Zhongchao(ZCMD) - 2025 Q2 - Quarterly Report

Revenue Performance - Total revenues for the six months ended June 30, 2025, were $5,601,079, a decrease of 32.7% compared to $8,348,329 for the same period in 2024[3] - Service revenues decreased to $4,910,889, down 25.6% from $6,595,083 in the prior year, while product revenues fell to $690,190, a decline of 60.7% from $1,753,246[3] Profitability - Gross profit for the six months ended June 30, 2025, was $2,709,724, representing a gross margin of 48.4%, compared to a gross profit of $4,737,096 and a margin of 56.7% in 2024[3] - The net loss attributable to Zhongchao Inc.'s shareholders for the six months ended June 30, 2025, was $965,254, compared to a net income of $90,047 in the same period of 2024[3] - The comprehensive loss attributable to Zhongchao Inc.'s shareholders for the six months ended June 30, 2025, was $591,928, compared to a loss of $366,974 in 2024[3] - Net loss for the six months ended June 30, 2025, was $862,319 compared to a net income of $182,933 for the same period in 2024[7] Operating Expenses - Operating expenses totaled $3,589,173, a decrease of 25.1% from $4,788,646 in the previous year, primarily due to reduced selling and marketing expenses[3] Cash and Assets - Cash and cash equivalents increased to $8,912,022 as of June 30, 2025, up 13.6% from $7,841,306 at the end of 2024[2] - Total current assets rose to $19,117,935, an increase of 2.2% from $18,707,217 as of December 31, 2024[2] - Cash and cash equivalents at the end of the period rose to $8,912,022 from $6,279,809 in the prior year[7] Liabilities - Total liabilities increased to $2,558,665, up 47.6% from $1,733,900 at the end of 2024[2] Shareholder Information - The weighted average number of ordinary shares outstanding for the six months ended June 30, 2025, was 25,388,903, compared to 2,637,340 in the prior year[3] Cash Flow and Investments - Net cash provided by operating activities increased to $1,820,881 from $809,598 year-over-year[7] - Net cash used in investing activities was $(980,271), compared to $(1,797,664) in the prior year[7] - Investments in short-term investments totaled $6,121,512, while proceeds from redemption of short-term investments were $5,241,241[7] Other Financial Metrics - Accounts receivable increased by $992,889, while accounts payable decreased by $396,025 compared to the previous year[7] - Cash paid for income tax increased to $89,807 from $67,043 year-over-year[7] - Depreciation and amortization expenses rose to $155,946 from $94,574 in the previous year[7] - Provision for expected credit losses was $291,227, up from $117,820 year-over-year[7] - The effect of exchange rate changes on cash and cash equivalents resulted in an increase of $230,106[7]