TREASURE GLOBAL INC

Previous wording

On February 11, 2025, we signed a share purchase agreement to acquire a 51% stake in Tien Ming Distribution Sdn Bhd to expand FMCG fulfilment and logistics capabilities. The transaction is expected to be terminated following the lack of control or significant influence over Tien Ming Distribution Sdn Bhd and no business combination was recognized for the six months ended December 31, 2025.

Current wording

On February 11, 2025, we signed a share purchase agreement to acquire a 51% stake in Tien Ming Distribution Sdn Bhd to expand FMCG fulfilment and logistics capabilities. The transaction is expected to be terminated following the lack of control or significant influence over Tien Ming Distribution Sdn Bhd and no business combination was recognized for the nine months ended March 31, 2026.

Previous wording

We have experienced a decrease in growth rate in registered users, and a decline of active users over our last five quarters as of December 31, 2025. As of December 31, 2025, we recorded 2,709,077 registered users and 4,799 active users on the ZCITY platform. On average, our registered user base has grown by approximately 0.1% over the past five quarters, while our active user numbers have experienced an average decrease of 23.9%.

Current wording

We have experienced a decrease in growth rate in registered users, and a decline of active users over our last five quarters as of March 31, 2026. As of March 31, 2026, we recorded 2,709,613 registered users and 2,926 active users on the ZCITY platform. On average, our registered user base has grown by approximately 0.02% over the past five quarters, while our active user numbers have experienced an average decrease of 29.0%.

Previous wording

Total revenues increased by approximately $0.8 million or 148.1% to approximately $1.3 million for the six months ended December 31, 2025 from approximately $0.5 million for the six months ended December 31, 2024. The decrease was mainly attributable to increase in revenue from product and loyalty program revenue, offset by the decrease in transaction revenue and member subscription revenue.

Current wording

Total revenues increased by approximately $0.8 million, or 125.2%, to approximately $1.5 million for the three months ended March 31, 2026, from approximately $0.7 million for the same period in 2025, primarily attributable to an increase in product and loyalty program revenue, offset by a decrease in transaction revenue and the absence of customized software development service revenue for the three months ended March 31, 2026, compared to approximately $0.6 million recognized for the same period in 2025.

Previous wording

Product revenue was generated through sales of our e-voucher, health care products and other products through our ZCITY platform while loyalty program revenue was recognized when our customers redeem their previously earned reward points from our loyalty program or upon expiration of the reward point. The product and loyalty program revenue increased by approximately $0.8 million or 302.0% to approximately $1.1 million for the three months ended December 31, 2025 from approximately $0.3 million for the same period in 2024. The increase was driven primarily by higher demand for our e-voucher product, which resulted in increased sales volume.

Current wording

Product revenue was generated from sales of e-vouchers, healthcare products, and other products through our ZCITY platform, while loyalty program revenue was recognized upon redemption of previously earned reward points or upon expiration of such points. Product and loyalty program revenue increased by approximately $1.5 million, or 5,120.7%, to approximately $1.5 million for the three months ended March 31, 2026, from approximately $0.0 million for the same period in 2025. The increase was attributable to higher demand for our e-voucher products, resulting in a significant increase in sales volume.

Previous wording

Our transaction revenue decreased by 91.0%, to approximately $3,000 for the three months ended December 31, 2025, compared to approximately $28,000 for the same period in 2024. This decline was mainly due to less usage from merchants on our ZCITY platform and reduced transaction volume resulting from fewer successful referrals through our partnership with CLSB.

Current wording

Our transaction revenue decreased by 77.0% to approximately $8,000 for the three months ended March 31, 2026, compared to approximately $35,000 for the same period in 2025. The decline attributable to lower usage by merchants on our ZCITY platform and reduced transaction volume resulting from fewer successful referrals through our partnership with CLSB..

Previous wording

Cost of revenue primarily consists of purchases of gift cards or “E-voucher” PIN codes, and healthcare products, which are directly attributable to our product revenue. Total cost of revenue increased by approximately $1.0 million, or 1,285.7%, for the three months ended December 31, 2025 compared to the same period in 2024. The increase was mainly due to increase of product and loyalty program revenue and higher product cost.

Current wording

Cost of revenue primarily consists of purchases of gift cards or “E-voucher” PIN codes, and healthcare products, which are directly attributable to our product revenue. Total cost of revenue increased by approximately $1.5 million, or 729.2%, for the three months ended March 31, 2026 compared to the same period in 2025. The increase was mainly due to increase of product and loyalty program revenue and higher product cost.

