[Part I. FINANCIAL INFORMATION](index=6&type=section&id=Part%20I.%20FINANCIAL%20INFORMATION) Comprehensive financial data including statements, management analysis, and internal controls [Financial Statements](index=6&type=section&id=Item%201.%20Financial%20Statements) The company's Q2 2025 financial statements reflect decreased assets, a **$0.4 million** net income turnaround, and negative operating cash flow due to a special dividend payment [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) A summary of the company's financial position, highlighting changes in assets, liabilities, and equity - Total assets decreased by **$10.2 million** from December 31, 2024, to June 30, 2025, mainly driven by a **$9.5 million** decrease in cash and cash equivalents. Total equity also decreased by **$11.0 million**, reflecting the net loss and dividend payments during the period[18](index=18&type=chunk)[19](index=19&type=chunk) Condensed Consolidated Balance Sheet Summary (in thousands) | Balance Sheet Item | Dec 31, 2024 | June 30, 2025 | Change | | :--- | :--- | :--- | :--- | | **Total Current Assets** | $43,942 | $30,540 | ($13,402) | | Cash and cash equivalents | $26,642 | $17,121 | ($9,521) | | **Total Assets** | **$69,468** | **$59,255** | **($10,213)** | | **Total Current Liabilities** | $23,590 | $23,460 | ($130) | | **Total Liabilities** | **$24,707** | **$25,483** | **$776** | | **Total Equity** | **$44,761** | **$33,772** | **($10,989)** | [Condensed Consolidated Statements of Operations](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Overview of revenue, gross profit, and net income trends for the quarter and six-month periods Key Operational Metrics (in thousands, except EPS) | Metric | Q2 2024 | Q2 2025 | YoY Change | H1 2024 | H1 2025 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Total Revenues** | $15,289 | $19,276 | +26.1% | $29,312 | $37,276 | +27.2% | | SaaS revenue | $15,249 | $19,237 | +26.1% | $29,231 | $37,195 | +27.2% | | **Gross Profit** | $11,789 | $14,293 | +21.2% | $22,496 | $27,707 | +23.2% | | **(Loss) Income from Operations** | ($788) | $446 | Turnaround | ($2,220) | ($528) | Improvement | | **Net (Loss) Income** | ($492) | $435 | Turnaround | ($3,622) | ($659) | Improvement | | **Diluted EPS** | ($0.0006) | $0.0006 | Turnaround | ($0.005) | ($0.0004) | Improvement | [Condensed Consolidated Statements of Cash Flows](index=12&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Analysis of cash inflows and outflows from operating, investing, and financing activities - For the first six months of 2025, the company used **$11.1 million** for a special cash dividend, which was the primary driver for the **$11.2 million** net cash used in financing activities. Net cash from investing activities was positive **$3.8 million** due to the redemption of **$5.0 million** in short-term investments[27](index=27&type=chunk) Cash Flow Summary for the Six Months Ended June 30 (in thousands) | Cash Flow Activity | 2024 | 2025 | Change | | :--- | :--- | :--- | :--- | | Net cash used in operating activities | ($289) | ($2,836) | ($2,547) | | Net cash (used in) provided by investing activities | ($136) | $3,837 | $3,973 | | Net cash provided by (used in) financing activities | $858 | ($11,192) | ($12,050) | | **Net (decrease) in cash** | **$433** | **($10,191)** | **($10,624)** | [Notes to Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Key notes detail business segments, a sales tax liability revision, the TBI acquisition, and significant shareholder activities including an **$11 million** special cash dividend - The company operates two primary SaaS businesses: Lofty, a real estate platform, and Trucker Path, a platform for the trucking industry. The majority of revenue is generated from the U.S. market[29](index=29&type=chunk) - Management discovered that the sales tax liability was understated by **$3.0 million** as of June 30, 2024, with **$2.4 million** related to prior years (2021-2023). The company determined the misstatement was not material but has revised the prior period financial statements[39](index=39&type=chunk)[40](index=40&type=chunk) - On May 1, 2025, the company acquired 100% of Truckers Best Insurance LLC (TBI) to enter the insurance brokerage business. The total purchase consideration was **$2.8 million**, including **$1.0 million** in cash and **$1.8 million** in contingent consideration[79](index=79&type=chunk) - On March 5, 2025, the company's board declared a special cash dividend of **$0.01346** per ordinary share, totaling approximately **$11 million**, which was paid on March 27, 2025[93](index=93&type=chunk) - The company continued its stock repurchase program, buying back **1,235,655** Class A ordinary shares for **$29 thousand** in Q2 2025 and **2,753,055** shares for **$86 thousand** in H1 2025[96](index=96&type=chunk) Segment Revenue for Six Months Ended June 30 (in thousands) | Segment | 2024 | 2025 | YoY Change | | :--- | :--- | :--- | :--- | | Lofty | $16,440 | $19,706 | +19.9% | | Trucker Path | $12,791 | $17,489 | +36.7% | | **Total SaaS Revenue** | **$29,231** | **$37,195** | **+27.2%** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=45&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q2 2025 revenue growth driven by SaaS expansion, gross margin decline, increased operating expenses, and sufficient liquidity [Results of Operations](index=48&type=section&id=Results%20of%20Operations) Analysis of Q2 2025 operational results, highlighting **26.1%** revenue growth, gross margin contraction, and shifts in operating expenses - Q2 2025 revenue increased **26.1%** YoY, primarily from SaaS businesses. Subscription services revenue grew **21.7%**, driven by an expanded Trucker Path subscriber base, which increased **30%** to **144,800** paying subscriptions as of June 30, 2025[150](index=150&type=chunk) - Lofty's purchased seats (eligible users on a paid subscription) increased by **9%** to **85,600** as of June 30, 2025, from **78,500** a year prior, despite a **5%** decrease in the number of paying subscriptions[150](index=150&type=chunk) - Q2 2025 gross margin decreased to **74.1%** from **77.1%** in Q2 2024, attributed to increased costs of service features within the real estate SaaS platform[153](index=153&type=chunk) - Q2 2025 R&D expenses increased **32.6%** YoY to **$6.1 million** due to higher headcount for new projects. Selling and marketing expenses decreased **10.2%** to **$4.4 million**, mainly due to lower sales tax expenses[157](index=157&type=chunk) [Liquidity and Capital Resources](index=54&type=section&id=Liquidity%20and%20Capital%20Resources) Assessment of the company's liquidity, including **$17.1 million** in cash, negative operating cash flow, and future capital sufficiency - The company had cash and cash equivalents of **$17.1 million** as of June 30, 2025, and management expects this to be sufficient to meet operating needs for at least the next twelve months[171](index=171&type=chunk) - Net cash used in operating activities was **$2.8 million** for the first six months of 2025, compared to **$0.3 million** in the same period of 2024[173](index=173&type=chunk) Contractual Obligations as of June 30, 2025 (in thousands) | Obligation | Total | Less than 1 year | 1-3 years | 4-5 years | More than 5 years | | :--- | :--- | :--- | :--- | :--- | :--- | | Operating lease obligations | $1,356 | $322 | $807 | $91 | $136 | | Contingent earn-out consideration | $2,723 | $928 | $1,795 | $— | $— | | **Total** | **$4,079** | **$322** | **$3,530** | **$91** | **$136** | [Quantitative and Qualitative Disclosures About Market Risk](index=58&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, the company is exempt from providing quantitative and qualitative market risk disclosures - As a smaller reporting company, Moatable, Inc. is not required to provide the information specified under this item[187](index=187&type=chunk) [Controls and Procedures](index=58&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls were ineffective due to unremediated material weaknesses, with remediation plans underway - Management concluded that as of June 30, 2025, the company's disclosure controls and procedures were not effective[189](index=189&type=chunk) - Three material weaknesses in internal control remain unremediated as of June 30, 2025: - Lack of a systematic risk assessment process for financial reporting - Lack of evaluation in assessing sales tax applicability, leading to an understated accrual - Lack of evaluations to ensure internal control components are present and functioning[190](index=190&type=chunk)[191](index=191&type=chunk) - Remediation plans include recruiting personnel with U.S. GAAP knowledge, designing an improved control environment, implementing a consolidated general ledger, and engaging experts for sales tax compliance[191](index=191&type=chunk)[192](index=192&type=chunk) [Part II. OTHER INFORMATION](index=61&type=section&id=Part%20II.