CTW
For the period ended Oct 15, 2026. Filed Oct 15, 2026.
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Oct 15, 2026 · Filed Oct 15, 2026
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Contents
EX-99.1 · Segment Reporting
Segment Reporting
| For the years ended July 31, | |||
|---|---|---|---|
| 2026 | 2025 | 2024 | |
| Consolidated in-game purchases | $96,813,340 | $106,994,440 | $84,461,982 |
| Less: Revenue share with game developers and IP holders | 15,093,625 | 15,898,478 | 14,975,047 |
| Transaction fee | 4,526,299 | 5,265,054 | 3,812,118 |
| Advertising expense | 41,013,358 | 52,396,511 | 37,309,197 |
| Server cost directly related to hosting the games | 3,889,772 | 2,088,553 | 1,319,704 |
| Segment profits | $32,290,286 | $31,345,844 | $27,045,916 |
| Less: Payroll and related cost | 17,325,876 | 13,621,485 | 9,756,710 |
| Lease expense | 3,148,822 | 2,661,149 | 1,738,249 |
| Depreciation and amortization expense | 2,076,874 | 2,702,360 | 2,099,728 |
| Impairment expense | 2,635,761 | 3,632,218 | 447,904 |
| Recoup of advances made to game developers | 3,222,344 | 3,583,143 | 2,477,840 |
| Other cost of sales (1) | 4,490,687 | 2,087,031 | 1,563,366 |
| Other selling and marketing expenses (2) | 2,346,442 | 1,713,981 | 1,402,889 |
| Other general and administrative expenses (3) | 4,367,215 | 2,409,601 | 902,948 |
| Total other operating expense | $39,614,021 | $32,410,968 | $20,389,634 |
| (Loss) income from operations | $(7,323,735) | $(1,065,124) | $6,656,282 |
| Interest income, net | 540,933 | 494,358 | 300,985 |
| Foreign currency transaction gain (loss) | 293,764 | (287,946) | 784,674 |
| Other income | 424,638 | 555,012 | 454,286 |
| Contingent gain on recovery of previously impaired assets | 238,561 | 4,709,029 | — |
| (Loss) income before income tax expense | $(5,825,839) | $4,405,329 | $8,196,227 |
| (1) | Other cost of sales mainly includes server and infrastructure cost that are not directly related to the host of a specific game and certain outsourcing cost. |
| (2) | Other selling and marketing expenses mainly includes cost associated with meeting, travel and promotions. |
| (3) | Other general and administrative expenses mainly includes cost associated with professional services, office supplies, recruiting and education. |
An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, and is identified on the basis of the internal financial reports that are provided to and regularly reviewed by the Group’s chief operating decision maker (“CODM”) in order to allocate resources and assess performance of the segment.
The management of the Group concludes that it has only one reporting segment. The Group provides game distribution and related services to game developers. The Group’s services have similar economic characteristics with respect to nature and form of the services provided. The Group’s chief operating decision maker has been identified as the Chief Executive Officer, who reviews Consolidated results when making decisions about allocating resources and assessing performance of the Group, rather than by geographic area; hence the Group has only one reporting segment. CODM reviews operation results on the consolidated in-game purchase amount, revenue share with game developers and IP holders, advertising expenses, transaction fees, and server cost directly related to the host of games. The above table summarizes the operating results reviewed by CODM and reconciliation to (loss) income before income tax as reported in the consolidated statements of comprehensive (loss) income.
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