LQR House Inc.
For the period ended Dec 31, 2025. Filed Apr 15, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Apr 15, 2026
YHC$1.51-6.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-03-31.
0001213900-25-026396
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-04-15.
0001213900-26-044131
Item 7. 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 77 previous paragraphs and 67 current paragraphs.
17 unchanged; 7 reworded; 43 added; 53 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 22 previous and 19 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 (43)
Current report
In December 2025, YHC Online Limited (“YHC”), a wholly-owned subsidiary of the Company, entered into four separate joint venture agreements with Bancroft Equity, Emerald Wealth Inc., Meridian Financial, and Sequoia Equity (collectively, the “Joint Ventures”). Each Joint Venture is engaged in the creation and monetization of multi-channel network (“MCN”) content for digital platforms, including TikTok, with each entity targeting a specific geographic market. YHC holds a 20% minority ownership interest in each Joint Venture, with the majority partner in each retaining full operational control. The following table summarizes the key terms of each agreement as of December 31, 2025:
Current report
Each agreement provides YHC with a put right, exercisable after the first anniversary of the respective agreement, to require the co-venturer to repurchase YHC’s interest at YHC’s total funded investment amount. As the agreements were executed in late 2025 and operations had not yet commenced as of December 31, 2025, no revenue was generated by any Joint Venture during the year ended December 31, 2025.
Current report
None of the co-venturers is a related party to the Company. In March 2026, all four agreements were terminated and all amounts previously funded, aggregating $18,494,000, were returned to YHC in full.
Current report
Comparison of Year Ended December 31, 2025 and Year Ended December 31, 2024
Current report
Revenues
Current report
Total revenues for the year ended December 31, 2025 were $1,564,823, a decrease of $936,837, or approximately 37%, compared to $2,501,660 for the year ended December 31, 2024. The decrease was primarily driven by a significant decline in product revenues, which fell from $2,383,695 in 2024 to $1,452,183 in 2025, a decrease of $931,512, or approximately 39%. The decline in product revenues reflects a strategic decision by management to reduce customer acquisition spending and marketing expenditures through the CWS Platform in order to minimize losses and focus on profitability with the existing customer base, rather than pursuing top-line growth at the expense of continued operating losses. As a result of reduced marketing spend, new customer acquisition and order volume through the CWS Platform declined during the year. Service revenues decreased by $5,325, or approximately 5%, from $117,965 in 2024 to $112,640 in 2025. The decrease was primarily attributable to a reduction in marketing service engagements and lower Vault membership subscription revenue during the period as the Company realigned its service offerings.
Current report
Total cost of revenue for the year ended December 31, 2025 was $1,395,524, a decrease of $1,419,311, or approximately 50%, compared to $2,814,835 for the year ended December 31, 2024. Cost of revenue for services decreased from $178,851 in 2024 to $47,129 in 2025, reflecting the reduction in marketing service engagements during the year. Cost of revenue for product decreased from $2,635,984 in 2024 to $1,348,395 in 2025, primarily driven by the significant decline in CWS Platform product sales volume.
Current report
The elevated cost of revenue in 2024 was primarily attributable to higher CWS Platform product sales volume, which resulted in correspondingly higher product fulfillment and procurement costs, as well as higher service delivery costs associated with a greater number of active marketing service engagements during that year. These factors combined to produce a gross loss of $(313,175) in 2024, as total cost of revenue exceeded total revenues.
Current report
As a result of the proportionate decrease in product fulfillment costs relative to revenues driven by lower sales volume in 2025, the Company achieved a gross profit of $169,299 for the year ended December 31, 2025, compared to a gross loss of $(313,175) for the year ended December 31, 2024, an improvement of $482,474.
Current report
Operating Expenses
Current report
Total operating expenses for the year ended December 31, 2025 were $11,597,954, a decrease of $6,576,190, or approximately 36%, compared to $18,174,144 for the year ended December 31, 2024.
