Agape ATP Corp

Previous wording

The decrease in revenue from the Company’s network marketing business was due to a strategic shift in focus toward new revenue streams aimed at restoring growth and diversifying income sources. Additionally, revenue from the Company’s operations in the provision of complementary health therapies declined because, in 2025, the Company did not generate any revenue from overseas customers. The increase in revenue from skin care and healthcare products was due to the company’s digital advertisement campaign and marketing activities to promote the skin care and healthcare products.

Current wording

The decrease in revenue from the Company’s network marketing business was due to a strategic shift in focus toward other revenue streams aim at restoring growth and diversifying income sources.

Previous wording

Cost of revenue for the three months ended September 30, 2025 amounted to $131,490 as compared to $147,104 for the three months ended September 30, 2024, a decrease of $15,614, or approximately 10.6%. The decrease was due to the decrease in revenue in the Company’s network marketing business, the varying gross profit margins in the Company’s operations in the provision of complementary health therapies and the low cost of revenue in the skin care and health care products as compared to the operation in the Company’s network marketing business and the provision of complementary health therapies.

Current wording

Cost of revenue for the three months ended March 31, 2026 amounted to $114,249 as compared to $132,751 for the three months ended March 31, 2025, represented a decrease of $18,502 or approximately 13.9%. The decrease was due to the decrease in revenue from the Company’s network marketing business and the varying gross profit margins in the Company’s operations in the provision of complementary health therapies.

Previous wording

Cost of revenue typically comprise of cost of goods purchased, packing materials and services acquired.

Current wording

Cost of revenue typically comprise of freight-in, cost of goods purchased, packing materials and services acquired.

Previous wording

Gross profit for the nine months ended September 30, 2025, amounted to $604,329, represented a gross margin of approximately 53.7% as compared to $581,166 for the nine months ended September 30, 2024, equivalent to a gross margin of approximately 60.4%. The decrease in gross margin was due to the inventory write off in the Company’s network marketing business, the varying type of health therapies offered, gross margin associated with the provision of complementary health therapies and low gross margin in the new operation in green energy.

Current wording

Gross profit for the three months ended March 31, 2026 amounted to $159,409, represented a gross margin of 58.3% as compared to $156,286 for the three months ended March 31, 2025, equivalent to a gross margin of 54.1%. The increase in gross margin was due to the varying type of health therapies offered, gross margin associated with the provision of complementary health therapies.

Previous wording

Our operating expenses consist of selling expenses, commission expenses and general and administrative expenses (as defined below). Total operating expenses were $840,424 for the three months ended September 30, 2025, increased by $108,129 or approximately 14.8% from $732,295 for the three months ended September 30, 2024.

Current wording

Our operating expenses consist of selling expenses, commission expenses and general and administrative expenses.

Previous wording

Selling expenses for the three months ended September 30, 2025 amounted to $61,623 as compared to $41,582 for the three months ended September 30, 2024, an increase of $20,041, or approximately 48.2%. The Company’s selling expenses typically comprise ofsalaries and benefits expenses, credit card processing fees, advertisement and promotional expenses.

Current wording

Selling expenses for the three months ended March 31, 2026 amounted to $37,149 as compared to $63,052 for the three months ended March 31, 2025, represented a decrease of $25,903 or approximately 41.1%, mainly due to the decrease in advertisement cost. The Company’s selling expenses typically comprise ofsalaries and benefits expenses, credit card processing fees, advertisement and promotional expenses.

Previous wording

Commission expenses were $27,386 and $6,894 for the three months ended September 30, 2025 and 2024, respectively. The Company pays commission in Company’s network marketing business and the operation in wellness and wellbeing lifestyle. The increase in commission expenses was due to the increase in revenue from the operation in wellness and wellbeing lifestyle.

Current wording

Commission expenses were $4,920 and $7,945 for the three months ended March 31, 2026 and 2025, respectively. The decrease in commission expenses was in line with the decrease in revenue in the Company’s network marketing business.

