, 2025, compared to $35,002 for the six months ended June 30, 2024. The decrease was mainly due to the absence of interest income for the three months ended June 30, 2025, which had been earned from a loan to a third party in 2024.
Current wording
The Company’s other income increased by $16,191,524 during the nine months ended September 30, 2025, from $45,383 for the nine months ended September 30, 2024, to $16,236,907 for the nine months ended September 30, 2025. The increase was mainly due to the unrealized gain of $16,230,431 arising from fair value changes of digital assets, partially offset by the absence of interest income for the nine months ended September 30, 2025, which had been earned from a loan to a third party in 2024.
Previous wording
As of June 30, 2025, the Company had $1,117,760 in its operating bank accounts and working capital of approximately $1.5 million. From September 2024 to January 2025, Mr. Xiaojian Wang, the Chief Executive Officer of the Company (“CEO”), lent $399,485 to the Company through six loan agreements, for working capital purposes. Pursuant to the loan agreements, these loans are non-interest bearing and will be due from September 2025 to January 2026, respectively. From March 2025 to May 2025, the Company repaid $399,485 in full to the CEO. Up to the date of the unaudited interim condensed consolidated financial statements were issued, there was no outstanding loan from the CEO.
Current wording
As of September 30, 2025, the Company had $225,072 in its operating bank accounts and working capital deficit of approximately $2.3 million. From September 2024 to January 2025, Mr. Xiaojian Wang, the Chief Executive Officer of the Company (“CEO”), lent $399,485 to the Company through six loan agreements, for working capital purposes. Pursuant to the loan agreements, these loans are non-interest bearing and will be due from September 2025 to January 2026, respectively. From March 2025 to May 2025, the Company repaid $399,485 in full to the CEO. Up to the date of the unaudited interim condensed consolidated financial statements were issued, there was no outstanding loan from the CEO.
Previous wording
On March 4, 2025, the Company sold 1,115,600 shares of common stock at $0.896379 per share, generating gross proceeds of $1,000,000. The Company received net proceeds of $910,000 after deducting underwriter’s fees of $70,000 and a $20,000 reimbursement for the underwriter’s legal counsel and due diligence analysis expenses. The Company intends to use the proceeds from the offering for working capital purposes.
Current wording
On March 4, 2025, the Company sold 1,115,600 shares of common stock at $0.896379 per share, generating gross proceeds of $1,000,000. The Company received net proceeds of $910,000 after deducting underwriter’s fees of $70,000 and a $20,000 reimbursement for the underwriter’s legal counsel and due diligence analysis expenses. The Company used the proceeds from the offering for working capital purposes.
Previous wording
On May 2, 2025, the Company completed a securities offering in which it agreed to sell (i) 1,115,600 shares of its common stock at a purchase price of approximately $0.524 per share and (ii) 9,380,582 pre-funded warrants at a purchase price of approximately $0.523 per warrant. Up to the date of the unaudited condensed interim financial statements were issued, The Company received $4,478,000 in proceeds for subscription of 1,115,600 shares of its common stock and 7,468,536 pre-funded warrants, with $17,390 still outstanding and receivable from the investor. The offering remains ongoing and has not yet been fully completed. Transaction costs incurred through June 30, 2025 included underwriter’s fees of $313,343 and a $20,000 reimbursement for the underwriter’s legal counsel and due diligence expenses. After deducting these expenses, net proceeds from the offering (excluding the receivable of $17,390 from the investor) amounted to $4,143,657 as of June 30, 2025. The Company intends to use the proceeds from the offering for working capital purposes.
Current wording
On May 2, 2025, the Company completed a securities offering in which it agreed to sell (i) 1,115,600 shares of its common stock at a purchase price of approximately $0.524 per share and (ii) 9,380,582 pre-funded warrants at a purchase price of approximately $0.523 per warrant. Up to the date of the unaudited condensed interim financial statements were issued, The Company received $4,478,000 in proceeds for subscription of 1,115,600 shares of its common stock and 7,468,536 pre-funded warrants, with $17,390 still outstanding and receivable from the investor. The offering remains ongoing and has not yet been fully completed. Transaction costs incurred through September 30, 2025 included underwriter’s fees of $313,343 and a $20,000 reimbursement for the underwriter’s legal counsel and due diligence expenses. After deducting these expenses, net proceeds from the offering (excluding the receivable of $17,390 from the investor) amounted to $4,143,657. As of September 30, 2025, the Company used the proceeds from the offering for working capital purposes.
Previous wording
The following summarizes the key components of the Company’s cash flows for the six months ended June 30, 2025 and 2024.
Current wording
The following summarizes the key components of the Company’s cash flows for the nine months ended September 30, 2025 and 2024.
Previous wording
Net cash used in operating activities was approximately $3.7 million for the six months ended June 30, 2025, as compared to approximately $5.1 million net cash used in operating activities for the six months ended June 30, 2024. Net loss for the six months ended June 30, 2025 was approximately $2.5 million, as compared to approximately $7.8 million for the six months ended June 30, 2024. Adjustments to reconcile net loss to net cash used in operating activities decreased by approximately $1.6 million for the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, mainly due to the decreased other-than-temporary impairment losses from convertible note. Changes in operating assets and liabilities decreased approximately $2.3 million, for the six months ended June 30, 2025, as compared to the six months ended June 30, 2024, which was primarily driven by the increase of approximately $2.2 million in change of prepaid and other current assets.