Previous wording

Selling expenses amounted to approximately $46,000 and $0.1 million for the six months ended December 31, 2025 and 2024, respectively, representing a decrease of approximately $72,000 or 61.2%. The decrease was mainly attributable to decrease in marketing and promotion expense related to promoting our ZCITY platform. Marketing and promotion expense consists of redemptions of reward points which is generated from non-spending related activities (registration as a new user, referral of a new user and Spin & Win eligibility to receive reward points) in exchange for discounted credit of purchasing our products upon conversion of using the reward points. For the six months ended December 31, 2025 and 2024, we incurred approximately $1,300 and $30,000, respectively, in marketing and promotion expense, and recognized the same amount of product revenue at the time of redemption of the non-spending related activities reward points by our customers. The decrease in marketing and promotion expenses was primarily driven by our strategic goal to optimize the promotional activities, enhance our cost effectiveness, and increase profitability in our operations.

Current wording

Selling expenses amounted to approximately $51,000 and $8,000 for the three months ended March 31, 2026 and 2025, respectively, representing a increase of approximately $42,000 or 536.2%. The increase was mainly attributable to increase of marketing and promotion expense related to promoting our ZCITY platform. Marketing and promotion expense consists of redemptions of reward points which is generated from non-spending related activities (registration as a new user, referral of a new user and Spin & Win eligibility to receive reward points) in exchange for discounted credit of purchasing our products upon conversion of using the reward points. For the three months ended March 31, 2026 and 2025, we incurred approximately $13,000 and $3,000, respectively, in marketing and promotion expense, and recognized the same amount of product revenue at the time of redemption of the non-spending related activities reward points by our customers.

Previous wording

Stock-based compensation expenses amounted to approximately $0.8 million and $70,000 for the three months ended December 31, 2025, and 2024, respectively. The stock-based compensation incurred for the three months ended December 31, 2025 and 2024, was related to compensation paid to our executive officers and other employees as part of their compensation plan and third party for professional service.

Current wording

Stock-based compensation expenses amounted to approximately $0.3 million and $70,000 for the three months ended March 31, 2026, and 2025, respectively. The stock-based compensation incurred for the three months ended March 31, 2026 and 2025, was related to compensation paid to our executive officers and other employees as part of their compensation plan and third party for professional service.

Previous wording

Other income, net, amounted to approximately $4.6 and $0.5 million for the three months ended December 31, 2025 and 2024, respectively. This change was primarily attributable to (i) an increase in gain from the change in fair value of derivative liabilities of approximately $4.6 million from issuance of warrant in connection with the Share Purchase Agreement, offset by (ii) a decrease in unrealized gain of approximately $0.5 million on marketable securities as the marketable securities were disposed during the year ended June 30, 2025.

Current wording

Other income, net, amounted to approximately $1.9 and $1.3 million for the three months ended March 31, 2026 and 2025, respectively. This change was primarily attributable to (i) a decrease in unrealized loss of approximately $0.5 million on marketable securities as the marketable securities were disposed during the year ended June 30, 2025, and (ii) an increase of gain from disposal of subsidiaries of approximately $1.0 million, offset by (a) an decrease in gain from the change in fair value of derivative liabilities of approximately $0.6 million from issuance of warrant in connection with the Share Purchase Agreement, and (b) approximately $0.3 million loss from disposal of equipment.

Previous wording

Provision for income taxes amounted to approximately $100,000 and $9,000 for the three months ended December 31, 2025 and 2024. The amount was mainly attributable to tax imposed on us from the State of Delaware, as we are required to remit franchise tax to the State of Delaware on an annual basis. We also were subject to controlled foreign corporations Subpart F income (“Subpart F”) tax, which is a tax primarily on passive income from controlled foreign corporations with a tax rate of 35%. In addition, the Tax Cuts and Jobs Act imposed a global intangible low-taxed income (“GILTI”) tax, which is a tax on certain off-shore earnings at an effective rate of 10.5% for tax years (50% deduction of the current enacted tax rate of 21%) with a partial offset for 80% foreign tax credits. If the foreign tax rate is 13.125% or higher, there will be no U.S. corporate tax after the 80% foreign tax credits are applied. For the three months ended December 31, 2025 and 2024, our foreign subsidiaries did not generate any income that are subject to Subpart F tax and GILTI tax.

Current wording

Provision for income taxes amounted to approximately $50,000 and $0 for the three months ended March 31, 2026 and 2025. The amount was mainly attributable to tax imposed on us from the State of Delaware, as we are required to remit franchise tax to the State of Delaware on an annual basis. We also were subject to controlled foreign corporations Subpart F income (“Subpart F”) tax, which is a tax primarily on passive income from controlled foreign corporations with a tax rate of 35%. In addition, the Tax Cuts and Jobs Act imposed a global intangible low-taxed income (“GILTI”) tax, which is a tax on certain off-shore earnings at an effective rate of 10.5% for tax years (50% deduction of the current enacted tax rate of 21%) with a partial offset for 80% foreign tax credits. If the foreign tax rate is 13.125% or higher, there will be no U.S. corporate tax after the 80% foreign tax credits are applied. For the three months ended March 31, 2026 and 2025, our foreign subsidiaries did not generate any income that are subject to Subpart F tax and GILTI tax.

Previous wording

We generated net loss of approximately $3.1 million and $0.2 million for the three months ended December 31, 2025 and 2024, respectively, representing a change of approximately $2.9 million. The change was primarily attributable to the factors discussed above.

