All In FutureTech Alliance, Inc.

Previous wording

The following discussion and analysis of the results of operations and financial condition of ALL IN FUTURETECH ALLIANCE, INC. (the “Company”) as of March 31,2026 and for the three months ended March 31, 2026 and 2025 should be read in conjunction with our financial statements and the notes to those financial statements that are included elsewhere in this Quarterly Report on Form 10-Q. This discussion and analysis should be read in conjunction with the Company’s audited financial statements and related disclosures as of December 31, 2025, which are included in the Form 10-K (the “Annual Report”) filed with the Securities and Exchange Commission (“SEC”) on May 22, 2026. References in this Management’s Discussion and Analysis of Financial Condition and Results of Operations to “us”, “we”, “our” and similar terms refer to the Company and its subsidiaries. This Management’s Discussion and Analysis of Financial Condition and Results of Operations contains statements that are forward-looking. These statements are based on current expectations and assumptions that are subject to risk, uncertainties and other factors. These statements are often identified by the use of words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intend,” “could,” “estimate,” or “continue,” and similar expressions or variations. Actual results could differ materially because of the factors discussed in “Risk Factors” in our Annual Report, and other factors that we may not know. Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements, all of which are expressly qualified by the statements above, to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q.

Current wording

The following discussion and analysis of the results of operations and financial condition of ALL IN FUTURETECH ALLIANCE, INC. (the “Company”) as of June 30,2026 and for the three and six months ended June 30, 2026 and 2025 should be read in conjunction with our financial statements and the notes to those financial statements that are included elsewhere in this Quarterly Report on Form 10-Q. This discussion and analysis should be read in conjunction with the Company’s audited financial statements and related disclosures as of December 31, 2025, which are included in the Form 10-K (the “Annual Report”) filed with the Securities and Exchange Commission (“SEC”) on May 22, 2026. References in this Management’s Discussion and Analysis of Financial Condition and Results of Operations to “us”, “we”, “our” and similar terms refer to the Company and its subsidiaries. This Management’s Discussion and Analysis of Financial Condition and Results of Operations contains statements that are forward-looking. These statements are based on current expectations and assumptions that are subject to risk, uncertainties and other factors. These statements are often identified by the use of words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intend,” “could,” “estimate,” or “continue,” and similar expressions or variations. Actual results could differ materially because of the factors discussed in “Risk Factors” in our Annual Report, and other factors that we may not know. Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements, all of which are expressly qualified by the statements above, to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q.

Previous wording

In-person experience revenues decreased by approximately $0.6 million to approximately $1.1 million for the three months ended March 31, 2026 from approximately $1.7 million for the three months ended March 31, 2025. The decrease in event revenue is primarily attributable to the number of events held during 2026 versus the quantity of such events in the prior year.

Current wording

In-person experience revenues decreased by approximately $0.3 million to approximately $0.8 million for the three months ended June 30, 2026 from approximately $1.2 million for the three months ended June 30, 2025. The decrease in event revenue is primarily attributable to the number of events held during 2026 versus the quantity of such events in the prior year.

Previous wording

Casual mobile gaming revenue was $0.5 million and $0.6 million for the three months ended March 31, 2026 and 2025, respectively. The decrease in casual mobile games revenue was primarily due to contraction of the online card game market as well as increasing competition from new mobile game developers.

Current wording

Casual mobile gaming revenue was $0.4 million and $0.8 million for the three months ended June 30, 2026 and 2025, respectively. The decrease in casual mobile games revenue was primarily due to contraction of the online card game market as well as increasing competition from new mobile game developers.

Previous wording

In-person costs (exclusive of depreciation and amortization) decreased by approximately $0.5 million, or 62%, to approximately $0.3 million for the three months ended March 31, 2026 from approximately $0.9 million for the three months ended March 31, 2025. The decrease is the result of the costs associated with third party events held at the arena during 2026 compared to 2025

Current wording

In-person costs (exclusive of depreciation and amortization) decreased by approximately $0.2 million to approximately $0.5 million for the three months ended June 30 2026 from approximately $0.6 million for the three months ended June 30, 2025. The decrease is the result of the costs associated with third party events held at the arena during 2026 compared to 2025.