%20OTHER%20INFORMATION) Additional disclosures covering legal proceedings, risk factors, equity sales, and other relevant corporate information [Legal Proceedings](index=61&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently involved in any material legal proceedings or aware of any significant threatened actions - The company is not currently a party to any material legal proceedings[196](index=196&type=chunk) [Risk Factors](index=61&type=section&id=Item%201A.%20Risk%20Factors) No material changes have occurred to the risk factors previously disclosed in the company's latest annual report - There have been no material changes to the risk factors disclosed in the company's Annual Report on Form 10-K for the fiscal year ended December 31, 2024[197](index=197&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=61&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Details on the continued stock repurchase program, including Q2 2025 repurchases of **27,459 ADSs** for **$29 thousand** Share Repurchases for Q2 2025 | Period | Total ADSs Purchased | Average Price Paid Per ADS | Total Cost (in thousands) | | :--- | :--- | :--- | :--- | | May 2025 | 7,066 | $1.02 | $7 | | June 2025 | 20,393 | $1.06 | $22 | | **Total** | **27,459** | **-** | **$29** | [Other Information](index=61&type=section&id=Item%205.%20Other%20Information) No officers or directors adopted or terminated Rule 10b5-1 trading arrangements during the first six months of 2025 - No officers or directors adopted or terminated any Rule 10b5-1 trading arrangements during the six months ended June 30, 2025[202](index=202&type=chunk)

[Part I. FINANCIAL INFORMATION](index=6&type=section&id=Part%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=6&type=section&id=Item%201.%20Financial%20Statements) Q1 2025 financials show decreased assets from a special dividend, offset by revenue growth and a narrowed net loss [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to **$57.0 million** by March 31, 2025, primarily due to reduced cash and equity Balance Sheet Items (in thousands) | Balance Sheet Items | Dec 31, 2024 (in thousands) | Mar 31, 2025 (in thousands) | | :--- | :--- | :--- | | **Current Assets** | | | | Cash and cash equivalents | $26,642 | $18,773 | | Total current assets | $43,942 | $31,318 | | **Total Assets** | **$69,468** | **$57,001** | | **Current Liabilities** | | | | Total current liabilities | $23,590 | $23,031 | | **Total Liabilities** | **$24,707** | **$24,205** | | **Total Equity** | **$44,761** | **$32,796** | [Condensed Consolidated Statements of Operations](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q1 2025 saw a **28.4%** revenue increase to **$18.0 million** and a significant narrowing of net loss to **$1.1 million** Income Statement Items (in thousands) | Income Statement Items | Q1 2024 (in thousands) | Q1 2025 (in thousands) | YoY Change | | :--- | :--- | :--- | :--- | | Total Revenues | $14,023 | $18,000 | +28.4% | | Gross Profit | $10,707 | $13,414 | +25.3% | | Loss from Operations | $(1,432) | $(974) | Improvement | | Net Loss | $(3,130) | $(1,094) | Improvement | | Net Loss Attributable to Moatable, Inc. | $(3,103) | $(818) | Improvement | | Basic and Diluted EPS | $(0.004) | $(0.001) | Improvement | [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2025 cash flows reflect increased operating cash usage and a significant outflow from a **$11.1 million** special dividend Cash Flow Items (in thousands) | Cash Flow Items | Q1 2024 (in thousands) | Q1 2025 (in thousands) | | :--- | :--- | :--- | | Net cash used in operating activities | $(886) | $(1,737) | | Net cash (used in) provided by investing activities | $(106) | $4,933 | | Net cash provided by (used in) financing activities | $885 | $(11,163) | | **Net decrease in cash** | **$(107)** | **$(7,967)** | - The primary use of cash in financing activities for Q1 2025 was the payment of a special cash dividend amounting to **$11.1 million**[28](index=28&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail SaaS operations, a prior period financial revision, revenue breakdown, dividend declaration, and a subsequent acquisition - The company operates two main SaaS businesses: Lofty (real estate platform) and Trucker Path (transportation management platform), which generate the majority of revenue from the U.S. market[30](index=30&type=chunk) - A revision was made to prior period financial statements after discovering an understated sales tax liability of **$2.65 million** as of March 31, 2024[40](index=40&type=chunk)[43](index=43&type=chunk) Revenue by Segment (in thousands) | Revenue by Segment | Q1 2024 (in thousands) | Q1 2025 (in thousands) | | :--- | :--- | :--- | | Lofty | $7,949 | $9,811 | | Trucker Path | $6,033 | $8,147 | | Other Operations | $41 | $42 | | **Total Revenues** | **$14,023** | **$18,000** | - On March 5, 2025, the company declared a special cash dividend of approximately **$11 million**, which was paid on March 27, 2025[79](index=79&type=chunk) - Subsequent to the quarter end, on May 1, 2025, a subsidiary of Trucker Path entered into an agreement to acquire Truckers Best Insurance LLC for approximately **$3.0 million**[110](index=110&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=35&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes Q1 2025 revenue growth to SaaS performance, notes increased operating expenses, and confirms sufficient liquidity - Total revenues increased by **28.6%** from **$14.0 million** in Q1 2024 to **$18.0 million** in Q1 2025, primarily due to growth in the SaaS businesses[116](index=116&type=chunk)[132](index=132&type=chunk) - Subscription services revenue grew **23.5%** YoY, driven by an expanded Trucker Path subscriber base, which increased by **7.1%** from Q4 2024 to **135,000** paying subscriptions as of March 31, 2025[132](index=132&type=chunk) - Operating expenses increased **19.0%** YoY to **$14.4 million**, driven by a **39.0%** increase in selling and marketing expenses and a **28.9%** increase in R&D expenses, both primarily due to higher headcount[135](index=135&type=chunk)[140](index=140&type=chunk) - The company had cash and cash equivalents of **$18.8 million** as of March 31, 2025, and management expects this to be sufficient to meet operating needs for at least the next twelve months[143](index=143&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=45&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Moatable, Inc. is not required to provide the information for this item - The company is exempt from this disclosure requirement as it qualifies as a smaller reporting company[159](index=159&type=chunk) [Controls and Procedures](index=45&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were ineffective due to three unremediated material weaknesses, with remediation plans underway - The CEO and CFO concluded that the company's disclosure controls and procedures were not effective as of March 31, 2025[161](index=161&type=chunk) - Three material weaknesses in internal control over financial reporting remain unremediated, relating to: - Lack of a systematic risk assessment process for financial reporting - Lack of evaluation in assessing sales tax applicability, leading to an understated accrual - Lack of evaluations to ensure internal control components are present and functioning[162](index=162&type=chunk)[163](index=163&type=chunk) - Management is implementing remediation plans, which include recruiting personnel with U.S. GAAP