Current wording

We generated net loss of approximately $2.3 million for the three months ended March 31, 2026 and net income of approximately $1.3 million for the three months ended March 31, 2025, representing a change of approximately $3.4 million. The change was primarily attributable to the factors discussed above.

Previous wording

Our breakdown of revenues by categories for the six months ended December 31, 2025 and 2024, respectively, is summarized below:

Current wording

Our breakdown of revenues by categories for the nine months ended March 31, 2026 and 2025, respectively, is summarized below:

Previous wording

Total revenues increased by approximately $0.8 million or 258.1% to approximately $1.1 million for the three months ended December 31, 2025 from approximately $0.3 million for the three months ended December 31, 2024. The increase was mainly attributable to increase in revenue from product and loyalty program revenue, offset by decrease in transaction revenue and member subscription revenue offset by.

Current wording

Total revenues increased by approximately $1.6 million, or 135.1%, to approximately $2.8 million for the nine months ended March 31, 2026, from approximately $1.2 million for the same period in 2025. The increase was attributable to a increase in product and loyalty program revenue, offset by decreases in transaction revenue, member subscription revenue, and customized software development service revenue.

Previous wording

Product revenue was generated through sales of our e-voucher, health care products and other products through our ZCITY platform while loyalty program revenue was recognized when our customers redeem their previously earned reward points from our loyalty program or upon expiration of the reward point. The product and loyalty program revenue increased by approximately $0.9 million or 260.0% to approximately $1.3 million for the six months ended December 31, 2025 from approximately $0.4 million for the same period in 2024. The increase was driven primarily by higher demand for our e-voucher product, which resulted in increased sales volume.

Current wording

Product revenue was generated from sales of e-vouchers, healthcare products, and other products through our ZCITY platform, while loyalty program revenue was recognized upon redemption of previously earned reward points or upon expiration of such points. Product and loyalty program revenue increased by approximately $2.4 million, or 627.1%, to approximately $2.8 million for the nine months ended March 31, 2026, from approximately $0.4 million for the same period in 2025. The increase was primarily attributable to higher demand for our e-voucher products, resulting in increase in sales volume.

Previous wording

Our transaction revenue decreased by 95.0%, to approximately $4,000 for the six months ended December 31, 2025, compared to approximately $72,000 for the same period in 2024. This decline was mainly due to less usage from merchants on our ZCITY platform and reduced transaction volume resulting from fewer successful referrals through our partnership with CLSB.

Current wording

Transaction revenue decreased by approximately $0.1 million, or 89.1%, to approximately $12,000 for the nine months ended March 31, 2026, compared to approximately $0.1 million for the same period in 2025. The decrease was attributable to lower usage by merchants on our ZCITY platform and reduced transaction volume resulting from fewer successful referrals through our partnership with CLSB.

Previous wording

Member subscription revenue primarily consists of fees charged to customers who sign up for Zmember, our membership program that offers exclusive savings, bonuses, and referral rewards. For the three months ended December 31, 2025, member subscription revenue decreased by 100.0% to $0, from approximately $5,000 for the same period in 2024. The decrease was primarily due to we experienced slowdown in acquiring new customers to participate in our Zmember program. As of December 31, 2025 and June 30, 2025, we had 27,620 customers who subscribed to our Zmember program.

Current wording

Member subscription revenue primarily consists of fees charged to customers who subscribe to Zmember, our membership program offering exclusive savings, bonuses, and referral rewards. For the nine months ended March 31, 2026, member subscription revenue decreased to $0, from approximately $0.1 million for the same period in 2025. The decrease was primarily due to a slowdown in acquiring new customers participating in the Zmember program. As of March 31, 2026 and June 30, 2025, we had 27,620 customers subscribed to our Zmember program.

Previous wording

Our breakdown of cost of revenue by categories for the six months ended December 31, 2025, and 2024, respectively, is summarized below:

Current wording

Our breakdown of cost of revenue by categories for the nine months ended March 31, 2026, and 2025, respectively, is summarized below:

Previous wording

Cost of revenue primarily consists of purchases of gift cards or “E-voucher” PIN codes, and healthcare products, which are directly attributable to our product revenue. Total cost of revenue increased by approximately $1.1 million, or 1,014.8%, for the six months ended December 31, 2025 compared to the same period in 2024. The increase was mainly due to increase of product and loyalty program revenue and higher product cost.

Current wording

Cost of revenue primarily consists of purchases of gift cards or “e-voucher” PIN codes and healthcare products, which are directly attributable to our product revenue. Total cost of revenue increased by approximately $2.5 million, or 839.3%, to approximately $2.8 million for the nine months ended March 31, 2026, from approximately $0.3 million for the same period in 2025. The increase was primarily attributable to increase in product and loyalty program revenue, as well as higher product cost.

