Core Insights - HeartCore Enterprises, Inc. (HTCR) reported a quarterly loss of $0.08 per share, missing the Zacks Consensus Estimate of $0.02, and a significant decline from earnings of $0.53 per share a year ago, resulting in an earnings surprise of -500.00% [1] - The company generated revenues of $7.05 million for the quarter ended September 2025, exceeding the Zacks Consensus Estimate by 19.34%, but down from $17.85 million in the same quarter last year [2] - HeartCore Enterprises has underperformed the market, with shares down approximately 66.1% year-to-date, contrasting with the S&P 500's gain of 13.4% [3] Earnings Outlook - The earnings outlook for HeartCore Enterprises is mixed, with the current consensus EPS estimate for the upcoming quarter at -$0.01 on revenues of $4.73 million, and -$0.07 on revenues of $18.97 million for the current fiscal year [7] - The company's Zacks Rank is currently 3 (Hold), indicating expected performance in line with the market in the near future [6] Industry Context - The Internet - Software and Services industry, to which HeartCore Enterprises belongs, is currently ranked in the top 23% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8]

Financial Performance - For the three months ended September 30, 2025, the company generated revenues of $2,990,329, a decrease of 81.6% compared to $16,240,865 for the same period in 2024[155]. - For the nine months ended September 30, 2025, the company reported revenues of $7,052,799, down 66.9% from $21,270,891 in 2024[156]. - The net loss from continuing operations for the three months ended September 30, 2025, was $137,122, compared to a net income of $11,119,592 for the same period in 2024[155]. - The net loss from continuing operations for the nine months ended September 30, 2025, was $2,913,181, contrasting with a net income of $6,705,342 in 2024[156]. - Total revenues decreased by $13,250,536, or 81.6%, to $2,990,329 for the three months ended September 30, 2025, compared to $16,240,865 for the same period in 2024[159]. - Total revenues decreased by $14,218,092, or 66.8%, to $7,052,799 for the nine months ended September 30, 2025, from $21,270,891 for the same period in 2024[181]. - Net income attributable to HeartCore Enterprises, Inc. was $434,072 for the three months ended September 30, 2025, a decrease of $10,623,734, or 96.1%, from $11,057,806 in the same period in 2024[176]. - Net income (loss) attributable to HeartCore Enterprises, Inc. common shareholders was a loss of $1,609,851 for the nine months ended September 30, 2025, representing a decrease of $9,383,207, or 120.7%, from a net income of $7,773,356 for the same period in 2024[201]. Expenses - Gross profit decreased by $12,541,707, or 89.5%, to $1,468,409 for the three months ended September 30, 2025, from $14,010,116 in the prior year[161]. - Gross profit decreased by $12,462,942, or 82.7%, to $2,599,064 for the nine months ended September 30, 2025, compared to $15,062,006 for the same period in 2024[184]. - Selling expenses decreased by $67,654, or 41.7%, to $94,718 for the three months ended September 30, 2025, from $162,372 in the prior year[163]. - Selling expenses decreased by $180,012, or 34.7%, to $338,615 for the nine months ended September 30, 2025, from $518,627 for the same period in 2024[186]. - General and administrative expenses decreased by $58,176, or 4.0%, to $1,384,838 for the three months ended September 30, 2025, from $1,443,014 in the same period in 2024[166]. - General and administrative expenses decreased by $682,679, or 14.2%, to $4,119,851 for the nine months ended September 30, 2025, from $4,802,530 for the same period in 2024[188]. - Research and development expenses decreased by $63,709, or 100.0%, to nil for the three months ended September 30, 2025, from $63,709 in the prior year[168]. - Research and development expenses decreased by 100.0% to nil for the nine months ended September 30, 2025, from $172,140 for the same period in 2024[190]. Cash Flow and Financial Position - Total cash and cash equivalents decreased to $2,024,736 as of September 30, 2025, from $2,121,089 at the beginning of the period[202]. - Net cash flows used in operating activities of continuing operations was $2,980,958 for the nine months ended September 30, 2025[203]. - Net cash flows used in operating activities of continuing operations amounted to $3,027,115 for the nine months ended September 30, 2024[204]. - Net cash flows provided by financing activities of continuing operations totaled $1,953,032 for the nine months ended September 30, 2025, mainly from the issuance of Series A convertible preferred shares[206]. - Future minimum principal payments for long-term debts total $510,912 as of September 30, 2025[212]. - Net cash flows used in discontinued operations were $166,736 and $1,080,748 for the nine months ended September 30, 2025 and 2024, respectively[208]. Corporate Actions and Compliance - The company has entered into consulting agreements with 16 companies for their IPO process, with consulting fees ranging from $380,000 to $900,000 per company[135]. - The company sold its software business assets in Japan for a purchase price of ¥1,800,418,650 (approximately $12 million) to Smith Japan Holdings KK[144]. - A one-time distribution of $0.13 per share to stockholders has been authorized, with a record date of November 10, 2025[149]. - The company is currently not in compliance with Nasdaq's minimum bid price requirement of $1.00 per share, with a 180-day period granted to regain compliance[150][151]. - As of September 30, 2025, the company had an accumulated deficit of $17,797,861[156]. - HeartCore Financial, Inc. was formed as a wholly owned subsidiary to support the GO IPO consulting business, and HeartCore Luvina Vietnam Company was established as a 51% owned subsidiary in Vietnam[141]. Investment and Market Activity - Income from discontinued operations, net of income tax, was $488,297 for the three months ended September 30, 2025, a $790,959, or 261.3%, increase from a loss of $302,662 in the prior year[173]. - Income from discontinued operations, net of income tax, increased by $766,013, or 181.3%, to $1,188,481 for the nine months ended September 30, 2025, from $422,468 for the same period in 2024[196]. - A gain of $1,631,700 was recognized on fair value changes in investments in warrants[210]. - The company recognized a loss of $3,970,628 on the sale of warrants to a third party[210]. - Marketable securities and warrants received as noncash consideration totaled $13,541,693 during the period[210]. - The company had no off-balance sheet arrangements as of September 30, 2025[213].