Previous wording

Casual mobile gaming costs (exclusive of depreciation and amortization) were $0.5 million for the three months ended March 31, 2026 and $0.6 million for the three months ended March 31, 2025, respectively, resulting from a decrease in user incentive, user acquisition and other costs directly associated with the decline in revenues.

Current wording

Casual mobile gaming costs (exclusive of depreciation and amortization) were $0.3 million for the three months ended June 30, 2026 and $0.7 million for the three months ended June 30, 2025, respectively, resulting from a decrease in user incentive, user acquisition and other costs directly associated with the decline in revenues.

Previous wording

Research and development expenses were $208 thousand and $181 thousand for the three months ended March 31, 2026 and 2025, respectively. Research and development expenses consist principally of costs related to the development of new casual mobile games for ZTech.

Current wording

Research and development expenses were $38 thousand and $167 thousand for the three months ended June 30, 2026 and 2025, respectively. Research and development expenses consist principally of costs related to the development of new casual mobile games for Z-Tech.

Previous wording

Selling and marketing expenses decreased by approximately $29 thousand to approximately $11 thousand for the three months ended March 31, 2026 from approximately $40 thousand for the three months ended March 31, 2025.

Current wording

Selling and marketing expenses decreased by approximately $72 thousand to approximately $9 thousand for the three months ended June 30, 2026 from approximately $82 thousand for the three months ended June 30, 2025.

Previous wording

General and administrative expenses decreased by approximately $1.7 million, or 31%, to approximately $3.8 million for the three months ended March 31, 2026, from approximately $5.5 million for the three months ended March 31, 2025. The decrease in general and administrative expenses resulted primarily from a $2.5 million decrease in legal and professional fees incurred during 2025 in connection with a complaint filed by a dissident stockholder, a $0.2 million decrease in share based compensation, as well as a $0.4 million decrease in salaries and related costs. These decreases were partially offset by a $0.7 CECL allowance on the Company’s loans receivable, and a $0.8 million expense under a strategic cooperation agreement, which represented a significant first step in the Company’s planned development into a leading global fiber optic communication, computing power, and AI-enabled services provider,

Current wording

General and administrative expenses decreased by approximately $2.4 million, or 40%, to approximately $3.6 million for the three months ended June 30, 2026, from approximately $6.0 million for the three months ended June 30, 2025. The decrease in general and administrative expenses resulted primarily from a $2.9 million decrease in legal and professional fees principally incurred in connection with a complaint filed by a dissident stockholder along with a proxy contest between the Company and such stockholder, a $0.3 million decrease indecrease in audit, tax and financial reporting fees, a $0.2 million decrease in directors’ and officers’ insurance costs, as well as a $0.2 million decrease in salaries and related costs. These decreases were partially offset by a$0.6 million CECL allowance on the Company’s loans receivable, a $0.2 million payment under a strategic cooperation agreement, which represented a significant first step in the Company’s planned development into a leading global fiber optic communication, computing power, and AI-enabled services provider, and a $0.5 million charge to operations for various M&A related consulting and advisory services.

Previous wording

The Company recognized a loss of $1.6 million on its investments in marketable securities and certain derivative instruments during the three months ended March 31, 2026, due to the change in the fair value of these investments during the period. During the three months ended March 31, 2025, the Company recognized a loss of $275 thousand on its investments in marketable securities. There were no investments in derivative instruments during the three months ended March 31, 2025.

Current wording

The Company recognized a loss of $0.6 million on its investments in marketable securities and certain derivative instruments during the three months ended June 30, 2026, due to the change in the fair value of these investments during the period. During the three months ended June 30, 2025, the Company recognized a gain of $0.8 million on its investments in marketable securities. There were no investments in derivative instruments during the three months ended June 30, 2025.

