VIVIC CORP.

Previous wording

Our yachts are manufactured by third parties selected by us on the basis of their production capabilities, technical ability and financial wherewithal. Once a customer places an order, we negotiate and sign an original equipment manufacturer (“OEM”) contract with a selected local manufacturer. Upon completion, we deliver the boat to the location designated by our customer. Our principal supplier and distributor in mainland China is Guangdong Weiguan Ship Technology Co., Ltd., which utilizes the mainland’s production and supply chain advantages to provide us with yacht production, delivery, and after-sales services based on our designs. Guangdong Weiguan is responsible for providing the required products and after-sales services for all sales orders in mainland China and remits 15% of the order amount of each yacht to us as a “VIVIC” brand usage fee.

Current wording

Our yachts are manufactured by third parties selected by us on the basis of their production capabilities, technical ability and financial wherewithal. Once a customer places an order, we negotiate and sign an original equipment manufacturer (“OEM”) contract with a selected local manufacturer. Upon completion, we deliver the boat to the location designated by our customer. Our principal supplier and distributor in mainland China is Weiguan Ship, which utilizes the mainland’s production and supply chain advantages to provide us with yacht production, delivery, and after-sales services based on our designs. Weiguan Ship is responsible for providing the required products and after-sales services for all sales orders in mainland China and remits 15% of the order amount of each yacht to us as a “VIVIC” brand usage fee.

Previous wording

In 2023, we determined to focus our efforts on yacht sales in Taiwan and other selected regions throughout the world, and since that time have disposed of all of our business operations in mainland China. On July 12, 2023, our subsidiary, Vivic Corporation (Hong Kong) Co. Limited (“Vivic Hong Kong”), entered into a Stock Purchase Agreement with Yun-Kuang Kung pursuant to which Mr. Kung acquired all of the shares of our wholly-owned subsidiary, Guangdong Weiguan Ship Tech Co., Ltd. (“Weiguan Ship”). The divestiture of Weiguan Ship completed our plan to divest of all activities other than our ongoing yacht business in Taiwan.

Current wording

In 2023, we determined to focus our efforts on yacht sales in Taiwan and other selected regions throughout the world, and since that time have disposed of all of our business operations in mainland China. On July 12, 2023, our subsidiary, Vivic Corporation (Hong Kong) Co. Limited (“Vivic Hong Kong”), entered into a Stock Purchase Agreement with Yun-Kuang Kung pursuant to which Mr. Kung acquired all of the shares of our wholly-owned subsidiary, Weiguan Ship. The divestiture of Weiguan Ship completed our plan to divest of all activities other than our ongoing yacht business in Taiwan.

Previous wording

As a result of the sale of our interest in Weiguan Ship and its subsidiaries, the assets and related liabilities and the results of operations of such entities are included our financial statements as discontinued operations. The following table sets forth the results of our operations for the periods indicated as a percentage of net sales. Certain columns may not add due to rounding.

Current wording

As a result of the sale of our interest in Weiguan Ship and its subsidiaries, the assets and related liabilities and the results of operations of such entities are included in our financial statements as discontinued operations. The following table sets forth the results of our operations for the periods indicated as a percentage of net sales. Certain columns may not add due to rounding.

Previous wording

There was no revenue for the three months ended December 31, 2024. Revenue from continuing operations was $809,899 for the three months ended December 31, 2023. The revenue for the three months ended December 31, 2023 was mainly due to the inception of sales of yacht at our Taiwan branch in 2023.

Current wording

There was no revenue for the three months ended March 31, 2025. Revenue was $1,837,442 for the three months ended March 31, 2024, which was mainly from the sales of yachts at our Taiwan Branch.

Previous wording

Cost of revenue from continuing operations was $nil for the three months ended December 31, 2024. Cost of revenue from continuing operations was $689,511 for the three months ended December 31, 2023. The cost of revenues for the three months ended December 31, 2023 was mainly due to the costs of yacht sales at our Taiwan branch.