Financial Performance - Revenues for Q3 2025 were $3.0 million, a decrease of 81.5% from $16.2 million in Q3 2024, primarily due to the absence of significant warrant revenue from a large GO IPO deal[5] - Gross profit for Q3 2025 was $1.5 million, down 89.3% from $14.0 million in the same period last year, reflecting reduced gross profit from GO IPO services[5] - Net income for Q3 2025 was $0.4 million, a significant decline from $10.8 million in Q3 2024[8] - Adjusted EBITDA for Q3 2025 was $0.5 million, down from $12.0 million in Q3 2024[9] - For the nine months ended September 30, 2025, revenues were $7.1 million, a decrease of 66.7% from $21.3 million in the same period last year[10] - Gross profit for the nine months ended September 30, 2025, was $2,599,064, down from $15,062,006 in 2024, indicating a decrease of about 82.7%[24] - Net loss attributable to HeartCore Enterprises, Inc. for the nine months ended September 30, 2025, was $(1,609,851), compared to a net income of $7,773,356 in 2024, reflecting a significant shift in performance[24] - Basic and diluted net income (loss) per common share for the nine months ended September 30, 2025, was $(0.07), down from $0.37 in 2024[25] - Income (loss) from continuing operations before income tax expense for the nine months ended September 30, 2025, was $(2,858,295), compared to $6,805,817 in 2024[24] - Other comprehensive loss for the nine months ended September 30, 2025, was $(1,715,032), compared to a comprehensive income of $7,179,488 in 2024[24] - For the nine months ended September 30, 2025, the net loss from continuing operations was $2,913,181 compared to a net income of $6,705,342 in the same period of 2024[27] Operating Expenses - Operating expenses decreased to $1.5 million in Q3 2025, compared to $1.7 million in Q3 2024, due to various cost-cutting measures[7] - Operating expenses for the nine months ended September 30, 2025, decreased to $4.5 million from $5.5 million in the same period last year, driven by reductions in general and administrative costs[11] - Total operating expenses for the nine months ended September 30, 2025, were $4,458,466, a decrease from $5,493,297 in 2024, showing a reduction of approximately 18.8%[24] Cash and Cash Equivalents - Cash and cash equivalents as of September 30, 2025, were $1.5 million, down from $2.0 million at the end of 2024[9] - The cash and cash equivalents at the end of the period were $2,024,736, down from $2,121,089 at the beginning of the period[28] Strategic Changes - The company divested its software business subsidiary, HeartCore Japan, to focus on its Go IPO business, which is expected to enhance long-term profitability[3] - The company signed its 16th Go IPO client and successfully launched one client on the Nasdaq Stock Market[6] Cash Flows - Cash flows from operating activities of continuing operations resulted in a net cash outflow of $2,980,958 for 2025, compared to an outflow of $3,027,115 in 2024[27] - The company reported net proceeds from the sale of warrants amounting to $5,640,000 in 2025[27] - The net cash flows used in financing activities of continuing operations were $1,953,032 in 2025, compared to $(1,168,769) in 2024[28] Depreciation and Amortization - The company incurred depreciation and amortization expenses of $36,994 for the nine months ended September 30, 2025, compared to $532,958 in 2024[27] Other Financial Metrics - The company reported a loss on sale of warrants amounting to $(3,970,628) during the nine months ended September 30, 2024[24] - The company reported a gain on the termination of lease amounting to $(9,059) in 2025[27] - The company reported a loss on disposal of property and equipment of $116,981 for the nine months ended September 30, 2025[27] - Research and development expenses for the nine months ended September 30, 2025, were not reported, while they were $172,140 in 2024, indicating a potential shift in focus or strategy[24]

