Core Viewpoint - The collaboration between Hong Kong University of Science and Technology (HKUST) and Alpha Technology Group Limited (ATGL) aims to establish the "AIphaMind Lab" to develop the "Alpha Engine," an AI training engine that seeks to reduce reliance on large datasets and manual labeling, promoting the democratization of AI technology [1][5]. Group 1: Partnership and Objectives - The signing ceremony was co-hosted by HKUST's Vice President and ATGL's Executive Director, highlighting the collaboration between academia and industry to drive innovation in AI foundational technologies [2][3]. - The core goal of the Alpha Engine is to significantly reduce the time and cost associated with high-quality data collection and manual labeling, aiming to compress the development time for custom AI models from 6-9 months to as little as 3 hours [5][9]. Group 2: Industry Impact and Vision - ATGL has been focusing on customized applications of large language models (LLM) since 2017, successfully competing against major international tech companies in various government and enterprise projects [5]. - The successful development of the Alpha Engine could transform customized AI from a luxury to a necessity, enabling small and medium-sized enterprises (SMEs) to compete more effectively by overcoming data resource limitations [5][9]. - If the Alpha Engine meets its objectives, it is expected to enhance AI development efficiency by over 100 times, allowing sensitive industries like healthcare and manufacturing to deploy models quickly while enabling resource-constrained SMEs to optimize operations at lower costs [9]. Group 3: Future Plans and Educational Support - ATGL plans to establish a fund to support ongoing collaborations with local universities in AI and to assist Hong Kong's primary and secondary school teachers in enhancing their AI application skills, thereby accelerating AI education development in the region [7].

Core Viewpoint - AB DAO has announced a strategic partnership with Alpha Technology Group Limited to enhance the application of AI and blockchain technology in supply chain management, enterprise operations, and IoT [1][4]. Company Overview - Alpha Technology Group Limited (ATGL), listed on Nasdaq in 2023, focuses on AI technology development, providing intelligent automation solutions through AI-powered ERP systems that improve corporate management efficiency [2]. - AB DAO is a leading provider of AI-driven blockchain infrastructure, having developed the AB IoT network to integrate blockchain and IoT technologies, with mature prototypes like smart energy meters and secure storage solutions [3]. Partnership Details - The partnership aims to leverage the complementary strengths of both companies to advance AI and blockchain integration in logistics, supply chain, and enterprise management, focusing on delivering efficient and secure industry solutions [4]. Ecosystem Expansion - AB DAO is expanding its ecosystem by listing its token $AB on multiple exchanges, including Bitget, HTX, and MEXC, with plans for further listings to accelerate global adoption [4]. - The goal of AB DAO is to reach 100 million $AB holders, indicating a strong focus on community growth and engagement [5].

Company Classification and Governance - The company is classified as an "emerging growth company" until it meets certain thresholds, including a market value of Class A Ordinary Shares exceeding $700 million or total annual gross revenues of $1.235 billion[166]. - The company currently relies on exemptions from certain corporate governance requirements due to being a "controlled company," with Mr. Tsang Chun Ho Anthony holding approximately 62.14% voting rights[168]. - The company does not maintain a directors' and officers' insurance policy, which may complicate future insurance procurement and increase costs[167]. Regulatory Environment and Compliance Risks - The company operates in Hong Kong and is not currently regulated by Mainland China laws, but there are uncertainties regarding potential future regulatory impacts from the PRC government[180]. - The company faces risks related to evolving Mainland China laws that could affect its operations and the value of its Class A Ordinary Shares[184]. - Compliance with Mainland China laws may result in increased operational costs and management burdens, potentially impacting business practices[186]. - The company may encounter significant legal and operational risks if the PRC government extends its oversight to Hong Kong-based issuers[187]. - The company provides cloud-based IT solutions, which are subject to recent PRC government regulatory developments concerning data and cybersecurity[188]. - The enactment of the Personal Information Protection Law in China may not apply to the company's Hong Kong subsidiaries, as they only provide services in Hong Kong[189]. - There is significant uncertainty regarding the interpretation and enforcement of PRC laws related to cybersecurity and data privacy, which could disrupt operations and negatively impact financial resources[190]. - The CSRC's Trial Administrative Measures for overseas securities offerings require domestic companies to fulfill filing procedures, creating uncertainty for the company's Hong Kong subsidiaries regarding compliance[191]. - The Hong Kong legal system's uncertainties may limit legal protections available to the