Current wording
Net cash used in operating activities was approximately $4.6 million for the nine months ended September 30, 2025, as compared to approximately $5.3 million net cash used in operating activities for the nine months ended September 30, 2024. Net income for the nine months ended September 30, 2025 was approximately $9.6 million, as compared to a net loss of approximately $11.6 million for the nine months ended September 30, 2024. Adjustments to reconcile net income (loss) to net cash used in operating activities decreased by approximately $20.5 million for the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, mainly due to (i) the unrealized gain arising from fair value changes of digital assets for the nine months ended September 30, 2025 of approximately $16.2 million, (ii) the decreased other-than-temporary impairment losses from convertible note and intangible assets of approximately $4.3 million. Changes in operating assets and liabilities remained relatively flat for the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024. Specifically, the decrease in prepaid expenses and other current assets was largely offset by the increase in income taxes payable, resulting in minimal net impact on operating cash flows.
Previous wording
Net cash used in investing activities was nil for the six months ended June 30, 2025, as compared to approximately $0.7 million for the six months ended June 30, 2024. The decrease in net cash used in investing activities was due to the absence of the loan to a third party for the six months ended June 30, 2025, as compared to the same period of 2024.
Current wording
Net cash used in investing activities was nil for the nine months ended September 30, 2025, as compared to approximately $0.7 million for the nine months ended September 30, 2024. The decrease in net cash used in investing activities was due to the absence of the loan to a third party for the nine months ended September 30, 2025, as compared to the same period of 2024.
Previous wording
Net cash provided by financing activities was approximately $4.8 million for the six months ended June 30, 2025, compared to approximately $0.8 million for the six months ended June 30, 2024. The increase was mainly caused by i) an increase in proceeds from issuance of common stock, which rose by approximately $0.7 million to approximately $1.5 million for the six months ended June 30, 2025, compared to approximately $0.8 million in the same period of 2024; ii) proceeds from issuance of prefunded warrants, which totaled approximately $3.6 million in the six months ended June 30, 2025, compared to none for the six months ended June 30, 2024. These increase in the cash provided by financing activities were partially offset by a repayment to a related party of $0.4 million.
Current wording
Net cash provided by financing activities was approximately $4.8 million for the nine months ended September 30, 2025, compared to approximately $0.8 million for the nine months ended September 30, 2024. The increase was mainly caused by i) an increase in proceeds from issuance of common stock, which rose by approximately $0.7 million to approximately $1.5 million for the nine months ended September 30, 2025, compared to approximately $0.8 million in the same period of 2024; ii) proceeds from issuance of prefunded warrants, which totaled approximately $3.6 million in the nine months ended September 30, 2025, compared to nil for the nine months ended September 30, 2024. These increase in the cash provided by financing activities were partially offset by a repayment to a related party of $0.4 million.
Previous wording
The Company’s determination of whether or not an indication of impairment exists at the cash generating unit level requires significant management judgment pertaining to intangible assets, including a software copyright of AI Box, which is used for online living-stream and a software copyright of Chat Box, which is used for online interactive entertainment scenarios, as well as the operating Right-of-use (“ROU”) assets, including the offices of the Company. Management considers both external and internal sources of information in assessing whether there are any indications that the Company’s intangible assets and ROU assets are impaired. Based on the evaluation, the Company did not recognize impairment losses in long-lived assets for the six months ended June 30, 2025 and 2024.
Current wording
The Company’s determination of whether or not an indication of impairment exists at the cash generating unit level requires significant management judgment pertaining to intangible assets, including a software copyright of AI Box, which is used for online living-stream and a software copyright of Chat Box, which is used for online interactive entertainment scenarios, as well as the operating Right-of-use (“ROU”) assets, including the offices of the Company. Management considers both external and internal sources of information in assessing whether there are any indications that the Company’s intangible assets and ROU assets are impaired. Based on the evaluation, the Company recognized impairment losses in long-lived assets of nil and $2,756,986, respectively, for the nine months ended September 30, 2025 and 2024.
Previous wording
We do not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on our consolidated balance sheets, statements of operations and comprehensive loss and statements of cash flows.
Current wording
We do not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on our consolidated balance sheets, statements of operations and comprehensive income (loss) and statements of cash flows.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Pursuant to the October 2025 Securities Purchase Agreement, the Company has agreed to use commercially reasonable efforts to, within sixty (60) calendar days after the date of the October 2025 Securities Purchase Agreement, file a registration statement on the appropriate form providing for the resale by the Investor of the Shares.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
On May 31, 2024, the Company entered into a software purchase agreement with Shanxi Gangdong Cultural Media Co., Ltd., a seller unaffiliated with the Company (the “SGCM”). Pursuant to the agreement, the Company agreed to purchase and the SGCM agreed to sell all of SGCM’s right, title, and interest in and to the certain software (the “AIBox”). The purchase price of the software shall be $1,248,000, payable in the form of an issuance of 1,560,000 shares of common stock of the Company, valued at $0.80 per share. The Company plans to use the software to develop its AI business. On June 4, 2024, the Company issued 1,560,000 shares of common stock of the Company to the SGCM’s designees and the transaction was completed.