knowledge, engaging external experts, designing a better control environment, and implementing a consolidated general ledger system[162](index=162&type=chunk)[163](index=163&type=chunk)[167](index=167&type=chunk) [Part II. OTHER INFORMATION](index=48&type=section&id=Part%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=48&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently a party to any material legal proceedings - As of the report date, the company is not involved in any material legal proceedings[168](index=168&type=chunk) [Risk Factors](index=48&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the fiscal year ended December 31, 2024 - No material changes to risk factors from the most recent Form 10-K were reported[169](index=169&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=48&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company continued its stock repurchase program, repurchasing **33,720 ADSs** for **$57,000** in Q1 2025 - The Board has authorized a stock repurchase program of up to **$15.0 million**, extended through December 31, 2026[170](index=170&type=chunk) Stock Repurchases (in thousands) | Period | Total ADSs Purchased | Average Price Paid Per ADS | Total Cost (in thousands) | | :--- | :--- | :--- | :--- | | January 2025 | 29,667 | $1.71 | $50 | | February 2025 | 4,053 | $1.76 | $7 | | March 2025 | 0 | $0.00 | $0 | | **Total Q1 2025** | **33,720** | **-** | **$57** |

[FORM 8-K Filing Information](index=1&type=section&id=FORM%208-K%20Filing%20Information) This section provides essential identification details for the Form 8-K filing, including registrant name, jurisdiction, address, and filing date [General Information](index=1&type=section&id=General%20Information) This section provides the basic identification details for the Form 8-K filing, including the registrant's name, jurisdiction, address, and contact information, along with the filing date - Registrant Name: **MOATABLE, INC.**[2](index=2&type=chunk) - Date of Report (earliest event reported): **April 15, 2025**[2](index=2&type=chunk) - Jurisdiction of Incorporation: **Cayman Islands**[2](index=2&type=chunk) [Securities Information](index=1&type=section&id=Securities%20Information) This section details the securities registered under Section 12(b) of the Act, including trading symbols and registered exchanges Registered Securities | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | :------------------------------------------------- | :---------------- | :------------------------------------ | | American depositary shares, each representing 45 Class A ordinary shares | MTBLY | OTC Pink | | Class A ordinary shares, par value $0.001 per share* | MTBLY | OTC Pink | * Not for trading, but only in connection with the listing and trading of American depositary shares on OTC Pink. [Item 2.02 Results of Operations and Financial Condition](index=3&type=section&id=Item%202.02%20Results%20of%20Operations%20and%20Financial%20Condition) This section details the revisions made to the company's previously issued financial statements due to an understatement of sales tax liability, impacting various financial metrics across 2023 and 2024 periods [Revisions to Prior Period Financial Statements Overview](index=3&type=section&id=Revisions%20to%20Prior%20Period%20Financial%20Statements%20Overview) Moatable, Inc. revised prior financial statements for 2023 and 2024 due to an identified sales tax liability understatement, presenting impacts prospectively despite immateriality to prior periods - The Company discovered an understatement of sales tax liability as of September 30, 2024, totaling **$3,293 thousand** (tax plus interest)[6](index=6&type=chunk) - The understatement includes **$2,358 thousand** related to prior years (2021-2023) and **$935 thousand** related to the nine months ended September 30, 2024[6](index=6&type=chunk) - Management concluded the misstatement did not materially misstate consolidated financial statements for the year ended December 31, 2023, or condensed consolidated financial statements for various periods in 2023 and 2024[7](index=7&type=chunk) [Financial Statement Revisions - 2023 Periods](index=3&type=section&id=Financial%20Statement%20Revisions%20-%202023%20Periods) This section details specific adjustments to 2023 condensed consolidated financial statements, primarily impacting liabilities, accumulated deficit, selling and marketing expenses, and net income/loss Adjustment to Opening Accumulated Deficit as of January 1, 2023 (in thousands) | Item | As reported | Adjustments | As adjusted | | :------------------ | :---------- | :---------- | :---------- | | Accumulated deficit | $(697,299) | $(1,268) | $(698,567) | [March 31, 2023 Revisions](index=3&type=section&id=March%2031,%202023%20Revisions) Adjustments for March 31, 2023, increased accrued expenses and total liabilities, decreased accumulated deficit and net income, and slightly reduced basic and diluted EPS Key Financial Adjustments for March 31, 2023 (in thousands) | Line Item | As reported | Adjustments | As adjusted | | :----------------------------------- | :---------- | :---------- | :---------- | | Accrued expenses and other current liabilities | $11,647 | $1,524 | $13,171 | | Total current liabilities | $28,820 | $1,524 | $30,344 | | Accumulated deficit | $(692,167) | $(1,524) | $(693,691) | | Selling and marketing | $4,896 | $256 | $5,152 | | Net income | $5,334 | $(256) | $5,078 | | Net income per share (Basic & Diluted) | $0.005 | $(0.0002) | $0.005 | [June 30, 2023 Revisions](index=4&type=section&id=June%2030,%202023%20Revisions) Revisions for June 30, 2023, increased accrued expenses, total liabilities, and accumulated deficit, leading to higher net losses and reduced EPS due to increased selling and marketing expenses Key Financial Adjustments for June 30, 2023 (in thousands) | Line Item | Period | As reported | Adjustments | As adjusted | | :----------------------------------- | :----- | :---------- | :---------- | :---------- | | Accrued expenses and other current liabilities | Q2 | $10,210 | $1,796 | $12,006 | | Accumulated deficit | Q2 | $(707,422) | $(1,796) | $(709,218) | | Selling and marketing | Q2 | $4,639 | $272 | $4,911 | | Net loss | Q2 | $(8,761) | $(272) | $(9,033) | | Net loss per share (Basic & Diluted) | Q2 | $(0.008) | $(0.0003) | $(0.009) | | Selling and marketing | 6M | $9,535 | $528 | $10,063 | | Net loss | 6M | $(3,427) | $(528) | $(3,955) | | Net loss per share (Basic & Diluted) | 6M | $(0.002) | $(0.001) | $(0.003) | [September 30, 2023 Revisions](index=5&type=section&id=September%2030,%202023%20Revisions) Revisions for September 30, 2023, increased accrued expenses, total liabilities, and accumulated deficit, leading to higher net losses and loss per share due to increased selling and marketing expenses Key Financial Adjustments for September 30, 2023 (in thousands) | Line Item | Period | As reported | Adjustments | As adjusted | | :----------------------------------- | :----- | :---------- | :---------- | :---------- | | Accrued expenses and other current liabilities | Q3 | $10,208 | $2,072 | $12,280 | | Accumulated deficit | Q3 | $(714,272) | $(2,072) | $(716,344) | | Selling and marketing | Q3 | $4,382 | $276 | $4,658 | | Net loss | Q3 | $(6,958) | $(276) | $(7,234) | | Net loss per share (Basic & Diluted) | Q3 | $(0.008) | $(0.0003) | $(0.009) | | Selling and marketing | 9M | $13,917 | $804 | $14,721 | | Net loss | 9M | $(10,385) | $(804) | $(11,189) | | Net loss per share (Basic & Diluted) | 9M | $(0.009) | $(0.001) | $(0.010) | [Financial Statement Revisions - 2024 Periods](index=6&type=section&id=Financial%20Statement%20Revisions%20-%202024%20Periods) This section outlines adjustments to 2024 condensed consolidated financial statements, reflecting the sales tax liability understatement's impact on liabilities, accumulated deficit, operating expenses, and net income/loss [March 31, 2024 Revisions](index=6&type=section&id=March%2031,%202024%20Revisions) Adjustments for March 31, 2024, increased accrued expenses, total liabilities, and accumulated deficit, leading to a higher net loss and slightly larger loss per share due to increased selling and marketing expenses Key Financial