Financial Performance - Net income from continuing operations for the three months ended June 30, 2023, was $26,079, compared to a loss of $452,139 for the same period in 2022[11]. - Total service revenue for the three months ended June 30, 2023, was $603,343, down from $1,451,459 in the same period last year, representing a decline of approximately 58.4%[11]. - Operating expenses for the three months ended June 30, 2023, were $822,220, compared to $1,827,438 for the same period in 2022, a decrease of about 55.1%[11]. - The company reported a gross loss of $94,582 for the three months ended June 30, 2023, compared to a gross profit of $1,355,510 in the same period last year[11]. - Total comprehensive loss for the three months ended June 30, 2023, was $(637,193), compared to a loss of $(1,365,792) for the same period in 2022[11]. - As of June 30, 2023, the net loss from operations was $958,761, compared to a net profit of $140,177 for the same period in 2022[21]. - The company reported a net loss of $926,518 for the six months ended June 30, 2023, compared to a net income of $274,871 in the same period of 2022[118]. - Total revenue for the six-month period ended June 30, 2023, was $603,343, a decrease of approximately 83.2% from $3,590,411 in the same period of 2022[120]. Assets and Liabilities - Total current assets decreased from $34,215,145 to $30,741,321, a decline of approximately 13.5%[10]. - Total liabilities decreased from $4,509,731 to $3,541,531, a reduction of about 21.5%[10]. - Total assets decreased from $46,229,241 to $42,421,096, a decline of approximately 8.7%[10]. - Accumulated deficits increased from $(1,714,110) to $(3,917,104) over the six months ended June 30, 2023[10]. - The total cash and cash equivalents at the end of the period were $20,004,914, a decrease from $20,025,480 at the beginning of the period[21]. - Loan receivables increased significantly to $7,220,242 as of June 30, 2023, compared to $1,614,841 as of December 31, 2022[87]. - Cash on hand as of June 30, 2023, was $20,004,914, primarily due to the uplisting to the Nasdaq and a public offering that generated net proceeds of $37,057,176[130]. Revenue and Expenses - The company incurred a cost of revenue of $1,005,089 for the six months ended June 30, 2023, compared to $768,587 in 2022, indicating an increase in expenses related to system development[119]. - General and administrative expenses decreased to $1,501,985 for the six months ended June 30, 2023, from $2,619,894 in 2022, a reduction of approximately 42.5%[123]. - Service revenue from non-related parties was $566,813 for the six months ended June 30, 2023, down from $3,302,074 in 2022, reflecting a decline of about 82.8%[120]. YCloud System and Market Strategy - The market for individual micro-business owners is projected to reach 330 million users by the end of 2023[24]. - The YCloud system integrates multiple payment methods, allowing micro-businesses to manage transactions through platforms like Alipay and WeChat[27]. - The company aims to establish global strategic cooperation with various social media platforms through the YCloud system[24]. - The YCloud system provides AI-driven recommendations and management tools to enhance user experience and operational efficiency[30]. - The company has established trial operations in Hong Kong, expanding its market presence beyond mainland China[24]. - The total order amount processed through the YCloud system is directly entered into the platform for fund collection, enhancing financial management for users[27]. - The company plans to shift its SAAS, blockchain, and WT Pay services from the PRC to overseas markets in 2023[120]. Internal Controls and Compliance - The company conducted an evaluation of its internal control over financial reporting as of June 30, 2023, and concluded that it did not maintain effective internal control due to material weaknesses identified[138]. - Management identified material weaknesses related to internal audit functions and lack of segregation of duties within accounting functions[139]. - The company believes that its financial statements and other information presented are materially correct despite the identified weaknesses[138]. - There were no changes in internal control over financial reporting that materially affected the company's controls during the most recently completed fiscal quarter[142]. - Management plans to implement procedures to assure proper transaction initiation, asset custody, and transaction recording by separate individuals[140]. Stock and Share Information - The total issued and outstanding shares of the company's common stock decreased from 195,057,503 to 1,054,364 shares following a 1 for 185 Reverse Stock Split approved on June 9, 2023[146]. - The Reverse Stock Split aims to help the company regain compliance with Nasdaq's minimum bid price requirement of $1.00 per share[147]. - The weighted-average common shares outstanding decreased to 172,526,771 from 231,052,498 year-over-year[62]. Accounting Policies - The company applies ASC 606 for revenue recognition, which involves a five-step model for recognizing revenue[39]. - The company has adopted ASU 2016-02 for leases, requiring recognition of operating and financing lease liabilities on the balance sheet[53]. - The company does not anticipate any material impact from recently issued accounting pronouncements that are not yet effective[135].