company's subsidiaries, affecting the enforcement of contractual rights[192]. - Political risks in Hong Kong, including social unrest and changes in legal frameworks, could adversely affect the company's business operations and financial conditions[201]. - The ongoing protests in Hong Kong, triggered by proposed extradition legislation, have negatively impacted various sectors, including airline, retail, and real estate[202]. - The U.S. government's removal of Hong Kong's preferential trade status may lead to increased tariffs and trade restrictions, potentially harming the company's business[203]. - The Hong Kong National Security Law could materially affect the operations and financial position of the company's subsidiaries if deemed in violation[197]. - The enforcement of PRC laws can change rapidly, which may result in significant impacts on the company's operations and the value of its securities[198]. - The inability of overseas regulators to conduct investigations directly in the PRC may complicate legal processes and shareholder claims[193]. Financial Performance and Market Risks - The company's revenue is vulnerable to social, economic, and political instability in Hong Kong, which could adversely affect business operations[205]. - Economic conditions in Hong Kong and Mainland China are sensitive to global economic trends, and a prolonged slowdown could negatively impact customer confidence and business performance[210]. - The U.S. government's revocation of Hong Kong's preferential trade status may lead to adverse effects on the company's operations and market perception[211]. - The dual-class share structure allows Class B shareholders to hold 62.14% of voting rights, potentially limiting the influence of Class A shareholders on corporate matters[215]. - The dual-class structure may hinder the inclusion of Class A Ordinary Shares in major indices, affecting market activity and shareholder value[216]. - The market price of the company's Class A Ordinary Shares may be volatile, influenced by factors such as performance of other Hong Kong and PRC companies[239]. - The company’s controlling shareholder, Mr. Tsang Chun Ho Anthony, owns approximately 2.60% of Class A Ordinary Shares and 100% of Class B Ordinary Shares, representing 62.14% voting rights, which may not align with other shareholders' interests[238]. - The company is subject to less stringent reporting requirements as a foreign private issuer, which may limit the information available to investors compared to U.S. domestic issuers[248]. - The market for the company's Class A Ordinary Shares may be thinly traded, affecting liquidity and the ability to sell shares at desired prices[243]. - The company may face securities litigation due to price volatility, which could divert management's attention and resources[242]. - The company may incur significant costs and management time if required to engage a new audit firm due to PCAOB inspection requirements[235]. - The company may face significant consequences if its Class A Ordinary Shares are delisted, including reduced liquidity and potential declines in share price[254]. - Substantial future sales of Class A Ordinary Shares could lead to a decline in share price due to increased market volatility[261]. Audit and Compliance Issues - The PCAOB's inability to conduct full inspections in Hong Kong could lead to trading prohibitions under the HFCA Act, impacting the company's securities[230]. - The company has engaged Audit Alliance LLP as its current auditor, which is subject to PCAOB inspections, but uncertainties remain regarding compliance with new regulatory frameworks[231]. - The PCAOB Board determined on December 15, 2022, that it could secure complete access to inspect registered public accounting firms in mainland China and Hong Kong[233]. - If the PCAOB is unable to inspect the auditor, it could lead to the delisting of the company's securities from Nasdaq[233]. - The company faces uncertainties regarding potential additional scrutiny and regulatory actions that could adversely affect its market price and lead to delisting[235]. Shareholder and Financial Management - The company has broad discretion in the use of net proceeds from securities offerings, which may not necessarily improve operational results or share price[255]. - The fair value of options granted under the 2024 Equity Incentive Plan will be charged to the company's financial results, potentially affecting profitability[259]. - The company has agreed to a 6-month lockup period for significant shareholders following its initial public offering on October 30, 2023[245]. - As of the date of the annual report, the company has 15,262,500 Class A Ordinary Shares and 1,200,000 Class B Ordinary Shares outstanding, with a maximum of 900,000,000 authorized Class A Ordinary Shares[260]. - For the year ended September 30, 2024, the top three customers accounted for 21.04%, 18.67%, and 12.31% of the company's total revenue, indicating a decrease in concentration compared to previous years[634]. - The consumer price index in China increased by 0.2%, 0.2%, and 2.0% in 2024, 2023, and 2022, respectively, showing minimal impact from inflation on the company's operations[636]. - The company has not used any derivative financial instruments to hedge foreign exchange risk, which may affect the value of investments due to currency fluctuations[632].