Previous wording

G&A expenses for the three months ended September 30, 2025 amounted to $751,415, as compared to $683,819 for the three months ended September 30, 2024, an increase of $67,596, or approximately 9.9%. The Company’s G&A expenses typically comprise ofsalaries and benefits expenses, rental expenses, professional expenses, depreciation expenses and other expenses. The increase in G&A expenses was mainly due to the expenses incurred in the operation in wellness and wellbeing lifestyle.

Current wording

G&A expenses for the three months ended March 31, 2026 amounted to $794,712, as compared to $805,693 for the three months ended March 31, 2025, represented a decrease of $10,981 or approximately 1.4%. The decrease in G&A expenses was mainly due to the decrease in company event and activities. The Company’s G&A expenses typically comprise ofsalaries and benefits expenses, rental expenses, professional expenses, depreciation expenses and other expenses.

Previous wording

Net loss increased by $71,331 from a net loss of $524,039 for the three months ended September 30, 2024 to a net loss of $595,370 for the three months ended September 30, 2025, mainly due to reasons as discussed above.

Current wording

Net loss decreased by $451,524 from net loss of $712,919 for the three months ended March 31, 2025 to net loss of $340,906 for the three months ended March 31, 2026, mainly due to reasons as discussed above.

Previous wording

As of September 30, 2025, the Company had working capital of $22,585,047 consisting of cash and cash in bank of $133,714 and $0 of time deposit as compared to working capital of $1,656,571 consisted of cash and cash in bank of $240,243 and time deposits of $1,800,000 as of December 31, 2024. The Company had a net loss of $1,931,535 for the nine months ended September 30, 2025 and accumulated deficits of $11,420,899 as of September 30, 2025 as compared to net loss of $2,486,044 for the year ended December 31, 2024 and accumulated deficits of $9,518,045 as of December 31, 2024.

Current wording

As of March 31, 2026, the Company had working capital of $21,918,986 consisting of cash and cash in bank of $207,296 and time deposits of $1,866 as compared to working capital of $22,236,994 consisted of cash and cash in bank of $140,072 and time deposits of $0 as of December 31, 2025. The Company had a net loss of $340,906 for the three months ended March 31, 2026 and accumulated deficits of $12,125,455 as of March 31, 2026 as compared to net loss of $2,307,607 for the year ended December 31, 2025 and accumulated deficits of $11,797,836 as of December 31, 2025.

Previous wording

The following summarizes the key components of our cash flows for the nine months ended September 30, 2025 and 2024:

Current wording

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

Previous wording

Net cash used in operating activities for the nine months ended September 30, 2024 was $2,080,879, comprised of net loss of $1,659,449, gain on disposal of office equipment of $111, the increase in inventories of $6,473, the increase in prepaid taxes of $8,592, the increase in prepayments and deposits of $329,898, the increase in other receivables $949, the decrease in customer deposits of $16,349, the payment of operating lease liabilities of $102,605, the decrease in other payables (including related parties) and accrued liabilities of $186,986. The net cash used in operating activities was mainly offset by non-cash depreciation and amortization expense of $36,022, amortization of finance assets of $18,956, amortization of operating right-of-use assets of $103,187, unrealized holding loss on marketable securities of $6,642, deferred tax benefit of $218, allowance for credit loss $28,359, the decrease in accounts receivables of $6,353, the decrease in other receivables (including related parties) of $8,858, the increase in account payable (including related parties) $8,724, and the increase of income tax payable of $13,213.

Current wording

Net cash used in operating activities for the three months ended March 31, 2026 was $394,770, and were mainly comprised of the net loss of $340,906, unrealized holding gain on marketable securities of $12,232, unrealized exchange gain of 307,324, increase in other receivables from related parties of $343, increase in prepaid taxes of $1,942, the decrease in customer deposits of $4,908, the payment of operating lease liabilities of $45,587. The net cash used in operating activities was mainly offset by non-cash depreciation and amortization expense of $2,739, amortization of finance assets of $11,906, amortization of operating right-of-use assets of $45,361, allowance for credit lossof $417, inventory write off of $2,099, the decrease in accounts receivables of $7,765, the decrease in inventories of $749, decrease in prepayments and deposits of $18,137, the decrease in other receivable of $7, increase in accounts payables (including related parties) of $5,533, the increase in other payables (including related parties) and accrued liabilities of $223,759.

