Core Insights - ZCMD's stock price increased by 21.72% to $1.05 per share, with a total market capitalization of $26.51 million as of August 26 [1] - The company's total revenue for the year ending December 31, 2024, is projected to be $15.86 million, representing an 18.37% year-over-year decline [1] - The net profit attributable to the parent company is expected to be -$0.6432 million, showing a significant improvement of 94.33% year-over-year [1] Company Overview - ZCMD is a Cayman Islands-registered holding company established on April 16, 2019, and operates through its subsidiary, ZCMD Medical Technology (Shanghai) Co., Ltd. [1] - The company focuses on medical education and patient education, offering three main business segments: 1. Medical MOOCs, 2. Sunshine Health Classroom, 3. Patient Assistance Program [1] - The Medical MOOCs platform combines advanced medical education concepts with modern internet technology, providing accessible and continuous learning opportunities for healthcare professionals [1]

Core Viewpoint - Zhongchao Medical (ZCMD) experienced an 11.25% increase in stock price, reaching $0.96 per share, with a total market capitalization of $24.23 million as of August 25 [1] Financial Performance - For the fiscal year ending December 31, 2024, Zhongchao Medical reported total revenue of $15.86 million, a year-over-year decrease of 18.37% [1] - The company recorded a net profit attributable to shareholders of -$0.6432 million, which represents a significant year-over-year increase of 94.33% [1] Company Overview - Zhongchao Medical was established on April 16, 2019, as an offshore holding company registered in the Cayman Islands, with its operations managed by its domestic subsidiary, Zhongchao Medical Technology (Shanghai) Co., Ltd. [1] - The company operates a digital medical education platform called Medical MOOC, which integrates advanced medical education concepts with modern internet technology, providing accessible and continuous learning opportunities for healthcare professionals [1] - Zhongchao Medical focuses on three main business segments: 1. Medical MOOC, 2. Sunshine Health Classroom, 3. Zhongxun Patient Assistance [1]

Core Insights - ZCMD's stock opened up by 5.44% on August 22, reaching $0.95 per share with a total market capitalization of $23.99 million [1] - For the fiscal year ending December 31, 2024, ZCMD reported total revenue of $15.86 million, a year-over-year decrease of 18.37%, while the net profit attributable to the parent company was -$0.6432 million, reflecting a year-over-year increase of 94.33% [1] Company Overview - ZCMD is a Cayman Islands-registered holding company established on April 16, 2019, and operates through its subsidiary, ZCMD Medical Technology (Shanghai) Co., Ltd [1] - The company offers a digital medical education platform called Medical MOOC, which integrates advanced medical education concepts with modern internet technology, providing accessible and continuous learning opportunities for healthcare professionals [1] - ZCMD focuses on three main business segments: 1. Medical MOOC, 2. Sunshine Health Classroom, 3. Patient Assistance Program [1]

Core Viewpoint - Zhongchao Medical (ZCMD) experienced a stock price increase of 2.44% on August 22, reaching $0.91 per share, with a total market capitalization of $22.99 million [1] Financial Performance - As of December 31, 2024, Zhongchao Medical reported total revenue of $15.86 million, a year-over-year decrease of 18.37% [1] - The company recorded a net profit attributable to shareholders of -$0.6432 million, which represents a year-over-year increase of 94.33% [1] Company Overview - Zhongchao Medical was established on April 16, 2019, as an offshore holding company registered in the Cayman Islands, operated by its domestic subsidiary, Zhongchao Medical Technology (Shanghai) Co., Ltd. [1] - The company offers a digital medical education platform called Medical MOOC, which combines advanced medical education concepts with modern internet technology, providing accessible and continuous learning opportunities for healthcare professionals [1] - Zhongchao Medical focuses on three main business segments: 1. Medical MOOC, 2. Sunshine Health Classroom, 3. Zhongxun Patient Assistance [1]