Adjustments for March 31, 2024 (in thousands) | Line Item | As reported | Adjustments | As adjusted | | :----------------------------------- | :---------- | :---------- | :---------- | | Accrued expenses and other current liabilities | $10,673 | $2,647 | $13,320 | | Total current liabilities | $21,259 | $2,647 | $23,906 | | Accumulated deficit | $(719,129) | $(2,647) | $(721,776) | | Selling and marketing | $3,787 | $289 | $4,076 | | Net loss | $(2,841) | $(289) | $(3,130) | | Net loss per share (Basic & Diluted) | $(0.004) | $(0.0004) | $(0.004) | [June 30, 2024 Revisions](index=7&type=section&id=June%2030,%202024%20Revisions) Revisions for June 30, 2024, increased accrued expenses, total liabilities, and accumulated deficit, leading to higher net losses and loss per share due to increased selling and marketing expenses Key Financial Adjustments for June 30, 2024 (in thousands) | Line Item | Period | As reported | Adjustments | As adjusted | | :----------------------------------- | :----- | :---------- | :---------- | :---------- | | Accrued expenses and other current liabilities | Q2 | $9,821 | $2,957 | $12,778 | | Accumulated deficit | Q2 | $(719,291) | $(2,957) | $(722,248) | | Selling and marketing | Q2 | $4,576 | $310 | $4,886 | | Net loss | Q2 | $(182) | $(310) | $(492) | | Net loss per share (Basic & Diluted) | Q2 | $(0.0002) | $(0.0004) | $(0.0006) | | Selling and marketing | 6M | $8,363 | $599 | $8,962 | | Net loss | 6M | $(3,023) | $(599) | $(3,622) | | Net loss per share (Basic & Diluted) | 6M | $(0.004) | $(0.001) | $(0.005) | [September 30, 2024 Revisions](index=7&type=section&id=September%2030,%202024%20Revisions) Final revisions for September 30, 2024, increased accrued expenses and total liabilities to **$15,135 thousand** and **$27,486 thousand** respectively, deepening the accumulated deficit to **$(721,084) thousand**, and increasing net loss and loss per share Key Financial Adjustments for September 30, 2024 (in thousands) | Line Item | Period | As reported | Adjustments | As adjusted | | :----------------------------------- | :----- | :---------- | :---------- | :---------- | | Accrued expenses and other current liabilities | Q3 | $11,842 | $3,293 | $15,135 | | Total current liabilities | Q3 | $23,084 | $3,293 | $26,377 | | Accumulated deficit | Q3 | $(717,791) | $(3,293) | $(721,084) | | Selling and marketing | Q3 | $4,628 | $336 | $4,964 | | Net income | Q3 | $1,505 | $(336) | $1,169 | | Net income per share (Basic & Diluted) | Q3 | $0.002 | $(0.0004) | $0.001 | | Selling and marketing | 9M | $12,991 | $935 | $13,926 | | Loss from operations | 9M | $(1,856) | $(935) | $(2,791) | | Net loss | 9M | $(1,518) | $(935) | $(2,453) | | Net loss per share (Basic & Diluted) | 9M | $(0.002) | $(0.001) | $(0.003) | [Item 9.01 Financial Statements and Exhibits](index=9&type=section&id=Item%209.01%20Financial%20Statements%20and%20Exhibits) This section lists the financial statements and exhibits filed as part of the Form 8-K, including the Cover Page Interactive Data File [Exhibits](index=9&type=section&id=Exhibits) This section lists the exhibits filed as part of the Form 8-K, including the Cover Page Interactive Data File Exhibits Filed | Exhibit Number | Description | | :------------- | :---------------------------------------------------- | | 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | [SIGNATURES](index=10&type=section&id=SIGNATURES) This section provides details of the official signing of the report, including the signatory's name, title, and the date of signature [Signature Details](index=10&type=section&id=Signature%20Details) The report was duly signed on behalf of Moatable, Inc. by its Chief Financial Officer, Scott Stone, on April 23, 2025 - Signed by: **Scott Stone, Chief Financial Officer**[35](index=35&type=chunk) - Date of Signature: **April 23, 2025**[35](index=35&type=chunk)

Business Operations - The company operates two primary SaaS businesses, Lofty and Trucker Path, focusing on streamlining operations for small business owners and sole proprietors [14]. - As of December 31, 2024, Trucker Path has approximately 900,000 active users and around 126,000 paid subscriptions [26]. - The company acquired LoftyWorks in August 2022 and The Letting Partnership in August 2024, expanding its service offerings in the property management sector [15][25]. - The engineering team for Lofty consists of 157 members, while Trucker Path has 146 members, both teams actively releasing monthly product updates [28][29]. - The company plans to market and sell LoftyWorks in the U.S. starting in Q3 2025, enhancing its product offerings in the property management market [24]. - The company aims to increase revenue from existing customers by investing in new features and services tailored to enterprise and mid-market accounts [22]. - The sales performance of Lofty is influenced by the macro cycle of the real estate market, while Trucker Path experiences more pronounced seasonality due to weather conditions affecting transportation demands [39]. Financial Performance - The company reported a loss from operations of $11.8 million in 2023 and $3.0 million in 2024, indicating ongoing financial challenges [50]. - Negative cash flows from operating activities were $3.2 million in 2023, but improved to positive cash flows of $1.3 million in 2024 [50]. - As of December 31, 2024, the company had net current assets of $20.4 million and an accumulated deficit of $720.8 million, highlighting significant financial strain [51]. - The company relies heavily on customer renewals and the addition of new customers for revenue growth, with a substantial portion of revenue derived from SaaS subscriptions [56]. - Subscription renewal rates are critical, as any decrease could adversely affect future revenue and operating results [57]. - The competitive landscape for SaaS products is intensifying, with significant competition from both established and new companies, which may impact pricing and customer retention [59]. - The company faces risks related to economic downturns that could adversely affect its growth, paid subscriptions, and profitability [45]. Strategic Initiatives - The company intends to pursue partnerships and acquisitions to expand its addressable market and enhance its platforms [22]. - The introduction of freemium versions of products is part of the growth strategy, aimed at expanding customer usage and increasing revenue from existing customers [56]. - The company plans to expand its marketing, sales, and customer service operations to increase its customer base and market acceptance of its SaaS services [70]. - The company must enhance its SaaS offerings to remain competitive, which will require increased research and development investments [75]. Risks and Challenges - The reliance on third-party cloud infrastructure for SaaS services poses risks, including potential service disruptions that could adversely affect business operations [77]. - Cybersecurity threats, including data breaches, could lead to reputational damage and financial liabilities for the company [79]. - The company is dependent on third-party data center providers, and any service interruptions could impair its ability to deliver SaaS services, resulting in customer dissatisfaction [84]. - Increased costs for third-party marketing and data hosting services may significantly harm the company's operating results [86]. - The company relies on third-party applications and APIs for the integration of its SaaS services, which is critical for maintaining revenue streams [87]. - Loss of data from third-party providers could significantly impair the functionality of the company's SaaS services, affecting customer satisfaction and revenue generation [89]. - Privacy and data security concerns may hinder end users' acceptance of the company's SaaS services, potentially limiting market adoption [90]. - The company faces risks from unfavorable U.S. and global economic conditions, including inflation and geopolitical developments, which could adversely affect financial performance [93]. Regulatory and Compliance Issues - The company transitioned to a U.S. domestic issuer effective January 1, 2023, and moved its global headquarters