Previous wording

Selling expenses amounted to approximately $25,000 and $40,000 for the three months ended December 31, 2025 and 2024, respectively, representing a decrease of approximately $15,000 or 37.8%. The decrease was mainly attributable to decrease of marketing and promotion expense related to promoting our ZCITY platform. Marketing and promotion expense consists of redemptions of reward points which is generated from non-spending related activities (registration as a new user, referral of a new user and Spin & Win eligibility to receive reward points) in exchange for discounted credit of purchasing our products upon conversion of using the reward points. For the three months ended December 31, 2025 and 2024, we incurred approximately $328 and $9,000, respectively, in marketing and promotion expense, and recognized the same amount of product revenue at the time of redemption of the non-spending related activities reward points by our customers. The decrease in marketing and promotion expenses was primarily driven by our strategic goal to optimize the promotional activities, enhance our cost effectiveness, and increase profitability in our operations.

Current wording

Selling expenses amounted to approximately $96,000 and $125,000 for the nine months ended March 31, 2026 and 2025, respectively, representing a decrease of approximately $29,000 or 23.3%. The decrease was mainly attributable to decrease in marketing and promotion expense related to promoting our ZCITY platform. Marketing and promotion expense consists of redemptions of reward points which is generated from non-spending related activities (registration as a new user, referral of a new user and Spin & Win eligibility to receive reward points) in exchange for discounted credit of purchasing our products upon conversion of using the reward points. For the nine months ended March 31, 2026 and 2025, we incurred approximately $15,000 and $33,000, respectively, in marketing and promotion expense, and recognized the same amount of product revenue at the time of redemption of the non-spending related activities reward points by our customers. The decrease in marketing and promotion expenses was primarily driven by our strategic goal to optimize the promotional activities, enhance our cost effectiveness, and increase profitability in our operations.

Previous wording

General and administrative expenses amounted to approximately $4.6 million and $1.6 million for the six months ended December 31, 2025 and 2024, respectively, representing a increase of approximately $3.1 million or 196.3%. The increase was driven primarily by higher costs associated with administrative functions, including incremental staffing and increased professional service fees to support our operations. The increase is also attributable to increase of approximately $0.3 million of impairment loss from our intangible assets.

Current wording

General and administrative expenses amounted to approximately $8.4 million and $2.0 million for the nine months ended March 31, 2026 and 2025, respectively, representing an increase of approximately $6.3 million or 313.1%. The increase was driven primarily by increased costs associated with administrative expense of approximately $3.3 million, including salary expense and professional service fees to support our operations. The increase is also attributable to an approximately $3.3 million increase in allowance for credit losses mainly related to an increase in estimated credit losses against certain other receivables.

Previous wording

Research and development expense amounted to approximately $0.8 million and $80,000 for the six months ended December 31, 2025 and 2024, respectively, representing 899.0% increase as we incurred more spending in A.I related infrastructure development. The increase primarily reflects costs for software engineering, cloud infrastructure and GPU-related development supporting the live-streaming/AI program described in “Business Development.”

Current wording

Research and development expense amounted to approximately $0.9 million and $86,000 for the nine months ended March 31, 2026 and 2025, respectively, representing 928.8% increase as we incurred more spending in A.I related infrastructure development. The increase primarily reflects costs for software engineering, cloud infrastructure and GPU-related development supporting the live-streaming/AI program described in “Business Development.”

Previous wording

Stock-based compensation expenses amounted to approximately $0.9 million and $0.1 million for the six months ended December 31, 2025, and 2024, respectively. The stock-based compensation incurred for the six months ended December 31, 2025 and 2024, was related to compensation paid to our executive officers and employees as part of their compensation plan and third party for professional service.

Current wording

Stock-based compensation expenses amounted to approximately $1.1 million and $0.2 million for the nine months ended March 31, 2026, and 2025, respectively. The stock-based compensation incurred for the nine months ended March 31, 2026 and 2025, was related to compensation paid to our executive officers and employees as part of their compensation plan and third party for professional service.

Previous wording

Other income, net, amounted to approximately $4.3 and 0.3 million for the six months ended December 31, 2025 and 2024, respectively. This change was primarily attributable to (i) an increase in gain from the change in fair value of derivative liabilities of approximately $4.2 million from issuance of warrant in connection with the Share Purchase Agreement, offset by (ii) a decrease in unrealized income of approximately $0.3 million on marketable securities as the marketable securities were disposed during the year ended June 30, 2025.

Current wording

Other income, net, amounted to approximately $6.2 and 1.6 million for the nine months ended March 31, 2026 and 2025, respectively. This change was primarily attributable to (i) an increase in gain from the change in fair value of derivative liabilities of approximately $3.6 million from issuance of warrant in connection with the Share Purchase Agreement, (ii) an increase of gain from disposal of subsidiaries of approximately $1.0 million, and (iii) decrease in unrealized loss of approximately $0.2 million on marketable securities as the marketable securities were disposed during the year ended June 30, 2025, offset by approximately $0.3 million loss from disposal of equipment.