Core Viewpoint - Zhongchao Medical (ZCMD) experienced a stock price increase of 6.52% on August 19, reaching $0.98 per share, with a total market capitalization of $24.7488 million [1] Financial Performance - As of December 31, 2024, Zhongchao Medical reported total revenue of $15.8648 million, a year-over-year decrease of 18.37% [1] - The company recorded a net profit attributable to shareholders of -$0.6432 million, which represents a year-over-year increase of 94.33% [1] Company Overview - Zhongchao Medical is a foreign holding company registered in the Cayman Islands on April 16, 2019, and operates through its domestic subsidiary, Zhongchao Medical Technology (Shanghai) Co., Ltd. [1] - The subsidiary's platform, Medical MOOC, integrates advanced medical education concepts with modern internet technology, providing accessible and continuous learning opportunities for healthcare professionals [1] - Zhongchao Medical focuses on three main business segments: 1. Medical MOOC, 2. Sunshine Health Classroom, 3. Zhongxun Patient Assistance [1]

Core Viewpoint - Zhongchao Medical (ZCMD) experienced a 4.06% increase in stock price, reaching $1.00 per share, with a total market capitalization of $25.25 million as of August 14 [1] Financial Performance - For the fiscal year ending December 31, 2024, Zhongchao Medical reported total revenue of $15.86 million, a year-over-year decrease of 18.37% [1] - The company recorded a net profit attributable to shareholders of -$0.6432 million, which represents a significant year-over-year increase of 94.33% [1] Company Overview - Zhongchao Medical was established on April 16, 2019, as an offshore holding company registered in the Cayman Islands, with its operations managed by its domestic subsidiary, Zhongchao Medical Technology (Shanghai) Co., Ltd. [1] - The company operates a digital medical education platform called Medical MOOC, which integrates advanced medical education concepts with modern internet technology, providing accessible and continuous learning opportunities for healthcare professionals [1] - Zhongchao Medical focuses on three main business segments: 1. Medical MOOC, 2. Sunshine Health Classroom, 3. Zhongxun Patient Assistance [1]

Core Viewpoint - Zhongchao Medical (ZCMD) experienced a 3.37% increase in stock price, reaching $0.993 per share, with a total market capitalization of $25.0872 million as of August 7 [1] Financial Performance - For the fiscal year ending December 31, 2024, Zhongchao Medical reported total revenue of $15.8648 million, a year-on-year decrease of 18.37% [1] - The company recorded a net profit attributable to shareholders of -$0.6432 million, which represents a year-on-year increase of 94.33% [1] Company Overview - Zhongchao Medical was established on April 16, 2019, as an offshore holding company registered in the Cayman Islands, with its operations managed by its domestic subsidiary, Zhongchao Medical Technology (Shanghai) Co., Ltd. [1] - The company operates a digital medical education platform called Medical MOOC, which combines advanced medical education concepts with modern internet technology, providing accessible and continuous learning opportunities for healthcare professionals [1] - Zhongchao Medical focuses on three main business segments: 1. Medical MOOC, 2. Sunshine Health Classroom, 3. Zhongxun Patient Assistance [1]

Core Viewpoint - Zhongchao Medical (ZCMD) has experienced a stock price increase of 2.91% as of July 30, with a current share price of $1.06 and a total market capitalization of $26.7691 million [1] Financial Performance - For the fiscal year ending December 31, 2024, Zhongchao Medical reported total revenue of $15.8648 million, representing a year-over-year decrease of 18.37% [1] - The company recorded a net profit attributable to the parent company of -$0.6432 million, which is a significant improvement with a year-over-year increase of 94.33% [1] Company Overview - Zhongchao Medical was established on April 16, 2019, as an offshore holding company registered in the Cayman Islands, with its operations managed by its domestic subsidiary, Zhongchao Medical Technology (Shanghai) Co., Ltd. [1] - The company operates a digital medical education platform called Medical MOOC, which integrates advanced medical education concepts with modern internet technology, providing accessible and continuous learning opportunities for healthcare professionals [1] - Zhongchao Medical focuses on three main business segments: 1. Medical MOOC, 2. Sunshine Health Classroom, 3. Zhongxun Patient Assistance [1]