Core Insights - HeartCore Enterprises, Inc. has made a strategic decision to divest its software business subsidiary, HeartCore Japan, to focus on its Go IPO consulting services, which is expected to enhance long-term profitability and operational efficiency [2][3] Financial Performance - For Q3 2025, revenues decreased to $3.0 million from $16.2 million in Q3 2024, primarily due to the absence of significant warrant revenue from a large Go IPO deal in the prior year [4] - Gross profit for Q3 2025 was $1.5 million, down from $14.0 million in the same period last year, reflecting reduced profitability from Go IPO services [4] - Operating expenses decreased to $1.5 million from $1.7 million year-over-year, attributed to cost-cutting measures [5] - Net income for Q3 2025 was $0.4 million, a significant decline from $10.8 million in Q3 2024, while adjusted EBITDA fell to $0.5 million from $12.0 million [5][4] Nine-Month Financial Results - For the nine months ended September 30, 2025, revenues were $7.1 million, down from $21.3 million in the same period last year, again due to the lack of comparable warrant revenue [7] - Gross profit for the nine months was $2.6 million, compared to $15.1 million in the previous year [7] - Operating expenses for the nine months decreased to $4.5 million from $5.5 million, reflecting ongoing cost management efforts [8] - The company reported a net loss of $1.7 million for the nine months, compared to a net income of $7.1 million in the same period last year [9] Cash Position - As of September 30, 2025, cash and cash equivalents stood at $1.5 million, down from $2.0 million at the end of 2024 [6] - On a pro forma basis, following a one-time distribution payment to stockholders, cash and cash equivalents increased to approximately $2.5 million as of November 18, 2025 [6] Client Engagement and Market Outlook - The company signed its 16th Go IPO client and successfully facilitated one client to begin trading, with expectations for another client to commence trading soon [3] - Demand for Go IPO services remains strong in Japan, and discussions with prospective clients in Korea are ongoing, indicating potential for future growth in the IPO consulting space [3]

Core Points - HeartCore Enterprises, Inc. has received a 180-day extension from Nasdaq to comply with the $1.00 minimum bid price requirement [1][2] - The company must meet the minimum bid price requirement by May 1, 2026, and if the closing bid price is at least $1.00 for 10 consecutive business days, compliance will be confirmed [2] - There is no guarantee that HeartCore will regain compliance with the minimum bid price requirement despite meeting other listing criteria [3] Company Overview - HeartCore is a Tokyo-based IPO consulting services company that assists Japanese growth companies in achieving successful U.S. exchange listings through its Go IPO service [4] - The Go IPO consulting services include pre-IPO consulting, regulatory guidance, financial preparation, and operational readiness to facilitate a smooth transition into U.S. public markets [4]

Core Insights - HeartCore Enterprises, Inc. has sold its subsidiary HeartCore Japan to Volaris Group for approximately ¥1.8 billion (around USD $12 million) in an all-cash deal [1] - The decision to divest the software business is driven by the rapid evolution of generative AI, which has changed the competitive landscape for traditional software businesses [2] - The company aims to focus on its Go IPO consulting business, which is expected to drive sustainable long-term value for shareholders despite a reduction in near-term revenue from the divestiture [3] Financial Implications - A one-time distribution payment of $0.13 per share will be made to shareholders, representing approximately 17.2% of the company's stock price as of October 29, 2025 [4] - Proceeds from the sale of HeartCore Japan will be partially used to fund this distribution [4] Strategic Focus - The Tokyo Stock Exchange's new minimum market capitalization requirement for Growth Market companies is expected to create a favorable environment for HeartCore's Go IPO business, as companies will seek alternative strategies for greater liquidity and visibility [5] - The company is committed to organic growth in Japan and Korea, with plans to build a pipeline of clients benefiting from its Go IPO services [6]