Previous wording

Provision for income taxes amounted to approximately $100,000 and $21,000 for the six months ended December 31, 2025 and 2024. The amount was mainly attributable to tax imposed on us from the State of Delaware, as we are required to remit franchise tax to the State of Delaware on an annual basis. We also were subject to controlled foreign corporations Subpart F income (“Subpart F”) tax, which is a tax primarily on passive income from controlled foreign corporations with a tax rate of 35%. In addition, the Tax Cuts and Jobs Act imposed a global intangible low-taxed income (“GILTI”) tax, which is a tax on certain off-shore earnings at an effective rate of 10.5% for tax years (50% deduction of the current enacted tax rate of 21%) with a partial offset for 80% foreign tax credits. If the foreign tax rate is 13.125% or higher, there will be no U.S. corporate tax after the 80% foreign tax credits are applied. For the six months ended December 31, 2025 and 2024, our foreign subsidiaries did not generate any income that are subject to Subpart F tax and GILTI tax.

Current wording

Provision for income taxes amounted to approximately $150,000 and $21,000 for the nine months ended March 31, 2026 and 2025. The amount was mainly attributable to tax imposed on us from the State of Delaware, as we are required to remit franchise tax to the State of Delaware on an annual basis. We also were subject to controlled foreign corporations Subpart F income (“Subpart F”) tax, which is a tax primarily on passive income from controlled foreign corporations with a tax rate of 35%. In addition, the Tax Cuts and Jobs Act imposed a global intangible low-taxed income (“GILTI”) tax, which is a tax on certain off-shore earnings at an effective rate of 10.5% for tax years (50% deduction of the current enacted tax rate of 21%) with a partial offset for 80% foreign tax credits. If the foreign tax rate is 13.125% or higher, there will be no U.S. corporate tax after the 80% foreign tax credits are applied. For the nine months ended March 31, 2026 and 2025, our foreign subsidiaries did not generate any income that are subject to Subpart F tax and GILTI tax.

Previous wording

We generated net loss of approximately $5.2 million and $1.2 million for the six months ended December 31, 2025 and 2024, respectively, representing a change of approximately $4.1 million. The change was primarily attributable to the factors discussed above.

Current wording

We generated net loss of approximately $7.6 million for the nine months ended March 31, 2026 and net income of approximately $77,000 for the nine months ended March 31, 2025, representing a change of approximately $7.6 million. The change was primarily attributable to the factors discussed above.

Previous wording

As of December 31, 2025 and June 30, 2025, we had approximately $5.5 million and 0.2 million, respectively, in cash and cash equivalent which primarily consists of bank deposits, which are unrestricted as to withdrawal and use.

Current wording

As of March 31, 2026 and June 30, 2025, we had approximately $2.9 million and 0.2 million, respectively, in cash and cash equivalent which primarily consists of bank deposits, which are unrestricted as to withdrawal and use.

Previous wording

The following summarizes the key components of our cash flows for the six months ended December 31, 2025 and 2024:

Current wording

The following summarizes the key components of our cash flows for the nine months ended March 31, 2026 and 2025:

Previous wording

Net cash used in operating activities for the six months ended December 31, 2025 was approximately $4.7 million and was mainly comprised of (i) the net loss of approximately $5.2 million, (ii) non-cash items of change in fair value of derivative liabilities amounted to approximately $4.2 million, (iii) increase of other receivable and other assets of approximately $1.4 million which due to prepayment to certain developers for the development of our internal AI software, (v) decrease of approximately $88,000 in other payables and accrued liabilities reflecting the timely settlement of certain accrued expenses, and (vi) increase of inventories of approximately $0.1 million as we increase our purchase and intended to maintain a more effective inventory level, offset by (i) non-cash items of depreciation, amortization, loss from disposal of equipment, stock-based compensation, long-live assets impairment and allowance for credits losses amounted to approximately $6.1 million, (ii) decrease in accounts receivable of approximately $0.1 million due to timely collection, an (iii) increase in income tax payable due to additional tax accrued.

Current wording

Net cash used in operating activities for the nine months ended March 31, 2026 was approximately $5.2 million and was mainly comprised of (i) the net loss of approximately $4.7 million, (ii) non-cash items of change in fair value of derivative liabilities, gain from disposal of subsidiaries, and interest income on crypto assets receivable amounted to approximately $6.4 million, and (iii) increase of other receivables and other assets of approximately $0.9 million which was primarily due to prepayments to certain developers for the development of our internal AI software, offset by (i) non-cash items of depreciation, amortization, allowance for credit losses, loss from disposal of equipment, and stock-based compensation amounted to approximately $8.1 million, (ii) decrease in accounts receivable of approximately $0.3 million due to timely collection, and (iii) increase in other payables and accrued liabilities of approximately $1.3 million reflecting higher accrued expenses during the period.