Previous wording

Net cash used in operating activities for the nine months ended September 30, 2025 was $2,205,074, comprised of net loss of $1,931,535, unrealized holding gain on marketable securities of $3,165, the increase in prepaid taxes of $3,767, the increase in prepayments and deposits of $452,749, the decrease in account payable (including related parties) of $20,785, the decrease in customer deposits of $4,211, the payment of operating lease liabilities of $117,172, the decrease in other payables (including related parties) and accrued liabilities of $98,348, the decrease of income tax payable of $4,601. The net cash used in operating activities was mainly offset by non-cash depreciation and amortization expense of $22,015, amortization of finance assets of $32,768, amortization of operating right-of-use assets of $116,549, inventory write off of $6,961 and allowance for credit loss $11,106, the decrease in accounts receivables of $37,284, the decrease in other receivables from related parties of $141, the decrease in inventories of $1,742, the decrease in other receivables of $2,517 and the increase in amount due to directors of $200,176.

Current wording

Net cash used in operating activities for the three months ended March 31, 2025 was $1,453,874, and were mainly comprised of the net loss of $712,919, increase in other receivables from related parties of $2,194, increase in prepaid taxes of $3,990, increase in prepayments and deposits of $581,028, decrease in accounts payables (including related parties) of $33,333, the decrease in customer deposits of $6,246, the payment of operating lease liabilities of $37,518, the decrease in other payables (including related parties) and accrued liabilities of $163,419. The net cash used in operating activities was mainly offset by non-cash depreciation and amortization expense of $13,709, amortization of finance assets of $10,634, amortization of operating right-of-use assets of $37,316, allowance for credit lossof $8,280, inventory write off of $6,777, unrealized holding loss on marketable securities of $1,096, the decrease in accounts receivables of $4,366, the decrease in inventories of $2,898, and the decrease in other receivable of $1,697.

Previous wording

Net cash used in investing activities for the nine months ended September 30, 2025 was $23,000,667, which was mainly from advances for investment.

Current wording

Net cash used in investing activities for the three months ended March 31, 2025 was $23,000,649, which was mainly from advances for investment.

Previous wording

Net cash provided by financing activities for the nine months ended September 30, 2025 was $23,297,009, consisted of the proceeds from issuance of common stock for $23,000,000, reduction of finance lease liability of $16,710 and advance from director of $313,719.

Current wording

Net cash provided by financing activities for the three months ended March 31, 2025 was $22,994,658, which was mainly from the proceeds from issuance of shares of common stock.

Previous wording

Management reviews inventory on hand for estimated obsolescence or unmarketable items, as compared to future demand requirements and the shelf life of the various products. Based on the review, the Company records inventory write-downs, when necessary, when costs exceed expected net realizable value. For the nine months ended September 30, 2025 and 2024, there were no inventory write-down, however, there were $6,961 and $0 inventory write-off respectively.

Current wording

Management reviews inventory on hand for estimated obsolescence or unmarketable items, as compared to future demand requirements and the shelf life of the various products. Based on the review, the Company records inventory write-downs, when necessary, when costs exceed expected net realizable value. For the three months ended March 31, 2026 and 2025, there were no inventory write-down; and $2,099 and $6,777 inventory write-off respectively.

Previous wording

As of September 30, 2025 and December 31, 2024, the carrying amounts of operating right-of-use assets amounted to $119,021 and $224,595, respectively, and property, plant and equipment amounted to $15,122 and $31,463, receptively. No impairment losses on operating right-of-use assets and property, plant and equipment were recognized as of September 30, 2025 and December 31, 2024.