Current wording

Cost of revenue was $nil for the three months ended March 31, 2025. Cost of revenue was $649,491 for the three months ended March 31, 2024. The cost of revenues for the three months ended March 31, 2024 was mainly due to the costs of yacht sales at our Taiwan branch.

Previous wording

Gross profit (loss) for the three months ended December 31, 2024, was $nil as we had no sales. Gross profit from continuing operations was $120,388 for the three months ended December 31, 2023, which was all from yachts sales.

Current wording

Gross profit for the three months ended March 31, 2025 was $nil as we had no sales. Gross profit was $1,187,951 for the three months ended March 31, 2024, which was all from yachts sales.

Previous wording

General and administrative expenses consisted mainly of employee salaries and welfare, and expenses for business meetings, utilities, accounting, consulting, and legal services. General and administrative expenses were $329,402 for the three months ended December 31, 2024, compared to $137,654 for the three months ended December 31, 2023, an increase of $191,748 or 139.30%. The increase of G&A expenses mainly reflected increased professional fees of approximately $153,600, and increased subcontract labor fees of approximately $9,300.

Current wording

General and administrative expenses consisted mainly of employee salaries and welfare, and expenses for business meetings, utilities, accounting, consulting, and legal services. General and administrative expenses were $115,386 for the three months ended March 31, 2025, compared to $404,541 for the three months ended March 31, 2024, a decrease of $289,155 or 71.48%. The decrease of general and administrative (“G&A”) expenses mainly reflected decreased commission expense of approximately $318,007, which was partly offset by increased payroll expense by $16,211 and increased professional fee by $13,313.

Previous wording

On September 6, 2024, the Company entered an engagement agreement with an Investor Relation (“IR”) firm. The Company will pay the IR firm $500 cash per month and 1,000 shares of the Company’s common stock per month, to be paid quarterly. During the three months ended December 31, 2024, the Company recorded $6,150 stock compensation expense in respect of this arrangement.

Current wording

On September 6, 2024, the Company entered an engagement agreement with an Investor Relation (“IR”) firm. The Company will pay the IR firm $500 cash per month and 1,000 shares of the Company’s common stock per month, to be paid quarterly. During the three months ended March 31, 2025, the Company recorded $nil stock compensation expense in respect of this arrangement.

Previous wording

Net other expenses were $117,770 for the three months ended December 31, 2024, and $14,220 for the three months ended December 31, 2023. For the three months ended December 31, 2024, net other expenses mainly consisted of interest expense of $7,316, and other expenses of $110,454. For the three months ended December 31, 2023, net other expenses mainly consisted of interest expense of $5,074 and other expenses of $9,146.

Current wording

Net other expenses were $6,129 for the three months ended March 31, 2025, and $6,008 for the three months ended March 31, 2024. For the three months ended March 31, 2025, net other expenses mainly consisted of interest expense of $6,817, and other income of $688. For the three months ended March 31, 2024, net other expenses mainly consisted of interest expense of $6,008.

Previous wording

We had a net loss from continuing operations of $962,685 for the three months ended December 31, 2024, compared to a net loss of $33,017 for the three months ended December 31, 2023, an increase in our loss of $929,668. The increase in our net loss from continuing operations was mainly due to the decrease in our revenue and increased G&A expenses as described above.

Current wording

We had a net loss of $950,807 for the three months ended March 31, 2025, compared to a net income of $610,165 for the three months ended March 31, 2024, an increase in our net loss of $1,560,972 or 255.83%. The increase in our net loss from was mainly due to the decrease in our revenue and increased share-based compensation as described above.

Previous wording

Comparison of results of operations for the six months ended December 31, 2024, and 2023

Current wording

Comparison of results of operations for the nine months ended March 31, 2025, and 2024

Previous wording

Revenue was $44,243 for the six months ended December 31, 2024. Revenue from continuing operations was $1,600,942 for the six months ended December 31, 2023. The revenue for the six months ended December 31, 2024 was mainly from the sale of yacht models. We sold 100 yacht models to one of the Company’s directors below cost. We considered this as marketing and advertising because the director will give our yacht models to prospective purchasers to promote and market our yachts. The revenue for the six months ended December 31, 2023 was mainly due to the inception of sales of yachts at our Taiwan branch.