PART I [Item 3. Key Information](index=7&type=section&id=Item%203.%20Key%20Information) This section outlines the company's VIE structure, PRC regulatory risks, dividend policies, cash transfer restrictions, and presents condensed financial data [Corporate Structure and VIE Arrangements](index=7&type=section&id=Corporate%20Structure%20and%20VIE%20Arrangements) The company operates as a Cayman Islands holding company, controlling PRC entities via a VIE structure due to foreign ownership restrictions - The company operates as a Cayman Islands holding company and consolidates its PRC operations through a VIE structure due to PRC restrictions on foreign ownership in the telecommunications sector[22](index=22&type=chunk) - The VIE structure subjects the company to unique risks, including the potential for the contractual arrangements to be ineffective in providing control and uncertainties regarding the interpretation and application of PRC laws[23](index=23&type=chunk) [PRC Regulatory Permissions](index=8&type=section&id=PRC%20Regulatory%20Permissions) New CSRC rules require filings for future refinancing, though the current VIE structure is deemed compliant by PRC legal counsel - The CSRC's Trial Measures, effective March 31, 2023, require domestic companies seeking overseas listings to complete filing procedures. As an existing issuer, Zhongchao is not required to file immediately but must do so for future refinancing[24](index=24&type=chunk) - The company's PRC legal counsel, Han Kun Law Offices, has opined that the current corporate structure and VIE arrangements do not violate existing PRC laws[26](index=26&type=chunk) - The company acknowledges that it may need to obtain additional licenses or approvals in the future due to the uncertain interpretation of PRC laws, and failure to do so could result in penalties or suspension of operations[26](index=26&type=chunk) [Dividend Distributions and Cash Transfers](index=9&type=section&id=Dividend%20Distributions%20and%20Cash%20Transfers) Cash transfers from parent to U.S. subsidiary totaled **$4.4 million** in 2024; no PRC dividends due to reinvestment and regulatory hurdles Cash Transfers from Zhongchao Cayman to Zhongchao USA | Year Ended December 31 | Amount Transferred (USD) | | :--- | :--- | | 2024 | $4.4 million | | 2023 | $0.1 million | | 2022 | $1.5 million | - No dividends or distributions have been made from any subsidiaries or the VIE to the parent company, Zhongchao Cayman, or to any U.S. investors for the years ended December 31, 2022, 2023, and 2024[27](index=27&type=chunk) - PRC regulations require subsidiaries in China to set aside at least **10% of after-tax profits** into a statutory reserve until it reaches **50% of registered capital**, which restricts funds available for distribution[29](index=29&type=chunk) - The PRC government imposes controls on currency conversion and remittance, which may create difficulties in paying dividends from profits generated in China[30](index=30&type=chunk) [Financial Information Related to the VIE](index=11&type=section&id=Financial%20Information%20Related%20to%20the%20VIE) Condensed consolidated financial statements for 2024, 2023, and 2022 illustrate the financial separation and reliance on the VIE structure Condensed Consolidated Balance Sheet as of December 31, 2024 (in USD) | Account | Parent (USD) | Subsidiaries (USD) | WFOE (USD) | VIE and its Subsidiaries (USD) | Total Consolidated (USD) | | :--- | :--- | :--- | :--- | :--- | :--- | | **Total Assets** | **22,544,367** | **5,284,101** | **32,680** | **15,412,624** | **25,884,953** | | Total Liabilities | - | 11,072,304 | - | 2,201,474 | 1,733,900 | | Total Equity | 22,544,367 | (5,788,203) | 32,680 | 13,211,150 | 24,151,053 | Condensed Consolidated Statement of Operations for the Year Ended December 31, 2024 (in USD) | Account | Parent (USD) | Subsidiaries (USD) | WFOE (USD) | VIE and its Subsidiaries (USD) | Total Consolidated (USD) | | :--- | :--- | :--- | :--- | :--- | :--- | | **Revenues** | **-** | **-** | **-** | **15,864,773** | **15,864,773** | | Gross Profit | - | - | - | 8,912,213 | 8,912,213 | | **Net (Loss) Income** | **(643,229)** | **(642,807)** | **2,532,747** | **2,902,555** | **(273,413)** | Condensed Consolidated Cash Flows for the Year Ended December 31, 2024 (in USD) | Account | Parent (USD) | Subsidiaries (USD) | WFOE (USD) | VIE and its Subsidiaries (USD) | Total Consolidated (USD) | | :--- | :--- | :--- | :--- | :--- | :--- | | Net cash from operating activities | 198,117 | 878,538 | (1,382) | 1,528,919 | (1,473,243) | | Net cash from investing activities | (3,097,823) | (521,865) | - | (2,487,565) | (1,807,753) | | Net cash from financing activities | 3,838,200 | - | - | - | 3,838,200 | [Risk Factors](index=13&type=section&id=D.