Current report
General and administrative expenses decreased from $14,556,220 in 2024 to $10,954,346 in 2025, a decrease of $3,601,874, or approximately 25%. The primary driver of this decrease was the non-recurrence of approximately $8,021,000 in retention, bonus, and settlement agreements recorded in 2024, most of which were paid to insiders and related parties of the Company, with no comparable amounts incurred during 2025. This decrease was partially offset by Legal and professional fees, including consulting and accounting fees, increased by $4,018,951, from $2,508,728 in 2024 to $6,527,679 in 2025. This increase was driven primarily by a significant increase in legal fees from $815,482 in 2024 to $4,622,571 in 2025, an increase of $3,807,089, attributable to legal costs associated with the Company’s litigation and corporate development activities. Consulting fees remained relatively consistent at $1,470,066 in 2025 compared to $1,446,790 in 2024, while accounting fees increased modestly from $246,456 to $435,042.
Current report
Sales and marketing expenses decreased from $3,617,924 in 2024 to $643,608 in 2025, a decrease of $2,974,316, or approximately 82%. The decrease was primarily attributable to a non-recurring write-off of approximately $2,150,000 recorded in 2024 in connection with the termination of the Company’s website development agreement with X-Media, with no comparable charge incurred during 2025. The remainder of the decrease of approximately $824,000 reflects a reduction in advertising, promotional, and marketing campaign expenditures as the Company transitioned its marketing investment strategy toward the distribution and marketing arrangements entered into during 2025, as described in Note 8.
Current report
Loss from Operations
Current report
Loss from operations for the year ended December 31, 2025 was $(11,428,655), compared to $(18,487,319) for the year ended December 31, 2024, an improvement of $7,058,664, or approximately 38%. The improvement reflects the combined effect of higher gross profit and lower operating expenses during the year.
Current report
Other Income (Expense)
Current report
Total other expense for the year ended December 31, 2025 was $(14,093,963), compared to $(4,266,859) for the year ended December 31, 2024, an increase in net expense of $9,827,104. The increase was primarily attributable to a legal settlement expense of $13,000,000 recognized during the year ended December 31, 2025, with no comparable charge in 2024. This was partially offset by a lower impairment charge on investments of $1,127,500 in 2025, compared to $4,500,000 in 2024. Other income decreased from $227,467 in 2024 to $33,537 in 2025. The 2024 other income consisted primarily of dividend income and gains on the sale of marketable securities.
Current report
Net loss for the year ended December 31, 2025 was $(25,522,618), compared to $(22,754,178) for the year ended December 31, 2024, an increase in net loss of $2,768,440, or approximately 12%. The increased net loss was primarily driven by the $13,000,000 legal settlement expense recorded in 2025, partially offset by improvements in gross profit and reductions in operating expenses.
Current report
As of December 31, 2025, we had cash and cash equivalents of $5,975,408 compared to $5,386,789 as of December 31, 2024. As of December 31, 2025, we had a working capital surplus of $14,135,897 and total stockholders’ equity of $29,332,638, compared to a working capital deficit of $(1,645,461) and total stockholders’ equity deficit of $(517,961) as of December 31, 2024. The improvement in our balance sheet reflects significant equity financing activities completed during 2025.
Current report
During the year ended December 31, 2025, we used net cash of $(33,817,140) in operating activities, compared to $(6,618,417) used in operating activities during the year ended December 31, 2024, an increase of cash used by $27,198,723.
Current report
The primary driver of cash used in operating activities was the net loss of $25,522,618, which included the $13,000,000 Kingbird legal settlement paid in cash during 2025. Non-cash items partially offsetting the net loss included share based compensation of $1,932,967, impairment of investments of $1,127,500, depreciation of $28,378, bad debts of $64,530, and provision for expected credit losses of $67,948.
Current report
The most significant working capital movements were as follows:
Current report
Accounts receivable — related party increased by $150,721, reflecting higher amounts owed by Country Wine & Spirits in connection with CWS Platform product revenues, against which a provision for expected credit losses of $67,948 was recorded. The outstanding balance was subsequently offset against payables due to KBROS LLC in early 2026.
Current report
Advance payment to distributor increased by $3,279,000, reflecting amounts paid to two Hong Kong distributors — $529,000 and $2,750,000 in 2025 — for market access and distribution rights in the Asian market, recorded as advance payment to distributor. Subsequent to December 31, 2025, both arrangements were terminated and the full $3,279,000 was returned to the Company in April 2026.
Current report
Due to/from related party decreased by $2,357,737, reflecting net advances made to the Company's CEO ($50,000) and President ($2,314,450) during 2025, partially offset by amounts due to a related party credit card of $6,713. The amounts due from related parties were received back in April 2026.