Current wording

Revenue was $44,243 for the nine months ended March 31, 2025. Revenue from continuing operations was $3,438,384 for the nine months ended March 31, 2024. The revenue for the nine months ended March 31, 2025 was mainly from the sale of yacht models. We sold 100 yacht models to one of the Company’s directors below cost. We considered this as marketing and advertising because the director will give our yacht models to prospective purchasers to promote and market our yachts. The revenue for the nine months ended March 31, 2024 was mainly from the sales of yachts at our Taiwan branch.

Previous wording

Cost of revenue from continuing operations was $128,584 for the six months ended December 31, 2024. Cost of revenue from continuing operations was $1,388,728 for the six months ended December 31, 2023. The cost of revenues in the six months ended December 31, 2024 was mainly due to costs associated with yacht model sales. We sold 100 yacht models to one of the Company’s directors below cost. We considered this as marketing and advertising because the director will give our yacht models to prospective purchasers to promote and market our yachts. The cost of revenues for the six months ended December 31, 2023 was mainly due to the costs of yacht sales at our Taiwan branch.

Current wording

Cost of revenue was $128,584 for the nine months ended March 31, 2025. Cost of revenue from continuing operations was $2,038,219 for the nine months ended March 31, 2024. The cost of revenues in the nine months ended March 31, 2025 was mainly due to costs associated with yacht model sales. We sold 100 yacht models to one of the Company’s directors below cost. We considered this as marketing and advertising because the director will give our yacht models to prospective purchasers to promote and market our yachts. The cost of revenues for the nine months ended March 31, 2024 was mainly due to the costs of yacht sales at our Taiwan branch.

Previous wording

Gross profit (loss) for the six months ended December 31, 2024, was a loss of $84,341 as we had no sales other than yacht model sale. Gross profit from continuing operations was $212,214 for the six months ended December 31, 2023. The gross loss in the six months ended December 31, 2024, was the result of our decision to sell yacht models below cost for marketing purposes, while gross profit in the six months ended December 31, 2023, was the result of yacht sales.

Current wording

Gross profit (loss) for the nine months ended March 31, 2025, was a loss of $84,341 as we had no sales other than yacht model sale. Gross profit from continuing operations was $1,400,165 for the nine months ended March 31, 2024. The gross loss in the nine months ended March 31, 2025, was the result of our decision to sell yacht models below cost for marketing purposes, while gross profit in the nine months ended March 31, 2024, was the result of yacht sales.

Previous wording

General and administrative expenses consisted mainly of employee salaries and welfare, and expenses for business meeting, utilities, accounting, consulting, and legal services. General and administrative expenses were $488,564 for the six months ended December 31, 2024, compared to $242,888 for the six months ended December 31, 2023, an increase of $245,676 or 101.15%. The increase of G&A expenses mainly reflected increased payroll expenses of approximately $31,147 and increased professional fees of approximately $197,462.

Current wording

General and administrative expenses consisted mainly of employee salaries and welfare, and expenses for business meetings, utilities, accounting, consulting, and legal services. General and administrative expenses were $603,950 for the nine months ended March 31, 2025, compared to $647,429 for the nine months ended March 31, 2024, a decrease of $43,479 or 6.72%. The decrease of G&A expenses mainly reflected decreased commission expense of approximately $318,007, which was partly offset by increased professional fee by $210,968, increased payroll expense by $47,358, increased OTC Listing fee by $5,450, and increased subcontract labor expense by $4,076.

Previous wording

In addition, during the six months ended December 31, 2024, the Company recorded $805,000 stock compensation expense in respect of the 700,000 shares issued to Mr. Shang Chiai Kung and newly appointed directors as described above.