%20Risk%20Factors) The company faces material risks from healthcare dependence, competition, VIE structure, dual-class shares, and significant PRC government influence - The company's business is exposed to risks from its dependence on the healthcare industry, increasing competition, and the potential for unauthorized use of its intellectual property[43](index=43&type=chunk) - Structural risks include reliance on VIE arrangements which may not be as effective as direct ownership, and a dual-class share structure that concentrates voting control with the CEO[43](index=43&type=chunk) - Operating in China presents risks from substantial government influence, vague and uncertain laws, currency conversion controls, and potential delisting from U.S. exchanges under the Holding Foreign Companies Accountable Act (HFCA Act)[44](index=44&type=chunk)[45](index=45&type=chunk) [Item 4. Information on the Company](index=57&type=section&id=Item%204.%20Information%20on%20the%20Company) This section details the company's history, corporate structure, business operations, technology, intellectual property, and physical properties [History and Development of the Company](index=57&type=section&id=A.%20History%20and%20Development%20of%20the%20Company) Incorporated in 2019, the company operates through a VIE structure, with a 1-for-10 share consolidation and **$3.93 million** raised in 2024 offerings - The company is a holding company incorporated in the Cayman Islands in 2019, conducting its business through a VIE, Zhongchao Shanghai, which was established in 2012[241](index=241&type=chunk)[243](index=243&type=chunk)[244](index=244&type=chunk) - In 2024, the company executed a **1-for-10 share consolidation**, a registered direct offering of **3.094 million Class A shares** raising approximately **$0.93 million**, and a private placement of **10 million Class A shares** and warrants raising **$3.0 million**[248](index=248&type=chunk)[324](index=324&type=chunk)[325](index=325&type=chunk) - The company has recently streamlined its business structure by deregistering two subsidiaries, Shanghai Xinyuan and Liaoning Zhixun, in late 2024 and early 2025[327](index=327&type=chunk) [Business Overview](index=59&type=section&id=B.%20Business%20Overview) The company provides online healthcare information, professional training (MDMOOC), patient management (Zhongxin Health), and patented drug sales in China - The company provides online healthcare information, professional training, and patient management services focused on oncology and other major diseases in China[254](index=254&type=chunk) - Key service brands include "MDMOOC" for professional education, "Zhongxin Health" for patient management, and "Sunshine Health Forums" for public health information[255](index=255&type=chunk)[282](index=282&type=chunk)[285](index=285&type=chunk) - The company expanded into pharmaceutical sales through its subsidiary Xinjiang Pharmaceutical, which operates a B2B2C procurement platform[256](index=256&type=chunk)[300](index=300&type=chunk) - The company's content is distributed through its proprietary platforms (mobile app, website) and major social media networks in China, creating monetization opportunities through embedded advertisements[286](index=286&type=chunk) [Organizational Structure](index=102&type=section&id=C.%20Our%20Structure) An organizational chart illustrates the multi-layered corporate legal structure, from the Cayman Islands holding company to the PRC VIE - The company's structure is a multi-layered holding company model with the ultimate parent in the Cayman Islands, intermediary holding companies, a WFOE in the PRC, and the operating business held within a VIE structure[459](index=459&type=chunk)[460](index=460&type=chunk) [Property, Plants and Equipment](index=103&type=section&id=D.%20Property,%20Plants%20and%20Equipment) The company owns offices in Shanghai and Beijing, leases spaces in six other cities, and holds residential properties for talent recruitment - The company owns its main offices in Beijing and Shanghai and leases space in **6 other cities**[462](index=462&type=chunk) - The company has purchased residential apartments in Japan, the U.S. (New York), and China (Beijing, Tangshan) as part of its talent recruitment and business expansion strategy[462](index=462&type=chunk)[464](index=464&type=chunk) Rent Expenses | Year Ended December 31 | Amount (USD) | | :--- | :--- | | 2024 | $218,227 | | 2023 | $412,891 | | 2022 | $498,166 | [Item 5. Operating and Financial Review and Prospects](index=104&type=section&id=Item%205.%20Operating%20and%20Financial%20Review%20and%20Prospects) This section analyzes the company's financial performance, including revenue decline, narrowed net loss, liquidity, capital resources, and critical accounting policies [Operating Results](index=104&type=section&id=A.