Financial Performance - Total service revenue for the three months ended March 31, 2023, was $614,369, a decrease of 71.2% from $2,138,952 in the same period of 2022[13] - Gross loss for the three months ended March 31, 2023, was $(296,137), compared to a gross profit of $1,466,314 in the same period of 2022[13] - Net loss from continuing operations for the three months ended March 31, 2023, was $(984,842), a significant decline from a net income of $592,316 in the same period of 2022[13] - Total revenue for the three-month period ended March 31, 2023, was $614,369, a decrease from $2,138,952 in the same period of 2022, primarily due to a reduction in Gross Merchandise Volume (GMV)[112] - Service revenue from non-related parties was $577,171 for the three months ended March 31, 2023, compared to $1,980,434 in 2022, indicating a significant decline[112] - The company reported a net loss of $984,842 for the three months ended March 31, 2023, compared to a net income of $592,316 in the same period of 2022[114] Assets and Equity - Total assets increased from $43,200,496 as of December 31, 2022, to $46,229,241 as of March 31, 2023, representing a growth of 6.9%[10][12] - Total stockholders' equity decreased from $41,719,510 as of December 31, 2022, to $39,516,758 as of March 31, 2023, a decline of 5.3%[12] - As of March 31, 2023, the total shareholder equity was $39,516,758, a decrease from $41,719,510 as of December 31, 2022, reflecting a net loss of $958,520 for the period[18] - The company reported a total accumulated deficit of $3,943,183 as of March 31, 2023, compared to an accumulated deficit of $1,714,110 as of December 31, 2022[18] Cash Flow and Liquidity - Cash and cash equivalents at the end of the period increased to $20,125,507 from $20,025,480, reflecting a slight increase of 0.5%[15] - Cash flows used in operating activities for the three months ended March 31, 2023, were $(552,673), compared to cash provided of $6,208,013 in the same period of 2022[16] - Cash on hand increased to $20,125,507 as of March 31, 2023, up from $6,356,060 in the prior period, largely due to the public offering[115] Operating Expenses - Operating expenses for the three months ended March 31, 2023, were $690,793, down from $792,456 in the same period of 2022, a decrease of 12.8%[13] - The company reported a loss from discontinued operations of $1,240,305 for the three months ended March 31, 2023, compared to a loss of $1,336,142 for the same period in 2022[92] Market and Strategic Initiatives - The market for individual micro-business owners is projected to reach 330 million users by the end of 2023, indicating significant growth potential for the company's services[22] - The YCloud system is designed to provide multiple integrated payment methods, enhancing the operational capabilities of micro-businesses[24] - The company aims to establish global strategic cooperation with various social media platforms to expand its market reach[22] - The YCloud system utilizes AI fission technology to analyze user behavior and provide tailored recommendations, enhancing user engagement[27] - The company has established trial operations in Hong Kong, indicating plans for market expansion beyond mainland China[22] - The company aims to shift its SAAS, blockchain, and WT Pay services from the PRC to overseas markets in 2023[112] Shareholder Information - The weighted average number of shares outstanding decreased from 305,451,498 in the same period of 2022 to 195,057,503 in 2023, a reduction of 36.2%[13] - The company conducted a 1-for-185 reverse stock split, reducing total outstanding shares from 195,057,503 to 1,054,364[103] - The company has no potentially dilutive shares as of March 31, 2023[55] - There are no fractional shares issued as a result of the Reverse Stock Split; they will be rounded up to the nearest whole share[127] Compliance and Reporting - The consolidated financial statements have been prepared in accordance with GAAP, ensuring compliance and transparency in financial reporting[29] - The financial statements for the fiscal quarter ended March 31, 2023, have been filed in XBRL format, including the Balance Sheet, Statement of Income, and Statement of Cash Flows[128] - The certifications of the Principal Executive Officer and Principal Financial Officer have been filed in accordance with the Sarbanes-Oxley Act[128] - There were no changes in internal control over financial reporting that materially affected the company's financial statements during the most recently completed fiscal quarter[125] - The company has not reported any material weaknesses in its internal controls[125] - The company is classified as a "smaller reporting company" and is not required to disclose certain risk factors[125] - No legal proceedings are currently pending against the company[125] Other Financial Metrics - Total GMV for the period ended March 31, 2023, was $18,606,599, a decrease from $74,561,767 in the same period of 2022[64] - The company’s intangible assets, net, amounted to $21,525 as of March 31, 2023, down from $22,959 as of December 31, 2022[68] - Amortization expense for intangible assets for the three months ended March 31, 2023, was $1,434[68] - The average exchange rate for RMB to USD was 6.84 for the period ended March 31, 2023, compared to 6.75 for the year ended December 31, 2022[39] - Accounts receivable increased to $6,748,798 as of March 31, 2023, compared to $6,723,661 as of December 31, 2022, with all service fee receivables fully settled from five main customers[76] - Total prepayments amounted to $13,137,035 as of March 31, 2023, primarily related to a $10 million prepayment for the WT Pay system development expected to be completed by September 2023[78] - Loan receivables decreased significantly to $978,133 as of March 31, 2023, down from $1,614,841 as of December 31, 2022, with no accrued interest due to a waiver[82][83] - Other payables totaled $1,708,748 as of March 31, 2023, a decrease from $2,325,188 as of December 31, 2022, primarily due to Y-Cloud system upgrade payables[89] - Tax payables decreased to $86,838 as of March 31, 2023, from $130,717 as of December 31, 2022, reflecting a reduction in corporate income tax obligations[88] - Accrued expenses totaled $377,423 as of March 31, 2023, encompassing accrued payroll and social welfare contributions[87] - The company’s related party payables decreased to $1,280,966 as of March 31, 2023, from $1,291,296 as of December 31, 2022[86] - Amortized expenses, net, decreased to $780,326 as of March 31, 2023, from $828,983 as of December 31, 2022, indicating a rise in accumulated depreciation[74] Public Offering - The company completed a public offering of 10,000,000 shares at $4.00 per share, raising gross proceeds of $40,000,000 and net proceeds of $37,057,176 after costs[100]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended: December 31, 2022 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to _____________ WETRADE GROUP INC (Exact name of registrant as specified in its charter) | --- | --- | |------------------------------------------|--------------- ...