Previous wording

Net cash used in operating activities for the six months ended December 31, 2024 was approximately $1.6 million and was mainly comprised of (i) the net loss of approximately $1.2 million, (ii) non-cash item of unrealized holding gain on marketable securities of approximately $0.3 million, (iii) increase of other receivable and other assets of approximately $0.5 million which includes approximately $0.5 million prepayment to certain developers for the development of our internal AI software, (iv) increase in accounts receivable of approximately $0.3 million due to higher sales made on account but not yet collected, (v) decrease in customer deposits of approximately $71,000, as we recognized member service revenue in the current period from certain merchant prepayments made in the prior period, and (vi) decrease of other payable and accrued liabilities of approximately $0.1 million as we pay off some of the accrued operating expenses, offset by (i) non-cash items of depreciation, amortization, allowance for credit losses, stock-based compensation and unrealized loss on marketable securities amounted to approximately $0.8 million, and (ii) decrease of prepayment of approximately $85,000 due to the utilization of prior-period prepayments for inventory purchases.

Current wording

Net cash used in operating activities for the nine months ended March 31, 2025 was approximately $5.8 million and was mainly comprised of (i) non-cash item of gain in change in fair value of derivative liabilities of approximately $1.7 million, (ii) increase in accounts receivable of approximately $0.3 million due to higher sales made on account but not yet collected, (iii) increase of other receivable and other assets of approximately $4.4 million which mainly includes prepayment to certain developers for the development of our internal AI software, (iv) decrease in customer deposits of approximately $75,000, as we recognized member service revenue in the current period from certain merchant prepayments made in the prior period, and (v) decrease of other payable and accrued liabilities of approximately $0.1 million as we pay off some of the accrued operating expenses, offset by (i) the net income of approximately $0.1 million, (ii) non-cash items of depreciation, amortization, allowance for credit losses, stock-based compensation and unrealized loss on marketable securities amounted to approximately $0.2 million, (ii) decrease of prepayment of approximately $76,000 due to the utilization of prior-period prepayments for inventory purchases, and (iii) increase of approximately $0.1 million in accounts payable as we made more purchases on account.

Previous wording

Net cash used in investing activities for the six months ended December 31, 2025 was approximately $1.0 million which mainly due to approximately $1.0 million in purchase of property and equipment, approximately $7,000 prepayment of purchase consideration for acquisition of Tien Ming Distribution Sdn Bhd, and the remittance of approximately $53,000 to CLSB as a collaboration deposit to support CLSB’s credit service activities for the Portfolio Clients.

Current wording

Net cash used in investing activities for the nine months ended March 31, 2026 was approximately $2.9 million which mainly due to approximately $1.0 million in purchase of property and equipment, approximately $0.3 million in purchase of crypto assets receivable, approximately $1.5 million of prepayment of purchase consideration for acquisition of Tazte Technologies and Tien Ming Distribution Sdn Bhd, and the remittance of approximately $53,000 to CLSB as a collaboration deposit to support CLSB’s credit service activities for the Portfolio Clients.

Previous wording

Net cash used in investing activities for the six months ended December 31, 2024 was approximately $2.2 million which includes a remittance of approximately $2.2 million to CLSB as a collaboration deposit to support CLSB’s credit service activities for the Portfolio Clients

Current wording

Net cash used in investing activities for the nine months ended March 31, 2025 was approximately $4.3 million which includes a remittance of approximately $4.3 million to CLSB as a collaboration deposit to support CLSB’s credit service activities for the Portfolio Clients.

Previous wording

Net cash provided financing activities the six months ended December 31, 2025 was approximately 11.0 million, which mainly comprised of approximately $7.1 million net proceeds received from Share Purchase Agreement, approximately $1.4 million net proceeds received from exercise of warrants into common stock, approximately 2.5 million net proceeds received from direct offering, and approximately $0.4 million net proceeds received from private placement, offset by payments of insurance loan and related party loan of approximately $40,000 and payment of offering cost of approximately $0.3 million.

Current wording

Net cash provided financing activities the nine months ended March 31, 2026 was approximately 11.0 million, which mainly comprised of approximately $7.1 million net proceeds received from Share Purchase Agreement, approximately $1.4 million net proceeds received from exercise of warrants into common stock, approximately 2.5 million net proceeds received from direct offering, approximately $0.4 million net proceeds received from private placement, and approximately $73,000 proceed received from insurance loan, offset by payments of insurance loan and related party loan of approximately $63,000 and payment of offering cost of approximately $0.3 million.

Previous wording

Net cash provided financing activities the six months ended December 31, 2024 was approximately $3.9 million, which mainly comprised of approximately $4.0 million net proceeds received from issuance of common stock through market offering and share purchase agreement, offset by payments of insurance loan and related party loan of approximately $41,000.

Current wording

Net cash provided financing activities the nine months ended March 31, 2025 was approximately $10.4 million, which mainly comprised of approximately $10.3 million net proceeds received from issuance of common stock through market offering, subscription agreement, and share purchase agreement, and loan proceed of approximately $51,000, offset by payments of insurance loan and related party loan of approximately $42,000.

