Financial Performance - For the six months ended June 30, 2025, net revenue decreased to $36,612 from $378,839 in the same period of 2024, representing a decline of approximately 90.3%[7] - Gross profit for the six months ended June 30, 2025, was $17,643, down from $18,449 in 2024, a decrease of about 4.4%[7] - The net loss for the six months ended June 30, 2025, was $11,271,548, significantly higher than the net loss of $1,927,027 in 2024, marking an increase of about 485.5%[7] - The Group reported a total comprehensive loss of $11,832,015 for the six months ended June 30, 2025, compared to a total comprehensive loss of $1,980,508 in 2024, an increase of approximately 497.5%[7] - Net cash used in operating activities was $3,649,470 for the six months ended June 30, 2025, up from $2,282,403 in 2024, indicating increased cash outflow[65] - Accumulated deficits reached $25,577,935 as of June 30, 2025, compared to $14,306,387 as of December 31, 2024, reflecting worsening financial health[65] Operating Expenses - Total operating expenses surged to $11,345,874 for the six months ended June 30, 2025, compared to $1,964,867 in 2024, reflecting an increase of approximately 478.5%[7] - Non-employee share-based compensation expenses amounted to $6,856,485 for the six months ended June 30, 2025, indicating significant investment in equity compensation[13] - Total accrued expenses and other current liabilities increased by 53.5% to $293,216 as of June 30, 2025, compared to $191,098 as of December 31, 2024[77] - Operating lease costs for the six months ended June 30, 2025, were $202,730, down 12% from $230,495 in the same period of 2024[78] - The Group's cash paid for operating leases was $185,800 for the six months ended June 30, 2025, compared to $280,738 in 2024, reflecting a decrease of 33.8%[79] Assets and Liabilities - Total assets decreased to $2,652,675 as of June 30, 2025, from $3,034,249 as of December 31, 2024, a decline of approximately 12.6%[4] - Total liabilities increased to $8,009,267 as of June 30, 2025, compared to $3,415,311 as of December 31, 2024, representing an increase of about 134.5%[4] - Cash at the end of the period was $184,618, down from $194,113 at the beginning of the period, a decrease of approximately 4.3%[13] - The Group's contract assets increased to $159,247 as of June 30, 2025, up from $138,740 as of December 31, 2024[45] - Deferred revenue rose to $543,849 as of June 30, 2025, compared to $409,654 as of December 31, 2024, indicating a growth of 32.7%[46] Shareholder Equity and Financing - The weighted average number of ordinary shares increased to 621,289,700 for the six months ended June 30, 2025, compared to 501,964,286 in 2024, an increase of about 23.7%[7] - The Group closed its initial public offering of 1,800,000 American Depositary Shares at a price of US$5.00 per ADS, raising a total of US$9.0 million, with net proceeds of approximately US$5.6 million[18] - The Company completed its initial public offering of 1,800,000 ADSs at US$5.00 per ADS, raising approximately US$5.6 million in net proceeds[107] - The Group received $2,374,566 in net proceeds from a private investment in public equity (PIPE) transaction in September 2025, aimed at alleviating liquidity pressure[69] - The Company entered into a Securities Purchase Agreement issuing convertible promissory notes totaling US$2.18 million and 14,295,000 Class B ordinary shares[118] Revenue Breakdown - The Group's total revenues for the six months ended June 30, 2025, were US$36,612, a decrease of 90.3% compared to US$378,839 for the same period in 2024[43] - Business consulting service revenue was US$0 for the six months ended June 30, 2025, compared to US$111,318 in 2024[43] - IT customization revenue decreased to US$22,106 in 2025 from US$265,649 in 2024, representing a decline of 91.7%[43] - Customer A and Customer B represented 47% and 39% of the Group's total revenue for the six months ended June 30, 2025, totaling 86%[111] - Supplier A represented 25% of the Group's total purchases for the six months ended June 30, 2025[112] Credit and Risk Management - Allowance for doubtful receivables was US$18,913 as of June 30, 2025, up from US$10,265 as of December 31, 2024[27] - The allowance for expected credit loss increased to $18,913 as of June 30, 2025, from $10,265 as of December 31, 2024, indicating higher anticipated credit risk[71] - The Group's accounts receivable, amounts due from related parties, and deposits are evaluated for expected credit losses using an aging schedule method[25] Future Outlook and Strategy - The Group's liquidity is under pressure, with cash of $184,618 and positive working capital of $11,092 as of June 30, 2025[66] - The Group plans to pursue private financing and develop new business initiatives in 2025 to generate sufficient profit and cash flow[69] - A strategic investment to acquire a 30% equity stake in Tongxin Innovation Limited was valued at approximately US$3 million, expanding Trident's Web 3.0 ecosystem[119] Miscellaneous - Valuation allowance for deferred tax assets was recorded at $3,244,738 as of June 30, 2025, reflecting management's assessment of future taxable income[50] - The Group reported a net operating loss carried forward of $18,711,663 as of June 30, 2025, which can be carried forward indefinitely[86] - The total borrowings as of June 30, 2025, included a principal amount of $314,490 from Maybank Singapore Limited, with an interest rate of 5.00%[88] - Interest expenses for the six months ended June 30, 2025, were $3,696, a decrease of 47.6% from $7,057 in 2024[88] - Research and development services provided to the Company by related parties amounted to $200,055 for the six months ended June 30, 2025[94] - The number of shares available for awards under the Amended and Restated 2023 Equity Incentive Plan increased from 55,000,000 to 137,500,000[95] - The fair value of consulting services provided by external consultants was determined to be US$27,348,750 for 99,000,000 Class B Ordinary Shares issued[96] - Share-based compensation expenses recognized for the six months ended June 30, 2025, amounted to US$6,856,485, with unrecognized compensation expenses of US$21,854,203[99] - As of June 30, 2025, 50,000,000 Class A ordinary shares and 603,864,286 Class B ordinary shares were issued and outstanding[108]
Trident Digital Tech Holdings Ltd(TDTH) - 2025 Q2 - Quarterly Report