Previous wording

The loss on foreign currency transactions was approximately $0.9 million for the three months ended March 31, 2026 compared to $0.6 million for the three months ended March 31, 2025. These losses result from changes in the exchange rate of the Japanese Yen to United States Dollar between the dates certain loans payable were borrowed, the dates certain loans receivable were issued, and the dates certain equity linked notes, bond linked notes, ETF linked notes, and foreign securities were purchased and their remeasurements on March 31, 2026 and 2025.

Current wording

The gain (loss) on foreign currency transactions was approximately ($0.2) million and ($0.5) million for the three months ended June 30, 2026 and 2025, respectively These gains and losses result from changes in the exchange rate of the Japanese Yen to United States Dollar between the dates certain loans payable were borrowed, the dates certain loans receivable were issued, and the dates certain equity linked notes, bond linked notes, ETF linked notes, and foreign securities were purchased and their remeasurements on June 30, 2026 and 2025.

Previous wording

Interest income, net, was approximately $937 thousand for the three months ended March 31, 2026 compared to approximately $864 thousand of interest income for the three months ended March 31, 2025. The increase is a result of the interest earned on fixed term deposits and equity, bond, and ETF linked notes, as well as interest earned on loans receivable during the periods.

Current wording

Interest income, net, was approximately $1.2 million for the three months ended June 30, 2026, compared to approximately $1.0 million for the three months ended June 30, 2025. The increase is a result of the interest earned on fixed term deposits and equity, bond, and ETF linked notes, as well as interest earned on loans receivable during the periods.

Previous wording

As of March 31, 2026, we had cash and cash equivalents of approximately $4.3 million (not including $26.7 million of short-term investments and $0.4 million of marketable securities) and working capital of approximately $23.0 million.

Current wording

As of June 30, 2026, we had cash and cash equivalents of approximately $10.4 million (not including $18.7 million of short-term investments and $0.4 million of marketable securities) and working capital of approximately $21.2 million.

Previous wording

Cash requirements for our current liabilities include approximately $14.4 million for loans payable, approximately $14.8 million in the aggregate for accounts payable and accrued expenses, which excludes approximately $2.3 million for derivative instruments included in accrued expenses and other current liabilities on the condensed consolidated balance sheet, and approximately $1.7 million for the current portion of an operating lease liability. Cash requirements for non-current liabilities include approximately $2.0 million for the non-current portion of an operating lease liability. The Company intends to meet these cash requirements from its current cash, investments and loan receivable balances.

Current wording

Cash requirements for our current liabilities include approximately $14.0 million for loans payable, approximately $13.6 million in the aggregate for accounts payable and accrued expenses, and approximately $0.1 million for the current portion of an operating lease liability. Cash requirements for non-current liabilities include approximately $0.1 million for the non-current portion of an operating lease liability. The Company intends to meet these cash requirements from its current cash, investments and loan receivable balances.

Previous wording

The table below summarizes cash flows for the three months ended March 31, 2026 and 2025:

Current wording

The table below summarizes cash flows for the six months ended June 30, 2026 and 2025:

Previous wording

Net cash used in operating activities for the three months ended March 31, 2026 was approximately $0.7 million and net cash used in operating activities for the three months ended March 31, 2025 was approximately $2.2 million, representing a decreased usage of $1.5 million.

Current wording

Net cash used in operating activities for the six months ended June 30, 2026 was approximately $3.0 million and net cash used in operating activities for the six months ended June 30, 2025 was approximately $3.1 million, representing a decreased usage of $0.1 million.

Previous wording

During the three months ended March 31, 2026 and 2025, the net cash used in operating activities, respectively, was primarily attributable to the net loss of approximately $5.2 million and $4.9 million, respectively, adjusted for approximately $3.1 million and $1.5 million, respectively, of net non-cash expenses, and approximately $1.4 and $1.2 million, respectively, of cash used to fund changes in the levels of operating assets and liabilities.