Company Overview - Alpha Technology Group Limited (NASDAQ: ATGL) is a cloud-based IT solution service provider based in Hong Kong, specializing in optimizing business performance through AI technologies and comprehensive solutions [6]. - The company offers a range of services including system development, web and mobile application development, and AI-powered optical character recognition (AI-OCR) services [6][7]. Leadership Recognition - Anthony Tsang, Executive Director and President of Alpha Technology Group, received the 18th World Outstanding Chinese Award on September 8, 2024, recognizing his contributions to finance and AI [1][3]. - Tsang's leadership has been previously acknowledged with awards such as the Forbes Distinguished Leader Award and the World Outstanding Chinese Young Entrepreneur Award in 2022 [3]. Strategic Achievements - Under Tsang's leadership, Alpha Technology Group successfully integrated two Hong Kong-based IT companies, leading to its listing on NASDAQ, marking it as the first AI company from Hong Kong to achieve this milestone [1][2]. - The company has implemented significant reforms that have revitalized its operations and enhanced its presence in the capital market [2]. Vision and Future Direction - Tsang emphasizes the transformative potential of AI, stating that it can change business models and improve people's lives, which aligns with the company's mission to drive innovation [3]. - The company is focused on finding and investing in potential companies that can lead technological change, reflecting a forward-looking approach in the AI sector [3].

Core Viewpoint - Alpha Technology Group Limited reported a significant revenue increase of 96.55% for the fiscal year ended September 30, 2023, driven by growth in system development services, NFT-related services, and technological support [2][5][12]. Financial Highlights - Revenues rose from HK$4.42 million (approximately US$0.55 million) in 2022 to HK$8.69 million (approximately US$1.11 million) in 2023, marking a 96.55% increase [2][5]. - Gross profit increased by HK$1.85 million (approximately US$0.24 million), or 183.99%, from HK$1.00 million in 2022 to HK$2.85 million (approximately US$0.36 million) in 2023 [2][10]. - Gross profit margin improved from 22.67% in 2022 to 32.75% in 2023, attributed to higher margins from NFT-related services [2][10]. - Cost of revenue increased by 70.92% to HK$5.84 million (approximately US$0.75 million) due to higher staff costs and consultancy fees [2][8]. - Selling, general, and administrative expenses rose by 94.47% to HK$7.23 million (approximately US$0.92 million), driven by increased staff costs and director's remuneration [2][11]. - The net loss for the year increased by 162.33% to HK$6.99 million (approximately US$0.89 million) [2][12]. Revenue Breakdown - Revenue from system development services increased by 65.83% to HK$5.97 million [7]. - Revenue from NFT-related services was HK$1.59 million, a 100% increase as it was not present in the previous year [7]. - Technological support and maintenance services revenue rose by 191.67% to HK$1.05 million [7]. Recent Developments - On November 2, 2023, Alpha completed its initial public offering, raising approximately US$7.00 million from the sale of 1,750,000 Ordinary Shares at US$4 per share, with net proceeds totaling around US$5.32 million after expenses [13].

Company Classification and Compliance - The company is classified as an "emerging growth company" and will benefit from reduced disclosure requirements, which may affect the attractiveness of its Ordinary Shares to investors [169]. - The company plans to rely on exemptions from certain disclosure requirements, including providing only two years of audited financial statements and reduced executive compensation disclosures [170]. - The company will remain an emerging growth company until its market value exceeds $700 million or total annual gross revenues reach $1.235 billion [172]. - After ceasing to be an emerging growth company, the company expects to incur significant expenses related to compliance with the Sarbanes-Oxley Act and public company reporting obligations [173]. - The company does not currently intend to rely on "controlled company" exemptions but may choose to do so in the future, potentially affecting board independence [175]. - The company is exempt from certain SEC reporting requirements as a foreign private issuer, which may affect the information available to investors [258]. - If the company loses its foreign private issuer status, it would incur significant additional regulatory costs and obligations [260]. - The company must comply with Nasdaq listing requirements to avoid delisting, which could negatively impact share price and liquidity [263]. Ownership and Control - As of September 30, 2023, Ms. Ma Xiaoqiu beneficially owned approximately 73.0% of the company's Ordinary Shares, classifying it as a "controlled company" under Nasdaq rules [174]. - Ms. Ma Xiaoqiu owns approximately 63.37% of the voting power, significantly influencing corporate decisions [246]. Regulatory Environment and Risks - The company operates in Hong Kong and does not collect or process personal data from Mainland China, thus avoiding direct regulatory impact from Mainland China laws [187]. - There are uncertainties regarding the potential future application of Mainland China laws to the company's operations in Hong Kong, which could materially affect its business [188]. - Compliance with Mainland China laws could result in increased