Current wording

As of March 31, 2026 and December 31, 2025, the carrying amounts of operating right-of-use assets amounted to $58,270 and $102,101, and property, plant and equipment amounted to $13,228 and $14,570. No impairment losses on operating right-of-use assets and property, plant and equipment were recognized as of March 31, 2026 and December 31, 2025.

Previous wording

The Company estimates and records an allowance for credit loss related to its accounts receivable. Credit losses are determined by Current Estimate of Expected Credit Losses model in accordance with Topic 326 – Financial Instruments – Credit Losses. For accounts receivable, the Company considers the age of the accounts receivable balances, credit quality of the Company’s customers based on ongoing credit evaluations, current economic conditions, reasonable and supportable forecasts of future economic conditions, and other factors that may affect the Company’s ability to collect from customers. As of September 30, 2025 and December 31, 2024, the Company recognize an allowance for credit loss of $6,559 and $32,857, respectively.

Current wording

The Company estimates and records an allowance for credit loss related to its accounts receivable. Credit losses are determined by Current Estimate of Expected Credit Losses model in accordance with Topic 326 – Financial Instruments – Credit Losses. For accounts receivable, the Company considers the age of the accounts receivable balances, credit quality of the Company’s customers based on ongoing credit evaluations, current economic conditions, reasonable and supportable forecasts of future economic conditions, and other factors that may affect the Company’s ability to collect from customers. As of March 31, 2026 and December 31, 2025, the Company recognize an allowance for credit loss of $8,549 and $8,082, respectively.

Previous wording

The Company offers various coupon programs to customers, which result in the potential redemption of coupons against future purchases. The estimation of coupon redemption requires assumptions. This estimate is based on historical redemption patterns, customer behavior trends, and the terms and conditions of the coupon programs. Management considers factors such as the type of coupon, the period of validity that could influence redemption rates. The Company makes estimates about the likelihood and timing of coupon redemptions, which may vary based on changing customer behavior and economic conditions. If the actual redemption rate differs from the estimated rate, it could impact the redemption liability and related expenses in future periods. The allowance for coupon redemption is regularly reviewed and adjusted as more information becomes available to ensure that it reflects the expected redemption accurately.

Current wording

The Company offers various coupon programs to customers, which result in the potential redemption of coupons against future purchases. The estimation of coupon redemption requires assumptions. This estimate is based on historical redemption patterns, customer behaviour trends, and the terms and conditions of the coupon programs. Management considers factors such as the type of coupon, the period of validity that could influence redemption rates. The Company makes estimates about the likelihood and timing of coupon redemptions, which may vary based on changing customer behaviour and economic conditions. If the actual redemption rate differs from the estimated rate, it could impact the redemption liability and related expenses in future periods. The allowance for coupon redemption is regularly reviewed and adjusted as more information becomes available to ensure that it reflects the expected redemption accurately.

Previous wording

In November 2024, the FASB issued ASU 2024-04 “Debt – Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments”. This ASU clarifies the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. The clarification is effective for annual reporting periods beginning after December 15, 2025, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the effect of adopting of this ASU.

Current wording

In November 2024, the FASB issued ASU 2024-04 “Debt – Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments”. This ASU clarifies the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. The clarification is effective for annual reporting periods beginning after December 15, 2025, and interim periods within those fiscal years. Early adoption is permitted. The adoption of ASU 2024-04 has no material impact on the Company consolidated financial statements.

Previous wording

In July 2025, the FASB issued ASU 2025-05 “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets”. This ASU provides a practical expedient that allows companies to assume that current conditions as of the balance sheet date do not change for the remaining life of the asset. This ASU is effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within annual reporting periods. Early adoption is permitted. The Company is currently evaluating the effect of adopting of this ASU.

Current wording

In July 2025, the FASB issued ASU 2025-05 “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets”. This ASU provides a practical expedient that allows companies to assume that current conditions as of the balance sheet date do not change for the remaining life of the asset. This ASU is effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within annual reporting periods. Early adoption is permitted. The adoption of ASU2024-05 has no material impact on the Company’s consolidated financial statements.