Current report
Accounts payable decreased by $454,124, reflecting settlement of outstanding vendor payables during the year.
Current report
Accrued and other payables — related party decreased by $5,210,025, representing cash payments made during 2025 to settle retention, bonus, and settlement obligations that had been accrued in 2024 in connection with agreements entered into with executives, directors, and related parties. These were non-recurring cash outflows with no comparable amounts expected in future periods.
Current report
During the year ended December 31, 2024, we used net cash of $(6,618,417) in operating activities.
Current report
The primary driver was the net loss of $22,754,178. Non-cash items added back to reconcile net loss to cash used in operating activities included impairment of investments of $4,500,000 relating to the write-down of the DRNK Beverage Corp. investment, share based compensation of $2,533,256, write-off of advances to related party of $177,340, and gain on sale of marketable securities of $(5,674).
Current report
The most significant working capital movements during 2024 were as follows:
Current report
Accounts receivable — related party decreased by $22,983, reflecting collections on amounts owed by Country Wine & Spirits in connection with CWS Platform product revenues.
Current report
Prepaid expenses decreased by $1,949,226, as prepaid balances established in prior periods — primarily prepaid marketing and service costs — were amortized into expense during 2024.
Current report
Accrued and other payables — related party increased by $5,971,000, representing the accrual during the fourth quarter of 2024 of retention, bonus, and settlement obligations entered into with executives, directors, and related parties of the Company. These obligations were designed to retain key personnel and ensure continuity of leadership and governance. The cash settlement of substantially all of these obligations was deferred to 2025.
Current report
Accrued and other payables increased by $789,126, reflecting accrued professional fees, legal fees, and other vendor obligations at December 31, 2024 compared to the prior year.
Current report
Accounts payable increased by $265,414, reflecting higher outstanding vendor payables at year end.
Current report
Accounts payable — related party decreased by $37,414, reflecting payments made on outstanding related party payables during the year.
Current report
Net Cash (Used in) Provided by Investing Activities
Current report
During the year ended December 31, 2024, net cash provided by investing activities of $675,674 consisted of proceeds of $7,764,197 from the sale of marketable securities and $670,000 from the return of deposits held in escrow, partially offset by purchases of marketable securities of $7,758,523.
Current report
Net cash provided by financing activities was $53,240,300 for the year ended December 31, 2025, compared to $4,265,184 for the year ended December 31, 2024. During 2025, the Company raised significant capital through: (i) issuance of common stock pursuant to its at-the-market (“ATM”) offering program, generating proceeds of $43,199,134; (ii) issuance of common stock pursuant to registered direct offerings, generating net proceeds of $6,078,701; and (iii) exercise of warrants, generating proceeds of $4,051,415. Additionally, the Company incurred $88,950 in deferred offering costs during the year ended December 31, 2025 in connection with the registration of securities of SWOL Holdings Inc., its wholly-owned subsidiary, which are reflected as a use of cash in financing activities in the consolidated statement of cash flows.
Current report
During the year ended December 31, 2024, net cash provided by financing activities of $4,265,184 consisted of net proceeds of $1,543,079 from the sale of common stock pursuant to the at-the-market offering program and gross proceeds of $3,350,020 from the sale of securities pursuant to private placement agreements, partially offset by offering costs of $80,500 and repurchases of common stock of $547,415.
Showing the first 40 of 43 passages. Open the source sections for the rest.
Removed paragraphs (53)
Previous report
Comparison of Years Ended December 31, 2024 and 2023
Previous report
The following table sets forth key components of our results of operations during the years ended December 31, 2024 and 2023.
Previous report
Revenue
Previous report
For the years ended December 31, 2024 and 2023, service revenues were $117,965 and $474,048, respectively. Service revenues are earned as we contract with third-party alcoholic beverage brands to utilize access to the CWS Platform, as well as vault memberships. Service revenues decreased by $356,083 as more focus was emphasized on the CWS Platform.
Previous report
For the year ended December 31, 2024, product revenues were $2,383,695 compared to $646,574 in the similar 2023. The increase of $1,737,121 in revenues is due to product sales via the CWS Platform after the acquisition in November 2023.