%20Operating%20results) FY2024 revenues decreased by **18.4%** to **$15.9 million** due to lower drug sales, while net loss significantly narrowed to **$0.3 million** Consolidated Results of Operations (in USD) | | 2024 (USD) | 2023 (USD) | 2022 (USD) | | :--- | :--- | :--- | :--- | | **Total Revenues** | **15,864,773** | **19,433,945** | **14,151,516** | | Service Revenue | 13,712,964 | 10,406,734 | 12,935,420 | | Product Revenue | 2,151,809 | 9,027,211 | 1,216,096 | | **Gross Profit** | **8,912,213** | **8,512,192** | **6,356,664** | | Loss from Operations | (341,267) | (13,283,798) | (2,954,462) | | **Net Loss** | **(273,413)** | **(11,307,239)** | **(2,822,319)** | - Revenue decreased by **18.4%** in FY2024 primarily due to a **$6.9 million** decline in drug sales as demand normalized after a peak in 2023. This was partially offset by increased revenue from medical training and patient management services[475](index=475&type=chunk) - Net loss narrowed significantly to **$0.3 million** in FY2024 from **$11.3 million** in FY2023. The improvement was mainly due to the absence of large impairment charges on goodwill and intangible assets related to the West Angel acquisition that were recorded in 2023[484](index=484&type=chunk)[490](index=490&type=chunk) [Liquidity and Capital Resources](index=111&type=section&id=B.%20Liquidity%20and%20capital%20resources) The company's liquidity includes **$7.8 million** in cash and **$17.2 million** working capital, with PRC regulations restricting cash transfers from its entities Summary of Cash Flows (in USD) | | 2024 (USD) | 2023 (USD) | 2022 (USD) | | :--- | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | (1,473,243) | 54,229 | (661,740) | | Net cash used in investing activities | (1,807,753) | (3,754,655) | (3,346,658) | | Net cash provided by financing activities | 3,838,200 | - | 1,850,744 | | **Cash and cash equivalents at end of year** | **7,841,306** | **7,548,694** | **11,520,453** | - As of December 31, 2024, the company had cash and cash equivalents of approximately **$7.8 million** and working capital of **$17.2 million**[525](index=525&type=chunk) - The company raised **$3.8 million** from financing activities in 2024 through the issuance of Class A ordinary shares[524](index=524&type=chunk)[539](index=539&type=chunk) - The ability to transfer funds from PRC entities to the parent company is restricted by PRC foreign exchange regulations and statutory reserve requirements[527](index=527&type=chunk)[542](index=542&type=chunk) [Item 6. Directors, Senior Management and Employees](index=117&type=section&id=Item%206.%20Directors,%20Senior%20Management%20and%20Employees) This section details the company's five-member board, executive compensation, 2019 Equity Incentive Plan, and **111** full-time employees - The Board of Directors consists of five members: Weiguang Yang (Chairman & CEO), Pei Xu (CFO & Director), and three independent directors: John C. General, Kevin Dean Vassily, and Dan Li[565](index=565&type=chunk) 2024 Executive Compensation Summary | Name/Principal Position | Salary (USD) | | :--- | :--- | | Weiguang Yang / CEO | 66,707 | | Pei Xu / CFO | 45,839 | | Xuejun Chen / Chief Medical Officer | 63,371 | | Baoqian Tian / Chief Sales Officer | 83,438 | | Shuang Wu / Chief Operating Officer | 31,686 | - The company has adopted a 2019 Equity Incentive Plan for granting awards to key employees, directors, and consultants. The plan allows for the issuance of up to **97,088 Class A Ordinary Shares**, plus an annual increase[595](index=595&type=chunk)[597](index=597&type=chunk) - As of the report date, the company employed **111 full-time staff**, with the majority in technical/customer services (**74**) and sales/marketing (**19**)[628](index=628&type=chunk) [Item 7. Major Shareholders and Related Party Transactions](index=128&type=section&id=Item%207.%20Major%20Shareholders%20and%20Related%20Party%20Transactions) CEO Weiguang Yang is the controlling shareholder with **69.0%** voting power via Class B shares; related party transactions are audit committee reviewed - CEO Weiguang Yang is the controlling shareholder, holding **69.0%** of the company's total voting power through his beneficial ownership of **549,772 Class B Ordinary Shares**[637](index=637&type=chunk) - The company has a dual-class share structure where each Class A Ordinary Share has **1 vote** and each Class B Ordinary Share has **100 votes**[637](index=637&type=chunk) [Item 8. Financial Information](index=131&type=section&id=Item%208.