VS MEDIA Holdings Ltd

Operating Activities

Net cash used in operating activities was $768,053 and $2,155,713 for the six months ended June 30, 2026 and 2025, respectively.

Net cash used in operating activities for the six months ended June 30, 2026 was primarily the result of net loss of $254,213, a decrease in accounts and other payables of $385,851, operating lease liabilities of $32,293 and increase in accounts and other receivables of $193,146, and non-cash adjustments consisting of depreciation and amortization of $5,577, non-cash lease expenses of $32,292, share of loss from equity investment of $174,899, loss on dilution of equity investment of $129,106 and interest income, related party of $244,424.

Net cash used in operating activities for the six months ended June 30, 2025 was primarily the result of the net loss of $4,444,519, decrease in accounts payable of $297,470 and accruals and other payables of $207,386. These amounts were partially offset by a decrease in accounts receivable of $497,507, deposits, prepayments and other receivables of $1,861,053, an increase in receipt in advance of $286,661, non-cash adjustments consisting of depreciation on plant and equipment of $6,754, share of loss from equity investment of $131,484 and amortization of intangible assets of $10,203.

We do not believe we have a material collection risk under our business model that will have a negative impact on collectability. Our business has continued to grow and the demand for our services has been increasing. Accounts receivable balances that are past due under the applicable credit terms are minimal.