Previous report
For the years ended December 31, 2024 and 2023, service cost of revenues was $178,851 and $351,823, respectively. Cost of revenues decreased by $172,972 in 2024 due to decrease in service revenue. In 2023, cost of revenues included amortization of the marketing license, which was impaired as of December 31, 2023.
Previous report
Product cost of revenues was $2,635,984 and $563,775 in the years ended December 31, 2024 and 2023, respectively. The increase was due to product and shipping costs associated with the product sales via the CWS Platform, which was acquired in November 2023.
Previous report
Gross profit (loss) was ($313,175) and $205,024 for the years ended December 31, 2024 and 2023. The Company has incurred gross losses in 2024 as it transitions its strategies from marketing to the CWS Platform. Management is exploring various strategies, including customer acquisition and new partnerships, to increase volume in order to achieve better gross margins in 2025.
Previous report
General and Administrative
Previous report
For the years ended December 31, 2024 and 2023, general and administrative expenses were $14,556,220 and $11,426,747, respectively. General and administrative expenses increased by $3,129,473 in 2024 as compared to 2023. In 2024, the Company recorded $2,533,256 in non-cash stock-based compensation expense pertaining to the issuance of restricted stock units as compared to $1,091,648 recorded in 2023. General and administrative expenses also increased due to personnel costs as the Company entered into several settlement, bonus and retention agreements totaling $8,021,000 in late 2024 most of which were paid to insiders and related parties of the Company.
Previous report
Bonus and retention agreements reflect strategic decisions made by the Company to retain key talent and incentivize critical personnel. These bonus and retention agreements were based on strategic decisions made by the Company to retain key talent and incentivize critical personnel. These were designed to ensure continuity in leadership and support the Company’s long-term goals, even though the Company is not currently profitable.
Previous report
Sales and Marketing
Previous report
For the years ended December 31, 2024 and 2023, sales and marketing expenses were $3,617,924 and $2,480,001, respectively. The increase of $1,137,923 was primarily due to advertising and marketing and investor relation campaigns the Company entered into in late 2023, which extended throughout 2024. Lastly, The Company determined it was no longer pursuing the website development services as per its October 2023 agreement with X-Media. As such, the full amount of the prepaid was written of during the year, representing an expense of $2,150,000. The amount was included in sales and marketing expenses in the consolidated statements of operations.
Previous report
Impairments
Previous report
For the year ended December 31, 2024, the Company recognized an impairment expense $4,500,000 related to its investment in DRNK Beverage Corp, which was included in other income (expense) in the consolidated statements of operations. The impairment was triggered by a significant decline in the fair value of the Company’s investment upon management’s review and monitoring of the investee.
Previous report
Upon the acquisition of the CWS Platform, the Company determined that the license under the CWS Agreement was no longer applicable as the Company now maintained ownership over the Platform and the relevant marketing efforts. As such, during the year ended December 31, 2023, the Company recorded an impairment of the remaining carrying value of $1,875,000.
Previous report
Net loss for the years ended December 31, 2024 and 2023 was $22,754,178 and $15,747,724, respectively.
Previous report
As of December 31, 2024 and 2023, we had cash and cash equivalents of $5,386,789 and $7,064,348, respectively. To date, we have financed our operations primarily through issuances of common stock and sales of our products and services.
Previous report
During the year ended December 31, 2024, the Company issued an aggregate of 1,518,188 shares of common stock pursuant to at-the-market offering agreement, dated September 13, 2024, between the Company and H.C. Wainwright & Co., LLC, for net proceeds of $1,599,814. The Company paid to H.C. Wainwright & Co., LLC, as the sales agent a compensation with respect to sale of such shares in the amount of $48,018. In 2025, the Company has issued 13,816,082 shares of common stock pursuant to its ATM Agreement for net proceeds of $5,014,022.
Previous report
The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has not generated profits since inception, has sustained net losses of $22,754,178 and $15,747,724 for the years ended December 31, 2024 and 2023, and has negative cash flows from operations $6,618,417 and $9,113,855 for the years ended December 31, 2024 and 2023 respectively. The Company requires additional capital to operate and expects losses to continue for the foreseeable future. These factors raise substantial doubts about the Company’s ability to continue as a going concern.