%20Financial%20Information) This section confirms audited financial statements, absence of material legal proceedings, and a policy of no dividends due to reinvestment plans - The company is not currently a party to any legal proceedings expected to have a material adverse effect on its business[644](index=644&type=chunk) - The company has never declared a dividend and does not anticipate declaring one in the foreseeable future, planning to reinvest earnings[645](index=645&type=chunk) [Item 11. Quantitative and Qualitative Disclosures About Market Risk](index=140&type=section&id=Item%2011.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Primary market risks include foreign currency fluctuations due to RMB operations and USD reporting, and credit risk from concentrated cash and investments - The company's primary market risk is foreign currency risk, as most of its assets, liabilities, revenues, and costs are denominated in RMB, while its financial statements are presented in U.S. dollars[702](index=702&type=chunk)[703](index=703&type=chunk) - Credit risk is concentrated in cash and cash equivalents, with significant balances held in financial institutions in China, the U.S., Japan, and Hong Kong that exceed government deposit insurance limits[705](index=705&type=chunk)[709](index=709&type=chunk) - Interest rate risk is considered not material as exposure primarily relates to interest income from cash deposits[701](index=701&type=chunk) PART II [Item 15. Controls and Procedures](index=142&type=section&id=Item%2015.%20Controls%20and%20Procedures) Management concluded disclosure controls were ineffective as of December 31, 2024, due to material weaknesses in monitoring and U.S. GAAP expertise - Management concluded that disclosure controls and procedures were not effective as of December 31, 2024[716](index=716&type=chunk) - Two material weaknesses were identified: (1) lack of key monitoring mechanisms like an internal control department, and (2) insufficient resources and expertise with US GAAP and SEC reporting in the accounting department[717](index=717&type=chunk)[720](index=720&type=chunk) - Remediation efforts include hiring an experienced outside consultant, providing ongoing US GAAP training, and working to establish an internal audit department[718](index=718&type=chunk)[720](index=720&type=chunk) [Item 16. Other Information](index=144&type=section&id=Item%2016.%20Other%20Information) This section covers governance, audit committee financial expert, accountant fees, cybersecurity risk management, and the absence of material incidents - The Board has designated John C. General as the audit committee financial expert[724](index=724&type=chunk) Principal Accountant Fees (USD) | | 2024 (USD) | 2023 (USD) | | :--- | :--- | :--- | | Audit Fees (Prager Metis) | 407,000 | 375,000 | | Predecessor auditor (Marcum Asia) | 58,000 | 35,000 | | **Total Fees** | **465,000** | **410,000** | - The company has established policies and processes for managing cybersecurity risks, integrated into its overall risk management system, and has designated a Security and Information Officer[739](index=739&type=chunk)[744](index=744&type=chunk) - No material cybersecurity incidents were experienced during the fiscal year ended December 31, 2024[747](index=747&type=chunk) PART III [Item 18. Financial Statements](index=149&type=section&id=Item%2018.%20Financial%20Statements) This section presents the complete audited consolidated financial statements for 2024, 2023, and 2022, including balance sheets, statements of operations, equity, and cash flows Consolidated Balance Sheet Highlights (in USD) | | Dec 31, 2024 (USD) | Dec 31, 2023 (USD) | | :--- | :--- | :--- | | **Total Assets** | **25,884,953** | **24,416,643** | | Total Current Assets | 18,707,217 | 18,711,046 | | **Total Liabilities** | **1,733,900** | **3,378,473** | | Total Current Liabilities | 1,530,430 | 2,678,361 | | **Total Equity** | **24,151,053** | **21,038,170** | Consolidated Statement of Operations Highlights (in USD) | | 2024 (USD) | 2023 (USD) | 2022 (USD) | | :--- | :--- | :--- | :--- | | **Total Revenues** | **15,864,773** | **19,433,945** | **14,151,516** | | Gross Profit | 8,912,213 | 8,512,192 | 6,356,664 | | Loss from Operations | (341,267) | (13,283,798) | (2,954,462) | | **Net Loss** | **(273,413)** | **(11,307,239)** | **(2,822,319)** | - The company's revenue is disaggregated into two main segments: MDMOOC services (medical training and patient management) and sales of patented drugs[881](index=881&type=chunk)[971](index=971&type=chunk) - The notes to the financial statements confirm the company's reliance on its VIE structure and provide a breakdown of the VIE's assets, liabilities, and operational results, which constitute the vast majority of the consolidated figures[894](index=894&type=chunk)