operational costs and management burdens, potentially harming the company's business [192]. - The company faces uncertainties regarding the need for pre-approval from the PRC government for its U.S. listing and business operations, which could adversely affect its ability to conduct business [193]. - The PRC government may extend oversight over overseas offerings, potentially hindering the ability to offer Ordinary Shares and causing significant declines in share value [194]. - The Personal Information Protection Law, effective November 1, 2021, applies to personal information processing activities outside Mainland China for services offered to domestic individuals, but the company believes it is not subject to this law [196]. - There is significant uncertainty regarding the interpretation and enforcement of PRC laws related to cybersecurity and data privacy, which could disrupt operations and negatively impact financial conditions [198]. - The CSRC's Trial Administrative Measures for overseas securities offerings took effect on March 31, 2023, requiring domestic companies to fulfill filing procedures, adding regulatory uncertainty [199]. - The Hong Kong National Security Law, enacted on June 30, 2020, could materially affect the operations and financial position of the company's Hong Kong subsidiaries [208]. - The enforcement of PRC laws can change rapidly, potentially impacting the company's operations and the value of its securities [210]. - The U.S. government has revoked Hong Kong's preferential trade status, treating it similarly to Mainland China, which may affect the company's operations and market access [224]. - The SEC and PCAOB have implemented stricter criteria for auditing companies with significant operations in the PRC, which could lead to uncertainties regarding the company's compliance and trading status [226]. - The PCAOB has determined it can now inspect registered public accounting firms in Mainland China and Hong Kong, but future obstructions could lead to delisting risks for the company's securities [240]. Financial Performance and Market Conditions - All revenue is derived from operations in Hong Kong, making the company vulnerable to adverse political and economic conditions in the region [213]. - Ongoing protests in Hong Kong have adversely affected various sectors, including airline, retail, and real estate, leading to declines in sales [214]. - The company is susceptible to ongoing incidents affecting the stability of social, economic, and political conditions in Hong Kong, which may adversely impact business operations [217]. - Economic conditions in Hong Kong and Mainland China are sensitive to global economic conditions, and a prolonged slowdown may negatively impact customer confidence and business performance [223]. - The company relies on dividend payments from its Hong Kong Operating Subsidiaries to fund cash and financing requirements, with no current restrictions on converting Hong Kong dollars into foreign currencies [219]. - The PRC government's control over foreign currency conversion may limit the company's foreign exchange transactions, including future dividend payments [218]. - Changes in the exchange rate between the Hong Kong dollar and U.S. dollar may materially affect the company's financial condition and cash flows [265]. Share Price and Market Risks - The market price of the company's ordinary shares could be adversely affected by regulatory changes and uncertainties related to audit inspections and compliance [242]. - The market price of the Ordinary Shares is expected to be volatile, influenced by factors such as financial projections and negative publicity [247]. - The company may face significant legal expenses and management distraction if involved in securities litigation due to share price volatility [250]. - The Ordinary Shares may be thinly traded, leading to potential difficulties in selling shares at desired prices [251]. - Substantial sales of Ordinary Shares in the public market could adversely affect the market price and the company's ability to raise capital [253]. - The company is subject to lock-up restrictions for 6 months post-IPO, limiting the sale of shares by significant shareholders [254]. - Substantial future sales of Ordinary Shares could cause the market price to decline, with three existing shareholders having registered an aggregate of 2,000,000 shares for resale [274]. Future Plans and Shareholder Considerations - The company has a maximum of 1,500,000,000 authorized Ordinary Shares, with only 15,262,500 shares outstanding as of the date of the annual report [272]. - The 2024 Equity Incentive Plan, if approved, may reserve and grant a maximum of 15,000,000 Ordinary Shares, potentially diluting existing shareholders [270]. - The company may face potential shareholder dilution from future equity incentive plans and share issuances [270]. - The company has not used any derivative financial instruments to hedge foreign exchange risk, which may affect the value of investments due to currency fluctuations [578]. - The company has not used any derivative financial instruments to manage interest rate risk exposure, which is considered not material [582]. - The company may become a passive foreign investment company (PFIC), which could result in adverse U.S. tax consequences for U.S. investors [268]. Customer Concentration - For the year ended September 30, 2023, Customer B, Customer A, and Customer D accounted for 35.01%, 32.50%, and 16.23% of the Company's total revenue, respectively [581].