Core Insights - HeartCore Enterprises, Inc. has authorized a one-time payment of $0.13 per share to its stockholders, which will be classified as a distribution for U.S. federal tax purposes rather than a dividend [1] - The record date for stockholders to participate in this distribution is November 10, 2025, with the payment date set for November 17, 2025 [2] - The distribution payment of $0.13 per share represents approximately 16.8% of the company's stock price as of October 27, 2025 [2] Company Overview - HeartCore Enterprises, Inc. is headquartered in Tokyo, Japan, with additional offices in New York and San Francisco, CA, and specializes in enterprise software and consulting services [3] - The company offers Software as a Service (SaaS) solutions and data analytics services aimed at enhancing customer experiences for enterprise clients [3][4] - HeartCore's customer experience management platform includes various systems for marketing, sales, service, and content management, along with tools for digital transformation such as robotics process automation [4] Consulting Services - HeartCore provides a Go IPOSM consulting service that assists Japanese-based companies in going public in the U.S. [5]

Core Insights - HeartCore Enterprises, Inc. has authorized a one-time dividend payment of $0.13 per share, representing approximately 17.8% of the stock price as of October 17, 2025 [1][2] - The record date for the dividend is set for November 10, 2025, with the payment date on November 17, 2025 [2] - Future dividends may be issued quarterly, subject to Board approval based on the Company's financial results [2] Company Overview - HeartCore is headquartered in Tokyo, Japan, with additional offices in New York and San Francisco, CA [3] - The Company specializes in enterprise software and consulting services, offering Software as a Service (SaaS) solutions and data analytics services [3] - HeartCore's customer experience management platform includes various tools for marketing, sales, service, and content management [4] Services Offered - The Company provides a digital transformation business that includes robotics process automation, process mining, and task mining [4] - HeartCore's Go IPOSM consulting service assists Japanese companies in going public in the U.S. [5]

Core Insights - HeartCore Enterprises, Inc. is set to launch HeartCore CMS Version 13 on September 30, 2025, which integrates user-friendly design with advanced AI-driven marketing features [1][2] Product Features - The new CMS version emphasizes intuitive usability and powerful AI capabilities aimed at enhancing digital marketing effectiveness [2] - Key features include generative AI for SEO/GEO, an AI-powered recommendation engine, a redesigned user interface, and an enhanced management screen builder [7][8] Business Model and Strategy - HeartCore CMS V13 will be offered under a Software-as-a-Service (SaaS) model, with subscription pricing expected to increase by approximately 1.5 times to support revenue growth [4] - The company aims to migrate 50% of 60 targeted existing customers to the SaaS model, which will also lead to a 1.5 times increase in total maintenance fees for these companies [5] Market Positioning - The CMS is positioned to address the unmet demand for AI-driven content management solutions in Japan, particularly as traditional CMS platforms struggle to adapt to new market needs [2][6] - HeartCore's focus on deeper personalization and advanced AI capabilities aims to improve customer segmentation and content delivery [6]

Core Viewpoint - Momentum investing focuses on "buying high and selling higher" rather than traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Characteristics - Momentum investing can be risky as stocks may lose momentum when their valuations exceed future growth potential [2] - A safer approach involves investing in bargain stocks that exhibit recent price momentum, identified through the Zacks Momentum Style Score [3] Group 2: HeartCore Enterprises, Inc. (HTCR) Analysis - HTCR has shown a significant price increase of 86.5% over the past four weeks, indicating strong investor interest [4] - Over the past 12 weeks, HTCR's stock gained 77.9%, demonstrating its ability to deliver positive returns over a longer timeframe [5] - HTCR has a beta of 2.01, suggesting it moves 101% higher than the market in either direction, indicating fast-paced momentum [5] - HTCR has a Momentum Score of A, suggesting it is an opportune time to invest in the stock [6] - The stock has a Zacks Rank 1 (Strong Buy) due to upward trends in earnings estimate revisions, which attract more investors [7] - HTCR is trading at a Price-to-Sales ratio of 0.70, indicating it is reasonably valued at 70 cents for each dollar of sales [7] Group 3: Additional Investment Opportunities - Besides HTCR, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, presenting further investment opportunities [8] - Investors can explore over 45 Zacks Premium Screens tailored to different investing styles to identify potential winning stocks [9]