to Phoenix, Arizona [18]. - The ongoing Russia-Ukraine conflict and related sanctions have introduced significant uncertainty into global markets, potentially impacting the company's operations and costs [97]. - Regulatory restrictions on data transfer between the U.S. and China may create operational challenges for the company, particularly in its R&D efforts [100]. - The company faces uncertainties regarding compliance with PRC laws and regulations, which could affect its operations and financial condition [133]. - The PRC government's oversight could lead to material adverse changes in the company's operations, especially regarding overseas offerings and foreign investments [151]. Corporate Governance - The company has appointed two new independent board members to improve corporate governance following its transition to a U.S. domestic issuer [111]. - The company identified three material weaknesses in internal control over financial reporting as of December 31, 2024, including lack of risk assessment processes and sales tax evaluations [110]. - The implementation of a global ERP system was completed in 2022, enhancing centralized monitoring and standardization of financial reporting [111]. - As of December 31, 2024, the company concluded that its internal control over financial reporting was not effective, which may adversely affect investor confidence and the market price of its ADSs [113]. Shareholder and Market Considerations - The company’s founder, Mr. Joseph Chen, holds approximately 34.1% of Class A shares and all Class B shares, representing 84.6% of total voting power, which may limit shareholder influence [125]. - The market price for the company's ADSs has fluctuated significantly, ranging from $0.21 to $118.05 since listing on the NYSE on May 4, 2011 [174]. - The company's ADSs may be subject to trading prohibitions if the PCAOB cannot inspect its auditors, which could negatively impact the value of investments [163]. - The company may be classified as a Passive Foreign Investment Company (PFIC) for U.S. federal income tax purposes, which could result in adverse tax consequences for U.S. holders of the ADSs or ordinary shares [188]. Cybersecurity Measures - The company recognizes cybersecurity as a critical component of its risk management strategy and is committed to protecting digital assets and customer data from cyber threats [197]. - The company conducts regular assessments to identify potential cybersecurity threats, which are reviewed by external auditors as part of annual audits [197]. - The company has implemented various information security processes to manage material risks from cybersecurity threats to its critical data and systems [197]. - The company maintains a robust vendor management program to mitigate cybersecurity risks associated with third-party providers [202]. - The company’s cybersecurity incident response policy is designed to escalate incidents to management, including the chief technology officer [207].

Financial Performance - SaaS revenue for Q3 2024 increased to $16,641,000, up 25.5% from $13,257,000 in Q3 2023[20] - Total revenues for the nine months ended September 30, 2024, reached $45,998,000, representing a 20.2% increase from $38,308,000 in the same period of 2023[20] - Gross profit for Q3 2024 was $12,633,000, a 20.6% increase compared to $10,478,000 in Q3 2023[20] - Operating expenses for Q3 2024 totaled $12,868,000, up from $11,277,000 in Q3 2023, reflecting a 14.1% increase[20] - Net loss attributable to Moatable, Inc. for Q3 2024 was $1,500,000, a significant improvement from a net loss of $6,850,000 in Q3 2023[20] - Comprehensive loss attributable to Moatable, Inc. for Q3 2024 was $1,517,000, compared to a comprehensive loss of $6,706,000 in Q3 2023[22] - For the nine months ended September 30, 2023, the net loss was $10,385 million, while for the same period in 2024, the net loss decreased to $1,518 million[32] - The net loss for the three months ended September 30, 2024, was $1,698,000, a decrease from a net loss of $4,180,000 for the same period in 2023, showing an improvement of approximately 59.4%[41] - For the nine months ended September 30, 2024, the net loss was $8,808,000, compared to $10,918,000 for the same period in 2023, indicating a reduction of about 19.3%[41] - The company reported a net income of $1.5 million for the three months ended September 30, 2024, a significant improvement from a net loss of $7.0 million for the same period in 2023[132] Assets and Liabilities - Total assets increased from $69,700,000 as of December 31, 2023, to $72,506,000 as of September 30, 2024, reflecting a growth of approximately 4%[15] - Current liabilities rose from $21,440,000 to $23,084,000, an increase of about 7.7%[15] - Shareholders' equity decreased slightly from $62,760,000 to $62,589,000, a decline of approximately 0.3%[18] - Cash and cash equivalents decreased from $33,913,000 to $33,150,000, a reduction of about 2.3%[15] - Total liabilities increased from $21,629,000 to $24,193,000, an increase of approximately 11.8%[18] - Total liabilities decreased to $5,600,000 as of September 30, 2024, from $7,802,000 as of December 31, 2023, indicating a reduction of about 28.2%[41] - Cash and cash equivalents stood at $33.2 million as of September 30, 2024, expected to meet operating needs for at least the next twelve months[176] Revenue and Growth - Total revenue for the Company across all segments for the nine months ended September 30, 2024, was $45,998,000, compared to $38,308,000 for the same period in 2023[118] - Revenues increased by 25.5% from $13.3 million for the three months ended September 30, 2023 to $16.7 million for the same period in 2024, primarily due to growth in SaaS businesses[149] - Subscription services revenue rose by 24.2% from $12.3 million for the three months ended September 30, 2023 to $15.3 million for the same period in 2024, with paying subscriptions for Lofty and Trucker Path increasing by 11% and 21% respectively[151] Expenses and Costs - Selling and marketing expenses for the three months ended September 30, 2024 were $4.6 million, accounting for 27.7% of total revenues[142] - Research and development expenses for the three months ended September 30, 2024 were $4.8 million, representing 28.6% of total revenues[142] - The cost of revenues increased from $2.8 million for the three months ended September 30, 2023 to $4.1 million for the same period in 2024[140] - Operating expenses increased by 14.1% from $11.3 million for the three months ended September 30, 2023 to $12.9 million for the same period in 2024, mainly due to cost reduction initiatives[156] - General and administrative expenses increased by 31.7% from $2.6 million for the three months ended September 30, 2023 to $3.5 million for the same period in 2024, primarily due to higher legal fees and new office expenses[158] Shareholder Information - Additional paid-in capital rose from $782,365,000 to $784,570,000, a slight increase of about 0.3%[18] - The company reported a fair value change on long-term investments of $5,989 million for the nine months ended September 30, 2023[32] - The company had a repurchase of Class A ordinary shares amounting to $32 million[27] - The Company’s Stock Repurchase Program was extended to December 31, 2024, with an increased authorized repurchase amount from $10.0 million to $15.0 million[90] Acquisitions and Investments - The acquisition of The Letting Partnership Ltd was completed for a total cash consideration of approximately $4,432 million, with £2,700 million paid at closing[73] - Net revenue from The Letting Partnership Ltd since acquisition was $277 million, and net income was $22 million for the nine months ended September 30, 2024[79] - The Company recognized a share of income from Fundrise, L.P. of $455 million for the nine months ended September 30, 2024[81] Operational Insights - Moatable, Inc. operates two main SaaS businesses, Lofty and Trucker Path, with the majority of revenue generated from the U.S. market[1] - The company has a team of approximately 300 engineers and developers, accounting for about 52% of total employees as of September 30, 2024[185] - The company expects to increasingly invest in developing Lofty products following the acquisition of Rentancy[186]