Current wording

In addition, during the nine months ended March 31, 2025, the Company recorded $1,288,000 stock compensation expense in respect of the 700,000 shares issued to Mr. Shang Chiai Kung and newly appointed directors as described above.

Previous wording

During the six months ended December 31, 2024, the Company recorded $34,167 stock compensation expense for the services of Mr. Hong Hsin Lai’s as described above.

Current wording

During the nine months ended March 31, 2025, the Company recorded $59,792 stock compensation expense for the services of Mr. Hong Hsin Lai’s as described above.

Previous wording

During the six months ended December 31, 2024, the Company recorded $8,200 stock compensation expense in respect of the engagement agreement with an IR firm described above.

Current wording

During the nine months ended March 31, 2025, the Company recorded $8,200 stock compensation expense in respect of the engagement agreement with an IR firm described above.

Previous wording

Net other expenses were $126,183 for the six months ended December 31, 2024, and $20,872 for the six months ended December 31, 2023. For the six months ended December 31, 2024, net other expenses mainly consisted of interest expense of $15,274, and other expenses of $110,909. For the period ended December 31, 2023, net other expenses mainly consisted of interest expense of $11,345 and other expenses of $9,527.

Current wording

Net other expenses were $132,312 for the nine months ended March 31, 2025, and $26,880 for the nine months ended March 31, 2024. For the nine months ended March 31, 2025, net other expenses mainly consisted of interest expense of $22,091, and other expenses of $110,221 which mainly consisted of penalty from cancellation of the purchase contract with Weiguan Ship. For the period ended March 31, 2024, net other expenses mainly consisted of interest expense of $17,353 and other expenses of $9,527.

Previous wording

We had a net loss from continuing operations of $1,547,193 for the six months ended December 31, 2024, compared to a net loss of $53,077 for the six months ended December 31, 2023, an increase in our loss of $1,494,116. The increase in our net loss from continuing operations was mainly due to the decrease in our revenue and increased G&A expenses and stock compensation expenses as described above.

Current wording

We had a net loss of $2,498,000 for the nine months ended March 31, 2025, compared to a net income of $557,088 for the nine months ended March 31, 2024, a decrease in our income of $3,055,088. The decrease in our net income from continuing operations was mainly due to the decrease in our revenue and increased stock compensation expenses as described above.

Previous wording

We had $53,616 cash and cash equivalents, and working capital of $3,179,136 as of December 31, 2024, and generated a net loss of $1,547,193 during the six months ended December 31, 2024. Of the assets included in working capital, approximately $2.5 million was amounts due from related parties, and prepayment to related parties of $1.5 million. The following is a summary of cash provided by or used in each of the indicated types of activities during the six months ended December 31, 2024 and 2023.

Current wording

We had $61,623 cash and cash equivalents, and working capital of $2.55 million as of March 31, 2025, and generated a net loss of $2.5 million during the nine months ended March 31, 2025. Of the assets included in working capital, approximately $2.5 million was amounts due from related parties, and prepayment to related parties of $1.5 million. The following is a summary of cash provided by or used in each of the indicated types of activities during the nine months ended March 31, 2025 and 2024.

Previous wording

Net cash used in operating activities was $443,287 for the six months ended December 31, 2024, compared to net cash used in operating activities of $235,490 for the six months ended December 31, 2023. The increase in the use of cash in operating activities was principally attributable to 1) the increase in our loss (after adjustments to reconcile net income (loss) to net cash used in operating activities) by $646,774, 2) decreased cash inflow from inventory of $807,653, 3) increased cash outflow from accounts payable and accounts payable to related party by $1,324,361, which was partly offset by 1) increased cash inflow from accounts receivable and accounts receivable from related party by $1,415,801, 2) increased cash inflow from note receivable by $160,391, 3) increased cash inflow from deposits and prepayments by $115,231, and 4) increased cash inflow from deferred revenue by $816,496.