Previous report
The Company’s ability to continue as a going concern until it reaches profitability is dependent upon its ability to generate cash from operating activities and to raise additional capital to fund operations. Management is exploring various strategies, including customer acquisition and new partnerships, to increase volume in order to achieve better gross margins and profitability. The Company continues to seek investment and acquisition opportunities which will help achieve its strategies.
Previous report
The Company’s ability to continue as a going concern for the next twelve months is dependent upon its ability to generate sufficient cash flows from operations to meet its obligations, which it has not been able to accomplish to date, or to obtain additional capital to fund operations through debt and/or equity financings. Our failure to raise additional capital could have a negative impact on not only our financial condition but also our ability to execute our business plan. No assurance can be given that the Company will be successful in these efforts.
Previous report
Cash Flow Activities
Previous report
Net cash used in operating activities for the year ended December 31, 2024 was $6,618,417, primarily due to our net loss of $22,754,178, partially offset by non-cash charges of $7,204,922 and $8,930,839 in cash provided by operating assets and liabilities.
Previous report
Net cash used in operating activities for the year ended December 31, 2023 was $9,113,855, primarily due to our net loss of $15,747,724, partially offset by non-cash charges of $8,727,481 and $2,093,612 in cash used in operating assets and liabilities.
Previous report
Net cash provided by (used in) investing activities for the years ended December 31, 2024 and 2023 were 675,674 and ($5,342,574), respectively. In 2024, the Company purchased marketable securities of $7,758,523, and sold securities of $7,764,197. The Company also received $670,000 back from an investment it was no longer pursuing.
Previous report
In 2023, the Company had repayments from CWS of $137,426, and deposits in escrow of $5,470,000 and acquisition of CWS Platform of $10,000 in 2023.
Previous report
Net cash provided by financing activities for the years ended December 31, 2024 and 2023 was $4,265,184 and $21,513,212, respectively. In 2024, the Company received $3,350,020 in proceeds from private placement offerings, $1,543,079 in net proceeds pursuant to public offerings, incurred $80,500 in offering cost. The Company paid $547,415 for repurchase of shares.
Previous report
In 2023, the Company received $955,000 in proceeds from the private placement offering, $950,000 from notes, $4,507,228 in net proceeds pursuant to the IPO and $16,619,836 in net proceeds from the October and November offerings. The Company paid $1,458,852 for the repurchase of shares, and $60,000 for the cancellation of warrants.
Previous report
Contractual Obligations
Previous report
Funding Commitment Agreement
Previous report
On November 1, 2023, the Company entered into a Funding Commitment Agreement with KBROS, the Product Handler pursuant to the Product Handling Agreement as defined in Note 4. Pursuant to this agreement, the Company committed to provide annual funding to the Product Handler from time to time in the minimum amount of $2,500,000 to enable the Product Handler to purchase inventory from Company-approved vendors (“Vendors”). The Company may, without notice to Product Handler, elect not to advance funding for any inventory sold by particular Vendors with respect to which the Company reasonably feels insecure. This agreement concerns a funding commitment, and not the purchase of products from Product Handler or Vendors.
Previous report
In October, 2024, the Company entered into a settlement and release agreement with KBROS, and its controlling stockholder, for an aggregate amount equal to $4,100,000, which is included in general and administrative expenses in the consolidated statements of operations. As of December 31, 2024, $3,600,000 remained unpaid and was included as accrued expenses on the consolidated balance sheet. Of this amount, $1,800,000 was paid in 2025 and $1,800,000 remained unpaid as of issuance date of these consolidated financial statements.
Previous report
The Company no longer maintains its funding commitment pursuant to the October 2024 settlement agreement.
Previous report
Related Party Transactions
Previous report
See Note 9 to the accompanying consolidated financial statements for further disclosure.
Previous report
Critical Accounting Policies and Significant Judgements and Estimates
Previous report
This discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are 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. While our significant accounting policies are described in more detail in the notes to our financial statements included elsewhere in this report, we believe that the following accounting policies are critical to understanding our historical and future performance, as these policies relate to the more significant areas involving management’s judgments and estimates. We believe our most critical accounting policies and estimates relate to the following:
Previous report
Revenue Recognition
Previous report
In accordance with FASB ASC 606,Revenue from Contracts with Customers, the Company determines revenue recognition through the following steps:
Showing the first 40 of 53 passages. Open the source sections for the rest.