Core Insights - Moatable, Inc. reported a 19% increase in revenue for Q2 2024, reaching $15.3 million compared to Q2 2023 [2] - The company achieved a significant improvement in adjusted EBITDA, moving from a loss of $1.8 million in Q2 2023 to a profit of $0.8 million in Q2 2024 [2][3] - Total cash and cash equivalents stood at $39.2 million at the end of Q2 2024, slightly up from $39.0 million at the end of 2023 [2] Financial Performance - Revenue for the six months ended June 30, 2024, increased by 17% to $29.3 million compared to the same period last year [2] - Gross profit for Q2 2024 was $11.8 million, a 15% increase from Q2 2023, while gross profit for the first half of 2024 rose 14% to $22.5 million [2] - Loss from operations improved by 83% from a loss of $2.8 million in Q2 2023 to a loss of $0.5 million in Q2 2024 [2] Operational Highlights - The company operates two US-based SaaS businesses, Lofty and Trucker Path [4] - The CFO highlighted the importance of cost rationalization in achieving profitability, with adjusted EBITDA showing a positive trend from Q1 2024 to Q2 2024 [3] - The total operating expenses for Q2 2024 were $12.3 million, down from $13.1 million in Q2 2023 [9]

Financial Position - Total assets decreased from $69,700,000 as of December 31, 2023, to $68,115,000 as of June 30, 2024, representing a decline of approximately 2.3%[13] - Current assets increased from $46,184,000 to $47,083,000, an increase of about 1.9%[13] - Cash and cash equivalents slightly increased from $33,913,000 to $34,067,000, a growth of approximately 0.5%[13] - Accounts receivable, net rose from $2,603,000 to $3,231,000, reflecting an increase of around 24.1%[13] - Total current liabilities decreased from $21,440,000 to $20,918,000, a reduction of about 2.4%[13] - Shareholders' equity decreased from $48,071,000 to $47,189,000, a decline of approximately 1.8%[17] - The accumulated deficit increased from $716,315,000 to $719,291,000, indicating a rise of about 0.4%[17] - Total liabilities decreased from $21,629,000 to $20,926,000, a decrease of approximately 3.2%[13] - Long-term investments decreased from $15,733,000 to $13,783,000, a decline of about 12.4%[13] - Intangible assets, net decreased from $727,000 to $448,000, a drop of approximately 38.4%[13] Revenue and Profitability - SaaS revenue for the three months ended June 30, 2024, was $15,249 million, up from $12,851 million for the same period in 2023, representing a growth of 18.6%[20] - Total revenues for the six months ended June 30, 2024, reached $29,312 million, compared to $25,017 million for the same period in 2023, indicating a year-over-year increase of 17.5%[20] - Gross profit for the three months ended June 30, 2024, was $11,789 million, compared to $10,247 million for the same period in 2023, reflecting a growth of 15.1%[20] - Total operating expenses for the three months ended June 30, 2024, were $13,078 million, an increase from $12,267 million for the same period in 2023, marking a rise of 6.6%[20] - Net loss for the three months ended June 30, 2024, was $(8,761) million, compared to $(182) million for the same period in 2023, indicating a significant increase in losses[21] - Comprehensive loss attributable to Moatable Inc. for the three months ended June 30, 2024, was $(7,933) million, compared to $(273) million for the same period in 2023[21] Cash Flow and Investments - The company reported cash and cash equivalents of $20,799,000 at the end of June 30, 2023, down from $27,960,000 at the beginning of the period[28] - The total cash used in operating activities for the six months ended June 30, 2023, was $5,142,000, compared to $289,000 for the same period in 2024[28] - The company redeemed $4,905,000 in short-term investments during the six months ended June 30, 2023[28] - The net cash provided by investing activities was $3,921,000 for the six months ended June 30, 2023[28] - The company reported a decrease in cash and cash equivalents of $7,640,000 for the six months ended June 30, 2023[28] Shareholder Information - As of March 31, 2024, the balance of Class A ordinary shares was 703,529,281, while Class B ordinary shares were 170,258,970[24] - The Company repurchased 53,433 ADSs for $32 during the three months ended June 30, 2024, at a weighted average price of $0.61 per ADS[67] - The Stock Repurchase Program was extended to December 31, 2024, with an increased authorized repurchase amount from $10 million to $15 million[65] - The weighted average number of shares used in calculating net loss per share attributable to Moatable Inc. shareholders was 1,007,327,376 for the three months ended June 30, 2024[20] Deferred Revenue and Future Expectations - Total deferred revenue increased from $4,322,000 as of December 31, 2023, to $4,551,000 as of June 30, 2024, indicating a growth of approximately 5.3%[52] - The Company expects to recognize a significant portion of deferred revenue within one year, with $3,310,000 recognized during the six months ended June 30, 2024, from previously deferred amounts[52] Research and Development - Research and development expenses for the three months ended June 30, 2024, were $4,911 million, compared to $4,555 million for the same period in 2023, showing an increase of 7.8%[20] - Research and development expenses were $9.0 million for the six months ended June 30, 2024, down from $9.8 million for the same period in 2023[152] Impairments and Losses - The Company recognized an impairment loss of $588 for the investment in Beijing Fenghou Tianyuan Investment and Management Center L.P. for the six months ended June 30, 2024[57] - Impairment of intangible assets increased from nil for the six months ended June 30, 2023, to $0.2 million for the same period in 2024, primarily due to impairment of the technology platform of LoftyWorks[135] Subscription Services - Subscription services revenue for Lofty increased from $6.779 million in Q2 2023 to $8.045 million in Q2 2024, a growth of approximately 18.6%[96] - Subscription services revenue for Trucker Path grew from $5.155 million in Q2 2023 to $6.234 million in Q2 2024, reflecting an increase of about 20.9%[96] - Paying subscriptions for Lofty and Trucker Path increased to 4,100 and 111,600, representing growth of 10.8% and 14.9% respectively compared to June 30, 2023[125]

Revenue Growth - Total revenues increased from $12,149 thousand in Q1 2023 to $14,023 thousand in Q1 2024, representing a growth of 15.4%[20] - SaaS revenue rose from $12,080 thousand in Q1 2023 to $13,982 thousand in Q1 2024, an increase of 15.7%[20] - For the three months ended March 31, 2024, Lofty reported total revenue of $7,949,000, an increase from $6,826,000 in the same period of 2023, representing a growth of 16.5%[93] - Trucker Path's revenue for the three months ended March 31, 2024, was $6,033,000, up from $5,254,000 in the prior year, indicating a growth of 14.8%[93] - Subscription revenue increased by 16.3% from $11.3 million for the three months ended March 31, 2023 to $13.2 million for the same period in 2024[122] Profitability and Loss - Net income attributable to Moatable Inc. decreased from $5,970 thousand in Q1 2023 to a net loss of $2,814 thousand in Q1 2024[20] - As of March 31, 2024, Moatable, Inc. reported a net loss of $2,841,000 compared to a net income of $5,334,000 for the three months ended March 31, 2023[30] - The company reported a net loss per share of $(0.004) for Q1 2024 compared to a net income per share of $0.005 for Q1 2023[20] - The net loss for the three months ended March 31, 2024, was $(2,746,000), compared to a net loss of $(4,383,000) for the same period in 2023, reflecting an improvement of approximately 37.4%[41] Operating Expenses - Operating expenses decreased from $12,845 thousand in Q1 2023 to $11,850 thousand in Q1 2024, a reduction of 7.8%[20] - Selling and marketing expenses decreased by 22.7% from $4.9 million for the three months ended March 31, 2023 to $3.8 million for the same period in 2024[127] - Research and development expenses decreased by 9.1% from $4.9 million for the three months ended March 31, 2023 to $4.5 million for the same period