Current wording

During the six months ended June 30, 2026 and 2025, the net cash used in operating activities, respectively, was primarily attributable to the net loss of approximately $7.2 million and $9.7 million, respectively, adjusted for approximately $3.0 million and $2.8 million, respectively, of net non-cash expenses, and approximately $1.2 million and $3.9 million, respectively, of cash generated by changes in the levels of operating assets and liabilities.

Previous wording

Net Cash Used In Investing Activities

Current wording

Net Cash Provided By (Used In) Investing Activities

Previous wording

Net cash provided by investing activities for the three months ended March 31, 2026 was approximately $11.4 million, which consisted of $54.4 million in proceeds from the maturing of short-term investments and $2.2 million in proceeds from the sale of marketable securities, partially offset by $44.3 million used for the purchase of short-term investments and $1.0 million used for the purchase of marketable securities.

Current wording

Net cash provided by investing activities for the six months ended June 30, 2026 was approximately $20.0 million, which consisted of $54.3 million in proceeds from the maturity of short-term investments, $3.1 million in proceeds from the sale of marketable securities, $57.6 million in proceeds from the early withdrawal of short-term investments, and $0.2 in proceeds from the sale of digital assets, partially offset by $93.2 million used for the purchase of short-term investments and $2.0 million used for the purchase of marketable securities.

Previous wording

Net cash used in investing activities for the three months ended March 31, 2025 was approximately $45.1 million, which consisted of $64.0 million used for the purchase of short-term investments, $2.4 million used for loans receivable, $2.6 million used for a land deposit, and $2.5 million used for the investments, partially offset by $23.8 million in proceeds from the maturing of short-term investments, $1.3 million from proceeds from repayment of short-term loans, and $1.2 million from proceeds from the sale of marketable securities.

Current wording

Net cash used in investing activities for the six months ended June 30, 2025 was approximately $34.1 million, which consisted of $127.5 million used for the purchase of short-term investments, $10.6 million used for loans receivable, $1.7 million used for the purchase of land use rights, and $2.5 million used for the investment in a unconsolidated affiliate, partially offset by $102.4 million in proceeds from the maturing of short-term investments, $4.5 million from proceeds from the repayment of short-term loans, and $1.2 million from proceeds from the sale of marketable securities.

Previous wording

Net cash used in financing activities during the three months ended March 31, 2026, was approximately $18.4. million, consisting entirely of the repayment of short-term loans.

Current wording

Net cash used in financing activities during the six months ended June 30, 2026, was approximately $18.4. million, consisting entirely of the repayment of short-term loans.

Previous wording

Net cash provided by financing activities during the three months ended March 31, 2025 was approximately $7.5 million, which consisted of $19.2 million in proceeds from a short-term loan of, partially offset by a repayment of short-term loans of 11.7 million.

Current wording

Net cash provided by financing activities during the six months ended June 30, 2025 was approximately $1.0 million, which consisted of $30.2 million in proceeds from short-term loans, which is partially offset by a repayment of short-term loans of 22.7 million and payment upon cancellation of common stock previously issued of $6.6 million.

Previous wording

We consider an accounting estimate to be critical if: (i) the accounting estimate requires us to make assumptions about matters that were highly uncertain at the time the accounting estimate was made, and (ii) changes in the estimate that are reasonably likely to occur from period to period or use of different estimates that we reasonably could have used in the current period, would have a material impact on our financial condition or results of operations. We consider accounting for income taxes, impairment of long-lived assets, and impairment of goodwill to be critical accounting estimates. There are other items within our financial statements that require estimation but are not deemed critical, as defined above.

Current wording

We consider an accounting estimate to be critical if: (i) the accounting estimate requires us to make assumptions about matters that were highly uncertain at the time the accounting estimate was made, and (ii) changes in the estimate that are reasonably likely to occur from period to period or use of different estimates that we reasonably could have used in the current period, would have a material impact on our financial condition or results of operations. We consider accounting for income taxes, impairment of long-lived assets, impairment of goodwill and current expected credit loss on loans receivable to be critical accounting estimates. There are other items within our financial statements that require estimation but are not deemed critical, as defined above.