Current wording

Net cash used in operating activities was $511,134 for the nine months ended March 31, 2025, compared to net cash used in operating activities of $307,795 for the nine months ended March 31, 2024. The increase in the use of cash in operating activities was principally attributable to 1) the increase in our loss (after adjustments to reconcile net income (loss) to net cash used in operating activities) by $1,378,486, 2) decreased cash inflow from inventory of $810,288, 3) decreased cash inflow from tax payables by $161,764, 4) increased cash outflow from accounts payable and accounts payable to related party by $1,320,793, 5) increased cash outflow from deposit and prepayments and deposit and prepayments to related party by $552,792, which was partly offset by 1) increased cash inflow from accounts receivable and accounts receivable from related party by $1,716,261, 2) increased cash inflow from note receivable by $48,692, 3) increased cash inflow from accrued liabilities and other payables by $41,514, 4) increased cash inflow from deferred revenue by $2,209,138, and 5) decreased cash outflow on other receivables by $5,179.

Previous wording

There was no cash provided by or used in investing activities for the six months ended December 31, 2024 and 2023.

Current wording

There was no cash provided by or used in investing activities for the nine months ended March 31, 2025 and 2024.

Previous wording

Net cash provided by financing activities was $186,263 for the six months ended December 31, 2024, compared to net cash used in financing activities of $571,263 for the six months ended December 31, 2023. Net cash provided by financing activities for the six months ended December 31, 2024, consisted of proceeds from related party advances of $512,630 and proceeds from a loan from a third party of $92,845, which was partly offset by repayments to related parties of $279,944 and repayment of loans of $139,268. Net cash used in financing activities for the six months ended December 31, 2023, consisted of repayments to related parties of $572,383, which was partly offset by receipts from related parties of $1,120.

Current wording

Net cash provided by financing activities was $262,129 for the nine months ended March 31, 2025, compared to net cash used in financing activities of $525,993 for the nine months ended March 31, 2024. Net cash provided by financing activities for the nine months ended March 31, 2025, consisted of proceeds from related party advances of $556,048 and loan proceeds from a third party of $123,073, which was partly offset by repayments to related parties of $278,535 and repayment of loans of $138,457. Net cash used in financing activities for the nine months ended March 31, 2024, consisted of repayments to related parties of $734,075, which was partly offset by receipts from related parties of $208,082.

Previous wording

We had $53,616 of cash and cash equivalents and working capital of approximately $3.2 million as of December 31, 2024, which included amounts due from related parties of $2.5 million, deposit and prepayments to related parties of $1.5 million and due to related parties of $0.4 million. We generated a net loss of $1.0 million during the six months ended December 31, 2024, and we had an accumulated deficit of approximately $3.8 million as of December 31, 2024, and generated negative cash flow from operating activities during the period of $0.4 million. We do not have sustained and stable income, and there is also significant uncertainty in regarding its income for the next 12 months.

Current wording

We had $61,623 of cash and cash equivalents and working capital of approximately $2.55 million as of March 31, 2025, which included amounts due from related parties of $2.5 million, deposit and prepayments to related parties of $1.48 million and due to related parties of $0.41 million. We generated a net loss of $2.50 million during the nine months ended March 31, 2025, and we had an accumulated deficit of approximately $4.8 million as of March 31, 2025, and generated negative cash flow from operating activities during the period of $0.51 million. We do not have sustained and stable income, and there is also significant uncertainty in regarding its income for the next 12 months.

Previous wording

As of the date of this Quarterly Report, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

Current wording

As of the date of this report, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

Previous wording

On January1, 2023, the Company adopted Accounting Standards Update 2016-13 “Financial Instruments — Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments,” which replaces the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss (“CECL”) methodology. The adoption of the credit loss accounting standard has no material impact on the Company’s unaudited condensed consolidated financial statements as of January 1, 2023.

Current wording

On January 1, 2023, the Company adopted Accounting Standards Update 2016-13 “Financial Instruments — Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments,” which replaces the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss (“CECL”) methodology. The adoption of the credit loss accounting standard has no material impact on the Company’s unaudited condensed consolidated financial statements as of January 1, 2023.