in 2024[127] - General and administrative expenses increased by 11.5% from $3.0 million in Q1 2023 to $3.4 million in Q1 2024, primarily due to legal fees related to a derivative action settlement recovery claim[128] Cash Flow and Liquidity - Cash and cash equivalents slightly decreased from $33,913 thousand as of December 31, 2023, to $33,774 thousand as of March 31, 2024[14] - The company experienced a decrease in cash and cash equivalents, ending the period with $25,613,000, down from $27,960,000 at the beginning of the period[30] - Net cash used in operating activities was $886,000 for the three months ended March 31, 2024, compared to $2,827,000 for the same period in 2023[30] - Cash flows from financing activities provided $885,000 in the three months ended March 31, 2024, compared to $1,417,000 in the same period of 2023[30] - Cash and cash equivalents, excluding restricted cash, were $33.8 million as of March 31, 2024, indicating a strong liquidity position[133] Assets and Liabilities - Total assets decreased from $69,700 thousand as of December 31, 2023, to $68,096 thousand as of March 31, 2024[16] - Total liabilities decreased from $21,629 thousand as of December 31, 2023, to $21,357 thousand as of March 31, 2024[16] - The company had a total of $170,258,970 in ordinary shares outstanding as of March 31, 2024[30] - As of March 31, 2024, total assets of the VIE were $6,443,000, down from $7,001,000 as of December 31, 2023, while total liabilities decreased from $11,877,000 to $8,179,000[41] Share-Based Compensation - Share-based compensation expense for the three months ended March 31, 2024, was $672,000, a decrease from $765,000 in the same period of 2023[30] - The total share-based compensation expense for the three months ended March 31, 2024, was $672,000, down from $765,000 in the same period of 2023, reflecting a decrease of 12.2%[84] - The total number of nonvested restricted shares outstanding decreased from 20,538,376 as of December 31, 2023, to 16,080,091 as of March 31, 2024[75] - The company has a total unrecognized compensation expense of $1,922 thousand related to nonvested restricted shares as of March 31, 2024[76] Investments and Impairments - The company reported a fair value change on long-term investments of $1,488,000 for the three months ended March 31, 2024, compared to a loss of $8,276,000 in the same period of 2023[30] - The investment in Kaixin Auto Holdings decreased significantly from $1,921 million to $435 million, reflecting an unrealized loss of $1,488 million for the three months ended March 31, 2024[60] - The company recognized an impairment loss of $588 million related to its investment in Beijing Fenghou Tianyuan Investment and Management Center L.P. for the three months ended March 31, 2024[59] Deferred Revenue - Total deferred revenue was $4,333,000 as of March 31, 2024, slightly up from $4,322,000 as of December 31, 2023, indicating a marginal increase[53] - Total deferred revenue remained stable at $4.3 million as of March 31, 2024, with most expected to be recognized as revenue within one year[109] Future Outlook and Strategy - The company expects to increasingly invest in developing Lofty-related products following the acquisition of LoftyWorks, aiming to enhance service offerings for property managers and landlords[143] - The Company is evaluating the impact of new accounting standards issued by the FASB, which may affect future financial disclosures[54][55]

Core Points - Moatable, Inc. has received a notice from the NYSE regarding the delisting of its American depositary shares (ADSs) due to falling below the required market capitalization of $15 million over a 30 trading day period [1] - The company has the right to appeal this decision within ten business days, and trading of its ADSs will be suspended immediately [2] - Following the delisting, the company's ADSs will begin trading on the OTC Markets' Pink market, with potential plans to apply for OTCQB or OTCQX marketplaces [2] Company Overview - Moatable, Inc. operates two US-based SaaS businesses, Lofty Inc. and Trucker Path Inc., and its ADSs represent 45 Class A ordinary shares [3]

SaaS Business Overview - The company's SaaS businesses generate the majority of its revenue, with sales almost exclusively to customers within the United States[18] - The company's SaaS businesses benefit from a large and growing customer base, which provides opportunities to offer additional paid products and services[21] - Revenue heavily depends on SaaS subscriptions, particularly from Lofty and Trucker Path services[57] - The SaaS market is highly competitive, with potential price reductions and unfavorable terms due to competitive pressures[62] Lofty Platform - Lofty, the company's SaaS platform for real estate professionals, has over 800,000 active users and almost 95,000 paid subscriptions as of December 31, 2023[28] - The company plans to market and sell LoftyWorks, a cloud-based property management SaaS platform, in the U.S. during the second quarter of 2024[27] - The company's engineering team for Lofty consists of 157 members as of December 31, 2023, and releases product updates every month based on user feedback[29] - Lofty's sales are primarily derived from online digital marketing, with a focus on enterprise customers requiring over 100 seats, which involves a longer sales cycle compared to SMB customers[33] - Lofty experienced net losses of $16.2 million in 2022 and $10.7 million in 2023, with negative cash flows from operating activities of $3.8 million and $3.2 million, respectively[53] - The Lofty business is highly dependent on the health of the U.S. residential real estate market, which faces challenges like low inventory and fluctuating mortgage rates[67] - A $1.8 billion jury verdict in the NAR Class Action lawsuit could significantly impact real estate commission structures and the Lofty business[69] Trucker Path Platform - Trucker Path, the company's transportation network platform, has over 370,000 businesses listed as points-of-interest and serves SMB truck fleets with its enterprise Transportation Management System offering[28] - Trucker Path has an engineering team of 125 members as of December 31, 2023, including mobile developers, front-end/back-end engineers, product managers, and Quality Assurance personnel[30] - Trucker Path's sales are driven by active users, primarily long-haul truck drivers, with seasonality impacting sales during winter months and long holidays[38] - Trucker Path competes with map service providers, small fleet navigation services, and digital load boards, as well as companies selling advertising to businesses serving truckers[35] Growth Strategy - The company's strategy includes growing its customer base, increasing revenue from existing customers, and pursuing partnerships and acquisitions[22][23] - The company plans to expand marketing, sales, and customer service operations to grow its customer base[72] - High-quality customer support is critical for retaining customers and expanding into large enterprise accounts[76] Financial Performance and Risks - Net current assets as of December 31, 2023, were $24.7 million, with an accumulated deficit of $716.3 million[54] - The company has sufficient cash reserves for operating needs for at least the next twelve months[54] - Subscription renewal rates may decline due to pricing changes, competition, or economic downturns, impacting future revenue[59] - The company recorded $22.4 million and $7.7 million in losses from its equity investment in Kaixin Auto Holdings during 2022 and 2023, respectively[98] - The company reimbursed East West Bank $8.0 million due to a default by Kaixin Subsidiary, leaving $1.2 million in restricted cash[98] - Share-based compensation expenses were $8.5 million, $4.0 million, and $3.0 million for 2021, 2022, and 2023, respectively, with $2.5 million in unrecognized expenses as of December 31, 2023[106] - The company identified material weaknesses in internal control over financial reporting, which remain unremediated as of December 31, 2023[117] Operational Risks - The company faces risks related to customer renewals, competition, economic downturns, and the need to adapt to rapidly