Previous wording

Accounts receivable are recorded at the invoiced amount, net of an allowance for uncollectible accounts and do not accrue interest. We offer various payments terms to customers from cash due on delivery to 90 days based on their credit history. Accounts receivable encompass amounts due from sales of healthcare products on our ZCITY platform. Management also periodically evaluates individual customer’s financial condition, credit history and the current economic conditions to make adjustments in the allowance when it is considered necessary. Account balances are charged off against the allowance when all collection efforts have been exhausted, and recovery potential is deemed remote. Our management reviews historical accounts receivable collection rates across all aging brackets and has made 100% provision of credit loss for customer balances aged above 120 days for sales of healthcare products on our ZCITY platform. Our management continuously assesses the reasonableness of the credit loss allowance policy and updates it as needed. As of December 31, 2025 and June 30, 2025, we recorded $705,089 and $9,924 of provision for estimated credit losses, respectively.

Current wording

Accounts receivable are recorded at the invoiced amount, net of an allowance for uncollectible accounts and do not accrue interest. We offer various payments terms to customers from cash due on delivery to 90 days based on their credit history. Accounts receivable encompass amounts due from sales of healthcare products on our ZCITY platform. Management also periodically evaluates individual customer’s financial condition, credit history and the current economic conditions to make adjustments in the allowance when it is considered necessary. Account balances are charged off against the allowance when all collection efforts have been exhausted, and recovery potential is deemed remote. Our management reviews historical accounts receivable collection rates across all aging brackets and has made 100% provision of credit loss for customer balances aged above 120 days for sales of healthcare products on our ZCITY platform. Our management continuously assesses the reasonableness of the credit loss allowance policy and updates it as needed. As of March 31, 2026 and June 30, 2025, we recorded $735,309 and $9,924 of provision for estimated credit losses, respectively.

Previous wording

Our inventories are recorded at the lower of cost or net realizable value, with cost determined using the first-in-first-out (FIFO) method. These costs encompass gift cards or ‘E-voucher’ pin codes, which are acquired from our suppliers as merchandise goods or store credit, as well as healthcare products. Management conducts regular comparisons between the cost of inventories and their net realizable value. If the net realizable value is lower than the cost, an allowance is made for inventory write-down. Ongoing assessments of inventories are carried out to identify potential write-downs due to estimated obsolescence or unmarketability. This determination is based on the difference between the inventory costs and the estimated net realizable value, considering forecasts for future demand and market conditions. Once inventories are written down to the lower of cost or net realizable value, they are not subsequently marked up based on changes in underlying facts and circumstances. Our management has reviewed the aforementioned factors and has applied a 100% write-down for inventories aged above 180 days related to our E-voucher and health care products. For the three and six months ended December 31, 2025 and 2024, no write-downs for estimated obsolescence or unmarketable inventories were recorded.

Current wording

Our inventories are recorded at the lower of cost or net realizable value, with cost determined using the first-in-first-out (FIFO) method. These costs encompass gift cards or ‘E-voucher’ pin codes, which are acquired from our suppliers as merchandise goods or store credit, as well as healthcare products. Management conducts regular comparisons between the cost of inventories and their net realizable value. If the net realizable value is lower than the cost, an allowance is made for inventory write-down. Ongoing assessments of inventories are carried out to identify potential write-downs due to estimated obsolescence or unmarketability. This determination is based on the difference between the inventory costs and the estimated net realizable value, considering forecasts for future demand and market conditions. Once inventories are written down to the lower of cost or net realizable value, they are not subsequently marked up based on changes in underlying facts and circumstances. Our management has reviewed the aforementioned factors and has applied a 100% write-down for inventories aged above 180 days related to our E-voucher and health care products. For the three and nine months ended March 31, 2026 and 2025, no write-downs for estimated obsolescence or unmarketable inventories were recorded.

Previous wording

Other receivables and other current assets consist of prepayment to third parties for cyber security service, director & officer liability insurance (“D&O Insurance”), and other professional fee. Other receivables and other current assets also include refundable advance to third party service provider, and other deposits. Starting from July 1, 2023, we had adopted ASC Topic 326 on our other receivables using the modified retrospective approach. The new credit loss guidance replaces the old model for measuring the allowance for credit losses with a model that is based on the expected losses rather than incurred losses. Under the new accounting guidance, we measure credit losses on its other receivables using the current expected credit loss model under ASC 326. As of December 31, 2025 and June 30, 2025, we have provided allowance for credit loss of $2,423,937 and $1,078,353, respectively.

Current wording

Other receivables and other current assets consist of prepayment to third parties for cyber security service, director & officer liability insurance (“D&O Insurance”), and other professional fee. Other receivables and other current assets also include refundable advance to third party service provider, and other deposits. Starting from July 1, 2023, we had adopted ASC Topic 326 on our other receivables using the modified retrospective approach. The new credit loss guidance replaces the old model for measuring the allowance for credit losses with a model that is based on the expected losses rather than incurred losses. Under the new accounting guidance, we measure credit losses on its other receivables using the current expected credit loss model under ASC 326. As of March 31, 2026 and June 30, 2025, we have provided allowance for credit loss of $3,798,438 and $1,078,353, respectively.