Reworded paragraphs (7)
Previous wording
Our company, LQR House Inc., intends to become the full-service digital marketing and brand development face of the alcoholic beverage space. We also intend to integrate the supply, sales, and marketing facets of the alcoholic beverage space into one easy to use platform and become the one-stop-shop for everything related to alcohol. To date, our primary business includes the development of premium limited batch spirit brands and marketing internal and external brands through our ownership of the CWS Platform. Additionally, we are in the process of establishing an exclusive wine club. We believe that the marketing and brand management services we provide to our wholly owned and third-party clients will increase brand recognition thereof, and drive sales thereof through our e-commerce platform partner.
Current wording
Our company, LQR House Inc., intends to become the full-service digital marketing and brand development face of the alcoholic beverage space. We also intend to integrate the supply, sales, and marketing facets of the alcoholic beverage space into one easy to use platform and become the one-stop-shop for everything related to alcohol. To date, our primary business includes the development of premium limited batch spirit brands and marketing internal and external brands through our ownership of the CWS Platform. Through our wholly-owned subsidiary SWOL Holdings Inc., we develop and market SWOL Tequila, a proprietary limited-edition tequila brand. We believe that the marketing and brand management services we provide to our wholly owned and third-party clients will increase brand recognition thereof, and drive sales thereof through our e-commerce platform partner.
Previous wording
In May 2024, we acquired a minority stake of common shares of Cannon Estate Winery Ltd., a British Columbia corporation, an owner of Cannon Estate Winery.
Current wording
In May 2024, we acquired a minority stake of common shares of Cannon Estate Winery Ltd., a British Columbia corporation, an owner of Cannon Estate Winery, pursuant to a Share Exchange Agreement under which the Company issued 21,429 shares of common stock (750,000 shares of its common stock on pre-reverse split basis) with a fair value of $817,500 in exchange for 113,085 common shares of Cannon. During the year ended December 31, 2025, the Company determined the investment was fully impaired and recorded an impairment charge of $817,500. The carrying value of this investment was nil as of December 31, 2025.
Previous wording
In June 2024, we acquired a minority stake of common shares of DRNK Beverage Corp., a British Columbia corporation (which became Chase Mocktails Ltd.), operating in the non-alcoholic and ready-to-drink beverage markets. As of December 31, 2024, the Company has recorded an impairment based on its evaluation of the investee. Refer to the consolidated financial statements for further disclosure.
Current wording
In June 2024, we acquired a minority stake of common shares of DRNK Beverage Corp., a British Columbia corporation (which became Chase Mocktails Ltd.), operating in the non-alcoholic and ready-to-drink beverage markets. During the year ended December 31, 2024, the Company recorded an impairment charge of $4,500,000 based on its evaluation of the investee. During the year ended December 31, 2025, the Company recorded an additional impairment charge of $300,000, fully writing down the remaining carrying value. The carrying value of this investment was nil as of December 31, 2025.
Previous wording
Cost of Revenue and Gross Profit (Loss)
Current wording
Cost of Revenue and Gross Profit
Previous wording
The following table presents selected captions from our condensed statement of cash flows for the years ended December 31, 2024 and 2023:
Current wording
The following table presents selected captions from our consolidated statement of cash flows for the years ended December 31, 2025 and 2024:
Previous wording
Net Cash Provided by (Used In) Investing Activities
Current wording
Net cash used in investing activities was $(18,834,541) for the year ended December 31, 2025, compared to net cash provided by investing activities of $675,674 for the year ended December 31, 2024. The increase in cash used in investing activities was primarily attributable to the Company's funding of an aggregate of $18,494,000 through YHC Online Limited, a wholly-owned subsidiary, in connection with four joint venture agreements entered into in December 2025, comprising $14,670,000 funded to three formed joint venture entities and $3,824,000 advanced to Sequoia Equity Group Inc. toward a planned fourth joint venture, established to cooperate in the creation and monetization of multi-channel network ("MCN") content for digital platforms, including TikTok, targeting specific geographic markets. Additional investing outflows during 2025 included purchases of property and equipment of $340,541. Subsequent to December 31, 2025, in April 2026, all four agreements were terminated and the full amount of $18,494,000 previously funded was returned to the Company.
Previous wording
We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
Current wording
We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources that are material to our investors.