[Financial Statements](index=1&type=section&id=Financial%20Statements) The H1 2024 financials reflect a return to profitability and positive operating cash flow, offset by significant capital expenditures and adverse currency effects [Unaudited Condensed Consolidated Balance Sheets](index=1&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2024, total assets slightly decreased to $24.03 million, while property and equipment saw a significant increase | Balance Sheet Items | June 30, 2024 (USD) | Dec 31, 2023 (USD) | Change | | :--- | :--- | :--- | :--- | | **Total Assets** | **$24,033,166** | **$24,416,643** | **-1.6%** | | Cash and cash equivalents | $6,279,809 | $7,548,694 | -16.8% | | Property and equipment, net | $5,073,142 | $3,222,252 | +57.4% | | **Total Liabilities** | **$3,313,550** | **$3,378,473** | **-1.9%** | | Accounts payable | $1,225,720 | $683,937 | +79.2% | | **Total Equity** | **$20,719,616** | **$21,038,170** | **-1.5%** | - Total current assets decreased to **$16.71 million** from $18.71 million, mainly due to a reduction in cash[1](index=1&type=chunk) - A significant increase in **Property and equipment, net**, was observed, rising by over **57%** to $5.07 million[1](index=1&type=chunk) [Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss](index=2&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) The company returned to profitability in H1 2024 with a net income of $182,933, despite a decrease in total revenues | Income Statement Items | Six Months Ended June 30, 2024 (USD) | Six Months Ended June 30, 2023 (USD) | | :--- | :--- | :--- | | **Total Revenues** | **$8,348,329** | **$10,376,170** | | Service Revenue | $6,595,083 | $4,856,333 | | Product Revenue | $1,753,246 | $5,519,837 | | **Gross Profit** | **$4,737,096** | **$4,323,339** | | **Total Operating Expenses** | **($4,788,646)** | **($10,347,910)** | | **Net Income (Loss)** | **$182,933** | **($4,779,858)** | | **Basic and Diluted EPS** | **$0.03** | **($1.81)** | - The company's revenue mix shifted significantly, with service revenue growing by **35.8% YoY**, while product revenue declined by **68.2% YoY**[2](index=2&type=chunk) - Profitability improved dramatically, with the company swinging from a loss from operations of $6.02 million in H1 2023 to a minimal loss of **$51,550** in H1 2024, primarily due to a more than 50% reduction in operating expenses[2](index=2&type=chunk) [Unaudited Condensed Consolidated Statements of Changes in Equity](index=3&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Equity) Total equity decreased to $20.72 million as net income was offset by negative foreign currency translation adjustments | Equity Changes (Six Months Ended June 30, 2024) | Amount (USD) | | :--- | :--- | | **Balance as of Dec 31, 2023** | **$21,038,170** | | Share-based compensation expenses | $26,279 | | Net income | $182,933 | | Foreign currency translation adjustments | ($527,766) | | **Balance as of June 30, 2024** | **$20,719,616** | - The accumulated deficit improved from **($7.27 million)** to **($7.12 million)** due to the net income recorded during the period[3](index=3&type=chunk) [Unaudited Condensed Consolidated Statements of Cash Flows](index=4&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) The company generated positive operating cash flow of $0.81 million, but a net cash decrease resulted from significant investing activities | Cash Flow Items (Six Months Ended June 30) | 2024 (USD) | 2023 (USD) | | :--- | :--- | :--- | | **Net Cash Provided by (Used in) Operating Activities** | **$809,598** | **($1,853,153)** | | **Net Cash (Used in) Provided by Investing Activities** | **($1,797,664)** | **$1,938,682** | | **Net Cash Provided by Financing Activities** | **$0** | **$0** | | Effect of exchange rate changes on cash | ($280,819) | ($319,161) | | **Net decrease in cash and cash equivalents** | **($1,268,885)** | **($233,632)** | | **Cash and cash equivalents at end of period** | **$6,279,809** | **$11,286,821** | - The company's cash flow from operations turned positive, driven by net income and favorable changes in working capital, such as an increase in accounts payable[6](index=6&type=chunk) - A significant cash outflow of **$2.10 million** was used for the purchase of property and equipment, contrasting with a minimal purchase of $12,269 in the same period last year[6](index=6&type=chunk)