Previous wording

Investments in marketable securities, net, consist of investments in listed shares, which are listed on Nasdaq. Marketable securities are accounted for under ASC 321 and reported at their readily determinable fair values as quoted by market exchanges with changes in fair value recorded in other (expense) income in the consolidated statements of operations and comprehensive loss. All changes in a marketable security’s fair value are reported in earnings as they occur, as such, the sale of a marketable security does not necessarily give rise to a significant gain or loss. Unrealized gains/(losses) due to fluctuations in fair value are recorded in the consolidated statements of operations and comprehensive loss. Declines in fair value below cost deemed to be other-than-temporary are recognized as impairments in the consolidated statements of comprehensive income. For the three and six months ended December 31, 2025, we recorded an unrealized holding loss on marketable securities of $0. For the three and six months ended December 31, 2024, we recorded an unrealized holding gain on marketable securities of approximately $0.5 million and $0.3 million, respectively.

Current wording

Investments in marketable securities, net, consist of investments in listed shares, which are listed on Nasdaq. Marketable securities are accounted for under ASC 321 and reported at their readily determinable fair values as quoted by market exchanges with changes in fair value recorded in other (expense) income in the consolidated statements of operations and comprehensive loss. All changes in a marketable security’s fair value are reported in earnings as they occur, as such, the sale of a marketable security does not necessarily give rise to a significant gain or loss. Unrealized gains/(losses) due to fluctuations in fair value are recorded in the consolidated statements of operations and comprehensive loss. Declines in fair value below cost deemed to be other-than-temporary are recognized as impairments in the consolidated statements of comprehensive income. For the three and nine months ended March 31, 2026, we recorded an unrealized holding loss on marketable securities of $0. For the three and nine months ended March 31, 2025, we recorded an unrealized holding gain on marketable securities of approximately $0.5 million and $0.2 million, respectively.

Previous wording

We account for stock-based compensation awards to officers in accordance with FASB ASC Topic 718, “Compensation – Stock Compensation”, which requires that stock-based payment transactions with employees be measured based on the grant-date fair value of the equity instrument issued and recognized as compensation expense over the requisite service period. In June 2024, we executed executive employment agreements (“Employment Agreements”) with three individuals, appointing them as the Company’s executive officers. Under the terms of the Employment Agreements, each executive officer is entitled to receive a predetermined monetary value of the Company’s common stock as annual compensation for the first year, with stock compensation for subsequent years contingent upon performance. The stock compensation is prorated on a monthly basis and is subject to the restrictions of Securities Act Rule 144. The fair value of the stock-based compensation which included common stock issued were equivalent to the predetermined monetary value. For the six months ended December 31, 2025 and 2024, we have incurred stock-based compensation from our officer and third party service provider amounted to approximately $0.5 million and $0.1 million, respectively.

Current wording

We account for stock-based compensation awards to officers in accordance with FASB ASC Topic 718, “Compensation – Stock Compensation”, which requires that stock-based payment transactions with employees be measured based on the grant-date fair value of the equity instrument issued and recognized as compensation expense over the requisite service period. In June 2024, we executed executive employment agreements (“Employment Agreements”) with three individuals, appointing them as the Company’s executive officers. Under the terms of the Employment Agreements, each executive officer is entitled to receive a predetermined monetary value of the Company’s common stock as annual compensation for the first year, with stock compensation for subsequent years contingent upon performance. The stock compensation is prorated on a monthly basis and is subject to the restrictions of Securities Act Rule 144. The fair value of the stock-based compensation which included common stock issued were equivalent to the predetermined monetary value. For the three months ended March 31, 2026 and 2025, we have incurred stock-based compensation from our officer and third party service provider amounted to approximately $0.3 million and $70,000, respectively. For the nine months ended March 31, 2026 and 2025, we have incurred stock-based compensation from our officer and third party service provider amounted to approximately $1.1 million and $0.2 million, respectively.

Previous wording

The fair value of the warrants issued to Alumni Capital which was determined on December 31, 2025 by using the Black Scholes model using the following assumptions: (1) expected volatility of 182.3%, (2) risk-free interest rate of 3.47%, (3) expected life of 1.8 years, (4) exercise price of $5.10 and (5) stock price of $6.13 on December 31, 2025. Based on above assumption, the fair value of the warrants was estimated to be $2,349,273.

Current wording

The fair value of the warrants issued to Alumni Capital which was determined on March 31, 2026 by using the Black Scholes model using the following assumptions: (1) expected volatility of 177.6%, (2) risk-free interest rate of 3.74%, (3) expected life of 1.5 years, (4) exercise price of $5.07 and (5) stock price of $3.56 on March 31, 2026. Based on above assumption, the fair value of the warrants was estimated to be $1,165,795.