changing technology and customer needs[44] - Security concerns, service interruptions, and reliance on third-party data centers and online marketing services could adversely impact the company's operations[46] - The company relies heavily on third-party cloud infrastructure, particularly Amazon Web Services, for hosting its SaaS services, and any disruptions could significantly impact operations[87][88] - A significant portion of the company's R&D personnel and resources are based in China, making it vulnerable to disruptions in China's internet infrastructure and telecommunications networks[78][95] - The company faces risks from cyber-attacks, data breaches, and unauthorized access to its systems, which could result in reputational damage and financial losses[81][83][84] - The company depends on third-party online payment platforms, and any security breaches could harm its reputation and deter users from using its services[85][86] - The company's SaaS services rely on integrations with third-party applications like Amazon Web Services, Here Maps, and Google Cloud, and changes to these platforms could negatively impact its offerings[90] - The company's inbound lead generation and data center operating costs are heavily influenced by third-party marketing and hosting services, and cost increases could harm operating results[89] - Privacy and data security concerns may limit the adoption of the company's SaaS services, especially in industries handling sensitive personal information[94] Economic and Geopolitical Risks - The company's business could be adversely affected by unfavorable U.S. and global economic conditions, including inflation, geopolitical conflicts, and supply chain disruptions[100] - High inflation in the U.S. could increase operating costs, reduce liquidity, and limit access to credit, potentially harming the company's business[101] - The Russia-Ukraine conflict and related sanctions have disrupted trade, supply chains, and liquidity, increasing global market uncertainty[104] - The company employs the majority of its R&D personnel in China, and U.S. or China trade restrictions could adversely affect innovation and product development[105] Corporate Governance and Legal Risks - The company's dual-class voting structure allows the founder, chairman, and CEO to significantly influence corporate matters, potentially limiting shareholder influence[49] - The company's dual-class voting structure gives the founder 82.8% of total voting power, with Class B shares having 10 votes per share compared to 1 vote per Class A share[128][129] - The company relies on key personnel, including CEO Joseph Chen and COO James Jian Liu, whose potential loss could severely disrupt operations[120] - Competition for highly skilled personnel in the SaaS industry is intense, and failure to attract or retain talent could hinder growth[121] - Labor cost increases and changes in labor laws in operating countries may adversely affect the company's business and results[123] - Labor costs in the US, China, the Philippines, and other operating countries are expected to continue increasing due to inflation and rising wages[124] - Compliance costs in China have increased due to evolving PRC tax laws and regulations, including individual income tax withholding requirements[126] - Contractual arrangements with Qianxiang Tiancheng may not be as effective as direct ownership in providing operational control over China operations[136][137] - PRC regulatory authorities could disallow the company's contractual arrangements with Qianxiang Tiancheng, affecting China operations[134] - The company may need CSRC approval for future overseas securities offerings under new PRC regulations effective March 2023[141][142] - Internet platform operators with over 1 million users' personal information must undergo cybersecurity review before overseas listing[144] - PRC companies engaged in prohibited businesses under the Negative List must obtain government approval for overseas listings[145] - Potential regulatory risks from CSRC, CAC, or other PRC agencies regarding overseas securities offerings and ADS listing status, which could lead to fines, operational restrictions, or adverse effects on business and financial conditions[146][147] - Contractual arrangements with Qianxiang Tiancheng may face scrutiny by PRC tax authorities, potentially resulting in additional taxes, reduced net income, and penalties[148][149] - Conflicts of interest between Qianxiang Tiancheng shareholders and the company, particularly involving key executives and their dual roles, which could disrupt operations and require costly legal resolutions[150][151] - Uncertainties in the interpretation and implementation of the PRC Foreign Investment Law, which may impact the company's corporate structure, governance, and business operations[152][153][154] - PRC government oversight could lead to material adverse changes in operations, particularly due to potential interventions in overseas offerings or foreign investments in China-based issuers[156] - Fluctuations in exchange rates between RMB and USD could materially affect the company's costs, expenses, financial position, and the value of ADSs, with limited hedging options available in China[158][159][160] - Compliance risks with PRC regulations on employee share ownership or stock option plans, potentially resulting in fines or legal sanctions for the company or its employees[162][163][164] - Risks related to indirect transfers of equity interests in PRC resident enterprises by non-PRC holding companies, which may trigger PRC withholding taxes and interest charges under SAT Circular 7[165][166] ADS and Market Risks - The company's ADSs have experienced significant price fluctuations, ranging from $0.45 to $360.00 per ADS since listing on the NYSE on May 4, 2011[177] - The PCAOB completed inspections of audit firms in mainland China and Hong Kong in 2022, vacating the previous Determination Report[172] - The Accelerating Holding Foreign Companies Accountable Act reduced the non-inspection years triggering trading prohibitions from three to two years, increasing risks[175] - The company moved its headquarters and financial accounting leadership to the U.S. in 2021, while retaining R&D activities in China[173] - If identified as a Commission-Identified Issuer for two consecutive years, the company's securities could be prohibited from trading in the U.S.[176] - The company's auditor, Marcum Asia CPAs LLP, is headquartered in New York and not included in the PCAOB Identified Firms list[171] - The company may face increased income tax expenses for future acquisitions due to potential adjustments under SAT Circular 7[168] - The depositary may decide not to distribute certain cash dividends or other distributions to ADS holders if deemed impractical or inequitable[185] - ADS holders may not receive voting materials in time to exercise voting rights, and the depositary is not responsible for failed voting instructions[182] - The company's ADSs are subject to transfer limitations, with the depositary able to close transfer books at any time deemed expedient[186] - The company may be classified as a Passive Foreign Investment Company (PFIC) for U.S. federal income tax purposes, potentially leading to adverse tax consequences for U.S. holders of ADSs or ordinary shares[193][194] - The company's total market capitalization as of March 25, 2024, is under $15 million, and its total stockholders' equity as of December 31, 2023, is $48.1 million[200] - The company is not in compliance with NYSE continued listing criteria due to the average closing price of its ADSs being $0.99 over a 30 trading-day period ending December 6, 2023[199] Cybersecurity Measures - The company has implemented various cybersecurity measures, including SOC 2 Type 2 Review, ISO 27001 audit, and annual disaster recovery testing, to manage and mitigate material risks from cybersecurity threats[203][205] - The company's information technology department collaborates with security and compliance teams to identify, assess, and manage cybersecurity threats using manual and automated tools, internal and external audits, and third-party threat assessments[204]